Energy companies are morally wrong to increase bills by more than the wholesale cost of gas and electricity, David Cameron has suggested.
Monstrous fucking stupidity.
Does the wholesale cost make up the totality of the bill? No?
Then changes in those other costs, the not wholesale costs, would justify price changes, would they not?
Indeed, our favourite Baumol’s Cost Disease would tell us that we would actually expect those other costs to rise faster than wholesale costs. For those other costs are services (the billing, distribution, all that malarkey) rather than the manufacturing that is the actual production costs. And we all know that we expect the price of services to rise against the prices of manufactures over time.
Cameron obviously didn’t spend much time on the E in his degree. Indeed, we’d probably be better served if he’d spent the entire three years taking E.
Cameron did PPE. That doesn’t actually teach any P, P or E. It’s just a ticket into the establishment, like Classics was for the previous ruling class. Anyone actually interested in E or either P wouldn’t do PPE, any more than somebody who intends to be a physicist doesn’t do GCSE General Science. It’s sort of Film Studies for the real thickies.
Anyway, the point is to train people to be progressive administrators, and what Proggie Admins do is fuck things up, blame somebody else, and use the fuck-up as proof of the need for more progressive administration. Rinse, repeat.
I asked John Redwood on his blog once how many of his parliamentary colleagues are actually interested in economics, and his reply was a simple, dispiriting, “hardly any”. That about sums up the shower of shits “running the economy”.
” It’s sort of Film Studies for the real thickies.”
Blimey! I think you’ve just discovered negative intelligence.
What else doesn’t he do?
Lead? No, obvious since his photo op with dogs in the ice, he’s a media muppet.
Conservative? No,He was way too happy to make concessions to Libdems, in fact, way to eager to form a coalition to prevent him from any rolling back of the state.
There has been no conservative party since they failed to choose David Davis
I don’t like Cameron, but we’re kidding ourselves if we think he’s anything more than a product of his time.
We’ve reached the end of politics; it’s really just constant war with Eurasia, the odd show trial and lots of surveillance. I know it’s a cliche, but I’m staggered at how right Orwell was. We just don’t have the disappearances and torture yet.
Interesting that everyone thinks Cameron believes what he is saying. Tim has been known to call politicians liars.
Out of interest, how much does Baumol’s thingy apply to power companies? I’d have thought they were capital intensive (power stations) rather than labour intensive. Is “sending out bills” really a big overhead for them?
But rising energy prices will make the Tories unpopular, and then they may not then win the next election. And, being from a posh school and having a PPE degree, they have a natural right, indeed almost a sacred duty, to govern us.
So increasing energy prices is morally wrong.
@ Luke
How often do you build power stations? One you’ve built it, pretty well all of the non-fuel costs are keeping it running & the associated grid. You’re doing the usual white-collar thing & only seeing white-collar employment. There are other people in the economy.
Baumol’s cost disease has a well-defined mechanism, which doesn’t apply in this case. Wage inflation is currently well below wholesale energy price increases.
He got to be PM by having Gordon Brown as his opponent.
Still, he and Brown have one merit in common – neither is Blair.
interested,
“We’ve reached the end of politics;”
11% of people who want UKIP say otherwise. And if we changed our political system away from one that encouraged tactical voting for 2 parties, that would be higher.
Tim, do you seriously think UKIP are any different? And do you expect any change in the system? We’d be better off with a benign dictator or an absolute monarch; at least they don’t hide behind the veil of democracy.
Interested,
Do I think UKIP are any different? That wasn’t my point. My point was that there is a massive mainstream political consensus, with 3 homogenised parties and their various hangers-on in the legacy press who have a view of what the parameters of politics should be, and that a lot of people are voting outside of those parameters, probably to the point where the Conservatives are going to take a beating at the next election and be forced to change their politics.
As for benign dictators, trouble is, they rarely are. Even if you just look at economic growth, and ignore human rights abuses, you end up with maybe 3 or 4 in the 20th century compared to the dozens who ran their countries into the ground. Democracy, for all its faults at least prevents the crazies from getting power. I may not think much of Brown or Cameron, but at least they’re less dangerous than Prince Charles who believes in agriculture and medicine that would kill millions.
This might be High Pendantry, but I think Baumol is that services get more expensive relative to manufactures. Both can (and should in general) get cheaper over time, but the manufactures relatively more quickly.
So the energy companies should be continuing to screw down their service costs. By the usual means of frightening the workforce and fucking their suppliers over as much as possible. Their increases in costs due to increasing wholesale energy prices thus still do not need to be passed on in full to the customer because some can be absorbed by the reduced absolute (even if increased relative) cost of the service part of their costs.
UKIP will achieve nothing and if the Tories change their politics in reaction to UKIP they’ll get nowhere. The country has changed. What did you think Blair and Brown were about?
There is no politics now – there’s just degrees of socialism, and buggins turnism, and in a lazy and under-educated but over-entitled country that’s only going to end in tears.
The companies–who are up the states arse anyway–are having to increase prices to add in green taxes devised by ZaNuLab and carried out with enthusiasm by BluLabour under the direction of the Marquis de Stupid, Camoron himself. A liar, hypocrite and general sack of ordure.
By “morally wrong” Cameron means “certain to lose me the next election”.
When a politician starts bandying about words like ‘morality’ in connection with business it’s time to start counting the teaspoons.
“Tim, do you seriously think UKIP are any different?”
Alternatively “do you think seriously about UKIP” or do you think UKIP are serious? I give you Geoffrey Bloom.
“or do you think UKIP are serious? I give you Geoffrey Bloom.”
Do you seriously think anybody could be worse than what we have at the present? I give you clegg, milliband and cameron, Ill keep Bloom.