Tim Worstall

Capitalist Bastards

Really, making things cheaply:

Given that a kilt usually costs upwards of £375, I know what you\’re thinking: Scots love a bargain – or at least words to that effect – so they must be delighted at such a good deal. Well, yes and no. As prudent as Scots are – and I proudly count myself among them – after a day of wearing the £25 kilt, I\’m left wondering: is nothing sacred? I ask, not because of the inevitable chaffing that comes from wearing a kilt around the office, or the funny looks I got going to the canteen, or even because of the difficulties I encountered going to the loo, but because it\’s so cheap.

How dare they make things that the hoi polloi can afford? Next thing you know the proles will have enough to eat!

Jack Brod

Fascinating:

Another recently deceased New Yorker didn\’t even shift a millimetre across the city\’s map in nearly 80 years but still embodied the American dream.

Jack Brod, who died earlier this month at 98, chose to go up rather than across to define his success. The last original tenant of the Empire State Building, Mr Brod spent the years since it opened in 1931 gradually working his way from the seventh floor to the 76th (via the 14th, 15th and 66th) as his business grew and he could afford a better view.

He started as a Depression-era debt collector. When many debtors paid with jewellery, Mr Brod became a jeweller. Stationed in England during the Second World War, he did well from hard-up stately home owners, shipping boat-loads of cut-price antiques back to America.

Mr Brod\’s post-war entrepreneurism, including an engagement ring that "costs you nothing if she dumps you within 60 days", helped push him further up the skyscraper. By the time – reportedly, in 2004 – he was offered the solid gold dental bridge that had popped out of the mouth of a jilted lover who had jumped off the building, he could afford to say no to new business.

Entirely trivial, but fascinating.

Official:

Community life is now anti-social.

Villagers have been barred from putting up posters inviting people to charity events because it is "anti-social".

Volunteers in the hamlet of Misterton, Somerset, regularly use the village hall for coffee mornings and jumble sales to raise money for good causes.

Because of the building\’s isolated location they often put notices up around the village to drum up interest for the functions.

However, they were threatened with prosecution after local council officials discovered notices pinned up on a lamp post advertising a children\’s charity bingo.

The town hall claimed that the organisers were flyposting, which was against the law and punishable by a £75 fine.

The council told Paul Bradly, the treasurer of the village hall committee who wrote to complain, that it had a duty to "enforce legislation in regards to anti-social behaviour".

My order for lengths of the best hempen will need to be increased again I see.

I Thought Everyone Already Knew This?

Mongrels are cleverer than pedigree dogs, according to research.

Hybrid vigour isn\’t it called?

It\’s one of those things that has always amused me about those who worry about "racial purity" in humans. The more the merrier for the pool your genes come from rather than being limited to a sub-group.

 

Newsreaders Really Are Serious, Professionsal Journalists, Oh Yes

Kate Silverton, the BBC newsreader, is threatening to sue a leading Harley Street doctor after routine laser surgery left her face so badly marked she was unable to work.

Miss Silverton, 37, was forced to take a fortnight off after the laser skin-rejuvenation procedure, which should have removed acne scars and improved her skin tone, left her in agony.

Her face was covered in painful and unsightly swellings, sores and lumps.

She returned to work last week and has instructed lawyers to begin proceedings following her experience at the Jan Stanek clinic in London.

The presenter, who is tipped as the BBC\’s next golden girl now that Natasha Kaplinsky has defected to Five News, is due to take over the One O\’clock News from Sophie Raworth when she goes on maternity leave next month.

On Sunday Miss Silverton said: "It\’s been awful. I went in to get some minor scarring on my cheeks treated. I was told it would be a routine procedure and I\’d be back to work in days. The treatment, however, caused a massive skin reaction."

Miss Silverton visited Dr Stanek\’s clinic last month because she wanted to remove minor scars and blemishes before the introduction of high definition television.

Brushing up on the shorthand, taking a sabbatical to learn more about the world, practising tose precis-ing skills, just what\’s needed to revitalise the career, eh?

Sunday Arvo Music

The video to this is crap but the sound perfect. No, it\’s not the Jimmy Saville theme, it\’s the other one from the same album by Ramsey Lewis: Wade in the Water.

Mark Braund Again

Well, it looks like I did him an injustice when accusing him of socialist windbaggery.

Today, there are three major threats to society:  climate change, the growing gulf between cultures, and deepening poverty amid unprecedented wealth.

When KFC is selling in India and Chicken Masala is the most common dish in the UK that growing gulf between cultures is hard to spot.  Deepening poverty is also hard to find, given that hundreds of millions have risen up out of it in the last decade alone, the greatest diminution of poverty in the history of the planet.

Instead, it must make the moral case against all forms of unearned wealth. Certainly this includes wealth derived from land rent, but it also includes the unearned income from speculative investment, and the riches enjoyed by those who benefit from a system of debt-based money creation, condemned as immoral in ancient times, but considered perfectly legitimate today.

And that last is channeling Aquinas. Next thing you know he\’ll be fulminating about fractional reserve banking.

Ill-informed incoherence is at the same sort of level as socialist windbaggery but calling in aid a medieval monk in your critique of the perils of charging interest goes rather further.

Mark, this is the 21 st century calling, hellooooo?

Oh Dear

Imagine a warehouse full of dollar bills – seven billion of them. Now imagine someone throwing a match in.

That\’s Nicola Horlick on the Soc Gen affair. Really, you would think that she at least would know better.

It hasn\’t been a destruction of wealth. It\’s been a transfer. Equity derivatives are a zero sum game.

I hadn\’t known she was involved in the Peter Young affair though. That was a really wonderful scandal.

Shrub and Religion

Gosh, how surprising:

One of the defining aspects of George W Bush’s presidency is his professed belief in God. Yet what really are his religious beliefs? The question, which seems central to understanding his presidency, never receives a satisfactory answer. Indeed, one religious figure close to him soon after his conversion was shocked to find that he talked about sex rather than theology and says that a lot of his faith seemed to be politically calculated.

Bush’s religion has often been described as evangelical. But unlike most other evangelicals, he blithely uses profanity and as governor of Texas he would play poker. He doesn’t pay tithes, he doesn’t try to convert others – one of the central obligations in most evangelical denominations. And he didn’t raise his daughters in the faith.

What Bush clearly does believe in is the personal, transforming and sustaining power of belief in God. Having a personal relationship with God, praying and reading the Bible daily were the tools he used to get control of his life more than 20 years ago.

The man is a politician, after all.

But cynicism aside, that looks a lot more like religion the Alcoholics Anonymous way than it does the evangelical way.

No, People Are Not Rational

Tim Harford\’s new book is out next week and I\’m reading my copy (there are perks to being an econ blogger).

The Undercover Economist, his first book, sold 600,000 copies worldwide, 160,000 of them in Britain. Books based on economics are not supposed to sell that well, let alone be prominently displayed on the bestseller racks by WH Smith. Were it not for Freakonomics, by the American economists Stephen Dubner and Steven Levitt, which has sold an extraordinary 3m copies, Harford’s achievement would be even more outstanding.

His second book, The Logic of Life, is published next week by Little, Brown. Harford is one of life’s nice guys, so it is a bit of a shock to open the new book and go straight into oral sex, apparently the rational choice of American teenagers worried about Aids or abortion. But like its predecessor it is never short of interest.

The essential point is that people are indeed rational (with the sub-point that the more expert at something we are, the more rational we become. This has very interesting implications: as food shopping, for example, tends to be done by those who do it a lot then food labelling doesn\’t have to be all that simple and obvious. However, as buying a house is something that most of us do a few times at most in a lifetime then the possibility that we\’ll do something irrational is much greater.)

However, the introduction talks about living in Hackney. A not very good area of Hackney, too. And this from a man who has sold 600,000 books and cashed the royalty cheques on that number.

So humans may indeed be rational most of the time but perhaps Tim Harford isn\’t?

🙂

More on the book once the embargo is lifted.

Top Ideas to Make Britain Better

Some of these are very good indeed.

Paul Ormerod economist

I would make more explicit the connection between tax and services received by abolishing the PAYE system. Instead of income tax being deducted by employers at source, I would make everyone sign a cheque to pay their tax. While it would increase administration in the first instance, it would bring home to people what they are paying for. When you physically hand money over, you inevitably question whether you are receiving value for money. This system would put political pressure on public services to ensure they deliver efficiently and would prevent the waste of public funds.

David Starkey historian

I would remove everyone earning less than £25,000 a year out of the tax system. At the moment we have a ridiculous circular system in which people are taxed, then given their money back in tax credits. It produces the idea of the state as provider – for something like one-third of the population. It imprisons people we should be liberating.

Chris Woodhead former chief inspector of schools

I would introduce an education voucher for parents with school-age children. The voucher would pay for a state education but could be cashed in at independent schools as payment or part-payment. It would help to make the rhetoric of parental choice a reality; would promote new providers of education in to the market and at a blow, would destroy the state monopoly which has created appallingly low standards which we see in so many schools today.

Die Bitch, Die!

A WOMAN suffering from breast cancer has run out of time to benefit from a potentially life-extending drug which the National Health Service (NHS) denied her, even though she was prepared to pay for it.

Colette Mills has been told by doctors that in the four months since she asked for the drug the disease has taken such a hold in her body that the cancer will no longer respond to the treatment.

She is the victim of a ruling which states that any patient who wants to pay for additional drugs not prescribed by the NHS should lose their entitlement to their basic NHS cancer care and pay for all their treatment. She was prepared to pay for the drug but not her whole treatment.

Mills, a 58-year-old former nurse, said: “I am just absolutely gutted. I just cannot believe people make these decisions about other people’s lives.

“It wasn’t going to cost them. I was going to pay for it. How can they say this policy is far more important than somebody’s life?

“The NHS has taken this opportunity away from me and, if they are doing it to me, they are doing it to a lot of other women as well.”

The government claims that to allow some patients to pay for additional drugs on top of their NHS treatment creates a two-tier system between those who can and cannot afford them.

Equality is so important that people should die to ensure it, don\’t you think?

Beardie Weirdie

Not that I have a great deal of time for him but he\’s right here:

\’Sadly,\’ Branson told an interviewer at Davos two years ago, \’I don\’t think politicians are really in a position to change the world for the better. One of the problems politicians have is they come and go, but perhaps entrepreneurs can stay for 40, or 50 or 60 years.\’

Will Hutton Again

Crippled Jesu Christe on a crutch:

One of the reasons why rogue trader Jérôme Kerviel faked a stunning £3.7bn of transactions at SocGen may have been because he regarded himself as being paid as a beta when he should have been paid as an alpha like everybody else.

Why is Hutton employed to write on matters financial? He doesn\’t seem to know the difference between transactions and losses.

That\’s the amount that was lost by Soc Gen in trying to clean up Kerviel\’s trades. His actual transactions have been (by working backwards from the losses, looking at the changes in market prices) estimated at €30 billion or so.

Someone who doesn\’t know the difference between these two things should really put down their prejudices and step away from the keyboard.

The rest of it is all about how finance should be regulated like a utility: welcome back the "queue" to get your mortgages folks.

Thirteen years ago, I tried to blow the whistle on financial market liberalisation in my book The State We\’re In. It was obvious then what is even more obvious now: financial market freedom embeds short-termism, guarantees lower investment, works against business building and innovation, generates booms and busts, inflates house prices, creates system-wide risk and excessively rewards those who work in them. I thought the Germans and Japanese were better than the British and Americans in the way they organised and regulated finance and that while Britain and America might look good in the short term, their economies would eventually come back to earth with a bump.

Allow that all of that is true (it isn\’t, but we\’ll allow Willy his moment of glory). 13 years for a prophecy to come true is actually really rather a long time as far as an economy is concerned. What would be most intriguing to look at is, after the slump in Anglo-Saxon economies that\’s predicted, what are the end results of the comparison between the two systems?

13 years ago the German and Japanese economies were at x and y GDP respectively, the US and UK at a and b similarly. So, have x+13, y+13, shown a higher growth rate than a+13 and b+13?

No, I don\’t have those figures to hand, but that would be the way to work out which was a better system of financial managment: the Anglo system might have greater volatility, but what if it provides better results in the longer term?