Elsewhere

For the early years of Amazon’s existence it was just fine with the idea – and the law – that it didn’t have to collect sales taxes. Not that it worked quite like that, but the general outcome was roughly that. As Amazon grew larger its view shifted, to where it does collect sales taxes for each state that imposes one. It’s also supported the idea that everyone else should do so as well – odd that, isn’t it?

You’ll recognise this argument from elsewhere

For, as I said earlier, a house costs in Seattle just what a house costs anywhere. It’s not even the price of land which drives it up in that locality. It’s the permission to put a house on a piece of land which does. Allow more housing on that set amount of land, and the price of each piece of housing will fall. This isn’t rocket science, just basic economics: Increase supply, and prices fall. And again, it’s permits to build which are in short supply, so issue more permits and the price will fall.

My preferred solution is to simply abolish zoning altogether. You own a piece of land? Build as you wish upon it. That would solve one of our modern world problems by having less government. Indeed, simply stop government from doing something (rationing house-building), and the price of housing will fall.

Even if that’s a bit radical for you, it is still true the Seattle City Council is causing the problem. Thus it’s one the Seattle City Council can solve entirely. Allow people to build more dense housing in Seattle, and the price of housing in Seattle will fall. That’s what they say is their goal, anyway, so why don’t they do it then?

Saying it all again

There may well be a limited number of ways to keep saying the same thing but I’ve not quite found that limit yet:

So, free trade in the G-7 is a great idea. And the benefits of trade go to the importers. So, therefore, it’s possible to gain all the benefits of that free trade even if we’re the only people in the G-7 doing it. If the U.S. is the only country that abolishes tariffs and barriers, then the U.S. is the place (more accurately, Americans are the people) benefiting from that free trade. Which means that it doesn’t matter what everyone else does. Unilateral free trade is something we can do without anyone else’s agreement and it also makes us richer. So, obviously, we should do it.

This has in fact already been tried. Friedrich Engels (Karl Marx’s buddy) noted that the Industrial Revolution hadn’t benefited the British working classes much. So much that the way in which wages didn’t rise very much for the first hundred years of that industrialization is called the “Engels Pause.” All the money went to the capitalists — the 1 percent, the landlords, the rich bastards. Then in 1846, Britain declared unilateral free trade. No tariffs, no barriers, on anything. Real wages started their rise, the working class — you, me, and Joe Sixpack today — were the people who made out like bandits from it. It’s also you, me, and Joe Sixpack that the economy ought to be run for.

Now here’s remarkable

Long piece in The Guardian about the cock ups on the new railway schedules. About which I say:

Ah, they tried to change the whole system, at once, as a central planner would, instead of a bit or organic tweaking here and there as a proper market system would.

We’re then to use the failure of that centrally planned approach, that convulse the system into the one big change, as a justification to have a centrally planned system subject to convulsive heaves into change, are we? We just can’t see the logic there ourselves.

And about which John Harris says:

To recap: new timetables were meant to be introduced as part of a big drive to improve services. But, as with Govia Thameslink in the south-east, Northern – a franchise operated by Arriva, the multinational transport giant that is a subsidiary of Germany’s state-owned Deutsche Bahn – had not trained enough drivers. At the same time, Network Rail compounded the mess by allowing electrification work to overrun. An overlooked factor in the chaos is the legacy of something that happened six years ago, when Network Rail centralised its timetabling operations in Milton Keynes, and created a system that had far too little connection with realities on the ground. Such is yet another example of one of the great ironies of recent history: that Thatcherite believers in the liberating wonders of markets have proved to be very good at creating byzantine, top-down, endlessly failing systems rather suggestive of the worst aspects of the old Soviet Union.

That we agree on the basic analysis here is fun, no? Or possibly, given that it’s us agreeing, a sign of the impending apocalypse.

Elsewhere, again

Is America an unequal country? It most certainly is, as every country is. The U.S. is rather more unequal than most rich countries, and quite a bit less unequal than poorer places like China and Brazil. But inequality is not poverty, whatever the current fashion is for describing it so. And that’s really all this U.N. report does manage to show, that the U.S. contains inequality. So what?

For if Alston, or the U.N., or the others who complain about it, really thought we all cared very much about inequality then they’d say they were talking about inequality, not poverty, wouldn’t they? The very fact that they obfuscate and use odd definitions shows that they know we don’t agree. Sure we’ll help the poor, indeed we do so, to the tune of that trillion dollars. That some have more than others isn’t something that worries us very much.

Elsewhere

It was Paul Krugman who said that productivity isn’t everything, but in the long run it’s pretty much everything. Yes, we all know, he’s a very irritating parti pris columnist at the New York Times. He’s also a Nobel Laureate economist whose expertise is trade. On this point he’s right.

Tariffs are a bad idea because they negate the very function of trade itself, protecting us from the competition that makes us richer.

On the sale of Air India

With airline valuations having corrected further, bidders need to factor in far higher levels of operational improvement to justify even a nominal bid for the asset. It’s little wonder everyone has stayed away from this flight. The all-important question now is, as Adam Smith Institute’s Tim Worstall suggested in Forbes a year ago, “If no one wants to buy Air India, should Air India exist?”

D’ye think they’ll accept a bid of 1 Rs? be possible to strip some assets, no?

Elsewhere

Global Destitution Now is arguing that none of this should happen. That the new technologies which will increase economic growth, will reduce abject poverty, be allowed into the poor countries which can make the most use of them. Instead barriers must be placed in the way of the people who know how to do these things in order that, well, in order that what? It all happens more slowly and thus people are poorer for longer?

That is what they are effectively arguing. We human beings collectively now know how to do some pretty cool things, but poor people should apparently not have access to said knowledge and techniques. We should instead have the sort of self-contained economy that made Cuba so rich. How much do you have to hate actual poor people to argue in this manner?

Elsewhere

Sure, maybe you or I or we really do want the poor to have more. That means we’ve got to tax ourselves so that we can give them more money. Messing with markets through price fixing just means there’s none for anyone, not more for the poor.

Elsewhere

It’s also something that really shouldn’t be happening. For we – and it’s us, in tech, driving it – are in the middle of a technological revolution. The two things simply aren’t consistent with each other, and one of them must be wrong.

We cannot be having lovely new ways of doing things, and also have low productivity growth and low real wage growth. It’s like saying we’re going down uply, something that only happens in Escher drawings – and economics is weird but not that weird.

Elsewhere

These caveats aside, the clear conclusion is that we’re really, really, getting our GDP numbers wrong. Or to be more precise, the numbers might be accurate, but they are a horrible guide to what we’re really trying to measure. What we want to know is ‘how rich are we? How close with popping with the pleasure of it all are we, being alive in this very digital dawn?’.

In economic terms the best we can do here is to estimate the value we get to consume. As a proxy for that – and we really must note that it’s a proxy – we measure GDP, which is value created at market prices. This is a problem when there’s no direct market value for something. As Google’s chief economist Hal Varian has said, GDP has a problem with free.

More elsewhere

The president is absolutely correct that the old location on Grosvenor Square in Mayfair was delightful, absolutely in the beating heart of London. The new one at Nine Elms is an old industrial estate on the unfashionable, southern side of the river. But that’s the entire point of the move, an odd thing for a real estate expert to miss. Buildings that people have to go to should be in cheap parts of the city, and we can leave the expensive places to the people willing to pay higher prices.

Elsewhere

Protectionists would have you believe that domestic firms would be helpless against those viciously efficient foreigners, so we must have trade barriers to stop that pressure. But it’s actually that competition from viciously efficient competitors which drives up productivity and thus increases living standards. If domestic productivity is low, or lower than foreign, that is exactly the reason not to put up protective barriers. It’s only under outside pressure that our own producers up their game.

If domestic productivity is not lower than global then of course there’s no argument at all for protection. Who needs tariffs against less efficient competitors? Reading the runes of trade correctly insists, either way and whatever the state of the domestic economy, that we don’t want to have restrictions upon the very thing which makes us richer.

Elsewhere

Applying moral philosophy to banking might not be the wisest of moves. The Marxists in the Labour Party would be insisting that the state must do it all, while the Aquinas wing of Christianity would possibly say the usurers will burn in Hell for all eternity. However, there is an interesting part of Marx that we can apply – the mode of production determines social relations. Further, that when the mode changes, so should the relations.

In other words, as TSB’s latest travails show, it might be time to put the computing industry in charge of retail banking. Or, to be less ambitious, perhaps, to actually recognise UK retail banking for what it is these days – a branch of the computing and tech industries, not something really to be run by bankers any more.

Elsewhere

The world faces one of those unfathomable mysteries. Any number of charities, campaign fronts and political groupuscules adamantly insist that corporations and the rich are dodging their rightfully due taxes. They propose measures which would lead to that cash being recovered and then comes the mystery. The money that is collected never amounts to a hill of beans compared to the original claims. How and why could that be?

One answer is that all are in this together, the politicians and even the tax collecting bureaucrats are in cahoots with the plutocrats. No, some really do make this argument. A rather more sensible revelation would be that the original claims are so vastly overblown as to be nonsense – that is why no one is ever able to collect the sort of sums alleged to be being hidden away.

The particular trigger for this musing is that Her Majesty’s Revenue and Customs (the U.K.’s version of the Inland Revenue Service) has only been able to collect, following various law and reporting changes, one third of what campaigners insisted would be forthcoming subsequent to those changes. There have been mutterings of a lack of will, insufficient taxmen and resources for them to work with and so on. Again, good sense insists that we look to a different reason. HMRC itself has always said that the tax gap – the difference between what is due and what is paid – is about one third what the campaigners themselves say it is. The gap is one third, collections are one third, really, it is not all that complex an explanation.

Elsewhere

There’s no reason at all to ban some consumer choice other than the knowledge that if it were available some would pick it. Given that this is obviously so, we liberals should be telling the progressives to go boil their heads. Really, why are you trying to ban something that people so obviously desire?

Elsewhere

Whale oil provided the lighting to read the breakthrough novel of 1870, the story of Captain Nemo in 20,000 Leagues Under The Sea. That was also the year of the foundation of Standard Oil. The result of that foundation is that we didn’t hunt the whales to extinction, but instead turned to kerosene to light the latter part of the 19th century, moving to electricity only in the 20th.

It really isn’t hyperbole to insist that John D. Rockefeller saved the whales by his making mineral oil products so much cheaper than the cetacean-derived equivalent. And that’s really all you need to know to understand Earth Day and what to do about it.

If you’re not a capitalist free-marketeer for Earth Day, then you’re not being serious about the environment, are you? And that would make Gaia sad and Mother Earth cry.

Elsewhere

But instead of solutions we know will work, MPs have offered up a reversal of our basic constitutional settlement: that what is ours is ours until and unless we’re compensated for its removal. Telling a bad landlord that he must come up to code is fine. Not allowing her to rent a house out that doesn’t meet code is also fine. Stealing the house ain’t.

We certainly have housing woes; rents are high. One answer is to have government do less by liberating the planning system. The other, apparently, is to reverse the outcome of the English Civil War so that the state once again has monarchical rights over property. How strange that it’s the House of Commons coming down on the wrong side of this.

More elsewhere

Worstall sums up the situation by saying “in mining, there are just two things: dirt and ore. Your back garden contains dirt, because it would cost more to extract the rare earths from it then you would make selling them on. The moment it costs less to extract those rare earths, that dirt becomes ore. But what have the Japanese have found? At the moment, it’s still dirt.”