Wednesday, 31 October 2012

In which the Charity Commission becomes a lawmaker...


I'm inclined to side with the Charity Commission in this matter except for one minor point. It isn't the Commission's job to define the law:

“This decision makes it clear that there is no presumption that religion generally, or at any more specific level, is for the public benefit, even in the case of Christianity or the Church of England. The case law on religion is rather ambiguous.  Our view is that the definition is rather dated, and it is our job to define it adequately.

If there is a case for removing charitable status from religion then that is a matter for Parliament not the Commission.


Heseltine was wrong in 1982, wrong in 1992. He's still wrong in 2012.


I don’t know where to start with Lord Heseltine’s review. Perhaps with the bits I agree with – elected mayors, for example. Or maybe with a witch’s warning about reviews that everyone seems to ‘applaud’. But I’m choosing instead to begin with the big fib that Heseltine starts with -  his claim that the proposals are innovative, radical & different.

If there is an upside to the worst economic crisis of modern times it is the emergence of an audience for deep seated and radical proposals. They distrust talk of isolated initiatives or quick wins. An ever more competitive world will only become more competitive not less. The structures and attitudes of yesterday did not work that well then and certainly will not cope with the new world order.

All this may be true but Heseltine doesn't offer "deep seated and radical proposals" but exactly the things he disdains - "the structures and attitudes of yesterday..." 

Anyone who has listened to Lord Heseltine over the years will know that the themes of his thesis remain constant. The specific context of these particular proposals may be different from that led to the urban development corporations in the early 1980s or to “City Challenge” in the 1990s but the prescription remains the same.

Competitive bidding:

All my experience confirms that competitive funding is key to unleashing the entrepreneurial spirit in local areas. It injects a surge of excitement and incentivises communities to seek a wider and much more ambitious vision to anything they had thought of before. A healthy rivalry between areas comes into play. It drives collaboration, creativity, commitment and ambition. I therefore believe that the single pot of central government funds for economic development should be made available to local areas on a competitive basis.

Plan-led investment:

The Government will need to set out the requirements that LEPs must meet in their bids to secure funding. It should consult LEPs, local authorities and the business community in doing so. It is important that this framework is focused on high level outcomes and does not become detailed and prescriptive. This would rein in the creativity of local areas and undermine the benefits of local empowerment. However, there will be some essential criteria which have to be met for government to devolve such significant funding.

Sidelining local authority planning departments:

LEPs should therefore be given additional funding, specifically to develop their new strategic plans. This must be used to hire professional private sector planners as part of a deliberate attempt to spread best practice, engage private sector expertise and avoid LEPs being entirely dependent on the already stretched planning departments of their local authorities.

Cross-department regional offices:

This leads to the conclusion that we should bring together civil servants from different departments whose work impacts on the economy into Local Growth Teams so they can work seamlessly together, closer to the people and agencies affected by their work. They should facilitate both economic development matters that straddle LEP boundaries and partnerships around and between functional economic market areas

These tired old policies are accompanied by a familiar litany of how business-style public sector management is need, how economic development is driven by “innovation strategies” and some ridiculous obsession with “British ownership” as if that is somehow significant in our economy. What Lord Heseltine presents is simply his inevitable dirigiste, managerialist vision of how government should be organised. And it’s presented with panache and conviction.

The problem is that this agenda failed to regenerate the North when Britain was booming. Why on earth does anyone think that this agenda will regenerate the North when Britain isn’t booming? There is nothing at all in Heseltine’s prescription that will take us one inch neared a more dynamic, entrepreneurial economy. Instead we’ll have an economy designed and run by a closed sect of business managers working hand-in-glove with a closed sect of public sector managers.

In the end these are tired old proposals from a delightful and eloquent old millionaire. They are policies that haven’t delivered regeneration when they were tried before – except for some shiny city centres. But ask yourself this. Those city centres – Manchester, Liverpool, Newcastle, Leeds – have they delivered regeneration for the wider community? Travel a few hundred yards to Newton Heath, to Harehills, to Kensington and look around you. That depressing place of high unemployment, poor education, rampant crime and unshiftable poverty wasn’t changed when Heseltine’s policies were tried before. What makes you think it will work this time?


Tuesday, 30 October 2012

Mike Bloomberg is more of a Bonapartist than a liberal - even an American liberal


Alan Massie in the Spectator - while explaining that Mike Bloomberg is a "liberal" (or at least not a Republican or a conservative of any sort) - reminds us that Bloomberg is the Bonaparte of nannying fussbuckets:

Hell, all this and I haven’t even mentioned Nurse Bloomberg’s War on Tobacco which is, of course, really a reminder that he’s not one of those politicians who respects other people’s property rights.

Not to mention, of course, Bloomberg's campaigns against portion sizes, fizzy drinks, the wrong sort of alcohol and much else beside.  Anyone who believes that Bloomberg is in any way admirable as a politician (and I inclde Boris Johnson on that list - his puppy dog fandom of Bloomberg is quite depressing in an otherwise splendid politician) isn't someone I'd be cheering for.

We - as conservatives and believers in freedom - should be cursing the Bloomberg approach - ban this, stop that, controls, regulations. Sadly it seems that people I thought loved freedom - like Ian Martin - would prefer a tin-pot little bonapartist like Bloomberg in charge.


Science and growth. It really isn't as simple as all that...


Science is wonderful. I'll sign up to government investing in basic science every day. But I don't think it's a growth panacea. Lots of people do though:

The private sector can’t do it alone. We rely on companies to translate scientific discoveries into products. But federal investment in research and development, especially basic research, is critical to their success.

Now the author of those words is a physics professor and former scientific advisor to President Clinton so we might say he has an interest. But his view is widely held - investment in science, technology and maths by governments is a surefire route to growth. The problem is that there's precious little link (at least in the medium term) between investment in basic science and economic growth.

You see folks. Spending money on scientific research in universities doesn't cut the mustard as a growth strategy. A while ago in a different circumstance I wrote this:

We need, therefore, to examine what other (ideally measurable) inputs might improve our assessment of innovation.  Some authors identify ‘learning-by-doing’ as a factor in innovation (Iyigun 2006) while others argue for exogenous factors such as the size of the (innovating) population (Jones 1995).  This latter measure suggests that a better proxy for innovation activity might be the number of ‘knowledge workers’.  Such an approach would capture R&D workers and other workers involved in innovative activities. 

It seemed to me then that government is better placed investing in creating scientists, engineers and mathematicians rather than spending money on basic research in those subjects. At least if they want to generate growth. And for those regions that want to shift their economies they need to get lots of these people to live and work there. That means they aren't stuck with the one employer of those skills or forced to flit from one end of the country to the other so change jobs. And more importantly there will be plenty of people to partner with in developing and actioning innovative ideas.

This was a central failing of the UK's Regional Development Agencies (RDAs). All of them had innovation strategies but all of these strategies were, in effect, captured by higher education. Rather than focusing on innovation in business the RDAs spent their cash instead on funding research institutes and university-led strategies sited too close to their research.

There is evidence to suggest that university-led innovation strategies focusing on collaboration and the spinning off of businesses from HEIs leads to a misplaced focus on scientific research rather than business growth (Jones 1995, Frenz & Oughton 2005).  Perhaps the most effective way to generate effective innovation at the level of the firm (where it has a direct impact on economic performance) is to reduce the barriers to innovation.  The biggest of these barriers is cost and econometric models suggest that reducing innovation costs is more effective that investing in R&D or building innovation networks and systems (Martin 1999).  

In the long-term scientific research does help drive the technological advances that lead to economic growth. The problem is that, in the short- to medium-term, it's very difficult to spot the beneficial effects of such research especially when compared to the promotion of in-firm innovation.

References (yay, I don't do this often!):

Frenz M. & Oughton C. (2005), ‘Innovation in the UK regions and devolved administrations: a review of the literature’ presentation of report for DTI and ODPM, London, DTI

Iyigun M. (2006), ‘Clusters of invention, life cycle of technologies and endogenous growth’ in Journal of Economic Dynamics and Control, Vol. 30 pp687-719, New York, Elsevier

Jones C I, (1995), ‘R&D-based models of economic growth’ in Journal of Political Economy, Vol. 103 No. 4 pp759-783, University of Chicago

Martin P. (1999), ‘Public policies, regional inequalities and growth’ in Journal of Public Economics Vol. 73 pp 85-105, New York, Elsevier


Monday, 29 October 2012

Nineteen-year old pop star smokes shock!


The nannying fussbuckets are in full rant over Bradford pop star, Zayn Malik:

The 19-year-old, of Bradford, was pictured dragging deeply on a filter cigarette while he and the lads from the globally-successful band were in London.

Unshaven and in a trademark black leather jacket, Zayn’s habit sent out all the wrong messages, said Eileen Streets, director of tobacco control for Roy Castle Lung Cancer Foundation. 

Last time I checked it was legal for a nineteen-year-old to wear a leather jacket and have a day or two off shaving. As well as for him to smoke.


A thought on manufacturing...


I visited a manufacturer the other day. Part of a multi-national business in the electronics industry. Big plant in Chadderton employing about 360 people.

Of those 360 people, 54 have PhDs and over 70% have a degree of some sort.

Rather makes the point that, even if we have a boom in manufacturing, it is't going to provide jobs for 16 year olds who have scraped five GCSEs.


No self-interest here at all then?

What do you think?

A new support service for charity chairs is aiming to launch in the spring.

The proposed organisation, which is likely to be called the Institute of Chairs, is intended to serve as a source of support and information for charity chairs and help to improve the workings and governance standards of charities.

The organisation is being set up by the governance consultants Ruth Lesirge and Rosalind Oakley, and was unveiled at a meeting at the Charity Commission’s offices in London earlier this month.

Does look just a little like a ramp for a consulancy! (And please no jokes about "charity chairs"!)


Saturday, 27 October 2012

So why do ASH - and the EU - and the WHO - want e-cigs banned?


Perhaps it's because they're not controlled by their friends in the pharmaceuticals industry? Whatever, it certainly isn't because they don't work:

What sets e-cigarettes apart from other non-traditional nicotine delivery systems is that it has a high conversion rate, meaning that ‘smokers’ are less likely to return to regular cigarettes—a trend not enjoyed by other non-burning nicotine outlets like patches...

A clue comes from the latest piece of deranged ideological nonsense from the World Health Organisation:

...Parties may also wish to consider whether the sale, advertising, and even the use of electronic cigarettes can be considered as promoting tobacco use, either directly or indirectly. Regardless of whether or not ENDS contain nicotine or tobacco extracts, they are used to mimic smoking, which could be considered as a (direct or indirect) promotion of tobacco use."

That's it folks - e-cigs mustn't be allowed because using them looks like smoking. It doesn't matter if thousands of smokers are escaping the damage of cigarettes through 'vaping'. It looks like smoking and might:

"...undermine the denormalization of tobacco use."

We truly live in a mad world when a product that can help people quit smoking is banned because it looks like smoking.


Friday, 26 October 2012

...a reminder of neo-conservatism's curse


Neo-Conservatism, bastard child of the ghastly Kennedy administration in the USA, has a lot to answer for and this is a reminder:

...on the death of George McGovern. The best thing you (Wall Street Journal) could find to say about him is that later in life he learned about the burdens of government regulation of business. But many conservatives and libertarians who love the free market as much as you do also value and praise him for his opposition to the ultimately pointless war in Vietnam. The war was an indirect cause of inflation, price controls and, most importantly, the loss of life of too many Americans (and Vietnamese) of my generation.

Those who know the subject of my first degree will understand that this story - the terrible catastrophe of Vietnam - really matters to me.  Sadly America repeated the mistake - in Afghanistan, in Iraq, in Libya.

Pray god (if there is one still watching) that America won't make the same mistake in Syria or Iran. Or anywhere else for that matter.


Libertarianism is a political programme not a set of economic policy options


The thing with criticisms of libertarianism is that people fail to understand that it is a political project - a desire to break the state and rebuild a free society - not an exercise in economic choice-making. Hence this:

...if Johnson had been president in 2008, he would have allowed the U.S. financial system to collapse and the country to fall into depression. And if he became president now, he would do his best to strangle the tepid recovery we are enjoying and turn it into another severe recession.

Perhaps but the author is trapped inside and can't see the label on the jar that says "Government Jam - contains no freedom". As with other proponents of national account mathematics as a replacement for economic thinking, this author cannot see that the supposed "solutions" from the US government (and for that matter our government here in the UK) merely stir the 'Government Jam'. Voices will say that lessons have been learnt and that the banks will be controlled but is this not simply to repeat past errors?

Firstly, why is it said that banks cannot be allowed to fail? Are these institutions of state or businesses? If they are the former then why were they allowed to operate outside the direct control of the state? And, if the latter, why are the rules different from those applying to other businesses? If we believe in a free system, then businesses - including banks - must be allowed to fail. Those who argue otherwise do not support or believe in freedom and might as well just toddle off and join the Marxists.

Secondly, when did we decide that the government's job was to "run the economy"? This viewpoint now dominates economic thinking - or rather what passes for it within the corridors or power (and the organs of crypto-fascists like Bloomberg). Again, if we believe in freedom then it is mistaken to believe that government can "run the economy" without curtailing that freedom. And, moreover, the idea that something as complicated as the US economy can be "run" by anything or anybody is hubris. Yet the view that the economy is an institution as opposed to a system still corrupts our thinking:

Speaking in purely descriptive and functional terms, the distributive institutions of society are what makes any given bit of money “your money.”

The flaw in this argument is the same flaw that drives the economic policies of national and international governments and organisations - that the economy is an institution to be managed not a system to be used.

Thirdly - and finally - this entire argument echoes this famous dictum:

"All within the state, nothing outside the state, nothing against the state."
Without the state there can be no freedom. Without freedom there can be no prosperity. Therefore the state must be everything. Today this is achieved through dominating consumption through public spending and through the exercise of regulatory control rather than through the more brutal methods preferred by the man whose words are quoted above. But the object is the same - a directed, corporate state under the control of technocratic experts.

In the end libertarianism is a political project setting itself against the established institutions. And it does so because those institutions corrupt the effective operation of the free system. For sure, the proponents of state orthodoxy claim that we are not to be trusted with free enterprise, free trade and free speech (merely moderated shades of these things).

If you reject this system of the world - controlling but failed once and failing again - then you must argue either for the forcible end of free markets or for the advance of liberty. There are some - proponents of the idea that all the money is government's bounteously scattered upon the infantilised masses - who want a totalitarian state of courageous proportions.

Libertarianism is a political idea not an alternative approach to the failed economics of the establishment. If people fail to appreciate this and treat it as just another set of policy options then they are missing the point. The banks should be allowed to fail because to bail them out is an act of corruption, the protection of the wealthy from the consequences of their mistakes. Government's exist as protectors - guarantors if you will - of rights and freedoms not as managers of the economy.

I remain sceptical of this creed - it tips a little towards an anarcho-capitalism I'm sure can't work - but I'd rather take the risk of heading this way than remain in the seemingly inevitable spiral towards state control that current policies imply. I do not wish to live in a world where liberty and choice are limited by government - doled out like sweeties as a way to keep us content but removed whenever those choices or liberties threaten the institutions where power sits.