La Polla Again!

Hunh?

Holding down public sector pay rises to 2% for three years, only half next year\’s expected private sector increase, will increase inequality.

How so? As public sector pay is, on average, higher per hour than private, holding down public sector pay will reduce inequality, surely?

Private equity types laughed all the way to their merchant banks, having expected a much higher tax than 18%. They still pay less than their cleaners.

Again, hunh? The rich pay more tax than the poor. So she must mean they pay a lower rate: hmm……how many of these cleaners pay any CGT? So their rate is zero, is it not?

Al Gore and Climate Change

In defending Al Gore and his apocalyptic vision of climate change Mark Lynas makes the following statement:

Hence the need to move the debate from science and towards precaution. It is now very likely that global warming this century will present major challenges to the survival of human civilisation – and to our children\’s and grandchildren\’s lives. If we listen to the deniers, we are taking a very dangerous gamble – a bit like playing Russian roulette with five bullets and only one empty chamber. That\’s not a game I want to play with my kids.

But this is exactly the point at issue: global warming in this current century will not present major challenges to the survival of human civilisation. Thus, actions based on this premise are unwarranted.

If we are to believe the most extreme of the serious analyses (The Stern Review) then climate change will cost 20% of GDP in 2100. And that\’s throwing everything including the kitchen sink in there. And that\’s 20% off an economy that will be 3 times larger than it is now.

This isn\’t the end of civilisation, this is civilisation being not quite as good as it could be. Reactions to this situation should therefore be proportionate, not the emergency crash program which the end of civilisation might require.

Cement and CO2

I do wonder about The Guardian sometimes.

There were no climate change protesters waiting to jeer as the chief executives and other senior figures of one of the world\’s biggest industries gathered on Wednesday. Yet they represented a business that produces more than 5% of mankind\’s carbon dioxide emissions. And they were in Brussels to discuss climate change.

The summit was not called by the aviation industry – that is comparatively clean in comparison. Nor was it made up of car makers, oil companies, shipping firms or any other business that has traditionally drawn the fire of green campaigners.

These chief executives deal in a more down-to-earth commodity: cement. It is the key ingredient in concrete, and one that is rapidly emerging as a major obstacle on the world\’s path to a low-carbon economy.

Anyone who has read anything at all of the IPCC studies will know that cement is a major source of CO2. And given the way chemistry works in this universe there\’s not going to be any non-emittive process either.

Anywy, tucked away is this assertion:

The booming Chinese economy has created such a demand for building materials that cement production there last year released 540,000 tonnes of carbon dioxide – just short of Britain\’s total output from all sources.

Sorry? We\’re producing half a million tonnes? Really, that should have leapt out at the journo and the subs. Anyone writing anything at all on this subject should have an eye for at least orders of magnitude. Per capita CO2 emissions are several tonnes per person in the rich countries….so half a million tonnes must be the emissions of less that half a million people, not of 60 million.

Here\’s the Defra figures. If you download one of the spreadsheets you\’ll see that they\’ve got the digits correct…there just aren\’t enough of them. The numbers are reported in thousands of tonnes, not in tonnes.

It\’s a simple enough mistake, but it\’s still not good enough. I don\’t mind people making mistakes (I do so often enough myself) but you should at least be numerate enough to spot when numbers are out by three orders of magnitude. It\’s called knowing your subject, isn\’t it?

Things I Didn\’t Know About Greece Before I Came Here

Back in Athens, every cabbie is an ex-sailor, and he makes sure you find out all about it.

Bluematter.

There are a lot more blondes here than I expected. Strangely, it\’s one of those genetic oddities that only seems to affect the female of the species.

Looking down at Athens from the top of a hill (from St Giorgios) my first thought was that this is Los Angeles: specifically the San Fernando Valley. Swathes, mile upon mile, of indistinguishable suburbs, with mountains poking through. Bet it\’s got the same temperature inversion as well, creating and trapping the smog.

The Acropolis is really high. What in Western Europe would have been the location of the castle was here dedicated to the Temple. Says something, not sure what.

There is something truly stunning about a woman with the black, black hair here (those without the strange blondness above), the tanned, olive, skin and a pair of bright, bright, blue or green eyes peering out. A reminder of all those Vikings (ie Normans), Franks and the rest who ruled this place for a few hundred years (c.1200 to 1500).

Tony Benn on the Post Office

We are told the Post Office loses money – but so do the police, and if we are going to follow this neoliberal doctrine, what about establishing low-cost private police forces, to challenge the "police monopoly"? This is a big, big issue, and it is a test of our society as to whether we are to organise everything to make a profit, or see that needs are met.

If the Post Office is to be run on a competitive basis, it could charge pounds and not pennies to deliver in the Orkneys and Shetlands, and make those who depend on braille pay the huge charges that the heavy material would attract on a commercial basis.

Well, yes, quite.

Might be the first time I\’ve agreed with the Second Viscount Stansgate. Excellent ideas all: let\’s put them into practice, shall we?

Airport Blogging

Very strange the way these Portugees work. Most odd.

You see, they have this system whereby if you would like to smoke a cigarette while waiting for a plane, there\’s an area set aside for you to do so.

If you would prefer not to be surrounded by such noxious fumes, the rest of the airport is free of them.

Interesting idea, ain\’t it? Wonder if such choice, liberty and freedom might catch on elsewhere?

Praising Castro

There\’s a word for people like this:

Whatever one thinks of Fidel Castro, he is one of the few men who have known the glory to enter history and legend in their own lifetime. He is the last "superstar" of international politics. He belongs to the generation of mythical insurrectionists – Nelson Mandela, Ho Chi Minh, Patrice Lumumba, Amilcar Cabral, Che Guevara, Carlos Marighela, Camilo Torres, Mehdi Ben Barka – who after the second world war launched into political action with the hope of changing an unequal world. This was a generation that thought that communism promised a radiant future, and that injustice, racism and poverty could be eradicated in less than a decade.

Ah, yes, that\’s it. Idiots.

The Fucking Wankers!

Oh yes, we\’ll save those brave people who worked for us in Iraq! We won\’t let them be tortured, mained, killed, oh no, we\’ll do what every Briton would do and take responsibility for our actions.

Like buggery they will. Here\’s the Ministerial statement:

 

Written Ministerial Statement

09 October 2007

 

IRAQ: ASSISTANCE TO LOCALLY EMPLOYED STAFF

 

 

The Secretary of State for Foreign and Commonwealth Affairs (Mr. David Miliband):

On 8 August the Prime Minister announced a review of the Government’s assistance to our Locally Engaged staff in Iraq. The Defence Secretary, Home Secretary, Secretary of State for International Development, Chief Secretary to the Treasury and I have now agreed on the elements of a scheme.

Locally engaged Iraqi staff working for our armed forces and civilian missions in Iraq have made an invaluable contribution, in uniquely difficult circumstances, to the UK’s efforts to support security, stability and development in the new Iraq. We are hugely grateful to them for their contribution, which continues to be essential to the delivery of our mission in Iraq.

In recognition of that, we have decided to offer those staff, on an ex gratia basis, assistance which goes above and beyond the confines of what is lawfully or contractually required. Assistance will be based on objective criteria, taking into account determinable and relevant factors. It is offered in recognition of the service by these courageous Iraqis in direct support of HMG’s efforts to help the Iraqi Government and people build a peaceful, stable and prosperous Iraq.

The assistance announced by the Prime Minister yesterday will allow Iraqi staff, including but not limited to interpreters, currently working1 for HMG in Iraq, who have attained 12 months’ or more continuous service, to apply for a one-off package of financial assistance of between 6 and 12 months’ salary, depending on length of service, to meet the costs of relocation for themselves and their dependants in Iraq or the region, if they are made redundant or have to resign from their job because of what we judge to be exceptional circumstances. Alternatively, these staff will be able to apply for exceptional leave to enter the UK, or to avail themselves of the opportunity for resettlement in the UK through the UK’s Gateway refugee resettlement programme, provided that they meet the criteria for the programme, including that they satisfy UNHCR that they meet the criteria of the 1951 Convention and need resettlement.

In addition, interpreters/translators and other Iraqi staff serving in similarly skilled or professional roles necessitating the regular use of written or spoken English, who formerly worked for HMG in Iraq, will be able to apply for assistance for themselves and their dependants provided that they satisfactorily completed a minimum of 12 months’ service, and they were in our employ on or after 1 January 2005. Former staff meeting those criteria will be able to apply for a one-off package of financial assistance similar to that available for serving staff, or to avail themselves of the opportunity for resettlement in the UK through the Gateway programme as set out above.

This assistance will principally apply to Iraqi nationals who meet the eligibility criteria set out above, and who work, or have worked, in Iraq in the following capacities:

  • as direct employees of the UK Armed Forces or the Ministry of Defence;

  • on Letters of Appointment from the British Embassy in Baghdad or the British Embassy Offices in Basra and the Kurdistan Region;

  • as direct employees of DFID and the British Council.

In addition, we are considering what assistance may be provided to a limited number of contracted staff meeting the eligibility criteria who have worked in particularly close association with us as an integral part of HMG programmes, projects and operations in Iraq.

We will announce further details, including on how eligible staff may apply, before the end of the month.

defined as those working for our civilian missions or armed forces on or after 8 August 2007, the date on which the review of policy was announced.

1

I\’m sure that others will spot more toadlike behaviour than I have already.

1) This is limited to those who have 12 months or more continuous service. Why?

2) Note the reference to the Gateway programme. Run jointly with UNHCR. They have to convince the UNHCR that they meet the criteria of the 1951 Convention and really do need resettlement.

Guess what children? If you already meet those criteria then you\’re already allowed to come here. Or the US, Sweden and many other countries (Australia, for example). Because, if you meet those criteria you are indeed a legitimate asylum seeker and under the Convention you\’ve got to be let into the first country you ask.

The government is in fact giving the people who have and are risking their lives to work for us nothing, no rights they do not already have under international law.

How d\’ye like them apples? And from a Son of the Manse to boot.

These people make me sick.

 

 

 

 

Interesting Thought

At last Friday\’s Cato luncheon featuring Gregory Clark, Clark emphasized that settled agriculture is a much more arduous lifestyle than hunter-gathering (he said if he had to be tossed back in time prior to 1800 he would rather be placed in a hunter-gatherer society than in an agricultural one). To get the same amount of food, the civilized farmer has to work a much longer day.

When a modern factory becomes available, it\’s not such a great stretch for a farmer to adapt. But for a hunter-gatherer, the long work day and monotonous nature of labor are really alien. Thus, it was much easier for Japan or China to eventually industrialize than it has been for Australian aboriginals or for Africans.

As long as we restrict that to Africans with a hunter gatherer lifestyle (and thus not the Bantu tribes and many others who are indeed farmers) then yes, that might be part of it.

Polly on Gordo

Nice to see this out in the open at last:

Gordon Brown was challenged over and again to admit a somersault in the polls made him back off – but politics always requires economy with the truth.

So, there we have it. Politics is, by definition, shits lying to us. Thanks for that , Polly.

And Alan Greenspan, the Republican who nodded through George Bush\’s trillion-dollar tax cuts for the very rich, bequeathing ballooning public debt.

Err, you do understand the American political system, do you? The Chairman of the Federal Reserve has no power over tax rates. That\’s Congress that does that.

The deputy leadership elections did briefly throw up some passion – revulsion at excess at the top, the word "inequality" spoken out loud, debates that touched on fairness in schools admissions, faith schools and all the barriers to social mobility. That\’s what Labour is for. The Tory masterplan for cutting inheritance tax by £3.5bn while taxing non-domiciles £25,000 each has drawn a key battle line. Labour may have to give assurances that the inheritance tax threshold will never reach more than the current 6% richest, but the principle remains. It will take hard work to remind people what tax is for, why it is a public good and not a burden, how it is the agent of social justice. Those ideas have been allowed to atrophy in the last decade. Labour has redistributed more than any government to the poor, at least slowing the rate of increase in inequality – but by never framing the argument in ideological terms, a generation has never heard how inheritance tax helped shape social progress in the last 100 years.

Yes, please, let\’s do have this debate. On these terms. So, the Plain People of England, what do you actually support? Equality and social justice? Or lower taxation so that you get to do what you want with your money? Let\’s have an election on exactly those grounds. I have a feeling that, as with this very minor change to inheritance tax, the answer won\’t be to Polly\’s liking.

Why not take up Harriet Harman\’s proposal for a social justice commission to overhaul our tax system, which has become grossly unjust? The bottom 10% are taxed more than the top 10%,

Well, we could take up the proposals of those ghastly right wingers at the Adam Smith Institute and raise the personal allowance to £14 k or so. That\’ll take the poor out of income tax altogether. UKIP\’s proposals are subtly different but similar. The first thing to do about the poor is to stop taxing them so damn much.

VAT at such a high rate is deeply regressive,

Indeed it is and to reduce it we\’ll have to leave the EU. Score another one up to UKIP then.

property is taxed less than anywhere else

It is? What, with Council Tax? Some OECD numbers show that 5.4% is the average share of property taxation in the overall take, with the EU below average and the US and Japan both double that average. Unless the UK is an outlier in the EU (which it might be, can\’t find the figures) . A quick estimate though: 24 million housholds, £1 k a year each Council Tax, £24 billion. Another £20 billion in business rates and we\’ve got £44 billion. That\’s er, 8.8% (call it 9% as it is very much an estimate) . This is nearly double the OECD average, the EU average, for property taxation. This is less than anywhere else?

Today\’s comprehensive spending review can\’t camouflage the steep drop in spending in most departments.

I beg your pardon? Which departments are facing spending cuts? Slowdowns in hte rises in their budgets, yes, but actual cuts? Anyone seen any of these mythical beasts?

And finally, the truly outrageous:

The spectacle of one Tory millionaire swaying votes in a few marginals to buy the next election is all the evidence anyone needs of the democratic dysfunction of party funding and of an electoral system that hinges on 200,000 bored swing voters. Jack Straw has already led the way in supporting the alternative vote, giving voters the right to put their choices in 1, 2, 3 order, a first step towards fairer voting: it could be done for the next election. Better by far for Labour to do it before a hung parliament forces them.

We might lose power so let\’s change the electoral system.

Ho hum, a standard Polly Toynbee column then.

One real delight though. She\’s recommending lower consumption taxation, higher property and income taxation. There might be merits in such plans. But you know what she\’s actually doing?

In almost all OECD countries, over 80% of tax revenues come from three taxes: income tax, social security contributions and consumption taxes on goods and services (see Table 3 and related charts). However, the relative importance of different tax revenue sources varies widely from one country to another. For example, Australia and New Zealand do not collect social security contributions, while Denmark\’s revenue from this source is well below that in other countries. Overall, the countries of the European Union rely more on consumption taxes and social security contributions and less on income tax that the OECD average. In contrast, the United States collects a higher proportion in income taxes and property taxes but less in consumption taxes and social security contributions.

Yes, she\’s advocating that we move away from the European system of taxation to the American one. I wonder if she actually realises that?

Oh Dear George

On Sunday I visited the only biosphere reserve in Wales: the Dyfi estuary. As is usual at weekends, several hundred people had come to enjoy its beauty and tranquillity and, as is usual, two or three people on jet skis were spoiling it for everyone else. Most economists will tell us that human welfare is best served by multiplying the number of jet skis. If there are two in the estuary today, there should be four there by this time next year and eight the year after. Because the estuary\’s beauty and tranquillity don\’t figure in the national accounts (no one pays to watch the sunset) and because the sale and use of jet skis does, this is deemed an improvement in human welfare.

Err, no. Most economists would say that the sale of jet skis indicates a rise in GDP and would then, if you\’d just sit still for long enough to understand what they\’re trying to tell you, point out that the noise is what is known as a negative externality. That this is one reason why GDP isn\’t actually the be all and end all of the system and certainly, that a rise in GDP can accompany a decline in human welfare due to those very same externalities.

This sort of stuff is covered in A Level economics, even the new simple version for today\’s state educated. Might be worth buying one of the textbooks perhaps.

For he more advanced, a huge chunk of economics over the past few decades has been devoted to exactly this matter: the difference between economic growth and growth in human welfare. The two are not synonymous and the interesting questions are about when they diverge and what we do about it when they do.

Where economists do divide on such matters is what to do about the situation. Some would advocate taxing the jet skiers (Pigou taxation). Another idea (one I would support myself) is that the reserve should be private property and the owner charge people for watching the sunset, and for riding jet skis. A profit maximising owner would then balance the higher fees willing to be paid by the small number of skiers against the larger number of people and their smaller fee for going "Ahhh!" at the setting sun. We would thus find out who vaued the resource more, by what people are willing to pay, and in that process of discovery we would also find our solution: that scarce resource would be being used for its most highly valued use.

The massive improvements in human welfare – better housing, better nutrition, better sanitation and better medicine – over the past 200 years are the result of economic growth and the learning, spending, innovation and political empowerment it has permitted. But at what point should it stop? In other words, at what point do governments decide that the marginal costs of further growth exceed the marginal benefits? Most of them have no answer to this question.

Because it\’s not actually a question that governments should be asking. We don\’t hire our governors to decide such things for us., We hire them to do only those things that must be done collectively and with the monopoly of violence and impulsion that the State possesses. Whether there should be economic growth or not (which at heart is the question of whether there should be technological advance or not) is not one of those things for the State to decide.

Is it not time to recognise that we have reached the promised land, and should seek to stay there? Why would we want to leave this place in order to explore the blackened wastes of consumer frenzy followed by ecological collapse? Surely the rational policy for the governments of the rich world is now to keep growth rates as close to zero as possible?

It would appear that George hasn\’t actually read his own beloved IPCC reports. Specifically, the SRES.

In the A1 scenario family, demographic and economic trends are closely linked, as affluence is correlated with long life and small families (low mortality and low fertility). Global population grows to some nine billion by 2050 and declines to about seven billion by 2100. Average age increases, with the needs of retired people met mainly through their accumulated savings in private pension systems.

The global economy expands at an average annual rate of about 3% to 2100, reaching around US$550 trillion (all dollar amounts herein are expressed in 1990 dollars, unless stated otherwise). This is approximately the same as average global growth since 1850, although the conditions that lead to this global growth in productivity and per capita incomes in the scenario are unparalleled in history. Global average income per capita reaches about US$21,000 by 2050. While the high average level of income per capita contributes to a great improvement in the overall health and social conditions of the majority of people, this world is not necessarily devoid of problems. In particular, many communities could face some of the problems of social exclusion encountered in the wealthiest countries during the 20 th century, and in many places income growth could produce increased pressure on the global commons.

Energy and mineral resources are abundant in this scenario family because of rapid technical progress, which both reduces the resources needed to produce a given level of output and increases the economically recoverable reserves. Final energy intensity (energy use per unit of GDP) decreases at an average annual rate of 1.3%. Environmental amenities are valued and rapid technological progress "frees" natural resources currently devoted to provision of human needs for other purposes. The concept of environmental quality changes in this storyline from the current emphasis on "conservation" of nature to active "management" of natural and environmental services, which increases ecologic resilience.

So, to achieve lower population, we need higher growth. To get lower carbon intensity, we need high growth. To pay for the tranistion to a low carbon economy we need high growth (it\’s one ofthose things they discuss, that to get rapid technological turnover you need high growth).

Of course, George says that to get these things we should have no growth. Lucky he\’s so well read, isn\’t it?

Can They Do This?

I would be surprised if they could:

Romania is to limit the right of young doctors to work abroad after government figures showed that almost half were leaving in search of better paid jobs, causing serious staff shortages, Eugen Nicolaescu, the Health Minister, said.

I get the point of what they\’re trying to do: after you\’ve paid to train someone you\’d like them to stick around. But freedom of movement within the EU means just that, doesn\’t it? Not just entry into another country, but the right to leave one?