Skip to content

March 2011

Chuka\’s great new idea

Let\’s give Northern Rock to the depositors, why not?

Chuka,

Two things:

1) Are they going to pay for it? The \”good bank\” part of NR has a value. Why should we the taxpayers make a gift of that value to the depositors who will then own it? So, how much are they going to pay and how?

2) Building Societies are less risky are they?

Tell that to the depositors in the Derbyshire, Cheshire, Barnsley, Scarborough, Dunfermline societies.

In fact, more British Building Societies went bust than British banks went bust.

You tell \’em Lewis

The lesson to learn here is that if your country is hit by a monster earthquake and tsunami, one of the safest places to be is at the local nuclear powerplant. Other Japanese nuclear powerplants in the quake-stricken area, in fact, are sheltering homeless refugees in their buildings – which are some of the few in the region left standing at all, let alone with heating, water and other amenities.

Nothing else in the quake-stricken area has come through anything like as well as the nuclear power stations, or with so little harm to the population. All other forms of infrastructure – transport, housing, industries – have failed the people in and around them comprehensively, leading to deaths most probably in the tens of thousands. Fires, explosions and tank/pipeline ruptures all across the region will have done incalculably more environmental damage, distributed hugely greater amounts of carcinogens than Fukushima Daiichi – which has so far emitted almost nothing but radioactive steam (which becomes non-radioactive within minutes of being generated).

And yet nobody will say after this: \”don\’t build roads; don\’t build towns; don\’t build ships or chemical plants or oil refineries or railways\”. That would be ridiculous, of course, even though having all those things has actually led to terrible loss of life, destruction and pollution in the quake\’s wake.

Can a cynic ever achieve anything?

Ritchie asks or tells us perhaps:

I think Strategist is right – Worstall’s great ability is to be negative

And you have to conclude as a result with regard to all that he says “so what?” When did a cynic ever achieve a result? Or increase the sum of human well being?

He certainly never will

To which I would offer three answers.

1) Being negative about some of the damn fool things that are proposed is an addition to the sum of human well being. If there had been more negativity about the Groundnut Scheme utility would have increased. So with many of Ritchie\’s proposals.

2) I would refer to an earlier answer given here. When your work is visible from space please do come back to me.

3) I would refer you to the answer given in Pressdram v. Arkell (1971).

Adam Lent and Tony Dolphin\’s plan

Interesting way of looking at it:

If so, he would no doubt regard us as simpering cowards. We have just published an IPPR paper which argues, coincidentally, that a forecast of 1.5% growth or below is precisely the point at which the Treasury should draw back from deficit reduction to give the economy some breathing space.

Our reasoning, however, results not from want of backbone but simply because we believe that in a time of extreme uncertainty, it is vital that deficit reduction plans are as responsive as the economy is volatile. Pressing ahead with plan A when the economy is underperforming over the short term will not only compound a bad situation but is likely to make it even harder to meet important deficit reduction targets as tax revenues remain suppressed for even longer than is necessary.

So, in a time of uncertainty we will cdeal with that uncertainty by increasing the uncertainty about what the government is going to do.

Difficult to see the logic in that really.

But unlike the chancellor we believe this should be done not by setting pre-ordained annual targets for the next four or five years as outlined in the emergency budget but by committing to an average reduction in the deficit each year. So, for example, on current forecasts, an average reduction in the deficit of 1% each year would eliminate the structural deficit by 2016-17.

Eh?

Are we to ignore mathematics as well as logic now?

How in buggery would a 1% cut pa in anything at all lead to elimination of that anything in only 5 years?

Given that the structural deficit is around 5, 6% of GDP, what we\’d actually need is a 1% cut in total spending each year to eliminate the structural deficit in 5 years.

Something which is, if I\’m not mistaken, larger cuts than those currently proposed, isn\’t it?

But then Adam Lent is one of those at the TUC who works with Ritchie…..

Right and wrong

One Telegraph headline:

Tax rise looms for poor already paying higher rates than millionaires

Yes, this is correct. Another Telegraph headline

Poor families pay more tax than millionaires

No, this is not correct.

Marginal tax rates on the poor, when you combine income tax, NI and benefit withdrawal rates, are indeed higher than marginal tax rates upon the rich. Amounts of tax paid are of course not higher for the poor than the rich.

We can imagine what some people will say about this: therefore we must raise the tax rates on the rich.

Yet those marginal tax rates faced by the poor are of the order of 73%. We would definitely be well into Laffer Curve territory if we were to impose such rates on all. Indeed, while I wouldn\’t actually want to have to prove it, I\’d argue that we\’re in Laffer Curve territory with such rates upon the poor. We are managing to discourage people from taking marginal work because doing so just isn\’t worth it to them and thus tax revenues decline as a result of such high rates.

The correct answer therefore is not to start soaking everyone, but to stop soaking those poor. A very good start would be to raise the income tax and national insurance starting points to be equal to the minimum wage. Around £11,700 a year.

As both UKIP and the ASI urge: and that I am associated with both might be a clue that that joint support is not a coincidence.

Ooooh, nice try Mr. Lean, nice try

It is not alone in this, for nuclear operations around the world have poor records on public accountability. The three biggest nuclear accidents before this – Chernobyl, the 1957 Windscale Fire and a nuclear waste explosion in Chelyabinsk, Russia – were all initially kept secret.

The Chelyabinsk explosion (also known as Kyshtym and I\’ve driven through the affected area) was from the early Soviet attempts at bomb making. Similarly, Windscale was deliberately designed to maximise the plutonium produced, again for bomb making purposes.

It\’s ever so slightly naughty to point to failures of bomb making plants as failures of civilian nuclear power.

Strange information of the day

An investment manager of my aquaintance has been buying shares in the company that owns those nuclear plants in Japan.

It is, of course, a bet, even if a well informed one, that the way the media have been reporting this is overblown.

I think we\’d all rather hope that he makes a lot of money out of this, eh?

For what little it\’s worth (I have no inside information and only a smattering of detailed knowledge about nuclear power plants) I think he\’s right.

Ritchie on Timmy elsewhere

Tsk Ritchie, tsk.

You shouldn\’t be basing your arguments upon the press release. You should, as I do with your reports, actually read the report. You would, for example, find answers to the question you pose:

That’s why the UK Revenue were winning all the way through the courts was it? Because they were.

No, they weren\’t in fact. Vodafone won at the Special Commissioners, Vodafone won at the High Court and it was smoething of a draw in the Court of Appeal. I even explain why HMRC didn\’t take it to the Supremes, for fear of losing. For there are 100 other companies with very similar tax arrangements and without a clear precedent HMRC will get some money from all of them instead of the none if HMRC had lost at the supremes.

All true, of course. And all utterly misleading. First, the UK has sought to challenge settlements from husbands on wives. Worstall ignores this. They have not in this case, but the law to do so exists.

As the full report points out, from the documentation we can see there was no settlement. Tina Green owned Taveta at the time that Arcadia was purchased.

Third, the lack of transparency is an issue – we don’t know why Barclays paid so little tax.

No, actually, we do know exactly why Barclay\’s paid the amount of tax that it did. Here. (Written after I had filed my report, so not included, but well recommended).

Now Ritchie is a contributor to the site, Liberal Conspiracy and as such I\’d expect him to correct any errors. And, in fact, we see that Richard does indeed comment upon the post. Not, err, though to correct any errors.

Nowt so irrational as peeps

So, when I heard that the price of potassium iodide had soared on e-Bay as a result of idiots thinking that the light and very short lived radiation from Japan might soar over 7,000 miles of ocean and kill Californians dead in their beds, I tried to think through how I could make money out of this.

I can buy a 100 gramme bag of pharmaceutically pure potassium iodide from my local pharmacy here in Portugal for, including posting it to California, maybe $50.

There were stories of 12 tablet packs selling for $500. And, each of those 12 tablets is 130 milligrammes, meaning that my 100 g bag is equivalent to 780 doses.

Woo Hoo! $32 k for my baggie here I come!

Unfortunately, people seem to be even more irrational than I give them credit for.

They\’re still buying the tablets at exotic (even if not quite that exotic) prices, but the people selling bags of potassium iodide (there\’s one selling 100 g bags at $35) don\’t really seem to be moving the goods.

I can only assume that peeps think that the KI in the tablets is somehow different from the KI in the powder. Which isn\’t so but……

What a shocker!

THE TREASURY IS participating in the “economics of the playground” by cutting the budget of HM Revenue & Customs, the head of the tax inspector’s trade body has said.

Blimey, where do they find these stories to put into the newspapers, eh?

Trade union head says more money should be spent on trade unionists he\’s head of.

Our special feature tomorrow will investigate this damp clingy feeling that comes from immersion in water.

Ms Mirren and the building of sewers

Helen Mirren joins protest against \’super sewer\’
Helen Mirren is throwing her weight behind a campaign to save a 99-year old Thameside park from destruction.

Might I suggest a little walk along a 150 year old sewer?

You know, London\’s previous \”super sewer\”?

\"\"

Such a terrible destruction of the environment, don\’t you think?

On the understanding of economics in academia

This is rather illustrative:

While it won\’t cost more to get an Oxbridge degree, some dons have made the compelling argument that if Oxford and Cambridge are serious about increasing their traditionally poor access to students from less affluent backgrounds, they would do well to charge less than other universities.

Yes, that\’s right, our English Don is suggesting that the universities for which there is the highest demand should charge lower fees.

Someone hates Andrew Emery

That someone quite possibly being the picture editor at The Guardian.

But Nathaniel D Hale, always an immaculate figure in his suit and trademark bowler hat, had his gangsta croon all over dozens of hit records.

The picture used?

\"\"

Quite, one in which Nathaniel D Hale is wearing a trilby, not a bowler.

Something of a surprise

A decent backgrounder on the Japanese nuclear situation. And it\’s in The Guardian.

\”What happened at Chernobyl, which was a much more serious accident than this, was that the local Soviet authorities were in denial, they didn\’t get people out of the area, they didn\’t evacuate quickly enough, and they allowed children to continue to drink heavily contaminated milk, and as a consequence, many children received high doses of radiation, a sievert and greater, to the thyroid and we\’ve seen thousands of thyroid cancers as a consequence,\” Wakeford said.

\”In 1957 radioiodine was released in the Windscale fire in Cumbria . They monitored it and tipped the milk away. If they had done that at Chernobyl they could have prevented much of the problem.\”

Can we have a little reality here?

The Low Carbon Kid touts himself as the one who knows about renewables and energy.

Renewable energy is free

You what?

Given that Solar PV requires a 46 p per unit subsidy it\’s very diffiult indeed to make any sense of such a drivellingly stupid statement.

The rest of the piece is similarly filled with complete nonsense.

Surprisingly, he\’s decided not to publish my comment pointing this out…….

Thanks Guenther, you\’re being really helpful

Günther Oettinger, Europe\’s energy commissioner, said: \”There is talk of an apocalypse and I think the word is particularly well chosen. Practically everything is out of control. I cannot exclude the worst in the hours and days to come.\”

No, it\’s not a particularly well chosen word. For we\’re still, even now, at the stage where panic will do more damage than the actual problem itself.

Note who\’s talking here:

Francois Baroin, a French government spokesman, went further, saying: \”In the worst of cases, it could have an impact worse than Chernobyl.\” He added: \”They have visibly lost the essential of control.\”

Malcolm Grimston, a British nuclear expert at the Chatham House think tank, played down suggestions of an impending disaster, saying Fukushima was not like Chernobyl.

\”We\’re nearly five days after the fission process was stopped, the levels of radioactive iodine will only be about two–thirds of where they were at the start, some of the other, very short–lived, very radioactive material will be gone altogether by now,\” he said.

Earlier, Nathalie Kosciusko–Morizet, France\’s ecology minister, had said that \”the worst scenario is possible and even probable\”.

A bureaucrat and an environmentalist say it\’s terrible. An expert says, well, hang on a minute……