Glasgow Declared New Scottish Capital in anticipation of September Liberation

Well, by the Guardian at least (they amended the web version) 

Scraping the barrel (special brew edition)

The Guardian report on Stagecoach's foray into new and unloved markets:

From 5 September Megabus will offer passengers their own berths on an overnight service between London and Glasgow. Each of the berths, which are laid out in sets of three with just a curtain for privacy...

...Although Megabus operates at the no-frills end of the travel market, passengers on the sleepers will receive a free overnight pack containing a toothbrush, toothpaste and an eye mask...

...Coaches will run seven nights a week in both directions, leaving Glasgow at 23:15 and arriving in London at 07:20, and departing from London at 23.59 and arriving in Glasgow at 8:05...

...It may lack some of the romance of catching the train, but tickets for the service start at £1, plus booking fee...

"Skooz me Sir, saury to borthur yu, Arm trahin ti git a pund torgethar for the Megabus Express"

Fairly interesting...

From an article in The Daily Mail a few weeks ago:

Consumers are being hit by a 'postcode lottery' in the cost of buying goods, with some paying at least £500 more for exactly the same items. A study of the prices of 200 items at 12 different locations nationwide revealed that some shoppers are being ripped off and paying up to £537 more than in other areas. Researchers compared the cost of electrical products, homeware, stationery, toys and entertainment.

The average cost of the 200 items came to £15,508 in Swindon, in Wiltshire, and £14,971 in London. Swindon was the most expensive shopping destination in the country with prices £171 above the national average, website Kelkoo discovered.

In Wrexham, north Wales, and Peterborough, Cambridgeshire, customers were paying £164 and £148 above average. Remarkably London, despite its high cost of living, has the cheapest retail prices in the country, with the goods costing £366 less than the average, according to the report. The cost of electrical goods alone was £445 lower in London than it was in Wrexham...

Now, we don't know how rigorous the research was, and it appears to have been carried out by a price comparison website called Kelkoo (who have a vested interest in getting people online to shop around), but it's interesting nonetheless, as it illustrates, yet again, that competition drives prices down. Very crudely speaking, the bigger and less isolated the town, the cheaper things are in the shops.

But remember: this generalisation only applies to physical goods which are both produced and consumed a long distance from the actual point of sale, and which are traded all across the globe. Services, and goods consumed at point of use - i.e. a cup of coffee, a beer, a tank of petrol - are very much more expensive in London because you are paying a lot of embedded rent.

"Glasgow against local tax plan"

Here's an interesting article about the Labour-controlled Glasgow Council rejecting the SNP's plans to replace Council Tax with a Local Income Tax.

The SNP are supposed to be the economically clued up party! We can ignore the maths of this - the fact that HM Treasury is happy to pay Council Tax Benefit but would not pay 'Local Income Tax Benefit' - there is a more fundamental point:

Imagine a landlord who lets out properties in Glasgow. Tenants' total housing budget (rent plus Council Tax) is set by the market, so the actual rents that a landlord collects is the tenants' total housing budget less Council Tax. In economic terms, the Council Tax is borne by the landlord. There's a good Wiki article about the economic incidence of taxes here; the relevant chart is the one headed 'Inelastic supply, elastic demand'.

Further, in practice, housing is a 'normal' good, in other words, it is a fairly fixed proportion of people's disposable incomes.

Let us assume for sake of argument that tenant households have an average gross income of £40,000 and a net income of £30,000; average Council Tax is £1,000; and tenants allocate one-third of their net incomes to their housing budget. In this case, the average housing budget would be £10,000; £1,000 is paid in Council Tax and the rent paid to the landlord is £9,000.

If Council Tax were replaced by a Local Income Tax of 2.5%, the tenant household's average net income would fall to £29,000 so this depresses their total housing budget slightly to £9,667. But without Council Tax, the landlord can now increase the rent to £9,667.

So who would benefit most from a 'Local Income Tax'?