This scarcity is apparent in several ways, with issues related to environmental projects being particularly notable. Good managers capable of thinking up such schemes are in incredibly short supply, and whilst schemes that are themselves environmentally essential can be identified, working out how to monetise them is hard at a microeconomic level, so they do not happen.
Dickie sees there’s plenty of cash. But it’s not being invested in greenie stuff. Because whatever the benefits to society of greenie stuff – to use his stance here – it’s v difficult for an investor to make money.
OK.
That means, as I’ve been saying these decades, that his ideas of how to force more money into such investments don’t work. What’s required is the work to make such investments profitable to investors and the money – which is, as he says, out there – will naturally follow.
Make being greenie profitable and it’ll happen.
That within his own envelope of thinking of course. My own is that we should be as green as is profitable but that’s a different thing.
Make being greenie profitable and it’ll happen.
Oh, there’s plenty of that. Ask that nice Mr. Vince. He profits handsomely, just not in the usual way that profitability is understood.
Perhaps therefore we should get rid of those that are manifestly incapable and use the money saved or is that ‘neoliberal’ thinking??
“Good managers capable of thinking up such schemes are in incredibly short supply ..”
He thinks there’s a shortage of Fat Controllers.
There doesn’t seem to be any shortage of people thinking up environmental schemes. One can usually come across several a day. But they rarely get past the thinking stage. They’re mostly totally impractical, would cost a lot to implement & would produce few gains.
There’s always that difference between amateur and expert. Lots of amateurs think a thing is possible/easy/good but don’t know all the details that screw it up. They typically go for something obvious and blunt, like more trains or more solar.
But lots of people in industries think of ways to save cost that you wouldn’t think of unless you were inside of it.
To be fair Martin, one of his (inadvertently) truer statements. Mostly, it’s not a thing managers are supposed to be doing. But Murph has very little business experience I think? So he probably doesn’t know that.
An almost completely unrelated anecdote from a prior job… we were doing some rail work, part of which involved upgrades in the main control rooms for regional rail. The blokes who got jobs there were (rightly so) senior, experienced drivers. Who had been eating meat pies and chips for 30 years or so while sitting on their arse in a train for hours. They were all huge. There must have been a minimum weight limit of 150kgs.
We did in fact refer to them as the Fat Controllers. Even in their office. “Can we turn this off?” I would say to the supervisor. “Hang on, I’ll go and check with the Fat Controllers”.
“. . . therefore, government must take over the means of production.”
“My own is that we should be as green as is profitable but that’s a different thing.”
Other than a bit of Pigou, the two things go hand in hand. Most wine shipped to the UK comes in giant plastic bags in shipping containers. Somewhere here, it gets bottled. Aldi aren’t doing that to be nice and green, but because it’s more efficient to move wine from Provence without the bottles. More wine per truck, so less energy, less human cost.
The most energy efficient form of transport in the UK is coach travel. National Express, Flix etc. Because they’re greed pig capitalists. If they can’t get enough people to ride a coach to make money, the route gets cancelled. So coaches generally have 20+ passengers which adds up. Trains are less efficient because of the loss making routes carrying almost no-one (£12bn/year).
Isn’t all this what we used to call “thrift”? Minimise resource usage by minimising costs and outgoings? Doing without stuff that you might like or want but don’t need? Allied with “do as you would be done by” and “don’t shit on your own doorstep”, this seems to cover most things.
Aye, but thrift isn’t a status symbol.
(at least, it isn’t for the middle classes; you need to be at least an Earl with thousands of ancestral acres to really pull off the “last bought a new coat in 1936” look)
The memorable quote is that someone mistook the then Duke of Devonshire (I am guessing the Tenth) for his gardener …
In the middle classes thrift is deemed a virtue but not a status symbol. Apart from anything else I find it difficult to visualise how one would display thrift (the result of thrift is normally invisible). Among the “nouveau riche” extravagant displays of wealth may be a feature of “one-upmanship”.
Managers don’t think up schemes.
Entrepreneurs and innovators think up schemes.
Some of them are even viable.
Managers implement them.
BS. I created many schemes when I was a manager.
These days you can get called an “intrapreneur” for applying a bit of creativity to management. Hope it got you a pay rise or bonus even if it didn’t festoon you with a fancy title.
An investment isn’t an investment unless you can get out of it with a tangible ( and mostly monetary) return. Spending money on things which can’t meet that criterion is waste or boondoggle or both.
ISTM that poor people spend most of their waking hours making and getting life’s basics. Capital and technological advance has automated away mass-labour heavy industry, so as we get richer there is less need and are fewer jobs for manual labour doing basics (except for arse-wiping and Deliveroo).
So what do people do for work? They produce more nice-to-haves rather than must-haves. AI accelerates this trend, along with narrowing the range of nice-to-have production that requires people. Media production? AI does that now.
The problem with affluence is that it breeds idleness.
What’s considered “essential” in life moves along too though. Knew someone who washed all clothes by hand and used an old fashioned mantle up to the 1990s and that would all belong in a museum reenactment now. Outside toilets, the tin bath, no flowing hot water… not the done thing anymore, at least in the West. How many people aged 18-50 don’t have some kind of phone / computer / tablet and never use the Internet? Not all of whom would count as “affluent” by any means.
But then the typical Brit in 1900 had better access to shelter (even if the housing was cramped it was a far cry from a peasant’s hut) and a wider range of consumer goods than basically any substantial population in the history of the world up to that time. You might even be able to scratch out 1900 and replace that by 1750 and still call that a form of “affluence”.
The work’s still out there. Changed a lot though. Less physical, increasingly sedentary. Not what our bodies are built to do, probably a good deal less “natural” and healthy for us. And a lot of people report being bored out of their skulls at work. Don’t know if that’s affuence making us all lazier or just that the work is no longer such a good fit for us either physically or mentally. Affluence certainly means you can afford to be lazier though, compared to the lean and hungry times.
“Old fashioned mantle” should be “mangle”. The technology is now so old that autocorrect replaces it 🙂
And a lot of people report being bored out of their skulls at work. Don’t know if that’s affuence making us all lazier or just that the work is no longer such a good fit for us either physically or mentally.
Jobs are far easier now. When I started work in the City, the work load one was expected to cope with was far above what anyone experiences these day. One didn’t complain, one just coped..Same with manual jobs in industry. Nobody had time to get bored.
“Life’s basics”. What savages in the Andaman Islands or the Amazon live on. In the modern world, the Amish. The stuff you need to stay alive after a massive solar storm has taken out the Internet. Pre-medieval self-sufficiency. Nasty, brutish and short.
Generating this stuff (and maintenance) takes up most waking hours. In affluent societies, relatively few people spend much time at all doing it. They’re all doing something else. As automation takes care of more and more mass production, in a market economy those “something elses” multiply, producing the uncountable range of goods and services now on offer for us to spend our disposable income and free time on.
Problem is, as I see it, when you look at most of those something elses, especially those which are nice for the person to do, most of the time I think to myself: “I can do without that, and will if money’s tight.”
A huge amount of the cost of expensive products is now “brand”. Take 3 shirts. A basic one from Asda. About £15. A nice Charles Tyrhitt one. About £30. A Ralph Lauren shirt. About £100. For the CT shirt, you are paying for a better shirt. Thicker cotton, better buttons, better quality. That’s £15. But the extra £70 for Ralph Lauren is paying so you can have a logo on it. Quality is about the same.
Same with cheapo Chinese watch, a Swatch and a Rolex. £25, £50, £5000. But a Swatch will keep time as well as a Rolex.
You get lovely Cognac from little blokes around Jarnac because they aren’t spending a fortune on advertising, sponsorship, designing labels and packaging. Most of what they produce goes into Waitrose or Tesco Cognac (Waitrose No 1 VSOP is excellent, but I forget who makes it).
A lot of folks out there don’t know understand the shift that happened which is that robots and machines came along and they make stuff better than the best humans. A Toyota is built better than a Maserati because it’s robots/ A robot fitting a windscreen can align it better than any human. It can spray a car more evenly than the best humans. And it costs less than cheap humans. So mainstream cars are nearly all robots. It’s only niche ones that have lots of humans.
The RL shirt is probably made in China by the same people who produce for Asda. Waitrose No 1 change their suppliers frequently. At one point their Sauternes was produced by Ch Suduiraut (as was the Tesco premium brand), but not last time I checked.
Does he mean “Good managers are in incredibly short supply”? or that they are incapable of thinking up environmental projects? Do bad managers think up environmental projects?
There have been thousands of environmental projects completed ranging in size from the sea wall turning the Zuider Zee into the Ijsel Meer to a monastery fish pond. Many of them were carried out with no intention to monetise the benefit (e,g, Bazalgette’s sewerage system for London), a minority (e.g Sir James Middleton’s New River providing London with clean water) were monetised.
IF a scheme is environmentally essential the government will fund it
Before anyone screams I can point out that if it was “monetisable” i.e. the expected reward exceeded the appropriate risk-adjusted rate of return, the scheme would be launched on the LSE or via iii while it was environmentally desirable *before* it became environmentally essential.
So Murphy is talking nonsense, as usual.
“Do bad managers think up environmental projects?”
From what I’ve seen, yes, it’s the bad managers who do environmentalism. They’re worried they’ll lose their job once enough people realise how useless they are, so the use environmentalism as a niche to give themselves a role that they think will be safe.
I think I’ve read that Bazalgette’s original plan was for the project to be profitable, by building blocks of flats on the newly created riverside land.
It was a politician (possibly Salisbury?) who insisted on creating parks all along it, so dumping the huge cost on the government.
I was unaware (or had completely forgotten) – but that wasn’t monetising the benefit (better health for Londoners).
The word for an investment that doesn’t deliver and never was intended to, is “scam.”