Following the story over the weekend, and fascinated by the sight of a traditional "run on the bank", I also saw, as expected, the government and the Bank of England team up to guarantee the bank's savings deposits. The Bank offers a line of credit, and the government essentially underwrites as much as is found to be necessary. The government's support is underwritten by the taxpayers.
All perfectly normal, good practice. One thing did occur to me though. I am not sure that such a co-operation to protect a bank could happen in the euro-zone.
As I understand it, the European Central Bank is different in that it is not linked to a government with tax-raising power. Uniquely, it is entirely independent and while it holds the currency reserves of the dozen or so central banks in the zone, the implicit or explicit support of the taxpayers of Europe is not extended to supporting the ECB.
Now, I may be wrong in this. Perhaps the central banks retain the power to issue credit without limit to a bank in trouble. Perhaps the ECB has power to do this anyway. But I am sure that this is what I read years ago when the euro was getting off the ground. It was seen (perhaps by Bernard Connolly) as a fantastic, grotesque gamble with the savings of most Europeans. The politicians were gambling that they could get a constitution in place before a financial crisis (such as had happened with the American S & Ls a few years before) came along and wiped out savings.
Anyone correct me on this?
Tuesday, 18 September 2007
Thursday, 30 August 2007
Someone's mad at Adminajad
There's an old saying that when the gods wish to destroy someone, they first drive him mad.
The President of Iran has sacked his central bank chief, as well as replacing the finance minister. He apparently wants to get more control over the economy. Like recently when he ordered banks to lend money cheaply as a means to fight inflation.
One can't help feeling that government intervention is more likely to be the cause of the problem, not the solution.
40% annual inflation, soaring unemployment, an oil-rich country needing to import petrol - sounds more like mismanagement.
Managing a modern economy needs modern methods, not those of the middle ages. Trying to do it during a vast arms build up and useless investment in nuclear armaments - well, that takes some doing at the best of times, and not least a little humility is needed.
Unless he's supposing that all problems can be overcome if you want it enough, in a modern "Triumph of the Will".
The President of Iran has sacked his central bank chief, as well as replacing the finance minister. He apparently wants to get more control over the economy. Like recently when he ordered banks to lend money cheaply as a means to fight inflation.
One can't help feeling that government intervention is more likely to be the cause of the problem, not the solution.
40% annual inflation, soaring unemployment, an oil-rich country needing to import petrol - sounds more like mismanagement.
Managing a modern economy needs modern methods, not those of the middle ages. Trying to do it during a vast arms build up and useless investment in nuclear armaments - well, that takes some doing at the best of times, and not least a little humility is needed.
Unless he's supposing that all problems can be overcome if you want it enough, in a modern "Triumph of the Will".
Sunday, 26 August 2007
"More Money for Bastards"
This title of this post is a quote uttered by a panellist on the BBC show "Mock the Week" This is a usually funny topical news quix interspersed with jokes and stuff. The subject came up of new Conservative policies.
One panellist mentioned the policy of cutting taxes on business. "Which means", he said "More money for bastards".
One wonders just how to respond to such unfunny and crass stupidity. It's wrong on so many levels.
In the first place, taxes on business are taxes on shareholders. Many of these are not rich, and how can anyone say how many of them are "bastards"?
The sheer prejudice encapsulated in the remark is staggering. Suppose a panellist said "More money for the unemployed - means more money for lazy bastards?" Or "Help for immigrants - more money for welfare scroungers". Or "Moslems - they're all murdering bastards." Or "Christians - they're all hypocrites".
Only shareholders and businessmen, it seems. can be slagged off by the BBC.
On another level, who does he think creates the wealth that payes the tax that goes to teh BBC and pays his appearance fee? Without business there's no wealth at all.
And also, the easy to understand principle of tax incidence applies - who actually pays a tax.
Taxes on business don't fall on the business in a vacuum. It is a cost imposed on business, so inevitably raises prices. If business taxes were cut, we might see inflation fall but the businesses would be more profitable so wages can go up.
There's always a case to cut business taxes to nothing, on the grounds that the simpler the tax system the better. See Tim Worstall for arguments better than I can put it.
One panellist mentioned the policy of cutting taxes on business. "Which means", he said "More money for bastards".
One wonders just how to respond to such unfunny and crass stupidity. It's wrong on so many levels.
In the first place, taxes on business are taxes on shareholders. Many of these are not rich, and how can anyone say how many of them are "bastards"?
The sheer prejudice encapsulated in the remark is staggering. Suppose a panellist said "More money for the unemployed - means more money for lazy bastards?" Or "Help for immigrants - more money for welfare scroungers". Or "Moslems - they're all murdering bastards." Or "Christians - they're all hypocrites".
Only shareholders and businessmen, it seems. can be slagged off by the BBC.
On another level, who does he think creates the wealth that payes the tax that goes to teh BBC and pays his appearance fee? Without business there's no wealth at all.
And also, the easy to understand principle of tax incidence applies - who actually pays a tax.
Taxes on business don't fall on the business in a vacuum. It is a cost imposed on business, so inevitably raises prices. If business taxes were cut, we might see inflation fall but the businesses would be more profitable so wages can go up.
There's always a case to cut business taxes to nothing, on the grounds that the simpler the tax system the better. See Tim Worstall for arguments better than I can put it.
Friday, 10 August 2007
Classic kibbutz moment
In 1974, I worked on a kibbutz for six months. At the end of that time, I experienced something that sums up the old kibbutz movement.
I was told that because I had been there six months, I was entitled to draw the ration of casual clothes, to keep as my own. (Work clothes were already given out, and were taken in each week for washing. You didn't get the same ones back.)
So I did as I was told and turned up to the laundry. A shipment of casual trousers and shirts had been brought in and were laid out on the tables and shelves.
All the kibbutz boys (handsome, athletic) and girls (curvy, long-haired) aged between 18 and 25 seemed to be there. They were undressing and trying on the various shirts and jeans.
I did the same, and eventually selected a dark-blue pair of jeans and a smart shirt.
I signed for them and left. No money changed hands.
So, that's everyday socialism. You get what you need, by right of residence and working.
But also, you select from the management's choice, when they choose to give you one. You don't get cash instead, to go to spend it where you want.
So that's the original kibbutz moment.
I was told that because I had been there six months, I was entitled to draw the ration of casual clothes, to keep as my own. (Work clothes were already given out, and were taken in each week for washing. You didn't get the same ones back.)
So I did as I was told and turned up to the laundry. A shipment of casual trousers and shirts had been brought in and were laid out on the tables and shelves.
All the kibbutz boys (handsome, athletic) and girls (curvy, long-haired) aged between 18 and 25 seemed to be there. They were undressing and trying on the various shirts and jeans.
I did the same, and eventually selected a dark-blue pair of jeans and a smart shirt.
I signed for them and left. No money changed hands.
So, that's everyday socialism. You get what you need, by right of residence and working.
But also, you select from the management's choice, when they choose to give you one. You don't get cash instead, to go to spend it where you want.
So that's the original kibbutz moment.
Modern kibbutz moment
I recently visited a kibbutz in israel, where I worked for a few months in 1974. Like most of the kibbutz movement, and the country itself, it is very different now.
They used to have a herd of cows, orchards, beehives, glasshouses for roses, chickens, a shoemaker's workshop. The chickens and the roses have gone, the shoemaker died and his workshop is now a fitness centre. The dairy is larger, they took over a herd of the nearby settlement.
In 1974, the system was straightforward. Strict equality, goods and services awarded according to need, all persons work where they are told to, no differentiation in gross income. Cash was used for the relatively low level of personal spending. Holidays abroad were awarded by choosing recipients by lot.
So changed now.
· The same kibbutz has gone over to cash for salaries and pensions.
· Persons doing more valuable work get higher salaries to reflect that.
· The kibbutz has declined in population by nearly a third. The empty houses are rented out. So: the modern kibbutz is a landlord.
· The kibbutz focuses on high value added activity and exports a lot. The kibbutz participates in the global market.
· The kibbutz has a factory, with a 100 staff. The kibbutz is an investor and entrepreneur. · Half the staff are members, the rest are outside workers, both Jews and Arabs. The modern kibbutz is an employer of wage labour.
· The nuclear family has re-emerged on the kibbutz. The children's houses are no longer used during the night.
· The gardens were originally open-plan, with lawns and trees. Now, the residents mark out their parts with little fences and shrubs. I even saw one mowing his lawn.
The modern kibbutz - where you cook for yourself, look after your children yourself, and mow your own lawn.
Just like a suburb anywhere . . . so that's the modern kibbutz moment.
They used to have a herd of cows, orchards, beehives, glasshouses for roses, chickens, a shoemaker's workshop. The chickens and the roses have gone, the shoemaker died and his workshop is now a fitness centre. The dairy is larger, they took over a herd of the nearby settlement.
In 1974, the system was straightforward. Strict equality, goods and services awarded according to need, all persons work where they are told to, no differentiation in gross income. Cash was used for the relatively low level of personal spending. Holidays abroad were awarded by choosing recipients by lot.
So changed now.
· The same kibbutz has gone over to cash for salaries and pensions.
· Persons doing more valuable work get higher salaries to reflect that.
· The kibbutz has declined in population by nearly a third. The empty houses are rented out. So: the modern kibbutz is a landlord.
· The kibbutz focuses on high value added activity and exports a lot. The kibbutz participates in the global market.
· The kibbutz has a factory, with a 100 staff. The kibbutz is an investor and entrepreneur. · Half the staff are members, the rest are outside workers, both Jews and Arabs. The modern kibbutz is an employer of wage labour.
· The nuclear family has re-emerged on the kibbutz. The children's houses are no longer used during the night.
· The gardens were originally open-plan, with lawns and trees. Now, the residents mark out their parts with little fences and shrubs. I even saw one mowing his lawn.
The modern kibbutz - where you cook for yourself, look after your children yourself, and mow your own lawn.
Just like a suburb anywhere . . . so that's the modern kibbutz moment.
Thursday, 7 June 2007
The Bible and productivity
I remembered a Bible text recently and it set me thinking. It turned out to be quite profound. No doubt this view is not original, but still . . . . it's mine.
The text is Leviticus 19, v 9 - 10.
Extract (KJV): "And when ye reap the harvest of your land, thou shalt not wholly reap the corners of thy field, neither shalt thou gather the gleanings of thy harvest . . . . thou shalt leave them for the poor and the stranger."
The first thing that comes to mind is this: the Bible is telling us that we should not drive for maximum productivity and profit margin, but that we should consider the position of the poor and needy.
The context makes it clear that it isn't about giving alms to the poor, or paying taxes to support them. It's about the actual production process; we are ordered, by the Lord, no less, that the poor should be involved in gathering some sustenance at least from the productive capacity of the counry and region they live in.
Of course, not many live by gleaning nowadays (if ever). But there are numerous ways in which this Biblical injunction is still kept, quite unconsciously. It is kept, in short, whenever compassion for a person's circumstances leads managers and owners of businesses to be less than totally ruthless in getting value from labour.
For example:
The woman in the back of the office who makes mistakes but her workmates cover for her because she's going through an awkward divorce.
The old man who is kept busy doing work that a machine could do, but the foreman likes having someone he can call on for odd jobs.
The manager who allows the local scrap dealer to take away surplus metal but doesn't charge very much because it's good policy to buy services locally.
We can all think of similar examples. They are the little ways in which humanity takes the edge off the tough commercial world.
On the wider scale, it's always better for a society to allow the poor to work and contribute in some measure to the society, than to have them live off the latter day version of alms, the social welfare, which in the old English phrase is "as cold as charity".
The "Anglo-Saxon model", as it is called, maximises employment and then tops up earnings with welfare. The "Continental model" - such as France and Germany - attempts to help the poor by telling business to pay them the minimum wage. The result is unemployment and a ruthless drive for productivity which replaces men with machines at the lower end of the job market.
We shall see, eventually, which one will survive the longest.
Update: I had an e-mail from Germany querying the opposition to the minimum wage, and recommending a citizen's basic income.
Oddly enough, I support the idea in pinciple, though I wonder about the practicality. (Also a bit worrying - "You're a citizen, you get a basic income. You're not, so buzz off and starve.")
Leaving aside that, I wonder if there isn't a simple error creeping into the debate.
The distinction between "wage" and "income" isn't always clear. Guaranteeing a minimum wage per hour is nto the same as guaranteeing a minimum income over the year.
Furthermore, the concept of "income" ought to include the benefits provided in kind, in goods and services funded from taxation or national insurance.
And the traditional socialist argument that the "social wage" (roads, waste disposal, clean water, etc.,) must be taken into account in assessing welfare should be dusted off for a re-think.
Regarding the minimum wage: suppose there are three people doing a basic job in a factory. They are doing the same work, same output per hour. The work is simple so the wage is low.
But the workers are not identical in their needs. One may be a student taking a year off before going to university, and still living at home. One may be a person nearly retired, with no mortgage to pay and working to pay for a nice holiday. One may be a single mother with two children.
Their needs are different. If the wage is raised artificially to help the needy one (the third) then the others say "Thanks very much, more beer money for us".
(There's anecdotal evidence that the main beneficiaries of minimum wage legislation are young single people in rich areas who have easy holiday jobs).
And we should not assume that the employer is necessarily making a profit from the lowwages - that may be the case, but it might not be.
So the employer may decide to invest in a machine to do the job - he won't make anyone redundant, but the one will retire and student will go to univeristy and there are two fewer jobs for the next student.
If, however, the wage is set at the market level, then the employer still provides the jobs, and more people are involved in work.
The student will still get his subsidised training, the mother will still get help with rent and child benefit, the retired person can work to retirement.
Targetting benefits to need works just as well in a market-wage society as in a minimum-wage one. And it maximises contributions to society through work.
"From each according to his ability, to each according to his needs".
And before anyone says it: yes, some employers are making money out of paying low-wages for valuable work. Certainly unfree labour is an evil, and factory inspectors can shut down unhealthy workplaces. But the best weapon against such employers is free-trade. Other employers will offer better wages and still make a profit - if they are allowed to set up in that market. Barriers to entry have to be low.
The text is Leviticus 19, v 9 - 10.
Extract (KJV): "And when ye reap the harvest of your land, thou shalt not wholly reap the corners of thy field, neither shalt thou gather the gleanings of thy harvest . . . . thou shalt leave them for the poor and the stranger."
The first thing that comes to mind is this: the Bible is telling us that we should not drive for maximum productivity and profit margin, but that we should consider the position of the poor and needy.
The context makes it clear that it isn't about giving alms to the poor, or paying taxes to support them. It's about the actual production process; we are ordered, by the Lord, no less, that the poor should be involved in gathering some sustenance at least from the productive capacity of the counry and region they live in.
Of course, not many live by gleaning nowadays (if ever). But there are numerous ways in which this Biblical injunction is still kept, quite unconsciously. It is kept, in short, whenever compassion for a person's circumstances leads managers and owners of businesses to be less than totally ruthless in getting value from labour.
For example:
The woman in the back of the office who makes mistakes but her workmates cover for her because she's going through an awkward divorce.
The old man who is kept busy doing work that a machine could do, but the foreman likes having someone he can call on for odd jobs.
The manager who allows the local scrap dealer to take away surplus metal but doesn't charge very much because it's good policy to buy services locally.
We can all think of similar examples. They are the little ways in which humanity takes the edge off the tough commercial world.
On the wider scale, it's always better for a society to allow the poor to work and contribute in some measure to the society, than to have them live off the latter day version of alms, the social welfare, which in the old English phrase is "as cold as charity".
The "Anglo-Saxon model", as it is called, maximises employment and then tops up earnings with welfare. The "Continental model" - such as France and Germany - attempts to help the poor by telling business to pay them the minimum wage. The result is unemployment and a ruthless drive for productivity which replaces men with machines at the lower end of the job market.
We shall see, eventually, which one will survive the longest.
Update: I had an e-mail from Germany querying the opposition to the minimum wage, and recommending a citizen's basic income.
Oddly enough, I support the idea in pinciple, though I wonder about the practicality. (Also a bit worrying - "You're a citizen, you get a basic income. You're not, so buzz off and starve.")
Leaving aside that, I wonder if there isn't a simple error creeping into the debate.
The distinction between "wage" and "income" isn't always clear. Guaranteeing a minimum wage per hour is nto the same as guaranteeing a minimum income over the year.
Furthermore, the concept of "income" ought to include the benefits provided in kind, in goods and services funded from taxation or national insurance.
And the traditional socialist argument that the "social wage" (roads, waste disposal, clean water, etc.,) must be taken into account in assessing welfare should be dusted off for a re-think.
Regarding the minimum wage: suppose there are three people doing a basic job in a factory. They are doing the same work, same output per hour. The work is simple so the wage is low.
But the workers are not identical in their needs. One may be a student taking a year off before going to university, and still living at home. One may be a person nearly retired, with no mortgage to pay and working to pay for a nice holiday. One may be a single mother with two children.
Their needs are different. If the wage is raised artificially to help the needy one (the third) then the others say "Thanks very much, more beer money for us".
(There's anecdotal evidence that the main beneficiaries of minimum wage legislation are young single people in rich areas who have easy holiday jobs).
And we should not assume that the employer is necessarily making a profit from the lowwages - that may be the case, but it might not be.
So the employer may decide to invest in a machine to do the job - he won't make anyone redundant, but the one will retire and student will go to univeristy and there are two fewer jobs for the next student.
If, however, the wage is set at the market level, then the employer still provides the jobs, and more people are involved in work.
The student will still get his subsidised training, the mother will still get help with rent and child benefit, the retired person can work to retirement.
Targetting benefits to need works just as well in a market-wage society as in a minimum-wage one. And it maximises contributions to society through work.
"From each according to his ability, to each according to his needs".
And before anyone says it: yes, some employers are making money out of paying low-wages for valuable work. Certainly unfree labour is an evil, and factory inspectors can shut down unhealthy workplaces. But the best weapon against such employers is free-trade. Other employers will offer better wages and still make a profit - if they are allowed to set up in that market. Barriers to entry have to be low.
Tuesday, 5 June 2007
England forever !
There's a lot on the internet at least about the English "national identity". Especially since the government comes up with its cack-handed proposal for a "Britain Day". First they erode democracy with devolution to everone but the majority, thereby creating two classes within the country, then they want to celebrate the "things that we have in common".
A sense of fair play, for starters.
And a recognition that England is a country - perhaps start by getting Europe to put the name on its map? And to give us a vote on devolution.
We only want the rights everyone else has.
But to the point.
One can hear people denying that there is an "English national identity". After all, there are so many different cultures that make up the country, so many different national origins, they aren't really one nation, are they?
Are these commentators on another planet? Does anyone say that the Welsh are a single culture? Are the Lowland Scots the same as the Highlanders? Blue and Green Glaswegians wouldn't agree they are the same. And the Northern Irish?
The fact is - and it's a remarkable fact that this is rarely noted - that the English are what they are simply because we all live here.
There is no requirement to be of "English blood". (Unlike Germany, which still has a race-based nationality).
Just one simple question: are you born here? Makes you English.
Or, you voluntarily come to live here and to submit to our laws.
England is here, and will not go away. And don't forget that.
Years ago, I lived abroad and had to fill in official forms.
Address: easy - "United Kingdom".
Nationality: easy - British passport, so "British".
Country of birth: I often paused and wondered what to put. Neither of the above options seemed right. Eventually I settled on "England", but did wonder what the significance was.
Now I know. England is home, England is the source of our liberties and traditions and rights. England is forever.
A sense of fair play, for starters.
And a recognition that England is a country - perhaps start by getting Europe to put the name on its map? And to give us a vote on devolution.
We only want the rights everyone else has.
But to the point.
One can hear people denying that there is an "English national identity". After all, there are so many different cultures that make up the country, so many different national origins, they aren't really one nation, are they?
Are these commentators on another planet? Does anyone say that the Welsh are a single culture? Are the Lowland Scots the same as the Highlanders? Blue and Green Glaswegians wouldn't agree they are the same. And the Northern Irish?
The fact is - and it's a remarkable fact that this is rarely noted - that the English are what they are simply because we all live here.
There is no requirement to be of "English blood". (Unlike Germany, which still has a race-based nationality).
Just one simple question: are you born here? Makes you English.
Or, you voluntarily come to live here and to submit to our laws.
England is here, and will not go away. And don't forget that.
Years ago, I lived abroad and had to fill in official forms.
Address: easy - "United Kingdom".
Nationality: easy - British passport, so "British".
Country of birth: I often paused and wondered what to put. Neither of the above options seemed right. Eventually I settled on "England", but did wonder what the significance was.
Now I know. England is home, England is the source of our liberties and traditions and rights. England is forever.
Saturday, 2 June 2007
Protestantism & wealth
http://andrewleigh.com/?p=1477
The above link connects to a study which queries the basis of the "Protestant ethic" explanation for wealth creationm expounded by Max Weber.
Briefly, this theory states that the teachings of Protestantism created the conditions for economic growth. Protestantism recommends that we be thrifty, careful with money, scorning adornment and superficial conspicuous consumption; that we shoudl save for the future, just as we look to the life after death.
A sub-set of the theory states that Calvinism in particular taught that only the elect go to heaven, but nobody knows who they are. Because God blesses those who believe in him, then your wealth indicates how blessed you are and is an indicator of whether you are one of the elect. So Calvinists become wealthy.
The theory isn't popular nowadays, except the bit about wealth being an indicator of faith. The "prosperity Gospel" teachers say that if you believe faithfully then you will receive all manner of good things, which they interpret as being large lumps of money. In particular, if you give to the church (i.e., them) then you will certainly receive ten times that much back.
Yes, they are disgraceful scum. Not a very good reading of the New Testament, or the prophets of the OT either, come to that. Never heard about the "eye of the needle" story, clearly.
But that's another story.
Another flaw in the Weber thesis is evident nowadays. There's a dstinct lack of Calvinism in the highly wealthy Shintoist Japanese. The Jews in business and the professions, and in Israel, are not famous for being Protestants and the religion doesn't even teach life after death. Indians used not to care about wealth because it was all the result of previous lives. Moslems - well, if you can find a reason why Islam doesn't have a good track record in wealth creation, you're cleverer than me.
Back to the link.
The link above identifies the connection between Protestantism and prosperity, but sees the causality elsewhere. It's the focus on literacy that made the difference. Because Protestants are taught to study the Bible, they had to learn to read. So there is a correlation between literacy and wealth. (Though numeracy is probably just as important. If a worker can't count, how does he check his overtime?)
And not mentioned is another spin-off from religion. If you study the Bible and stand up for the interpretation, you develop an independent attitude. You are not subservient to another's view, and not dependent on him. This may breed an entrepreneurial attitude.
Only a theory, no evidence for it.
The above link connects to a study which queries the basis of the "Protestant ethic" explanation for wealth creationm expounded by Max Weber.
Briefly, this theory states that the teachings of Protestantism created the conditions for economic growth. Protestantism recommends that we be thrifty, careful with money, scorning adornment and superficial conspicuous consumption; that we shoudl save for the future, just as we look to the life after death.
A sub-set of the theory states that Calvinism in particular taught that only the elect go to heaven, but nobody knows who they are. Because God blesses those who believe in him, then your wealth indicates how blessed you are and is an indicator of whether you are one of the elect. So Calvinists become wealthy.
The theory isn't popular nowadays, except the bit about wealth being an indicator of faith. The "prosperity Gospel" teachers say that if you believe faithfully then you will receive all manner of good things, which they interpret as being large lumps of money. In particular, if you give to the church (i.e., them) then you will certainly receive ten times that much back.
Yes, they are disgraceful scum. Not a very good reading of the New Testament, or the prophets of the OT either, come to that. Never heard about the "eye of the needle" story, clearly.
But that's another story.
Another flaw in the Weber thesis is evident nowadays. There's a dstinct lack of Calvinism in the highly wealthy Shintoist Japanese. The Jews in business and the professions, and in Israel, are not famous for being Protestants and the religion doesn't even teach life after death. Indians used not to care about wealth because it was all the result of previous lives. Moslems - well, if you can find a reason why Islam doesn't have a good track record in wealth creation, you're cleverer than me.
Back to the link.
The link above identifies the connection between Protestantism and prosperity, but sees the causality elsewhere. It's the focus on literacy that made the difference. Because Protestants are taught to study the Bible, they had to learn to read. So there is a correlation between literacy and wealth. (Though numeracy is probably just as important. If a worker can't count, how does he check his overtime?)
And not mentioned is another spin-off from religion. If you study the Bible and stand up for the interpretation, you develop an independent attitude. You are not subservient to another's view, and not dependent on him. This may breed an entrepreneurial attitude.
Only a theory, no evidence for it.
Friday, 1 June 2007
Economic lunacy
Is the President of Iran an agent of the Mossad?
During a recent economic crisis, he telephoned from germany to give the solution to the crisis, involving inflation hitting 15%.
He ordered the banks to cut interest rates to 12%.
If that continues, there will be more inflation, a fall in the value of the currency, more expensive imports and a squeeze on living standards for the poor. Who voted for the President.
If there is an economic disaster, in a volatile country, can the nuclear programme continue?
So: is he an agent of Israel?
During a recent economic crisis, he telephoned from germany to give the solution to the crisis, involving inflation hitting 15%.
He ordered the banks to cut interest rates to 12%.
If that continues, there will be more inflation, a fall in the value of the currency, more expensive imports and a squeeze on living standards for the poor. Who voted for the President.
If there is an economic disaster, in a volatile country, can the nuclear programme continue?
So: is he an agent of Israel?
Monday, 28 May 2007
Venezuela - it's all geography
The Socialist government of Hugo Chavez has this week mpved to extend its totalitarian grip on the country. A well established TV station has been closed down, and demonstrations crushed by tanks. Curiously ignored by the media, though it's on a par with the Greek colonels coup and Pinochet's seizure of power, though not quite so savage a rperession (yet) as Castro.
The government has oil money, of course, just like Castro had money, from the Soviet Union. So Chavez will be able to continue his massive arms build-up, to feed the demand for luxuries for the ruling elite, and give the increasing numbers of urban poor a regular supply of food and possibly even health care.
But, as ever, they will undoubtedly ignore the basic fact of economics; that wealth comes from value-added, not an infusion of money. This means professional people and entrepreneurs, using a free flow of good and information brought by a free press and capitalism. So the real wealth will not materialise, and the country will decline, relatively and absolutely.
It has already begun; the proportion of poor people has already increased.
Another example of the curse of oil; no country ever became wealthy from being resource rich (OK, Australia did, but that's the Anglosphere exception.)
What's this got to do with geography? Simple, really. How easy will it be to escape from the country? Cuba is an island, it is a natural prison and has been for 50 years. North Korea is a peninsula and has tightly controlled, relatively short borders.
Venezuela has a large land border which will be very difficult to police. When the repression gets unbearable - say, in a year or two - the professional classes will be able to leave the country. They will be able to walk out, voting with their feet.
Perhaps Chavez will try to build a new Iron Curtain to keep them in. Perhaps the country will collapse because of an oil price slide deprives the population of the essentials. Perhaps he will use his Russian guns and tanks to massacre the demonstrations.
Nothing is certain. But the determining factor will be geography.
The government has oil money, of course, just like Castro had money, from the Soviet Union. So Chavez will be able to continue his massive arms build-up, to feed the demand for luxuries for the ruling elite, and give the increasing numbers of urban poor a regular supply of food and possibly even health care.
But, as ever, they will undoubtedly ignore the basic fact of economics; that wealth comes from value-added, not an infusion of money. This means professional people and entrepreneurs, using a free flow of good and information brought by a free press and capitalism. So the real wealth will not materialise, and the country will decline, relatively and absolutely.
It has already begun; the proportion of poor people has already increased.
Another example of the curse of oil; no country ever became wealthy from being resource rich (OK, Australia did, but that's the Anglosphere exception.)
What's this got to do with geography? Simple, really. How easy will it be to escape from the country? Cuba is an island, it is a natural prison and has been for 50 years. North Korea is a peninsula and has tightly controlled, relatively short borders.
Venezuela has a large land border which will be very difficult to police. When the repression gets unbearable - say, in a year or two - the professional classes will be able to leave the country. They will be able to walk out, voting with their feet.
Perhaps Chavez will try to build a new Iron Curtain to keep them in. Perhaps the country will collapse because of an oil price slide deprives the population of the essentials. Perhaps he will use his Russian guns and tanks to massacre the demonstrations.
Nothing is certain. But the determining factor will be geography.
Unintended consequences
There is yet another new scheme to help us be more what the government would like us to be: a nation of sober people. The drinks companies (most of them) have agreed to put the number of alcohol units on drinks bottles. So we'll check the content and drink less.
Hmmm. Well, apart from the obnoxious assumption that the government can legislate to make us good, this is likely to create some results not quite intended by the do-gooders who come up with these schemes. It stems from the psychology of youngsters going to pubs.
When I was a teenager, we went to the local bar and consumed Watneys Starlight beer. By the gallon. All night long.
Eventually we cottoned on to the fact that it was actually very low in alcohol content, so low it could legally be sold to children (so it was said.) We moved on to Guinness and proper beer, with a taste.
We guessed that the Starlight beer had been developed to enable teenagers to drink large quantities.
And it so happened that our idea was correct. 30 years later I happened to speak to a marketing man (not in the drinks trade) and he mentioned that he had worked on the advertising campaign for Starlight. It had, indeed, been designed as a "session drink", to be consumed in a a large quantity over a period.
The last thing Watneys would have wanted was for teenagers to realise the low alcohol content, They would have switched immediately to something stronger.
Advertising the units of alcohol in a drink won't put people off at all. It will become a badge of honour (cor, guess what I drank last night?!!)
We are indeed ruled by morons.
Hmmm. Well, apart from the obnoxious assumption that the government can legislate to make us good, this is likely to create some results not quite intended by the do-gooders who come up with these schemes. It stems from the psychology of youngsters going to pubs.
When I was a teenager, we went to the local bar and consumed Watneys Starlight beer. By the gallon. All night long.
Eventually we cottoned on to the fact that it was actually very low in alcohol content, so low it could legally be sold to children (so it was said.) We moved on to Guinness and proper beer, with a taste.
We guessed that the Starlight beer had been developed to enable teenagers to drink large quantities.
And it so happened that our idea was correct. 30 years later I happened to speak to a marketing man (not in the drinks trade) and he mentioned that he had worked on the advertising campaign for Starlight. It had, indeed, been designed as a "session drink", to be consumed in a a large quantity over a period.
The last thing Watneys would have wanted was for teenagers to realise the low alcohol content, They would have switched immediately to something stronger.
Advertising the units of alcohol in a drink won't put people off at all. It will become a badge of honour (cor, guess what I drank last night?!!)
We are indeed ruled by morons.
Thursday, 24 May 2007
Magic moments - an old woman
Many years ago, I worked for a few months in a kibbutz. After a few weeks I was sent to work in the kitchens, washing dishes. Then this happened.
I am standing at a sink, scrubbing aluminium trays and stainless steel pots. The staff are mostly older women, in aprons and headscarves.
As I work, an older woman, with lined face but with black hair, seeming older than her years, comes over to collect a new pot.
She has short sleeves; her arm as she reaches past me is tanned above, with melanomic spots, and the underside of her forearm is paler.
It is marked by an ancient tattoo, a triangle followed by six digits.
I know what it means, I have heard of this but have not seen it before.
For a frozen instant, I pause, glance and raise my eyes to hers.
She sees the direction of my gaze and knows that I recognise the mark. She gives the faintest nod and a glimpse of a grin, then carries on with her work.
I hope I conveyed sympathy. She knows I know what it means.
But I know that I cannot truly understand. For she survived Auschwitz.
I am standing at a sink, scrubbing aluminium trays and stainless steel pots. The staff are mostly older women, in aprons and headscarves.
As I work, an older woman, with lined face but with black hair, seeming older than her years, comes over to collect a new pot.
She has short sleeves; her arm as she reaches past me is tanned above, with melanomic spots, and the underside of her forearm is paler.
It is marked by an ancient tattoo, a triangle followed by six digits.
I know what it means, I have heard of this but have not seen it before.
For a frozen instant, I pause, glance and raise my eyes to hers.
She sees the direction of my gaze and knows that I recognise the mark. She gives the faintest nod and a glimpse of a grin, then carries on with her work.
I hope I conveyed sympathy. She knows I know what it means.
But I know that I cannot truly understand. For she survived Auschwitz.
Religion: a feature, not a bug
When people ask, "why did God make Man?" it is common for theologians of monotheistic faiths to reply, "So that we could worship him".
I've always found that rather an odd response. Why should we pretend to know why God does something? And why should the omnipotent creator want to create beings of limited perception just so they can worship him?
But recently I've seen the subject with other eyes. I realised that, while the deeper philosophical questions remain, there can be little doubt that we are made to worship.
Anti-religious writers try to disprove the existence of God - as does Richard Dawkins in his most recent book. (Not read it yet, but his others have been good.) Having proved to his own satisfaction that God doesn't exist, presumably he regards human outreach to God, in prayer, ritual and worship, as falsehood and fraud. Well, that's his opinion, and he is entitled to it.
Now to the title of the piece. Worship, I contend, can be shown to be such a part of human life - any time, any where, that it should be refgarded as a faeature of our make-up, not a bug in the system.
Our mind consists of hardware, firmware (that's embedded software), software, instructions and information. These approximate to our brains, our instimcts, our learned experiences, our knowledge and our environment. Religious belief can be regarded as a bug in the system, to be decoded and removed - or it can be seen to be a feature which we can't remove.
More seriously - if the capacity for religion is denied, it will emerge somehwre else, like any other repressed drive. Represss sex and it will come out as obsession or perversion. Suppress any feature and it will emerge again.
And as open religion declined in the 20th century, we have seen the emergence of false gods.
Political leaders in totalitarian societies.
Celebrity culture.
Shopping and materialism
Screen idols and pop idols (the use of the term "idol" says it all).
Obsession with sports teams, the World Cup, the Ashes cricket trophy (I plead guilty).
The list can be extended.
So, to worship is a feature of life, not a bug. Whether we believe we are made by a "blind watchmaker" in an evolutionary process, or made by a benevolent creator, or a malevolent one for that matter, it is sheer folly to deny that our make-up inclines us to worship.
Recognising that we are made that way enables us to apply ethics to the object of worship, and to our relationship to it. Denying that worship is normal means the question is not raised.
Recognising idols as false gods - as did Abraham - means we can dethrone them from our hearts and place them in proper perspective.
Maybe it is possible to do this without believing in a god or in his son, the suffering servant. But if we stand in awe and wonder at the magnificence of the world, I do find it somewhat easier to relate to it when seeing it as a creation, not an accident of nature.
I've always found that rather an odd response. Why should we pretend to know why God does something? And why should the omnipotent creator want to create beings of limited perception just so they can worship him?
But recently I've seen the subject with other eyes. I realised that, while the deeper philosophical questions remain, there can be little doubt that we are made to worship.
Anti-religious writers try to disprove the existence of God - as does Richard Dawkins in his most recent book. (Not read it yet, but his others have been good.) Having proved to his own satisfaction that God doesn't exist, presumably he regards human outreach to God, in prayer, ritual and worship, as falsehood and fraud. Well, that's his opinion, and he is entitled to it.
Now to the title of the piece. Worship, I contend, can be shown to be such a part of human life - any time, any where, that it should be refgarded as a faeature of our make-up, not a bug in the system.
Our mind consists of hardware, firmware (that's embedded software), software, instructions and information. These approximate to our brains, our instimcts, our learned experiences, our knowledge and our environment. Religious belief can be regarded as a bug in the system, to be decoded and removed - or it can be seen to be a feature which we can't remove.
More seriously - if the capacity for religion is denied, it will emerge somehwre else, like any other repressed drive. Represss sex and it will come out as obsession or perversion. Suppress any feature and it will emerge again.
And as open religion declined in the 20th century, we have seen the emergence of false gods.
Political leaders in totalitarian societies.
Celebrity culture.
Shopping and materialism
Screen idols and pop idols (the use of the term "idol" says it all).
Obsession with sports teams, the World Cup, the Ashes cricket trophy (I plead guilty).
The list can be extended.
So, to worship is a feature of life, not a bug. Whether we believe we are made by a "blind watchmaker" in an evolutionary process, or made by a benevolent creator, or a malevolent one for that matter, it is sheer folly to deny that our make-up inclines us to worship.
Recognising that we are made that way enables us to apply ethics to the object of worship, and to our relationship to it. Denying that worship is normal means the question is not raised.
Recognising idols as false gods - as did Abraham - means we can dethrone them from our hearts and place them in proper perspective.
Maybe it is possible to do this without believing in a god or in his son, the suffering servant. But if we stand in awe and wonder at the magnificence of the world, I do find it somewhat easier to relate to it when seeing it as a creation, not an accident of nature.
Friday, 18 May 2007
STUPID, STUPID, STUPID
In the little Wiltshire town of Corsham, the local council this week had its first BNP member.
There was a loud demonstration when he arrived for the first time to take his seat. Trade unionists, liberals, and other activists protested against racism.
How stupid they were.
Because he only won the seat BECAUSE NOBODY STOOD AGAINST HIM.
He was elected unopposed. All they had to do to stop him was to be involved enough in local politics to put up a candidate. But they couldn't be bothered.
As ever, the only thing required for evil to triumph is for good people to do nothing.
There was a loud demonstration when he arrived for the first time to take his seat. Trade unionists, liberals, and other activists protested against racism.
How stupid they were.
Because he only won the seat BECAUSE NOBODY STOOD AGAINST HIM.
He was elected unopposed. All they had to do to stop him was to be involved enough in local politics to put up a candidate. But they couldn't be bothered.
As ever, the only thing required for evil to triumph is for good people to do nothing.
Friday, 27 April 2007
Of the human footprint
There's much being published nowadays on the subject of the individual's footprint on the earth - that is, the amount the individual living on the earth will consume. Most recently, a TV show had a piles of all the vegetables we'll eat in our lifetime, all the cars we'll use, etc.
Image being presented: Mother Earth being looted. The BBC magazine Radio Times gave us the lesson we're supposed to take away: the earth would be better off without us.
A bit of a misanthropic tone, perhaps? And a huge value judgement, too, that the earth without reasonably intelligent life on it would be "better".
It's also one-sided. Because one could also make a show illustrating how much we all produce during a lifetime. That would show the other side of the ledger - everthing we consume has been produced by someone too - otherwise we'd never buy it. Even "free" stuff like water, has to be purified and delivered to us.
An honest review would comment that some resources are being depleted, used up. But similarly, we are also adding to a long-lasting store of knowledge, which never runs out and can be used gain and again to invent ingenious solutions to our problems.
So let's not be pessimistic, shall we?
Image being presented: Mother Earth being looted. The BBC magazine Radio Times gave us the lesson we're supposed to take away: the earth would be better off without us.
A bit of a misanthropic tone, perhaps? And a huge value judgement, too, that the earth without reasonably intelligent life on it would be "better".
It's also one-sided. Because one could also make a show illustrating how much we all produce during a lifetime. That would show the other side of the ledger - everthing we consume has been produced by someone too - otherwise we'd never buy it. Even "free" stuff like water, has to be purified and delivered to us.
An honest review would comment that some resources are being depleted, used up. But similarly, we are also adding to a long-lasting store of knowledge, which never runs out and can be used gain and again to invent ingenious solutions to our problems.
So let's not be pessimistic, shall we?
Tuesday, 24 April 2007
Capitalist rip-off
Compact fluorescent light bulbs !
Not normally associated with the above term. But there's more to the subject than just a better light bulb, which, like the proverbial improved mouse-trap, should have people queueing to buy it.
So why don't they? Several reasons:
The light is less clear, and not so good for reading.
The bulb takes a few seconds to light up with full brightness.
They are larger and less decorative for ambience.
But: they should last longer and save many times the cost during the lifetime.
And they are being recommended by teh EU, which will make them compulsory.
Now, when a good idea is made obligatory, arhter than letting the market decide, one must smell a rat.
Epecially when the product they are recommending is subject to a taxon imports. The government in Brussels wants us to buy itk, but not enough to lift the tax to make them cheap.
So why do they tax these bulbs? To keep out cheap Indian and Chinese bulbs.
Who benefits? The German company Siemens, who make them in Europe and now have a 450m market to itself.
Not normally associated with the above term. But there's more to the subject than just a better light bulb, which, like the proverbial improved mouse-trap, should have people queueing to buy it.
So why don't they? Several reasons:
The light is less clear, and not so good for reading.
The bulb takes a few seconds to light up with full brightness.
They are larger and less decorative for ambience.
But: they should last longer and save many times the cost during the lifetime.
And they are being recommended by teh EU, which will make them compulsory.
Now, when a good idea is made obligatory, arhter than letting the market decide, one must smell a rat.
Epecially when the product they are recommending is subject to a taxon imports. The government in Brussels wants us to buy itk, but not enough to lift the tax to make them cheap.
So why do they tax these bulbs? To keep out cheap Indian and Chinese bulbs.
Who benefits? The German company Siemens, who make them in Europe and now have a 450m market to itself.
Monday, 23 April 2007
England forever !
William Pitt: "I fear not for England. She will stand till the Day of Judgement".
It was St. George's Day. I celebrated by signing an online petition for an English Parliament.
Visible at: http://www.toque.co.uk/blog/archives/2007/04/vote_england_20.php
It was St. George's Day. I celebrated by signing an online petition for an English Parliament.
Visible at: http://www.toque.co.uk/blog/archives/2007/04/vote_england_20.php
Tuesday, 17 April 2007
Numberwatch
Drawing your attention to the excellent blog "Numberwatch", dediceted to the misuse of statistics and science to scare the public.
See side bar for link.
The "Number of the Month" collects the latest insanities, errors and downright lies that infest the popular press.
This month he picks apart a fancy scheme to fly wind turbines in the upper atmosphere and produce electricity that way. (Briefly, the real problem is not flying it - it's getting the electricity down the cable).
Might also be a problem with conservation of energy too - if the wind is providing enough energy to lift it, can it also be providing a surplus too?
Worth a regular look.
See side bar for link.
The "Number of the Month" collects the latest insanities, errors and downright lies that infest the popular press.
This month he picks apart a fancy scheme to fly wind turbines in the upper atmosphere and produce electricity that way. (Briefly, the real problem is not flying it - it's getting the electricity down the cable).
Might also be a problem with conservation of energy too - if the wind is providing enough energy to lift it, can it also be providing a surplus too?
Worth a regular look.
Girl in the desert
Another in my occasional series of "Magic Moments".
This happened 30 years ago, but I never forgot it and I swear it is true in every detail.
Three of us were camping in the Sinai desert, on the coast near Dahab. This was long ago before the tourists got to it. A mixed group - one German, one Dutch, one English.
We got up early in the morning to make a hike off road into the desert ravines and sandtone hills around the oasis. After several hours in the parched, rocky wilderness, we made our way back towards the coast and ended up following a small dry wadi down to the gritty, gravelly beach.
As we reached the level ground, we came across someone else by the path. A youngish woman, though it is hard to tell the age of desert dwellers, sat on the ground by a small shelter, barely more than a windbreak. A tiny fire smouldered in front of her, a few possessions lay behind her.
She paid no attention to us - these foreign interlopers into her world. She sat impassive, in her black and dark blue robes, a head covering hanging loosely round her shoulders.
We did not pause long. But it was long enough for the complete "otherness" of the Bedouin woman to penetrate. I realised, without words, that she was utterly different from us. I felt, bizarrely, that she was not human like us, but had grown there, out of the ground.
And then - I promise this is true - the following words came to me:
"For God has made of one blood all nations of men . . . for we are all children of Adam".
We passed on, back to the Bedouin village and the primitive tourist site where we stayed. We will never know why she was there, away from the others. But I never forgot it either.
This happened 30 years ago, but I never forgot it and I swear it is true in every detail.
Three of us were camping in the Sinai desert, on the coast near Dahab. This was long ago before the tourists got to it. A mixed group - one German, one Dutch, one English.
We got up early in the morning to make a hike off road into the desert ravines and sandtone hills around the oasis. After several hours in the parched, rocky wilderness, we made our way back towards the coast and ended up following a small dry wadi down to the gritty, gravelly beach.
As we reached the level ground, we came across someone else by the path. A youngish woman, though it is hard to tell the age of desert dwellers, sat on the ground by a small shelter, barely more than a windbreak. A tiny fire smouldered in front of her, a few possessions lay behind her.
She paid no attention to us - these foreign interlopers into her world. She sat impassive, in her black and dark blue robes, a head covering hanging loosely round her shoulders.
We did not pause long. But it was long enough for the complete "otherness" of the Bedouin woman to penetrate. I realised, without words, that she was utterly different from us. I felt, bizarrely, that she was not human like us, but had grown there, out of the ground.
And then - I promise this is true - the following words came to me:
"For God has made of one blood all nations of men . . . for we are all children of Adam".
We passed on, back to the Bedouin village and the primitive tourist site where we stayed. We will never know why she was there, away from the others. But I never forgot it either.
Friday, 13 April 2007
On Moses and John Newton
The brilliant site "Ship of Fools" (see sidebar) has both humourous and serious features. Today a brief one on the slave-trader John Newton, who converted, campaigned against the trade and lived to see it abolished thanks to the activities of Wilberforce. He also wrote the famous hymn, "Amazing Grace".
Nice story it is - just one teensy-bit of a problem. Read the feature.
http://ship-of-fools.com/Features/2007/john_newton.html
Newton converted during his time as a slave-trader. But he continued in the trade for six years, and only left on ground of ill-health. During the latter years he had been a "humane" slaver, who ensured very few died. Looked after them well, except that - well, they were still slaves.
This isn't to deny his role in the campaign - he wouldn't be the first to live with a dreadful system as part of the background of life. And he did eventually see the horror and turn against it.
I am reminded of the rabbinic story about Moses, based on the text "He saw their burdens" - that is, the slaves with their labour. Of course, the rabbis do not claim this happened exactly - it is a midrash, that is, it is a parable, on change in society.
The rabbis say that his first reaction was to help the person next to him.
His second reaction was to use his influence at court to lighten the tasks loaded onto the Hebrews.
The third and final reaction was - revolution, a complete overthrow and end to the slavery of his people.
So Newton had the same experience. First, he chose not to impose tortures on his slaves, then he developed a system so that his slaves survived the Middle Passage. Finally he realised that the whole system needed to be rejected utterly.
It's a timely reminder that the situations we grow up with can all too easily be seen as "inevitable" or "the way things are". And we must be ready, eventually, to change things completely if necessary.
Nice story it is - just one teensy-bit of a problem. Read the feature.
http://ship-of-fools.com/Features/2007/john_newton.html
Newton converted during his time as a slave-trader. But he continued in the trade for six years, and only left on ground of ill-health. During the latter years he had been a "humane" slaver, who ensured very few died. Looked after them well, except that - well, they were still slaves.
This isn't to deny his role in the campaign - he wouldn't be the first to live with a dreadful system as part of the background of life. And he did eventually see the horror and turn against it.
I am reminded of the rabbinic story about Moses, based on the text "He saw their burdens" - that is, the slaves with their labour. Of course, the rabbis do not claim this happened exactly - it is a midrash, that is, it is a parable, on change in society.
The rabbis say that his first reaction was to help the person next to him.
His second reaction was to use his influence at court to lighten the tasks loaded onto the Hebrews.
The third and final reaction was - revolution, a complete overthrow and end to the slavery of his people.
So Newton had the same experience. First, he chose not to impose tortures on his slaves, then he developed a system so that his slaves survived the Middle Passage. Finally he realised that the whole system needed to be rejected utterly.
It's a timely reminder that the situations we grow up with can all too easily be seen as "inevitable" or "the way things are". And we must be ready, eventually, to change things completely if necessary.
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