Fourth, neoliberalism denied complexity. It insisted that markets could solve problems that are, in reality, social, political and ecological.
Markets do solve some problems that are social, political and or ecological in origin. They also don;t solve some other problems from those sources and some others from opther sources. The trick is in knowing which is which, a problem markets can deal with or one they cannot.
Take, say, the ecological problem of climate change. Stick up the tax on petrol so people use less of it. A market solution – even if only in part – to an ecological problem.
It’s not whether, it’s when.
If neoliberalism has contributed to the failure of the Enlightenment, then the task is not to abandon the Enlightenment. It is to recover it and develop it.
That means, first, restoring the role of evidence in public decision-making.
Doesn’t that just screw Spud’s suggestions then?
Climate change is not an ‘ecological problem’. Even if it was, taxing petrol would not solve it, even in part. Taxing petrol is a government solution to a government problem ie lack of cash to spaff.
Indeed. To be a solution to an ecological problem the tax would have to be set at rate would reduce fuel use to the level would solve the problem. However, in practice it’s set at a level government thinks it can screw out of the users without ruining its electoral prospects. Thus there is no connection between the tax & the problem. They’d still tax if there wasn’t the problem.
I’m betting on policy based evidence making.
“Policy based evidence making” is Spud’s speciality.
More like delusion-based wild assertions.
It generally needs someone brighter than Murphy to do policy-based evidence making.
That’s just brute social engineering via tax, and calling that a market solution is really not an idea you should be putting in the spud head.
Yer “carbon tax at source and then let markets sort out efficiencies” could be described as a partial market solution, but only if you can stop the twats interfering elsewhere. Which, news flash, you can’t. Because they’re not trying to solve climate change; they’re trying to (dis)solve freedom.
What the market solution to the problem that unfettered free trade results in some countries [cough]the UK[cough] losing the ability to make the necessities of life (having specialised in producing the non-essentials), a situation that comes back to bite them in the arse when there’s a crisis that means the essentials are in short supply, and no-one else has the money to spend on fripperies? In short if your country specialises in high end services and non-essential manufactures, how do you feed yourselves when all of a sudden no-one needs those products and services? Whats the market solution that that?
I asked this question before and you steadfastly refused to answer.
“In short if your country specialises in high end services and non-essential manufactures, how do you feed yourselves when all of a sudden no-one needs those products and services? Whats the market solution that that?”
How much of our manufacturing is “non-essential”? There’s luxury clothing like Church’s brogues, but what else? A lot of what we make isn’t non-essential, it’s specialised. Jet engines, parking meters, specialist medical equipment. Do you think the world is cutting back on services like clinical trials, chip design, video games?
Britain simply can’t run on “necessities of life” without being a lot poorer. What tariff do you want to put on socks from Bangladesh to make British socks affordable? Or tariffs on nectarines so that we grow them cheaper in greenhouses here?
Yeah, but the thing about comparative advantage and international trade is that it depends on people not behaving like cunts. Which they often do, as we see. So whereas we’d certainly like the wealth-bringing economic efficiency we also have to wonder whether some deluded twats will simply decide to try to bring about the End Of Days, or close a choke point, or try to hollow us out with mercantilism, or squeeze our bollocks with a cartel, or entrap us with transnational regulation and “international law”.
Because people can be cunts for all sorts of reasons.
What happens if we’re producing more of our own fruit and veg, and someone does a Straits of Hormuz? Producing that fruit and veg here requires more greenhouses which need energy. What happens if we make our own nuts and bolts and don’t have energy?
Our industry is relatively low carbon per £ of profit. That wasn’t deliberate. It was where we were competitive. We just aren’t competitive at mass production. Rates of pay, sea border and all that. Stuff where human value is added.
To make a parking meter, you need about £150 of parts from Asia. You assemble them like lego and sell them for about £3000. Then there’s project management costs and annual support. Nearly all the energy is human energy. People to make them, people to do engineering and software, to test them. What ARM do is about the same. Or the people in Edinburgh selling millions of copies of Grand Theft Auto.
We just aren’t competitive at mass production.
Perhaps we could be again – if we had cheap energy and used robotics, 3D-printing, AI etc
This started long before we had an energy problem. It goes back to the 1980s, and everyone complaining about Mrs Thatch destroying manufacturing (not true, just happened to be PM at the time).
We’re an island off mainland Europe. If you’re making basic shit and trying to sell to Germans, someone in France or Poland can sell basic shit for less because they don’t have the distance, the cost of shipping over the channel. Maybe lower labour rates. You want to have a meeting with a client in Liege, that costs a lot more from Birmingham than it does from Amiens.
So how do you compete? You don’t compete on basic shit, you compete on specialised things. Things where the shipping cost is bugger all of the total value or where the value is intellectual as much as physical. What does it cost to ship a £1000 pair of brogues to Shanghai? Probably a couple of quid.
A parking meter costs a fair few quid to ship but there’s a lot of revenue and value that isn’t about the box. You don’t just buy a parking meter off the shelf. You say what space you have, and the supplier figures out what to supply. The software and machine may be customised. That requires specialists in parking meters, in C++ programming and optimising for solar power. It all adds value that is mostly done without transport, over the phone, by email. Then once installed, there’s ongoing support. I’ve upgraded parking meters in New Jersey from a factory here. A lot of manufacturing in the UK has a large amount of customisation and support to it.
It’s also why we export more outside the EU than most EU countries. And this is true since 2007. When you make digital things, or high value, non-perishable things, proximity doesn’t matter that much. You’ll pay to ship brogues, specialist optics, Lagavulin 16, game show formats anywhere in the world.
Ireland now has a similar thing going on. Less than 50% of its exports are to the EU. Where Germany is 66%, Netherlands is 70%.
It’s not about robotics, 3D printing or CNC machining because if you can figure out how to do it here, why not do it where the customers are? Put a 3D printer near them, save on the hassle of shipping. At which point, where’s the value? The making with a robot, or the software for the robot? ARM make their money not from physically making chips or even designing chips, but designing the cores of chips. That’s the high value superbrain stuff and it requires little physical movement. Out goes a file from Cambridge to California or Korea.
Being an island off the east coast of Asia did not prevent Japan exporting TVs, cars, watches, motorcycles etc to Europe. Being on the east coast of Asia doesn’t stop Korea exporting washing machines, dishwashers, fridges, and other “basic shit” to the UK. So, in theory, the UK could be a major exporter again – though if and only if it had low energy prices, low taxation, automation and robotics instead of humans, adequate infrastructure, more engineers, excellent quality control etc. Comparative advantages are not fixed…
The UK’s loss of “basic shit” manufacturing was not inevitable. The causes include: complacency resulting from previously having an imperial market, post WW2 socialism, communist trade unions, poor management, low investment…
Good points. The UK was definitely complacent in the post-imperial era. A mate of mine who is a bit older was telling me how much better the Japanese motorbikes were than British ones at a higher price.
But are we going to be able to compete with China making things, even at the same energy costs, when labour is considerably cheaper there?
By cutting human labour to the minimum with automation and robotics + low energy costs? It is unlikely to happen, but it is not impossible…
And China? Average manufacturing wages in Indonesia are $300 pcm, whereas Chinese manufacturing labour costs are $600–$1,000+ pcm…
What are all those parking meter assembly workers and GTA coders going to eat when there’s no food in the UK due to the inability of us to either import it or produce enough ourselves? Fresh air? Virtual food?
The UK could be (at a stretch) food self-sufficient; but it would not be worth the costs – ie opportunity costs, higher food prices, reduced choice, etc.
In the unlikely event that our international food supply collapsed completely rather than partially, there would be riots and looting but the population would probably soon adjust to making-do, catching fish and rabbits, growing what they could…and getting thinner. Recent immigrants might resort to eating pets and even cannibalism. Longer term, there’d be mass emigration…
Indeed. Cotton socks in M&S (made Somewhere in Asia): £2 a pair. British made socks: £20 a pair.
Most of our manufacturing is non essential. Or has been reduced so much that we only produce a fraction of what is needed. By the simple clue that went we can’t get imports everything grinds to a halt. Back during the Ukraine crisis you couldn’t get Ad Blue for love nor money, so lorries and tractors were off the road waiting for it. AD Blue was made in abroad of course. Tractors, there’s another – only JCB and Ford New Holland make them here now, and thats largely assembling imported parts. No tractors, no food. Lorries – only Leyland DAF is left, rest all imported, plus all their spares of course. No lorries, no food in the shops. You name it, basic stuff that feeds people, shifts stuff about, puts energy in our houses, all made abroad.
When there’s a crisis people don’t need Burberry handbags, or parking meters, or F1 cars. They need food, energy and transport. And our ability to make those has been degraded to such an extent we are utterly naked in front of our enemies (of whom there are plenty). Even our trains are made abroad (yes some are assembled here, but using foreign parts, so if you can’t get them, no trains either). You’re a Swindon man, the old railway works in Swindon used to be able to take in raw materials and turn out virtually anything from it. Obviously steam engines back in the day, or diesels later on, or carriages, or trucks. Thats true wealth. No putting together parts made somewhere else. Making stuff from raw materials, from scratch. All long gone of course, like the wealth of the UK.
So what’s your plan? Have lots of tomatoes grown in greenhouses, requiring lots of energy to help them to ripen? More of a turnip diet? The price of food rising because we now have to have British tractors? What’s the cost?
We actually need new trains about as much as we need Burberry handbags, less than parking meters. Half the network loses money and that gives us plenty of spare trains for what we need. We managed without people using them for months, remember?
…so lorries and tractors were off the road waiting for…AD Blue [is] made in abroad of course. Tractors…only JCB and Ford New Holland make them here now, and thats largely assembling imported parts…Lorries – only Leyland DAF is left, rest all imported, plus all their spares…
The sourcing of vital mechanical parts and crucial substances like Ad Blue need to be addressed in a national resilience plan – eg minimal stockpiles and local production plans. Lefty internationalists and righty globalists tend to under-estimate the self-interest of other nations and their hostility to the UK. And, btw, motor manufacturing globally tends to source parts internationally.
Would I trust that Shabana Mahmood is doing random visits to National Resilience Plan warehouses, making sure it’s all in order and dropping bureaucrats in a tank filled with sharks if they’ve failed?
Stuff will not get done, no-one will be fired, let alone get the Spectre treatment. There will be a judge doing a tame and wasteful government enquiry.
I’d rather try and do my own resilience.
WB provides you with part of the answer. Another part is – as Adam Smith (pbuh) recommended – to avoid unilateral free trade with mercantilist states.
…and your shipping having to pass through choke points controlled by unfriendlies, and much of your fuel coming from other unfriendlies, whether camel riders or Eurocrats.
“Another part is – as Adam Smith (pbuh) recommended – to avoid unilateral free trade with mercantilist states.”
Ah, but that runs contrary to the current ‘free markets’ credo (as espoused by our host), which is ‘Buy your sh*t wherever its cheapest’. Which is why we are now reliant on a Communist dictatorship for our solar panels for example. If certain countries are going to be off limits for ‘free trade’ then who gets to decide which ones are and when a country crosses the line, or a prodigal can return to the fold? Its all back to politics, not economics. Its certainly not free trade any more anyway, if there’s a list of countries you can’t trade with.
So Adam Smith wasn’t a free trader? Smith’s point is that free trade admits of degree. Some products of some countries – when those countries are mercantilist or protectionist – would face tariff barriers. Nevertheless, the more genuinely free trade we have, the better for all concerned.
If we had that Adam Smith version of ‘free trade’ then we wouldn’t have any imports from China would we? For that matter we wouldn’t have any trade with the EU either because it puts up trade barriers to our exports. I’d be quite happy with that version of free trade. Do you have any barriers to our exports? No, then great we’ll have no barriers to your exports. If you do have barriers to our exports then f*ck off, nothing you produce can come to us. That would be free trade. Just unilaterally saying ‘We’ll take any old sh*t from any old country regardless of how they treat us’ is akin to unilateral disarmament – going to end badly.
The UK mutual free trade agreements covering many categories of goods and services with over 70 countries and territories, plus the EU.
‘Climate change’ is the product of public decision making.
What’s the track record of Fat Controllers in solving complex problems? Does this count as evidence?
Or of communism in general.
I mean let’s not forget we’ve had quite a few empiric experiments pitting markets vs. commies and one side won every time
From your perspective. Commies don’t care if everyone dies.
The Right: One hundred and fifty million people died under 20th century communism.
The Left: So?
…
It? Reification.
Markets are people trading goods and services. They have no flicking duty to solve problems. Commie dick Murphy invents a new requirement.
Let’s also remember that problems are never solved, merely transformed and displaced.
And that markets operate within whatever constraints are imposed whether you like it or not. They are as universal as gravity and as implacable.
Yes. We can admire Spud’s honesty. He cites alleged problems are not fixed by ‘neoliberalism’ (sic). He never claims his communism will fix them either. He expects the reader to infer it.
It’s a false dichotomy setup. Neoliberalism doesn’t word, therefore, you must pick communism.
Enlightenment? From Spud?!!!
The whole *point* of the old Enlightenment movement was to look past religious and social Dogma.
What Spud spouts is nothing *but* Dogma…
In the same period he’d have been one of the proponents of the countermovement: Puritanism.
Oh wait… He still *is* ….
Candidly, the Nobel prize winning economist and legendary scholar Milton Friedman was a dummy who hadn’t considered complexity or public choice theory. Complexity is why difficult public choice decisions involving important, intersecting questions of science, finance, engineering and social development should all be made at the whim of a toadish retired accountant from Wandsworth who doesn’t even own a boat. Plus other weirdo grifters who also don’t actually know anything such as Zack Polanski (if he’ll do the needful with the peerage).
Candidly and in all candorous candidlyness, only 100% immediately disastrous and incompetent rule by dictatorship of the proseccotariat instead of the 80% we have now will be acceptable to the glorious, 1000 Year Twat Reich. Those neoliberals don’t even have an intellectual framework to explain MMT (the economics of wishing prosperity into being, much as children create free wealth and inject it into the wider economy with the money from the Tooth Fairy.). Fascist fools!
Gamecock is glad he wasn’t named “Milton.”
Still waiting for Tim to enlighten us as to the True Believerâ„¢ version of free markets that solves the little problem of a country becoming entirely dependent on imports for its necessities, supplies of which then dry up in a crisis………………..whats the free market solution to 70m mouths to feed and only 5 loaves and 2 fishes to go around?
I’m guessing its that we have an auction for the available food, which sets a high price, which of course is a market signal to produce some more. And everyone sits around until a year later when the extra food has grown……
The answer is, as with everything, swings and roundabouts.
The UK will not provide, from its land area, a modern, varied and full diet for 70 million. We can indeed do the Monbiot and all eat veggie. Or, we can trade for the foods of the world and have pineapple with our pork and on and on.
OK, so what next? Do we all eat like medieaval peasants in order to be secure? A security that – like that of medieaval peasants – only lasts until the next blight or pestilence that leaves us having to import food. Which we can’t because no one is growing that excess for us as we’ve not been buying it for years. Or, do we have that higher standard of living, better diet, by buying from the world at that risk of disruption?
That is the choice, right? I’m not misrepresenting you or anything?
OK. So, who gets to make that choice for 70 million people. You? Me? You a farmer, me an ideologue. Spud? Zack?
TBH the only people I can think of as being qualified to make that choice are the people themselves. Which does mean everyone getting to do their own thing – free markets. Which, well, that’s free trade, innit?
“We can indeed do the Monbiot and all eat veggie”
Could we just set up a Soylent Green plant next to the Guardian offices in London? 😉
No we cannot produce enough food by going vegetarian – the total croppable area is only 36% of utilised agricultural land (I was trying to look up “arable land” but DEFRA has changed its definitions). Going veggie will mean we produce less food – a lot less. No beef or lamb or pork or chicken, no milk or cheese. We cannot grow wheat on moorland pasture or water meadows.
Monbiot is either stupid or a liar (or both).
“TBH the only people I can think of as being qualified to make that choice are the people themselves. “
Well thats a crock of sh*t. Do you think the average person gives a damn about the future and what might happen? No, they just want the cheapest sh*t right now today, because their paycheck (or welfare payment) is dwindling and they need food or electric or whatever immediately. No-one is going to give a thought to what could happen. Heck most people don’t know where food comes from, other than Tesco, let alone the idea that one day food might be in short supply and at that point it might be sensible to have a domestic production base that can at least keep everyone fed.
” So, who gets to make that choice for 70 million people.”
Their leaders of course. They are supposed to be the ones who look ahead, make long term plans, use some wisdom. These days its elected politicians, in the old days it was the king or tribe leader. Its been going on for millennia, the ancients didn’t survive by just stuffing themselves in the summer and then wondering what to eat in winter. They made long term plans, saved food for winter etc etc. Thats what leaders are supposed to do. Left to their own devices a dispersed rabble will make short term decisions and result in their own demise. Thats all giving the masses the power to decide the long term direction of their nation will do – drive it into the wall eventually. All planning is about deferring gratification – have less today, because you might need it tomorrow. Your version of free marketeering is ‘Have it all today, and f*ck tomorrow’.
And in modern complex urban societies there are far far more things that need long term planning than can be arranged by just letting people do whatever they like, that is if you don’t want civilisation as we know it to descend into anarchy. Why do we have laws and regulations at all? Hey, let people build blocks of flats out of whatever they like, and however they like. Or bridges, or cars, or airplanes. Got to have that free market, right? So what if people get killed all the time by planes crashing because of faulty materials? Don’t they know they are enjoying a free market as they plummet to their deaths???
A free market price is not the true price, because it only takes into account the information that is immediately available. More grain than current demand = low price. Less grain than demand = high price. The fact that some unforeseen event might mean there is no grain at all in 5 years time doesn’t impact todays price. A wise person knows that unforeseen events happen all the time, history tells us so, and plans for them. But the market never plans for them. It just pretends everything will be hunky dorky ’til kingdom come. And when its pretending that about things that a civilisation need to survive its a stupid way to organise the affairs of hundreds of millions of people.
Actually a free market allows someone to make a bet on when the next windstorm-ravaged harvest will occur and copy Joseph by building (or in the modern world renting) storehouses for grain that he/she can sell at a profit when that happens.
Except that in a democracy that would not be allowed. It would not be considered acceptable for a small number of people to profit while others starved. The State would expropriate the food and allocate it how it saw fit.
This is a discussion that farmers have been having for some time now, about whether we would actually be allowed to make huge profits if food was in short supply and we controlled the supply of it in the UK. And the general consensus is that we would not. If the SHTF and food was literally gold dust, then farming would be nationalised in an instance. Like it was in WW2. Prices would be controlled, production directed by the State, all sales done through State controlled entities to limit the producers profit.
So no there would be no free market in those circumstances. The State would take over, at the demand of the public.
“Do we all eat like mediaeval peasants in order to be secure? “
Don’t be facetious. UK food self sufficiency was 80% in 1984, its very peak. I didn’t notice anyone living like mediaeval peasants as a teenager back then.
Maldives seem to be doing fine.
The Vatican, too, plus it has to import all its people. Not a lot of (official) breeding going on there.
True. I Wikied fertility rates by country, and the Vatican is right at the bottom at 0.00 births per woman. https://en.wikipedia.org/wiki/List_of_countries_by_total_fertility_rate
It’s heart-warmingly sweet to see Tim and Spud kiss and make up. Their takes on climate change differ only in small details.