"That has ignored the evidence..."

Howard Flight, at Conservative Home:

Finally, under George Osborne’s period as Chancellor, the Treasury persuaded him that increasing the tax burden on smaller buy-to-let operators would reduce buy-to-let activity and so make available more properties for owner occupiers to buy.

This has ignored the evidence that there is very little competition for the same properties between buy-to-let and owner-occupier purchasers.

I'm not sure what evidence he has that everybody else is ignoring. But he's clearly ignoring things like this:

From Finder.com - number of FTBs going up year by year:



From the Financial Times number of BTLs going down year by year:



I am perfectly aware that it is a bit sloppy to compare absolute numbers of FTBs with relative numbers of buy-to-let landlords, but the total number of homes bought and sold has been fairly constant, and that's the best I can track down.

The smoking gun is 2015 - shortly before the new higher rates on BTL purchases came in, there was a spike in BTL purchases with a corresponding dip in FTB purchases.

Don't just book it...

From The Torygraph:

As many as 150,000 Thomas Cook passengers have been left stranded abroad awaiting repatriation after the travel giant ceased trading.

The company was unable to secure the extra £200 million needed to keep the business afloat following a full day of crucial talks with the major shareholder and creditors on Sunday, leaving thousands of travel plans in chaos.

This morning, the last Thomas Cook flights landed in the UK, with staff in tears and passengers coordinating a 'whip round' of donations. Transport Secretary Grant Shapps said dozens of charter planes, from as far afield as Malaysia, had been hired to fly customers home free of charge and hundreds of people were working in call centres and at airports.

I really don't get it.

Thomas Cook (not sure which bits, the corporate structure is unclear to me) went bankrupt and the administrators pulled down the shutters. Sacked their staff, cancelled future flights etc.

This leaves lots of people who have to get home somehow. A lot of them ended up paying extortionate ticket prices to get home. This illustrates my point that a large part of airline ticket prices is pure rent. They could get away with it because of temporary scarcity. Thomas Cook's jets were parked somewhere, their slots left unused with all their pilots and crew out of work - while planes and crews "from as far afield as Malaysia" were being hired at huge cost. Why not use what's nearest to hand?

'Somebody' has to pay for the stranded passengers to get home. For the purposes of this discussion, it does not matter whether that is the passengers themselves, their holiday insurance companies, ATOL, the UK government. And that cost should be kept as low as possible.

My question is, why didn't the UK CAA or ATOL simply chip in for one or two week's operating costs, long enough to get everybody home? That would be a lot less hassle than sorting out a hundred thousand individual insurance/compensation claims (and "hundreds of [extra] people... working in call centres and at airports"). It would work out far cheaper for the 'somebody' who ends up footing the bill, that saving being equal and opposite to the super-profits/rents which surviving airlines have just collected, plus the reduction in admin and hassle for all concerned.

We are considerably greener than you!

From the BBC:

The Scottish government's targets for cutting greenhouse gas emissions have been strengthened, as MSPs voted to put down a "net-zero" target in law.

The Climate Change Bill - which aims to have all emissions offset by 2045 - was passed by 113 votes to 0 at Holyrood. Ministers agreed to a Labour amendment to up the interim target, with members agreeing to target a 75% reduction by 2030, compared with 1990 levels. However, a Green bid to increase this goal to 80% was heavily defeated.

Environment Secretary Roseanna Cunningham said the government was "putting in place the most stringent framework of statutory targets of any country in the world". The Greens abstained in the final vote, and said members should "not pretend this bill is anywhere near meaningful action to address the climate emergency".

If they really meant it, they could make a start by shutting down the oil wells and leave the fossil fuels in the ground.

Killer Arguments Against Citizen's Income, Not (23)

Summary of thread started by James Medlock on Twitter.

JM: One of the most underrated parts of a universal welfare state is the income-smoothing effect. Even if you pay in just as much as you take out, there’s an efficiency gain in redistributing from yourself at peak earning years to yourself when you’re sick, old, young, or unemployed.

Steven Hart (first half of KCN): Only if you suppose the utility of income is relatively flat across an individual's lifetime, which is a massive assumption.

Me (with my Citizen's Basic Income Trust hat on): Is marginal utility the same across a lifetime? For most yes, for some they'd prefer it earlier, others later, it all averages out. It's safe to assume that the marginal value of income is highest when your fixed costs take up most of our income. So smoothing income, assuming fixed costs are fixed, must increase overall utility.

SH: In theory perhaps, but in practice absolutely not. For example, the marginal value of income increases significantly when you have a family. This is not merely an issue of discounting.

JM: The whole point of a comprehensive welfare state is to redistribute to you during periods where marginal value of income increases. So you have a Child Allowance to increase your income at that point, paid during your childless years.

SH: But there is no way of determining the marginal value of income. In such a system, a bureaucrat decides for you*. Such a system *may* benefit citizens, but it is by no means a guarantee, even under a great number of simplifying assumptions.

JM: It's a safe bet that marginal value increases when you're a parent. You just said so yourself. And peak earning years don't match up with peak child rearing years. A child allowance is clearly beneficial here.

* I didn't respond to this, which is clearly nonsense. Marginal value of income just is whatever it is. No bureaucrat decides it. Any income smoothing must, by definition, increase overall marginal utility of spending.
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SH (second half of KCN): The less taxation, the more an individual has the ability to distribute income according to his or her own preferences.

Me: Citizens income is a tax rebate. It's negative taxation, not taxation. Total income the same, as the original tweet said.

SH: That's irrelevant to the critique. If it helps you, replace "taxation" with "incoming smoothing" in my Tweet. I'm saying that the same income redistributed equally throughout a lifetime is not necessarily superior to non-redistributed, even absent any consideration of incentives.

That's not a practical example. There is no thought experiment you can run to prove or disprove this. It's a simple fact that people can cope very well with sudden large increases in income (or falls in fixed costs) but can't cope so well with sudden falls in income (or increases in fixed costs).

A welfare state shouldn't flatten income too much because that would be a disincentive to working (and that would be bad for society/the economy), but just leaving people to their fates and allowing massive and increasing inequality is bad for society/the economy as well. Pitch it somewhere in the middle and you won't be far wrong.
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Anyway, it's a good argument FOR a Citizen's Income, I'll expand on this in future posts.

"Trump plans ban on sale of flavoured handguns"

From the BBC:

US President Donald Trump has announced that his administration will ban flavoured handguns, after a spate of shooting-related deaths.

Mr Trump told reporters shooting at people was a "new problem", especially for children.

US Health Secretary Alex Azar said the Firearm and Drug Administration (FDA) would finalise a plan to take all non-lead flavours off the market.

There have been six deaths and 450 reported cases of chest injuries tied to shootings involving flavoured handguns across 33 states. Many of the 450 reported cases are young people, with an average age of 19.

Lead-related deaths are holding steady at around 40,000 per annum.

And Thomas Cook's main asset is...

From City AM:

Meanwhile, assets like its combined 560 take-off and landing slots at Gatwick and Manchester are likely to be snapped up by other airlines over the coming months.

In late 2017, British Airways bought 20 prime take-off and landing slots from collapsed airline Monarch at Gatwick and Luton. That deal was worth an estimated £60m.

I don't think that the Alarmists believe the horror scenarios

Most people who have jumped on the Alarmist band-wagon are arguing for things that they would have argued for anyway, which have little to do with reducing CO2 emissions, for example Ed Miliband calls for 'wartime' mobilisation to tackle climate crisis. The militant vegans say we should stop eating meat. The NIMBYs say we should stop fracking. The 'climate scientists' are holding out for more government grants. Authors can get on the best-seller lists with titles like Life After Warming. You're not going to sell many books saying that everything will sort itself out just fine. The solar panel people want subsidies for solar panels. Large landowners want subsidies for windmills. Etcetera.

They also jumble in a lot of common sense stuff that has little to do with CO2 levels in the narrow sense, like reducing air pollution in town centres; plastic waste in the oceans; deforestation etc.

Then there are the Useful Idiots who probably do believe it and really enjoy the attention, but that's a group think thing, to paraphrase Harry Enfield, "I am considerably more Alarmist than you." I'm sure it's the same in any sub-culture, be that followers of a particular football club; fans of a particular pop group; racists, vegans, even Georgists. You want to attend every away game and own every replica kit; own every CD and attend every concert; be more racist than the others; wear plastic shoes; decry corporation tax or higher rate income tax (which are largely taxes on 'rents', so fit in with general Georgist principles IMHO).

If any of these Alarmists seriously believed a fraction of their own propaganda, you'd expect them to buy a log cabin in the wilds of Canada or Scandinavia, become self-sufficient and arm themselves with a shotgun. You wouldn't expect them to be buying beach front villas or cheerfully flying from one international climate change conference to another.

And if they don't really believe it, I don't see why I should.

"Berserk herd of cattle trampled a woman, 87, to death while she was ..."

You guessed it, from The Daily Mail, "... walking her dog".

I'd also assume that from an evolutionary point of view, the cows' behaviour was entirely rational, shaped as it is by millions of years of wolves snatching their calves.

"Downton"

Her Indoors and I went to see this yesterday.

As I expected, there is no real plot, just a few sketchy sub-plots with tenuous links to each other; the characters are one-dimensional to the point of being caricatures (yet still inconsistent); the film barely questions the underlying social injustices - a couple of the characters claim to be 'republicans' i.e. anti-monarchy without realising that their employer, a large landowner, is a beneficiary of the exploitative monarchical system.

The filming is 'sumptuous', nice camera angles and lighting, beautiful interiors and costumes etc. There was only one crass anachronism, when a self-employed plumber who worked late said "I want to make a success of my business, so I don't just do nine-to-five", and apart from that it all looked historically accurate to me.

It's basically three episodes of the TV series shown back-to-back without advertising breaks.

Yet somehow it grinds you down and I left the cinema in a good mood with a big dumb grin on my face. Strange.

Fun With Numbers

The Lass and I were brainstorming yesterday, and between us, came up with this sequence/pattern, where x,y are positive integers.

I am using the European convention of using a full stop to denote 'multiply', so "x^3.y" means "x-cubed times y" (to avoid confusion with "x^3y" which could mean "x to the power of three y").

x^1 - y^1 = (x - y)
x^2 - y^2 = (x - y)(x + y)
x^3 - y^3 = (x - y)(x^2 + x.y + y^2)
x^4 - y^4 = (x - y)(x^3 + x^2.y + x.y^2 + y^3)

We didn't work out x^5 - y^5 the long way, but my initial assumption is...
x^5 - y^5 =(x - y)(x^4 + x^3.y + x^2.y^2 + x.y^3 + y^4).

Update 1, PJH in the comments confirms this with link.
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Update 2, Bayard and Derek discuss negative powers in the comments. The pattern is fairly straightforward.

For example, assuming x > y, and we want to break down (y^-2) - (x^-2), which can also be expressed as (1/y^2) - (1/x^2).

The answer is a fraction.

The bottom bit is to the power 2, so the top part of the fraction (numerator) is the same as for "x^2 - y^2" in the above list, i.e. "(x - y)(x + y)".

The bottom bit of the fraction (denominator) is just x^2.y^2