The old axiom that one should never speak ill of the dead has been sorely tested by obituarists over the holiday season. (Oh, sure, James Brown was given a fine sendoff, and so for the most part was the largely forgotten Charlie Drake, but it's the "bad" guys who are the most interesting). Not surprisingly, nobody had much positive to say about Saddam, notwithstanding the fact that at the time of many of his worst atrocities, he was effectively a client of the United States as he fought against the Khomeinist regime in Iran. It's ironic that he has been bundled to the gallows after a show trial, right about the time when the US is realising that having a secularist strongman in power in Baghdad might not be the worst possible outcome.
Most intriguing of all is the treatment of the "accidental President", Gerald Ford. Official America has gone into a period of mourning that is set to last almost as long as Ford's presidency, but obituarists from both right and left have been much less charitable. Many have praised the "healing" that Ford fostered after the Watergate scandal. However, there have been severe criticisms of his decision to pardon his predecessor, Richard Nixon, for his role in Watergate, and equally harsh words for his policy ineptitude, most notably in foreign affairs.
One of the most scathing attacks has come from the reliably splenetic (but always principled) Christopher Hitchens on Slate. As well as condemning the Nixon pardon, Hitchens cites Ford's malign impact on the course of events in Russia, Iraq and elsewhere. It's a damn good read, all the more interesting because I'm not at all sure that Hitchens actually cares about Ford one way or the other. The real object of his contempt is the man he sees as the architect of all of Ford's bad decisions, Henry Kissinger. Hitchens has written vitriolically about Kissinger for many years. You could almost get the impression that he's getting all of the bile out of the way so that he can avoid speaking too much ill when Kissinger passes on. When that happens, though, I'd bet that Hitchens and a lot of other people won't be able to hold back.
Sunday, 31 December 2006
Thursday, 21 December 2006
Retail sales rise shock horror
Here we are a few days before Christmas, and the retailers (well, the CBI on their behalf) are admitting that they're having a pretty good time of it. In the past few weeks most of the chatter from the industry has been doom-laden, but (for reasons set out below) I have learned never to believe anything that the retailers tell us. For better or worse, you have to wait for the official ONS data to find out what's really happening.
Economists are not supposed to rely on anecdotal data, but we all do, and the UK retail and housing sectors don't give you much choice in the matter. I became suspicious of this year's laments when I went to an out-of-town M & S on two consecutive weekdays in late November, to find the place heaving. Earlier this month, the temporary pedestrianisation of Oxford Street apparently led to unbelievable overcrowding. Now, surprise surprise, the CBI has admitted that all of those people were spending money, not just mooning around.
The CBI and its friends at the British Retail Consortium (BRC) publish data that seem designed to put as bad a gloss on retail activity as possible. Partly this reflects the industry's addiction to "same store" data for year-to-year comparisons. The claim is that this allows a better view of the underlying trends, but the truth is the exact opposite. Ignoring store openings makes it impossible to assess overall volumes. Look at it this way: if you wanted to look at long-term trends in global industrial output, would you think it would be helpful to leave out data from China, on the grounds that they weren't players a few years ago?
Then there are the surveys themselves. The CBI doesn't ask "are your sales up or down?" It asks stores to say whether sales are higher or lower than expected, and compares those results with those it got for the same question last year. If a lot of companies are expecting a 10% sales gain but are only seeing a 5% rise, they give a negative answer, even though actual sales are higher. The CBI then packages this convoluted nonsense into a press release that says "Retail sales lowest in 20 years" or whatever, and the press faithfully report it as such. The CBI may not be intending to mislead the public with these surveys, but to be honest I'm not sure what else they can be trying to do.
The old joke was that farmers always complained about the weather, no matter what it was. The retailers have raised that to a fine art -- and don't get me started on the estate agents.
Economists are not supposed to rely on anecdotal data, but we all do, and the UK retail and housing sectors don't give you much choice in the matter. I became suspicious of this year's laments when I went to an out-of-town M & S on two consecutive weekdays in late November, to find the place heaving. Earlier this month, the temporary pedestrianisation of Oxford Street apparently led to unbelievable overcrowding. Now, surprise surprise, the CBI has admitted that all of those people were spending money, not just mooning around.
The CBI and its friends at the British Retail Consortium (BRC) publish data that seem designed to put as bad a gloss on retail activity as possible. Partly this reflects the industry's addiction to "same store" data for year-to-year comparisons. The claim is that this allows a better view of the underlying trends, but the truth is the exact opposite. Ignoring store openings makes it impossible to assess overall volumes. Look at it this way: if you wanted to look at long-term trends in global industrial output, would you think it would be helpful to leave out data from China, on the grounds that they weren't players a few years ago?
Then there are the surveys themselves. The CBI doesn't ask "are your sales up or down?" It asks stores to say whether sales are higher or lower than expected, and compares those results with those it got for the same question last year. If a lot of companies are expecting a 10% sales gain but are only seeing a 5% rise, they give a negative answer, even though actual sales are higher. The CBI then packages this convoluted nonsense into a press release that says "Retail sales lowest in 20 years" or whatever, and the press faithfully report it as such. The CBI may not be intending to mislead the public with these surveys, but to be honest I'm not sure what else they can be trying to do.
The old joke was that farmers always complained about the weather, no matter what it was. The retailers have raised that to a fine art -- and don't get me started on the estate agents.
Tuesday, 19 December 2006
"Top people take the Times"
You probably have to be near retirement age to remember when the Times used that slogan in its advertising. Back then the paper's view of just who the top people were would have included the Royal Family, the peerage and gentry, Oxbridge types and such. In the more egalitarian Age of Instant Celebrity in which we now live, the Times has shifted its sights. Its new obsession is money -- lots of it, preferably more than you know what to do with.
The Times has run a raft of pieces in the last few weeks designed to put the merely affluent firmly in their place. There was an article on "the Haves and Have yachts", which suggested that the latter might not come and visit you because they would assume your servants were not up to snuff; a soporific article on the very wealthy people who manage the money of the uber wealthy; advice from Lucia van der Post on what to get for the post-modern squillionaire (including what appeared to be a day trip to Venice for £8500 per head); and of course almost daily updates on the size of the City bonus pool. Even for someone like me who worked in the financial sector for many years, it's all been much too much, especially as almost none of it could be regarded as news or even as intelligent comment.
Interestingly, there are signs that some of the Times's columnists, always to the left of the Murdoch-driven editorial line, are feeling a bit queasy with it all. One of the more gossipy columnists noted that the grandees at one City bank had celebrated their latest windfall with a tastefully updated version of Saint Bob Geldof: "Do they know it's bonus time at all?". Mercifully, the columnist managed to report this in an appropriately scornful tone, noting that even some of those present had seemed discomfited by it.
Even the Sunday Times economics columnist, David Smith, sounded a more cautious note. He noted the proliferation of extravagant displays of Christmas lights this year -- which I'd say were one of God's ways of telling you that you have too much money, except that the kind of people who do such things are probably not very big on the religious aspects of Christmas anyway. Smith then made the surprising but doubtless true observation that within 100 yards of each such monument to waste, there was probably a pensioner turning down the gas fire in order to avoid excessive heating bills. Bravo Mr Smith!
I've been rich and I've been poor, and rich is definitely better. But whereas the Times's former "top people" had some sense of their role in a wider society (and a term for it: noblesse oblige), many of today's wealth-defined elite seem more interested in pulling up the drawbridge. We're all poorer for that.
The Times has run a raft of pieces in the last few weeks designed to put the merely affluent firmly in their place. There was an article on "the Haves and Have yachts", which suggested that the latter might not come and visit you because they would assume your servants were not up to snuff; a soporific article on the very wealthy people who manage the money of the uber wealthy; advice from Lucia van der Post on what to get for the post-modern squillionaire (including what appeared to be a day trip to Venice for £8500 per head); and of course almost daily updates on the size of the City bonus pool. Even for someone like me who worked in the financial sector for many years, it's all been much too much, especially as almost none of it could be regarded as news or even as intelligent comment.
Interestingly, there are signs that some of the Times's columnists, always to the left of the Murdoch-driven editorial line, are feeling a bit queasy with it all. One of the more gossipy columnists noted that the grandees at one City bank had celebrated their latest windfall with a tastefully updated version of Saint Bob Geldof: "Do they know it's bonus time at all?". Mercifully, the columnist managed to report this in an appropriately scornful tone, noting that even some of those present had seemed discomfited by it.
Even the Sunday Times economics columnist, David Smith, sounded a more cautious note. He noted the proliferation of extravagant displays of Christmas lights this year -- which I'd say were one of God's ways of telling you that you have too much money, except that the kind of people who do such things are probably not very big on the religious aspects of Christmas anyway. Smith then made the surprising but doubtless true observation that within 100 yards of each such monument to waste, there was probably a pensioner turning down the gas fire in order to avoid excessive heating bills. Bravo Mr Smith!
I've been rich and I've been poor, and rich is definitely better. But whereas the Times's former "top people" had some sense of their role in a wider society (and a term for it: noblesse oblige), many of today's wealth-defined elite seem more interested in pulling up the drawbridge. We're all poorer for that.
Friday, 15 December 2006
Ranting and railing
This week's BBC documentary about the 2002 Potters Bar rail crash, which killed seven people, offered a reminder of one of the unfortunate side-effects of the ludicrous "privatisation" of the railways: nobody is responsible for anything any more. Amazingly, thanks to years of work by a team of investigators, the exact cause of the disaster has been established. But with the company responsible for maintenance of the tracks alternately stalling and hiding behind their lawyers, it has proved impossible to assign any actual responsibility.
When I used to commute daily into London, I used to marvel at the number of fragments that the old British Rail monolith had been shattered into. I parked in a car park operated by a subsidiary of the train operating company (TOC). The station was owned by Network Rail but operated by the TOC. The tracks were owned by Network Rail but maintained by a separate company under contract -- with, as the Potters Bar documentary showed, hundreds of sub-contractors. The train was operated and maintained by the TOC, but owned by one of the three leasing companies set up under the privatisation. And this is not to mention all the separate companies running peripheral things like coffee bars and vending machines.
This seems to me to violate one of the key principles of effective corporate structure: clear lines of responsibility. Ultimately nobody seems to accept responsibility for anything on the railways any more, except of course for the passengers and taxpayers who are footing the bill for this massive pyramid of overheads. It seems pretty clear in the case of the Potters Bar crash that there were some fundamental design flaws in the points that derailed the train. It does not appear that anyone responsible for managing maintenance recognised that, but the maintenance workers themselves apparently did, and had devised a crude "fix" that may well have prevented other accidents. Amazingly, both the maintenance company and the TOCs on the Potters Bar line seem to have tried their damnedest to prevent their employees from assisting the enquiry into the crash. There is to be yet another enquiry in 2007, and naturally the companies are happy to see the matter remain sub judice.
Not all privatisations have been a failure, of course. Who now thinks it would be a good idea for BT or BA to be in public ownership? But the list of problematic privatisations is so large -- the railways, London Underground, many many PFI schemes -- that it is important to try to spot the common elements behind the problems. Here's my candidate: the civil servants charged with selling the public assets have no understanding of how the private sector thinks, and have either erred or been outfoxed at every turn. Examples:
* excessive complexity, as in the case of the railways. Companies are always happy to avoid responsibility and blame, something that a truly free market does not normally allow them to do.
* inappropriate term of contracts. On the railways, where some of the key assets (the trains) have economic lives of 40 years, many of the contracts have been for five years or less. As a result, TOCs have been reluctant to order new equipment -- a problem compounded by the fact that they have to finance it through the leasing companies, who seem more interested in sweating the existing assets. In contrast, there are stories of office cleaning companies being awarded 50-60 year contracts by local councils -- hardly necessary or appropriate when the main resource is people and the capital requirements are minimal.
* improperly specified contracts. The negotiations over the part-privatisation of London Underground were very drawn out, yet within a few weeks of the contract going into force, there was a dispute about whose job it was to clean up graffiti. What exactly had they been talking about for all that time? Now, a couple of years into the contract, one of the companies has failed in meeting almost all of its key performance targets. So what will happen? Well, it wants more favourable terms, and will probably get them. Quite by chance, while the company is awaiting the Government's response, the reliability of the Underground has fallen to new lows.
No major political party seems inclined to do anything about any of this. In fact, it appears that Gordon Brown is preparing to sell off more assets as soon as he gets into Number 10. Some of these, including the Tote, should not be problematic -- in fact, why is that in the public sector anyway? But in other cases, it would be nice to think that the Government would apply a test to privatisation candidates: if the only way to sell something is to chop it into pieces and then set up a complex regulatory regime, maybe it would be better just to keep it in public ownership.
When I used to commute daily into London, I used to marvel at the number of fragments that the old British Rail monolith had been shattered into. I parked in a car park operated by a subsidiary of the train operating company (TOC). The station was owned by Network Rail but operated by the TOC. The tracks were owned by Network Rail but maintained by a separate company under contract -- with, as the Potters Bar documentary showed, hundreds of sub-contractors. The train was operated and maintained by the TOC, but owned by one of the three leasing companies set up under the privatisation. And this is not to mention all the separate companies running peripheral things like coffee bars and vending machines.
This seems to me to violate one of the key principles of effective corporate structure: clear lines of responsibility. Ultimately nobody seems to accept responsibility for anything on the railways any more, except of course for the passengers and taxpayers who are footing the bill for this massive pyramid of overheads. It seems pretty clear in the case of the Potters Bar crash that there were some fundamental design flaws in the points that derailed the train. It does not appear that anyone responsible for managing maintenance recognised that, but the maintenance workers themselves apparently did, and had devised a crude "fix" that may well have prevented other accidents. Amazingly, both the maintenance company and the TOCs on the Potters Bar line seem to have tried their damnedest to prevent their employees from assisting the enquiry into the crash. There is to be yet another enquiry in 2007, and naturally the companies are happy to see the matter remain sub judice.
Not all privatisations have been a failure, of course. Who now thinks it would be a good idea for BT or BA to be in public ownership? But the list of problematic privatisations is so large -- the railways, London Underground, many many PFI schemes -- that it is important to try to spot the common elements behind the problems. Here's my candidate: the civil servants charged with selling the public assets have no understanding of how the private sector thinks, and have either erred or been outfoxed at every turn. Examples:
* excessive complexity, as in the case of the railways. Companies are always happy to avoid responsibility and blame, something that a truly free market does not normally allow them to do.
* inappropriate term of contracts. On the railways, where some of the key assets (the trains) have economic lives of 40 years, many of the contracts have been for five years or less. As a result, TOCs have been reluctant to order new equipment -- a problem compounded by the fact that they have to finance it through the leasing companies, who seem more interested in sweating the existing assets. In contrast, there are stories of office cleaning companies being awarded 50-60 year contracts by local councils -- hardly necessary or appropriate when the main resource is people and the capital requirements are minimal.
* improperly specified contracts. The negotiations over the part-privatisation of London Underground were very drawn out, yet within a few weeks of the contract going into force, there was a dispute about whose job it was to clean up graffiti. What exactly had they been talking about for all that time? Now, a couple of years into the contract, one of the companies has failed in meeting almost all of its key performance targets. So what will happen? Well, it wants more favourable terms, and will probably get them. Quite by chance, while the company is awaiting the Government's response, the reliability of the Underground has fallen to new lows.
No major political party seems inclined to do anything about any of this. In fact, it appears that Gordon Brown is preparing to sell off more assets as soon as he gets into Number 10. Some of these, including the Tote, should not be problematic -- in fact, why is that in the public sector anyway? But in other cases, it would be nice to think that the Government would apply a test to privatisation candidates: if the only way to sell something is to chop it into pieces and then set up a complex regulatory regime, maybe it would be better just to keep it in public ownership.
Tuesday, 12 December 2006
A-levels that go to 11
The Government is gearing up to have another go at reforming education. Data out this week suggest they may have a reason to do so: the number of people aged 15-24 who are neither working nor studying has ballooned since Labour came to power. If you're not gainfully occupied at that age, there's not much chance of you doing anything useful with the rest of your life.
One particular concern for the Government is the continued under-representation of the poor in the top Universities. And the proposed remedy? The Government has announced the introduction of a new "A-star" grade to A-level results. I suggest that this grade should be known as a "Tufnel", after the Spinal Tap guitarist whose prized amplifier "goes to 11".
Does the Government's track record in the field of education allow any reason for hope that this time they'll get it right? Let's answer that by posing an imaginary A-level question to Tony Blair and all the folks who've handled the education portfolio over the years:
"You are the Minister of Education. You introduce measures to force students to borrow money to finance the cost of their higher education. You allow the best universities to increase tuition costs toward market levels. You devalue the examination system so that universities cannot trust it to identify the best candidates. What exactly do you expect to happen?"
The issue of who should pay for higher education is a tricky one. You can argue that graduates will earn more than non-graduates over the course of their careers, and can therefore safely be asked to pay back the cost of their education once they start work. Against that, however, you can argue that an increase in overall education levels benefits all of society, not just the graduates, so society should bear some or all of the cost.
In my day the UK addressed this problem in a highly counter-intuitive way, with local authorities paying for higher education for people from their areas, subject to a very small means test. This worked out fine for me, but has always struck me as bizarre: if getting a higher education guarantees anything, it's that you will move away from the place you grew up. The London Borough of Waltham Forest paid for my education, but I've never paid a penny of tax there in the 35 years since I graduated.
Amazingly, vestiges of this approach still exist, but more and more of the burden is being pushed onto the students (or their families). This may not be a problem if you're the scion of some middle class family; but I have no hesitation in saying that if these rules had been in place when I was growing up, I would very likely never have gone to Cambridge. Much better to minimise my risks by going to somewhere less challenging (and less expensive).
Then there are the A-levels, even before the "Tufnel" grade comes into effect. I was a pretty bright kid and I got three A-levels, which was the norm back in the late 60s. That took two years of hard work, plus three exams of up to three hours each for each subject. All of the exams involved essay writing: there were no multiple choice questions. No allowance was made for coursework and you could not appeal if you didn't like the results. To enhance my chances of getting the university place I wanted, I also took two optional "special" papers in my two main subjects, and also had to pass an exam known as "Use of English". On one memorable day in 1967 I had three A-level exams -- 9 am to noon, 1:30 to 4:30 and 5 until 6:30. In terms of my future, you can argue that was the most important day of my life. I was 17.
I will state categorically that no normal person could have got good grades in more than three or at most four A-levels in those days -- and no university expected you to try. The universities knew that the A-levels would identify those who were most likely to succeed at undergraduate level, while the Use of English exam ensured there was no need for remedial reading courses for first-year students.
Now we hear that Cambridge is so disillusioned with A-levels that it is considering sponsoring a "pre-U" exam that will allow it to identify the candidates it wants. Ask yourself: who is going to be able to provide the specialised teaching to allow students to succeed at the pre-U: public schools, or your local comprehensive? (Oops, multiple choice question -- I must be dumbing down). If the Government doesn't want the number of poor students at the best universities to dwindle even further, it needs to restore faith in the public exam system. If it wants to take on a consultant to help out, it shouldn't hire Nigel Tufnel.
One particular concern for the Government is the continued under-representation of the poor in the top Universities. And the proposed remedy? The Government has announced the introduction of a new "A-star" grade to A-level results. I suggest that this grade should be known as a "Tufnel", after the Spinal Tap guitarist whose prized amplifier "goes to 11".
Does the Government's track record in the field of education allow any reason for hope that this time they'll get it right? Let's answer that by posing an imaginary A-level question to Tony Blair and all the folks who've handled the education portfolio over the years:
"You are the Minister of Education. You introduce measures to force students to borrow money to finance the cost of their higher education. You allow the best universities to increase tuition costs toward market levels. You devalue the examination system so that universities cannot trust it to identify the best candidates. What exactly do you expect to happen?"
The issue of who should pay for higher education is a tricky one. You can argue that graduates will earn more than non-graduates over the course of their careers, and can therefore safely be asked to pay back the cost of their education once they start work. Against that, however, you can argue that an increase in overall education levels benefits all of society, not just the graduates, so society should bear some or all of the cost.
In my day the UK addressed this problem in a highly counter-intuitive way, with local authorities paying for higher education for people from their areas, subject to a very small means test. This worked out fine for me, but has always struck me as bizarre: if getting a higher education guarantees anything, it's that you will move away from the place you grew up. The London Borough of Waltham Forest paid for my education, but I've never paid a penny of tax there in the 35 years since I graduated.
Amazingly, vestiges of this approach still exist, but more and more of the burden is being pushed onto the students (or their families). This may not be a problem if you're the scion of some middle class family; but I have no hesitation in saying that if these rules had been in place when I was growing up, I would very likely never have gone to Cambridge. Much better to minimise my risks by going to somewhere less challenging (and less expensive).
Then there are the A-levels, even before the "Tufnel" grade comes into effect. I was a pretty bright kid and I got three A-levels, which was the norm back in the late 60s. That took two years of hard work, plus three exams of up to three hours each for each subject. All of the exams involved essay writing: there were no multiple choice questions. No allowance was made for coursework and you could not appeal if you didn't like the results. To enhance my chances of getting the university place I wanted, I also took two optional "special" papers in my two main subjects, and also had to pass an exam known as "Use of English". On one memorable day in 1967 I had three A-level exams -- 9 am to noon, 1:30 to 4:30 and 5 until 6:30. In terms of my future, you can argue that was the most important day of my life. I was 17.
I will state categorically that no normal person could have got good grades in more than three or at most four A-levels in those days -- and no university expected you to try. The universities knew that the A-levels would identify those who were most likely to succeed at undergraduate level, while the Use of English exam ensured there was no need for remedial reading courses for first-year students.
Now we hear that Cambridge is so disillusioned with A-levels that it is considering sponsoring a "pre-U" exam that will allow it to identify the candidates it wants. Ask yourself: who is going to be able to provide the specialised teaching to allow students to succeed at the pre-U: public schools, or your local comprehensive? (Oops, multiple choice question -- I must be dumbing down). If the Government doesn't want the number of poor students at the best universities to dwindle even further, it needs to restore faith in the public exam system. If it wants to take on a consultant to help out, it shouldn't hire Nigel Tufnel.
Thursday, 7 December 2006
Green taxes, dark thoughts
As someone who has made a career out of being a business economist, I guess I am supposed to believe unquestioningly in the ability of free markets and the price mechanism to deliver the optimal allocation of scarce resources. However, I am finding it harder and harder to keep the faith.
My latest bout of uncertainty has been triggered by the "green" tax increases announced by Gordon Brown in the pre-budget statement this week: a small increase in taxes on motor fuels, and a doubling (though still to a very low level) of the tax on passenger flights. Even these very modest moves have been criticised. The freight lobby has muttered about fresh fuel protests, though it's hard to see there would be any public support for that, given the current "green" mood. For their part, airlines are decrying what they portray as a tax grab that will do nothing to change consumer behaviour. They are clearly quite confident in this assessment of the elasticity of demand: BA has already indicated that it plans to pass the tax on to passengers.
Where things get trickier for me is when I start to contemplate the much larger price changes that may be needed in the future if we are actually going to get serious about global warming. A big jump in fuel prices is not going to deter Roman Abramovich from filling up his tenth yacht, or stop investment bankers from driving to their second homes in SUVs. But it might force some nurse or teacher somewhere to conclude, sadly, that she can't afford to take a slightly better job in the next town because she can't afford the commute. I may stump up for higher fares for my three or four trips abroad each year, but the low-wage family of four may have to go without a holiday at all. (Aside: it has been reported that SUV sales have fallen sharply in recent months. I would be very surprised if this has very much to do with fuel costs, which are much lower than they were at the start of the year. It's happened because the green lobby has succeeded in demonising the accursed things).
In a world of winner-takes-all capitalism these thoughts may come across as heretical, but I think the possibility that green policies will lead to an of ever-widening gap between the lifestyle of the Rich and Famous and that of the rest of the population should be a real matter for concern. There seems to be some recognition of this in the media -- and not just in the Guardian. People are wondering if there some non-price alternative that should be considered. I imagine my personal preference -- ban any vehicle that Jeremy Clarkson likes -- will be rejected as too simplistic. But I have seen a couple of commentators suggesting that every adult should get some kind of annual fuel allowance, with those who don't use it permitted either to sell it to the highest bid from the local petrolheads (which would provide extra cash for those too poor to travel) or to tear up the fuel coupons (which would allow the greenest members of the population to make an extra contribution to reducing overall fuel use).
After a lifetime of supply and demand curves and competitive forces, this sort of proposal makes me queasy. However, the recent surge in environmental awareness is likely to persist for many years. Consequently, I think we can expect to see more musings about non-price-based methods of curbing travel as Governments realise the dangers of letting the price mechanism do all the work.
My latest bout of uncertainty has been triggered by the "green" tax increases announced by Gordon Brown in the pre-budget statement this week: a small increase in taxes on motor fuels, and a doubling (though still to a very low level) of the tax on passenger flights. Even these very modest moves have been criticised. The freight lobby has muttered about fresh fuel protests, though it's hard to see there would be any public support for that, given the current "green" mood. For their part, airlines are decrying what they portray as a tax grab that will do nothing to change consumer behaviour. They are clearly quite confident in this assessment of the elasticity of demand: BA has already indicated that it plans to pass the tax on to passengers.
Where things get trickier for me is when I start to contemplate the much larger price changes that may be needed in the future if we are actually going to get serious about global warming. A big jump in fuel prices is not going to deter Roman Abramovich from filling up his tenth yacht, or stop investment bankers from driving to their second homes in SUVs. But it might force some nurse or teacher somewhere to conclude, sadly, that she can't afford to take a slightly better job in the next town because she can't afford the commute. I may stump up for higher fares for my three or four trips abroad each year, but the low-wage family of four may have to go without a holiday at all. (Aside: it has been reported that SUV sales have fallen sharply in recent months. I would be very surprised if this has very much to do with fuel costs, which are much lower than they were at the start of the year. It's happened because the green lobby has succeeded in demonising the accursed things).
In a world of winner-takes-all capitalism these thoughts may come across as heretical, but I think the possibility that green policies will lead to an of ever-widening gap between the lifestyle of the Rich and Famous and that of the rest of the population should be a real matter for concern. There seems to be some recognition of this in the media -- and not just in the Guardian. People are wondering if there some non-price alternative that should be considered. I imagine my personal preference -- ban any vehicle that Jeremy Clarkson likes -- will be rejected as too simplistic. But I have seen a couple of commentators suggesting that every adult should get some kind of annual fuel allowance, with those who don't use it permitted either to sell it to the highest bid from the local petrolheads (which would provide extra cash for those too poor to travel) or to tear up the fuel coupons (which would allow the greenest members of the population to make an extra contribution to reducing overall fuel use).
After a lifetime of supply and demand curves and competitive forces, this sort of proposal makes me queasy. However, the recent surge in environmental awareness is likely to persist for many years. Consequently, I think we can expect to see more musings about non-price-based methods of curbing travel as Governments realise the dangers of letting the price mechanism do all the work.
Don't buy me "Love"
The Beatles remix album, Love, was at the top of my Christmas list -- right up to the moment when I actually heard it. The BBC was kind enough to make it the "album of the week" a while back, which mercifully saved me from having to buy it. The top item on my Christmas list is now a voodoo doll of Sir George Martin, together with a large supply of pins.
I am a big fan of mixing musical genres, as a perusal of my CD collection would quickly reveal. (Reggae tribute to Bob Dylan, anyone?) One of my musical highlights for this year was hearing the warm-up act at a Waterboys concert do an acoustic folk version of "I second that emotion". (The Waterboys were good, too). But "Love" is nowhere near as ambitious as that. For much of the time you can think that you are listening to the original versions of the songs; then, suddenly, there is a bar or two of another song, which makes about the same impact, and is about as welcome, as interference on the radio. Elsewhere there are attempts to splice things together: for example, a "Blackbird"/"Yesterday" track that has the intro to "Blackbird" lead into the lyrics and instrumentation of "Yesterday". The result is not a happy one. (I suppose even George Martin couldn't do it the other way round, since "Yesterday" has very little in the way of an intro).
I know Paul McCartney may need a little extra cash in the near future, but it's hard to see why he and Ringo went along with this travesty. Before George Martin became the Beatles' producer, he was best-known for producing comedy albums. So I suppose he's gone back to his roots with this album, because "Love" is a joke.
I am a big fan of mixing musical genres, as a perusal of my CD collection would quickly reveal. (Reggae tribute to Bob Dylan, anyone?) One of my musical highlights for this year was hearing the warm-up act at a Waterboys concert do an acoustic folk version of "I second that emotion". (The Waterboys were good, too). But "Love" is nowhere near as ambitious as that. For much of the time you can think that you are listening to the original versions of the songs; then, suddenly, there is a bar or two of another song, which makes about the same impact, and is about as welcome, as interference on the radio. Elsewhere there are attempts to splice things together: for example, a "Blackbird"/"Yesterday" track that has the intro to "Blackbird" lead into the lyrics and instrumentation of "Yesterday". The result is not a happy one. (I suppose even George Martin couldn't do it the other way round, since "Yesterday" has very little in the way of an intro).
I know Paul McCartney may need a little extra cash in the near future, but it's hard to see why he and Ringo went along with this travesty. Before George Martin became the Beatles' producer, he was best-known for producing comedy albums. So I suppose he's gone back to his roots with this album, because "Love" is a joke.
Tuesday, 5 December 2006
Neither independent nor a deterrent
Tony Blair is having quite a week. Today he's explaining why it will be good for us to travel further for emergency medical treatment. I may come back to that topic another time (though perhaps not, if I suffer a heart attack and die in the ambulance on the way to a hospital in another time zone). But for the moment I want to concentrate on Monday's announcement that the Government is going to spend £21 billion to "upgrade" the UK's "independent" nuclear "deterrent".
Now, it would be foolish to deny that having control of its own armed forces has served the UK pretty well in the past. The course of world history would have been much different if Churchill had needed permission from President Roosevelt to get the Spitfires aloft in June 1940. ("Yo Churchill! We aren't even going to decide about getting into your war for another 18 months, so those planes are just going to have to stay on the ground!")
The argument for an "independent" deterrent is that a situation might arise when the UK would feel the need to fire off a nuke, in a conflict where the US is once again not involved. I can't really see what that situation might be, but it's probably not relevant anyway. The Government is anxious to stress that the weapons could only be fired on orders from the Prime Minister. However, it seems to be well-established that the firing codes will remain under the control of the United States. Blair or his successor may get in a mood to go all Hiroshima on some terror-state's ass, but he can't do it unless some guy at Norad gives the go-ahead. To use a bit of economics terminology, Blair's willingness to go nuclear is a necessary but not a sufficient condition for the weapons to be used. That doesn't seem much like "independent" to me.
As for the "deterrent" bit, we seem to be in the biggest era of nuclear proliferation in many years, with half the Middle East thinking about joining the club. (Saudi Arabia! Morocco!!) It's striking that the countries that are pushing the hardest, like North Korea and Iran, are the ones that are most likely to come under a direct threat from the US. The west's nukes seem to be encouraging them to tool up, rather than deterring them; however, the difference between the way the US has acted in Iraq and Iran (or Korea) suggests that they are certainly succeeding in deterring us. If lots of countries of dubious political stability are going nuclear, we'd look pretty foolish making a unilateral decision to go in the opposite direction. Politicians hate looking foolish. But we shouldn't pretend that this week's decision will do anything to improve global peace and stability, or even to reduce the threat to the UK.
As far as I'm concerned, what Blair has announced is a plan to build three new nuclear subs for the US Navy. (Actually they'll probably build four; once you've done the expensive design work, it would be rude not to). It may have been a predictable decision, but it's still a sad one.
Now, it would be foolish to deny that having control of its own armed forces has served the UK pretty well in the past. The course of world history would have been much different if Churchill had needed permission from President Roosevelt to get the Spitfires aloft in June 1940. ("Yo Churchill! We aren't even going to decide about getting into your war for another 18 months, so those planes are just going to have to stay on the ground!")
The argument for an "independent" deterrent is that a situation might arise when the UK would feel the need to fire off a nuke, in a conflict where the US is once again not involved. I can't really see what that situation might be, but it's probably not relevant anyway. The Government is anxious to stress that the weapons could only be fired on orders from the Prime Minister. However, it seems to be well-established that the firing codes will remain under the control of the United States. Blair or his successor may get in a mood to go all Hiroshima on some terror-state's ass, but he can't do it unless some guy at Norad gives the go-ahead. To use a bit of economics terminology, Blair's willingness to go nuclear is a necessary but not a sufficient condition for the weapons to be used. That doesn't seem much like "independent" to me.
As for the "deterrent" bit, we seem to be in the biggest era of nuclear proliferation in many years, with half the Middle East thinking about joining the club. (Saudi Arabia! Morocco!!) It's striking that the countries that are pushing the hardest, like North Korea and Iran, are the ones that are most likely to come under a direct threat from the US. The west's nukes seem to be encouraging them to tool up, rather than deterring them; however, the difference between the way the US has acted in Iraq and Iran (or Korea) suggests that they are certainly succeeding in deterring us. If lots of countries of dubious political stability are going nuclear, we'd look pretty foolish making a unilateral decision to go in the opposite direction. Politicians hate looking foolish. But we shouldn't pretend that this week's decision will do anything to improve global peace and stability, or even to reduce the threat to the UK.
As far as I'm concerned, what Blair has announced is a plan to build three new nuclear subs for the US Navy. (Actually they'll probably build four; once you've done the expensive design work, it would be rude not to). It may have been a predictable decision, but it's still a sad one.
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