Stephen Hill at CiF posits some kind of equivalency between Greece’s budget catastrophe, and the ensuing debate about whether the solvent EU countries should bail it out, and California’s budget catastrophe, and the debate about whether the solvent US states should bail it out.

Apparently Greece isn’t that large a proportion of the EU economy, so no big deal – but California represented a whopping 14% of the US economy before it went bust.

California’s situation in some ways is more worrisome than Greece’s. Having a state that is one-seventh of the national economy in dire straits is a threat to the nation’s economic recovery. It is analogous to having Germany struggling instead of Greece, striking at the heart of Europe. California has been shaken by widespread layoffs and furloughs – the city of Los Angeles just laid off 1,000 more workers – and core social programmes have been slashed. Millions of low income children have lost access to meal programmes, and community clinics have been closed. Almost 3 million low income adults have lost important benefits such as dental care, psychological services and mammograms.

In addition, while both California and Greece are in major belt tightening mode, at least in Greece all families and individuals still have access to healthcare and a long menu of other social supports that Europe is known for. In California, even before the crisis millions had no healthcare, and now more have lost their jobs and their health insurance. Unemployment compensation is miserly, as is the overall safety net, which impacts consumer spending and further weakens the economy.

In this case, then, it was terribly mean of the Obama administration to deny California a federal bail-out paid for by the taxes of the other 49 states. That’s, like, super unfair, because:

But ironically California’s current plight may serve as a warning to Germany and France. Over the last several decades, California’s once thriving economy served as a kind of backstop for other American states. California has subsidised low population (and often conservative) states by only receiving back about $.80 for every federal tax dollar it sends to Washington DC. Californians have sent tens of billions of dollars to conservative states such as Mississippi, Alaska and North Dakota, which receive about $1.75 for every dollar sent to Washington.

Yet when Governor Schwarzenegger asked the federal government for a return on that long-term support, the White House shut the door and the Republican states long subsidised by California were unsympathetic. Memories are short, as is gratitude.

Leaving aside the question of optimal single-currency zones – which Hill never addresses – let’s look at this central point about the unfairness of leaving California to its fate.

For years, Hill says, California was the wealthiest state in the country, and the federal taxes its wealthy citizens paid subsidised the poorer, less populous states of the union. Now California has farked itself, allowing and encouraging its legislature to spend the state into massive debt – and wealthy California wants the poorer states to subsidise it!

Surely this is exactly what Guardian writers (and readers) loathe, the idea of the poor subsidising the wealthy? They certainly profess to hate incidences of it in the UK and cry that the transfer of money from poor to rich is a massive injustice (that will, no doubt, be further perpetrated by the Tories if they win the next election). California’s budget crash has not made the poor states it used to subsidise any wealthier; in fact, it’s probably made them poorer. So why in the world should the poor states make themselves even poorer because the people of California were happy to elect legislatures that spend like drunken sailors?

Somebody please explain to me why, suddenly, the Guardian is in favour of the poor subsidising the rich.

Nef is not calling for sudden or imposed change, but for a slow shift across the course of a decade or more. Wage increments can gradually be exchanged for shorter hours. There will be time to adjust incentives for employers, to discourage overtime, reduce costs per employee, to improve flexibility in ways that suit employees, and to extend training to offset skills shortages. There will be time to phase in a higher minimum wage and more progressive taxation, to change people’s expectations, and to adjust to low-carbon lifestyles that absorb more time and less money.

This plan makes no sense. Why do we need a higher minimum wage if we’re going to be spending so much less money on stuff? Where are the extra jobs going to come from if people are purchasing fewer goods and services? How many businesses will be available to hire people after you’ve bankrupted a bunch of them by forcing them to pay their employees more money for less work and by discouraging people from consuming the goods and services they produce?

In short, how stupid and totalitarian are you, really?

Seriously, just go away. Go away and stop telling me what to do.

For those who attribute basically good and selfless motives to government, consider this logic:

This sort of argumentation reflects a general double standard of morality that is always applied to State rulers but not to anyone else. No one, for example, is surprised or horrified to learn that businessmen are seeking higher profits. No one is horrified if workers leave lower-paying for higher-paying jobs. All this is considered proper and normal behavior. But if anyone should dare assert that politicians and bureaucrats are motivated by the desire to maximize their incomes, the hue and cry of “conspiracy theorist” or “economic determinist” spreads throughout the land.

From Rothbard, For a New Liberty

… to me. This blog is one year old today.

Via the Croydonian, this.

As bold plans go, this one is tres bold. Now obviously, districts within US states are redrawn after census so that each district contains roughly the same number of people.

But I have never heard anyone suggest that US states themselves should be redrawn after census so that each state contains roughly the same number of people. Considering that state boundaries are essentially arbitrary, I don’t find this particularly unreasonable. And it would certainly solve the problem of overweighted small-population states and overweighted large-population states.

However. For the moment, gerrymandering is limited to the states at the moment. Extending the temptation to gerrymander to the entire country, and putting that temptation squarely in the hands of the US Congress, is a very poor idea.

Additionally, redrawing state boundaries to make federal elections more efficient would play merry hell with state and local governments. In the US, state and local governments do actually do things, and are responsible for a great many competencies that would be sorely affected by altering the geographical perimeters of each state every ten years.

There is also the problem of revenues. Federal taxation would of course remain largely unaffected by this, but much of what state governments do is paid for by state taxation, be it sales, income, property, or some other form of levy. As you might expect, much of the wealth of the US is concentrated in urban areas and centers of high population, or else in areas where wealth-generating industries are located.

Look at the map provided:

redrawn states

This redrawing of states would create, I predict, revenue problems particularly in the South, which is the poorest region of the US already. The states labelled Pamlico, the Delta, Tombigbee, Brownia, and Pecos all represent the poorer areas of North Carolina, Tennessee, Mississippi, Alabama, Arkansas, and Texas. At the moment, these areas which generate little public revenue are all effectively subsidised by the wealthier parts of those states. Dallas and Houston especially pay for much of the public services in the rest of Texas. Redraw the boundaries in accordance with this map, and these poorer areas will see a drastic reduction in transport maintenance (roads especially), public education, and other state- and county-provided services such as law enforcement and rubbish removal. That, or they will be themselves subsidised by the federal government, putting them in hock to the rest of the nation like poor cousins fallen on hard times.

Now, one can argue that some of these competencies are things no government needs to provide, and maybe that’s true, but at the moment state governments do provide them, and there is little chance of that changing any time soon. The fact of the matter is that, at the moment, there are concentrations of wealth and population within states that enable those poorer areas to get by. Divide them from the sources of public revenue, and those poorer areas may become even more deprived. There is always a chance, I suppose, that those poorer areas might adopt reforms that would make them extremely attractive to businesses and industries, but experience (and cynicism) suggest that is unlikely.

Essentially, I do not think this is a good plan. It would be nice to have fairer and more efficient federal representation, but not at the cost of disrupting and in some cases even destroying the provision of state services.

From the Telegraph:

Republican leaders in Congress called for a reworking of the bill, which would provide near universal coverage and aimed to bring down long-term costs. But Nancy Pelosi, the Democratic House Speaker, argued that because Massachusetts already had near-universal health coverage under a state law, the vote should not be seen as a referendum on the issue.

“We don’t say a state that already has health care should determine whether the rest of the country should. We will get the job done. I’m very confident,” she said.

It’s because Massachusetts already has just such a health care system as the one Pelosi’s Democrats are proposing that the opinion of their citizens is worth more than that of any other state’s.

They know what it’s like. They know what it costs. And they know that if the Democrats get their retarded bill passed, the citizens of Massachusetts will be paying through the nose twice.

That’s one of the great things about the federal system, you see: experiments can be tried in the states that want them, and the results can be judged by the rest of the country as either worth duplicating or worth abandoning. Massachusetts has done the experiment the Democrats would like to foist on the whole country. Not only have the other states looked at Massachusetts and said, ‘Dude, that doesn’t look like it’s working out so well, maybe we’d better not try it here,’ the people of Massachusetts themselves have said, ‘This isn’t going so well for us! Don’t try it at home!’

I reckon Nancy Pelosi should take a long, hard look at what’s happened to the healthcare system in Massachusetts, if for no other reason than because costs there have skyrocketed beyond all expectation, and seriously reconsider whether she wants to push the same money-suck on the entire rest of the nation.

Unless, of course, she wants to go down in history as the Politician Who Bankrupted America. Because you can bet your sweet buttocks it won’t be Obama who gets blamed. A man who can rise to president from two years’ experience of national office and prior experience in a Democrat safe seat and in a Democrat safe state’s legislature is more than canny enough to figure out a way to let some other poor bastard take the fall.

DK rips into a leftie who appears to be claiming that raising the minimum wage to £7/hr (a ‘Living Wage’) will be good for workers and good for businesses. Like, automatically. Always. ‘Cause it’d sure be stupid to do it if it would make some people worse off.

Let’s experiment, shall we?

I own a widget factory.

I have 100 employees turning out widgets for £5.80/hr, 40 hours/wk, 52 weeks per annum.

My wages bill is thus £1,206,400 per annum. Add in Employers’ NICs, and that wages bill becomes £1,287,667.

Let’s pretend my factory is very cheap and costs me £25,000 per annum to operate.

Each of my widgets costs £1 to make; I sell each widget at £1.20 for a 20% (entirely reasonable) profit.

Fortunately I sell 1,500,000 widgets per annum, leaving me with a nice profit of £487,333 per annum. I share this equally with my three business partners, giving us each a yearly income of £121,833.25. Once I’ve paid Employers’ NICs, my own NICs, and income tax on this sum, I’m actually taking home £70,031.

Suddenly, the law demands I pay my employees £7/hr.

Now my wages bill is £1,569,216 per annum (including Employers’ NICs) plus £25,000 overhead.

Selling 1,500,000 widgets per annum, now my profit has shrunk to £205,784 per annum, which I share equally with my three business partners, giving us each a yearly income of £51,446. Once I’ve paid Employers’ NICs, my own NICs, and income tax on this sum, I’m actually taking home £32,800. In raising my employees’ wages by £1.20 each per hour, my own income has shrunk by more than half.

If my widget sales fall, my income becomes even smaller. If my overhead rises (energy bills go up, you know), my income becomes even smaller. If I want to offset this by raising the price of my widgets, my customers’ business costs rise (at a time when they have already risen, because they too have to pay their employees more); alternately, sales of my widgets fall. I realise I can earn more than £32,000 as a school teacher.

Best-case scenario, my business becomes more expensive to run, my customers’ businesses become more expensive to run, the prices of our products rise, and our incomes shrink.

Worst-case scenario? My partners and I sack our 100 employees and sell the factory. My employees are now earning £0/hr. My partners and I go off to teach maths to left-wing dunderheads who, despite our efforts, will never understand that occasionally, just occasionally, raising the costs of a business means it is no longer worthwhile to operate that business.

Tax figures found here.

All kinds of bizarre financing going on here, just to keep the airline above water* ‘through the global downturn in air travel.’

With everyone from Al Gore to British doctors insisting that we all reduce our carbon footprint – i.e., no flying for the plebs – and governments slapping green taxes on airfare left, right, and centre, I wonder just when exactly AA thinks passenger traffic is going to pick up again.

Especially when the service they offer is such utter, utter shite.

I myself used to be quite a loyal AA customer, in the grand old days of four years ago, when I could buy a ticket for a service from my local airport direct to Gatwick for $350 (incl. tax). I would fly on a not-obnoxious Boeing 777 and the flight attendants would bring me tomato juice with a friendly smile.

These days, you can’t buy a ticket like that for less than $1200, and the service flies to Heathrow instead. It runs on 747s (shite) with incredibly rude cabin crews who tell you off for getting out of your seat to use the toilet.**

Since the last time I flew on that dismal AA service (July), I have flown on the Virgin Atlantic service from DC to Gatwick (August). I did not mind in the slightest that I was routed through DC, because what I lost in time was made up for by VA, who outshine American like the sun outshines the moon. On the beautiful new Airbus with seat-backs designed to shift down and back rather than recline onto someone’s patellae, the flight attendants encouraged us to walk about the cabin to stretch, plied us with complimentary booze, and provided us not just with pillow and blanket, but also woolly socks, eyemask, and teeth-brushing kit. Need I emphasise that on most other airlines, those are things you only get in business class or better? And I was in economy.

And the whole thing cost me HALF of what I would have paid on American.

Needless to say, I wrote American a letter explaining all of this, and their eventual response was that they hoped to continue to provide me with good service. Ha! They only way I’d fly American again would be if they dropped their fare to $1 (incl. tax). For all those people whose ’shares in AMR jumped 18% on the back of the news,’ my advice to you is: sell up now, motherfuckers.

*You see what I did thar?

**Mind you, this is still better than Thomas Crook. But then, so’s a bowlful of steaming ordure.

I was standing at the counter in the chemists’ over the road this afternoon when my eye was drawn to a shiny leaflet displayed there. For a moment, I daydreamed, admiring the design and the pretty colours, the words ‘Brixton Pound’ turning my thoughts to a possible new club or home for rescue dogs.

Then, with an actual, physical start of surprise, I noticed what it was really advertising. The Brixton Pound.

Once I’d paid for my goods, I snatched up a copy of the leaflet and went out to the pavement to read it. Here is what it says:

WHAT?

The B£ is a local currency launching in autumn 2009. It’s a practical way for Brixton residents to support local traders and boost Brixton’s economy.

The B£ will work alongside pounds sterling – but can only be spent with independent local businesses within Brixton. Brixton will be the first urban centre in the UK to have its own currency.

WHY?

Your money goes further:

• Rewards and special offers for using the B£
• The B£ keeps circulating within Brixton – local people benefit each time you spend one

Good for the local economy, community and environment:

• Supports independent shops and local jobs under threat from the recession and larger chain stores
• Maintains the diversity and character of Brixton
• Localising trade helps cut carbon from transport

The B£ is secure:

• Printed on watermarked secure paper
• Backed by sterling held by Lambeth Savings and Credit Union

WHO?

The B£ is being launched by a group of local volunteers in partnership with:

• Transition Town Brixton (Community-led vision and action on Climate Change)
• Lambeth Savings & Credit Union (Lambeth’s financial cooperative)
• nef (economics as if people and the planet mattered – Lambeth-based economic think-and-do tank)

Please show your support by joining the B£ 1000 club. Membership is free and you will be one of the first 1000 people to use the B£ when they are launched. Visit www.brixtonpound.org to sign up.

Several questions leap to mind.

First, what is the exchange rate between B£ and £ to be?

Second, how exactly is that going to be determined?

Third, most traders in Brixton purchase their goods from outside of Brixton (I would guess). If the B£ is worth less than or as much as the £, how is it going to help them?

Fourth, most residents in Brixton earn their money in £. If the B£ is worth more than the £, how is it going to help them?

Fifth, if the B£ can only be spent within Brixton, the ‘diversity and character’ of what Brixton residents buy is going to shrink. You can’t buy a drink at a pub in Streatham with your B£. You can’t take a bus to Stockwell with your B£. What, in fact, will your B£ buy you? Locally-sourced goods from local traders. Which, in Brixton, is basically drugs. Hello, black market!

I’m not suggesting that alternative currencies are a bad idea in and of themselves; in many circumstances, I would argue, they’re necessary, especially when hyperinflation for example has devalued the official currency. They probably do this in Zimbabwe. But an alternative currency in a location like Brixton, that produces few truly ‘local’ goods and where most of the residents are earning their money outside of Brixton in pounds sterling, is at best pointless, and at worst, damaging to local traders.

I haven’t actually worked through it all in my head yet, however, so I’m willing to be told differently. I just thought it might be interesting for other libertarians to hear about this. Especially Tim Worstall.

Y’know, amongst all of this drama about banking and debt and monetary policy, I’m surprised no Catilina has turned up. He campaigned, unsuccesfully of course, on a platform of tabulae novae: that is, a general cancellation of debt. The proposal was, although manifestly stupid, very popular with a vast number of Romans.

The crisis of 63 BC was in part precipitated by Pompey’s re-opening of the markets in Asia Minor, two results of which were that debts in Rome were suddenly called in by creditors, and cash moved out of the city to places like Pergamum. This is, of course, one of the problems with the gold standard: how do those people advocating the gold standard now answer this dilemma?

Last Sunday, Madeleine Bunting wrote a piece for the Guardian that is simultaneously the most vicious and most thought-provoking essay I’ve read these many years. Tim Worstall, as usual, tipped me off, taking issue as he did with Bunting’s aside that neoliberalism and fascism have been destructive in contradistinction to communism and socialism, and while he is right to point up the hilarity of that assertion, it is but small beans in comparison to the rest of what she says.

She begins:

The certainties that have dominated the last quarter of a century – that the market knew best, achieved efficiency and produced wealth – have collapsed. Few would disagree with him, but the clarity of that conclusion is matched by the confusion about what comes next.

There is, within this statement, an apparent confusion about what, exactly, a market is. There shouldn’t be, because Bunting could reference a cosy view of life in the pre-modern era, where a market was a place where exchange occurred (village square, local goods stalls, bescarfed women with basketsful of eggs, etc.), but she doesn’t do this. And she is wrong not to, because that is what a market is even today: a space where information about exchange takes place. A market is a tool, an amorality: a perfectly-operating market is efficient, because it permits potential exchangers to learn the value of what they wish to exchange, and it does produce wealth, because that free information allows the parties to an exchange to maximise their mutual benefit. A perfectly-operating market, however, does not know best, because a market is a tool, not a party to exchange itself.

What has collapsed, and Bunting could have pointed this out easily, is the informative value of the imperfect market in which exchange has recently been taking place. This is, by and large, a corporate, capitalist market heavily interfered with by the state in the form of regulation, taxation, and subsidy (amongst other things). Such a market does not convey correct information – its worth as a means of conveying value is approaches nil, because true costs (in particular) are obscured by strictures outwith the market itself. This is not necessarily a bad thing – even the most strident advocates of free markets often admit the need for certain external strictures, especially in pricing externalities, QED – but more often than not, interference in the functioning of the market is performed imperfectly in the pursuit of goals many of us disapprove (public money being used to bail out corporate institutions being one, whether it’s the automobile companies or the banks or the shareholders of both; asymmetrical information in the operation of the banking system; etc.). It is the failure of this type of market that has given the lie to whatever ‘certainties’ we might have cherished for the last quarter of a century; but this is no more an intrinsic flaw in markets per se than the existence of greed is an intrinsic flaw of money (which is simply another tool in the process of exchange).

Bunting is right to ask, ‘What comes next?’, even though this question is a non-sequitur in the case of market fundamentalism, since what she goes on to explore has very little to do with the collapse of the politico-corporate market. But never mind that; what does come next?

In his last Reith lecture, on Tuesday, Sandel will call for a remoralisation of politics – that we must correct a generation of abdication to the market of all measures of value. Most political questions are at their core moral or spiritual, Sandel declares, they are about our vision of the common good; bring religion and other value systems back into the public sphere for a civic renewal.

So, in the absence of certainties about ‘the market,’ we need a new certainty, a new way of measuring value, though Bunting never addresses the obvious question: ‘Measuring the value of what, exactly?’ It becomes clear throughout the rest of her piece that ‘value’ is being used as a positive abstraction, standing in for some nebulous idea of satisfaction + happiness + equality + prosperity. ‘The market’ has failed to deliver that mixture; what, in its place, can do so?

But never mind that, either, because she’s not going to explore it. Instead, we return to the tired memes of ‘the common good’ and ‘civic renewal.’ There is an a priori assumption here that questions of politics, whether it be government or simple collective action, must have an answer that is geared toward achieving a common good. This assumption may not be such a mistaken one; I’m sure many people share the view that collective action exists exclusively to achieve collective good. What constitutes ‘the common good,’ however, is highly debatable, and is probably at the root of all political differences. If there were a set of easily-identifiable and self-evident commonweals, we would not need so much variety of political choice. (Whether or not we really have, at least in the UK of today, such a huge variety of choice is another question I’ll leave others to explore.)

The same objection applies to the belief that political questions are moral or spiritual. No one has yet, despite centuries of philosophers’ attempts, managed to identify a universal morality or spirituality, any more than we’ve identified a universal ‘common good.’ Morality – the distinction between right acts and wrong acts – is not absolute, even if we think it ought to be – even if some of us think there are absolutes – because there will always be intelligent minds who disagree, and whose reasoning contains no obvious flaw that can be corrected.

Bunting does seem to recognise this problem, at least on some level, because she focuses the rest of her argument on civic renewal; and it is easy to see why, since ‘few indeed’ disagree that civic engagement has ossified:

The problem is a near sense of desperation as to how this is to come about, as current prescriptions offered by all political parties are emptied of meaning and credibility. Meanwhile, politics is in danger of becoming a subject purely for a small technocratic coterie dominated by highly complex financial regulation and arcane detail of parliamentary reform. It’s a politics of credit derivatives and standing committees, which is a foreign language to 90% of the electorate.

The sense of the end of an era is even more pressing in the UK than in Sandel’s America because it has coincided with the final discrediting of a form of professionalised, careerist politics. But to general bewilderment, even twin crises of this magnitude are not prompting political engagement; the paradox is that they may generate anger but are not generating action. The possibility of change – of radically reforming the institutions that have so betrayed trust – is slipping between our fingers. Bankers resume banking their bonuses, politicians revert to party rivalries to elect a Speaker unlikely to command the crossbench support necessary for reform. And we are left pondering what it is that brings about change – crises are not enough, outrage is not enough.

This is a fairly good summation of the problems facing the demos. Crises have occurred; comfortable systems have been discredited; there is outrage but no action. I commend the author.

She does not, then, do what I would do, which is to ask, ‘Why is there no action, when there is obviously such a need for it, and a fertile ground in which it can take root?’

The reason she ignores this is because, in asking why no action is taking place, we encounter a new, and much more troubling, set of problems.

There is a perception that systems for acting do not work. We live in a democracy, and the legitmate mechanism for action in a democratic society is the vote, by which the demos choose their proxies in government on the basis of specific platforms; the proxies are expected to carry out these platforms or be replaced by new proxies. The demos is the master of its government; between elections, it can direct policy through petition, protest, and (though this is itself a problem) lobbying.

In this particular democracy, most of those avenues for acting have been closed. The demos has been ignored: government has taken action without its approval, from bailing out banks to nationalising rail lines to giving Fred Goodwin a pension (if you like) to setting up unelected quangos to regulate government behaviour (IPSA) to creating a surveillance state to cracking down on protestors… and the list goes on. Much of what the government (and remember, it is supposed to respond to the demands of the demos) has done in the past let’s say quarter of a century (since that is where Bunting starts) has shifted power away from the demos, and this is one of the factors that has so depressed civic engagement. The legitimate avenues for action are closed: action in the face of these developments would be akin to beating one’s skull against a brick wall.

To give Bunting a bit of credit, she does not suggest that democracy itself is an unassailable system of governance; as the Devil’s Kitchen has pointed out, democracy has many faults.

A necessary (but not sufficient) condition for change to occur, one might argue, is the belief that change can happen. There appears to be, instead, a desultory fatalism here which Bunting does not address, summed up in part by the uniquely democratic aphorism, ‘No matter who you vote for, the government always wins.’ As long as the entrenched institutions, whether government or corporate capitalism or what you will, continue to barricade the legitimate mechanisms by which change can occur, they grow ever more monolithic and unchallengeable. In such circumstances, righteous outrage at crises and failures will turn inward, because short of fomenting a destabilising revolution, ways of reducing the unaccountable power of such institutions are not truly present.

There are many who would claim that it is the complacency of the demos itself that has allowed this situation to come about: for even unaccountable monoliths are not entirely maleficent, and there will always be those who benefit more than they would do in the absence of such institutions. Unanswerable corporate capitalism has permitted many people to enrich themselves tremendously, often at the expense of others; a powerful and paternalist government has protected many people from the consequences of their own failures, often at the expense of others. There are also people who have enriched themselves without exploitation, and people who have been protected by the state from the consequences of others’ failures. It is the complacency of those who have benefited that has put a cork in mechanisms for change; appeals to self-interest have worked, and I would guess many people who have no experience of any of what I have just said still gamble that, one day, they might do. They don’t want to reduce the monoliths because they judge the possible future benefits of them to be greater than the actual present costs.

But the safety, comfort, and benefit that monolithic institutions provide comes at the price of being unable to alter them easily or indeed limit their acquisition of further power, even when they turn against you.

Having omitted the why of civic disengagement, Bunting still tries to present a solution, and this is where we discover (a) that her omission was deliberate, and (b) the true viciousness of her argument.

Battening on to some documentary-maker’s assertion that ‘what is paralysing the collective will’ is ‘the dominance of individualism,’ she says:

“What we have is a cacophony of individual narratives, everyone wants to be the author of their own lives, no one wants to be relegated to a part in a bigger story; everyone wants to give their opinion, no one wants to listen. It’s enchanting, it’s liberating, but ultimately it’s disempowering because you need a collective, not individual, narrative to achieve change,” explains Curtis.

His analysis is that power uses stories which shape our understanding of the world and of who we are, and how we make sense and order experience. Powerful, grand narratives legitimise power, win our allegiance and frame our private understandings of how to measure value and create meaning. They also structure time – they fit the present into a continuum of how the past will become the future. This is what all the grand narratives of communism, socialism, even neoliberalism and fascism offered; as did the grand narratives of religion. Now, all have foundered and fragmented into a mosaic of millions of personal stories. It is a Tower of Babel in which we have lost the capacity to generate the common narratives – of idealism, morality and hope such as Sandel talks about – that might bring about civic renewal and a reinvigorated political purpose.

The solution to disengagement, apparently, is a collective grand narrative. In her own words, then, let’s explore what a grand narrative might have to offer.

(1) Grand narratives legitimise power.
Rather than reducing the power of monolithic institutions, they entrench it. This is precisely the opposite of what the demos appear to desire, which is a return of power to the civic level, not a legitimisation of the transfer of power away from it.

(2) Grand narratives win allegiance.
They put a high gloss on failed, unaccountable systems in order to provide the illusion that those systems are both palatable and good. The allegiance here is an adherence to someone else’s vision, an abdication of self-determination in favour of a purpose imposed from the outside that may suit neither the individual nor the collective will.

(3) Grand narratives frame our understanding of value and meaning.
In other words, they change what we desire, rather than fulfill it. This is not changing the systems to suit the demos; this is changing the demos to suit the systems.

(4) Grand narratives structure time, fitting the present into a continuum of how the past will become the future.
They provide a comforting but impossibly teleological illusion of human development. As Bunting points out, this is what religions and modern political systems do. Historians (and I know whereof I speak) are fond of imposing teleological interpretations on the past: Marxist historiographers are particularly prone. Overlaying a narrative on the past implies that there is, or has been, an end toward which all human action has tended. Religions, similarly, overlay a narrative on the future, assuming a state of perfection or enlightenment toward which religious principles are the most perfect route. Although many religions place a great premium on the perfection of the individual soul, reaching the end state requires a collective effort, just as modern political systems do. But do we really want our political systems to share common characteristics with religion? In many major religions, those individuals who do not work in service to the collective goal, or do not achieve perfection individually, suffer punitive judgment; should our politics operate in this same way? Or should they instead operate according to mutual benefit, common agreement, and compromise? The religious edifice is built upon the idea of revealed truth, and access to that truth is controlled by the spiritual elite. Do we want our political edifice to be built upon revealed, unchallengeable truths, access to which is controlled by the political elite?

Throughout history, the mechanism whereby religion has maintained social control and its grand narrative is the restriction of information. Do we really want to emulate this in the political sphere? Ignorance may indeed be bliss, but to impose ignorance on the demos for any purpose whatever, no matter how noble it may appear to be, must be one of the summits of evil.

Bunting’s desire for a grand narrative is not about ‘civic renewal and a reinvigorated political purpose’; it is about retaining the monoliths whilst finding a way to ensure that the demos happily accepts, and even supports, their power. This is the insidious reason for why she does not address the root of disengagement and inaction: she does not want action, she wants acquiescence.

Curtis argues that we are still enchanted by the possibilities of our personal narratives although they leave us isolated, disconnected, and at their worst, they are simply solipsistic performances desperate for an audience. But we are in a bizarre hiatus because the economic systems that sustained and amplified this model of individualism have collapsed. It was cheap credit and a housing boom that made possible the private pursuit of experience, self-expression and self-gratification as the content of a good life. As this disintegrates and youth unemployment soars, this good life will be a cruel myth.

There are plenty of people around trying to redefine the good life – happiness economists and environmentalists, among others – and Sandel’s authority adds useful weight to their beleaguered struggle against the instrumentalist values of the market that have crept into every aspect of our lives. But Sandel’s call for remoralisation seems only to expose how bare the cupboard is – what would it look like? What reserves of moral imagination could it draw on for a shared vision, given that the old shared moral narratives such as religious belief and political ideology have so little traction?

Individualism, contrary to what Bunting seems to present here, is neither fragmentary nor dependent on consumerism. She is right in presenting it as a struggle for ‘experience, self-expression, and self-gratification,’ but this must be as defined by the individual him- or herself, often without regard for the much-vaunted ‘common good.’ And indeed, no attempt at ‘the good life’ succeeds completely, but the ability to make the attempt, and define ‘the good life’ for oneself, must exist; that, for most people, it does not is but another aspect of that fatalism that has muted the outrage.

And shared visions, shared moral narratives, are bad, not least because nobody has yet found one that can be shared by everybody. A shared vision is an illusion held in common that works only for those willing to be directed (or deceived) by it, and there are many. Understanding this is what led to Nietzsche’s philosophy of perspectivism. He was writing in the context of the grand narrative of Christianity, but the essence of perspectivism is that there is no universal truth, no universal reality: instead, there is only the personal perception of reality, and individually unique epistemologies as numerous as the number of individuals themselves. Many people have criticised this view as relativist, and indeed it is, but Nietzsche also allowed for ‘formal’ truths, which are developed organically through the intergration of many individual perspectives. Perspectivism is perhaps the closest we have come toward the repudiation of the grand narrative as a concept; grand narratives are possible, but only in the presence of wilful or imposed ignorance and the denial of the discrete, individual consciousness.

Bunting goes so far as to identify a possible grand narrative, which she does not like:

A new grand narrative will emerge, Curtis believes, admitting he is an optimist. But perhaps there is another aspect to our predicament. That the new grand narrative has already emerged and it is one of environmental catastrophe. Perhaps this reinforces the sense of political paralysis. That the only grand narrative on offer is so terrifying – of a world rapidly running out of the natural resources required to sustain extravagant lifestyles and burgeoning population – that it disables rather than empowers us to achieve political change. Terrified, we retreat into private stories of transformation – cosmetic surgery, makeovers of home and person – because we see no collective story of transformation we can believe in.

Fatalism rears its head again in the idea of a coming catastrophe that paralyses the will to change. I argue that this is merely an effect, not a cause, of civic disempowerment; it is again the belief that the changes we try to achieve are but minute struggles against the overarching immovability of monolithic institutions.

She finishes:

Every other modern narrative – communism, socialism, even those that were destructive, such as neoliberalism and fascism – laid claim to a version of the kingdom of God, a better world that would nurture a better human being. They were all narratives of redemption and salvation. All that we have now is apocalypse, and it is paralysing. How then can we build hope?

The kingdom of God, a better world and a better human being – what place have these ideas in political discourse? They are entwined with the desire for a grand narrative. This teleological view of human progress is the most paralysing of all views. Even if the goal is unknown, or not yet understood, it imparts a sense of finality and destiny that petrifies the individual and the collective mentality. We are moving toward x, perhaps diverging down erroneous paths, but the desire to reach x exists, and we must all surrender to it. If there is a goal, and we do not share it, what hope can there be for the dissenters? ‘Better human being’ returns us to the world of the moral absolute, a non-reality, and ‘narratives of redemption and salvation’ are especially frightening. Redemption is for those who have transgressed; salvation is in the gift of a higher power. Will we set up human arbiters of sin and human judges of righteousness in our new narrative? I repeat, what place have these ideas in political discourse?

It is a funny thing that ‘apocalypse’ does not mean what Bunting thinks it means. She infers from it chaos, destruction, collapse; but at its root, it is αποκαλυψις, an uncovering, an unhiding, a revelation. And perhaps what she hates about apocalypse is that is has uncovered mutable truths; it has removed certainties and replaced them with the understanding that certainty itself paralyses. The absence of a grand narrative is a state of being to be celebrated; it is both energising and liberating, bringing as it does the knowledge that we are not bound to a shared reality, a vision imposed on us by others. We as individuals can create our own meaning and give our own existence its purpose – and that purpose is whatever we choose, based upon whatever values we wish to hold. We can fight for self-determination even in a society that ritually denigrates the individual, ascribing its success only to the existence of the collective, and demanding gratitude and service in return. The paralysis is proof that that society is dying.This apocalypse is good, and recognition of our own paralysis is a vital step toward freeing ourselves from the tyranny of those who would make us pawns in their ‘narrative’ of social transgression and secular salvation.

Via the delightful Mr E, I see that Ed Balls, Minister for Fucking Up Your Children and Families, has got himself into trouble on multiple counts:

First, he told some great big whoppers on the radio about Labour’s budget bringing the national debt down, when in fact their very own budget shows the national debt rising. Fraser Nelson illustrates with some pretty graphs.

Second, when Balls got wind of Nelson’s article, he demanded it be taken down, practically causing Nelson to bust a kidney from laughter in the process.

Nelson says:

Balls was deploying the “false proxy” – one of the tools he and Brown use to mislead the public. The Brown/Balls spin technique is all about the gap between their verbal and financial positions. Debt is a classic case in point. Most people understand “reducing the national debt” to mean, well, reducing the national debt. Brown and Balls would claim to do this, when in fact they were increasing the national debt – but by slightly less than the growth of the economy. Orwell would have great fun with Brown and Balls – they have invented statistical doublethink. A way of describing ‘up’ as ‘down’.

Pretty sneaky, Balls. Pretty sneaky indeed.

Apparently, one of the things Balls said on the radio this morning was the following:

We have acted in the downturn, that will mean that the economy is stronger, we’ll have less unemployment, less debt. Therefore we will be able to spend more on schools and hospitals. The Conservatives have opposed these plans, the national debt will be higher with the Conservatives.

In the mind of the Man Who Would Be Chancellor, spending more = less debt and opposing spending = more debt. Excuse me while I ask, WTF. ‘The national debt will be higher with the Conservatives’? I grant that may well end up being true, but only because Labour have spent the last 9 months spending non-existent money like an overpaid benefits claimant in Asda.

Okay, wait, that was classist, wasn’t it?

Spending non-existent money like a teenaged geek with a stolen credit card in the Apple Store.

Whatever the simile, Balls has just proved that the level of political discourse is no better here than in my native land: ‘We rock, and the other guys are totes poo-heads. Am I right or am I right?’

One thing that is different, however, is the unbelievable fact that people win elections in this country by promising more public spending. Some of the electorate evidently want to wrap themselves in the cotton wool of this promise so badly that they’re happy just to hear it as bullshit, never mind it actually happening:

We don’t care if the commentators or the economists turn against us. This is all about shoring up the base in the northern heartlands, which we lost in the European elections. We don’t want or need them to understand the nuance of the argument. We just want them to hate the Tories again.

The equation being, of course, that the British hate spending cuts, and thus hate the Tories, yea even unto the Day of Judgment, Amen.

Whereas the Americans, as far as I can still tell, adore spending cuts, and have hitherto gigantically mistrusted anybody who doesn’t advocate them. Now, obviously, I’m well aware that Americans are being lied to also – no American government has managed actually to cut spending since, like, EVER – but the difference lies in the lies we wish to be told.

(Did you see what I did there?)

Americans want to pretend the government is spending less of their money than ever on less and less stuff. The British want to pretend the government is spending more of their money than ever on making the current stuff super-awesome.

I wonder what proportion of the US population pays income tax, versus what proportion of the British population pays income tax.

I bet it’s a smaller proportion here in the UK. Anybody have the data? I’m willing to be corrected.

What is it with the British government’s desire to honour this disgusting parody of a man? Is it because Gordon Brown increasingly resembles him? (Watch out, Sarah…)

The Royal Mint is issuing some special coins to commemorate the 500th anniversary of Henry VIII’s accession to the throne. The coins will feature the personal motto of this second son, intended for the priesthood and never meant to be king, who succeeded thanks only to the untimely death of his older brother, whose ‘virgin’ widow he married, cheated on, and ‘divorced’ in a move so emotionally and politically insensitive that it nearly provoked war with the Holy Roman Empire. For this he is given credit for founding the Church of England.

The motto in question is ‘Rosa sine spina,’ never an official royal tag line but Henry’s own bizarre self-description, that of beauty without defence. Pardon me while I ask, WTF?

And may I also point out that one of Henry VIII’s mottos is already on the bloody coinage? Fidei defensor. Why honour him further?

Anyway, bollocks to this stupid coin and commemoration. If there is one thing we can all be sure of, the one person guaranteed to be in hell with Judas, Brutus, and Cassius is Henry VIII.

As I explained in a previous post, one of the items I had to supply for my tier 1 application was proof of earnings; the Border Agency requires two separate documents that prove one’s income.

Because their ‘guidance notes’ are so Byzantine, before I made the application I rang the Immigration Enquiry Bureau to ask for clarification. The conversation went something like this:

Bella: I have here a letter from my employer and a P60 as proof of income. Do those count as two separate documents?

Chappy: Yes, yes they do.

Imagine my surprise, therefore, when on Thursday I received a letter from the Border Agency refusing my application on the grounds that a letter from my employer and a P60 are not considered two separate documents – both being prepared, as they were, by my employer.

After recovering from the Britney marathon, I rang the Immigration Enquiry Bureau on Friday morning. The conversation went something like this:

Bella: I have here a letter from my employer and a P60 as proof of income. Do those count as two separate documents?

Lady: (after putting me on hold to seek clarification) Yes, yes they do.

Bella:. Yes, that's what I was told when I rang this number before making my application. Why, then, do I have a refusal letter here informing me that, in fact, they are not considered separate documents?

Lady: (after putting me on hold again) I must apologise for giving you incorrect information, but as you will see in the guidance notes…

Bella: The guidance notes say nothing of the sort. That’s why I rang for clarification in the first place. You people have given me incorrect information twice now, and according to this letter of refusal, I have no right of appeal or review. You must see that the Border Agency itself is partly culpable for my mistake: what recourse do I have?

Lady: All I can suggest is that you write to the case worker who considered your application and explain the situation.

So I have written to my caseworker, and to my MP, in the hope that they will reconsider the original application if I provide a second document (bank statements) to prove that income, and if they consult their own recordings of telephone enquiries.

Because I cannot make another application. For one thing, I do not have another £820 to spare. (TGS, thank you for your very kind offer.)

For another, the application also requires that one has maintained a minimum bank balance of £800 for three months prior to applying. This was easy to prove when I made the original application; but in paying their exorbitant fee, my balance dropped to £780 – twenty quid below their minimum requirement, meaning that I would need to wait a further three months to achieve that minimum balance and re-apply. Unfortunately, that would mean waiting until September to make a second application, and my current leave expires 31 August.

And for another, for the tier 1 application, one can claim points for age. At the moment, I am 27 and so can claim the maximum number of points. In July, I will turn 28 – and thus lose half of the points I was able to claim for age on my original application.

The upshot is that, unless the Border Agency abandon their bureaucratic impulses and allow a reconsideration, or my MP takes pity on me and does something to assist me, I will no longer qualify to remain in the UK as a tier 1 migrant.

One other possible option is the tier 2 category – a work permit sponsored by my employer. This prospect raises another problem: that of proving that I am a better candidate for the job than any UK or EU national. Considering the specialised job I do, in theory this would be easy to prove. However, in order to prove it, the school would need to show that they had advertised the position with the JobCentre for some minimum length of time. Which, naturally, they did not do, because teachers do not look for jobs at the JobCentre. So the school may not be able to prove my superiority to native Britons and Europeans. The tier 2 permit also, apparently, requires the applicant to get an ID card. I’m not real pleased with the idea of doing that, as one can imagine.

Thus, there is very little I can do at the moment (although my employer and I are investigating the tier 2 possibility), and whether I can remain in the UK beyond the end of August is for the most part out of my hands and up in the air.

I am very irritated that, based on their own incorrect advice, the Border Agency has refused me permission to live and work here, especially since I can clearly support myself and will contribute to Britain’s economic well-being. I suppose those factors are simply not as important to the Government as indulging the bigotries, misconceptions, and protectionist instincts of a small number of the populace.

Some people over at the Devil’s Kitchen have suggested that marriage might be the answer and, having looked into it on a whim, it would seem that taking such a step would indeed take care of the immediate problem. Unfortunately, in reading the Border Agency website and this poor man’s horror story, I see that it would only suffice for two years, whereas the tier 1 application, had it been granted, would have lasted for three. Also, if I’m going to marry anyone, I want it to be for the, y’know, romantic and practical reasons – not because I need a visa. The very idea offends my ego.

Occasionally after work, Mr Smug Git and I repair to the local watering-hole and, lubricated by a pair of pints, proceed to sequester the pub’s copy of the Sun and roundly take the piss until (a) we run out of beer money, or (b) he has to get on the train back home.

Yesterday, most unusually considering the front pages of all the other newspapers in Christendom, the Sun carried no mention on its own front page of MPs’ expenses. Instead, the top stories were something to do with footballers being rude to referees, and this:

DD-Day: THE SUN’S campaign to axe the Marks & Spencer bra tax ended in a stunning victory last night.

‘We boobed,’ say Marks & Spencer. ‘In these times of economic trouble, we won’t charge £2 extra for Bras of Unusual Size.’

The Sun’s ‘Hands Off Our Boobs’ campaign, which I managed to miss entirely whilst it was being waged, appears to have championed a bizarre cause, but now that I think of it, hurrah for the Sun!

Because, for what is not a particularly complicated or cloth-intensive garment, the simple brassiere is one of the most expensive pieces of women’s couture. A rapid search of the M&S website ‘by price’ reveals that the most inexpensive bra they offer at the moment comes in at £8. (If one desires the matching knickers, it’s a further £3.) By contrast, one can purchase two tops for the same price, at £4 apiece.

Good on the Sun, I feel, for ensuring that large-busted women are not penalised by a £2 extra charge. It is bad enough that women fork out for these ridiculous apparatus anyway; those blessed (by nature or surgery) with generous chests shouldn’t have to pay even more for what is, let’s face it, two little triangles of cloth connected by a bit of cheap elastic and wire.

Somehow, however, I doubt the Sun will espouse the other women’s cause that is truly outrageous: the blatantly sexist charging of VAT, however reduced, on menstrual items that only women need – but not, let us remember, on things like Jaffa Cakes.

Tell you what, Ms. Harman: instead of championing economically stupid plans that actually hurt women (over-generous maternity leave, flexible working hours, shoehorning females into top banking positions a la affirmative action, etc), why don’t you take a page out of the Sun’s book and get this tampax tax eliminated?

Over on the Devil’s gold post, commenter Revolution Harry questions fellow commenter Ian B’s assertion that ‘getting more stuff is a Good Thing’:

Economic growth on its own is fine, though I take issue with your idea that ‘getting more stuff is a good thing’. Depends on the ’stuff’.

Ian B’s riposte is a thing of sheerest beauty:

No it doesn’t. People getting more of what they want is a Good Thing, period. If you have more stuff than you want, fine, get rid of it or even better give it to me. If you think there is some kind objective method of deciding what stuff people should have, and that they shouldn’t be allowed to have stuff that others decide they shouldn’t have, then I think that’s reprehensible.

Getting more stuff is what the western world and free markets are all about. Stuff is great.

I concur wholeheartedly: Stuff is great.

I must say also that the discussion taking place over that particular post is possibly one of the most interesting I’ve read in a good long while. I highly recommend it.

My own view of ‘money’ has always been extraordinarily simplistic. As I understand it (and please, no flaming: I admit in advance to ignorance and silliness), this is sort of where money comes from:

I make baskets. You make shoes. We decide, mutually, that two of my baskets are worth one pair of your shoes. When I need shoes, I give you baskets according to this formula, and the same holds true when you need baskets – you give me shoes.

Mordred breeds cows. You need Mordred’s cows to make your shoes; Mordred needs my baskets for feed. I give Mordred ten baskets; he gives you one cowskin; you give me five pairs of shoes. So far, so good.

But I don’t need all of these shoes, or at least not at the moment, and you need more cowskins than Mordred needs baskets from me. Not to mention that there’s also Lancelot the chicken-farmer, Guinevere the prostitute, and Gawain the lumberjack to add into the equation, which makes it all hopelessly complicated.

So together we agree upon a unit of substitution for all of this stuff, and call it a squeed. Every item we produce is worth so many squeeds – perhaps my basket is now worth 10sq. Now, however, I decide I’d quite like not only a pair of shoes, but also a half-hour with Guinevere. So I sell my baskets for 11sq – after all, I’m the only basket weaver in town – pocket my 1sq profit, and save it up to pay Guinevere 5sq for my half-hour on Thursday. Then Guinevere spends 3sq on a handful of eggs from Lancelot, and saves the remaining 2sq toward a nice pair of shoes.

The situation becomes even more complex, however. Supposing Mordred puts his prices up too, because he also fancies Guinevere and wants to purchase some of her time. Realising that she’s now in demand, she too can charge more. What if another basket-weaver arrives and sets up shop? Not everybody can weave baskets, true, but lots of people can be prostitutes – so Guinevere’s prices might come down again when Elaine comes onto the scene. All of these things change the value of my baskets, as well as how much my squeeds will buy me.

Finally, and most importantly, what is a squeed, and how many are there? If the supply is finite, it will recirculate stalely amongst the community and quickly accumulate in certain spots like scum on a pond; if it is possible to increase the supply, that too will affect squeedal value and the price of goods. Ideally, squeeds should be an item we can’t really use (why waste something useful?), and relatively rare, although not too rare; also, a squeed should be something we can get more of, but not easily. Gold is, therefore, a good substance from which to make squeeds.

On the other hand, gold is heavy, and the village over the hill uses it for roofing tiles. They might come and forcibly relieve us of the contents of our over-burdened pockets! Better to agree on an amount of gold to represent 1sq, create a worthless (to the other village) paper 1sq note, and keep all of the gold squeeds in a safe place, like under the mattress. As long as we always have enough gold to back up most of our paper squeeds, we should be fine.

And there, my friends, we must cease Bella’s Theory of Money, because we enter the world of fractional reserve banking, which is where my limited and child-like understanding of the monetary system ends. I hope you have enjoyed today’s episode of Arthurian Village Economics.

UPDATE: Ian B continues froody:

And thirdly, it is common to glibly say we’ve had enough growth now and we bally well ought to stop. Well, you might think you’ve got enough stuff, but I haven’t got enough stuff and the average subsistence farmer in Africa hasn’t got any fucking stuff at all, and it is reprehensible to tell him he can’t have any because of an imaginary infinitude on a misunderstood graph. We have vast potential for improving our productivity, absolutely vast. We’ve only been in the industrial revolution for about three centuries, not even that. There is shitloads left to discover and invent. How dare you tell people on the breadline they’re rich enough?

An Act to make provision for and about the temporary and specific waiver of contract law, the acquisition and nationalisation of pension funds relating to Sir Fred Goodwin, the carrying out of deprivation, the use of executive power and the acquisition of the means by which Sir Fred Goodwin was to be compensated; to provide for Commissioners and a tribunal of public opinion with functions and jurisdiction in relation to those matters, to the seizure of any and all such funds and related funds as unwarranted remuneration of failure, incompetence, and general arrogance; and for connected purposes.

[2nd March 2009]

Be it enacted by the Queen’s most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—

Evidently, in the opinion of Harry Reid (D), Senate Majority Leader, paying taxes in the US is voluntary, whereby ‘voluntary’ means ‘your employer doesn’t withhold the full amount owed.’ Because you can cheat on your taxes, says he, the American taxation system must be described as voluntary. He contrasts this with ‘many European countries’ where the full amount owed is withheld by employers. Because in ‘many European countries’ people do not file their own income tax returns, those systems must be described as forced taxation.

The interviewer really sticks it to him at 2.20. And what, may I ask, is this word ‘phrase-ology?’

[youtube=http://www.youtube.com/watch?v=R7mRSI8yWwg&hl=en&fs=1]

Just happened across an amusing fantasy in the Daily Mash, my favourite part of which is this:

But last night chancellor Alistair Darling was like: “Hang on a minute, how come it’s always us?…What does IMF stand for anyway? International Mother Fuckers?”…

An IMF spokesman said: “Do you really want to know why? Fine. Your banks were the entire basis of your economy and now they’re shite. Your currency is used bogroll, you don’t make anything of any value, you’re governed by clueless arseholes and 99% of your population is up to its tits in debt. That’s why.”

Mr Darling added: “Yeah, fair enough.”

I recalled suddenly that last night I had a dream about loss of supply, complete with a vision of Brown and Darling standing open-mouthed at the dispatch-box, staring at one another in horror until one of them says, ‘Automatic dissolution? That can’t be right! How come nobody told us…?’

But never mind; we must square our shoulders bracingly against the winds of ill fortune. Worse things happen at sea. And all is not lost: my father has just sent me an email that says, in its entirety, ‘I read this morning that the pound increased in value against the dollar; that should help you some.’

[bella goes away to ponder whether weak dollar at all related to this]

Via the ASI blog, a stimulus plan far superior to the one I proposed the other day.

Highlighted by Samizdata.net, this op-ed by Paul Krugman of the New York Times makes me wonder whether he is actually an idiot, or just a disingenuous fucktard.

The lovely peeps over at Samizdata flag up his logical and mathematical nonsense much better than I could, but I do want to take issue briefly with the question of how much the jobs created by the stimulus will cost.

Krugman says:

First, there’s the bogus talking point that the Obama plan will cost $275,000 per job created…The true cost per job of the Obama plan will probably be closer to $100,000 than $275,000 — and the net cost will be as little as $60,000 once you take into account the fact that a stronger economy means higher tax receipts.

The post over at Samizdata points out:

What about Krugman’s own estimate of $100,000 per job if you look at the program in a multi-year basis? He claims this cost from the extra millions of new jobs that would be created after the first year. As the cost of the program is $820 billion, this implies that he believes that the Obama plan will actually create over 8 million new jobs. If this is true, why is the White House claiming only 3 million new jobs from the plan? Making arguments based on the official claims of its government proponents, as the critics have done, are not deceitful as implied by Krugman. Well, not quite as deceitful as calculating costs based on an extra 5 million jobs that do not appear in the program.

So yes. There’s something dodgy with Krugman’s maths.

He needn’t have bothered, though; not being an economist, I’m not entirely certain of what he means by ‘cost per job created,’ but he makes a stupid mistake by engaging with this criticism in the first place. After all, is not the point of a fiscal stimulus to spend lots and lots of money? Does it really matter what it gets spent on or how much that thing costs?

To be absurdly simplistic: if the US government really wanted to, they could divide up this proposed $1 trillion and give an equal share to everybody. According to my handy calculator, and assuming I’ve done all the zeroes correctly, that comes to about $3300 for every man, woman, and child in the US. Exclude the children, and that equal share goes up. Stimulus accomplished. (I should point out that I’m not actually advocating this plan.)

And, contrary to what Krugman apparently believes, people do apportion their own money more efficiently and usefully than the government does. So every one of those $3300 apiece would be well spent.

But my knowledge of economics is minimal, and my mathematical skillz permanently arrested at the level of a 14-year-old, so I’ll leave the rest of Krugman’s article aside for now.

Except for this, which is the part that bugs me:

As the debate over President Obama’s economic stimulus plan gets under way, one thing is certain: many of the plan’s opponents aren’t arguing in good faith. Conservatives really, really don’t want to see a second New Deal, and they certainly don’t want to see government activism vindicated. So they are reaching for any stick they can find with which to beat proposals for increased government spending.

(1) ‘Conservatives really, really don’t want to see a second New Deal.’ The way this statement is phrased makes it sound as if the New Deal saved the nation; conservatives don’t want it; ergo they don’t want the nation to be saved. Presumably, in Krugman’s mind, this is not because they have anything against the idea per se, but because they don’t want the credit for doing it to go to Obama. Is this ‘arguing in good faith’?

(2) ‘They certainly don’t want to see government activism vindicated.’ Naturally they don’t. Once the power and reach of the government grows, it’s very difficult to scale it back again; doing so takes someone like Margaret Thatcher, and observe how beloved she is by the British! Observe how long her achievements lasted! Any American conservative who truly believes in limited government (and there are few of them these days) must oppose the stimulus, whatever its plausible merits, on principle, because it extends the competency of the federal government far beyond what it ought to be.

There is a third problem with his remarks, and that is the latent advocacy of bipartisan consensus. In times of crisis, supposedly, partisan squabbling weakens a nation and saps its confidence. Whatever their opinion of the stimulus, Krugman seems to imply, its critics should suck it up and present a unified front with Obama, because to do so will improve the mental outlook of the country and bolster confidence in its public servants.

As my brother would say, fuck that shit.

I want partisanship. I distrust consensus. I want the party without power to throw every question, argument, and criticism it can come up with, no matter how sly, at the party in power. I want debate – robust, contentious debate. Why? Because without it, the electorate are deprived of choice. And times of crisis are precisely when conflict and argument are most necessary, as crises are exactly when governments are most liable to implement the most illiberal policies.

Today comes the news that yet another Obama appointee, Nancy Killefer, finds herself in a spot of embarrassment over her taxes.

First, we had Timothy Geithner, Treasury secretary nominee, who:

didn’t pay Social Security and Medicare taxes for several years while he worked for the International Monetary Fund, and he employed an immigrant housekeeper who briefly lacked proper work papers.

The article also cites ‘a series of other tax matters,’ but declines to describe them in detail.

Then, we had Tom Daschle, who ‘made mistakes on his taxes‘ to the tune of £120,000 and has now withdrawn his bid to become Heath and Human Services secretary. He said:

“My failure to recognize that the use of a car was income and not a gift from a good friend was a mistake,” said the former Senate majority leader. “When I realized the mistake, I notified officials and I paid the tax in full.”

I am floored by this statement, mainly because I have never heard of anybody having to notify the IRS of money owed. Three years ago, the bastards tracked me down in a foreign country to collect from me (and I know this because I’m consulting their threatening notices now) back-taxes of $13.16.

Nancy Killefer, picked to become Obama’s chief performance officer, has withdrawn her name from consideration for the post, ‘citing unspecified problems with District of Columbia unemployment tax.’ God only knows what that’s all about, but I’m sure it wasn’t that she overpaid.

What the fuck are these people playing at? Are the American people really supposed to believe that a string of tax irregularities in highly-placed Democratic officials is the result of coincidental mistakes and oversights?

Iowahawk has this to say:

Here at the IRS, we realize that many well-meaning taxpayers like you can be distracted by various family illnesses, baseball pennant races, political campaigns, and so on. The rules for late filing can be surprisingly flexible if you have the right qualifying circumstances. According to IRS guidelines, you are eligible for the 306(b)(19) “I Forgot” amnesty if the following applies:

(1) Your total adjusted gross income in the “I Forgot” years was equal to or greater than $8,528,000; and
(2) You are a nominee to head a cabinet-level federal agency.

If you answered “yes” to (2), or both (1) and (2), then you are in the clear. If you answered “yes” to (1) but “no” to (2), mail 10% of the total to the Democratic National Committee and request a cabinet appointment. If you answered “no” to both, then I’m afraid you are shit out of luck. Turn yourself into your local IRS authorities, who will assist you in computing appropriate penalties, interest, and parole terms.

UPDATE: I’m not the only one who thinks this is fishy. There seems to be a suggestion that Daschle in particular has withdrawn in order to keep Obama from looking bad. I must say, I’m impressed: self-flagellating politicians falling on their swords to preserve the reputation of one of their own? Repent, for the End is nigh…

Mr Smug Git at work left a note on my desk this morning containing the following information:

(2002) US health expenditure: $5267 per capita, 14.6% GNP
(2005) UK health expenditure: $2598 per capita, 8.2% GNP

(2006) US life expectancy: 75.4 (male), 80.7 (female)
(2005) UK life expectancy: 77 (male), 81 (female)

It would seem that Americans spend more on healthcare for less result than the UK, thus making the UK system ‘more efficient.’

I’m going to assume these figures are genuine, although I don’t know where they come from and I haven’t the time at the moment to verify them; but I’m puzzled. Does the US per capita figure include spending on health insurance? And if so, how much of that actually gets spent on healthcare provision?

Points to ponder…

UPDATE: A bit of interwebs-wandering has led me to a 1999 study published in the New England Journal of Medicine. Amongst other things, the study itemises administrative healthcare spending. About insurance overhead, it has this to say:

In 1999 U.S. private insurers retained $46.9 billion of the $401.2 billion they collected in premiums. Their average overhead (11.7 percent) exceeded that of Medicare (3.6 percent) and Medicaid (6.8 percent). Overall, public and private insurance overhead totaled $72.0 billion — 5.9 percent of the total health care expenditures in the United States, or $259 per capita (Table 1).

Presumably the $46.9 billion the private insurers ‘retained’ in 1999 represents (a) the cost of operating the company and (b) profit. I see no problem with this; insurance companies are meant to generate a profit. If they didn’t, they wouldn’t exist.

There is also this 2008 paper from the US Congressional Budget Office, which analyses the relationship between new technology and healthcare expenditure. It defines new technology as:

changes in clinical practice that enhance the ability of providers to diagnose, treat, or prevent health problems. Technological advances take many forms. Examples include new drugs, devices, or services, as well as new clinical applications of existing technologies (providing a particular service to a broader set of patients, for example). Other technological changes are newly developed techniques or additions to knowledge.

The paper goes on to examine a handful of new treatments: revascularization for coronary artery disease, renal replacement therapy for kidney failure, bone marrow transplantation, joint replacement, diagnostic imaging, and neonatal intensive care.

But here is the key paragraph:

Advances in medical science during the past several decades have greatly increased the set of available medical services, allowing practitioners to treat patients in ways that were not previously possible. Most health policy analysts agree that the long-term increase in health care spending is principally the result of the health care system’s incorporation of these new services into clinical practice.

So, part of that massive difference between US and UK health expenditure is, first, the involvement of profit-making insurance companies in the US, and second, the development of and increased access to new treatment technologies in the US. Do those things count as ‘inefficiency’?

And as for the delightful NHS – if it is so efficient, why does this piece exist? And this?