TheFatBigot Opines

Let's not have a referendum

2011-10-20T01:42:00.004+01:00

I suppose it should be mildly encouraging that the House of Commons is to debate and vote on whether there should be a referendum concerning the UK's membership of the European Union. The BBC informs me (here) that what will be debated is whether a referendum should be held giving the great British public three choices: (i) remaining in the EU, (ii) withdrawing from the EU and (iii) staying in but renegotiating the terms "in order to create a new relationship based on trade and cooperation".

My initial reaction was to wonder at the absurdity of offering three options. Nothing seems to be said about the proportion of votes required for any single option to be deemed the winner. Will it be more than one third or more than half? If the former it will lack legitimacy, if the latter it will set a very high hurdle for each option. 40% for staying in, 30% for withdrawal and 30% for renegotiation could be contrued as 70% for staying in but trying to change the unchangeable or as 60% for changing the status quo without any obligation on government to do anything about it. Either way it is completely unsatisfactory.

My second reaction was to ask whether there is any difference between the first and third options and, indeed, between the second and third options.

Staying in does not prevent renegotiation of the terms of membership, so option (iii) (if acted on by the government) merely adds a requirement to enter negotiations. What it cannot do is dictate the outcome of those negotiations because, by definition, negotiations only lead to a change if all parties to the discussion agree on a specific outcome. As I understand it an outcome in favour of option (iii) would not require the government to do anything, although it would be bad politics for them not to make at least a token gesture of trying to change the terms of EU membership. And even if they were constitutionally obliged to negotiate that would not guarantee any particular result.

Leaving the EU cannot take place in a vacuum. The UK has numerous trade treaties with countries around the globe, absent such treaties practical business cannot be conducted and just those sorts of treaties will be required if we are to deal in a sensible manner with the remaining EU nations. Withdrawal from the EU necessarily requires new treaties to be negotiated with the new, slightly smaller, EU because country-by-country treaties with EU members are not an option - the EU as a conglomerate has control over such matters. In other words, withdrawal will require negotiation "in order to create a new relationship based on trade and cooperation" - so what of option (iii)?

The terms proposed for a referendum look like a hopeless and confused committee-created fudge. A referendum on the terms proposed is likely to achieve only one thing, namely to kick the issue into the long grass for the foreseeable future. Only a straight in/out question is appropriate.

80mph? Oh no, the planet is at risk.

2011-09-30T03:32:00.002+01:00

The government has suggested that the national maximum speed limit might be increased from 70 mph to 80 mph in two years' time, in the interim they propose a consultation exercise. Whether the outcome will be a change in the maximum permissible speed of motorcars on our roads is pretty much irrelevant to me. I have held an unblemished driving licence for decades and will not knowingly exceed a speed limit because I want it to remain unblemished. Consider me a boring prig if you will, but I prefer to live within the law whether or not I agree with it.

Today on my way back from a hack around the golf course I heard an item on this issue on BBC Radio 5 (actually not so much of a hack, I went round in 78 gross on a par 72 course, something went wrong with my usual ineffectual sporting technique - I only throw this in because I'm very proud of it and will almost certainly never do it again).

A number of statements issued by people and organisations involved in the motoring business were read and a few people were interviewed, including a former racing driver and the current Secretary of State for Transport. Some supported the proposal, some opposed it and some said it was necessary to investigate the likely consequences before changing the law. Fair enough.

What was not fair enough was that almost all contributors, including the Secretary of State, said a relevant consideration was the effect of an increase in the maximum lawful speed of motor cars on British roads on the amount of carbon dioxide exuded into the atmosphere.

It really is quite flabbergasting that the anti-carbon dioxide religion has taken hold to such an extent that a minor change in the law of England, Wales and (I believe) Northern Ireland should be thought to have a potential impact on emissions of CO2 that can be of relevance to the well-being of our planet and/or human life on our planet.

The UK (including Scotland which is in charge of speed limits through its own so-called Parliament and is unaffected by the proposed change) produces less than 2% of all carbon dioxide spewed forth by human activity. Traffic on roads carrying a speed limit lower than 70 mph will not be affected by the proposal and not all those travelling on roads to which the national speed limit applies will drive faster and spew more CO2 as a result of the maximum permissible speed being 80 rather than 70.

Against that background it is obvious beyond doubt that any additional CO2 coming from those cars that will be driven at higher speeds because of the proposed change will be such a small amount that it can make no difference to anything. It will be a small percentage (if, indeed it even reaches 1%) of the less than 2% of world emissions coming from the UK.

You can close down all human activity in the UK and the result will not have any measurable effect on the climate. Even if we accept the very direst predictions of those who claim additional human-produced carbon dioxide will cause great changes to the climate and that those changes will be detrimental to human existence, the removal of the 2% currently produced by the UK cannot affect matters to a measurable degree because other countries (especially China and India) are increasing their emissions by far more every year.

To take a proposal that might increase the UK's emissions by a tiny amount and seek to include that effect as a consideration that should affect the decision to accept or reject the proposal is, frankly, moronic.

An Immigration Fraud

2011-09-17T03:30:00.003+01:00

Immigration is a curious issue in British politics. Twenty and more years ago it was a core issue about which senior politicians would debate vigorously on national television and gain headlines in newspapers. Today there is the occasional soundbite but nothing more than that. All parties say they will be strict on abuses of the system but put forward nothing other than generalisations about how they will do it. When the party in power changes, nothing of any real substance ever seems to change.

In one important respect there is nothing any UK government can do because citizens of member States of the European Union have an almost unfettered right to come to this country. In another important respect there is nothing they should do because genuine refugees from the grimmer areas of human habitation must always be given a safe haven.

The point of today's waffle is something called the Ankara Agreement (for a summary of the parts that matter for present purposes, see here). One provision of the agreement allows Turks to apply for permission to enter and work in the UK if they intend to establish a business and show they have the financial means to do so. It is important to understand that an applicant who meets the criteria will be given the right to come and work here, there is no residual discretion to refuse an application that ticks all the boxes. What is required of an applicant is the intention to set-up a business and the money necessary to do so. The whole thing is about allowing in entrepreneurs, joining an existing business or working for a new business set-up by someone else is outside the Agreement. One might think very few people would qualify.

A whole industry has grown up around this aspect of the Ankara Agreement. There are firms of so-called immigration consultants who formulate applications for anyone who will pay them a fee.

These firms have template business plans they print-out with little or no amendment for scores of applicants. It goes without saying that the applicants are almost exclusively young men. One business plan that has been doing the rounds is the establishment of a bicycle taxi service in the West End of London. This was devised by one of the consultancy firms and has formed the basis of applications for permission to stay in the UK by dozens of men who came initially on student visas. It should be no surprise to anyone with a smidgen of common sense that most of them were not genuine students at all, they were the nephews (or sons of friends) of Turkish people already settled here and came to be part of their established businesses. They signed on as students at a language college of greater or lesser repute and worked in the uncle's (or father's friend's) restaurant or shop and then wanted to find a way to stay here when the period of their student visa was due to expire. From the beginning they came here to work and establish a life rather than to study, the student visa was simply a means to an end.

The Ankara Agreement is also treated as a means to an end. Recently I met a friend of a friend who used the bogus bicycle taxi business plan and was refused permission to stay because the judge saw through the scam. The applicant himself was disappointed but not surprised, he knew his intention was to continue working in his uncle's restaurant in the midlands and that he would rather smear his scrotum with toothpaste than operate a bicycle taxi. He knew the application was a scam, took his chance and lost.

I know others who have been given leave to live and work here under the Ankara Agreement despite having no intention at all to set-up their own business. Some just want to live a western life rather than a repressive Islamic life, others simply want to avoid national service in the Turkish army, most want both.

When discussing this topic with local Turks it is obvious that there is no desire to harm the UK behind the fraudulent applications that are made. There is no intention to scrounge benefits or to engage in criminal activity, the intention is simply to come here, work hard and make a life in the UK rather than in Turkey. A few days ago the excellent Mr Raedwald wrote about the Turks (here), his piece encouraged me to write on the subject because his positive view of Turks is the same as mine.

In the normal run of things I would be inclined to denounce systematic fraud of the type behind the hundreds of bogus applications made under the Ankara Agreement each year. I find it hard to denounce people who come here under student visas to see whether life here will suit them and, when they decide it will, want to find a way to remain so that they can earn an honest living. Of course there is a conflict between the honest lives they want to lead and the dishonest means they use to secure a right to remain here. It could be said that they do not want to lead honest lives at all because the lies told in their applications show them to be seriously dishonest. I understand that argument entirely and part of me agrees with it, the other part of me asks why people who want to work for a living should not be allowed to do so. Although their applications are fundamentally fraudulent they are not intended to harm anyone and, as far as I can tell, they do not harm anyone.

Until a few weeks ago I had never heard of the Ankara Agreement. Since then I have been talking to a number of local Turks I have known for years, what they told me about the way the Ankara Agreement has been used for decades accorded exactly with the way it was used by people whose applications were recently allowed or refused and who allowed me to look at the paperwork. Some of it was quite astonishing, particularly the successful application of one man who applied on the basis he was planning to start a website design business when he has worked as a waiter in a Turkish restaurant since he came here two years ago and still does the same job today. He just wanted to stay here and continue his life here, the alternative was at least a year in the army followed by starting from scratch. He was lucky, his bogus application succeeded. Frankly, this country is better for having him here because he is good at what he does and benefits the business that pays him. It sould surprise no one that a Turkish restaurant keeps its customers happier by having good Turkish waiters rather than employing Wayne or Jermaine, why should there be any obstruction to a good Turkish waiter living here so that he can provide that service?

The Ankara Agreement induces fraudulent applications because it establishes an avenue for people from one culture to live a new life in a more appealing culture. Indeed, so appealing is the new culture that a whole business has developed around finding ways to use the opportunity provided by the Agreement. It is a massive fraud.

A better course would be to allow everyone in provided they pay their way - no benefits, no right to housing, no hand-outs. Earn your way or go home. The young Turks wouldn't be going home in a hurry.

Tobacco companies and open goals

2011-09-03T03:56:00.003+01:00

Eid Mubarak.

That is the traditional greeting given at the end of Ramadan, despite having lived in an area with a substantial Turkish population for more years than I have lived anywhere else I only learned that this week. Saying it elicits the same smiley response as Merry Christmas in the middle weeks of December. Now that Ramadan is over I no longer have to abide by the dietary strictures I imposed upon myself a month ago, so tofu and cauliflower need be avoided only on the ground of their venal characteristics and not for any other reason.

Talking of venal characteristics, on Thursday I made the mistake of turning on the radio on my way to golf and was assaulted by an absurd anti-smoking zealot spouting forth on the Victoria Darbyshire show on BBC Radio 5. His name was Professor Gerard Hastings. The good Mr Puddlecote knows more about him than I do and has posted (here) on the very subject that lies behind today's missive.

I can summarise the background quickly. Professor Hastings leads a department at the University of Sterling (an establishment with a fine reputation he is doing his best to destroy). That department is funded by taxpayers and has the remit to identify every possible fact or inference that can possibly be used to argue against the consumption of tobacco products. One of his latest wheezes was a survey of teenagers with the view to ascertaining their opinions of smoking tobacco and the factors that influenced them or might influence them into taking up that particular hobby. The survey, as I understand it, comprised asking a series of questions and recording the answers.

If that is all that had been done, one might ask why it was done, but of course it is not all that was done. Once the answers were received they were "interpreted" by Professor Hastings and his merry men and conclusions were drawn. Conclusions which he is proud to contribute to public debate on the issue of what, if anything, government should add to its current panoply of anti-smoking legislation and regulation. I put it in those terms very deliberately because there is no possibility at all of Professor Hastings reaching any conclusion suggesting that anti-smoking laws or regulations should be relaxed in any way. He is paid specifically to find fault, something he is very happy to do and is perfectly entitled to do provided he does so honestly and is prepared to justify his position. His interview on the radio suggested that one result of his so-called research supported the argument for plain packaging for cigarettes - I know not what other contentions it contained but this is the one he pressed to Miss Darbyshire.

A tobacco company, which uses the trading name Philip Morris, asked for details of the facts behind the conclusions/inferences drawn by Professor Hastings and his team. The request was, of course, made to the University not to the Professor himself so I cannot ascribe the patently unlawful refusal to give any information to him, nonetheless he was keen to associate himself with it on national radio.

On this occasion the BBC also allowed time for Philip Morris to give its side of the story, and it is this that is the substance of my ramblings. A woman, whose name I cannot recall, answered the more absurd points put forward by the Professor. For example, he said the survey was conducted on the basis that the answers would be strictly confidential and that this means the answers could not be disclosed. Being a man with a fine title but no common sense, he failed to realise just how stupid a point he was making. If the answers could not be disclosed he could not publish any conclusions drawn from them because, by doing so, he was disclosing the answers. That might not be quite as stupid as his argument that his University should not have to disclose the findings of fact on which his "research" was based because it is just a university yet Philip Morris employs tens of thousands of people around the globe. Quite what that has to do with the Freedom of Information Act is beyond me. Were I a professor maybe I would understand, as things are it sounds like illogical nonsense.

Now, back to the Philip Morris woman. When asked to justify her company's request for the data behind Professor Hastings' tendentious conclusions she warbled on about a need to know "the basis of the research". This was Radio 5 in the morning. The audience could not reasonably be expected to know ins-and-outs of the way anti-tobacco "research" operates or, indeed, of how proper scientific research operates, still less can they be expected to know the heavily-nuanced phrase "the basis of the research". The good Professor provided her with the killer point but she did not grasp it and undermine his credibility as she should.

Professor Hastings wants all employees of Philip Morris to lose their jobs, he wants the company closed, he wants its business to cease to exist. He said as much when Miss Darbyshire prompted him to do so.

The Philip Morris lady's best point was to assert that her company's business is lawful, employs tens of thousands of people (some thing the Professor seems to consider an evil), contributes vast quantities of tax to the Treasury and is entitled to protect its business against unfounded attacks. So, if it is attacked, it is entitled to ask whether the attack is well-founded or not. The purpose of the request for disclosure of the data behind Professor Hastings' conclusions can only be to see whether it supports the conclusions he asserts. If it does, it does; if it doesn't it doesn't. No one can know unless they are able to see the data and analyse it for themselves. She didn't get within spitting distance of making this obvious and decisive point. It is a point that knocks all of Professor Hastings' smug self-justification into a cocked-hat.

Professor Hastings "research" led to the assertion of conclusions designed to damage Philip Morris's lawful business and put all its employees out of work. Given that this might be the result of his conclusions being adopted in legislation, Philip Morris is entitled to ask whether his conclusions are sound. That can only be known by seeing the factual evidence from which he drew inferences. He can assert until the trump of doom that his conclusions are well-founded but no sensible person should be expected to accept that merely on the basis of his assertion. Unless the raw material from which he draws inferences is disclosed, he is asking for Philip Morris's business to be damaged purely because of his subjective interpretation of material no one else can examine.

Were we lucky enough to have independent-minded people of substance in Parliament, his conclusions could be challenged there. Instead we have far too many MPs who are constantly asking whether what they do will damage their hopes of re-election or advancement within their party. Going against current accepted wisdom can damage both, so they chicken out regardless of their personal views.

I do not know whether the Freedom of Information Act allows Philip Morris access to the anonymised answers given to Professor Hastings and his team (and Mr Puddlecote is wrong in suggesting that the Scottish Information Commissioner ruled that it has such a right, he ruled that the University must either disclose the information or give a good reason under the Act why it should not do so). Whether the Act does or does not allow access to the information deflects attention from the real issue. The real issue is whether a lawful business should be damaged because someone - in this case Professor Hastings - asserts that information he refuses to disclose supports the doing of harm to that business.

In the real world occupied by fair-minded people, substantiated reasons are required before government harms a lawful business. Fairness requires businesses to be able to ask why government proposes to do them harm. To rely on nothing more than the word of a fanatical academic whose salary and department are dependent on him giving the answers government wants to hear is to replace fairness with random bigotry.

It really is time the tobacco companies fought back and pointed out that a lot of people, something over one-fifth of the adult population of this country, choose to consume tobacco products and pay blistering amounts of tax for the privilege. Narrow-minded, bullying bigots might try to stop them by producing skewed analyses of data that is statistically insignificant in any event. Professor Hastings could fall into this category, he certainly doesn't approach the subject with an open mind as he admitted freely to the dozens of people listening to his irrational rantings on Thursday morning.

People like him are an open goal for any tobacco company with guts. Maybe the prevailing narrative is that smoking is an unmitigated evil with nothing in its favour, it certainly seems to be so from my perspective here at FatBigot Towers. When a prevailing narrative is based on a fundamental flaw, it takes someone with guts to stand up and say "hold on a minute, is that right?". It is an Emperor's new clothes scenario. Tobacco companies can afford guts and they can afford to face-down those who seek to attack their lawful business by publishing conclusions that are unsound. I know not whether Professor Hastings' conclusions are unsound, what I do know is that he cannot be trusted to be objective.

We cannot expect poor quality MPs to investigate whether his conclusions are correct, and nor should we. He is attacking lawful businesses who should fight their own corner. The first step in doing so is to put forward spokespeople on national broadcasts who avoid quasi-scientific jargon and get to the point.

This is an issue on which there is a chance of common sense replacing bigoted dogma. If the tobacco companies cannot grasp the lifeline provided by the truth we might well be destined to a future of having to accept falsehoods because they are "officially" decreed to be the truth.

I'm slowing during Ramadan

2011-08-05T02:56:00.006+01:00

Ramadan started on Monday. Around here there are many nominal Mohammedans who ignore every inconvenient rule of their religion throughout the year yet feel compelled to keep to some of them for a spell of thirty-ish days. I have been investigating the matter in depth using my usual statistically significant technique of having a chat with shop staff while taking a ciggy outside their premises and with waiters while taking a nourishing exotic repast.

What is obvious beyond argument is that there are few who observe Ramadan strictly. I have heard all sorts of excuses, such as (I paraphrase): "I can't fast today because the shop is short of staff and I need to do the work of two people", "I can't avoid fornication today because my girlfriend is English and she'll get it elsewhere if I don't perform", "I can't refuse alcohol today because Mr Miggins is our best customer and he might go elsewhere if I don't have a drink with him." It's all very dog-ate-my-homework stuff. Others claim to be observant whilst cheating blatantly - one local shopkeeper has the owner of adjoining premises keep his water bottle in the fridge, it is a strange water bottle being made of dark glass and housing scotch and cola. Water is allowed, so he pops next door regularly for rehydration.

It has always mystified me how some supposedly religious people feel free to pick and choose the religious rules they are willing to obey. Either they are rules or they are not, either you believe in observing them or you do not. Believing you really must obey the rules for a month or so but may ignore them the rest of the time (until the next period of piety arrives) makes little sense to me. In the good old days of Woolworths I can certainly understand that those who did not like the peanut cracknel would not put any in their bag at the pick-n-mix counter, but we're talking immutable rules of behaviour laid down by a superior force to which no exceptions are allowed. How can people be utterly indifferent to those rules for most of the year and feel it necessary to create excuses for breaking them during a particular period?

The answer seems obvious. Their perceived duty to comply during Ramadan is cultural not religious. No doubt they think it is religious but in reality it isn't. Let me give a real example of someone I know well enough to be able to explain both how he acts and what he says he believes. On coming to London a couple of years ago drinking, smoking and fornication were no part of his life. He had been brought up in a Moslem household and held to the standards of personal behaviour his parents instilled in him. Once here, attending a language school, the college organised outings and provided tickets giving free entry to night clubs and other places of entertainment. It also provided mixed-sex classes including young ladies from all over the world who were not shy of disclosing their assets and their desire to have them explored by classmates. Within weeks he was smoking tobacco regularly, attending clubs and drooling over female flesh exposed in a way unknown in his home country. And he liked it. In order to see rather more flesh he had to buy drinks and, not surprisingly, felt it only polite to take a small beverage himself. Now he drinks regularly and has many notches on his bedpost. He is fasting this Ramadan, avoiding alcohol even outside the hours of daylight and keeping his overused organ in his trousers. He claims he is doing it for religious reasons.

On being questioned why he breaks the rules the rest of the year but feels it necessary to comply now, he says it is such a heavy sacrifice compared to those who have never "sinned" that time of abstinence is a more devout act than for those who know not of the wicked ways of the western world. That is no answer because the rules is the rules and the rules say "Thou shalt not" they do not say "Thou shalt not unless Thou doest in which case Thou shalt not during Ramadan only". He acknowledges readily that there is a single indivisible set of rules and that he chooses which to obey and which to ignore and when. Yet he is adamant that he must keep Ramadan because that is how he was brought up and it is important to him to maintain that link with his home country and, in particular, with the ways of his late father. What he describes is not a religious observance at all but one of culture - national culture and family culture. I have described it as such to him and he does not disagree, yet he prefers to say it is also religious because that is how he perceives it. Fair enough.

I also know one of his chums from his home town. Were he inclined to fast during this Ramadan he might not be able to take the medicines prescribed by the clap clinic following an encounter with a large-breasted Polish woman a couple of weeks ago, but he is not fasting. His visa is about to expire so he's making the most of his last few weeks in London. When asked how the lifestyle he has in London can be justified according to his religion he said, and I quote: "I don't hurt anyone, I just enjoy myself". I doubt there can be a better analysis of the absurdity of religious rules about what we consume and how we excercise our other bodily needs, they are utterly pointless compared to conducting ourselves in a way that does not harm other people. A rapist is a rapist regardless of whether he likes a bacon butty.

The chum is not fasting, as he put it with a heavy Turkish accent "I do not fast". I suggested he should say "I slow." I'm all for slowing for Ramadan.

(Amended after being alerted to an error about the length of Ramadan this year.)

Nationalise money - problem solved

2011-08-04T04:32:00.002+01:00

I pity the governments of Portugal, Ireland, Italy, Greece and Spain (the PIIGS). They are doing their best to keep the wolf from the door but at every turn private investors pose impertinent questions and scupper their initiatives.

The truth is really very simple (what follows is a distillation of many research papers helpfully collected together - here - by a fellow blogger).

Governments print money. If they run short, perhaps because of the additional overtime paid to equality and diversity SWAT teams whenever a duskily hewed homosexualite has been refused promotion, all they need do is print another few million and the problem is solved. Or, to be exact, it would be solved if it weren't for those pesky private sector investors complaining that the additional tenners swishing through the system dilute the value of their cash reserves. And why would the problem be solved? Why does the printing of more ten pound notes not cause problems to anyone other than conspiratorial facist investors? For the answer to that question we need a short lesson in very modern economic history.

You see, it's Gordon Brown. He understood and we should all learn at his feet. More government spending means more economic activity. More economic activity is good, therefore more government spending is good. Got a town that's looking a bit crummy? Simple. Print 20 million tenners and spend them in that town building skate parks, healthy eating clinics and climate awareness centres, then print another 20 million to pay salaries. A crummy town? Not any more it isn't. It has skate parks, healthy eating clinics and climate awareness centres, it has a thousand people on good salaries manning these essential front-line public services. Misery has turned to universal joy and happiness. Crummytown is renamed Brownsville and all is right with the world. We know all this to be true because this was the basis of the economic miracle forged by Gordon Brown in his decade in the Treasury.

Only one group ever argued against Mr Brown as he stood triumphant before the World. That group was people and companies who forced Mr Brown to borrow money from them rather than just continually print more on the old hand platen that has been in the back bedroom at 11 Downing Street since 1805 (it proved a little inconvenient while the Blair family lived at Number 11 but Brown had a key and he was delighted to find the printing press was in the boys' bedroom).

One might think he should have just printed more, however that was fraught with political difficulties. If Gordon Brown is one thing, he is a man of the big tent. Not for him the marginalising or exclusion of any group, least of all those who might complain that he was acting out of small-minded, party-political spite. He simply had to keep the international financiers happy, to do otherwise would strike at the essential core of inclusive humanity that defines his moral compass. Much though he hated to do so, he knew his duty - that duty was to borrow hundreds of billions on the money markets in order to prove his fair-mindedness. It wasn't a problem because he only needed to spend a few more hours with the plates and ink in the back bedroom, a task that could be undertaken at any time once the usurous financiers had been repaid.

To complete this short history I must refer to what some have called "Brown's Bunker". The theory goes that Gordon Brown surrounded himself with a small group of yes-men, working out of one room at Number 10, insulated from and antipathetic to any voices of disagreement. Papers recently disclosed by an impeccable source prove beyond doubt that the only bunker in Downing Street during the Brown years was that specially created to house the enormous printing presses and stocks of "paper" required for Gordon to stimulate the economy after the wicked international bankers had made such a mess of their businesses they had to be bailed-out.

What cannot be ignored is that Gordon Brown's economic miracle would have continued unabated, and he would now be President for Life, were it not for the nasty private sector pretending its money was as pure as that produced in Downing Street. He was a victim of his own fairness and honesty because he could not bear the thought of a single banker's child losing their pony or being deprived of lacrosse coaching. In the circumstances of the time he was, of course, absolutely right, as he remains on every topic to this day. Nonetheless, his fairness created a bit of a pickle - a pickle for which he is not in any way to blame, we know this because he tells us so every time he is paid many thousands of pounds to give a speech.

It will be a matter of great regret until my dying day that the general election of 2010 came just before Gordon Brown had the chance to put into effect the final piece of his masterly jigsaw. Having, he thought, proved that all economic ills are caused by private sector businesses, the time was ripe for nationalisation of the funds held by these wicked shysters. No need for printing presses, a simple CHAPS transfer to HM Treasury would do the trick. There would no longer be any private sector investors involved in the UK economy, everything would be under the benevolent hand of the greatest economist the World has ever known - the man who knew that every hitch could be overcome by creating more bank notes.

All across the Eurozone we now see the greatness of his wisdom. Why is Greece in a mess? It's simple, private financiers are demanding repayment of their investments with interest. What an utterly absurd state of affairs it is. All Greece need do is nationalise the money it has been lent and its problems will be over. It will owe nothing. The slate will be wiped clean. What's more, it could then turn on the printing presses and boost its economy just as Gordon Brown did to the UK economy from 2003-7. So too for the rest of the PIIGS. They are foreigners so they would face no moral impediment as Mr Brown had with the bankers.

A country's credit rating cannot be downgraded if it never borrows, even more so if there are no credit rating agencies and there would not be once the vital step to economic harmony and perpetual glee was put in place. Mr Brown understood this. All you need do is nationalise all money and the problems not just of the PIIGS but also of every nation would disappear at a stroke.

A pincer movement of sheer lunacy - Part II

2011-07-29T05:18:00.002+01:00

In Part I (here) I bemoaned the absurd overreaction by the professionally smug to the non-news that newspapers buy information obtained by illegal phone tapping. A week has now passed since a Parliamentary committee manned by incompetent cross-examiners conducted a kangaroo court trial of three people connected to a particular newspaper and failed to pin a tail anywhere near the donkey's anus. The only public outcry of which I am aware concerns the distasteful bugging (tapping, hacking, call it what you will) of telephonic communications involving the families of deceased people. Reprehensible though I consider such activity to be, there is no evidence that disclosure of any improperly obtained material has caused inconvenience, embarrassment or upset to any family members. In short the whole thing is a bit of a non-issue over which politicians - sniffing the chance to pass laws preventing their own sordid secrets being exposed - have whipped themselves into an unnecessary lather.

Part II is about the apparent intent of all our main political parties to make electricity oppressively expensive. I am not going to rehearse the unanswerable arguments against reliance on generating electricity from wind and waves, nor am I going to rail against those in rabid servility to every scare story promoted by those whose financial position rests on acceptance of the catastrophic man-made global warming hypothesis. My concern is with something much more basic and, in my view, important.

As recently as twenty years ago I doubt many would have argued with the proposition that elected politicians in the UK had one duty above all other - to do what they considered to be in the best interests of the people they represent. Of course there can be honest disagreements about what is in the best interests of the little people but the focus of the exercise was unaltered by the outcome of the debate. MPs were in parliament to represent their constituents by acting in what they considered the best interests of their constituents. On local issues they would fight for what they felt was best for the constituency, on national and international issues they would broaden their remit to cover all the people living in the UK because the interests of their constituents were the same as the interests of every other person in the country.

Is it in the best interests of those living in a particular constituency and those living in all constituencies for electricity to be cheap or expensive? To my mind that is not a difficult question and should permit only one answer. Cheaper electricity eases pressure on household budgets and reduces the costs of doing business, as such it is a blindingly obvious desire for any right-thinking person whether or not he is a Member of Parliament. More expensive electricity hits the poorest hardest and hampers our businesses in their aim of selling goods and services to overseas customers. It takes a weirdly warped sense of priorities for any MP to promote a policy that impoverishes his own constituents and the country as a whole.

We all know why they continually pass laws making electricity ever more expensive. In part it is because they have fallen for the great global warming scam. In part it is because they hope it will bring in additional tax. In part it is because they want to set a pointless example to other countries in which politicians are not so craven to Saint Al of Gore and his distinctly unmerry fellow-travellers. In part it is because they have fallen for the "green jobs" scam. In part it is because they are scared of the party whips. In part it is because they think there might be votes in presenting themselves as "green". All these things explain why they support a particular line of policy, but none justifies voting for measures that hurt their constituents and damage the economy of the whole country.

Never let it be said I will miss an opportunity to state the obvious, and today is no exception. The reason we in the UK enjoy our current standard of living is that we have found ways of making physical comfort cheaper than it was before. Human beings have always been doing this and over the last two hundred years or so we have done it so successfully that we now measure material deprivation in the UK not in terms of basic housing, food and clean water but in terms of access to the internet, holidays and mobile telephones. Material comforts that are now taken for granted and deemed essential to subsistence living were either science fiction or oppressively expensive as recently as forty years ago. This happy state of affairs has been brought about by the amazing ability of human beings to invent new things and improve old things so that a luxury lifestyle of the 1950s is attainable on the minimum wage in 2011.

At the heart of all this improvement in the quality of everyday physical comfort is electricity. The cheaper it is, the better we all live. And do not ever forget that those earning good money will always be able to afford comfort, what really matters is allowing those of modest means the ability to get more comfort for their limited money. That is a fundamental part of the duty of MPs to act in the best interests of their constituents and of the country as a whole. However tempting it might be to satisfy international or party agendas, their duty is to their constituents and to the UK. Electricity costs are at the heart of all our lives, especially those of modest means, and any MP with his or her eye on the ball should be fighting against any government measure that increases its price.

A pointless Olympic junket

2011-07-28T01:25:00.004+01:00

Apparently the start of the Olympic Games in London is now just a year away. Tickets have been sold and many eager sports fans left disappointed by not being able to gain access to even a first qualifying round of an obscure event. The very nature of an Olympic Games means that promotion, advertising and encouragement to either watch or participate are wholly unnecessary. Many more than the number that can be admitted to watch have applied for tickets already and all those with a realistic chance of competing have been well aware of next year's event for years.

For some reason the prior anniversary of the start of the event has been deemed an appropriate reason to spend millions of pounds on promotional events around the world. The BBC reports (here) that yesterday London was subject to a rally in Trafalgar Square at which the head of the International Olympic Committee invited competitors to London and the design of the medals was unveiled, the Olympic swimming pool was opened and both the Mayor of London and the Prime Minister made speeches saying what a jolly good games London will host. And (here) it reports that promotional events were hosted at British tax payers' expense at "nearly 100" foreign venues "to encourage visitors, businesses, students and sports people to get involved".

Has there ever been a more fatuous waste of money? I know the competition is stiff but this really does stand out as a piss-up-wall venture of heroic proportions. It's the bloody Olympic games for crying out loud. No one needs encouragement to visit London during the games, or to use it as an advertising medium (which is its only relvance to businesses) and absolutely no sports people are unaware that the Olympics come round every four years wherever they are held. As for students - what on earth have they got to do with the price of fish? I can't help thinking that these events exemplify three worrying phenomena.

First, we have domestic politicians lending their names and time (and our taxes) to an occasion of no relevance to anything domestic other than the standing of those same politicians. Had there been no rally in Trafalgar Square, no formal unveiling of medals and no formal opening of the swimming pool the games would happen next year just the same. As it is, events were organised. That gave a fine opportunity for politicians to divert from their selfless path of public service in order to be there and look good in front of the cameras of the world. They had the option of doing something useful instead and allowing the IOC to spend its own money promoting its own event without assistance from the UK tax-payer. Sadly, there are few votes and no fame to be gained by staying in the office and getting on with work.

Secondly, we have an unaccountable supra-national organisation flying a delegation into town and being treated like visiting heads of state. Why? The games will be held here next year and never again in my lifetime or the lifetime of anyone involved in the IOC. The venues will either be ready or they will not, the medals will either be pleasing to the eye or they will not, new rail and bus routes will either prove efficient or they will not, security measures will either prevent bombs being planted and/or detonated or they will not, visitors will either find hotels in their price range or they will not, everything else involved with the games will either work well or it will not, a visit by delegates of the IOC will make no difference to anything. All that will be achieved is the reinforcement of the concept that such people are special and are due special treatment. That, in turn, reinforces their unaccountability and the prospect of corruption.

Thirdly, we have an enormous waste of money with no one in power questioning a penny of the expense. It's only a few thousand, a few hundred thousand or a few million; chicken feed in the scale of government spending so it doesn't matter. To me it matters an awful lot. There are countless examples of local and national government throwing money at events of no value simply because the sum involved is minuscule compared to the total budget. I really don't care whether the total of all such sums would make a significant dent in the overall budget because they are a waste of money and should not happen regardless of their overall effect on a balance sheet.

I find myself asking why the Olympic Games is not treated like any other commercial venture. Be in no doubt, for the IOC it is a commercial venture just as the football World Cup is a commercial venture for Fifa. Those organisations rake in millions for their own use (and that of their officials) regardless of how much they then distribute to national sports associations. They operate like the EU. What comes first is the organisation at the top, everything lower down the pyramid of power is beholden to the, always unaccountable, Politburo.

In principle national governments are not beholden in the same way because they are not dependent on finance from the supra-national body, however the "ahem" in the woodpile is politicians. Politicians want votes and think, probably correctly, that associating themselves with those in charge of major sporting events is likely to gain more votes than it will lose. The unfortunate downside is that bribes have to be paid. I don't mean brown envelopes stuffed with folding cash (not in this country, anyway), what I mean is spending tax-payers' money to keep the international bureaucrats comfortable and to put on events that make them happy so they will heap praise on the hospitality given to and the respect paid by the Prime Minister to the august body they represent. There is no benefit to the people of the host country, all benefits land safely on the plates of the international bureaucrats and the domestic politicians who laud them.

The result is ever more power and influence being exercised by supranational sporting bodies. For so long as a national government wishes to gain prestige by securing the right to host a major sporting event it must butter-up the small coterie of bureaucrats at the top of the organising body. It would make economic sense for the Olympics to have a permanent venue because country after country that has spent many millions on stadia has found little demand for those facilities once the games ended. Well well, what a surprise. Were there a domestic demand for such facilities they would have been built and then paid for by the fees charged to the people who use them. As it is Olympic stadia for numerous sports are built in a closely defined geographical area which has never before witnessed any demand for such facilities.

Giving the Olympics a permanent home would remove the scope for the supranational body to exert influence, receive favours and bestow honour on incumbent politicians. That is why it will never happen.

Michael Gove plays with his organ

2011-07-23T06:21:00.002+01:00

Looks like Michael Gove to me.

Bloody good playing anyway.

Here.

A pincer movement of sheer lunacy - Part I

2011-07-15T00:26:00.005+01:00

In the curry house yesterday I was asked whether I had been out in the sun, apparently my forehead was bright red and deeply blistered. The reason is not exposure to sunlight, it is relentless frustration with the stupidity of current political debate that has caused the vigorous and repeated application of palm to head. At the moment our Parliament seems to be dominated by two topics - the activities of the press and the government's desire to make electricity prohibitively expensive. Both subjects seem to have a magical power over MPs such that they spout complete and total nonsense without any comprehension of the lack of common sense behind their analyses. I'll deal with the press today.

The basis of Parliamentary hysteria seems to be the "revelation" that a tabloid newspaper published information gleaned from illegal phone taps and computer hacks. Well, well, what a surprise, who'd have thought any such thing has occurred in this country? Everyone, that's who. Another, secondary, "revelation" is that journalists paid money in return for information the law requires to be kept confidential. Well, well, what a surprise, who'd have thought such a thing has occured in this country? Everyone, that's who.

There is only one sensible reaction to these "revelations". It is to get the police to investigate the matter and charge anyone against whom there is sufficient evidence. The activities complained of are already illegal under our law so there is no need for any more laws. The one and only thing that should be done is to enforce existing law.

Instead a Court of Appeal Judge is going to be kept out of court for a year or more so that he can conduct an inquiry which will be called a whitewash if he says current laws are fine and a witch hunt if he says new laws should be passed.

In Parliament we have witnessed the unedifying spectacle of buckets of sanctimonious hogwash being sprayed around by hundreds of MPs, each trying to out-outrage the previous speaker with the level of their ignorant and hypocritical humbug.

Everyone with a brain larger than a pea knows newspapers act in underhand and, sometimes, unlawful ways to get attention-grabbing information they can plaster across their front pages. They all do it. Locals, nationals, broadsheets, tabloids - they all do it.

How do you think the Yokel Local Chronicle learned about the intention of Big Supermarket PLC to buy farmer Giles's front field for a new shop? It's obvious, someone working for the company leaked the news, probably in return for a fee or favour. In that instance the person working for the supermarket company broke the terms of his contract of employment and risked summary dismissal. He had to balance the benefit he gained against the risk of losing his job. The newspaper knew he was breaching his contract but also knew there was no realistic chance of being sued, so it published anyway in order to have a good headline, a reputation for having it's finger on the local pulse and the chance of greater circulation in future and higher advertising revenues. The only question that would trouble the editor is whether the information was true.

Paying for information obtained in other unlawful ways is different only in degree from paying for leaked confidential information about the intentions of a supermarket chain. The degree might be higher or lower, but the substance is the same each time. That some information results from activities that amount to criminal offences and other "feeds" involve a breach of contract but not a crime is a distinction without a difference in this field. We have laws against this sort of activity. Those laws provide a penalty for anyone proved to have breached them. There is one reason and one reason only why those laws were broken - the people breaking them considered the benefit of the breach to outweigh the risk of being caught and/or the penalty for being caught and pursued to judgment. Making the activity doubly unlawful will not change this because it is a matter of human nature rather than of law.

Increasing the penalty can make a big difference to how people behave but it brings up a wholly different matter that makes serious penalties impossible. How does phone tapping or hacking emails compare to burglary, or stabbing someone or holding-up a bank with a shotgun? Obviously infringements of privacy are not in the same league, so what maximum penalty can be justified without the law becoming absurd? There is no certain answer to that question although the general answer is that the maximum penalty, and the penalty actually imposed in any particular case, is unlikely ever to be so severe that it would deter those offered a chunky financial inducement.

Members of Parliament can huff and puff all they want about how morally reprehensible it is to tap the phones of the families of deceased soldiers and victims of crime. I doubt that there are many in the country who have not huffed and puffed in disgust. Nothing MPs say and no amount of hot air they expel can change anything. Newspapers will still use whatever means they can get away with to obtain the information they think their readers want to read, because more readers means more advertisers and that is where the money is.

A theme that ran through contributions in the debate in the House of Commons was a call for regulation not just of how newspapers obtain information but of what they publish. This deserves to result in blistered foreheads across the nation. Do these people really think the interests of the people of this country as a whole are best served by newspapers being constricted in what they are permitted to print and how in buggery do they think such restrictions can be imposed?

Only two restrictions can ever be justified. First, they should not publish things that are untrue. The law covers that already (albeit imperfectly) through the law of libel. Secondly, they should not publish anything that causes them to lose business. This is nothing to do with the law, it is all about the little people voting with their feet. Editorial judgment must be exercised to decide whether a story will be good or bad for circulation. If it will be bad it should not be published, if good it should be published, if it appears good but turns out to be bad the paper can look for a new editor. No other restrictions can have any justification under any circumstances. I hear you cry: what about kiddy porn? Simple, advertisers will disappear overnight, only a few pathetic dribblers will buy the paper, the publisher and numerous editorial staff will face lengthy time behind bars and next week there will be no newspaper.

The very suggestion that there should be any sort of State control over the content of newspapers other than the law of libel is so absurd as to be obscene. Some might suggest it is part of a plot by politicians to protect themselves from criticism, I do not agree. I believe it to be nothing other than an irrational knee-jerk reaction to extremely distasteful newspaper activities that have been exposed recently. The politicians want to be heard expressing disgust so they can have their local paper report they have stood up to be counted. OK, fine, let them say it and get their favourable editorial, then they can return to the real world and acknowledge that what was done was unlawful so no new law is needed and that any attempt to censor the press is bound to fail.

The question they are really addressing is this: should Parliament legislate to prevent publication of the truth? Sadly, they do not seem to be willing or able to understand that this is what they are doing. In any event, how can Parliament legislate to prevent publication of the truth? The key here is "prevent publication". How can Parliament - which can only do anything through the laws it passes - prevent someone doing something? As the law now stands there are penalties for doing naughty things once you have done them, and only then if you are caught and there is sufficient evidence to prove you did them. It is the risk of penalty that is preventative. Short of physical restraint, all the law can do is threaten a penalty in the hope the threat will prevent naughtiness.

So, how do you prevent the truth being told? The simple answer is that you cannot, all you can do is pass laws imposing penalties for telling the truth and therein lies the fundamental flaw in all the guff spouted in Parliament. They can moan about invasions of privacy and the extreme distastefulness of some of those invasions until they are any colour in the face they choose, but they cannot produce a rational argument for the truth being suppressed. If that truth is not to the taste of a newspaper's readership there is a risk to advertising revenue, if it is to their taste the till will ring triumphantly. The little people will vote with their £1 coins. Parliament is an utter irrelevance on this issue. Honourable members should shut up and keep their fingers crossed that their peccadillos remain below the radar.

What is justice?

2011-06-28T02:24:00.004+01:00

A nasty fat scrote was convicted last week of the murder of a thirteen year-old girl by the name of Amanda "Milly" Dowler (here). Her murderer, as he was eventually proved to be, pleaded "not guilty" when put on trial so the forensic process that has developed over centuries was put in train. English law, as it stands at present, requires the prosecution to prove the guilt of an accused person beyond reasonable doubt and has a complex system of procedural rules to try to ensure that no innocent person will be convicted of a crime. Only a fool would suggest that the system is perfect, nonetheless it is as it is as a result of thousands of minor adjustments over hundreds of years. Further adjustments will be made as time passes, I can only hope they all bear in mind the overriding consideration that the innocent should not be convicted.

The procedural rules cover four main areas. First, there are requirements for the police to conduct their investigation subject to certain limits, for example questioning suspects must not involve oppressive actions. Secondly there are limits to what can be put before a jury - this is the law of evidence that, for example, allows hearsay evidence only in certain circumstances. Thirdly there are limits to how a lawyer may put a case in court, these are imposed by the codes of conduct that apply to barristers and solicitors. Breach of the codes of conduct can, in extreme cases, lead to someone being disqualified from practising law and in less extreme instances there can be suspensions of practising certificates or fines. Fourthly, trials are presided over by judges who have a wide discretion to prevent lines of questioning if they consider them insufficiently relevant. It is not without reason that judges can only preside over serious cases if they have earned a "ticket" to do so.

Over the last few days the conduct of the lawyers defending Milly Dowler's murderer has been subject to a great deal of ill-informed criticism. I need not explain the errors of the critics because it has been done already by Ms Wig (here), to which I was alerted by the good Mr Paine. My comment today is not about the details of that case but about something much more troubling, namely a false definition of justice.

One thing we must get clear right at the beginning is that the victim of a crime is the victim - not the victim's family and friends, not the readers of a newspaper, not people with children of the same age or bearing some physical resemblance to the victim, not people of the same racial or social grouping as the victim, but the victim and only the victim. Milly Dowler was the victim and only Milly Dowler was the victim, desperately distressing though her death was to her parents they were not the victim, Milly Dowler was the only victim in the murder of Milly Dowler.

Justice in the case of the murder of Milly Dowler could be delivered only by convicting her murderer of murder and having him sentenced according to current sentencing laws. That is an exercise between the State and the accused. It is absolutely not an exercise between the victim's family and the accused.

Far too often I read or hear references to a criminal trial bringing justice for the victim or the victim's family, that is utter nonsense. It will, no doubt, give them a degree of comfort that someone has been convicted; frankly they would receive the same degree of comfort whether the person convicted was the murderer or someone who was completely innocent. The administration of criminal justice is exercised by the State on behalf of the general populace and is intended to reach a true result whether or not the victim or victim's family is happy with the outcome. I say again, in serious cases the victim and/or victim's family often wants someone convicted, anyone, and they have no interest in whether the convicted person is guilty of the offence. The system of justice is designed, albeit not perfectly, to convict only those proved clearly to be guilty. If that means a family continues to mourn a murdered person and never discovers who committed the heinous crime, so be it.

The system must be unemotional and impersonal. The system must acquit anyone it cannot prove to be guilty. He or she might be guilty in fact but if we, as a general society, are to impose a penalty we would not volunteer for ourselves we must do so for good reason. A crime committed against a famous or popular person deserves no greater investigation and no lower standard of proof than one committed against a homeless crack addict with no family or friends to wail in public. Each requires the over-weaning powers of the State to result in a penalty against an individual only if the State can prove that a penalty is justified.

It is inevitable that some very serious crimes are never solved. No matter how thorough the police investigation, nothing can happen unless it turns-up evidence of sufficient weight to justify prosecuting a suspect. And even when the Crown Prosecution Service believes it has enough to justify a prosecution, that will only be enough to justify a conviction once a trial has been conducted, the defendant's lawyers have challenged the prosecution case as well as they can and a jury has returned a verdict of guilty. Unsolved cases involved victims and family of victims just as much as solved cases.

Criminal justice is about the defendant not the victim or the victim's family. There is no such thing as justice for the victim or the victim's family because, by definition the victim has already undergone his or her trauma, sometimes fatal trauma, and his or her family have suffered their consequential trauma. All that is left is the chance of identifying, convicting and sentencing the perpetrator. The only question is whether there is sufficient evidence to satisfy a jury that they should say "guilty" rather than "not guilty".

Pandering to victims and, in particular, to consequential or vicarious victims is no way to administer justice. If we give them any special protection in court from the questioning that would be relevant of a non-victim / non-victim family member, we risk placing their peace of mind above justice. I know it it will sound harsh to those of a certain mind, but it must be said loud and clear - no victim and no victim's family is entitled to see someone convicted and given a penalty. Whether someone is convicted and given a penalty depends not on the feelings and desires of anyone, it depends on cold, hard proof of guilt to the strict standard that is imposed to ensure (so far as possible) that only the guilty face the serious penalties resulting from conviction for criminal offences.

In this field, as in so many, meaningless feel-good concepts have been developed by psychologists with too little to do. One such concept is that of "closure" ( I occasionally comment on a "bad word", this is one). I watch little television but I do enjoy quasi-documentary programmes about real crimes, especially murders, a lot of which feature on a channel called Crime and Investigation. Time and again there is a police officer spouting words he has learned but never analysed, he says "we are pleased to have given the family closure" or some such twaddle. Anyone with half a brain understands that the death of a loved one is something that lives with you for ever. That someone is convicted of killing the late lamented loved one gives a degree of comfort but the pain continues and will continue until the end of your life. "Closure" is a concept designed to make victims or their families feel good but it has nothing to do with justice.

Criminal justice is not personal, it is not something delivered to victims, it is wholly and utterly about the State imposing a penalty against those proved to have broken laws. It is, so far as the system can ensure, impartial, impersonal, unbiased, unbigoted and aimed at only the defendant. Any attempt to change these principles will result in more innocent people being convicted, that is not something I would welcome.

Chinese PM: "Scrap the Euro"

2011-06-27T02:54:00.004+01:00

They're dashed clever these oriental types and they grow up in a culture in which loss of face is a serious matter. Whenever an established position needs to be altered you will not witness an admission of error or even of change of mind, the switch will be effected either by sacrifice of the career and reputation of the person nominated to take blame or by a series of gradual shifts of emphasis, each explained as an incremental development of existing policy in the light of new circumstances.

Their approach mirrors that of most modern western European politicians, these days only the rarest instance arises of an overt and admitted change of mind. Here in the UK we saw a sea-change in the mid and late 1990s as the spin machine of the Blairite Labour opposition pounced on any division, indecision or flip-flop on the part of the incumbent Conservative government. It was a well-organised (but patently dishonest) approach and it presented the image required for electoral purposes. Since then a united front and a consistent position have been seen as fundamental to the prospect of gaining political power, it allows only limited scope for a change of mind, indeed I would suggest the only exception is when both main parties have to abandon a previously advocated stance because of external factors.

The main players of the EU are even less inclined to change their positions, albeit for a different reason. No ballot box can oust them but they are on a mission to remove all powers from individual EU member states and create a single political system under the dictation of the EU oligarchy. In order to achieve this they must appear strong, so strong that national governments have no realistic chance of challenging or overturning the position the EU's permanent rulers have decreed to be correct. Perhaps the greatest exemplar of this is the Euro. The Euro is the means by which the aim of unified political control can be achieved. For some us it is also seen as the means by which unified political control can, should and will be defeated but that is not the topic for today.

Buttering-up the locals publicly is a necessary part of international diplomacy, often accompanied by quiet expressions of criticism being made behind the scenes. Criticising the locals publicly is an inevitable part of international power-grabs, often accompanied by soothing words of support to incumbent politicians in private until they are no longer of use. When it comes to business, the ideal situation to find is one in which others are acting in a way that will be of enormous benefit to your business in the long term. In that situation you would be mad to point out their errors, so you adopt your public diplomatic hat and say nothing else, safe in the knowledge that it will deliver you economic power that you could not achieve by criticism. That is what China's Prime Minister, Mr Wen, is doing very successfully during his short tour of Europe. We are told (here) he said "China will consistently support Europe and the euro." Well, yes, of course, he would be mad to say anything else. Supporting Europe is a fine sentiment that is totally without substantive meaning. The final three words are, however, in a different category.

Why would China want to support the Euro? A strong Euro zone full of throbbing economies making lots of goodies to sell to China would undoubtedly provide all the benefits history proves to arise from efficient, competitive production but the same would arise from those throbbing economies having their own individual currencies - as it did throughout the industrial era until the Euro was established. Portugal, Italy, Ireland, Greece and Spain (the PIIGS) are living proof that the Euro does not have magical powers and cannot turn idleness into profit or house-price bubbles into genuine wealth. The economies of these countries are not throbbing and nothing about the Euro can make them throb. If truth be told they would probably not throb outside the Euro but they would have the chance of stability at their own sustainable level of economic activity. Out of the Euro these countries can offer China greater trading opportunities than they can while still inside but that is not of any great interest to Mr Wen.

Mr Wen is playing the second half of the game China played during the boom years of 2003-7. Then China cashed-in on the additional money (I stress money, not wealth) sloshing about Western Europe due to the expansion of credit beyond sustainable levels. That it was not sustainable made no difference to China, it sent us washing machines and we sent it money. Washing machines lose value far faster than money, they need to be replaced so China says thank you and sticks another wad in the bank. Now that the PIIGS are having to face up to their earlier folly and are unable to ease their situation by devaluation, they need to raise money. The EU considers it necessary to keep them in the Euro zone and the only way that can happen is by increasing their debt enormously in the short term in the vain hope of something coming along later to allow repayment. One thing can come along in pretty short order, namely Chinese money. After all, China has lots of money in the bank that came from the PIIGS in exchange for washing machines and other jolly delights of modern life.

Buttering-up the locals is easily done when you have lots of money. The course chosen by China is to buy Euro currrency bonds issued by the insolvent PIIGS, to send a signal of confidence that is in fact nothing of the sort because they are safe in the knowledge that those bonds are essentially backed by all Euro zone economies (including Germany) due to the EU's need to support the Euro project. All the while the PIIGS will remain insolvent unless they can raise large sums of money. China is awash with the profits from years of washing machines, that is all very well except that cash can only fall in value over time whereas turning cash into capital assets stands a chance of giving a positive return over the longer term.

China's plan is to buy capital assets at below par value, a plan that is easy to achieve when the current owner is desperate for cash and is willing to hold a fire sale just to get something in the bank. It happened with the MG Rover site in Birmingham and it will happen with state-owned and privately-owned land and businesses throughout the EU. The UK and most of those in the Euro zone gave them the money to do so by creating credit we could not afford and spending it on Chinese goods, now that we need additional money (either because we are illiquid or because we are insolvent), the very money we created is being used to save us however in return we must give capital assets we can have no hope of ever recovering.

Of course China supports the Euro. Maintaining the Eurozone with its current participants means there are five countries (the PIIGS) in such dire need that there are rich pickings for Mr Wen and his merry men.

When Mr Wen says his country will support the Euro he is not giving it a Good Housekeeping Seal of Approval, he is shouting as loud as he can that the Euro is a disaster and must be scrapped to prevent the wholesale transfer of capital assets to his country.

They're dashed clever these oriental types.

The truth about Greece

2011-06-22T02:50:00.009+01:00

Now look, there's no need to get yourself into a twisted-knicker situation, it's all really very simple.

Individuals, families, businesses, clubs, towns, cities, counties, countries or federations of countries only have so much wealth. Wealth is measured in money but money is not, in and of itself, wealth. Money is a system of tokens that we give and receive in place of real stuff. The true value of money is dictated by the stuff it represents. I grow a pound of runner beans and you like to eat runner beans so you are prepared to give me something for those runner beans. What should you give? Well, that's up to you. You decide what my pound of runner beans is worth to you. You might offer two pounds of potatoes, or a small diamond, or twenty minutes with your wife, or you might offer money. You must value my runner beans and offer what you consider to be a fair exchange. What is essential is that you offer something of substance because I have no incentive to give up a pound of delicious green scrumptiousness unless I receive something that I value as highly as I value the finest vegetable god ever created.

Our transaction is not about money, it is about stuff. It is about something substantive. I give you something to enhance your life and you give me something to enhance my life. Were I to accept potatoes, diamond or fleeting fleshy pleasures with a lady who has seen better days, we exchange no money. Except that we do. Money is involved in all trades, even barter, because money is just a language by which we value stuff. Money is involved in a swap of a pound of runner beans for two pounds of potatoes just as it is involved in the swap of a pound of runner beans for a £2 coin. The reason it is involved is that the trade comes first, the stuff comes first, and money is just a way we can assign value to the goods we exchange. That exchange involves £2 for £2. My £2 is runner beans, your £2 is ten minutes access to a scrawny dry crone, although the reality is the other way round - £2 is the token we assign to represent each side of what is actually exchanged. Without stuff behind it, £2 means nothing. It has no value of itself.

That is not to say that the production of a pound of runner beans that gives me a £2 coin is a transaction without consequences. I take that coin to Mr Patel's Minimart and exchange it for a super-sized condom (in preparation for my next visit to Madame Fifi's Sauna and Hanky-Panky Parlour) thereby giving Mr Patel a bit of profit and justifying the profit he has already paid to Mr Choudery's Cash-n-Carry who have already given a bit of profit to the manufacturers of the intimate rubber item of gentleman's apparel. Their profits are the consequence of me producing something new. But that tells the story from only one side. Kingdong Condom Ltd also produced something, something rather big actually, and it is the combined action of turning what I produced and what they produced into economic activity that gave work and profit to Mr Patel and Mr Choudery. The whole thing is sustainable because it is based on stuff that people value sufficiently to be prepared to exchange their own stuff for it.

Economic activity that is not part of the production and exchange of stuff is a drain on the wealth of a national economy. What each country has to do is decide how much of the profit derived from the production of stuff can justifiably be committed to activities that drain wealth. Some government expenditure supports and contibutes to the production and exchange of stuff, sadly the things that buy votes are usually nothing other than a drain.

Greece suffers from one thing and one thing only, its government spends far too much money on things that do not support and contribute to the production and exchange of stuff.

There is only so much wealth in any national economy. It can go up and down from year to year but each year and each decade it is limited by the amount of stuff that is produced and exchanged. Wealth comes from the production and exchange of stuff and from nothing else.

Governments can produce more money but they cannot produce more wealth because they cannot produce more stuff. They can produce money by diluting their currency through either the printing press or devaluation, in each case they reduce the value of each unit of currency in circulation; they do not, however, change the substance of their national economy. The substance is dictated by the production and exchange of stuff. Currently the government of Greece can produce neither money nor stuff. It cannot turn on the printing press and it cannot devalue because it is tied into the ludicrous Euro, yet it is spending far more on non-productive governmental activity than the Greek nation's output of stuff can sustain.

Greece is bust, it's a simple as that. Nonetheless it still has a valuable economy, it's just that it is overvalued because it is tied into the Euro. Released from the straitjacket of the Euro the true value of it's economic activity will be reflected because there will be adverse effects to every part of its economy from its government continuing to overspend. Only then will there be any chance of the Greek economy becoming sustainable.

Privately collected taxes

2011-06-13T02:24:00.003+01:00

My old chum Mr Wadsworth regularly puts forward a proposition I just can't understand (as he did yesterday). The starting point, as I understand it, is that governmental activities sometimes result in people making money they would otherwise not make. No one could dispute that. This government-inspired profit is described as "privately collected tax", and that is the concept I cannot grasp.

I suppose it all depends on where you start. The blankest page is one of anarchy, a situation in which there is no government and, therefore, nothing we would describe as law. Onto that blank page we put a system of government or, to be more precise, we put a system of law. The most basic effect of any system of law is prohibition of particular activities accompanied by sanctions for breaking the prohibition. Every prohibition that impinges on economic activity results in people either gaining or losing money compared to how things would be in the absence of the prohibition. I can illustrate what I mean with a simple example.

Two factories make motor cars. A law is brought in requiring all new cars to meet a particular standard of robustness in the event of a head-on collision. Factory A's cars meet that standard but Factory B's cars do not and it would cost so much to redesign them that Factory B is no longer viable. Factory B closes and Factory A makes additional sales as a direct result of Factory B no longer being a rival. As I understand it, the theory says Factory A benefits from "privately collected taxes" because it makes additional income because of the new law - that law gives an economic advantage and this advantage is said to be a "privately collected tax".

I fail to see this as privately collected tax. To my mind it is an economic consequence of a law but it is not a tax unless you adopt a highly artificial definition of tax.

It is hard to find an example of economic activity in the UK which is not affected by law. The costs of manufacturers and retailers are increased by the need to comply with health and safety laws. Those who are unable to comply or who can only comply at a cost that makes their business unprofitable will go to the wall. They do not go bust because of tax they go bust because of the cost of complying with the law. Those who are able to comply do not make "privately collected taxes" they make income by selling their wares within the framework of the law. All businesses that receive income by way of cheques or card payments do so only because there is a framework of law to give such payments a cash value. Businesses that deal only in cash receive valuable income only because the law recognises bank notes and coins to have value. To what extent do the laws that turn cheques, plastic payments, notes and coins into useable value represent "privately collected taxes"?

No sensible person could deny that laws allow people to make income they would not make in the absence of those laws. Indeed, I would go further and suggest that no one earning a living in this country would earn exactly the same living doing exactly the same thing without a complex framework of laws affecting the job they do and the field of business within which they operate. Identifying a single law and suggesting that it provides a benefit that should be classified as a "privately collected tax" is, in my view, to take that single law out of context. All other laws that affect the business in question will necessarily increase or decrease income or costs. Any law that increases income must be balanced against laws that increase costs.

It is no more realistic to look at those laws that lead to increased income or decreased costs as allowing the business to benefit from "privately collected taxes" than it is to say the laws that lead to decreased income or increased costs amount to "privately incurred tax rebates". And that is the heart of the matter. Once one adopts the language of tax to describe something one must adopt all the language of tax and describe every aspect of the business in the same way. If you describe economic benefits received because of a new law as "privately collected taxes" you have to have a description of losses incurred as a result of a new law. Only "privately incurred tax rebates" could fit the bill yet it is a nonsense because there is no one to pay a rebate. The reality is that some people benefit from new laws and some people suffer a detriment, but neither the benefit nor the detriment is tax in any sensible use of the word.

The PIIGS and one-sided equations

2011-06-03T01:16:00.005+01:00

The good Dr North has been pointing out for some time that things in Europe are not all sweetness and light (for recent examples, see here and here). He observes that mass demonstrations are taking place with a degree of regularity in Spain and Greece as the little people give vent to their frustration at the economic mismanagement of their political masters. None of us knows what the outcome will be, nor whether it will be the same in both countries or, indeed, in any of the other countries teetering on the brink of government bankruptcy.

What troubles me is not that people are finally waking up and complaining, it is that they are complaining about completely the wrong thing. Their target is undoubtedly correct, politicians have left the PIIGS (Portugal, Ireland, Italy, Greece and Spain) deep in the mire through reckless economic mismanagement. Their complaint, however, appears not to be that their governments borrowed and wasted too much but that they do not want their governments to stop borrowing and wasting now that existing debts cannot be repaid. We see exactly the same delusionary behaviour in this country whenever the trades unions wheel out their usual rent-a-mob to bemoan a tiny bit of trimming from departmental budgets to find cash to pay the interest charges incurred by Gordon Brown's feckless stewardship of the Treasury.

I am not in the least bit surprised. Governments all over Europe have been winning elections for years by presenting one-sided equations that sound nice but do not stand up to even the gentlest scrutiny. These one-sided equations are the tool of every headline-grabbing initiative and are not restricted to the field of economic policy, we see them all the time in the field of health policy.

Smoking / drinking / one food / another food / too much exercise / lack of exercise / salt / lack of salt, or whatever is the scare of the day, is calculated to cost the NHS so-many hundreds of millions of pounds and must therefore be banned. The figures are always wrong, always grossly exagerrated, but that is beside the point; even if they were correct they only look at one side of the equation. Treating medical conditions which might not have arisen had the patient not been a smoker can be seen as a cost caused by smoking, there is nothing unreasonable in that as a general proposition. The problem is that the NHS does not exist in a vacuum and it is not funded in a vacuum, it is funded out of taxes and smokers pay taxes that others do not pay; shops and wholesalers make profits on which taxes are paid, workers in those businesses and in every stage of the cigarette production and distribution network pay taxes on their wages. The taxes gathered from the ciggy network grossly exceed even the most dishonestly overstated costs attributed to adverse consequences of smoking.

The same is seen in the moronic argument that "green" production of electricity will be economically beneficial because it will create new jobs. Of course it will create new jobs because no one has been so stupid before to pay people to do anything so utterly pointless, but even so the benefit of these new jobs is only one side of the equation. On the other side lies the fact that employing more people to generate the same amount of electricity means it is more expensive and that cost must be passed on through higher prices. Higher prices for electricity means higher costs for businesses and individuals. Those businesses can be tipped into insolvency causing their employees to lose their jobs and individuals who must spend an extra £100 on electricity have £100 less to spend on other things thereby depriving Mr Patel's Merrymart and Madame Fifi's Sauna and Hanky-Panky Parlour of income, resulting in shed staff and less tax being paid. No one should be surprised that studies in both France and Scotland reveal each "green" job to cause the loss of more than two other jobs.

So it is also with the bubble of economic activity arising from an unsustainable expansion of credit. Of course it means people have more money and buy more stuff which means shops and manufacturers employ more staff, make more profit and pay more tax. The government takes credit for the miracle of an ever-expanding economy. Apparent riches for all means votes for incumbents. The other side of the equation in this situation contains what groovy hep cats might term a "double-whammy".

Credit cannot go on expanding for ever, eventually you reach a point where you cannot borrow any more because even the most foolhardy lender is not prepared to advance you another penny. At that point the economic expansion arising from credit necessarily stops and in due course it must be reversed as people realise they must repay their borrowings. It doesn't necessarily happen all of a sudden although it did two years ago because banks simply stopped lending. In addition to the reduction in economic activity resulting from the wind-down of credit-based spending we have the second whammy, namely a reduction in tax receipts for the government. The additional sums received in the boom years were used to strengthen their electoral position. Were we cruel people we could suggest they used tax receipts to bribe voters, but we aren't cruel so we will instead describe the spending of this windfall of unsustainable taxes as the result of nothing more sinister than stupidity. Unfortunately the stupidity knew few bounds so the PIIGS, the UK and many other countries find themselves with government spending commitments far in excess of tax receipts.

A sober and sensible approach to the problem would recognise that governments handed out treats that could not really be afforded even when times appeared good, so now that they are far from good those treats cannot be given any more. The governments of Spain and Greece are trying to cut back a fraction of the unaffordable treats and it is this that causes discontent on the streets. The people are complaining that something they should never have had in the first place (because it could not be afforded) should be maintained despite government income being substantially lower than it was in 2009, it is utter madness. A particular difficulty arises with government spending compared to individual spending, namely that the consequences of reducing it are highly visible. A million people each spending £50 less is equivalent to government spending £50million less - the former is just a normal incident of life whereas the latter is a headline in every newspaper.

I cannot help thinking that pushing one-sided equations at their people and arguing tooth and nail that the equations in question have only one side is the root of current public disquiet in Spain and Greece. There is every sign that the people demonstrating against plans to trim government spending really believe there is only one side to the equation. In a way this should not be surprising, both countries had long periods of socialist government in which the allure of the magic money tree was all pervading - no need to worry, the government will pay for it, the government has a bottomless pit of money because it just plucks some more from the magic money tree. We should be more worried about this reason for mass demonstration than we would have to be were demonstrators complaining about overspending in the past.

Huhne - the car's the key

2011-05-29T14:58:00.004+01:00

Let's take a hypothetical situation and see how we should go about solving a mystery. The situation is this. A man has been in in France for a few days and flies back to England, landing at Stansted airport at about 10.23pm. The same evening his wife is at a function at the London School of Economics, the function commenced at 6.30pm and she is believed to have left by 10pm at the latest. At 11.23 the same evening a motor car registered to the man is photographed speeding on a road between Stansted and London. Either the man or his wife was driving the car at the time the speeding offence was committed. The mystery is to identify which of them was driving.

How do we solve the mystery? I know how I would go about it, I would not look at the people first but at the car.

Where was the car while the man was in France? On the face of it there are two relevant possibilities, either it was parked at the airport awaiting his return or it was not. Is there a record of cars parked at the airport during the period he was abroad and, if so, was his car parked there throughout or was it removed at some point? If it was there all the time the only chance of the wife driving it back to town from the airport would be by her taking the train to Stansted (say 20 minutes to get to Liverpool Street station and at least a further 45 minutes to Stansted). Quite why she would do so rather than let him drive back is unclear, because the time it would take her to get there is as long as the flight from France so it would have to have been arranged before he left the continent.

If there is no evidence of the car being at Stansted throughout I would investigate whether the London congestion charge was levied against the car during the period he was abroad, if it was we know the car was within central London and not at Stansted. Was the congestion charge levied on the day in question? The London School of Economics is within the congestion charge zone, so the charge will have been triggered if the wife had it with her while she was at the college, though her options for parking would have been severely limited unless she was given a spot by the college itself - was she?

I would then ask whether the wife had her own car at the time. If she did, it would seem more natural for her to use her own vehicle to collect her husband. Wives often, but not invaiably, use their husband's cars to collect their worse half only when he wants to drive back - men being so much more fussy than women about what they drive.

Trying to solve the mystery by reference to where the wife was at various points of time on a date more than eight years ago is fraught with difficulties because of the need to rely on personal recollections. The car is the key.

Raping common sense

2011-05-19T00:11:00.003+01:00

Rape is a subject only the bravest or most foolhardy politician deals with because you can be sure that anything you advocate, short of castration of all male babies at birth, will result in a torrent of high-volume but low-quality nonsense from a whole raft of attention seeking morons.

Ken Clarke proclaimed, to universal outrage from the non-thinking, that some rapes are worse than others (summarised here). He was, of course, absolutely correct. Some murders are worse than others, some armed robberies are worse than others, some speeding offences are worse than others and some rapes are worse than others.

It should be observed at the start that there are two broad categories of rape, reflected in the American distinction between "statutory rape" and "rape". Statutory rape is, in broad summary, consensual sexual intercourse where the law deems one or both of the participants to be incapable of giving consent even though they do actually give consent. In this country the age of consent is sixteen, so every time a girl or boy under the age of sixteen has sexual intercourse the other person involved commits rape according to English law and it is fair and sensible to call it "statutory rape" even if both parties consent. It is not rape according to the law that applies to adults because adult consent is recognised as being of value in the eyes of the law, but consent under the age of sixteen is deemed impossible. It takes a staggering degree of blind ignorance to be unaware that girls and boys of fourteen and fifteen have been rutting for generations, they certainly did when I was at school. Nonetheless, the law is as it is and it has to draw a line somewhere, however imperfect or unreasonable that line might be in particular cases.

"Statutory rape" itself comes in many shapes and forms. You can have two fifteen year-olds "doing it", in which case each is raping the other according to the law. You can have one under-sixteen and one of sixteen; one of fourteen and one of nineteen; one of fifteen and one of forty and so on and so forth. According to the law, each of these instances involves exactly the same offence but only a fool would suggest they are all the same. As a matter of everyday experience we might like to presume that the older person always holds sway and, as a general rule that might well be true, but it is far from always the case.

"Rape" as opposed to "statutory rape" arises where one party does not consent to intercourse. It might be the male or it might be the female. Is it not obvious that a difference exists between every "rape" and every "statutory rape"? In the former one party does not consent, in the latter both parties consent but the law does not recognise the consent of at least one. In the former it is necessarily the case that one person is forcing themselves on another in the most intimate way possible whereas in the latter no one is necessarily being forced to do anything.

So what of "non-statutory rape", is it a single black-and-white offence without shades of grey? Of course not. Some rapes involve the minimum possible amount of violence for the perpetrator to get his or her way while others include threats of violence from the mild to the utterly terrifying or violence itself of every conceivable degree. None of this dilutes the fact that the act of rape itself is a serious violation of one human being by another, and Mr Clarke was not suggesting otherwise. He was pointing out nothing more than that some rapes are more serious offences and, therefore, deserving of harsher sentences than others.

I first learned of this episode when listening to a radio news broadcast while driving back home after collecting a pile of manure. As soon as the BBC's summary of Mr Clarke's comments was given I said to myself "it's Wednesday, Milliband will have called for Clarke's dismissal at Prime Minister's Questions". Lo and behold, Miliband called for Clarke's dismissal at PMQs. Pure student union politics - naive, unrealistic and failing to address the point that was made. It was like having Gordon Brown back but with a fake mockney-estuary accent rather than a dribbling, bitter Scottish brogue.

The absurdity of Miliband's position is that he had an open goal and chose to kick his opponent rather than the ball. Ken Clarke did not just offer opinions about rape out of the blue, he did so in the context of a proposal to reduce the length of time some rapists spend in prison after conviction. Perhaps Miliband was mindful of his own party's failings during their thirteen years in government, during which sentences for serious offences got shorter and shorter and punishments for petty regulatory infringements got harsher and harsher. The standard three years' imprisonment for a first domestic burglary has become a caution or written warning or a few hours of community service. The standard seven years for rape without extrinsic violence has fallen to between two and three. Armed robbery now gets six years rather than twelve. Defrauding the taxpayer of tens of thousands of pounds earns only eighteen months when four years would have been unappealable twenty years ago. All this happened during the previous government's time in office, sadly it is continuing now.

Rape is a nasty offence. Forcing someone into the most intimate possible act against their will, with possible consequences of unwanted pregnancy or sexually-transmitted diseases, is barbaric to my simple mind. I doubt that many would disagree with the sentiment "no, you just don't do that to someone else, not ever". Few crimes get or deserve that reaction. Statutory rape in which consent is genuine does not get or deserve that reaction. Current sentences for non-statutory rape are derisory because Parliament has decreed that they should be. It is for that serious dereliction of duty that politicians should be held to account, not for pointing out the blindingly obvious.

Let's get this David Laws issue right

2011-05-11T01:39:00.003+01:00

David Laws is a highly intelligent and articulate man who has enjoyed great success in business and is now a Member of Parliament. For seventeen days last year he was a member of the Cabinet - appointed to the Privy Council and entitled to be known as "Right Honourable". In the fortnight between his appointment and his resignation he made a good impression on a lot of people, me included. The message he put forward was restricted to his ministerial duties at the Treasury and was as clear a statement as you could have of the necessary consequences of the previous government having spent far too much money that it didn't have. Then it was disclosed that he had claimed £40,000-odd in expenses to which he was not entitled and he left office (but did not resign from the Privy Council).

The essential circumstances of this wrongful receipt of money are important. Mr Law was a secret homosexual and shared a home with a gentleman friend. Beause he did not wish to disclose his proclivity to his family or to the world in general he pretended that he was renting a room in his friend's home and claimed that rent as expenses. The reality was that he was living with the man rather than renting a room from him. No doubt he made a financial contribution to the running of their joint household and, had matters been declared openly, at least some of that could have been reclaimed as expenses. I have read suggestions that he could have claimed more than he actually claimed and am happy to accept that as true.

Two matters that frequently crop up in discussions about Mr Laws must be discarded immediately because they are not relevant to the crucial point.

First, that he is independently wealthy as a result of his previous work did not disqualify him from claiming legitimate expenses. A system existed for compensating Members of Parliament for constituencies outside London for costs they incurred by reason of having to run two homes rather than one. We can quibble about the details of the scheme but there was a scheme and an MP who incurred additional living costs was entitled to claim at least some of them. Mr Laws could afford not to claim anything but it would be absurd to argue that his private wealth should exclude him from having additional costs reimbursed - that would amount to requiring him to make a substantial additional contribution of tax.

Secondly, that he could have claimed the same sums or more had he arranged matters differently is neither here nor there. He did not arrange matters differently, he arranged them as he arranged them for reasons of his own. A footballer who hacks an opponent's ankle to prevent him making a pass cannot avoid a yellow card by claiming that he could have used a lawful shoulder charge instead. What matters is what happened not what might have happened had you not chosen to do what you actually did.

The crucial point is very very simple. He told deliberate lies in order to expropriate money. Had he been paying rent to his friend he would not have been entitled to reclaim that rent because of the nature of their relationship (namely that they co-habited in a single household regardless of bedroom preferences). It seems unlikely to me that he did pay rent, but anything is possible. If we assume he did pay rent he was not entitled to reimbursement and he knew it. He lied about the nature of the relationship in order to get the money. It is blatant fraud. If, as I suspect is more likely, he contributed financially to the household and those contributions are not properly defined as rent, he lied about the nature of the payments he made in order to be repaid out of public funds. That is also blatant fraud.

It is a matter of the simplest and most basic test of honesty. Spinning a policy so fast that a politician appears to be saying something factually inaccurate will be defined as lying by his political opponents when it is possible (sometimes only by being incredibly generous) to describe it as ambitious advocacy. Some might consider it dishonest or even fraudulent to act in this way but there is room for debate on the issue. There is no room for debate when it comes to making deliberate false statements in order to claim money you could not obtain if you told the truth.

Some might suggest that Mr Laws should have special dispensation because he was merely trying to keep his private life private. That just doesn't wash with me. He told deliberate lies in order to get money from the public purse. Whatever the circumstances and however strong the mitigation might be, the underlying dishonesty remains and that dishonesty is what is relevant first last and all the time in this tale.

Now suggestions are being made that Mr Laws might return to the cabinet. I am not concerned about the "signal" this sends to anyone, because that looks at it from the wrong angle. I am concerned that someone who thought it appropriate to lie in order to obtain money he could not have obtained by telling the truth should be in Parliament at all let alone in the uppermost layer of government. No matter how able he might be and no matter how strongly he wanted to keep his sexuality secret, his chosen method of protecting himself was to act in a way wholly inconsistent with the responsibilities of ministerial office.

It was not so long ago that dishonesty caused resignation as a matter of course, not just resignation from ministerial office but from Parliament, and banishment to the history books as a former politician with no hope of recovery. Ability was irrelevant because the right to represent others and to hold power over others required probity. The country might lose the services of someone with much to offer but that was of no consequence when the politician in question had failed to conduct himself in a way Parliament and the law requires the little people to behave. You can call it a betrayal of trust if you want, I believe it is something more general and, perhaps, more fundamental. If you are to have power over others you can only justify your position if you live by the standards the law requires of those under your power.

Mr Laws chose to act dishonestly and in doing so he forfeited any right to have power over others. He should not still be in Parliament, for him to return to the cabinet would cast a serious blow against the fragile legitimacy of the current coalition government.

That wedding business

2011-04-30T03:21:00.003+01:00

Well, it really was a good do. This was the first royal wedding at which the couple committing matrimony were young enough to be my children and I think that affected my view of the whole affair. The previous two, Andrew and Charles, were marriages of people of my general vintage and so I thought what I thought (but rarely said) at friends' weddings - don't do it you bloody fool. Everyone knows that, at least for ordinary folk, there are only two consequences for a man who marries, he gets less sex and more nagging. When you see someone of your age plunging into the pool of perpetual frustration that is married life you think you should be able to persuade them of the folly of their ways. You can't do that with a generation above or a generation below, the former call you a whippersnapper and the latter tell you to fuck off. That means I was just an observer and felt I had no personal iron in the fire.

The whole thing was done terrifically well. We might not be able to get much right in this country these days but we are bloody good at pomp and ceremony. There was something quaintly pleasing about the simple act of people dressing up in their finest to attend at the big church. Of itself that made it special. I witnessed the effect of dressing up many years ago. It was a boring Friday at work, everyone seemed miserable so I rounded up my closest friends there and invited them and their co-duvetees to dinner at FatBigot Towers the following evening - and I issued a black tie dress code. My then pupil (apprentice barrister) wasn't sure whether I was serious but duly attended with his young lady in appropriate attire, as did all other guests. I don't know how many dinner parties I had given before involving most of the same people, but this one was different right from the beginning. The only change from normal routine was that the chaps were in black tie and the gals in ball gowns yet it made a massive difference to the whole atmosphere of the evening. It turned a dinner party into an event. So it was today when we saw female guests trying to out-hat each other and males trying to be as penguinlike as possible. Even the old queen was dressed properly, as was his friend Mr Furnish.

Eveyone was in place, Her Maj looking a real treat in a fantastic yellow number, then it was time for the bride to appear and expose her frock. I can claim no specialist knowledge of frocks but it looked like a pretty well-cut piece of kit. The usual ooohing and aaahing from the crowd accompanied her arrival and the irritating television commentary gave loads of meaningless details about the dress itself, but no one said what seemed most obvious to me. Her outfit was rather, hmmmm how can I put this, well, it seemed distinctly nipply. The girl herself is not endowed with a particularly noticeable bosom so it might be it was a design feature to make people concentrate on something other than the generally fried-eggish nature of her mammarial area. And it did, all I could think was nipples; nipples nipples nipples. Not a word on this seems to have passed from the mouth or keyboard of any other commentator, so it might be I am just a pervy old saddo, but I'm right.

The Duchess of Nipples did not prevent me noticing how much fun the crowd was having. Perhaps it was enhanced by the generally miserable mood of the country at the moment, but it was clear that hundreds of thousands of people were having a really good time. I look forward to George Galloway announcing his conversion to monarchism, after all he has argued for years that a crowd of 250,000 on an anti-war march was proof that the war in question was misguided, now he will feel compelled to argue that a million or so people cheering the House of Windsor justifies the existence of the monarchy for many years to come.

What we saw today, of course, was the normally silent majority in action. People who wouldn't dream of going on a march or urinating on war memorials but are prepared to display that happiest of civilised traits - taking pleasure in the pleasure of others. We just have to hope that the Duchess of Nipples doesn't turn out to be a manipulative publicity seeking tart with shit for brains like her husband's late mother. Time will tell. For now we can just smile and remember a very pleasing day.

And the nipples.

A university experience from America

2011-04-23T02:40:00.004+01:00

I have been following the university applications of a friend's son with some interest. He applied to eight institutions, all of them established and esteemed universities and all of them American. In the circumstances that is hardly surprising because my friend is American and lives with her family in Massachusetts. Her son has always done well at school, obtaining very high grades in almost all subjects. He is not a wholly outstanding student but his grades gave him a realistic chance of a place at Harvard or Yale. Despite being shortlisted for interview at both, he was not offered a place at either and instead had to choose between two other very well known universities. I won't say which because it doesn't matter for the purpose of today's screed. What I want to write about is an aspect of how the whole process works for people of modest means in the USA.

Unlike here, there is no culture of expectation and no culture of entitlement. The concept of education being "free" is unknown because everyone knows it is not free, it is just a matter of who pays for it. Suggest to my friend that her son should be entitled to have his tuition and keep paid for and her question will be "who by?" (they are not very good at 'whom' over there and care not a jot if a sentence ends with a preposition). Parents understand that universities are independent institutions and have to raise money to pay the costs of providing the tuition and other facilities that youngsters wish to use to increase their prospects as they enter adulthood. Equally, the universities exist to provide a service and have to justify that existence through offering a service that is sufficiently attractive to entice people to pay. Insufficient paying customers and the course is scaled back or eliminated. The thinking at the universities is not that they are entitled to paying customers and some means must be found to pay for however many courses they choose to offer, it is that a loss on one course means students on well-subscribed courses will be at risk of receiving a lesser service than would be the case if poodle varnishing were left off the curriculum.

My friend's son applied not just for a place but also for funding from university bursaries and scholarships. His parents have ordinary jobs, each paying under the national average wage. They have saved for each child to provide a college fund but their resources have not allowed them to create a big enough pot to do more than make a contribution towards the costs of a university course. Two factors affect the decision about which offer to accept. The boy has to decide which course is best for him but he also has to consider the cost implications of that decision. One offer will require the family to find about $4,000 a year more than the other course which calls for a nominal contribution. That's a significant sum for them, particularly because there are younger siblings, one of whom will be of university age while the eldest is still an undergraduate. The parents have said he should choose the course that he thinks will serve him best and that he should not concern himself with the financial side of things. No doubt he will have little appreciation of what it would mean from day-to-day to find $4,000 each year, but it is hard to imagine that even a teenager could leave it out of his thinking entirely.

For the parents the position is simple. Their son has an opportunity to go to a very good university and gain a qualification that, subject to his own endeavours, should equip him for a good career. They did not have that opportunity and will do everything they can to ensure their child utilises his. There is no scintilla of remorse, envy or bitterness that they will have to make a contribution towards the costs of tuition any more than their son feels such emotions at the thought he will have to find part-time work throughout his college years to keep himself in beer and condoms. American college students have a long history of taking evening and weekend jobs to pay their way. My experience is that they make excellent waiting staff at restaurants because they are bright and attentive and have enough about them to know that the more you please the customer the larger the tip is likely to be. Some go into prostitution, in which field the same rules apply.

Last week there was uproar among the professionally entitled when the London Metropolitan University announced a plan to cut the number of courses offered from 557 to 160. There is a delicious article in a newspaper local to FatBigot Towers giving a headline figure of 400 courses being abolished, with a first paragraph saying it is more than 400 and only by the seventh paragraph does the writer do the sums and work out that 557 minus 160 is 397 (here). The London Metropolitan University is an amalgamation of a number of former polytechnics. The greatest distincition achieved by any department of the constituent parts was probably the Law faculty at the City of London Polytechnic which was as good as that of many minor universities, but there is no basis for arguing that LMU is anything other than a make-weight new university. Why does anyone suggest it, or any part of it, is entitled to remain in being if it can't pay its way?

The contrast with the USA is marked. Universities over there are forced to close courses all the time when they don't attract sufficient paying customers. Most marked is that they attract paying customers who pay with their own money save where the university has funds which it allocates to those who show the greatest aptitude for the subject according to the judgment of the university itself. Now, I am not so blind as to ignore the existence of a degree of tokenism in US universities, especially where future funding is dependent on appearing to give advantage to minorities today; but that is all part of the same process - they sometimes take the wrong person and exclude the right person this year because doing so ensures 1,000 of the right people can be funded next year.

This field is one of a long list in which good intentions have combined with electoral bribes to create a situation in the UK that is fundamentally artificial. We seem to have, at least among the political chatterati, an established phrase that is treated as the starting point of all discussion about higher education, namely: "free university education". Any call for contributions towards tuition fees is seen as an affront to reasonable expectation because the assumed ideal is that all students should get whatever they want at someone elses expense. No sane person could ever talk of "free university education". University education is a hugely expensive business, it is not and never has been free. Someone has to pay for it. Over here the culture is that taxpayers should pay for it, over there the culture is that the student and/or his family have to pay for it.

Provided there is a sensible system of scholarships and bursaries for the promising but impecunious, those who deserve university places will receive them (yes, some will always slip through the net for more reasons than you could shake an elephant's willy at but that will always happen). Provided universities are dependent on people using their own money to decide which courses are worth paying for, they can remain in being but only if they offer good courses at a competitive cost. When both the customer and the supplier have their limitless demands met by the milk of the taxation udder you will get low-grade courses being followed by low-grade students to the benefit of nobody other than the very people who are currently making the most noise about the London Metropolitan University - udder suckers who can only maintain their positions with the near presence of a soft and generous teat.

As usual I have waffled all around the houses but I think there is one point about my friend's experience that is more important than any other. Her son's education is a private thing, it's funding is a private thing, both are sorted out in the family and between the family and the university. It is not the business of anyone else and it is not the responsibility of anyone else. The expensive dead hand of The State is nowhere to be seen.

And everyone is happy.

I prefer to have one vote, like everyone else

2011-04-16T04:48:00.003+01:00

We haven't had a nationwide referendum in this country since 1975, now we face one on our voting system and it's a pretty low-key, perhaps to some invisible, affair. A few days ago a leaflet plopped through the letter box from a quango called The Electoral Commission explaining what the referendum is about and, I thought very fairly, defining the differences between the current voting system and the alternative on offer. My first thought about the whole affair is that it is worryingly low-key, probably because it concerns a subject that stirs interest in very few people.

The previous referendum, on whether the UK should continue to be a member of the European Economic Community, was a very high-profile affair. It was a topic that split both our major political parties down the middle (as it does today) and was headline news ever since the UK joined the EEC in 1973. With the dishonest and bullying approach that has marked every step of the project to create a United States of Europe, the UK was signed-up to the EEC without asking the people whether they wanted it and a referendum was allowed only once membership became the status quo. Even if the matter had been approached honestly by holding the referendum before we were committed to the disaster that has become the EU, the importance of the issue would not have changed. It was a major constituional shift for this country. Switching from the established form of voting for MPs (first past the post) to anything else is also a major constitutional shift.

That other systems are used in various parts of the UK and in various other types of election is neither here nor there. The established position is that the person who gains most votes in each constituency wins a seat in Parliament and introducing any other method of voting goes to the heart of our flawed but well-established system. My natural conservatism says that, for all its faults, the established method should not be changed unless there is very good reason to do so. Not only should it be arguable that an alternative would be better, it should be clear that that is so.

This makes me ask what is wrong with the current system. Various faults have been suggested. I don't pretend that what I am about to say is exhaustive but there are two arguments which seem to be most commonly promulgated and to be more substantive than any others.

First, it is said to be wrong that some constituencies are so dominated by one established political party that they can never change hands under "first past the post" and that this deprives voters who do not support that party from having an effective vote. In a way the objection is fair. Some constituencies have a long history of returning an MP of one party with 50% or more of the votes cast so no other candidate can get close to winning. Being in such a constituency myself I am well aware of the "wasted vote" argument. This problem also arises where one party regularly receives less than 50% of the votes cast. At 49% there only need be 2% cast for third party candidates for 49% to be victorious and at 43% of the vote a further 8% going to assorted small candidates means 43% wins.

Secondly, it is said that in more marginal seats people do not always vote for the candidate they want to win but in order to prevent another candidate being successful. A Conservative-Labour marginal seat puts pressure on those who might wish to vote for a third candidate to vote Conservative if they want to keep Labour out or vice versa. Again, it is a fair objection in that people can feel the need to vote against their conscience in order to achieve a result which is not what they really want but is better in their eyes than the other possible outcome. They know their chosen candidate has no real chance, so they engage in a damage limitation exercise.

Both of these objections are, in my view, consequences of the constituency system and, to a lesser extent, of the dominance of the main political parties rather than consequences of the voting system.

For so long as we elect MPs for individual constituencies there will be instances of "safe" seats. Some places contain so many people of like mind that a socialist or a conservative will always triumph even if party labels change. AV seems unlikely to make an difference in such constituencies. Similarly, some seats will always be likely to return an MP of one party or another party, third party supporters know their chosen candidate will not win. AV might lead to more people putting their first choice first but it seems inevitable that they will use their second vote for tactical purposes. Typically under the present system a LibDem supporter who wants to keep Labour out will vote Conservative where the LibDem candidate cannot expect enough first choice votes to win and under AV he will either vote Conservative with LibDem as his second choice or LibDem with Conservative as his second choice. Either way, once all but the top two candidates have been eliminated (which will result in Labour and Conservative remaining in the race in almost all Con-Lab marginal seats) his current tactical voting seems likely to be replicated whether he put Con first and LibDem second or vice versa.

It is only when we look at seats that are genuine races between three or more candidates that AV might make a difference to the outcome. There is certainly an argument for such seats to go to the candidate who receives the least disapproval, although that rather goes against the grain in an age of pasty-faced political leaders who go out of their way to avoid giving offence and thereby avoid advocating any sort or position of principle. Charming personality politics gives us Blair and Cameron as Prime Minister, two men without a coherent political principle between them. AV seems designed to ensure that beige is the secret to success. I don't find that particularly attractive.

Even less attractive is a system that results in those who are polictically savvy having more of a say than those who are not. For those of us who enjoy politics and take more than a passing interest in it, the opportunity to place multiple choices would be a delight - not least because we can don an anorak, try to second-guess the likely result and use our choices to eliminate someone we don't want to succeed. Those with little interest in politics but a desire to be part of the democratic process will have no incentive to approach the subject in the same way. They might not think it necessary or appropriate to place a second, third or other choice. Under the present system all who bother to vote are in exactly the same position, they have one cross to place on a piece of paper and their cross will either be against the name of the winner or against the name of a loser. Under AV everyone has the option to place as many preferences as there are candidates but no one is compelled to use all those choices.

One thing I find genuinely exciting about a general election is that I am in exactly the same position as a multi-millionnaire and tramp. We each have one vote. I am in the same position as the most intellectually brilliant and the window-licker. We each have one vote. I am in the same position as the most knowledgable political analyst and the person who has no interest in politics at all. We each have one vote. I am in the same position as a person of noble breeding and the latest in a line of illiterate potato pickers. We each have one vote. I am on a par with the Prime Minister. We each have one vote. Talking of illiterate multi-millionnaire window-lickers with no interest in politics, I am in the same position as Premier League footballers. We each have one vote. I find it unpalatable that we might adopt a voting system that allows those who take an interest to have a more effective say than Mrs Muggins who gets on with her life but votes every time because she is proud to have the right to do so. If I could see an advantage to AV that outweighs this disadvantage I might be persuaded to vote for the change. All I have heard so far is that it might allow a more concilliatory result in some marginal seats. To my mind that is an irrelevance compared to the levelling benefit of every voter being in the position of having one vote.

Addendum
In the comments (here) the good Mr Wadsworth disputes my assertion that AV leads to some having more than one vote. The case he puts is as follows: "Under AV everyone has one vote in each round of voting. Although your ballot paper might be shuffled from your first choice candidate's pile to your second choice etc, that is your one vote being shuffled around and in the final round it will be counted once." That is patent nonsense and the reason why it is nonsense illustrates the objection I raised above. A simple example shows why he is wrong.

Let's say we have a four-way marginal, Lab, Con, LibDem and UKIP. Mr A votes only for the UKIP candidate, who is eliminated in the first round. When the second round votes are cast Mr A is not involved in the process because he has not made a second choice. Mr A placed one vote and it was counted only once. Mr B also chose UKIP but he put LibDem second. In the second round his vote remains in play because he made a second choice. One could say he has had two votes, but let's not quibble about that just yet, at each of the first two stages of voting he has had one vote. On elimination of the LibDem chap in the second round, he plays no part in the third round. Mr A is involved in one round only, Mr B is involved in two rounds but neither plays any part in the final round. It is, therefore, quite obviously the case that not every vote is carried forward, only those who have voted for one of the final two candidates (or more if one reaches 50% while there are still three or more people in the game) have their vote carried forward to the final round.

I do not consider it a matter of semantics to say that Mr A has had one vote, Mr B has had two votes and those who places the Lab or Con candidates somewhere in their list have had three votes. Of course it is true that at each stage any one constituent has only one vote but that does not change the fact that some continue to have a say while others have their votes discarded because they did not make a sufficient number of choices to remain in play.

It is interesting to note that no commenter has yet suggested what benefits AV is meant to bring.

Back to gardening

2011-04-04T03:30:00.003+01:00

The human mind is a wonderful thing, but its powers are not always benign. Gardening has been a great love of mine for as long as I remember. As a small child I planted, weeded and watered and then felt great excitement as the seeds I spread a month or two earlier produced flowers. Of course a month or two is a very long time when you are little, the long wait could disappoint and discourage some but for me the thrill of the finished product was well worth the wait. In my early adult years gardening was off the agenda because I had no garden and was too busy establishing my own grown-up roots. Once I was settled there were regular trips down to the FatBigot ancestral estate (a small three-bed semi in a Sussex village) to take up gardening duties as the parental generation became less able to cope.

It was on moving into FatBigot Towers nearly twenty years ago that I had my own garden for the first time. The previous owners had cultivated bindweed, brambles and elders to a standard that could have earned fellowships of the Royal Horticultural Society, so my first task was to clear out all the crud. On doing so it became apparent that the wall along the north boundary was utterly decrepit, an appearance that was enhanced by a large chunk of it falling as soon as it was touched. It makes the garden seem much larger than it is to say that the wall along one side required more than three thousand bricks to be laid and the use of more sand than you can shake a trowel at (together with a little cement and a vast quantity of hydrated lime). Now the fruit of my modest bricklaying skills is still standing and has weathered beautifully.

For more than a decade I mowed, sowed and hoed at every opportunity even building myself a greenhouse and creating three compost heaps - one for stuff currently rotting, one for stuff rotted and awaiting use and one for leaves. Then I suffered a cardiac unfortunance after a weekend of hard graft thinning the hedge around the front garden and shredding the detritus so that it would compost down at double quick time. And that is where the human mind came into play in my gardening. Saturday - panting and sweating while cutting the hedge; Sunday - panting and sweating while shredding the trimmings and incorporating them into the compost heap; Monday - heart attack. My poor brain linked vigorous gardening activity with intense physical pain.

Since then I have ventured into the garden a couple of times and done a little general trimming to prevent it becoming a jungle and this time last year I had a good go at the hedge again, albeit at a slower pace than before and less extensively than the previous thinning (which was somewhat overdue). Only now has my mind allowed me to tackle the back garden thoroughly. It was my intention to do so last year but on starting I realised it was causing me more worry than it should. Six years is a long time in the life of a garden so I knew there would be a lot of remedial work required before there was any chance of restoring it to its former glory (which wasn't, in all honesty, particularly glorious).

Last week I ran into someone I know who used to work at a Turkish restaurant very close to FatBigot Towers, he said he had just finished working at one place and was due to start a new job next week. The offer of a bit of cash turned him into a gardener for a few days, tackling the toughest parts of the clean-up job and generally clearing the site ready for more intricate preparatory work to be done. Many years ago the great Geoff Hamilton explained that once you get your garden soil into good condition it will remain good for a long time and will need very little additional work each year compared to the work involved in its initial preparation. How true that is, my old flower and veg areas still have light crumbly soil despite years of neglect. It allows the weeds to thrive but also makes it easier to remove them.

I am not planning to be very ambitious. In the flower beds I will clear perrenial weeds, add as much compost and conditioner as I can, preserve the best of the perennials, prune and feed roses and then just sow mixed cottage garden annuals to get two or three months of colour. The veg patch will have spuds, lots of spuds, and a wigwam of runners (always Scarlet Emperor for me). No doubt bindweed and dandelions will pop up in far greater quantities than I would like. Oh well, there's no escaping the old enemy when you have given them free rein for so long. The lawn will get a spring weed and feed treatment and then regular cutting.

The last three days, in which my Turkish assistant worked magnificently hard, have left me with a manageable project. Now my mind is working differently. It is dredging up memories from years ago about how to start a new garden and is reminding me of just how enjoyable and satisfying the exercise was first time round.

It's Prince Andrew's job, not his fault

2011-03-08T22:44:00.005Z

Few things grate my adenoids more than self-righteous priggery. For the last week or so stories have abounded about Prince Andrew chummying-up to corrupt foreigners in his capacity as an honorary trade envoy and there has been much snarling about our current and former governments being too polite to Libya's mad dictator. The reality is that we have to deal with whoever we have to deal with in any given country, and for much of the world that means some pretty nasty little shytes, the alternative is the loss of business to those who are not so uptight.

In this field there is a substantial overlap between government and business although government's position extends far beyond trade links. Everything is a matter of practicalities. Either we maintain diplomatic links and converse with the head of state or we don't; there are very few situations in which severing diplomatic relations because the incumbent egomaniacal kleptomaniac in Outer Bongobongoland is of greater benefit to the UK than biting our tongues and pretending to be nice to him while working to make sure we get as much as we can as a result. Everyone has known Gaddafi to be bonkers for decades. So what? He's bonkers but he's in charge so if we wish to deal with Libya we have to deal with him no matter how repulsive he is. The same applies to the tin-pot dictators of almost all the oil states and those of almost all countries in Africa. A thin veneer of democratic authority in parts of Africa does not mask the simple fact that whoever wins the election will be no less corrupt than the losing candidates and no less corrupt than the likes of Gaddafi in Libya and, until recently, Mubarrak in Egypt. If it comes to that, these people are not very much more corrupt than the leaders of many mainland European countries. It is unthinkable to break-off relations with Italy or France yet the levels of personal corruption among their senior politicians make a few million in fiddled Westminster expenses seem like feed for the chickens. The situation is a classic one of keeping your friends close and your enemies closer. The more we interact with them the more chance we have of being able to make a tiny little difference when it really matters and, more importantly of keeping the benefits of trading with those who have products we want and markets we need.

I sometimes wonder whether suggestions (and even laws) that British companies should not pay bribes are made seriously. If you are driving through France and are stopped for speeding when you have kept religiously to the limit you know the policeman who stops you has no more desire to issue a ticket than you have to receive one. He wants to open your passport and find a crisp 20 Euro note inside. Having inspected your paperwork and retained that of greatest importance to him he will wave you on your way. Oh how wickedly corrupt, the prigs will say, no doubt they would choose to delay their journeys and pay three times as much for the privilege of an endorsement on their licence; like buggery they will, they will pay the bribe and tut-tut over their tofu for weeks. There is no difference between that situation and a business greasing palms in order to secure a contract. It's a matter of practicalities. That's how business is done in some countries whether we like it or not and we either play the game or lose the deal. Of course commercial reality still triumphs and bribes are paid in more indirect and subtle ways than a wad of cash in a brown envelope.

Over the last two days the front page of the Times newspaper has featured criticism of Prince Andrew's cozying-up to dubious senior figures from a number of unsavoury regimes. One has to ask whether he would be doing his job if he didn't give these people the treat of meeting his mummy or the hint that she might proffer them a cup of tea and a cucumber sandwich at a convenient juncture. After all, there's not much point giving the role of trade envoy to a Royal with no business experience unless his royalty were used to seek advantages for British companies in highly competitive markets. There is nothing else he can offer to the job so it seems implicit in his appointment that this is exactly what he was meant to do - although no one would ever be so crass as to actually say he was expected to do it.

Equally misplaced is excessive criticism of the pathetic current leader of the Labour Party for heaping odious praise on Gaddafi's corrupt son prior to a lecture at the London School of Economics. It would be entirely fair to observe that socialist politicians will always heap praise on any overseas despot provided that despot calls himself a socialist. No matter how brutal and repressive he might be, these poor fools go dewy-eyed once the S word is spoken and see nothing but benevolence and a desire to fight the enemies of "the people". Exactly the same conduct by a political leader who denounces socialism is, of course, a crime against humanity and an affront to basic human rights. The magic S word is all it takes to define two identical things in opposite ways, but that's what happens when you are in thrall to an irrational religion.

The reality is that the UK has no practical option but to try to get on with all countries around the world if it can, and that means being far more friendly to vile political leaders than a purely human response would allow. If we are honest about it we can see exactly the same thing happening in every aspect of international relations including sport - who would think of pretending to be delighted to meet the puffed-up heads of the International Olympic Committee or FIFA unless they had to? There is no choice unless you are prepared to abandon your interests and see the largesse of the corrupt and powerful leaders being dispensed elsewhere. Unpalatable it might be, but sometimes real life is exactly that. We should not have a go at those who suck-up to scum on our behalf; we'd have to find a way to do it ourselves if they didn't do it for us.

Insurance premiums and Euro ideology - part two

2011-03-04T06:05:00.005Z

My previous offering (here) did not cover one aspect of the debate about the effect of the decision of the European Court of (so-called) Justice in case number C236/09. As I said then, the court decided that the premiums charged and benefits paid under insurance policies must not discriminate between men and women. In other words, men should never pay more or less than women simply because they are male and women should never receive more or less than men simply because they are female. I offered some views on the premium issue but said nothing about benefits.

The good Mr Pogo raised a matter in the comments (here). He observed that annuity rates are generally more generous for men than for women and wondered whether the court's ruling would require this to change. The answer, I think, is that it depends whether an annuity is an insurance policy.

As I understand matters personal pensions work as follows. An individual pays contributions to a third party in order to build a fund from which a pension will be payable if he lives long enough. He could just save the money himself, but by paying it to an approved pension fund holder he is allowed to claim tax relief for his contributions. The pension fund holder collects the payments, invests them as well as it can, take a chunky commission at every stage and accounts to the contributor every year with a statement explaining just how little is being held in the fund. Each pension policy has a defined end-date. Provided the contributor has reached the age of 55 he or she may receive something back (it used to be 50 but is now 55). If he or she is younger than 55 at the relevant date, the fund is closed and the accumulated lump-sum is invested until he or she hits the magic age. At that time the policy matures.

I don't pretend to know many ins-and-outs of insurance law, but believe it is correct that these pension arrangements are a form of insurance. All insurance involves two factors: (i) you pay premiums and (ii) you are entitled to receive a payment if the thing you have insured against occurs (be it a burglary, a disease or, as in the case of pensions, reaching a certain age despite modern science decreeing that to be impossible because you smoke and drink). Entitlement to receive anything under a pension plan is dependent on a contingency and for that reason I believe it correct to say that pension plans are a form of insurance.

Insurance can entitle you to a fixed sum (you might pay premiums that entitle you to £5,000 if you break a leg bone - no matter which bone or how seriously it is fractured, you get the same sum) or to recompense for loss (as with home contents insurance), or to protection against claims others take against you (as in the case of professional indemnity insurance), or it might entitle you to a variable sum depending on how well the insurance company has invested its receipts. This latter course is how pension policies work. The heirs of those who die before the maturity date of the policy might or might not be entitled to claim a lump sum by way of refund and they might or might not make a claim, in any event some money will be left in the fund by those who cannot or do not get a refund. Some investments will be good, others will be bad. The fund will be what it is at the date a policy matures and the policyholder will be entitled to a lump sum calculated according to the state of the fund at that date.

When the policy matures, the policyholder is entitled to a lump sum but, if he claimed tax relief on his contributions, he is not entitled to receive it as a single lump sum. I believe a certain percentage can be taken in cash but the rest has to be used to buy an annuity. Many think this requirement iniquitous, but that is not the point of today's missive. The point is that the insurance policy comes to an end when the lump sum is calculated and paid. It goes without saying that all insurers large enough to administer pension funds also offer annuities, but their customers cannot be required to buy one of their annuities. The customer is entitled to a lump sum but must take that lump sum in the form of AN annuity, not any particular annuity. The purchase of the annuity is a separate transaction from the allocation of a particular lump sum to a particular policyholder on the date the pension policy matures.

At that date the policyholder has the benefit of a sum of money. Provided that sum of money is not calculated differently according to whether the policyholder is male or female it will not, I think, fall foul of the ECJ's ruling.

When it comes to buying an annuity men tend to get better terms that women because we don't live as long. Whether being the recipient of nagging shortens life or delivering nagging lengthens life really doesn't matter, it might even be a combination of the two, but the fact is that blokes generally don't live as long as gals. Annuities reflect this reality by giving men slightly better returns. It seems to me that that will not fall foul of the ECJ's decision unless annuities are insurance contracts. I cannot see that they are.

An annuity is a contract under which you pay a company a lump sum in return for being entitled to an income (paid weekly, monthly, quarterly or annually) for life. An annuity is no different from the cash-for-equity deals that are available to homeowners of a certain age. You make your house over and in return are entitled to a defined sum each year for as long as you live, it might even be index-linked, and you are also entitled to remain in the house. There is nothing about this that seems to me to equate it to insurance any more than purchasing an annuity is insurance. It could, I suppose, be argued that the lump sum is a premium and the receipts are benefits that depends on the contingency of longevity but that involves a contingency that causes payments to cease rather than one that caues payments to commence - and an essential feature of insurance, as I understand it, is that the entitlement to receive a benefit rests on a contingency other than payment of the premiums.

If this is correct, annuity returns are not caught by the ECJ ruling.

It's only a matter of time, of course.

Insurance premiums and Euro ideology

2011-03-02T23:24:00.002Z

It is not often that men come out on the right side of anti-discrimination laws, but the slavish adherence of the European Court of Justice to a flawed principle seems to have produced exactly that result. I am, of course, talking about the recent decision that insurance companies are not allowed to discriminate between men and women purely on the grounds of gender when setting premiums or paying benefits.

The judgment itself (here) is clear. Where the position of men and women is comparable they must be treated the same. Where their positions are not comparable they may be treated differently. Who decides when their positions are and are not comparable? Well, the institutions of the EU of course and they have decreed that the situations of men and women are comparable when it comes to setting insurance premiums and calculating benefits payable under a policy.

In some respects this is patently absurd. Women are at greater risk of thefts in the street, (for example, handbags are easier to snatch than wallets in jackets) young men are at greater risk of crashing a car, men are at greater risk of dying younger, men are at greater risk of injury around the house (they climb on chairs to fiddle with electric fittings whereas women climb on chairs to scream "eek" at the sight of a mouse). These disparate levels of risk exist between the sexes but it is not their gender that causes the disparity it is their behaviour and different patterns of behaviour present different risks of an insurance policy being called upon. Because, generally speaking, men behave differently from women men present a greater risk for some types of insurance and a lower risk for others.

Throughout the world these self-evident facts have conventionally been reflected by higher premiums being payable by those most likely to present a claim. There are two aspects to this because insurance operates in two ways. On the one hand, some insurance exists primarily to pay the policyholder a defined sum in the event of certain things happening; for example you can take out insurance that pays you a lump sum in the event that you break a leg or suffer a heart attack, or you can insure the contents of your home so that you receive some money if you are burgled and your stuff is nicked. The only beneficiary of such a policy is the policyholder himself (leaving aside the right to nominate a different beneficiary but there are limits to when and how that can be done). On the other hand some insurance exists primarily to provide protection to third parties against damage done by the policyholder. Lawyers, architects, accountants and others have to carry insurance so that anyone suffering due to their negligence can be compensated; similarly car drivers take out insurance not just to compensate them in case a crash occurs but also to ensure that innocent third parties can be compensated. Strictly speaking third parties are not entitled to claim against these indemnity policies, instead the policyholder is liable to pay compenation and the insurance company provides the funds from which he pays it; although the reality is that the insurance is for the benefit of the third parties.

Whether insurance is primarily for the benefit of the policyholder or third parties, it involves shifting risk from one person (or group) to another. If you have no household contents insurance the removal of your goodies by little Johnny Toerag causes you a loss and you have to dip into your own pocket to replace the missing things, the risk is yours alone. By insuring against burglary that risk is spread among all policyholders. Equally, negligence by an architect might cause millions of pounds of loss which will fall initially on the owner of the building; the owner can sue the architect but will he have the money to pay? Perhaps not, so he has professional indemnity insurance to ensure there is a fund from which his "victim" can be compensated. In that case risk passes from the owner to the architect to all those who have paid premiums into the relevant fund.

There is no single principle by which the fairness of the spread of risk can be assessed but the conventional approach is to charge higher premiums to those who are more likely to make a claim and lower premiums to low risk customers; in addition the greater the size of any potential claim the greater the premium. Different people, and different insurers, can take widely divergent views about how premiums should be weighted. Some might think it fair for everyone to pay the same premium, or for premiums to be graded according to the income of each policyholder, or to vary according to the area in which the policyholder lives, or according to his age or his occupation. Arguments can be made for each of these factors to be given particular weight in certain situations. What is considered fair is a matter of opinion and opinions necessarily vary.

I have read a lot of comment in the last few days about the judgment of the ECJ being unfair to young women drivers who, apparently, are much less likely to make a claim on their motor insurance than young men of the same age. It certainly appears to be the case that insurers will not be able to charge young men higher motor premiums than young women because that would involve unlawful discrimination on the basis of gender. I find this a slightly confusing concept. There is a reason why young men's premiums are higher - it is because, as a class, they are more likely to make claims. Not every one of them is a menace, but sufficient are to make them a risky group - not by way of anecdote but by way of hard evidence about the number and type of incidents in which they are involved. That is fact, that is reality. For reality to be cast aside in favour of a political ideal strikes me as highly unappealing.

Having said that, all weighting of insurance premiums requires judgments to be made about what is and is not fair. When I last had a big car and its insurance was due for renewal I obtained quotes varying between about £350 and just under £2,000. Same car, same location, same driver with decades of experience and not as much as a speeding ticket, yet one insurer assessed the risk I posed as requiring a premium five times higher than another. No doubt each felt they were chrging what was fair in the circumstances.

We shouldn't get too uptight about car insurance. Maybe premiums will go up substantially for young women, maybe they will fall a bit for young men, maybe they will rise for older people to allow premiums for the young to find a level between the current male and female level. Whatever happens there will continue to be wide differences between insurance companies' charges.

More troubling is the illustration given by the recent ECJ case of the consequences of pushing ideology into areas that are none of its concern. I have no problem with the concept of men and women being treated equally by the law, but I find it ludicrous that the law requires anyone to pretend that differences that actually exist as a matter of fact between men and women do not exist. There might be a simple way to avoid this absurdity. It arises only because the EU has decreed that the position of men and women is comparable so far as insurance premiums are concerned. As a matter of fact that is simply not the case, at least it is not the case when it comes to motoring premiums. The EU could, were it so minded, allow insurers to charge men and women different premiums where there is clear evidence that men present a higher risk than women or vice versa. That, indeed, was the position until it was struck down by the ECJ because it was inconsistent with another provision of EU law.

If we have to have EU law (and the sooner we don't, the better) it should at least try to reflect reality. I doubt that it can ever do so to a sufficient degree to gain public support because it is systemically ideological rather than practical. It is not just Middle Eastern despots who can only bully their subjects for so long before they are ousted.

Breaking news - HBOS doesn't lose £500 million

2011-02-22T23:43:00.003Z

It was announced yesterday (see here) that Lloyds Bank, the lucky owner of HBOS (Halifax Bank of Scotland), will have to pay around £500million to HBOS customers who took out a particular type of loan. The long and short of it is that customers were told they would be given notice if HBOS changed its policy from charging a maximum of 2% above base rate to charging 3% above base rate. The policy was changed, as they were probably entitled to do, but notice was not given to all customers who were told they would be given notice. Nonetheless, 3% above base rate was charged. Lloyds has agreed to compensate those who paid the additional 1% but were not given notice.

On the face of it the position is very straightforward. Whether or not customers would have sought a replacement loan on being informed of the change, they would have had the opportunity to do so. As it is they were deprived of that opportunity. Had they been given notice it seems fair to presume that some would have found another lender and ended up paying less than the amount they paid Lloyds, some would have found another lender and ended up paying more than to Lloyds, some would have switched to a different type of loan with Lloyds and some would have just left the original loan in place and paid the extra interest. There is no way of knowing how many would have fallen into each category although it is probably not unrealistic to suggest that most would have left things as they were and just paid the higher interest charge. After all, base rate had fallen substantially and 3% above base was less than many had been paying a year before when the mark-up was 2%.

If this were looked at as a claim for breach of contract the assessment of compensation would be fiendishly difficult. Leaving aside the question whether there was any breach of contract, compensation would have to be calculated by trying to value the loss of opportunity to switch mortgage from Lloyds to another lender or from one Lloyds mortgage product to another. The position would be different for different borrowers, depending on their own financial circumstances and the degree to which they would have been likely to seek out an alternative loan. Few would have been entitled to repayment of the whole of the additional 1% they paid although it is theoretically possible that a very small number would have been able to prove a case for a larger sum (if they were able to satisfy the court they would have switched to a loan charging less than 2% over base).

Reports say up to 300,000 HBOS customers were affected. It would make no sense (except to the bank managers of the lawyers involved) to have 300,000 separate claims. Were this dealt with by way of claims for breach of contract there would be only one claim in which all customers who showed interest would be involved. "Class actions", as these cases are known, are relatively new beasts to the English judicial process, we see them most often when a large number of people suffer personal injuries due to the same cause - perhaps a drug that proves to have bad side effects or a work practice that causes many employees to suffer illness or injury. Although the accuracy of the compensation in each individual case is somewhat rough and ready the process is generally quicker, certainly much cheaper and has the added advantage of everyone knowing their case has been considered in the same way as everyone else's.

The intervention of regulators of businesses such as banking means that legal claims do not always need to be made, the regulator can step in and require redress to be paid for an apparent wrongdoing. This, of course, is what happened in the present case. We will probably never know how much pressure was applied by the regulator and how much the decision to offer compensation was motivated by either a genuine sense of the need to do the right thing or exasperation at Lloyds with the shabby practices of HBOS and it does not really matter. A problem was identified, a solution worked out and litigation avoided.

At the heart of the solution is the implicit assumption that HBOS/Lloyds should not have charged an extra 1% interest without giving notice to their customers. Whether they were entitled to do so in law is not the point, they said they would give notice and they did not; of itself that is bad practice and, some would say, fundamentally unfair. The amount they received from customers by increasing their margin seems to have been around £500million. They simply should not have received that sum in the first place. Had they followed good practice they would have received the money and would not now be liable to repay it, as it is they should not have received it and now must repay it.

In making the repayments Lloyds will not be losing anything they will simply be handing back money they should not have received. It is quite wrong to think of this as a loss. Any loss is purely hypothetical and results from not giving the promised notice - had it been given they would have received £500million, by not giving it they have lost £500million, except they haven't. By not giving notice they lost the chance of receiving up to £500million but they did not lose any money. By not investing one pound on the numbers 6, 16, 26, 32, 33, 34 and 46 for last Saturday's lottery you lost £4million - that is not a loss it is a failure to make a profit that would have ensued from doing something other than what you actually did.

Captain Ranty's "Legal Fiction"

2011-02-15T01:56:00.003Z

I have been reminded by the good Mr Wadsworth (here) of a recent posting on the site of the deliciously entertaining but occasionally deranged Captain Ranty (here). In the piece highlighted by Mr Wadsworth the Captain made a bizarre and patently absurd assertion, namely that a judge in a County Court had made a finding in law that there is a distinction between between someone calling himself Roger Hayes and living at a particular address, let's call it 34 Acacia Avenue, and Mr Roger Hayes who has been billed for Council Tax at 34 Acacia Avenue.

The case to which he refers involved a claim being made in the County Court and I infer the local council had issued a summons against "Mr Roger Hayes" and served it at 34 Acacia Avenue claiming whatever sum of Council Tax for 34 Acacia Avenue had not been paid. I also infer that the only adult human being who is both known as Roger Hayes and lives at 34 Acacia Avenue attended court. When there he claimed not to be Mr Roger Hayes and not to be liable to Council Tax for 34 Acacia Avenue because he was Roger Hayes, the human being, whereas Mr Roger Hayes is legal corporation but not comprised of flesh and bones. I don't propose to waste a good keyboard on explaining everything that is wrong with this manifestly ludicrous proposition, save to say it has no merit in law and is almost certainly unfounded in fact (for example, I'll bet you a pig to a pork scratching that the human being has acknowledged himself to be Mr Roger Hayes hundreds if not thousands of times and has benefited from doing so - in passing, I wonder whether he has a bank account and, if so, whether the bank records the account as being that of Roger Hayes or Mr Roger Hayes, if the latter poor Roger would be liable to repay every penny he has ever withdrawn). What I want to explain is what the judge's conduct of the hearing amounted to.

By way of background, I should point out that nothing Captain Ranty or (Mr) Roger Hayes are saying today is at all novel. Every year the courts hear these and similar arguments being put forward in a vain attempt to challenge either the right of the court to hear the case or the very concept of enforceable law. Friday afternoons are reserved for such people by the procedural judges (known as Masters) of the Queen's Bench Division of the High Court. The arguments range from demands that the judge provides evidence of his appointment followed by a refusal to accept that the judge is a judge unless he can do so, to assertions that certain Acts of Parliament have no effect because they contravene Magna Carta, to attempts to get one judge to re-hear a case that has already been heard by another judge, and all sorts of nonsense in between. Experience shows that the best thing to do is sit back, let the barmy argument be put and then get on with the case. Frequently this involves adjourning the matter to a later date on the ground that further evidence is required on one point or another or because the court has run out of time due to the spouting, at great length, of unmitigated tosh by the misguided litigant. In some instances these adjournments are made in the hope the nutter will give up, and sometimes they do.

The choice for the judge is to allow the rubbish to be spouted, or to try to prevent it being spouted. No third way exists. Trying to prevent carries risks because the litigants are often either unstable or obsessed or both. Neither County Courts nor the High Court are usually staffed by a six-foot bouncer with a stun gun, instead they have an usher who is more likely to be a lady in her late fifties called Enid with no weapon more effective than a clipboard and a ballpoint pen. No judge is going to put his or her staff at any physical risk if they can avoid it, so the path of least resistance is adopted. This involves trying to dismiss the point briefly in the hope the annoyance will accept the indication and go away, but if that fails it is safer to allow them a "day in court". That does not mean that any credence at all is given to the eccentric theories being expounded, far less does it amount to an acceptance of those theories or that the person arguing them has any legal right to appear in the case at all. It's all a matter of practicalities. Years ago judges tended to be somewhat brusquer on average than they are today, yet even the most robust would show their greatest politeness when faced with a litigant in person barking up the wrong end of a very sturdy tree.

Nothing in the case referred to by Captain Ranty hints for even a second that the judge accepted any part of the fanciful arguments being put in front of him. Rather, it is a classic case of a judge trying to get a nutter to go away and then sitting back resignedly and facing the unappealing fact that the nutter will persist and should be allowed to do so to prevent any unpleasantness and/or the wasting of even more time by another judge being faced with exactly the same scenario at a later date.

We really do need a property crash

2011-02-14T02:48:00.003Z

I was musing the other day about what FatBigot Towers would command on the "open" market if it's value had increased at the rate of general inflation. Of course there is no way of knowing because there is no such thing as a single rate of non-housing inflation - it all depends what products you include in the calculation. To arrive at some sort of figure I googlised "UK inflation since 1993" and found a fun site that allowed me to find the value in 2010 of any given sum at an earlier date (here). I know not how accurate it is, but it's fun anyway.

What I found is that the rates of inflation used at that site indicate FatBigot Towers to have increased in "value" by almost two and a half times general inflation. That really is an absurd state of affairs, not that I mind because free money is free money and I might get around to cashing it is in the not too distant. One factor that needs to be borne in mind is that I purchased my modest hovel at a time when prices had fallen substantially and the market was extremely flat, prices could well have been below a fair market price due to suppressed demand. The vendors, who were and are friends of mine, had found their ideal property and beaten the price down substantially, they also had not needed to use estate agents, so it might well be that I paid a bit under the odds. Even so, FatBigot Towers would seem to be "worth" well over twice what it would have cost today had house price inflation been roughly in line with general inflation.

I can understand why the current government feels it would be politically dangerous to allow the property market to correct itself. We had a decade of Blair and Brown telling people they were rich because their houses had gone up in value, boom-and-bust was a thing of the past, caution was thrown out of the window and a lot of debt additional to house-purchase loans was secured on homes. That sort of thing gives rise to expectations. The government had made them so much richer than they were before, they thought, and if they still hold that view there is every likelihood that they will consider the government to have made them poor if prices crash to a sensible level.

The position is a little different to that of twenty years ago. The price bubble is much larger than it was then and far more people have dipped into the bubble to pay for holidays, cars and electronic goodies. Although a lot of loans have been repaid since things went bang that process has itself made people feel poorer, so adding a drop in house prices to the pot would risk adding insult to injury. There is also the psychological effect of the sums of money involved. Twenty years ago a property previously priced at £200,000 might have fallen to £140,000, that's £60,000 and no one sniffs at that. By contrast, today the equivalent sums for the same property might be £400,000 and £280,000; £120,000 is so much more, not least because it is six figures rather than five. The general inflation calculator I linked to above says £60,000 in 1991 is equivalent to £96,000 in 2010; for the loss to be £120,000 not £96,000 gives the impression things are worse even though the same percentage of bubble has been removed in the two examples.

Looking back to the early 1990s I cannot recall any significant political backlash as a result of the property market collapsing. It had collapsed by the time of the general election in 1992 but the incumbent government won a majority (albeit much reduced). All the usual suspects were bleating on about people losing their homes but when details were given it became apparent to all that the genuine stories of bad luck were accompanied by many more of people borrowing more than they could afford to repay. In those days that seemed to be considered the fault of the borrowers rather than the lenders. Interest rates soared because base rate reflected the state of the government's finances and the ERM farce had rather pissed in the soup in that regard. Nonetheless, the government got back in and, not least because bad debt had been written off rather than carried over, it took only a few years for the nation's finances to be on a very sound footing.

The whole mood seems to be different now. No doubt it is due in part to so much of life now being tied into government activity. Never before have so many been dependent on government for so much of their income - due in large part to the evil tax credits scheme. And never has government presented itself as having magical powers to solve all ills as it has over the last ten years or so. A problem arises and government appoints someone to deal with it and/or throws money at a quango to solve it. The problem usually doesn't go away and the level of amelioration provided in return for the taxpayers' buck is pitiful, but the problem is now in the hands of government. No other solution is affordable because no one has the money government has, and failure to solve the problem can only be explained by not enough tax having been thrown at it. And we are led to believe that more and more of life's problems are under the control of government because they have outlawed this, regulated that and have an army of day-glo jacketed wardens imposing fixed penalty notices for everything else. No solution exists other than government. Two consequences follow. First people believe government can control things it actually has no ability at all to control and, secondly, any problems that remain are placed firmly at the door of government whether or not it is realistic to do so.

Allow a collapse in the bogus wealth contained within the house price bubble and government runs a huge risk to its chance of surviving the next election. Or so it thinks. Maybe it is correct in that thought although I have my doubts. I talk to lots of people about these things, not just fellow pompous barristers but ordinary people doing ordinary jobs to support themselves and their families. The only people I hear supporting government involvement in everything are the "liberal" Islington chatterati who seem to have the view that only they are capable to supporting themselves and everyone else, all the little people, need a massive network of support and counselling in order to boil an egg. The people doing ordinary jobs just want to be taxed less and left alone to look after themselves. It does not, however, follow that they would vote for a governing party that withdrew all the nannying unless it also reduced their tax bills.

Against that background I can see why the current government will not step aside and allow property prices to fall to affordable levels as their predecessors did two decades ago. Ironically, the one thing they want to achieve is more economic activity in the country and a thriving property market helps achieve that because moving home always involves the purchase of new stuff for the new abode. A thriving property market is one in which there are many transactions and has nothing to do with the nominal value of each transaction. At the moment the complaint of those involved in the business of property is that few transactions are taking place. Were prices more realistic it is reasonable to infer that there would be more. The other side of the coin is that some would be lumbered with negative equity and would be unable to move or would even face insolvency. It happened before and things soon recovered. You cannot set economic policy by trying to protect everyone from ever making a loss on a deal - well, actually, you can but you would create something nearly as bad as the mess Gordon Brown left the country.

In this respect, as in many others, I despair at the lack of guts displayed by the current government. They know houses are grossly overpriced and that the result is the current generation of young adults being priced out of the market completely unless their families already have money. They also know that all sorts of businesses benefit from property transactions - builders, painters and decorators, carpet suppliers, white goods suppliers, garden centres and a host more; their trade is suppressed if the property market is suppressed. Although it would be a short-term political gamble, a government of principle would say it is the right thing to do and would explain why. My money would be on that position being accepted by far more floating voters than the number who reject it. In any event, and I know I am dreaming here, I wish that just once we had a government that looked to the interests of the country rather than to its own electoral prospects when deciding policy.

Today's bad word - "diversity"

2011-02-04T02:20:00.007Z

On Thursdays the Times newspaper has a Law section containing snippets of legal news and gossip, the profile of a lawyer who has been involved in a recent newsworthy case and a main article dealing with an issue likely to be of interest to members of the legal profession. This week's article highlights concerns expressed by the Lord Chief Justice (the conveniently named Lord Judge - incidentally, we also have a Court of Appeal judge with the surname Laws) that too few solicitors from high-powered city firms are applying to sit as judges and too few people of high quality are attracted to criminal and family work because the pay is poor.

The article appears under a sub-heading reading "The Lord Chief Justice is worried about the diversity of the Bench" and was illustrated with a column listing the number of women and former solicitors sitting at the different levels of the judiciary. I cannot speak for Lord Judge but I think both the sub-heading and the illustrative numbers are misleading. Not only can I not speak for Lord Judge but I do not know him personally and can interpret comments he made only against the background of his well-known reputation at the Bar. Somehow I doubt that "diversity" of itself is his desire. Indeed, I think it impossible that diversity could ever be his desire although it could be a pleasant consequence of the system of judicial appointments. My point is about the whole concept of "diversity" and the way it is interpreted in the article in the Times because I believe it has been misinterpreted.

Let's take a heart by-pass operation as an example of what I mean. If you need one, what would you expect of the surgeon assigned to carry out the procedure? Well, that's simple, you would expect him or her to be at least basically competent at heart by-pass operations. That's all. Male or female, dusky-hued or blotchy pink, old or young - all irrelevant; they should be able to do the job. Then let's ask who should be appointed to a vacant cardiac surgical post. That's also simple, it should be the applicant who is best at the job. Male or female, dusky-hued or blotchy pink, old or young - all irrelevant; ability should be the only guide. It is only by appointing the people best able to do the job that the customer (patient) can have the greatest chance of being sliced and spliced by someone who is likely to do it well.

So also with the judiciary. Different types of judges deal with different types of work, some of which require a vast amount of technical knowledge of relatively narrow fields of law and others of which are more concerned with the management of evidence. If the Chancery Division of the High Court needs a new judge because an established expert in company law has retired or been promoted it would be no surprise to find an expert in company law appointed to fill the gap; you would not find a criminal law practitioner being appointed because, no matter how brilliant he or she might be in their chosen work, the skills and knowledge they have developed in practice would not make them suitable for such a specialist judicial post. The only question should be "which of the applicants will do the job best?"

Whether the result is that heart surgeons or judges comprise the same proportions of men and women, dusky-hueds and blotchy pinks and fortyishs and sixtyishs as the population as a whole is neither here nor there.

That is not to say we should not ask "why are so few women / ethnic minoritists applying to be judges?" Of course that question should be asked because there might be something about the application prodecure or the judicial work itself which deters suitably qualified people and that the obstacle is especially high for women, the darkly pigmented or, indeed, any other category of potential applicant. The only way to deal with such an issue fairly is to amend the procedure or introduce different working practices for judges so that suitably qualified people of all types can apply and know they are competing on a level playing field. This is to approach the issue of "diversity" from an inclusive frame of mind. You keep the quality standard and do what you can to ensure as many people of the required quality are involved, no matter who they are.

It is a different thing entirely to start from the premise thay we must have a judiciary that is "diverse" and treat that as an end in itself rather than a desirable consequence of a fair recruitment system that always appoints the best candidates regardless of any minority label that some might wish to attach to them (or that they might wish to attach to themselves). To treat diversity as a criterion for selection is, necessarily, to exclude some better candidates because they carry no such label and that is a worse vice.

One reason Lord Judge is the Lord Chief Justice is that he is a hugely fair man. Over his long career in the law there has never been a hint that he would treat someone less fairly because they happen to be female, dark-skinned or have non-standard sexual tastes. Nor would he treat a blotchy-pink heterosexual male less fairly than anyone else. He is, in my view, someone who looks on "diversity" of the judiciary as a desirable end of a selection process based purely on merit. Indeed, in order to be based purely on merit it is necessary for the process not to discriminate against anyone by reason of them falling into a numerical minority for one reason or another.

Having spent some time mulling-over the column of judicial statistics, I am hard-pressed to see its relevance. What it shows is that only 1 of the 11 Supreme Court Justices is female (actually it's 1 out of 12), 3 of 37 Court of Appeal judges, 16 of 108 High Court Judges, 87 out of 680 Circuit Judges and 110 out of 448 County Court District Judges (there are also 143 District Judges who sit in the Magistrates' Courts but no figure is given for the number of those who are female). On the face of these figures women could be said to be discriminated against; but who are the applicants who have been refused appointments because of their gender? Who are the potential applicants who wanted to apply but did not because the process was obstructive to women? My adult lifetime has been spent in the law and I have never met such a person. These numbers don't really tell us much.

There are all sorts of reasons why we have so few women judges. In order to gain an appointment it is usually necessary to have at least 20 years' experience and usually more, so what follows relates to those who qualified two decades and more ago. First, there are far fewer female lawyers than male lawyers. Secondly, the proportion falls as they reproduce and either leave practice for ever or take a long break to supervise the fruit of their loins and then return to work part-time. Thirdly, those who return to work full-time once the last speck of vomit has been mopped from the nursery floor miss several years of experience and feel that gap means they are not yet ready to apply. Fourthly, those who still have dependent children sometimes feel the relative lack of flexibility over working hours (and days) would be inconvenient. Fifthly, many are not the primary earner in the family and are not particularly career-minded. These points are relevant more to those who might be considered for positions as Circuit Judges and District Judges than to the high-flyers who would aim for the High Court bench but they are all derived from my own experience of the very many senior female lawyers of my acquaintance.

Before the Harriet Harman fan club pelts me with rotten tomatoes and chants "sexist pig, sexist pig, sexist pig pig pig" to the tune of the William Tell Overture, I must remind them of one thing. Female lawyers are a tough breed. They take their own decisions. That those decisions deprive simple Harriet of the statistics she wants is her problem not theirs. I know not whether the Times' legal editor is of the Harriet Harman school, but I do know that including bare statistics about the current numbers of female judges when discussing future judicial appointments is, at best, an irrelevance.

This whole exercise illustrates something about the bad word "diversity". In the wrong hands "diversity" means discrimination - discrimination of the worst type, discrimination based on pigmentation and gender. In the right hands it is a useful watchword against which to assess whether admission to certain positions is open to all regardless of pigmentation and gender. "The Lord Chief Justice is worried about the diversity of the Bench" is a classic formulation from the wrong side of the fence and does not match what Lord Judge said. He is definitely on the right side.

Double-dip dementia

2011-01-27T22:18:00.008Z

The world of modern politics is so dominated by form rather than substance that we can hardly be surprised when a piece of total nonsense becomes the benchmark for success or failure of a particular governmental policy. This week we have seen the threat of a return to recession dominating the feeble sparrings of the frontbenches in the House of Commons. The problem with this is that recession is treated as an unmitigated ill when it is anything but because, as always, it depends on what is actually happening.

I know this is old ground but it is worth examining again what a recession is. The conventional definition is that it is two consecutive quarters in which Gross Domestic Product (GDP) declines. So, what is GDP? It is in answering this question that we see why recession cannot always be considered a bad thing. GDP can be measured in various ways but they all amount to pretty much the same thing, GDP is the amount the UK spends on goods and services within the UK plus the amount spent on investment within the UK plus the value of exports minus the value of imports. The amount spent on goods and services comprises both the amount spent by consumers and the amount spent by government. GDP is not a measure of profitability nor of sustainability - it tells us nothing about whether the amount of spending that has occurred was affordable.

To see the limit of GDP as a measure of substance it is possible to isolate one household and see what effect it has on GDP. Mr & Mrs Ordinary have take-home pay of £500 a week. They spend £400 and put £100 in a biscuit tin under the bed. They contribute £400 a week to GDP from their own spending and thereby allow the recipients of their spending to have more to spend and this adds to GDP and the recipients of that spending also spend and so it goes on. After three months they decide the biscuit tin is sufficiently full and not to save any more. The next week they spend £500. GDP has gone up. After three months they change their minds and start saving again, but only £50 a week rather than £100; they still spend £450. GDP has fallen. The next quarter they have further concerns about spending too much and cut their spending back to what it was before so they spend £400 and start stuffing a second biscuit tin. GDP has fallen again. Oh woe, we are in recession. But what is the reality? A family that could afford to spend £400 and needed to save £100 in order to provide for its future started overspending, then they reduced their spending again in instalments to get themselves back on an even track. The reality is that the rise in GDP caused by spending more than they could afford was an illusion, it should never have happened and if it had not happened there would have been no wailing and gnashing of teeth. As it is, panic has set-in simply because spending that could not be afforded has been removed from the system. In fact there should be a sigh of relief rather than panic. At the start and end of the exercise they spend what they can afford, in between they overspend. The problem is not the return to affordability, the problem is the unaffordable splurge between the start and the end.

The position gets even more absurd if Mr & Mrs Ordinary borrow £100 a week while they are spending all their income so that they spend £600 a week on an income of £500 a week. GDP goes up even further and it falls even further when they come to their senses and decide to live within their means. In this situation there has been a GDP bubble - like every bubble it is full of nothing but air, there is no substance to it. Deflating the bubble reduced GDP and we should say "about bloody time too".

Similarly, because GDP includes government spending on goods and services, all unaffordable spending by government boosts GDP. In particular, spending borrowed money on goods and services boosts GDP. Spending money they have gleaned in tax will always be pretty much neutral in terms of GDP because if not taken in tax it is likely to have been spent by the taxpayers (of course some could be saved, but that which would be spent would undoubtedly be spent better than government spends it).

Government could borrow £10billion a year and spend it on two gangs of workers - one gang to dig holes in the morning and another to fill them in again in the afternoon. This pointless activitiy boosts GDP because it leads to more money sloshing around the economy but it is utterly pointless in any other respect. Were the exercise to end GDP would fall; again it should elicit a sigh of relief. As things are we don't yet have gangs digging and filling holes, but we have the modern politically-correct equivalent in an army of public sector naggers, snooper, counsellors, fake charities and form-fillers who are not necessary, provide little if any benefit and yet are retained and paid for from borrowed money. What does that additional GDP mean? It means no more than the additional GDP derived from Mr & Mrs Ordinary spending borrowed money, it is bubble GDP and tells us nothing about the state of the economy as a whole. Remove it over a couple of years and we could find ourselves in the longest and deepest recession in history, a situation that would bode extremely well for the future because the future would not include the wasteful and unnecessary expenditure that boosted GDP artificially.

"Artificially" really is at the heart of the matter. GDP is boosted by government borrowing to fund pointless activities that achieve nothing other than to boost GDP. If you look only at GDP you can be fooled into an illusion of perpetual motion. Borrowed money can increase GDP therefore we must borrow more and more. Nonsense. It omits the other side of the equation which is that borrowed money must be repaid and commands interest in the meantime. If you pay 5% on the borrowed money the benefit of spending the borrowed money must be more than 5% to make the exercise worthwhile. Even a benefit that can be measured as 5% of the borrowed money only allows you to stand still, it does not repay a penny of the capital sum borrowed. That there is an increase of GDP is irrelevant because it only looks at one side of the equation, it does not take into account the cost of borrowing the money. It fails to acknowledge the broken window fallacy.

We shouldn't fuss about whether GDP is up or down this quarter or the next, it really doesn't matter. What matters is that money is used wisely because the unwise use of money eventually results in retrenchment if not bankruptcy. A decade of it being used unwisely can thrust GDP into the stratosphere but that tells us nothing about the health of the economy. GDP was never higher than before the recent recession started yet the economy (to be more accurate the government's finances) was in a complete mess. That recession has not yet ended.

Of course it has ended according to the artificial measure called GDP and we might re-enter recession according to the artificial measure called GDP, but the reality is that we still have government overspending by about £160billion a year and we will be in recession until the resultant debt is eliminated. We will be in recession because ordinary people will continue doing what they are doing now, namely paying-down debt and putting aside some money for fear of unemployment, rising taxes and rising fuel bills. All they are doing is returning their own economies to a sound state. If GDP plunges but people are in charge of their finances rather than their finances being in charge of them the country will be in better shape.

A classic case of Northern Crock

2011-01-21T00:52:00.003Z

Someone I know has to sort out the estate of a friend of his who died last week, the poor fellow had cancer and was only 35. He has been making enquiries into his friend's assets and liabilities. Apart from a few hundred in the bank and normal household effects the only major asset is an ex-council flat originally bought some years ago under the right-to-buy legislation, the deceased bought it four years ago for £170,000 with the assistance of a loan from Northern Rock. It is a classic example of why Northern Rock is known as Northern Crock.

The deceased was a hairdresser earning around £30,000 a year gross in 2007. He had been renting all his adult life and wanted to buy his own home but had very limited savings, so he searched for a 100% mortgage. Northern Rock advanced not only the £170,000 needed to buy the flat but also a £10,000 unsecured loan. The mortgage was repayable over 20 years but no mechanism was put in place to repay any of the capital and the borrower was not required to take out any life assurance to provide Northern Rock with a lump-sum in the event of his death. All that is pretty sloppy, they lent £10,000 more than the property was worth, a sum equivalent to about six-time the borrower's gross income, to someone who would have no obvious means of repaying the capital at the end of the loan period. Their only security was the property itself, and that is where the whole thing becomes a true crock.

Because the flat had originally been bought from the council some years before, the lease had only 57 years to run. These days leaseholders have certain rights to extend the period of their lease but it costs money and only happens if the leaseholder gets round to asking for it. In the meantime the property is worth only what it can be sold for in the open market. Flats with less than 60 years left on the lease are not accepted as security by most mortgage lenders (Northern Rock was one of the few foolish enough to lend against such a property), although an extension can be obtained it must be paid for and when the lease is running short it can cost many tens of thousands of pounds plus conveyancing costs and valuation costs if the freeholder does not agree the figure - all these costs must be borne by the leaseholder. In the case I am discussing the lease now has only 53 years to run and I would estimate the cost of gaining an extension to be between £20,000 and £30,000 (I claim no expertise, but that is my best estimate). This affects the current value of the property enormously because it excludes the vast majority of the potential market from being able to buy the flat. Only cash buyers are in the market and they are unlikely to buy an ex-council flat for their own occupation; the real market is professional landlords looking to extend their portfolio. They will only buy through an estate agent if they can get a real bargain, otherwise their money will go further by buying at auction. The reality in such a situation is that the open market value is the forced-sale auction value. In this particular case the open market value of the property on a long lease of 90 years or more is around £190,000-£200,000. As it is, anything in excess of £120,000 would be a good price for the vendor, it wouldn't be at all surprising to find the flat sells for no more than £100,000.

His executor will sell his household possessions for a few hundred pounds to off-set funeral expenses and, if he is sensible, will simply surrender the flat to Northern Rock - there is no point him engaging estate agents to sell because he would have to pay their fees himself. Northern Rock will recover a flat worth at most £120,000 to cover a secured loan of £170,000 and an unsecured loan of £10,000. Their loss is likely to be at least £60,000 - no less than one third of the total amount they advanced.

One might think they could have protected themselves through insurance. I do not know whether any part of the loan was insured against default but the life of the borrower was not. Had they insured part of the loan itself (using what is usually called mortgage indemnity insurance) they might be able to recover 10 or 15% of the secured loan but their loss will still exceed £30,000.

Although this is just one example, it illustrates the folly of the sort of high loan-to-value mortgage loans for which Northern Rock was famed. No one knows how many similar bits of trash sit on their books.

Resigned or frustrated

2010-12-13T05:02:00.002Z

I find it hard to write anything these days. It's not that there is nothing to write about, just in the last couple of weeks we've had the EU bullying Ireland at the behest of Germany, a multi-million pound talking shop farce in Mexico, the first guilty plea from a former MP who defrauded the public purse, the strengthening of the food police and people rioting about nothing in London. Yet I haven't been stirred to action. I'm trying to work out why.

When the new government limped into office the mere fact that the risible Gordon Brown and his cohort of contemptible dictators had been ousted caused me to breath a huge sigh of relief. Whatever the new lot did could not possibly have made things worse for the country than the carnage wreaked by their predecessors - carnage of a structural kind which left our society split into bitter factional interests as well as carnage to the economy. They've gone. It cannot get worse. No need to rage about things. Both my regular readers will be aware that the policy programme of the new government is miles away from what I consider in the best interests of he people of this country but at least it is a yard or two closer than poor Gordon could ever have taken us.

That can explain a quiet period while we wait for the coalition's positions to be formed clearly but it cannot explain a lack of complaint once their positions were set so closely to those of the failed Labour government. Perhaps the explanation is dispair. Because so little is different now there is, perhaps, little point in repeating my observations of the last couple of years. With the exception of Eric Pickles I have detected no current Cabinet minister prepared to pop-up above the parapet and challenge the ever-expanding State. Michael Gove did so for a fleeting moment with his proposal for schools to be run free of political involvement, then ruined it by giving detailed guidance on curriculum and examination standards. There was even a tiny hint from Andrew Lansley at the Health Department with his idea of getting rid of layers of bureaucracy only for him then to retain within the remit of the NHS every aspect of nannying that had been added over the previous two decades. Only Mr Pickles has had the guts to say he's only a politician and doesn't know how to run things on the "front line". Faced with only one obvious supporter for my views on how "public services" should be run it's easy to give up commenting on matters at least until another election is in the offing.

Or it might be that I am still in shock that so many people voted for the Labour Party at the General Election in May. More than seven months have passed since then and all the while a thought has been gnawing at what is left of my brain. Could there be a third or so of the population of this country that was both pleased with what the Labour government had done and wanted more of the same? That a fifth of school leavers were either functionally illiterate or functionally innumerate, or both, was not of sufficient concern to them that they would vote against a governing party that had interfered in schools like no government before. That there was still structural unemployment in some areas of the country was not of sufficient concern for them to vote against a governing party that claimed to be concerned for the poor above all others. That the economy was on its knees, as at the end of every period of Labour government, was not of sufficient concern for them to vote against a governing party that directed and regulated all aspects of economic activity in more detail than even Stalin managed in the USSR. Could they really think the state of the country on the 6th of May was despite Labour having been in government for thirteen years and not because of it? Could they really believe the problem was too little State interference rather than too much? Just that thought is enough to drive anyone to distraction and to the conclusion that there is no point being sensible when so many are so utterly devoid of critical faculties.

Part of me has been hoping the coalition will find the courage to join Eric Pickles in saying that government must do less. As each week goes by I see fewer and fewer signs of this happening. They still seem to be stuck in the view that government is the answer to every ill, so much so that problems caused by too much government can only be addressed by more government. Against such a background it is hard to stir the enthusiasm to comment because it feels as though you are just running into a wall. Perhaps I am resigned to the massive State now being a permanent feature, perhaps I am frustrated that the difficulties caused by government are given insufficient recognition or perhaps I am just not prepared to repeat myself too many times. Who knows.

Having said that, a couple of topics have piqued my interest so I hope to be able to add to this year's miserable number of posts a few times before the turkey is carved.

Salt, happiness and Jocky Wilson

2010-12-07T03:37:00.005Z

The magnificent Mr Puddlecote has posted with his usual perspicacity on the latest scare from the health Nazis (here). The topic is salt. It is a topic that has heated my urine for many years so I'd like to chip in. Since I've been quiet for a while it seems sensible to add another current topic, the Happiness Index, although, being the cunning old boy I am, I include it because it is directly relevant to salt.

First things first. Forget any notion that science can tell us a single thing about the consequences on our health of the ingestion of a given amount of salt. There is no universal maximum or minimum daily amount, there is no way of measuring the amount which is either needed or excessive for any individual, there is no accurate way of measuring how much is being ingested, there is no accurate way of measuring how much is being expelled from the body and there is no way of measuring whether a physical condition that might be caused by excessive salt consumption has in fact been caused by that. All they can ever do it seek to evaluate average needs - no doubt this (if done properly) is a difficult exercise and takes considerable knowledge and skill, but once it's been done it is of absolutely no use to anyone because there is no way of measuring whether any given person is average, below average or above average in their need for salt or in their susceptibility to harm from salt.

For decades it has been peddled that excessive salt consumption can cause high blood pressure and other medical nasties. That might or might not be true, I am sure I once came across a blog dedicated to exposing salt scares that challenged the hypothesis but I can't find it now. Let's assume it is true. We have to be very careful about exactly what we are assuming. Because we all need different amounts of salt in our diet for our bodies to perform efficiently, only consumption above the level we require can be excessive. That is not necessarily the same amount of salt all year round because we sweat more in summer (or in the presence of Joanna Lumley) and will secrete more salt than in winter (or in the presence of Harriet Harman), to maintain a working balance we must take more in summer (Lumley) than in winter (Harman) - unless some other factor interferes to require us to take more in winter. Some claim that we simply pass excessive salt when we dispose of used beverages and they might be correct but that doesn't mean that regular consumption of more than we need cannot have adverse consequences because harm could, in principle, result from that excess quantity being in the body prior to joining gallons of second-hand beer on the floor of the gentlemen's facility at the Dog and Duck.

And then, merely physical need tells only part of the story of human life. The human body is a machine. It takes in fuel and gives out waste products, just like a motor car. The difference between the human body and the motor car is that it is far more than a machine. It has feelings, senses and emotions that are essential parts of life and not things to be left to one side while we deal with the machine only. Food and drink are part of the feelings, senses and emotions aspect of life just as much as they are fuel for the machine. If old Auntie Enid likes a whole shaker of salt on her roast potatoes and would have a miserable Sunday lunch without it, how are we to assess the salt content in her diet? Excessive - because her body didn't need that much to function - or just enough because it gave her a happy time when otherwise she would have felt excluded from the family jollity going on around her?

When thinking of this subject my mind often goes to Jocky Wilson's lager. No, I'm not joking, the point is absolutely serious. Jocky Wilson was one of the great darts players from the late 1970s until the early 1990s. In order to play well he needed to be relaxed and, for him, that required lager. Quite a lot of lager. Once he reached a certain level of intoxication he was almost unbeatable, he had the necessary level of relaxation and concentration to allow him to play as well as anyone in the world. It wasn't something that could be measured. Some days it might be just a few pints, on other days it was measured in gallons but however much was required on the day he strove to continue his consumption in order to keep the level just right. As alcohol was burnt off it had to be replaced and failure to replace it would cause him to be unable to continue playing so well. Other players could perform well without a drink or with less drink but that was irrelevant he wasn't them and he wasn't playing for them. He needed a lot of booze in order to ply his trade at the highest imaginable level - did he drink too much? It depends what you mean by "too much". In each tournament he played his consumption was too little, the right amount or too much, depending on how it affected his throwing arm on the day. In the context of his long-term health it could well have been too much but any less and he would not have been World Champion twice and revered as one of the finest exponents the game has ever known. He is now entirely out of the public eye and is reputed to be living in poor circumstances at least in part because of his fondness for the sight of an empty barrel. One could isolate the booze and say he shouldn't have drunk so much, but that would ignore his achievements which would have been unobtainable without a liver quiverring quantity of drink.

When I was at primary school lunch sometimes included mashed swede. I absolutely hated the taste and I hate it still but the addition of enough salt would allow me to shovel it down and avoid the wrath of the scary dinner lady. Was that "excess" salt (and believe me, it took a lot of salt to mask the taste) bad for me or was it good for me because it allowed my little body to enjoy the benefits of mashed swede? Was the benefit of not being harried by a harridan outweighed by the taking of more salt than was good for my young blood pressure? There's no way of knowing, it cannot be measured.

Mr Puddlecote points out that the great Delia recommends using salt in the preparation of a number of ingredients of a Sunday Lunch. She is, of course, absolutely correct. Vegetables other than legumes, particularly root vegetables, boiled in unsalted water do not develop their best flavour because the temperature is not high enough whereas salted water boils at a higher temperature and that little difference in boiling point makes all the difference to flavour. We are all happier to have flavoursome food than bland food. If the trace of salt in vegetables prepared in this way has adverse health conseqeuences, how are they to be compared to the additional pleasure given by eating a tasty dinner rather than a less tasty dinner? It goes without saying that it cannot be measured. Even the amount of salt in vegetables prepared in that way cannot be measured because some will absorb more than others.

Our Prime Minister believes it wise to spend taxpayers' money on surveys of happiness. It goes without saying that it will be a complete waste of every penny involved for two reasons. Surveys can never measure anything accurately because they only give a snap-shot of opinion on the day the questions are asked. Not only can opinion change the next day but the questions have to be vague to avoid 90% of respondents saying either "not applicable" or "don't know". Secondly, and more importantly, you cannot measure happiness by reference to factors over which politicians have any control.

In relation to salt-consumption scares, try these two questions. "Are you happy that old Auntie Enid enjoyed her day out from her care home, The Coffin Dodgers' Lodge?" Of course the answer is yes. "Are you happy that old Auntie Enid had three times her maximum total daily allowance of salt on her roast potatoes?" The answer might well be "it doesn't matter at her age" but underlying that answer will be acknowledgment of the scare; the full answer would be "yes but she'll probably die before it kicks-in." How does that rate on the happiness meter? Ten out of ten for the first answer and maybe seven for the second. The second question is completely irrelevant to anything other than government statistics. All that matters is the first question because old Auntie Enid only has one life and if that involved an ounce of salt to make a meal just as she likes it she will smile her gummy grin until her final gasp. And the second question need never be asked.

What matters is the quality of life. It is an ephermeral thing, different for everyone at any given time and different for everyone from one moment to the next. Is a longer life more desireable than a second helping of pudding or a good shake of salt on Sunday roasties? That's up to the individual to decide. Time might prove their decision to be right or wrong or it might provide no answer. One thing that is certain is that their happiness will be increased by letting them decide for themselves.

A thought on the Housing Benefit caps

2010-10-31T06:07:00.003Z

Sometimes I read a "news" report and wonder whether I'm missing something. It's not uncommon for those who drink vast amounts to suffer forgetfulness and, over time, to lose their analytical powers. Perhaps I have reached that stage, but I don't think I have. I'm talking about the proposal to cap housing benefit and, in particular, about an article peddled by the BBC (here).

For the benefit of anyone who has missed the story or who is reading from beyond these shores I'd better lay the background. One welfare benefit payable in the UK is called Housing Benefit, it provides funds specifically to cover the cost of mortgage interest payments or rent. The proposal under discussion is that the amount payable towards rent should be capped. The cap will have four stages. Those renting a one-bedroomed property will be allowed no more than £250 a week, with up to £290 a week payable for a two-bed house or flat, £340 for three and £400 for four bedrooms (or more, or so I presume). These figures equate to annual rent of £13,000, £15,080, £17,680 and £20,800 respectively.

I am not the first to observe that these are large sums of money. To have £13,000 in your pocket after tax you have to earn something in the region of £18,000. On the assumption that someone renting for £13,000 also wishes to eat, water and clothe themselves at an additional cost of £100 a week, their annual pre-tax earnings would have to be in the region of £24,000. That is not far from annual average earnings. The payment of £20,800 in rent requires pre-tax earnings of around £27,000 before a single morsel of muesli has crossed the tenant's lips.

Housing benefit is paid out of taxes received by the Treasury. It is necessarily and inevitably the case that many employed taxpayers earn less than these sums and could not possibly pay that much in rent. Their taxes will be used to pay for other people to occupy homes they could not afford. It's an easy and, I think, lazy argument to say that the proposed caps are justified merely because many of those paying taxes could not afford even those sums in rent. That rather misses the point.

Someone who has been earning more than enough to pay rent of £13,000 or £20,800 a year might lose their job and be reliant on benefits until he or she finds another position. There is nothing essentially objectionable about them receiving benefits to help them keep their home until they find new work. If that work does not allow the payment of such a high rent they will have to move anyway but if it does they will resume paying the rent. In such a situation Housing Benefit provides a stop-gap relief pending the establishment of a new situation which, I would have thought, is what benefits are intended to do. That others have never been in the position to rent a property at such values is really neither here nor there. In this context Housing Benefit is akin to an insurance payment and those who rented at these figures necessarily earned more and paid more tax than those on lower incomes. Although Housing Benefit could be seen to come partly from those on lower incomes the reality is that those who previously paid their rent out of taxed income and claim the benefit while they are between jobs have already paid for it.

There is, of course, another group - those who have not had, do not have and have no reasonable prospect of ever having enough earned income to pay their rent and are habitually dependent on Housing Benefit. For this group the question "why should people with modest taxed incomes who cannot afford such rents pay so much towards their rent?" is more pertinent. Indeed it is hard to see any justification for such people to be subsidised out of tax to live in expensive areas. Harsh though it might sound in the modern world of holistic touchy-feely wibble, beggars can't be choosers. Or to put it less harshly, if you live on hand-outs you can have no complaint about the payer saying "sorry, we can only hand-out so much".

The BBC article I linked to above (this one) asserts that the majority of two-bedroomed properties in London will be too expensive for Housing Benefit claimants if a cap of £290 a week is introduced. This is where I wonder whether I'm losing my faculties. Landlords want the best return they can get but they know they have to pitch the rents they demand according to the ability of likely tenants to pay. Pitch it too high and there are no takers. More importantly, landlords know that the worst thing possible is what is known as a "void period" - a time when the property is empty and no one is paying rent. Say the desired rent is £300 a week, that is £15,600 a year. Four weeks without a tenant reduces the annual rent received to £14,400. If you have a tenant paying £300 a week through Housing Benefit and are told the benefit payable will be reduced to £290 a week, what would you do? Throw out the existing tenants - possibly incurring legal costs and risking a void period - or reduce the rent to £290 a week? No doubt some would choose the first course but reducing the rent would still bring in £15,080 a year, a tiny reduction accompanied by the certainty of payment.

Say your two-bedroomed property commands a rent of £500 a week rather than £300. It would have to be in a very smart part of town for that to be a true market rent. On being told your existing tenant will only pay £290 because he is on Housing Benefit and that is the limit, the question you have to ask is whether you will find a replacement tenant who will pay substantially more. In areas where £500 a week is a true market rent the answer is almost certainly that you will find a new tenant. It's tough luck on the existing tenant but you cannot avoid the fact that such a property is at the high end of the market and it cannot be justifiable for taxpayers to keep someone else there when they cannot pay the going rate and others could.

And that really is the point I want to make today. The Housing Benefit rent caps will only result in existing tenants having to move if others are willing to occupy the same properties and pay a higher rent out of post-tax income. That situation will prevail in some instances. There is no denying that existing tenants who are required to move will find it upsetting. Regrettable though that is, the caps are at high figures and there is only so much taxpayers should be required to pay towards the housing costs of others.

Lurking behind all of this is a state of affairs that arises whenever government subsidises anything. If the subsidy does not have a limit people will milk it for all they can. How many two-bedroomed flats for which Housing Benefit currently pays £350 a week would actually command that figure in the open market? Landlords of benefit claimants pitch the rent at the highest figure they think will be paid in Housing Benefit. The same rent might not be achieved from renters paying from earned post-tax income. If they thought they could get more from non-benefit claimants they would do so, indeed they would be mad not to do so. In real life they know there is nothing to be gained from pitching benefit claimers' rent below open market rent so it can only be the same or higher. I'll give you one guess which is the more likely.

But there's more. The Chief Executive of the political lobbying group Shelter is reported to have claimed that "tens of thousands of households could be forced from the centre" of London. Shelter started as a genuine charity finding practical solutions for the homeless. The mere fact that it has a Chief Executive means it has outgrown its charitable functon and has become a business. It is in the business of justifying its own existence in order to keep its Chief Executive and such other salaried staff as it might have in their comfortable positions, which means its first function is now lobbying. So let's look at his proposition.

Tens of thousands of households could be forced from central London, he opines. OK, let's assume that happens. How, in the real world, can it happen? The properties they occupied will still exist and the landlords of those properties will still want to have tenants. Chucking out a tenant is only a good idea if you get a replacement. A tenant who pays minimal rent and trashes the furniture but still provides a small overall profit is better than no tenant at all. It is a necessary part of the Chief Executive's argument that tens of thousands of potential tenants are currently prevented from renting because benefit claimants are hogging the properties. On what possible basis can it be right that those tens of thousands should be excluded when they are able and willing to pay but cannot do so because taxpayers (including the prospective tenants) are keeping others in those properties? It is not a one sided coin. Existing tenants will only be ousted if currently frustrated potential tenants are waiting to take their place and pay, from their own post-tax resources, for the privilege. Why is he not lobbying for these excluded unfortunates to realise their dream?

Will "tens of thousands of households" be displaced? Of course not. But even if they were, tens of thousands of other households will take their place and pay for something they desire and can afford but presently cannot attain.

The Labour Party - what is it?

2010-10-31T01:12:00.003+01:00

I just went to the BBC's iPlayer thingy to watch Friday's episode of New Tricks. It wasn't listed separately so I clicked on "Drama and Soaps". One of the programmes listed was the Scottish Labour Party Conference.

Drama or soap?

LVT - a cart and horse inverse juxtaposition?

2010-10-14T22:14:00.005+01:00

Perhaps the greatest mystery about Land Value Tax is the absolute certainty with which those who support it voice the benefits that will accrue. Land prices will fall and then be kept stable, the cost to business of employing staff will be reduced thereby leading to greater employment, there will be no speculative expectation pressure on land prices, malaria will be no more and England will win the World Cup until the end of time, and so the list goes on.

In my last missive I asked how LVT will cause or contribute to a fall and then stabilisation of land prices and received some jolly interesting comments, none of which made a case I find in the least bit persuasive. A number of points made deserve a more detailed answer than comments allow, so I'll do my best to explain my continued puzzlement.

The first puzzle is: how does LVT cause prices to fall? One way this question can be addressed is by asking whether LVT would have prevented the house-price bubble engineered by Gordon Brown from about 2000 onwards. My first line of enquiry must be to ask what actually caused the bubble and then to ask whether LVT would have negated that cause. My view, which I have stated before at tedious length, is that the bubble is exclusively (or almost exclusively) the result of lenders advancing unaffordable loans, a state of affairs encouraged by the government despite the knock-on effect it had on the value of the lenders' assets. The entire state of tits-uppedness in which many banks and other lending institutions found themselves a couple of years ago (and still but they don't mention it now) was the result of making bad investments - specifically, making bad loans to prospective house purchasers. Although it is to state the bleeding obvious, if Mr & Mrs Ordinary suddenly find they can borrow £200,000 rather than £150,000 there is more money chasing the same goods and prices rise. Value doesn't rise, but prices do. We saw exactly the same thing happen in the mid and late 1980s (although it didn't cause a banking crisis because securitisation and credit default swaps did not get out of hand). How was the crisis solved in 1989? Simple, by letting the market adjust naturally. Borrowing became more expensive sbecause interest rates were set to a level that was appropriate to risk so that good loans paid for bad loans and, in consequence, prices fell dramatically. LVT didn't cause prices to fall because there was no LVT. What deflated the bubble was to withdraw the very hot air that inflated it in the first place. Would LVT have prevented "liar loans"? Will LVT remove that hot air from the current bubble? I don't see how it could or can unless it is set at such a high level that people can no longer afford to pay both their mortgage and their LVT.

And that is the core difficulty I have with the argument that LVT will cause prices to fall. Because LVT is recycled through the Citizen's Dividend it can only ever increase the cost of housing by less than the additional tax charged, because part is repaid to the taxpayers themselves through the Dividend. What level of LVT is sufficiently high to cause prices to fall below current levels? No one seems able to tell me. To my mind it is a false argument. To reduce a bubble you have to look at how the hot air got into the balloon and address that, seeking to deflate it by reference to something else entirely might work but it can only do so circuitously and will, inevitably, have other consequences that might or might not be beneficial.

It is then said that LVT will keep prices stable. How it will achieve this is the second puzzle. One argument is that it will remove the prospect of speculative profit and that this will mean people won't pay over-the-odds now in order to secure a windfall gain later, but this assumes the very stability it seeks to cause. In other words it is a consequence of stability and a factor that maintains stability but it cannot be a cause of stability, so how does LVT cause that stability in the first place?

There can only be one answer because only one factor can prevent price bubbles, namely the dampening of demand. That can happen in a number of ways. You can increase supply of housing to reduce the price pressure on each individual property, you can limit the amount potential purchasers can borrow or you can reduce the income of purchasers so that they can only afford to service a smaller loan. What is unavoidable is that LVT can affect only the third of these factors and it can only do so by being set at a rate which is more expensive to the landowner than the aggregate of the amount he saves through the abolition of taxes on his income and the amount he receives by way of Citizen's Dividend.

A marginal increase won't have any more effect than increases in other bills, a few quid or even a few hundred quid a year won't necessarily do it, people adjust because they save on matters they consider less important. For existing homeowners it will be an inconvenience like recent rises in prices for food, electricity and gas. They are not suggested by anyone to have had any significant effect on house prices, so why should a tax unless it really bites into their income? And it is not enough that it makes life more expensive for existing homeowners, it must be sufficiently expensive to deter potential purchasers from paying what they otherwise might be prepared to pay. So, how high would it have to be? I have no idea but it is, I think, reasonable to suggest that it would be so much that the whole thing would be politically impossible to implement.

Warning to those of a delicate disposition - the following paragraph appears to be nonsense from beginning to end and has been retained to remind me to read what I write before hitting the "publish post" button.
My puzzlement doesn't end there. The whole exercise assumes a transfer of money from landowners to non-landowners because of the Citizen's Dividend that stands alongside LVT to prevent the government making a windfall gain. The non-landowners receive a double benefit. They no longer pay Income Tax, National Insurance or VAT and they receive the Citizen's Dividend that increases as the take from LVT increases. One would think the natural result of them having so much more in their pockets and of their landlords being hit by LVT is that their rent would go up. Assuming that to be the case the acquisition of houses and flats to rent would appear to be an even more attractive business than it is now. There's no income tax to pay and your customers suddenly have many thousands of pounds a year more in their pockets, it sounds like a wonderful arrangement for landlords; all the more so because Capital Gains Tax is to be abolished too. They only need to raise rents by the difference between existing taxes and LVT and they are quids in, after all their tenants will be in profit by a lot more than that. And the effect on property prices? It hardly sounds like a downward pressure to me.

Much more puzzles me, but that's enough for today.

Some observations on LVT

2010-10-12T01:53:00.006+01:00

As a dedicated reader of the meanderings of my friend Gerard I have become familiar with some of his views on tax. In particular, I am aware that he believes it desireable to abolish Income Tax, Value Added Tax, National Insurance, Capital Gains Tax, Inheritance Tax and others and replace them with a Land Value Tax. His position is perhaps explained most clearly here.

The central principle seems to be that tax will be levied at so-many percent a year on the value of land (the value being assessed by reference to sale prices actually achieved in the area). Numerous alleged benefits of Land Value Tax (LVT) have been identified in the many posts Mr Wadsworth has made on the subject (collected here), including that LVT will contribute to the prevention of future land price bubbles and that it will not be as damaging to enterprise as the existing tax regime. I have long had reservations about both these claims, so I thought I'd say why.

Take LVT as a contributor to preventing price bubbles. The obvious first question to ask is how it will have this effect. And the obvious answer is that it will make it undesireable for prices to rise because any rise will cost landowners more in tax. To an extent it is hard to dispute this, but I cannot see how it goes very far.

Does it put any pressure on government to adopt policies that encourage stability or even a fall in land values? No, it does exactly the opposite. If land values fall so do LVT receipts and no government has ever seemed keen on reducing its tax revenues. Whereas a rise in land values will boost the Treasury coffers. On the face of it one would expect government to encourage a rise in land values.

Of course there is another side to this. A general rise in prices leads to a rise in LVT which everyone will have to pay either because they are landowners or because they rent from landowners who have to increase rents in order to cover their extra costs. When everyone is being screwed for more tax simply for the privilege of living in the same place they lived in for a lower cost last year, we can reasonably expect more than a few to cough a polite "ahem" and question the fairness of this windfall accruing to the Treasury. Perhaps the most obvious result will be the need for regular reductions in the percentage in order to keep the overall tax-take roughly the same; yet we can be confident that any such reduction will involve an element of drag so that more tax is taken year-by-year but not quite as much as it would be without a reduction in percentage.

Whether or not that is a correct inference to draw, how could LVT cause or contribute to a fall in land prices? The only way, it seems to me, is for LVT to be so expensive that it makes a significant difference to how much people are prepared to pay for any particular property. At the moment I think it reasonable to suggest that the main factor affecting how much people are prepared to spend on housing is the cost of servicing the loan they take out to buy somewhere. If they think ahead they would be well-advised to build-in a margin for the risk of interest rates rising in the future but in any event they will look at their finances and say "we can afford £20,000 a year", or whatever figure is appropriate to their circumstances. The wise ones will also take into account likely running costs including costs of insurance, repairs and utilities, so their thinking might actually be "we can afford £25,000 for housing, comprising £5,000 for running costs and £20,000 for paying for the place". The matter that determines how much they are prepred to pay is how much they can borrow in return for repayments of £20,000 a year. For sake of example, let's assume they can borrow £300,000. They do not approach the issue by saying "this house costs £300,000, how will we pay for it" but by saying "we can pay £300,000, what can we get for that sum?"

For LVT to have any appeciable effect on prices it must affect the amount people can afford to borrow. LVT can affect how much people can afford to borrow in one way only, and that is as a running cost that forms part of the overall household budget. Using the example I have just given, those with £25,000 to pay for housing would alter their analysis to something like: "we can afford £25,000 for housing, £5,000 will be needed for running costs, something for LVT and the balance to pay towards a loan". If the amount left to repay the loan is less than £20,000 that is fair enough, LVT could reduce prices. But, by definition, those very people are no longer paying Income Tax, NI or VAT, so their disposable income has increased. Say they paid £10,000 in IT & NI and £2,000 in VAT. Instead of starting with £25,000 to pay for housing they now have £37,000. So LVT would have to exceed the cost of the taxes it replaces (£12,000 in my example) for it to be able to make any difference at all.

The exact figures do not matter for this purpose. What does matter is that LVT will have to take more from household incomes than the taxes that are to be abolished for it to be able to have any effect on purchase prices at all. That is why I said it would have to be expensive. In order to have an appreciable effect it would have to be very expensive. In my example it would have to exceed £12,000 a year on a property costing £300,000. That is only 4%, so would 5% be enough, 7%, 10%? Whatever figure is chosen above 4% would provide the Treasury with a phenomenal windfall before any influence on prices fed through.

As to it not being as bad for enterprise as existing taxes, I am, again, unconvinced. The most stifling factor on enterprise is cost. Whether that cost is tax, wages, materials or fuel, the more expensive it is to start a new business or expand an existing business the less likely it is that the start or expansion will happen. VAT, Income Tax and National Insurance Contributions are the most stifling taxes because the first forces a business to make a profit just to break even and the other two increase the cost of hiring staff. Were all three abolished, enterprise would undoubtedly be rewarded ... or would it?

Abolishing Income Tax raises a particular problem because salaries are agreed gross not net. Someone on a headline salary of £30,000 is entitled to £30,000 from his employer whether or not part of that sum is paid to the Treasury as Income Tax. Get rid of Income Tax and employees' NI Contributions (which are also deducted from gross wages) and on the face of it, the employee would still be entitled to £30,000, there would be no saving to the employer. Employers' NI Contributions would be a saving, as would VAT. In their place would come LVT on the employer's premises. Who is to say whether this would be more or less than the saving in VAT and NI? I see no reason why substituting one tax on an employer for another should necessarily reduce his overall costs of doing business.

Maybe it will, maybe it won't, but unless the total tax take is reduced all that can ever happen is that the burden of tax is shifted onto someone else. Perhaps the victims will be landowners generally, both domestic and commercial, but it seems to me to be little more than guesswork (or perhaps nothing more than guesswork) to suggest that LVT will reduce business costs to any significant extent. It cannot be ignored that any sizeable increase in the cost of living of employees accompanied by a reduction in costs of employers will lead to calls for higher wages to return the balance to what it was before. And it is hard to resist the inference that employers would accede to those calls, at least in part, either voluntarily or after facing a revolt from the shop floor.

In this regard there is a difference between employees being hit by higher taxes from the government and employees being taxed more in order to make things cheaper for their bosses. In the former case the boss has an answer: "I've got no extra money, sorry" whereas in the latter it is necessarily the case that that excuse does not arise.

Once LVT has come into effect and the running costs of a household are increased accordingly it is unavoidable that some will not be able to increase their incomes and will find their homes unaffordable out of current income. The only answer given by LVT-ists is that such people will have to trade down to something they can afford, whether it be a cheaper rented place or a cheaper owned place. In itself that raises a serious policy issue. Is it right that taxation policy should force people to move from a home they could previously afford? This is illustrated most acutely by those on modest incomes who own a "high-value" property. The existing tax arrangements allow them to retain their home whereas LVT makes it unaffordable so they are forced to sell and move to something cheaper.

The usual justification given is that these people are not putting the land they occupy to efficient use and the benefit accruing from it being freed for more efficient use outweighs, as a matter of public good, the cost and inconvenience to the displaced individuals. I find this a most unattractive argument. In many parts of London and the South East the supposed justification cannot be assumed to be correct in fact. Even small properties command prices existing occupiers / owners could not afford were they buying a home today. Forcing out existing residents of one or two bedroomed flats and houses will not lead to the properties being used more efficiently, it will result in them being used by pretty much the same number of people but the new occupants will just happen to have higher disposable incomes than their predecessors.

Even where a couple moves out of their three-bedroomed home to something smaller in an area they might or might not know in order to allow one or two additional people to occupy their old house, the more efficient use of their former home hardly justifies the eviction. The occupation of land is not just an economic exercise; sentiment, including family history, are important aspects of life. People have a reasonable expectation, entirely separate from any windfall capital gain that will accrue on sale, that public policy will not render unaffordable the home they own. Of course they could remain in those homes and pay LVT out of capital by allowing their LVT liability to be charged against their home and redeemed when they sell or die. It is arguable that their homes are actually affordable on this basis because LVT simply sucks-up the equity they have acquired (but not earned) while house prices have soared. It is still a most unattractive policy to my mind because it then places these people in debt when they have arranged their affairs specifically to avoid debt. That the debt is to be paid out of a profit they have not earned is no answer except in an accountant's ledger. If you want to divest them of unearned profits wait until they are dead and apply Capital Gains Tax, don't worry them while they are alive.

What, I wonder, will be the position once LVT is in place and all those with homes they cannot afford have been forced to move to something they can afford. It is when we look at that position that we see the essential circularity of reasoning that underlies and undermines LVT. Where will people live? Answer: in homes they can afford. What is affordable? Answer: that which you can pay for out of income or by reducing your capital. What will be the most common form of affordability? Answer: paying out of income. No doubt some would choose to stay put and diminish capital for the privilege of remaining in the home they occupied since long before LVT moved the goal posts, I would suggest it is reasonable to infer that the vast majority will pay for their housing (including LVT) out of income. The inescapable conclusion is that LVT will be linked directly to income in the vast majority of cases. So, a tax brought in to prevent taxes being based on income (because that is potentially damaging to enterprise) will itself be based on income a few years down the line. And at every stage of the adjustment from current taxes to LVT the government will trim things so as to increase the total tax-take - I mean any government of any political hue.

A word about the Millibands

2010-09-30T03:13:00.006+01:00

Irrelevant.

There, that's a good word for them. Now I can address something almost as absurd as the Millibands (but perhaps not as absurd as the unions appointing Brother Ed to head their political party).

Apparently the BBC has commissioned a survey about how its programmes portray people of a homosexual disposition. My first reaction is "why"? Why should a broadcaster think it necessary to portray people of any sexual tastes in any particular way? The whole concept strikes me as bizarre. Allow me to let them into a secret. Homosexual people are just like heterosexual people except in their choice of bedroom partner. There are happy ones and sad ones, friendly ones and icy ones, sociable ones and loners, placid ones and violent ones, some can sing in tune while others can't, excellent sports players and hopelessly uncoordinated specimens, clever ones and thick ones, loud ones and quiet ones, law abiding ones and mass murderers. Find a human character trait and you will find homosexuals who have it. You see, sexuality is not character it is only one facet of character.

How does the BBC portray heterosexuals? That's easy to answer. It doesn't portray heterosexuals as such, it portrays people of widely different character who happen to be heterosexual. Their sexuality doesn't get a mention because no one cares (or even thinks about) it. No one would think of asking whether heterosexuals are portrayed positively or negatively in BBC dramas because they are not portrayed. People are portrayed. They are portrayed as kind or unkind, intelligent or stupid, fit or unfit; they are portrayed as each drama requires in order to tell the story.

There will always be a problem in dramas portraying minorities of any particular ilk because drama requires exaggeration. Happy couples must be that little bit more happy than they ever would be in real life otherwise they would appear ordinary rather than happy. Misery must be constant or it will risk losing impact with the audience. After all, real life is pretty drab and no one will be entertained by thirty or sixty minnutes of actors being drab. Drama has to catch the attention of the audience and that necessarily requires little foibles to be magnified and specific traits to be dominant features of the character.

It is said that the survey concluded that "lesbian, gay and bisexual people wanted to see more authentic depictions of their lives". What does that mean? More scenes of people doing the washing up, struggling to pair socks after doing the weekly laundry or waiting two minutes for someone to answer the door rather than four seconds? Strictly Come Dancing to be cancelled and replaced by Strictly Come Fisting?

Obviously one would have to know what questions were asked in order to know how that conclusion was formed but it seems to be inevitable that the expressed desire could never be met because of the need to exaggerate for dramatic effect. The conclusion, as expressed in the quote I have just given, suggests that the true conclusion is somewhat different. I would suggest that it would be more accurate to say "lesbian, gay and bisexual people don't like their sexuality being portrayed predominantly by camp and promiscuous stereotypes". That's fair enough and allows the BBC to save a lot of money by not employing hugely expensive artistes like Graham Norton and Dale Winton to mince all over the country's Saturday evenings. But it is nothing but a dream if it is really a desire to avoid exaggeration of a trait that is central to the character being portrayed.

Of course the biggest error the BBC makes is to assume that there is such a thing as a standard opinion held by homosexuals, still less that they can have a shared view of how persons of their sexuality should be portrayed on screen. I might be wrong because I don't have inside knowledge, but my guess is that the vast majority of them just want to be treated as people and will see exaggerated portrayals as necessary dramatic devices rather than insults.

The thing that tickled me most in the report of the survey was a quote attributed to the head of a pressure group called Stonewall which claims to have the right to speak on behalf of homosexuals. He is reported as saying this about BBC programmes: "it's right that everyone in modern Britain should be reflected in its output". How refreshing it is to hear the head of a special interest group insisting that those who condemn the activities of his group should be given airtime by the BBC. Religious fundamentalists who believe homosexual activity to be so wicked that it should be outlawed can now expect to be portrayed in a positive light by the BBC and, indeed, by Stonewall. No? Why not? It's what he said. And I would guess that the numbers holding those fundamentalist views aren't much different from the numbers of a homosexual inclination.

That's the problem with picking on a minority interest and treating it as something worthy of special treatment. Whether it is sexual proclivity, pigmentation, physical infirmity or any other of the selected minorities chosen for special treatment by the self-proclaimed "progressive" elite, it is impossible to make a principled stand for special treatment for one minority without extending the same privilege to others. Exclude others and you undermine the case for your own cause. There is an unassailable case for equal treatment but no case for special treatment

Incidentally, this exercise is a classic illustration of how tax-funded spending can be cut without necessarily affecting the delivery of "front-line services". If the BBC is fed less money it can stop wasting cash on commissioning idiotic surveys, it can abandon the backroom teams dedicated to ensuring "diversity" in its programme output and thereby save a packet. I wouldn't mind betting a packet (of pork scratchings) on it also having a department dedicated to reducing its "carbon footprint". That can go too. More on that another day.

Further apologies for absence

2010-09-09T01:11:00.002+01:00

It appears it wasn't a stroke, just an inability to use the old pins properly due to lack of oomph in the old ticker (apparently exacerbated by the most recent bout of cellulitis, which was itself in part the result of lack of cardiac oomph). Quite why that should also cause me to be unable to concentrate for long enough to write my usual drivel will remain a mystery until the trump of doom. But there it is.

Long brisk walks to get the pump working a little harder seem to have had an effect on what I laughably call my brain and next month's appointment with a quack and a balloon on a tube might improve things further.

Recovery is now sufficient to allow for a further piece of twaddle, which will appear shortly.

The graduate tax might be rather cunning

2010-08-10T21:00:00.006+01:00

There have been renewed mutterings over the last few days that an additional income tax might be levied on university graduates. It's all rather vague at the moment, presumably because it is a novel idea to introduce an income tax surcharge for one group of people so the government is letting out little hints in order to see what reaction they receive. Obviously the usual suspects are against it - trades unions, Labour politicians, quangocrats and university employees. The proposal could be to expand university places by fifty percent and these members of the awkward squad would condemn it for not being sixty percent, so we needn't take much notice of them ... unless they support their objections with sound reasoning.

As I understand the present system students are required to pay tuition fees each year and to provide for their living costs. Indeed I remember having a pupil about twelve to fifteen years ago who had gone through university and the Bar course under that system and left with debts approaching £40,000. It is the spectre of young people being saddled with hefty liabilities that invites examination of alternatives. Now, it shouldn't be thought that all students incur big debts, many go to their local university and live at home, many receive grants, scholarships or bursaries to help defray the costs; nonetheless with the student contribution to annual tuition fees currently set in excess of £3,000 (it's said to be a maximum, ha ha ha) that's still the best part of ten grand for a three year course.

The massive expansion of the university sector over the last fifteen years has provided the benefit of call centre workers having some specialist knowledge of media, fashion and football but it has also meant that the old system of grants for those without the means to pay became unaffordable. When the last government increased the tuition fee contribution they consistently justified their position by arguing that graduates earn more on average than non-graduates. That argument only goes so far because there are only so many jobs for which a university degree is actually necessary (or, at least, of significant advantage). Increasing the number of graduates does not increase the number of graduate jobs. It might allow someone to join a business one rung up the ladder but the difference in lifetime earnings for someone in manufacturing or retail cannot be calculated. I know graduates working in retail who did join a rung or two up the ladder but further promotion depended on experience so by the time they reached the third or fourth rung they were on a par with their non-graduate contemporaries. They had earned a little more for a few years while their colleagues had been earning for the three years they had incurred debts.

Essentially the same argument seems to be being put forward by the current government but in a slightly different way. The clearest hint given of current thinking was by David Willetts last weekend who is reported as having used the phrase "higher contribution to the benefits of the university education they have received". That is deliberately vague but it has been interpreted by some as the graduate tax expounded by Vince Cable a few weeks ago (reported here). Cable's proposal was quite wide-ranging and expressly kick-started a debate rather than being a fully formed policy. There is much to be said for it although it's not without its difficulties.

As with so many problems the current government has to address the first observation is that they really shouldn't have to start from here. This is just one more in the long list of utter failures concreted in place by Labour over the last decade to try to buy votes regardless of the longer-term consequences. However, we are where we are so the first question should be to ask what is wrong with the current system. I have identified the two main problems already - students leaving university with heavy debts and insufficient graduate jobs being available to provide the added earnings required to pay back those debts. These are both consequences of one thing and one thing alone - political interference. In this instance the same type of interference has caused both, namely the desire to buy votes by promising university education (almost) regardless of the suitability of individual students. It started when John Major turned the Polytechnics into Universities and has been a boast of every government since that young people have better educational opportunities than ever before. All that has really been achieved is the opportunity for many to get worthless pieces of paper when previously they would have had to earn a living for three years.

The ideal situation is that each University should be wholly independent and should sink or swim according to its ability to attract students. If the university is able to raise funds from graduates or businesses or elsewhere to provide bursaries it will have more students, apart from that it's pay-as-you-go. How many would offer courses in Football Studies or Feminist Sociology? I've no idea, if they can get the business that's fine if they can't they'll have to offer something useful.

This will require a massive culture-change, one that will take many years of small steps, weaning the universities off the tax teat and leaving them to "struggle" for students just like the University of Buckingham and BPP University College. I see the graduate tax as a step in the right direction albeit for a somewhat quirky reason. It seems to be the case that current students are not put-off university by the threat of debt, perhaps the lie of higher earnings has not been exposed sufficiently or they think they will be among the lucky few who will secure a true graduate job. It's rather different if there is a long-term tax consequence because liability will not (on the face of it) end when the cost of their tuition has been repaid. Perhaps there will be a long-stop but it is, after all, a tax and we all know they rarely go down, indeed once established the possibility for expanding them has been seized by every government in living memory.

Given the choice of having your fees paid by the taxpayer and then facing an unlimited tax or securing private funding, I know which I would find more attractive. Private funding might involve the need to reimburse part or all of the money but you can be as sure as the Stoke-on-Trent College of Art is now Staffordshire University that it will be cheaper than the new tax.

What is the quirk? Here's where I think Mr Cable and Mr Willetts are being rather clever. As the availability of non-tax bursaries for able students expands so incurring debt will be less attractive. It's not attractive now but lots are in the same boat. so they don't see themselves at a disadvantage compared to their peers. The fewer in that boat, the more they will be forced to examine whether incurring debt is right for them. I see this plan as a back-door way to reduce undergraduate numbers and weed-out pointless courses at third rate institutions, and to do so not by having students sign-up to it but by having them follow a different path. The taxpayer will not lose out because the universities will be funded by government only for those students who volunteer for the tax.

As I say it's one step in the right direction, albeit one that comes at a price for the students caught by it. Sufficient lead time will focus universities' attention on raising funds privately to entice quality students and should mean relatively few choose to commit economic suicide in order to get a fancy certificate signed by the Vice Chancellor, Professor M Mouse.

Still alive, just

2010-08-10T14:36:00.001+01:00

Apologies for absence. Same as last year, but the other leg.

True climate threat - Addendum

2010-07-28T04:02:00.002+01:00

In the comments to my last piece Mr Choos suggested that the Himalayas cause no problems to the climate so we shouldn't be concerned about buildings. I'm sorry to have to say this but he displays a desperate ignorance of the modern approach to science. Let me take you back to first principles.

In fact, let me start with an example drawn from different fields of study, zoology and modern anthropology. We all know that when lions need food they kill a nice antelope or zebra then tear off lumps of warm flesh and feast until sated. On occasions they might accidentally take a bit while their prey is still alive, but usually they ensure it is dead and the heart has stopped beating because they don't like to drink a lot of claret with their dinner. All aspects of the conduct of lions are to be applauded because they are natural beasts and do what Mother Nature intended they should do. We know she intended them to do it because they do it out of instinct, no television chefs or recipe books lead them from the path of natural righteousness.

Human beings on the other hand are subject to the wicked and unnatural forces of western commerce, a branch of what is mistakenly known as western "culture". Modern anthropology has established that the natural state for human beings is to live exclusively at ground level and eat only vegetative matter. You might have heard some "nature deniers" dispute this fact by reference to human canine teeth which, they claim, evidence a natural inclination to eat meat. Like so many of the denialist smokescreens applied in a vain attempt to deflect from the true path of modern climate science, this is a deliberate misinterpretation of basic facts in order to promote the interests of Big Oil. The true position is that human beings have canine teeth in order to allow them to make holes in babies earlobes prior to the insertion of raffia earrings as a sign of obeisance to Mother Nature and Her most bounteous crop.

We know that this is so because it was tested on computers. To be precise, in 1985 three Commodore 64s were used at the same time in different rooms at the Polytechnic of Mid Sussex and each produced an identical printout saying "yes" when asked "are human canine teeth designed for use in piercing babies' ears (glory be to Gaia)?" They had each been programmed by the Polytechnic's foremost expert in modern anthropology, Miss Camomile Tea, to provide the truth as disclosed in her seminal work Mother Nature's Labia. Of course we could just look the answer up in the book, canine appears in the index between camping and clitoris; but that would only provide partial proof. Those who wish to adopt old-fashioned methodology would assert that it is just Miss Tea's theory (although on this particular point her sister, Rich, helped with the basic analysis). To support her theory it was necessary that computers said the same thing, so she got some computers, set them up to test the hypothesis and they agreed with it. And there you have it, conclusive proof, computers have settled the science.

Having established this fundamental difference between human beings and lions it is necessary to identify the significance and what it tells us about human behaviour. On the one hand we have lions killing with aplomb in order to satisfy their natural instinct for food. On the other hand we have human beings murdering chickens, pigs, sheep, horses and cows in pursuit of an unnatural urge to consume the flesh of other creatures. The difference is that the former is natural and the latter is unnatural. They might seems like the same activities at heart - ending the life of another animal and eating it's flesh - but in fact they are completely different. One complements Gaia's great plan and the other does violence to it. One maintains the natural pattern of things, the other disturbs that pattern and necessarily causes other consequential damage in the process.

So it is also with the natural Himalayas and unnatural human-created buildings. When the Himalayas were developed Mother Nature took rock as only she can and turned it into a perfect form. In doing so she enhanced the balance of nature that, after all, is her job - she is incapable of doing anything else. It cannot be that the Himalayas interrupt the flow of air or cause Earth to rotate otherwise than perfectly because they are natural. The truth is that they steer air to where Mother Nature wants it and they stabilise the rotation of the planet. By definition, because they are natural they help create a perfect system. Human-caused protuberances above ground level, however, are a different kettle of ballgame. They are unnatural because they are the result of conscious decisions of human beings under the influence of Big Oil in comparison to the instinctive reactions of lions under the influence of Mother Nature.

The great Miss Tea has long since passed to the recycling centre in the sky but her book is still available. As far as I know there is now only one source (here).

The true climate threat from industrialisation

2010-07-26T01:52:00.005+01:00

Concern has occasionally been expressed in the comments to some of my scribblings about the ability of our planet to sustain many more human beings than are in existence today. Can enough food be grown? Where will they be housed? How will sufficient electricity be generated? Will we run out of plastic for all the additional roll-on deodorants? The questions never end. There is even a body supported by one of the Attenboroughs calling for huge reductions in world population and citing alarming guesses about the dire consequences of allowing lesser beings to have children. Although these modern day eugenicists overstate their case quite pathetically there is a smidgen of truth behind what they say.

Resources are finite and occasionally we run of stuff. At my local fish and chip shop it is usually fish at about ten o'clock on a Friday night. On a larger scale the world has run out of mammoth skins for coats, dodo eggs for omelettes and any number of reptile skins for shoes. So far ingenious humans have found alternatives and we have been able to sustain more and more people in more and more comfort as the years have passed. But it seems to me that along the way we have done far more damage to the earth than has yet been reported. No doubt it is just too frightening a prospect for the powers-that-be to allow it to be known. A recent paper has quantified the damage but it's very technical. Hours of work have resulted in my humble self being able to distill the gist of the problem. Please bear with me while I explain.

Calculations that are central to our understanding of the physical world make certain assumptions - sometimes broad and sometimes narrow. It is, for example, assumed that the planet orbits the sun once a year (or so), that it turns on its axis once a day (or so) and that there are small wobbles in its movement. These assumptions lie behind our calculations of time but, more importantly, they underpin all assessments of how our climate will change.

The problem, recently explained at length in the paper I mentioned, is that human beings have affected each of these assumptions. They have done so by disturbing the weight-balance of Earth and by interrupting natural air flows so as to change both the rate of rotation of the planet and many other things beside. One thing and one thing only that has done this damage - building.

As weight is transferred from on or under the planet's surface in the form of clay, rock, stone, slaked lime, slate and pozzolans into above-ground structures in the form of buildings, the natural balance between that which is at or below ground-level and that which is above ground level is altered.

Artificial height blocks the air that would otherwise flow freely above the ground, pushes it higher and causes it to increase its speed in order to reach its destination at the originally planned time. The buildings themselves act as buffers, slowing the rotation of the planet just as a parachute fired from the back of a fighter jet slows its progress after landing.

In addition removing natural products from the surface thins the crust of the planet and creates man-made hollows that attract water not intended for that place. As time progresses these artificial lakes will erode the surface further because a hollow created anthropogenically is a very different thing from a natural crater. Being a forced tear in the surface of the planet it cannot heal as a natural crater heals and will not retain water because it will not have the natural seal that forms on the surface, of nature's craters. Instead the surface will be weak and flaky and will be eroded quickly by water that settles in it, especially if that water is agitated by human activity such as boating, fishing and ducks-and-drakes.

If that is not already enough, the news gets worse. Where these materials, ripped from the very womb of Gaia, are piled high into monstrous icons to the wickedness that is industrialisation they add weight to the surface, weight for which it was never designed. Albeit it very slowly, ground level at the edges of our largest cities is rising as the weight of the city presses down; but that is a minor problem. Of far greater concern is the effect it has on the balance of Earth's rotation.

It is not by coincidence that we measure rotation by examining what happens to the Greenwich Meridian. When such matters were first thought about it was clear to all that London led the way. Just as a dancer executes a spin by moving the lead shoulder first (the right shoulder for an anti-clockwise spin and the left if turning clockwise) so our planet spins by moving London first. The more weight we add to London, the more difficult it is for the turn to start and the more difficult it is for it to stop at the expected time. Even a minor delay or overshoot can upset the balance of the climate throughout the planet.

Unless we spread weight more evenly and, in particular, reduce the weight of London, we can expect ever more floods, hurricanes, droughts and pestilence because the natural balance will remain disturbed and Mother Nature will take her revenge.

This might seem somewhat far-fetched to those who have not studied the source materials in detail. But if you think this is silly, you should read what people say about carbon dioxide. I urge you to read the detailed paper to which I refer, I think you will be persuaded, you will find it here.

What's wrong with prostitution?

2010-07-25T01:53:00.002+01:00

I've met a lot of prostitutes in my time. The first encounter was as a student looking around Leicester Square. It was one of those places I'd seen on the Monopoly board, so I thought I should take a look. I couldn't see what all the fuss was about, a shabby square full of tramps and litter with a big cinema at one side and nothing else of note. As I wandered back towards the tube station, safe in the knowledge I never need go there again, a woman aged about thirty walked towards me, stopped and said "Hello, nice to see you again, how are you?" Unlike today, at the tender age of twenty my brain was not addled by decades of booze. I was able to discern that I'd never seen her before in my life. I was also able to discern a bra strap hanging from the corner of the bag she was carrying. She must have been pretty desperate to think a fat slovenly twenty year-old would have enough cash to make the exercise worthwhile, but there it is, each to their own.

A few years later my encounters were almost daily as I plied my trade in the Magistrates' Courts of central London learning the rudiments of advocacy. As I waited for my tiny case to be called I would witness the old Toms being dragged up from the cells to face the Stipendiary Magistrate they had faced so many times before. The charge of soliciting as a common prostitute would be read out and met by a guilty plea, all the prosecution advocate had to say was "last appearance three days ago, £30 fine" or "three days in a row, £50 fine yesterday".

Stipendiary Magistrates still exist although they are now called "District Judge (Magistrates' Courts)" - actually the apostrophe might be omitted, but it should be there so I'll keep it. It was so much better when they were "Stipes", there's no handy abbreviation for their new title.

They know about prostitution. They know there are women working the streets who will always do it because they can't find anything better. They are at the bottom end of the trade and the fines are a business overhead. Some of them are funding cripplingly expensive drug habits but far more are funding children. It's their job. The Stipes know it's their job and they know they will go out again to earn the money to pay the fine, so they are realistic. For so long as soliciting is a crime they have to enforce the law but they try to do it realistically. London's cheapest and mankiest tarts might charge £20 for a sight of their boobs and a few moments in which their calloused hand is in contact with the punters excited member, then a wipe with a Kleenex and they're off looking for another customer. Five such deals will be required to pay today's standard fine and some nights won't earn them even that.

There's a better class of business to be seen in so-called "massage parlours". The girls have to look appealing or they won't be selected - unlike the street girls who encounter the punters with very little cash those who own the parlours know their customers will have rather more to spare so they must be offered a better quality of product.

More lucrative still are private arrangements which have been made much easier since the advent of the interwebnet. It is more risky for the girls than the massage parlours because they won't even see the punter until he turns up or she gets to his front door. But the money is better so they can turn way from a deal that doesn't feel right and still earn a living. And, of course, there is a top end as in any service industry, expensive girls for rich clients.

The street girls are arrested frequently and given small fines that reflect their circumstances. The massage parlour girls are in trouble only when the place is raided. It happens, but not often. Private arrangements hardly ever trouble the courts unless the girl steals something or the punter gets violent, and even then the matter is only reported if the punter doesn't mind people knowing he uses prostitutes or the girl doesn't fear loss of her future livelihood.

I raise this topic today because last night I went to my favourite Thai restaurant and found that two of the usual waiting staff were not present, one male one female. They are both students and had been working there for over a year. Being a polite sort of fellow I asked the manager about them and was told they had left in order to do other work. I asked him to pass on my good wishes if he heard from them again, but there was something in the way he said it that set my mind whirring.

Later I collared one of the supervisors and requested further details. He divulged that both were finding it difficult to make ends meet on what they earned from the restaurant so they had started advertising more intimate services on websites a few months ago. Both found it sufficiently lucrative that they could give up their old job. It wasn't surprising to hear that. A couple of years ago the Brazilian chap who made deliveries for the Chinese takeaway close to FatBigot Towers did the same thing. Once he was established it was a choice between six-midnight for £50 or one punter for a hour and £80 the tax man would never know about.

The cheap street girls and boys are often pitiful creatures. They scrape small fees from the lowliest punters because they can't attract a better class of custom. Most are simply unfit or unqualified for any better paid job, so it suits them to work as prostitutes whether or not they are on crack cocaine. The rest are doing very much the same thing albeit without the additional risks associated with working from the streets and having to sell to dubious customers.

Most importantly, each of them is providing a service for which there is a demand. They don't create the demand, they satisfy a demand that is already there. What's wrong with that? We usually think of prostitution involving men hiring women for sex, but women also hire men, men hire men and (I suppose, although I've never heard of it) women hire women. In each case there is a willing customer who is prepared to pay a certain fee for a certain service. He/she is prepared to pay that fee because they want the service.

Say it costs £100. A person has £100 available and is prepared to pay that sum for nookie. They are not prepared to pay it for a curry because it is not their curry money, it is their nookie money. It has been set aside to spend on satisfying a need that can only be met by someone offering nookie. The punter's desire for nookie is not going to subside if prostitution is outlawed. Nor is it going to be satisfied without payment - if it could be he/she wouldn't be throwing a ton at it. So, it's going to happen anyway either within or outside the law. In any situation like that prohibition is absurd. America saw it with booze and every country that outlaws prostitution and/or homosexual activity sees it also. It's going to happen anyway.

I then ask the question that is the title of this piece: "What's wrong with prostitution?" Today's Puritans - you know the sort, they bleat about smoking, drinking and eating meat - claim it's rape in disguise. If it is rape then it's rape and not prostitution, if it's not rape it's consensual conduct between two adults and none of anyone's business.

Others claim is contravenes their god's law. Fine, if your god doesn't like it don't do it, but do mind your own business because your god probably has something to say about those who interfere in things that are none of their business.

My money's on the girl from the restaurant making more money than the boy. He has sticky-out ears. Then again, you never know. What I do know is that I can't think of a single thing wrong with prostitution.

Schneider's "double ethical bind"

2010-07-20T05:50:00.005+01:00

Over at Mr Watts' place I read that someone called Stephen Schneider died last weekend. Professor Schneider's name was familiar to me as the man who promoted telling lies in order to get across the message of the Warmists. At least, that's what I had always understood him to have said. On hearing of his death it seemed appropriate to see whether he really had said it.

What he is often reported to have said is this: "... we need to get some broad based support, to capture the public imagination ... we have to offer up scary scenarios, make simplified, dramatic statements, and make little mention of any doubts we might have ... Each of us has to decide what the right balance is between being effective and being honest."

On the face of it this is a blatant call for overstating problems, understating doubts and engaging in dishonesty if that is necessary to get the message across. It was surprisingly easy to find out whether he really did say it, all I had to do was go to his own website. There is a section called "Mediarology" (here) in which he addresses this very point (under "The 'Double Ethical Bind' Pitfall" in the left-hand column). He makes clear that he felt the substance of what he was saying was turned on its head by the above words being isolated from a longer paragraph thereby giving them a meaning they did not have. I have read the whole paragraph and struggle to see any substance in his point. Here is the whole thing:

"On the one hand, as scientists we are ethically bound to the scientific method, in effect, promising to tell the truth, the whole truth, and nothing but - which means that we must include all doubts, the caveats, the ifs, ands and buts. On the other hand, we are not just scientists but human beings as well. And like most people we'd like to see the world a better place, which in this context translates into our working to reduce the risk of potentially disastrous climate change. To do that we need to get some broad based support, to capture the public's imagination. That, of course, means getting loads of media coverage. So we have to offer up scary scenarios, make simplified, dramatic statements, and make little mention of any doubts we might have. This 'double ethical bind' we frequently find ourselves in cannot be solved by any formula. Each of us has to decide what the right balance is between being effective and being honest. I hope that means being both."

Professor Scheider complained in particular about the omission of the final sentence in reports of his remarks and claimed that it qualified what went before. Specifically he argued that the final sentence changed the meaning of the more limited quotation I gave earlier.

One difficulty I have stems from his claim to be in a "double ethical bind". That supposes one strand of ethics pulls in one direction and another pulls in another direction on the same issue. While I can have no complaint about his description of the scientific method being a matter of ethics, stepping into the spotlight to further one's chosen political policy is not a matter of ethics. It is a matter of personal choice but it is not a matter of ethics.

One can test this by asking why the scientific method is a matter of ethics. Just so I make myself clear, my understanding of the scientific method is that scientific investigation should be accompanied by a freely available comprehensive record of what was done and what results came from that work. If a hypothesis is being tested, the hypothesis should be stated, the tests described and all results recorded whether they support or fail to support the hypothesis. If, on the other hand, the investigation has no hypothesis but is just an experiment to see what happens when various factors are combined, the record must state exactly what was done and what results were identified (again, all results). That is a matter of ethics because others might act in reliance on the conclusions of a scientific investigation, and they must have the opportunity to satisfy themselves that the investigation justifies them doing so. They must have the chance to replicate the work and see whether they reach the same conclusion.

It is not the fact that it is science that makes it a matter of ethics, it is the fact that it can affect other people. Medical practitioners are not obliged to maintain patient confidentiality for the sake of themselves, but for the sake of their patients. Similarly, lawyers are barred from competing against their clients or acting for clients with conflicting interests because the client(s) might suffer, not because the lawyers might either benefit or suffer. People working with money must keep their fingers out of the till because failure to do so is of detriment to their employers not because it is beneficial to them.

The second ethical question Professor Schneider raises is, by his own words, not one of ethics at all. It stems from his words: "we are not just scientists but human beings as well ... we'd like to see the world a better place, which in this context translates into working to reduce the risk of potentially disastrous climate change". This pre-supposes that he concluded there is a sufficient "risk of potentially disastrous climate change" that he should abandon the leafy groves of academe and (no doubt with huge reluctance) rake in fees from speaking and writing on the subject and dine with Presidents. It was most kind of him to make that sacrifice, but it was not a matter of ethics. Either his belief in impending Armageddon was based on science - in which case it was only as strong as the science and should always have been qualified by any doubts he had about the science, or it was based on something else. If it was based on something else there is only one possibility - his personal political values.

If it was based on the science there would be no ethical bind, his belief would be as strong as the science and he should always put it forward in that context. That doesn't mean answering every question with recitation of an academic paper and the provision of a sheet of footnotes, but it does mean explaining briefly the doubts and uncertainties where it is necessary to do so in order not to be misleading.

It is only when you go one stage further and decide to put forward a case that is more certain than the science allows that you enter the realm of allowing your views as a human being to conflict with the ethics of your work as a scientist. Or do the two really conflict? I don't believe they do provided one is honest. Where you are putting forward an argument that it not wholly supported by the science you have to make clear that you are offering your personal opinion rather than a scientific opinion. By all means also say you believe the science is incomplete, that you believe your conclusion is correct and the doubts and uncertainties are likely to be resolved in favour of the position you take; but that is all you can do unless you are prepared to act dishonestly. Argue a position not supported by science and there is no conflict with your position as a scientist because you are not acting as a scientist, you are acting as an advocate of a policy.

In fact there is a potential ethical problem, but it has nothing to do with the absurd notion that policy advocates are subject to some (as yet unspecified) ethical code. The problem arises where a scientist seeks to use his scientific qualifications and experience to give his policy argument authority that science does not give it. In the same way that a lawyer acts unethically if he uses his position as a lawyer to secure a personal advantage, so it is, arguably, unethical for a scientist to use his position to gain leverage for his personal choice of policy.

Professor Schneider's self-justification falls for this reason alone - he sets up a conflict of ethical codes when there is none. It reaches the realms of absurdity when he argues that he was quoted out of context by reason of the final sentence of his piece being omitted.

Having said it is for each scientist speaking on matters of policy to decide on a balance between being an effective advocate and being honest, the damage was already done. One cannot reach a balance between effectiveness and honesty without sacrificing honesty. If you cannot make your point effectively and still remain honest to the science, you should not be arguing the matter at all and should leave it to those (if any) who can. It's not difficult to do, there are plenty of people who argue policies without having any formal qualifications or recognised expertise in the subject, some even write blogs.

The suggestion that his weasel words: "I hope that means being both" changes the meaning of the previous sentence is ludicrous, it does the exact opposite, it reinforces it. By merely hoping for both effectiveness and honesty he acknowledged that honesty might be compromised. It should be of no concern to anyone that effective advocacy of policy is hindered by the advocate being honest, the only people concerned about honesty hindering effectiveness are those interested in promoting a policy that cannot be defended by honest assessment. That was clearly his concern otherwise he would not have set-up a dichotomy between the two and then argued for individual advocates to form their own view of how honest they had to be.

He did not say whether he believed effectiveness or honesty was more important but I think I can guess. The whole passage I have quoted has no point unless it is a call for effective advocacy in preference to honesty and, indeed, a call for effective advocacy of a position that is not supported by science. It seems to me that his attempt to worm his way out of the hole resulted in it being deeper and more shady than it was before.

Think before you do your bit

2010-07-12T23:53:00.003+01:00

We all like to do our bit in a good cause. The local primary school needs a new swimming pool, so people chip in a few quid here and there until the requisite amount has been found. As Remembrance Day looms lapels are adorned by little red poppies for which a little bit of loose change was dropped into a collecting tin. An earthquake demolishes the homes of little brown people, so we phone the number on the screen and use our flexible friend to add to the relief effort.

These might all seem like examples of doing our bit by pooling lots of small donations to produce a sufficient sum to help with a problem, probably because they are examples of exactly that, but they are each different things. In each there is an identified current problem which requires money and the solution is to have the little people reach into their pockets, but the difference is in both the scale of each activity and the extent to which the money given will be used for the stated purpose.

The school project is entirely local. It could be advertised further afield but is unlikely to reap much reward because few living in other towns and villages will feel any obligation to contribute. Unless old Iris the bookkeeper is having one of her creative moments, all the money raised will be used to provide a new pool, there will be no administrative costs.

Poppy day is organised by the Royal British Legion which is noted for having very low overheads because it relies substantially on voluntary assistance. It does have employees because it is such a large organisation that it could not operate effectively without some permanent staff. Necessarily this means that not all money donated goes to the care of ex-servicemen and women.

Providing food and shelter for trembling brown people is an international activity because the sums required are substantial and the organisations who get involved know they can tap into goodwill around the world. However, by their very nature, such organisations have large overheads. Some engage in widespread political lobbying and campaigning that eats into the value of donations they receive. And when it comes to delivering aid the results are variable, in part because of the need to pay bribes to national and local officials in order to be able to get any help through at all in some countries.

When we are doing our bit in these three examples, our bit delivers less bang per buck the further removed the beneficiary is from us physically and the larger and more corporate the body to whom we give our money. Yet in each case we give because we are satisfied that enough of our cash will get through to make a difference. Debatable though that might be in some specific instances of international disaster relief, failings are not widely advertised and the anguish of the next natural disaster always seems great enough to persuade many people to donate.

More than that, in each case it is absolutely true that whatever does get through makes a difference. The school might not raise enough for a pool in one year but it gets there eventually. Whatever is raised by the sale of poppies and the plea to help earthquake victims goes through the system and produces a result.

To my mind that is what "doing our bit" is all about. Our individual bit might be very small but it is pooled with other bits and even if the total remains modest it still achieves something because it causes something to happen.

Imagine what the reaction would be if the Royal British Legion promoted its Poppy appeal along the following lines: "Unless we raise £100million we cannot do anything. Once we raise £100million we can provide nursing care for one injured soldier for one day. Every further £1million will allow us to provide nursing care for one soldier for one day. We can only get to £100million if rich and poor alike give 20% of their income." Nobody would give a penny because the whole exercise would be futile. Giving £10 would not be "doing our bit" because it would achieve nothing other than making the donors poorer by £10.

True though it is that they will never get to £100million unless they start by raising £1 and then add to it, no good works will be possible unless everyone joins in and makes a substantial contribution and that will never happen because the cost of the of contribution required (on the hypothesis I gave) is out of all proportion to the benefit delivered.

I write, of course, not about the Poppy appeal (or indeed about swimming pools or quaking brown people) but about cutting emissions of carbon dioxide. On my last excursion I tried to explain why I consider it utterly futile for the UK to make any sacrifice at the bidding of the CO2 fetishists, but some were not persuaded. My resident Warmist, Mr Andrew, fought bravely and suggested that the little players such as the UK should do the decent thing and then seek to persuade (perhaps he meant shame) China and India into following suit.

It will never happen. The very reason they are industrialising is so that they can enjoy some of the physical comforts we have taken for granted for generations. We can only meet our absurd "emissions targets" by making those very comforts more expensive, thereby hitting the poorest members of our society hardest. To suggest that an industrialising country might slow or halt that process because we have made electricity and gas very expensive for our population and have chosen to get a small fraction of our electricity from windmills is pure fancy.

They can only reduce their emissions by reversing the process of industrialisation. Even the direst predictions of what might happen in China and India as a result of man-made global warming are insignificant compared to the benefits they will reap from industrialisation. They are not going to stop nationwide industrialisation because it might (on the worst-case prognostications of NASA's computer games) have a damaging effect on very small parts of their countries. Still less are they going to do so in order to prevent even more of the Netherlands being below sea level than is currently the case (particularly after the dirty Dutch performance in the World Cup final).

It's not like passing round a collection plate in the knowledge that some good will be done no matter how small the donations. The Warmists present an all-or-nothing case. Reduce CO2 emissions below a certain figure and the world is saved, fail to reduce them below that figure and the world is doomed. Anything short of the magic number is of no consequence. When reaching the magic number requires poor countries to remain poor despite them having set out on a path to riches it is obvious what chance there is of that happening.

None of this is about whether the Warmists' so-called science is accurate, nor does it question the validity of the absurd and Apocalyptic pronouncements about the consequences of not making Saint Al of Gore even richer than he is now. I am assuming for present purposes that all that nonsense can be accepted at face value. The proposed cure can never happen.

It is, I believe, obvious and unanswerable that nothing the UK does can make any difference. Nor can the USA and India between them make a difference for so long as China do not also play. China and India can achieve nothing without the US on board. The US and China can do nothing without India. And lurking in the background are Russia, Brazil, Mexico and a clutch of African countries who see what India in particular has achieved and, at long last, have realised they can do the same. None of them can be shamed into playing the de-industrialising game. There is not enough money to bribe them into playing. It simply cannot happen.

Somebody needs to point this out to our new Secretary of State for Energy Shortages and Climate Change Claptrap.

The reason I asked about carbon dioxide

2010-07-06T02:27:00.002+01:00

My last missive asked what effect a doubling of the UK's production of carbon dioxide would have. It wasn't a frivolous question, nor was it one to which I expected a precise answer. Nor, indeed, was it asked in the belief that human activity producing carbon dioxide is likely to have any appreciable effect on the climate.

It was asked in the hope that a passing Warmist might undertake a calculation using the same methods they use to estimate the effect on temperatures of world-wide industrial activity continuing uninterrupted by greenie initiatives. Only a fool would suggest they pin their colours to one calculation and one figure of anticipated "global" temperature rises, but they conclude there will be a significant increase according to every one of their methods of estimating these things. So, what is the range of figures for the effect the UK has now and the effect it would have if it doubled its output?

Of course none of the great and good would descend to the grubby depths of this blog, but some of their supporters have chipped in from time to time when I have ventured to question something about the Catastrophic Man-Made Global Warming theory (see, for example, the comments here and here). This time no one bothered at all. Maybe they have all given up with me, or perhaps they knew that any figure they might propose would be so pathetically small that it would illustrate the point I want to make.

It is at the heart of the whole exercise that things are measured globally save in the case of countries that produce absolutely bucket loads of CO2. They will be used to illustrate the evil of industrialisation to mother earth, whereas other countries (such as the UK) which produce tiny amounts compared to the whole will be lumped in with the sinners to produce stupendously high global figures for which all bear collective responsibility. This masks a truth that is spoken too rarely (unless you happen to be keen on some of my previous offerings such as this and this), namely that there is absolutely no point the UK taking any step to reduce its CO2 emissions unless all other countries do the same. And even then there is no point unless the big players do far more than us.

There's also no point bleating "but we must do our bit". We don't have a bit to do if the bit we do has no effect. After all, this is a game of cause and effect. If the effect predicted by the doom-mongers will occur regardless of anything done in the UK (which certainly seems to be the case for as long as China and India continue on the wicked path of lifting their people out of abject poverty by providing them with electricity for their homes and industries), we really shouldn't waste a penny on the exercise. Still less should we engage in self-flagellation.

A question about the effect of carbon dioxide

2010-07-04T04:37:00.002+01:00

I used to read lots of things about "global warming", now that "global warming" has been abandoned I read a lot about "climate change". Even a half-educated newt is aware that the "climate change" is the new term for what used to be called "catastrophic man-made global warming". I have had a lot of fun offering the occasional thought on the subject here and commenting about it elsewhere.

What I have never been able to do (because I have neither the inclination to seek the necessary knowledge nor the necessary knowledge to be able to interpret the necessary knowledge) is give figures that mean something. Figures like "if we add so-many giga-tons of carbon dioxide to the atmosphere over the next five years averaged temperatures - as measured by flawed instruments in only a few places - will rise by so-many hundredths of a degree Fahrenheit". I am not in a position to make that calculation / estimate / stab in the dark.

What I can do is read about (and suffer from) additional taxes being imposed on activities that produce carbon dioxide. I recently bought a new car. Out went the "executive saloon" and in came a small car because I no longer have to undertake long journeys for work - that the old car stopped working also came into the equation. The consequences included a reduction in annual road tax from £245 to £155 and a reduction in the cost of my resident's parking permit from £200 to £70. Both discrepancies arise directly from the carbon dioxide fetish. The reason given for taxing big cars more than small cars and for imposing higher charges for parking big cars rather than small cars was carbon dioxide. Nothing else. Some would suggest it is just an excuse to increase taxes but I would not be so cynical.

That is all very well if you believe carbon dioxide to be the deadliest gas since the days of Auschwitz and poor misunderstood Saddam's little Kurdish experiment. Let's assume you do believe that. Please answer me a question.

What would be the effect on the climate from the UK doubling its production of carbon dioxide? I don't ask for a fully-analysed track of all possible consequences, I ask for a real life answer that is comprehensible to Mr & Mrs Ordinary.

In principle there can only be three answers.

First, our additional CO2 would cause an increase in global temperatures. OK, if so, how much? As I recall, the UK produces around 1.6% of global man-made CO2, what I want to know is what effect a doubling of the quantity would have - so please tell me what effect the UK currrently has on temperature and how it would change.

Secondly, our additional CO2 would have no effect because the quantity we produce is so small that any change that might occur would be too small to be measurable and should, therefore, be treated as zero.

Thirdly, no one knows.

It's all very well saying "we're all in this together" and "we must all do our bit because many a mickle makes a muckle", that doesn't address my concern. I want to know what difference would result from the UK doubling it's CO2 emissions.

Unless someone can identify a consequence that is more than de minimis we really shouldn't worry about what we produce today. There is no point reducing something for the sake of the planet if doubling the same thing would make no substantive difference.

Does anyone know the answer to my question?

Mission accomplished, now let's play cricket

2010-06-28T00:06:00.003+01:00

It took a special combination of organisational incompetence and lack of will for our brave lads to manipulate themselves into a severe thrashing at the hands of the Hun.

I watched the first half and knew that the purple patch of flowing football played by England just before going in for a cup of tea and half an orange would be addressed by the German coaching staff. And so it was, according to the radio commentary I heard intermittently during the last 45 minutes.

What a contrast the two teams were. With one or two exceptions England had all the flair and experience but in this match as in the first three they were forced to play in a way that was not natural for most of the players. Germany, on the other hand, have a system and their players are selected for their ability to play to that system (a system which is itself devised with the main strengths of their best players in mind). If you want to produce a harmonious and fluent barbershop sound it's best not to pick Shirley Bassey, Englebert Humperdinck, Celine Dion and Tom Jones and tell each of them they are the star of the show.

Yes, Mr Lampard scored a perfectly good equaliser when the score was 2-1 in favour of Fritz and things might, just might, have been different had the referee and linesman's view not been impaired by brown envelopes stuffed with newly printed Euros. Nonetheless, the Krauts would have solidified their midfield and defence at half time just as they did with the score at 2-1.

Overall England's tournament was the shambles predicted here just two weeks ago. At least South Africa's reserve team is giving us a little pride on the cricket field.

Economic structure is more important than detail

2010-06-27T03:14:00.002+01:00

Now that some tentative first steps have been taken on the long path to reducing government spending to affordable levels it is worth asking whether the forecasts included in the Budget papers are as important as the shift of emphasis away from big government. I don't mean the "structural deficit" because that is just a way of describing part of the shortfall between spending and income. I mean the general ethos of reducing the influence of government in people's lives and, therefore, reducing the cost of government.

What is it that those who bail-out bankrupt governments require? One thing first - reduced government spending. Other conditions apply in most cases, but that is and always will be the first requirement. No individual, company, council, state or nation can stay solvent if it spends more than it can afford to repay. Our Keynesian friends babble on about the knock-on effects of reduced spending and argue that cuts now result in the loss of later gains that their spending choices would deliver.

How can the International Monetary Fund and the European Central Bank require spending to be cut hard and quickly if the effect of doing so is to make the borrower country less able to repay the loan? Yet they do impose that requirement whenever they lend to a western government. It is sheer madness according to the ex-Chancellor Mr Darling and now according to the current US President, Mr Obama, who has encouraged European governments to continue trying to stoke-up consumer demand. Both sides cannot be right. It cannot even sensibly be said that they are addressing different issues because the lenders need to be repaid over time and any step taken now that limits the chance of being repaid next year is not one they would be wise to encourage.

I wonder whether the key to understanding the apparent conflict lies not in economics but in politics. It is good politics to be able to boast of economic growth. We saw that first-hand in the UK as the housing price bubble delivered votes for the Labour government because it made people feel wealthier and allowed them to borrow and spend against their new-found wealth. For very obvious reasons the government claimed credit for that feel-good factor and, when the level of unaffordable debt was exposed, distanced itself from the other side of the bubble coin. So far the new government has not taken any steps to deflate the house price bubble because they know it could lose votes.

Interestingly, under John Major's government house prices fell hugely between 1989 and about 1991 and then flat-lined for a few years. During that period came the general election of 1992 and little evidence appeared that deflation of the house price bubble cost the government any substantial number of votes. I didn't hear anyone blaming the government for the nominal value of their house falling by more than half because they knew it had jumped artificially and very quickly in the previous few years. As an example, some friends of mine had their house valued at £375,000 in 1989 and at £150,000 in 1992, they had bought for about £120,000 in 1986. In a six-year period it had risen in value by 25%, an average of more than 4% a year which wasn't all that far away from general inflation. The huge spike was not real and people knew it was not real. The recent huge spike is not real and people know it is not real but the game has changed somewhat because far more people have borrowed against the bubble equity. Now bursting that bubble would raise fears that didn't arise to the same extent eighteen or so years ago.

Not only do people feel wealthier if they are told the "value" of their home has increased, they also feel the country is wealthier if GDP rises. There is no counterbalancing factor of the type evidenced by perceptions of the false spike of house prices in the late 1980s, yet the situation is the same. Why did GDP rise constantly through the 2000s? Of course numerous factors applied but one was the increased economic activity caused by borrowing money we could not afford to repay. Every time quarterly figures appear and inform us that GDP has risen by 2.7% is seems to be treated as setting a new lower benchmark for the acceptable level of economic activity in the country. We have achieved a level of activity and will suffer if that level of activity falls, or so goes the theory. It is as artificial as my friends' house going up in "value" from £120,000 to £375,000 because it has foundations of sand.

To Mr Obama and Mr Darling the maintenance of a falsely inflated GDP figure is an end in itself, presumably because of the possible political consequences of the figure falling. They cannot want to maintain that false and unaffordable level of GDP for reasons of economics because the price of continuing to spend more than you can afford is serious long-term penury. The lenders and the governments of European countries seem to take the view that it is time to stop pretending that unaffordable consumer debt should be replaced by unaffordable government debt simply to maintain a level of economic activity that is necessarily dependent on unaffordable debt.

It really doesn't matter if this approach leads to a fall-back into recession because the substance of the matter will be that the economy shrinks to the size we can afford rather than being kept at a size we cannot afford. At the moment the structure is wrong. Getting the structure right is the only way of ensuring both stability and affordability in the future. To my mind it is far more important than the technical detail of whether GDP is going up, down, in, out or shaking it all about. If our current government had the courage to include deflation of the housing bubble in its plan we could get there much quicker. It doesn't matter whether their predictions are accurate, what matters is that the balance of the economy - the structure - is sustainable. They could be billions out in their predictions of borrowing and spending levels a couple of years down the line, but that will not concern those on whom they rely to fund our broken economy while the costs of Gordon Brown's decade of incompetence are wrung out bit by bit.

While throwing these words together I noticed that the good Mr Economicus has written on the same subject in far more erudite terms, he is always worth a read (his marvelous piece on the illusion of GDP should be branded into the wallpaper at the Treasury).

Final humiliation postponed until Sunday - updated

2010-06-24T01:28:00.004+01:00

Our boys played rather well against Slovenia, apart from the first fifteen minutes and the last ten. Mr Milner on the right was highly effective, not least because the ball was kicked to him from time to time and Mr Gerrard stayed on the left (well, he is from Liverpool) rather than straying infield and getting in everyone's way. Mr Terry organised the defence extremely well but still holes opened and we only scraped a 1-0 victory. Still, it was enough to progress to the next round.

Germany. On Sunday. Oh well, there's another one in four years.

Update
Oh dear.

Should VAT rise?

2010-06-21T23:55:00.003+01:00

When government has been spending more than it has received it faces the obvious choice of spending less or increasing its revenue. There is much mumbling about tomorrow's budget containing an increase in the rate of VAT - perhaps by increasing the rate from 17.5% or by making VAT chargeable on items currently exempt such as food or by introducing variable rates to that some items are charged at a higher rate.

VAT is a curious tax because it operates in different ways in different situations.

Take a manufacturer of chairs. He buys raw materials costing £100 plus VAT. He is registered for VAT so he can reclaim the VAT he pays on those materials, they actually cost him £100. It costs him £70 to turn those materials into a chair. So it costs him £170 to make a chair. One might think he could sell the chair for £190 and make a profit of £20, but not so because he must charge VAT at 17.5%. If he sold at £190 that would comprise £161.70 plus VAT of £28.30 (£28.30 being 17.5% of £161.70). In order to cover his costs he must sell for at least £199.75. As the good Mr Wadsworth has pointed out, in this situation VAT is a cost to business rather than a sales tax.

On the other hand, take a lawyer. He charges £100 an hour plus VAT. His customer is billed £117.50 for every hour. A customer who is registered for VAT and incurs the charge in the course of his business can reclaim the VAT, so he actually pays £100 an hour. Mr Ordinary who wants advice about his neighbour's intrusive hedge (a quality my hedge no longer has) must pay £117.50 an hour and cannot reclaim the VAT. Different customers are paying different amounts for the same thing although the lawyer receives the same amount.

In practice work done for commercial clients often incurs a higher charging rate. One reason for this is that those who can claim back the VAT can be charged more yet still end up paying less than Mr Ordinary. For example, charging £115 an hour plus VAT costs the client £115 an hour because he gets the tax back. The real winner is the lawyer, a win he would not be able to secure if it weren't for VAT.

Then take the effect of VAT on those with fixed spending power. Mr Average has £100 a week to spend after council tax. He must buy food, electricity, gas, water, transport, clothes, furniture and appliances for his home and everything else he might want out of £100 a week. In his mind all potential expenditure is graded according to importance. If food goes up he might opt for cheaper baked beans but he must still eat, there is only so much he can do to reduce his food bill. So also with electricity gas and water, he might be able to reduce consumption but that can only be done to a certain extent. If the prices of these items go up because of additional VAT the suppliers might be able to absorb some of the additional cost (thereby reducing profit margins and tax receipts, as per the manufacturer of chairs) but they can only absorb so much. Mr Average will find his spending power eroded and it is inevitable that the items dropped from his list of desires will be items that are subject to VAT. The new telly waits until next year, the holiday at the Happy Camper Caravan Boutique is not taken, old trousers are mended not replaced.

There might be a slight increase in tax revenues (at the cost of Mr Average's standard of living falling) but only to the extent that he pays more in VAT out of his £100 than he would otherwise have done. It is not a one-way street, however, because he has to forgo things he would otherwise have bought and on which he would have paid VAT and on which the recipient of his cash would have paid tax. To take a simple illustration, say £70 out of his £100 was previously spent on VAT-able purchases (meaning, in effect, he spent £30 on non-VAT-able food). Out of that £70 of spending the VAT is £10.43, so he paid £10.43 in tax and £89.57 on goodies. Increase the range of foods on which VAT is charged and increase the rate so that £80 is spent on VAT-able items and the rate is 20% not 17.5% and he pays £13.33 in tax. He also has £13.33 less to spend. At the old VAT rate of 17.5% that sum of £13.33 would have generated £1.98 in VAT, so the revenue gains £2.90 (£13.33 - £10.43) but loses £1.98, a nett gain of 92p and it loses income or corporation taxes on the £13.33 he no longer spends at Mr Patel's Merry Mart.

Increasing VAT for Mr Average is hardly worthwhile and might actually lose tax revenue. Where an increase will be effective in raising revenue is in forcing people with some spare cash to divert some that would otherwise be saved in order to protect their standard of living. Mr Above-Average might have £120 a week to spend but be in the habit of saving £20. His spending habits are the same as Mr Average but, on the figures I have used above, he can afford to spend an extra £13.33 a week (or part thereof) to keep his standard of living roughly the same.

And then there is the black economy, that mysterious part of the turnover of builders, plumbers, electricians and the like who are always extremely busy but never disclose sufficient turnover to make them register for VAT. Saving £35 on a £200 job by using Dave Dodgy rather than Colin Clean turns into a saving of £40 if VAT rises to 20%, many a Colin might then find himself tempted to join Dave on the wrong side of the fence to retain business, thereby losing the Treasury all the VAT he previously generated.

As a generator of tax revenue VAT relies on chair manufacturers being able to sell their goods at a substantial profit, on consumers maintaining their spending and eating into reserves (or borrowing) and on businesses not keeping money off the books. The higher the VAT rate, the greater the price of a chair must be to break even, the more consumers must eat into reserves (or borrow) and the greater the temptation for businesses to hide their turnover (there are legitimate ways of doing this). It might result in a boost of revenue but the price is a high one because of the consequences to the Treasury and to the economy as a whole of these three factors.

Second humiliation achieved with room to spare

2010-06-18T22:56:00.003+01:00

Algeria. Yes, Algeria. Our multi-millionaire nancy boys scrambled to a nil-nil draw against Algeria. There is only one thing you need to know about the Algerian national team. Any Algerian players with the talent to play football at the highest level play for France like Zingazang Zebedee, or whatever his name was. The remainder form a team on a par with Outer Mongolia, Nepal and Scotland. And we could only manage a nil-nil draw.

Looking on as an outsider to the finer points of the game of international ball-kicking it seemed obvious what went wrong. Both the manager and Mr Beckham, hired to act as an inspiration for the lads, wore poorly cut single breasted light grey suits. Neither leadership nor inspiration can come from anyone dressed like a deputy librarian.

On the right we had Mr Johnson and Mr Lennon, both fleet-footed players who should trouble any defence. For most of the game Mr Johnson did most of the attacking along the right wing, it would have been easy for Mr Lennon to have done some too if only he had been passed the ball. Nothing either of them did caused any trouble to the Algerian defenders and I know why. Tattoos. Both are heavily tattooed and were worried that too much sweating might make the ink run.

On the left we had Mr Cole in defence, who did well, while the attacking was in the hands of ... I'll have a think and see if any example comes to mind.

Except for a five minute spell shortly before half time there was no sign of anyone wanting to take control of midfield. During that exceptional period there were short passes galore to by-pass and befuddle the mediocre opposition, but then nothing.

Curiously Mr Rooney, the fast footed but slow brained thug on whom so many of our slender hopes are pinned, seemed determined not to get his kit dirty. It was very kind of him to keep the national laundry bill down but he should be told that we would prefer him to make at least a little effort every few minutes.

Overall it was a shapeless, disorganised and thoroughly incompetent performance agaist spirited but limited opponents. A true World Cup humiliation.

Two down, one to go.

Hedging my bets

2010-06-17T01:16:00.002+01:00

Hedges are the finest protection against traffic noise yet devised, a two foot depth of dense leaves allows little sound to permeate, it also provides privacy from passing prying noses. Unfortunately they need quite a lot of work to keep them in good order. The time has come for the hedge at FatBigot Towers to undergo its five-yearly thinning.

It's all about leaves, you see. Leaves grow on relatively young wood. Once a stem has been in place for four or more years it tends not to produce leaves - that task is passed on to the fresher wood higher up the plant because that wood is more exposed to the sun and one of the main purposes of leaves is photosynthesis. There is little point wasting your energy sprouting leaves at the base when far more productive growth can take place further up. Also, the taller the plant the more shade it casts on itself, thereby making basal leaves even less effective. That is why old hedges often develop gaps at the base. The precise way your hedge will behave depends on its position and the type of plant it is, box grows differently from privet which is different from laurel or yew. Most hedges in London are privet, as is that at my modest hovel.

To keep a decent thickness of foliage towards the bottom of the plant you have to take out old stems that no longer deliver the goods. New shoots will emerge from the stump and, being new growth, will grow leaves as soon as they can - namely, while they are still quite short - thereby filling the gap.

One of the perverse pleasures of thinning a hedge is that the whole thing looks a complete mess if you've done it properly. Where there were thick stems and no leaves there are now no thick stems, so the gap is larger than it was before. And while you're doing the job you might as well give the whole thing a big trim back both in height and depth because they have the habit of expanding gradually year by year. This removes green leaves and exposes brown twigs, so you end up with an oblongy shape of apparently dead brush and a series of big holes at the base. On completion of the task I stand back and admire my handiwork, only to receive looks of dismay and disgust from all non-horticultural types who happen to be passing by. But I get the last laugh because a few handfuls of bonemeal and a good watering (for the hedge, not me) should result in the whole thing turning into a dense mass of bright green deliciousness within just a few weeks.

This task was last undertaken five years ago. It took all weekend and on the Monday I was in an ambulance on my way to the coronary care unit. Causation or coincidence? Over the next few days I hope to find out.

You'd have to be ill to risk this illness

2010-06-14T03:38:00.002+01:00

I have just read an item on the BBC news website. It reports American research as showing that showerheads are breeding grounds for bacteria. No one should be surprised at that, I am sure I've read it before and it's obvious anyway. When you turn off the shower some water remains lodged in the showerhead and sits there until the next time it is used. All sorts of little buglets can make themselves cosy in the once warm water and breed as only buglets do. In a few hours there might be millions of the blighters. What terribly dangerous things showers are. Until you turn them on, at which point the little buggers get flushed out. Some, no doubt, will remain and expose you to a risk lower than you take by washing yesterday's dinner plates by hand.

The line that particularly caught my attention said "If you are getting a face full of water when you first turn your shower on, that means you are probably getting a particularly high load of Mycobacterium avium, which may not be too healthy". OK, we'll allow him "may" when he meant "might". There is clearly no need for panic, to add to the lack of need for this sort of pointless research. Getting a particularly high load of something with a long name is only potentially "not too ... healthy", so there's not much to worry about.

Ah, but there is something to worry about and it is nothing to do with long words to describe very small things. You can only get "a face full of water when you first turn your shower on" if you are a complete moron. You might like a cold shower, you might like it hot, or you might like it somewhere in between, but you cannot know the temperature of the water until it is running and has established its par temperature. Even the best thermostatically controlled showers do not deliver water instantly at the temperature chosen by the fastidious user. You have to wait for it to run a while mixing hot and cold so that your desires can be met. Only a fool would stand under a shower, turn it on and hope for the best.

I have a vague recollection from a couple of years ago of people suing hotels because they were either scalded of frozen by the water from the shower. Obviously morons do exist and use hotel showers despite not knowing the temperature setting of the device. Even in the home someone might have changed the thermostatic control without you noticing or, if you have a basic mixer tap the hot might be hotter or less hot than it was yesterday so you have to test it with a hand or some other part of your anatomy that is more able to withstand variations than your most tender regions.

This is all so obvious that to stand under a shower and turn it on can be the practice of only the seriously mentally ill. Anyone unable to cope with such a simple exercise without putting themselves in peril of burns or chilblains will hardly worry about also getting a high dose of bacteria. And if you don't clean the showerhead you also deserve everything you get.

What a load of twaddle.

One humiliation accomplished, two to go

2010-06-13T08:36:00.004+01:00

We played America. Not at baseball or basketball but at what they like to call "sacker". Some say America is a force to be reckoned with in the game of ball-kicking, after all four of the team have played in the English Premier League and most of the others have experience of playing (usually in the reserves and lower leagues) in Europe.

Our boys all play in the Premier League. We have defenders who know how to defend against good players, the American team has defenders who struggle to get a game for their clubs when the forwards who would oppose them are no great shakes. We have midfielders who control matches against the best sides in the world, they have two chaps of no interest to any big club in the world. We have strikers who score goals from impossible positions, they have a man with the first name Landon.

We scored early on, a very good goal. Perhaps it was the worst possible start because it encouraged the overpaid nancy boys to think it would be a stroll in the park. Mr Rooney, a player of even smaller brain than his star predecessor Mr Gascoine, couldn't understand why the lesser beings of the American opposition were not moving out of the way to let him through and stopped trying. Mr Lampard, a fine player and one of the few articulate chaps in the squad never got going - as is so often the case when he plays alongside his footballing clone Mr Gerrard. No one seemed to know what to do and the team simply did not play as a team.

The goalie will get the blame because of his Sprake-esque error. In truth it shouldn't have mattered had he let in three flukey goals because England should have scored enough to ensure a comfortable victory.

I have had a feeling of doom about this World Cup campaign for several months. Of course you never know what will happen next because many a side has performed badly in its first match only to improve enormously with each further contest. Somehow I can't see it this time. There is no sign of a core strategy, a style of play that reflects both the combined talents of the players and the style of play that has made them successful in domestic football.

Alf Ramsey had a strategy designed to bring the best from the squad. It was a reflective strategy based on the qualities the players showed every week for their clubs rather than being an idealistic plan with which the players were forced to comply. He adopted that strategy by observing how most of his available players played best and selected his squad with that strategy in mind, leaving out some very good players because they were too individualistic whereas those he selected played best when adopting the same team format. Bobby Robson did the same, albeit with the exception of picking Mr Gascoine and forcing him to comply to the pattern that was natural to the rest of the squad.

Against America England did not play as a team. There was no sign that they were playing to a collective plan nor that they were playing together in a way that felt natural for them. To draw 1-1 against a side with one of the weakest central defensive formations in the tournament is nothing less than abject failure. Next we face Algeria. I will be in the curry house, which has installed a telly at the back of the restaurant. We might scrape a win, my guess is another 1-1 draw with Rooney getting a yellow card by kicking a small Arab in retaliation for a gibe about his ears. The final match might result in a slender victory against Slovenia but the USA will beat both those teams and score more goals than us; so Slovenia v Algeria will decide the fate of our brave lads.

Oh well, there will be another one in four year's time.

The problem with new graduates

2010-06-11T00:57:00.002+01:00

By coincidence, the subject raised in Mr Stan's latest missive cropped up in conversation today when I chewed the fat with a couple of old friends. Mr Stan pointed out the futility of pushing up to fifty percent (by number, not amputation) of young people into university and saddling them with huge debts to pay for course fees and maintenance costs and he proposed a way out. The friends I was talking to included a chap in his forties whose son has just finished a degree in International Studies, or something like.

I recall talking to the boy about it before he went to an obscure midlands Polytechnic that used to specialise in engineering draughtsmanship until it pretended to be a university and started creaming in fees for courses in waffly nonsense. It doesn't offer courses in engineering draughtsmanship any more, that would be far too useful. He explained that the course concentrated on the study of international organisations like the UN and its many sub-constructs. It seemed to me to be just the sort of thing you should pay for if you want to waste three years of your life. But I digress.

The boy's father said his son was about to graduate and had been looking for work. The positions he seemed likely to be able to fill were just the sorts of jobs he could have obtained three years ago as a school-leaver with A-levels. Of course he is not an 18 year-old with A-levels he is a 21 year-old with a degree, yet his starting rung on the ladder of work appears to be what it was three years ago.

This doesn't surprise me because the "old-fashioned" demarcation between "graduate jobs" and "non-graduate jobs" was based on substance not pieces of paper. Some jobs required young people whose brains had been extended by true academic study so that they had something extra to offer by reason of their advanced education. That is not to say that others could not move into those positions by proving themselves to have the wherewithal despite not having had the formal academic training, but the job required an extended mind so graduates were the first port of call for the employer. It presupposed that a university degree in certain subjects would equip the graduate with the necessary skills. Employers learned over time which universities and courses produced people best suited for junior positions in their businesses. I do not ignore that any degree course will provide a graduate with knowledge he or she would not otherwise have but acquiring knowledge is different from brain-training.

I suppose it is inevitable that having more people going to university will not change job prospects very much. After all the presence of more graduates cannot create new "graduate jobs". The same jobs are available whether the applicants have been to university or not because businesses need what they need and those needs do not change when more applicants have more certificates.

Two rather unfortunate consequences flow from this. One is that graduates, like my friend's son, find they are no better placed than they were when they left school; indeed they are in a worse position because they now have heavy debts to pay off. The other is that many first degrees are not valued by employers any greater than they value A-levels, so youngsters with first degrees in nonsense from the new wave of quasi-universities are under pressure to commit more money and more time to obtaining a Master's degree in the hope that it will provide an edge when the time for work comes. That is the course my friend's son is minded to follow because his first degree appears to give him no advantage over a school-leaver.

The other friend involved in the conversation has a granddaughter who has been offered a job provided she completes a Master's degree. Ten years ago that job would have required only a 2:2 Bachelor's degree but now everyone seems to receive a 2:1 or First so the prospective employer has upped the stakes. She and/or her parents will incur another £15,000 of debt in order for that extra degree to be obtained.

Except in the fields of work in which specialist qualifications are required we seem to be approaching a position in which most bachelor's degrees from most universities carry no more weight than A-levels. I find it desperately sad to hear of graduates working in call centres or as junior managers in fast food outlets. The sadness is not in the fact that the particular people are in those particular jobs, they might be exactly the right jobs for them. The sadness is in the false expectation generated in the teenagers who have been pumped into universities.

"Get a degree and you'll get a better job" is patent nonsense, although it was exactly the lie told to justify the last government's target of half the country going to university. There is no sea of unfilled jobs that can only be filled if there are more graduates. Nor are there very many positions in which a degree will allow a junior employee to perform better than he would had he started at eighteen and worked at it for three years rather than being at university for that period.

I have known my friend's son since he was one year old. He is not academically gifted. He's far from thick but he could never do a job that required someone clever. He wants a "graduate job" because he is a graduate. He will be disappointed, all the more so for having a student loan to repay when he finally starts work. My other friend's granddaughter is academically gifted. She already has the qualification to do the job she wants to do, but because the market is flooded with young people with degrees she has to spend another year and a lot of money getting a qualification she does not need.

It's a real dog's breakfast. It's also a classic example of the consequences of government seeking short-term popularity by promising benefits it could never deliver. The result is not young people springing into splendidly well payed jobs that did not exist before, it is young people doing the same job they would always have done but starting it later and with thousands of pounds of debt around their neck.

Cuts for the long term

2010-06-09T03:55:00.005+01:00

It has been interesting to read the reaction of ministers under the previous government to the news that government spending is to be cut hard as soon as possible. Their position is being led by the former Chancellor Alistair Darling. His argument now, as during the recent election campaign, is that government expenditure must be maintained to keep sales churning and should only be reduced when the economy is producing more so that private sector demand is already in place to take over and fuel consumerism when government demand is reduced.

More interesting has been the position taken by the IMF and the European Central Bank in relation to the collapsing Euro-zone economies, a position echoed belatedly by one former minister in the last government. They are all citing the structure of an economy as being more important than transient issues such as this year's level of consumer demand. Yet again my mind goes back to 1976 when the previous Labour government had to beg a massive cash injection from the IMF in order to be able to pay its bills. Among the conditions attached to the IMF loan was a requirement to reduce government spending. Among the conditions attached to the bail-out of bankrupt Greece is a requirement to reduce government expenditure. Among the criticisms of his former colleagues made by ex-minister Lord Myners is their failure to recognise the need to reduce government expenditure.

Mr Darling's argument looks only at the short term. In a way that is understandable. Politicians are scared of some words, one of which is recession. If you can avoid, delay, soften or end recession any path that achieved that end is attractive to those whose careers depend on recession being avoided, delayed, softened or ended. The problem is that it looks at the wrong measure. Recession is, of itself, a pretty meaningless concept. What does it matter if Gross Domestic Product falls by 1% for two consecutive quarters? Why is that awful whereas one quarter's fall of 2% is ok provided the next quarter does not also decline? The answer does not lie in the magic word "recession" it lies in the causes of a sustained fall in economic activity. That there is a sustained fall is consistent with there being an underlying fault but it is not proof that any such fault exists, so recession of itself proves nothing. Similarly a consistent rise in economic activity does not prove that the economy is healthy because the rise might be caused by an unsustainable bubble of credit, as we have seen recently.

The long-term health of a national economy can only be assessed by looking at the overall structure of things and judging whether it is affordable in the long term. In this exercise both the quantity and quality of government expenditure figure large because government takes such an enormous share of national income. Importantly, it is necessary to look at both quantity and quality of government spending because they each have a significant impact albeit in different ways.

The quality issue is being addressed by such matters as ditching pointless quangos and other non-jobs that achieve nothing other than consuming tax revenue. It is also being addressed by trying to ensure that areas of government that do provide some benefit deliver a far larger bang-per-buck. These are not matters that can be addressed easily by international lenders because they are very case-specific and, in some instances, politically sensitive.

The quantity of government spending is a different matter. It affects the whole of the national economy drastically. Every penny government spends must come from one of three tranches of income - yesterday's tax, today's tax or tomorrow's tax. When some emergency arrives that requires exceptional government spending it can use savings made out of yesterday's tax (don't laugh, I'm talking theoretically here). If that is not enough it can channel some of today's tax into the pot and if that is still not enough it can borrow and then repay that borrowing from tomorrow's tax. None of it comes for free. Once the situation is reached of ordinary day-to-day government spending (as opposed to exceptional costs associated with, for example, essential military conflict) requiring borrowing against tomorrow's tax for year after year, you have an obvious structural problem.

Economic growth and its resultant larger tax-take can address that problem to a degree but only to a degree. As the private sector earns more there are entirely reasonable pressures for public sector salaries also to increase, thereby absorbing much of the increased tax revenue and limiting the ability of economic growth to make a significant dent in government debt. There is also the political temptation to spend increased receipts on new pet projects to buy votes at the next election. To pretend, as Mr Darling does, that it is good value to borrow at 4% to maintain aggregate demand that currently produces a 0.1% growth in GDP is to ignore three essential facts.

First, the cost is out of all proportion to the benefit. Secondly, demand is only of a long-term benefit if it results from increased wealth-production rather than from borrowing today to shore-up a standard of living you cannot afford tomorrow. Thirdly, borrowing today means interest payments tomorrow, thereby reducing the amount you would otherwise be able to spend tomorrow and, by definition, reducing tomorrow's demand. So, if you borrow today to support today's demand you do it by reducing tomorrow's demand. Unless, of course, the way you spend it today leads to greater wealth and an increase in tomorrow's demand above what it would otherwise be - something that no government in history has been able to achieve.

No international lender can descend into the minutiae of a particular borrower's economy and seek to identify individual items that will affect the overall long-term sustainability of the whole economy. What can be done is to look at the quantity of government spending, assess the long-term cost if it is maintained and say "sorry chaps, you can't afford to spend that much, I will lend provided you spend less." He is not bothered about maintaining demand this year, he is looking to the overall structure and knows that whatever the level of overall demand in the domestic economy excessive government spending will not be affordable.

If Mr Darling were right the international lenders would not be imposing any conditions on the loans they make. They would want government spending to remain as it is or even increase, they would say "spend more and boost demand, that will increase wealth". Yet they don't say that because they know it is nonsense. They know they will receive interest and the repayment of the capital sum they advance now (and the sums they might be asked to advance in the future) only if governments live within their means.

What matters is not the position this quarter or next or even the position this time next year. What matters is whether a national economy is sufficiently well-balanced to pay for itself (and thereby allow its people to enjoy the fruits of their labour) in the long term. If it is not, those who are asked to bail it out with loans will want an extra return on their money to reflect the risk of default. The institutions that lend to governments comprise other governments as well as private finance bodies, and none of these can afford to forgo interest or capital repayments. Nor do they particularly want to receive a very high return because high interest payable on government debt carries the threat of losing absolutely vast sums if default occurs. Of course they are happy to receive big profits while default is avoided but they know the best long-term investments are those that accumulate steadily not those that can make or lose a fortune over a short period.

It really does not matter if the UK slips back into recession - on any definition it is hardly out of recession anyway. What really matters is that the effect of government on economic activity is not so detrimental that the the nation cannot pay for itself. Once it slips over the edge and cannot pay for itself that imbalance must be dealt with before worrying about anything else. Maybe it will cause the loss of some jobs and a decline in overall spending power this year and next, but that merely reflects that pre-existing levels of both employment in the public sector and consumer demand could not be afforded.

Why it's going to be painful

2010-06-07T23:44:00.005+01:00

At long last Mr Cameron had lifted his head above the parapet and said what everyone knows - government expenditure will have to be reduced by far more than anyone had the guts to say during the election campaign. He said the finances are even worse than he expected, although I doubt if they are much worse because he had a team of generally competent people working for him who only needed to read the blogs of Mr Redwood and Mr Tyler to find a very close approximation to the true horror bequeathed by the most incompetent government in modern history.

Mr Cameron said, quite correctly, that cuts must be made to expenditure because what was inherited cannot be afforded and he said there will be pain. Part of the pain will be felt by those in non-jobs who will have to find something else to do, as I have explained before it is a cruel consequence of creating non-jobs that those who take them in good faith, give up their former careers and then lose their new career. For those who took employment as official State naggers (such as five-a-day consultants, smoking-cessation counsellors and carbon footprint managers) it will be no less than they deserve, but I am sure the hectoring bullies are relatively few in number compared to the administrative staff in their departments who will also have to go.

The reason the pain will be greater than necessary is that hiring useless baggages to suck-up taxes and produce nothing of any value has consequences far beyond their own salaries and pension contributions. They are part of a larger structure, whether it be in local or national government or in a quango. That structure comprises several tiers of employees whose salaries relate, at least in part, to the size of their department. As the department grows through the hiring of people to do nothing, the nominal responsibilities of each head of department increase, carrying with it an inevitable demand that he be paid more. In the tier above him pay must also rise both to maintain differentials and to reflect the supposed additional responsibilities borne by the higher level managers.

Say each head of department was on a salary of £60,000 which increased to £63,000. He or she might have been perfectly happy with £60,000 and undoubtedly they planned their personal financial commitments according to the salary they received. Now they have adjusted their plans to reflect the 5% increase. It might have been no pain to have remained at £60,000 throughout, whereas there is undoubted pain in taking a pay cut of £3,000 a year even when you are on a decent whack. But, of course, the heads of department will still be in place when the non-jobsworths have gone. Either they will have their salaries reduced - a difficult task when the civil service is as heavily Unionised as it is and an even more difficult task because they have the contractual right to receive the salaries that have already been agreed - or their salaries remain in place and the "wasted" additional £3,000 must be clawed back elsewhere.

Then there is office space. In some circumstances an expanded workforce can be housed in existing premises but very often a substantial increase in numbers requires an annex to be rented or bought or the wholesale removal of a department from one building to another. Acquiring and disposing of commercial premises costs money - agents' fees, surveyors' fees, legal fees. Some public bodies have the expertise in house to do some of this work without incurring any out of pocket expenses but most out-source the work so that any problem encountered later can be laid at the door of the external surveyor/solicitor's insurance policy. These fees represent a small annual outlay if spread over the expected lifetime of the new building but they are still additional costs which must be added to the additional costs associated with operating a larger building. On paring-back the workforce you could scale-down your office accommodation but that is also an expensive operation.

Let's take a simple example. Bogshire County Council hires climate change diversity five-a-day outreach empathisers (plus administrative support staff) to work in each department of the council. Their salaries come to £1million a year, acquiring additional office accommodation incurs fees of £40,000, fit-out costs of £100,000 and the extra annual cost of that office accommodation is £50,000. Bogshire can sack the lot and (subject to one-off redundancy payments) save £1million a year. It can't get back the £140,000 it spent on fees and refurbishment and it can't save anything substantial on annual office costs without either selling in a falling market or surrendering the lease on the best terms it can negotiate and then re-acquiring smaller accommodation with all the one-off costs that entails. In order to return to the position it was in before expanding its expenditure beyond affordable levels it would have to eat into the things it was doing before. Assuming there were no non-jobs, useful people doing useful things will have to go or take salary reductions simply to undo the damage caused by hiring useless wasters to do nothing.

Countless further examples can be given of the long-term cost of correcting a structural over-spend. It is a far more expensive exercise than merely getting rid of unnecessary employees.

Smoking is good for you

2010-06-03T01:11:00.004+01:00

A couple of weeks ago I was chatting to one of the owners of my favourite curry house in the restaurant's rear garden and offered him a cigarette. He is only an occasional smoker (a term almost exclusively used by smokers who prefer others to buy the cigarettes they smoke). On lighting the little vitamin stick he inhaled deeply and let out a contented sigh. It is the same sort of sigh I emit at the end of breakfast when I take my first ciggy of the day, only louder and longer because it was a rarer treat for him than it is for me. He did not collapse in a heap or start gibbering, he did not feel the need to steal to fund his next hit; he just sighed. He enjoyed the cigarette. As a smoker I find it impossible to describe the pleasure because it is just part of everyday life, but seeing my friend react as he did reminded me that smoking is a pleasure.

Anti-smokers plug two lines relentlessly. They tell us we only smoke because we are addicted and that smoking is bad for our health. The second might well be true, at least for some smokers, the first is undoubtedly and patently false. If it were the case that smoking is undertaken for no purpose than to feed a drug addiction, I find it impossible to see how it could be such a widespread habit. All over the world people smoke tobacco even though it is not a plant indigenous to their country. They do so despite it costing them money they can ill afford because it gives them something they did not have before. Addiction cannot develop from one taste alone, so even if they do become addicted over time, in the period before they are addicted they smoke solely because inhaling tobacco smoke gives them a pleasure they value at least as much as the money they spend to acquire cigarettes.

One can liken smoking to watching sport or films on television. You can get some for free but if you want more you have to pay. Your choice is to balance the pleasure you derive against the cost. If films don't really toot your flute you might not be prepared to pay anything more than the annual television tax because the number shown on non-subscription channels leaves you satisfied. If you find football and cricket utterly fascinating and can think of nothing better than to spend your evenings and weekends absorbing sporting encounters, you subscribe to Sky Sports 1, 2, 3, ESPN and anything else you can get pumped into your telly.

There is no objectivity about these things because they are matters of personal taste. Some opinionated prig can lecture you about how wasteful it is to spend so much time gawping at the idiot box but in doing so they merely expose their shallow-mindedness. They assume that because they don't do something themselves so others can't possibly get a benefit from it. They assume you to be incapable of forming your own judgment about what is valuable to you and how much you are prepared to pay for it. In short, they fail to realise that we are all different and have different tastes. If challenged to explain how you can justify the cost of numerous optional television channels your answer can only be that you enjoy it and consider it worth the money. No one is in a position to say you do not, cannot or should not enjoy the activity because it is your choice and your choice alone. If the price goes up you face a new choice, should you cut back so that your other bills can still be paid or should you continue the same subscription and make your wife go back on the game; it is the same balancing exercise - how much do you, an individual person, value the film or sports channels. Bert next door might take a different decision but that is neither here nor there, he is not you.

Smoking is also akin to drinking tea. Tea is consumed not just because it contains caffeine, indeed decaffeinated versions are available, it is drunk because ... well, why? The taste? That it is hot? That it is traditional? Frankly, it does not matter. If you want a cup of tea have a cup of tea, you know it will make life better for you even if others cannot stand the stuff. I doubt that any of us can really define the pleasure we get from a cup of tea other than by saying we like it. People might derive all sorts of pleasure, it really doesn't matter. They drink it because it gives them something at a cost they are prepared to pay even if they cannot identify the benefit with any precision.

We can be absolutely certain that people derive a benefit from smoking. The sigh in the garden of the curry house is proof of that as is the prevalence of smoking as a habit all over the world. The one certain downside is the cost. Every smoker has to balance the pleasure he gets against affordability. There is certainly some evidence that smoking can cause health problems for a small number of smokers and no smoker can know whether he or she is at risk. Provided we are informed of the risk we will take it into account alongside price when balancing whether the pleasure we derive is sufficient to justify continuation of the habit.

What is so extraordinary is that the risks are exaggerated enormously these days and some alleged risks are so statistically insignificant as to be pure invention. People know of these non-risks and believe them to be risks, yet still they judge that the pleasure they receive outweighs both cost and risk. If anything, that shows that the pleasure is far higher than any anti-smoking prig could possibly understand.

Yet still they tell us "it's no good for you". Sorry, Mr & Mrs Prig, you couldn't be more wrong. Smokers, like gogglers of movies and televised sport, judge for themselves what is good for them. On one side of the scale they place cost and alleged risk on the other side they place the pleasure they derive. You can measure cost in money but risk and pleasure are matters for individual assessment applying whatever measure any given individual cares to apply. Those who continue to smoke when ciggies are £6 and more a packet and so-called experts tell them they are killing themselves, their children, their friends, neighours and pets, explain by their conduct that smoking is very good for them indeed.

If you don't think it's good for you, don't do it. I haven't spent a single penny at a cinema for almost thirty years because I don't enjoy films sufficiently to be able to justify the cost - films are not good for me. During that time I have spent many thousands of pounds on cigars and cigarettes because I derive a pleasure from their consumption and feel the cost and risk involved are not so high that I cannot justify that expenditure to myself - smoking is good for me.

Docks and the presumption of innocence

2010-06-02T01:13:00.004+01:00

The presumption of innocence is hugely important. Amongst other things it emphasises that the powers of punishment possessed by the State should only be exercised against individuals whose guilt has been proved by reliable evidence. Numerous inroads have been made into that basic principle in the last twenty years, including requiring accused people to prove their innocence in some circumstances and allowing types of evidence to be given that have been considered unreliable for decades and, in some rare cases, centuries. I do not want to discuss those today but to look at something that occurs every day in criminal courts and which I have always considered fundamentally at odds with the presumption of innocence.

I refer to the practice of the accused person having to sit in the dock. As a general rule of courtroom architecture the dock is an enclosed area towards the rear of the court and faces the judge, lawyers involved in the case sit between the dock and the judge. In some older courts, such as the four original courts at the Central Criminal Court (Old Bailey), the lawyers sit on the side opposite the jury but in almost all newer courts the lawyers sit in rows in front of the judge with the dock behind them.

Many docks are raised above the level of the well of the court and the defendant sits in deliberate, exposed isolation as his fate is decided by everyone before him. His legal team cannot just lean over and ask him a question or pass him a note, they have to move to the back of the court and stretch upwards to get their instructions. It draws attention and disrupts proceedings.

In the civil courts the litigants sit with their lawyers. This is useful because it is often necessary to take further instructions during a case and it can be done quietly and without interrupting the trial if the person you need to speak to is beside you or in the row behind. More than that, both the claimant and the defendant are on the same physical level. Although one of them claims that the other has done something wrong, the presumption of innocence applies also in civil cases and this is reflected by the fact that they sit in the same row of seats no matter how bitter their dispute.

Many High Court judges spend most of their lives working as barristers or solicitors on complex civil disputes and then, on being appointed to the bench, are given a pretty constant diet of serious criminal cases to try. Often this means murders and manslaughters. Although long fraud trials are rarer now than twenty or so years ago they still happen and the usual practice now is to dispense with a dock and allow the defendants to sit with their legal team. That practice was first adopted regularly in the late 1980s when the courtrooms used for such cases simply did not have docks because they were not designed as criminal courts. No problem was encountered of defendants doing a runner during the morning smoking break, it all worked rather well and allowed the proceedings to be got through with the minimum of fuss.

That, indeed, is the practice in most States of the USA. Even in cases of capital murder the accused person sits with his defence team in the well of the court. He might be in handcuffs or ankle cuffs, where there is any serious fear that he will abscond he will be in some sort of restraints, but he is presumed innocent of the charge he faces so he faces that charge without being put on an isolated pedestal at the rear of the court like an exhibit in a freak show.

Where there are very solid grounds for believing an accused person might abscond there are also good grounds for him being placed in an area of the court from which escape is difficult. That is, however, a very rare circumstance. In the normal run of things defendants are not kept in custody before or during their trial. They go home at the end of each day and turn up the next day. When in the car or on the bus going to and from court they are just another person, no one gives them a second glance. But when they get to court they are sent to a special confined area and set apart from everyone else involved in the trial.

It could be said that placing a defendant in the dock suggests nothing about his guilt or innocence and is merely giving him a special place because the case is about him. But that misses the point. Everyone with a need to know who is accused will know it regardless of where he sits. By separating him physically you set him apart from everyone else simply because he has been accused. Yet he is not different simply by reason of being accused, he is still presumed innocent just as the judge, lawyers, jury and court staff are presumed innocent whatever they might actually have done.

Let me link this to current news. Today it is reported that two men have been arrested on suspicion of the murder of PC Keith Blakelock in 1985. I popped into the Old Bailey to watch a few hours' evidence when three people were tried for that murder in 1987. It was headline news at the time and a chum of mine was representing one of them, so I thought I'd take a look. I had an afternoon when my paperwork could wait, so went down to the Old Bailey, donned the wig and gown and went into court. The first thing I did (after bowing to the bench, you always have to do that first) was look up at the dock to see "them". And that is exactly how it was, there was a "them", a trio of brutal murder suspects. I didn't view them as just three blokes I might have been sat near in a pub. They had a different character, they were accused of murder and their very presence in the dock identified them as something different from the rest of us. I cannot pretend I looked on them with the presumption of innocence at the forefront of my mind because I did not. Ghoulish though it was, I felt I was looking at three cold-blooded barbarians who hacked a police officer to death with machetes. As you probably know they were convicted but then freed on appeal due to serious deficiencies in the way evidence was gathered. When gawping at them I was not applying a presumption of innocence, I was doing exactly the opposite and the effect was enhanced by all three of them being in the special naughty box.

Docks have been part of our criminal courtrooms for well over a hundred years. Today they are less appropriate than ever because press and TV reporting of serious crimes has become so sensational that the presumption of innocence is undermined long before an accused person appears in court. The very least that can be done is to ensure the courtroom does not add to the isolation of the accused person from all the other "presumed innocent" people in court.

Contentment and the common enemy

2010-05-31T02:07:00.004+01:00

Casting my mind back several decades to my student days I recall observing a phenomenon associated with communal living. Almost all my fellow students spent some time in college accommodation before finding a flat to share with others. In the normal run of things three or four would share because money was extremely tight and the overheads of rent, rates (now council tax), water rates, standing charges for electricity and gas were little different for a three-bedroomed flat than a two so it made sense to get a bigger place and spread the cost three ways or more. I found a flat together with two friends. From the very day we moved in one of them became marginalised, as we would put it today, it was me and my chum against her whenever a dispute arose. Interestingly, the same was seen with all trios of sharers I knew. Indeed when four shared it was three-against-one.

As far as I could tell there was nothing intentionally malicious about it, it was just how things worked out. When there was a dispute about what colour to paint the living room or whether to buy logs or coal for the fire a decision had to be taken and the majority would rule. What I found interesting at the time and find interesting still is that being in the majority added to the pleasure of life. Had we all agreed about everything there would have been no sense of victory or accomplishment in getting ones way. It goes without saying that on a great many matters we were all in agreement, disputes were few and never bitter nonetheless I found elation in being on the winning side when push came to shove. The victors went to the pub and gloated, criticising their common enemy in order to boost their egos. Without a common enemy that experience would have been lost, there would have been no victory and no elation, life would have been less enjoyable.

What was absurd about the whole situation was that our flatmate was not really our enemy at all. She was a lovely girl and, I presume, is now a lovely middle aged lady; but she was our enemy for certain limited purposes and in that capacity she enhanced our lives. Sadly I have now lost contact with both old flatmates, for all I know they are in contact again and bitching about me.

We see the same phenomenon in all sorts of circumstances. In the workplace the foreman or manager is seen as the enemy of the serfs and forcing him to reverse his position gives pleasure far beyond any temporary material benefits that are received. A football club goes through a bad run and the supporters turn on the manager or owners. They get their way and cheer the replacement manager/owner to the rafters until next season when the exercise is repeated. Do they really cheer the new manager or owner, or do they cheer themselves for having won a battle whether or not the club's fortunes improve? British Airways cabin crew seem to be following this pattern with their current series of strikes. They might or might not gain long term benefits if the strikes result in their present demands being met, but you can be sure their greater pleasure would be winning the battle rather than enjoying what happens next.

It is only a short step to offer the prospect of winning battles as a political strategy to gain support. It matters not whether winning these particular battles will benefit those whose support you seek because they will support you for the chance of enjoying victory even if it leaves them out of pocket or out of work. This has been seen over the last couple of years with calls for penal rates of tax on "The Rich". No one can be certain that the future will mirror the past but all experience from around the world indicates that taxing income at more than around 40% results in a fall in tax revenue (because some move overseas to avoid it, some deliberately earn less and others find it worthwhile to spend a few quid on a specialist accountant to reduce their tax bill to the absolute minimum possible). That evidence suggests that a proposal to tax income at 50% would be counter-productive and should not be tried because it is likely to require higher taxes on the non-rich to make up the shortfall.

The policy has nothing to do with raising revenue and everything to do with gaining support from those who are encouraged to believe there is a group known as "The Rich" against whom a victory can be won. Support is given because the non-rich smell the sweet scent of victory, they sense the chance to get one over an opponent. The opponent only exists as an opponent because he has been described as such by those who invent the battle. Once the policy becomes law those who were persuaded to support it have won, they feel good, their lives have been enhanced by being a winner. Yet it seems likely from past experience that they are the very people who will have to pay when the policy backfires. That doesn't matter to the politicians, they will put forward a different excuse for having to raise taxes on the non-rich, their concern is getting votes by any means they can.

Lest either of my readers is tempted to tell me of Mencken's hobgoblins don't bother, I know them well but my point is different. He asserted, I believe correctly, that setting up mythical ogres gains votes because people want to be protected from the threat those ogres appear to pose. My point is that the prospect of victory against a fictitious enemy gains votes because victory is a benefit in itself whether or not the defeated person posed any threat. Promise the thrill of victory, any victory, and people will say "yes please, I'd like a slice of that". They say it because they know it will make them feel good. The more bitter, envious and spiteful they are, the better it will make them feel. It is a perfect tactic for the political left.

Laws' Choice

2010-05-29T23:23:00.003+01:00

So, less than three weeks in and a cabinet minister has resigned. David Laws was found to have claimed reimbursement from the Treasury for renting a room from someone called James Lundie when he was actually in a sexual relationship with Mr Lundie and therefore living with him rather renting from him. I know not whether Mr Laws paid Mr Lundie the sums he claimed as expenses. I have heard it suggested that the nature of their relationship meant Mr Laws could have claimed reimbursement of the whole of Mr Lundie's mortgage interest payments, again I do not know whether that is the case and for present purposes it doesn't matter. Mr Laws initially explained his error as being due to not wishing to reveal his homosexuality. If I understand his position correctly, it is that he felt claiming to be a lodger would not arouse suspicion whereas any other claim might have done so.

David Laws had three options. He could have declined to claim any reimbursement for his London housing costs. If asked about it, he could have said he was staying with a friend rent free or that he stayed with a friend and made a contribution to costs but chose not to claim in order to save the taxpayer expense. His second option was to tell the whole truth and claim the maximum the rules allowed. His third option was to lie and claim something on a false basis - perhaps more than he was entitled to, perhaps less. He chose the third option. Silly boy.

For all his faults, the late Prime Minister Ted Heath always played this subject perfectly. When asked any question relating even obliquely to his sexuality he gave the same dead pan response: "I don't talk about these things". That was it, topic over, it was none of the interviewer's business and nothing was being volunteered. As far as I am aware neither Ted Heath nor David Laws has ever expressly asserted that they were not homosexual. Had they done so it would not have been an option to say "I don't talk about these things" because he would have done exactly that.

Indirectly Mr Laws did deny his homosexuality by claiming reimbursement of rent because rent paid to a sexual partner could not be claimed under the rules as they were at the time. (I refuse to sink so low as to refer to any such partner as a rent boy.) By claiming reimbursement of rent he was asserting that the person to whom it was paid was his landlord and not his "partner". That was untrue. He obtained money by asserting a falsehood. That is fraud. That he might have been entitled to claim the same or more money by telling the truth mitigates the offence. Indeed it might be such strong mitigation that no fair minded prosecutor would think it sensible to pursue criminal proceedings against him. It might even be such strong mitigation that a return to a senior position in government will be possible within a short period of time although I hope not, a propensity to fraud should be a disqualification for office not a requirement as it has been for the last decade.

Mr Laws' choice was to preserve his privacy and forgo money or to forgo his privacy and receive money. Preserving his privacy and receiving money was not an option without acting fraudulently and jeopardising his whole career. It is a shame he chose the corrupt option but he has now done the right thing and resigned. And all for £40,000 he now has to repay.

Lies, spin and goodwill

2010-05-27T00:49:00.004+01:00

Whether you work in a trading business or a service business, your profitability is determined by your customers. It is easy to think of the profitability of a shop or a firm of architects being determined by how much money is received compared to how much money goes in costs and that is obviously the case in each individual accounting year. But what about next year? What you do this year and did in past years can have a significant effect on how well you do last year through the invisible power of goodwill.

The goodwill of a business is named aptly. Repeat business comes from keeping your customers happy and hoping they tell their friends about you. You generate goodwill among potential customers and that goodwill translates into custom in the future. When a business is sold it is common to find the price broken down between property, stock, debts owed to the business and goodwill. Ripping people off might turn a few quid now but it dissuades them from patronising your business again. So too if you are in a service business and provide a shabby service. The customer who has already engaged you might keep you on to finish the job because it would be more trouble to hire someone else to take over, but he won't use you again and might warn his friends and neighbours that you are to be avoided. This is all pretty obvious stuff.

The more competitors you have, the more you are likely to suffer in the future by letting down a customer today. That is one of many reasons why we have laws and regulations to limit the number of monopolies and place restrictions on those that do exist - give a monopoly free-rein and you create ideal conditions for a modern equivalent of the wartime spiv. The best explanation of this phenomenon I have ever come across came from the old television comedy Dad's Army. One of the characters is a spiv, a black marketeer, who offers something for sale for five shillings (I think it was knicker elastic, it usually is in English comedies) only to be faced by the comment "but it's only two shillings in the shops", to which he responds "ah, but you can't get it in the shops". Because only he could supply knicker elastic he could charge the highest price he felt his customers would be prepared to pay. Monopolies lead to higher prices, competition leads to lower prices because suppliers have to fight for your custom. Some suppliers will charge more and be busy because some customers value not just price but customer service, that's all part of the same thing - they offer something extra that people enjoy and are prepared to pay for.

My question today is: given all that I have written above, why do so many people lie to their customers when there is a problem rather than telling them the truth? The reason I ask is that I was talking to someone I know who has written and self-published a book, a "how to" guide to a particular craft. She keeps a stock of books in her garage and posts copies to individuals and craft shops as and when orders are placed. Every year or so she has to have a few thousand more printed and lets the printer know how many she needs. She's a well-organised person and arranges a reprint months in advance of the date she is likely to run out of stock. This year she ordered another five thousand and was given a date for their likely delivery. Two weeks before that date she telephoned and was assured everything was in place for that date to be kept. The date arrived but the books did not. Over the next few weeks she was given all sorts of promises of imminent delivery. In the end she received them three months late.

She had received an unusually high number of orders and her existing stock was exhausted a week after the original date set for delivery of the new print run. Being a sensible lady who wears sensible shoes, on receiving a new date from the printer she told her waiting customers of that date, only to have to do so again and again as lie after lie was told to her by the printer. Fortunately no one cancelled their order but the interruption to efficient delivery might have an effect in the future.

The true position was that the manager of the print shop had suffered a family misfortune which required him to spend a lot of time away from work - a fact only divulged once the books were printed and dispatched - causing the printing of everything in their catalogue to be delayed. Had the truth been told, her customers would have been told the same thing and everyone would know it was just one of those hitches that occurs from time to time through nobody's fault.

Customers make all sorts of allowances when they are kept informed of a problem that has arisen, allowances they will not hold against their supplier provided they do not later discover that the information they were given was simply a lie. Had the printing firm said "Mr Snodgrass's son is very ill and Mr Snodgrass can only be here a couple of days a week, we are running on 50% capacity so there will be a delay" the author would not have known when she would receive her books but she would have an explanation she could pass to her customers and the likelihood is that no goodwill would be lost between printer and author nor between author and putative reader.

As it is, she is looking for another printer because she was told numerous inconsistent untruths including: "we've started, it won't be long", followed by "it's next on the list, it won't be long" and then "we're waiting for paper supplies and yours is the first one to be done once they arrived". All of it garbage, all of it lies, all of it has lost goodwill.

That is just one example but I have encountered many examples of the same thing in recent years. Something goes wrong and there is no apology or truthful explanation, instead a load of deflective spin is spewed out to try to buy time. It does buy time but so would telling the truth and the latter would also retain goodwill.

To judge the EU, judge the Euro

2010-05-26T01:15:00.006+01:00

I have never been one for grand conspiracy theories except in one area, the European Union. Even then I don't go for the more sinister accusations about the intentions of our friends in Brussels (then Strasbourg for a few days and then Brussels again). I cannot accept that the intention of (most) of those behind the EU project is to create a brutal totalitarian state, rather I think they probably believe that political and economic integration based around a single bureaucratic, not democratic, Europe-wide government will be of benefit to the little people. In order to seek that end the grand pooh-bahs of the European integration project have lied about their intentions since those intentions were first formed.

Across the English Channel lying is part of the normal currency of business and personal relations. Here in blighty it is generally looked on somewhat differently, as the conduct of a scoundrel. The French know their politicians lie all the time and don't care because they don't consider much wrong in the telling of an untruth. We know our politicians lie all the time and it raises our blood pressure because we believe it makes them unfit for office yet still they get big salaries.

That is not the topic of today's meandering, I just wanted to say it. Today's topic is not about how they seek to impose their hidden agenda but about something much more fundamental - the structural problem that undermines the whole concept of EU economic integration and the Euro in particular.

It is a problem that affects the UK as well and can be illustrated by manufacturing. Although manufacturing industry has taken quite a battering as developing countries have been able to undercut the prices UK producers need to charge to break even, we still make a lot of stuff. In fact I recall reading somewhere that we are the ninth or tenth largest manufacturing economy in the world, it didn't sound right to me but it might well be because we have a lot of small factories producing specialist stuff and a few big manufacturing plants remain and what we sell tends to go for quite a high price (if it didn't we couldn't afford to produce it).

Those that use predominantly home-produced raw products and sell predominantly to the home market are affected almost exclusively by domestic economic conditions. Those that import raw materials and sell in the home market want the pound to be strong against the currency in which they must pay for their supplies. Those that use domestic raw materials and mainly export want the pound to be weak so that their goods can be sold cheaper overseas and undercut competitors. Those that import raw materials and sell overseas will be less affected by the pound rising or falling in value - a rise makes materials cheaper but sales more difficult and the reverse is seen when the pound is weak. Within England there exist thousands of businesses that want a strong pound and thousands that want a weak pound. It is impossible for both camps to be satisfied all the time. So it is also with interest rates. Some businesses benefit from rates being high and others can only survive if they are low. You can't keep everyone happy all the time.

If there were a government for a county that is heavily dependent on imported materials it would be reasonable to expect it to aim for its currency to be strong (so that things manufactured there for export will be cheaper for the customers). By contrast the government of a county heavily dependent on tourism would want Johnny Foreigner to come in droves, so it would work towards a currency that is weaker than its rivals in order to maximise the chance of attracting business. As it is, within the UK we have massive differences between different counties and a single currency, the pound, applies to all. Some gain and some lose when the pound falls or rises in value compared to other countries. We put up with that because what ties us together as a single country is much more than economic interests.

Not so, the Euro zone. No matter how much each country tried to manipulate its interest rates, exchange rates and trade cycles to try to find common ground with other Euro zone countries before joining the club, fundamental differences between the various national economies would always remain and will change as time moves on - some will become more dependent on manufacture, some more dependent on services, some more dependent on leisure and so on. Just as strains arise between different areas of the UK in certain economic conditions so they arise between Euro zone countries. The difference is that cultural and historical ties exist to keep the UK as the UK (until we have the good sense to let Wales and Scotland free to spend only their own money) whereas the only ties binding the Euro countries are those created by the Euro itself.

The collapse of the Greek economy illustrates a consequence of the structural problem behind the entire Euro experiment. In a sane world Greece would allow its currency to fall until it found its natural level - the level at which those who do not trade with Greece will find it attractive to do so thereby allowing the Greek economy to stabilise. It might also need a bail-out from the IMF, or the US, or China, or David Beckham because its governments have been absurdly profligate for years, but it would not be constrained by its currency having an international value that simply does not reflect the reality of Greece's position. That constraint will continue for so long as it is in the Euro zone because the exchange rate of the Euro is determined not just by how the rest of the world sees Greece but by how it sees the whole package of Euro zone countries.

More importantly, the rise or fall of the Drachma would have influenced Greek economic policy and might (it is no more than a possibility) have prevented the collapse we have seen recently. The Euro bureaucrats had no way of sending a message to the Greek people that things were going wrong and no inclination to do so because the very existence of the Euro project has always been more important to them than the Euro's effectiveness as a currency.

Having a single exchange rate and "official" rate of interest does not suit each county in the UK let alone each country and province. It is tolerated for reasons that have little if anything to do with economics. Having a single exchange rate and official interest rate for all Euro zone countries cannot work in the long term because the time will come when it will not be tolerated by those whose financial position suffers beyond the limit of political endurance.

We might be getting close to that point, the sooner it arrives the better. With any luck it will expose the whole EU project as the political equivalent of the Euro.