Tuesday, 9 December 2014


Ralph Musgrave  left a new comment on "Nigel Farage fails to get a round in because of immigrants":

Farage has a point in a very indirect way, as follows.

If a country has the optimum supply of infrastructure, and it knows that large numbers of immigrants will arrive in the near future, then EXISTING residents of the country have to pay for more infrastructure in preparation for the new arrivals: else the country will have inadequate infrastructure when the new people arrive.

Then on arrival, the new residents do not have to make any special payment re their share of infrastructure costs. And at a guess that will be several tens of thousands per head. (London spends £2,700 per head per year in infrastructure, never mind the ACCUMULATION of infrastructure capital or assets over the decades).


1. Farage was talking specifically about roads (the M4). The total amount spent each year on roads and road building is in the order of £10 billion. The total amount of tax paid by motorists (fuel duty and VAT on fuel; VAT on cars and repairs; Vehicle Excise Duty etc etc) each year is in the order of £40 billion - £50 billion a year.

So all those mythical immigrants clogging up the M4 are - like all motorists - paying for the cost three or four times over.

2. Public transport in London is a slightly different issue; only about half the cost is covered by ticket sales (immigrants pay their fair share of this). The rest of the cost is indeed subsidised. But those who are not paying their fair share are landowners, especially those with rental income. The rental value of a home in London is to a large extent a function of transport spending. Shut down public transport in London and "the city" would cease to exist, it would just be a collection of villages.

Immigrants - like everybody else - have to live somewhere. Those who moved here recently will be largely renting, ergo they are paying in full for the value of public transport, which is far in excess of the cash cost (or else it would not be worth doing). Those who moved here a while ago might be landowners, but so what? They will have paid their share of other taxes.

3. On the level of an individual with a limited lifespan, it sort of makes sense to distinguish between large, one-off acquisitions ("capital") and current spending. But "the government" is to all intents and purposes is immortal, the grey area between "capital" and "current" expenditure is so large that you might as well treat it all as current. To do otherwise is double-counting.

4. "Build it and they will come". Roads are clogged up even in areas where there are very few immigrants. That's just human nature. Build more roads and people drive more. Or more people drive. Commute times have not significantly changed over the centuries; if you can speed up traffic, people just travel longer distances.


Lola said...

RM posts all over the place - Cobden Centre, ASI, Mises etc etc and most of what he says varies between 'realising when you get to the end that you have just wasted x minutes of your life' to 'mostly gibberish' or 'that's bleedin' obvious'. Much like my own efforts really.

But that is the beauty of the web. You get to meet and talk to all sorts of people with all sorts of opinions. It's the best education 'system' yet devised.

The Stigler said...


You're too modest. It's all gibberish.

(I kid, you're mostly posting good stuff here).

Mark Wadsworth said...

L, TS, oh he's all right is Ralph, problem is he is one of the hard core who blames immigrants for nearly everything.