Sunday 30 April 2017

UK car manufacturing, imports and exports puzzle - a possible explanation.

From the European Automobile Manufacturers Association, shortly before GBP fell with a corresponding boost to exports/fall in imports:

80% of the UK’s automobile production is exported, of which 52.8% (worth €14.6 billion) goes to EU member states. The other way round, the EU represents 81% of the UK’s motor vehicle import volume, worth €44.7 billion.

In very round numbers and to exaggerate a bit, all cars manufactured in the UK are exported and all the cars we drive are imported. There is a huge amount of churn involved. This has been bugging me since Mrs W bought a new Ford Kuga last year which was shipped in from Spain, not made in Dagenham (any more).

A possible explanation occurred to me recently.

1. Different people want different kinds of car.

2. In olden times, there were lots of smaller manufacturers in each country, making lots of different models, so the chances were you could find something you liked made in your home country.*

3. There has been a lot of consolidation in the car industry, there are just a few very big manufacturers left.

4. Big manufacturers like big factories. Instead of having small factories dotted around Europe, they prefer making all their cars in the same place. So each country ends up with a handful of huge factories, each making a narrow range of cars. (We all know that Germany punches above its weight here, but even their manufacturers have shifted a lot of production to Spain or their eastern neighbours to keep costs down.)

5. So nowadays, wherever you are in Europe, if you want a Fiat, it will be made in Italy; if you want a Nissan or a Honda, it will be made in the UK; if you want a Ford, it will be made in Spain; if you need a car to bully people on the motorway, it will be made in Germany, and so on.

In other words, more specialisation leads to more trade (obviously) and vice versa.

This is thus also a distant cousin of comparative advantage, I suppose. The effect works on a national, continental and global level. The UK (like most EU Member States) exports far more cars to places outside the EU than it imports from outside the EU.

Or to put it another way, European countries are the best at car manufacturing, that's the Premier League, but within that Premier League, the UK is in mid-table and all the teams above it are German.

* The old rules still seem to apply to really low volume niche cars, like Noble, McLaren, Spyker, Pagani, Koenigsegg etc. Those are still dotted around across the continent, and if you have more money than sense, you'd probably go patriotic and buy one made in your own country, I know I would.

"We choose to… do the other things, not because they are easy but because they are hard." (2)

Before. Well, just after I started and then remembered I hadn't done the before photo:

After. I made it from decking material, so hopefully reasonably water resistant. There is a diagonal plank on the back (from bottom hinge to opposite corner) to keep it square. Mrs W insisted on fitting the grille herself, which is why it was inside out and upside down:

Saturday 29 April 2017


This is simply a naked attempt at extraterritoriality.

Rather like this.

Best just to walk away...

Friday 28 April 2017

Daily Mail on top form

Hedge fund boss accused of keeping his ex-Merrill Lynch Trader wife 'virtual prisoner' in their £3.4million Knightsbridge home 'demanded that she arranged his green beans neatly on his dinner plate'

What on earth difference does it make how much the house is worth to the severity of the crime (to the extent that a crime was committed)?

Mitchenson allegedly beat her over head with glass...

That sounds like a crime.

... and attacked her with pillow

That doesn't.

Thursday 27 April 2017

Strewth Sheila, 'Straya has fake charities too!

From the BBC:

The vast majority of Australians worry that national drinking habits are excessive, according to new research.

An online poll commissioned by the Foundation for Alcohol Research and Education (Fare) also found 92% of Australians believe alcohol is linked to domestic violence.

Fare surveyed 1,820 people across Australia...

Ho hum.

From FARE's our history page:

The Foundation for Alcohol Research and Education (FARE), formerly the Alcohol Education & Rehabilitation Foundation (AERF), is an independent, not-for-profit, national health organisation based in Canberra, Australia.

Established in 2001 by the Australian Parliament with a $115 million grant, the Foundation was set up to distribute funding for programs and research that aimed to prevent the harms caused by alcohol and licit substance misuse...

The balance sheet on page 11 of their 2015 accounts shows they've burned through two-thirds of the original $115 million.

Note 2 on page 20 shows all their investment income, the next largest source is government funding of $164,217, previous year $226,377.

Wednesday 26 April 2017

Home-Owner-Ists 1: Economic reality 4.

From City AM:

New stamp duty rules are causing landlords to sell up in droves

An unforced own-goal right from the kick-off there. The extra 3% SDLT for non-owner occupiers might deter new landlords, but existing landlords are more likely to hang on to what they already own.

Last year the government introduced new rules meaning landlords could no longer claim relief on interest payments on their mortgages...

Another own goal in the third minute. They *can* claim relief, it will just be restricted to 20% (to be phased in over the next few years).

... at the time landlords warned it would put people off putting their homes up for rent, pushing up rental prices.

One apiece on the main point, everybody agreed it would force a few highly leveraged landlords to sell up; followed by a foul in the Homey's box and a penalty opportunity for Economic Reality.

Economic Reality's best striker is trotting up to the ball... the decider is, will more or fewer homes be up for rent and will rents go up or down?

Economic Reality says - when landlords sell up, it will be higher earning tenants who buy them, thus leaving a smaller pool of lower earning tenants, putting downward pressure on rents. This is quite the opposite of the Disappearing Homes Conundrum.

However, the figures also showed the supply of rental stock increased eight per cent in the year to March, from 169 properties per branch to 183. The figure was flat on February.

Back of the net! From the point of view of a BTL landlord, the interest acts like (privately collected) LVT so encourages them to make best use of what they own - get a tenant in or sell it; tax relief for interest ameliorates that, so reducing the value of the tax relief makes it a bit more like LVT again. An unexpected but welcome impact.

The number of tenants negotiating rent reductions also rose, with 3.6 per cent of agents saying they had witnessed tenants knocking down prices in March, compared with 2.2 per cent in February.

Some people are on the pitch. They think it's all over...

A quarter of agents said landlords had raised rents in March, down seven percentage points from March 2016.

It is now!

Tuesday 25 April 2017

There's a right way and a wrong way to do everything.

The right way

From a London Assembly press release:

Recommendations include:

• The Mayor must take a visible lead in tackling FGM. The delivery of the Police and Crime Plan must demonstrate this commitment and drive a multi-agency response to FGM.

• A pan-London campaign to raise awareness of the real dangers of FGM, signposting women and girls to the support they require.

• Communities affected by FGM should be engaged to raise awareness, strengthen community-based prevention work and provide training for professionals.

• The Mayor must support the provision of bespoke training for London’s frontline practitioners.

• Support should be given to the police, health, social care and education services, voluntary organisations and communities.

The wrong way

From Sky News:

Mandatory checks are already law in France, which has had far greater success prosecuting FGM cases. Although it has been illegal in the UK since 1987, there have been no successful prosecutions.

Ms Parker said: "All these measures to combat this despicable crime are already law in France, a country that has a far, far better record than us on FGM. Not only have they proven effective both in protecting girls in France from FGM, they also help provide essential evidence to mount prosecutions where FGM has taken place. It is time the United Kingdom caught up."

Monday 24 April 2017

Fun Online Polls: North Korea; The French presidential election

The results to last week's Fun Online Poll were as follows:

How would you prefer Donald Trump to deal with North Korea?

Stop ramping up the rhetoric and just ignore them - 28%
Try and persuade PR China to withdraw support - 44%
Continue with gunboat diplomacy - 6%
Drop a nuke on Pyongyang - 13%
Launch a full-on invasion - 2%
Other, please specify - 7%

Good, I voted for one of the first two (I think the second one), having read around, that does seem like the most sensible option.
This week's Fun Online Poll, before it's superseded by events:

If you were voting in the French presidential election:

Macron - the Europhile former Rothschilds banker and Socialist minister, whose campaign was apparently funded by Goldman Sachs.

LePen - the other one..

Vote here or use the widget in the sidebar.

"Central London housebuilding collapses 75% as prices continue to fall"

From Property Investor Today:

The number of new homes breaking ground in central London has plunged by 75% year-on-year as house builders put planned projects on hold, and in some cases, scrap them altogether, in light of falling prices in the capital.

According to fresh data from JLL, just 1,270 residential properties were started in zones one and two in the final quarter of 2016, the lowest total for five years, as the “particularly low” figures seen in central London during the first three quarters of the year continued.

Stamp duty, in particular, continues to have a detrimental effect on the housing market in central London where properties command a price premium, resulting in a 10% levy up to £1.5m and 12% above that figure, which largely explains why fewer property transactions and lower prices are being achieved.

The number of homes changing hands in central London has been plummeting, illustrated by the 24% drop recorded in Q4 to just 1,880 transactions, while prices for newly built homes have fallen by 5.7% year-on-year, JLL found.

As Dinero commented to my post of Saturday: You don't need collusion and meetings for effects that are similar to that from a cartel. Just a restricted number of similar minded people with the same goal and information.

The end effect is indeed the same. When new homes are built and sold, it depresses prices in the very short term. Developers have found out by trial and error that this effect can be minimised if only one new home is sold for every nine existing homes bought and sold 'second hand', which is why they cap their output at this level. So if buyer interest falls, prices and volumes fall, and developers put projects on hold, maintaining the one-to-one ratio.

A explicit cartel is required to restrict supply and maintain prices if supply restrictions mean current revenue is lost which cannot be clawed back in future years. If hairdressers collude to restrict supply and push up prices, then people will let their hair grow longer between visits or learn to cut it themselves. Overall, hairdressers will lose revenue. Whether their profits are increased by this tactic depends on whether the reduction in marginal costs is more or less than the fall in revenue.

But the large developers are just land bankers, so they don't need to worry about whether they realise the profit from a site this year, next year or some years into the future. They can only sell each site once, there is no loss of revenue and as the land element is pure profit, there is no loss of profit. This also explains why the cartels for oil and diamonds have been relatively effective - you can only extract and sell oil or diamonds once.

Saturday 22 April 2017

Reader's Letter Of The Day

From yesterday's Evening Standard:

Developers on rely [sic] high house prices

Regardless of how liberal planning laws are, developers will cap their output at a level which does not lead to any significant falls in prices [Letters, April 18]. If they can sell new homes to wealthy overseas investors, then so much the better.*

This is not a housing crisis — it has been deliberately engineered. After 1945 UK housing policy was to limit rents, protect tenants, cap house prices indirectly by capping mortgages at two-and-a-half times earnings and ensure a ready supply of social housing. This led to a rapid increase in owner-occupation, the nigh-extinction of the landlord class and a small and stable banking sector. This was eventually reversed.

London First may call for more houses to be built but the backers on its website — banks, large landowners and property developers — are the very people who will do anything to ensure that rents and prices in London stay sky-high.

These people know full well that simply building more homes in itself solves nothing.

Mark Wadsworth​, Young People’s Party.

* They edited down my original opening paragraphs which explained the more subtle point:

Real-world evidence shows us that rents and prices in every country in the world are the highest in the largest cities. When more people will move into the new homes, this means a larger pool of potential employees and customers for businesses, which in turn means more job, leisure and social opportunities, all of which lead to yet a self-reinforcing cycle of even higher rents and even higher prices.

Real-world evidence also shows us that - regardless of how liberal planning laws are - developers will cap their output at a level which does not lead to any significant falls in prices. If they can sell the new homes to wealthy overseas investors who will leave them empty or merely collect the rent from younger workers, then so much the better. If prices show any sign of dipping, then projects are simply mothballed.

Friday 21 April 2017

Nobody move or the mozzarrella gets it!

City AM passes on some fear-mongering:

Food prices will soar on key supermarket items such as mozzarella, tomatoes and apples if the UK does not secure a transitional trade agreement, retail's industry body has warned.

If the EU and the UK fail to agree to maintain current tariff rates, trading of goods will come under the rules governed by the World Trade Organisation (WTO). This means tariffs on Italian mozzarella and Irish cheddar will jump to 45.5 per cent and 44.1 per cent respectively on the day the UK officially exits the EU.

Ray Symons, head of European and International Affairs at the British Retail Consortium (BRC) said: "If the UK and EU fail to reach an is difficult to see how this couldn’t affect shop prices."


The WTO does not set minimum or standard tariffs at all, the UK is free to impose lower rates or abolish tariffs unilaterally. The WTO is all about encouraging countries to reduce their import tariffs, abolish import quotas etc.

The key to longevity appears to be sticking to a daily routine.

From The Guardian:

Morano’s extraordinarily long life began on 29 November 1899...

She attributed her longevity to leaving her husband in 1938 shortly after the death of her only child at the age of seven months, and to the inclusion in her daily diet of two raw eggs and a little raw minced meat. When she was 20, her doctor had told her she was anaemic and that such a diet would improve her health.

Bava, her doctor for 27 years, said Morano rarely ate vegetables or fruit. “When I first met her she ate three eggs a day, two raw in the morning and then an omelette at noon, and chicken at dinner.”

Also from The Guardian:

A Spanish woman, Ana Vela, 115, who was born on 29 October 1901, is the oldest European and the fourth oldest person in the world, according to the GRG...

Speaking to El País last summer, Vela’s daughter said there was no secret to her mother’s extraordinarily long life. “She liked a glass of semi-sweet wine with her meals, but she was never one to drink a lot. She ate everything: meat, fish, vegetables. Her diet was very normal – just home-cooked stuff.”

Thursday 20 April 2017

YPP (London) meet-up, tomorrow Friday 21 April

We'll be at The Brewmaster from 5.20 onwards or so - if you think you'll turn up later than 6.30, please get in touch or 07954 59 07 44.

Leicester Square Tube Exit 1, turn left and left again into the alleyway (St Martin's Court). We put a yellow YPP leaflet on the table so that you can find us.

Topics: Two people have put themselves forward to stand at the snap General Election - any more takers?

"Is your child's school about to start charging you as government funding dries up?"

From The Manchester Evening News (the first article that came up on Google):

The government is proposing to change its funding formula to individual schools.

It means schools in Manchester will stand to lose £10m a year under the move, more than anywhere else outside London, with funding for schools cut by 2.7 per cent overall...

One of the schools facing ‘financial crisis’ in Greater Manchester is King David High School - one of the region’s’s most successful state schools. Joshua Rowe, chair of governors at King David, says his school is going to be one of the worst hit by the government’s ‘savage’ budget cuts.

Mr Rowe claims his school’s annual income has dropped by approximately £1m in the last four years - posing an ‘existential threat’ to the Jewish high school. He says they have lost £700,000 in government cuts, £250,000 through inflation and are now having to pick up the £120,000 SEN budget, which was previously covered by the council.

Now the state-funded Jewish faith school in Crumpsall has been told it can expect further funding cuts in the next two years and has now launched a huge fundraising campaign, although has stopped short of asking families for payments.

To be honest, why shouldn't councils charge extra fees for places at the best schools? They can transfer that money to the other schools in the area (underperforming or in poorer areas) to try and level things up a bit.

As we know, if you don't make parents pay directly for a place at a good state school, they will pay indirectly via higher house prices in the catchment area.

This also ties in nicely with the idea of education vouchers, where the taxpayer pays a basic minimum figure (maybe £5,000 for a primary place and £8,000 for a secondary place?) and parents pay the difference. Local education authorities just then have to redistribute the extra money somehow, for example by reducing the value of the vouchers for schools with very high extra fees or something.

Land Value Tax is usually the best way of collecting community generated land value, but if the value relates to a specific service that is only used by a small part of the population at any time, then why not do it directly with user charges? They can bump up the user charge until there simply is no measurable difference in house prices between homes just inside and just outside the catchment area.

For sure, this prices lower income families out of good schools, but the land market does that anyway. A canny good school will always have some free places for poor-but-clever children to bump up their grade averages (which is how I got a free place at a private grammar school, seemed to me like a good deal for both parties). There's not even such a thing as a Poor Widow In A Mansion With School Age Children :-)

General Election 2017 - call for candidates

If anybody is willing to stand as a YPP candidate in their constituency and has a few hours to spare to get all the signatures and form filling done, please get in touch.

YPP has £1,000 in the kitty which we will divide up between people willing to stand and use to pay towards their £500 deposits (which has to be paid in cash in advance).

We have previously gone to the bother and expense of getting leaflets approved, printed and taken to the Post Office. This costs another £1,500 - £2,000 per constituency and doesn't seem to make any difference.

Wednesday 19 April 2017

"People earning more than I do are rich"

From The Daily Mail:

People earning £70,000 a year (1) are 'rich' and should pay more tax, shadow chancellor John McDonnell said today.

On what is effectively the first day of the election campaign, Mr McDonnell said Labour would create a 'fairer' system - hinting that could include a new tax band.

The intervention will cause dismay among party moderates who have been warning that the hard-left leadership is driving away middle class voters (2).

Mr McDonnell added: 'The rich will be above £70,000 to £80,000 a year and that's roughly defined as what people feel is an earning whereby people feel they can pay more.'(3)

1) An MP's basic salary is £74,000. Coincidence? Admittedly John McDonnell is currently being paid more than that for acting as Shadow Chancellor, but he knows it won't last.

2) Only a few per cent of people are paid more than £70,000 a year.

3) Nope. The real difference is whether people have to pay rent or not, that is the largest single cause of inequality in this country. A home-owner with no mortgage on £45,000 has the same disposable income (after PAYE and privately collected tax i.e. rent) as a tenant on £70,000. Hence and why it would advance the cause of equality much more if taxes on residential land were increased and taxes on wages and output reduced.

Peter Lilley, still on top form

Emailed in by MBK, from ConHome:

£350 million per week is the gross contribution that Britain pays the EU before netting off the Thatcher rebate and the money that the EU pays back to British farmers, regions, and so on. The Office of Budget Responsibility puts the net figure at £200 million per week, which it assumes will be used to fund increased public spending.

Apparently, Vote Leave organisers deliberately quoted the gross figure to provoke controversy, and in the hope that the Remainers would respond by saying: “the true net figure is only £200 million per week”. They calculated that the public would be incensed that anyone can be indifferent to paying over such large amounts – whether the true figure is £350 or £200 million.

Unfortunately for the Leave campaign, most Remainers did not fall for that. They denounced ad nauseam the £350 million as a “lie”, but wisely did not cite the true net figure at all, instead implying or asserting that it was negligible, if not zero...

Belief that the referendum was won by a single big lie clearly provides solace to the losers. It excuses their defeat, while enabling them to feel morally and intellectually superior to the gullible and ignorant majority.

If the issue were just about scrupulous use of figures I would have sympathy for the Remainers. The Leave campaigners’ justification for using the gross figure – that when asked how much they earn people usually give the gross amount, not the net figure after tax – is valid but unconvincing.

For my part, I invariably used the net figure of £200 million per week in debates, articles and leaflets throughout the campaign. I did not meet anyone who, on learning that the net figure was “only” £200 million not £350 million per week, decided not to vote Leave!

But, in virtually every referendum debate, my Remain opponents asserted, in all sincerity – because that was what they had been lead to believe - that the “true” net figure was negligible or zero.

He only pops up once every few years, but it's usually good stuff.

Tuesday 18 April 2017

"Luckily his fall was partially intervened by a utility pole..."

From The Daily Mail:

A seven-year-old boy from China has survived after intimating [sic] a cartoon character and leaping out from a 10th-storey window with an umbrella...

Luckily his fall was partially intervened [sic] by an [sic] utility pole which the boy hit before landing on the cement ground next to a hair salon. This has apparently saved his life.

Bloody hell...

A similar incident happened last month in China's Urumqi city in Xinjiang Uyghur Autonomous Region.

A five-year-old girl reportedly jumped out of a window on the 11th floor after watching a popular Chinese cartoon named 'Boonie Bears'.

She jumped from the window wearing a backpack and carrying an umbrella. The little girl suffered severe injuries after landing on a cement platform on the fourth floor.

Are Chinese children made of rubber?

Monday 17 April 2017

Fun Online Polls: Russia/Syria & North Korea

The results to last week's Fun Online Poll were as follows:

Should the G7 impose further sanctions on Russia because of Assad's nerve gas attack in Syria?

Yes - 7%
No - 93%

Good, I was with the majority on that.

There was some scepticism in the comments as to whether Assad's regime was behind the attack and whether there was actually a nerve gas attack. I would add, even if there was and Assad's forces were behind it, how are the Russians to blame (the people as opposed to Putin) and even if Putin were somehow to blame, what difference would it make, apart from pushing up our domestic gas prices and making Putin even more delusional?

Thanks to all 81 who took part.
This week, let's stick with the big issues.

"How would you prefer Donald Trump to deal with North Korea?"

Vote here or use the widget in the sidebar.

Sunday 16 April 2017

"How Dave's chums are lining their porky pockets"

The Daily Mail does what appears to be a bit of original research for once:

Set in 20 acres of Florida’s ocean-front splendour and with the best suites costing from £6,000-a-night, the Fontainebleau Hotel is in area of Miami Beach known vulgarly as Millionaires’ Row.

This week, one of its guests has been David Cameron, on the latest stop of his post-Downing Street money-making career. He was a star turn at the annual Credit Suisse Global Trading Forum where business leaders discussed ways to enrich themselves and others in the world of finance. His fee was around £100,000.

Next month, the former PM (who quit as an MP very soon after his humiliating EU referendum defeat and thus is no longer obliged by parliamentary rules to declare his earnings) will speak at a hedge fund conference in Las Vegas.

Cameron isn’t the only one cashing in on his six years in Downing Street. His closest former advisers and friends — most of whom he rewarded with gongs and titles — are also lining their pockets in a way that tarnishes public trust in the political system...

The article then runs through a list of all the lucrative stuff which some of his other ex-Number 10 people are now doing, well worth a read just to get your blood boiling.

Maybe I spend too much time railing against certain specific categories of rent seeking, i.e. tax avoidance by landowners and homeowners (in their capacity as landowners; most of them are also workers and thus paying too much tax on their earnings and spending) and the obscene salaries of senior banking employees who piggy-back the landownership system (and enjoy other state-backed privileges and subsidies).

The type of genteel corruption outlined into the article is another symptom of the same thing. Underlying both is the fact that a stable society/nation state with peace and order within its own borders (the more so if it is at peace with its neighbours) enables people to generates far more wealth that they could in some sort of "anarcho-capitalist" system (whatever that is).

Few people are actually worse off for the existence of nation-state, but the extra wealth i.e. rent belongs to everybody and nobody, no identifiable individual created it, so that is what is up for grabs and should be the primary source of government funding, not the primary source of ex-government employees lining their own pockets.

For a nation-state you need overarching common rules and public bodies to enforce them, they usually accrue far too much influence and their budgets swell accordingly. Even the smallest, most streamlined government will need to buy stuff from the private sector, and given the billions at their disposal, it's hardly any wonder that the providers like to bribe those responsible for dishing out the subsidies and enforcing 'standards' which operate as barriers to entry.

So you can never eliminate it, all you can do is keep it to a minimum (taxing land values is administratively easy, keeping the government streamlined is a constant battle and how you police millions of public sector workers even in a streamlined government, I do not know).

The examples in the article show quite clearly that the UK is doing no such thing.

That seems to be the whole point of getting elected or being promoted to a senior public sector job nowadays, for the goodies you can collect afterwards from the people you did favours for while in office (or even while you are in office, see also from the Daily Mail: The 539 town hall fat cats who rake in MORE than the Prime Minister).

Saturday 15 April 2017

Another Monumentally Stupid Idea

Here we go again.

Why will these people never learn that in every case all these scrappage subsidy schemes simply pass straight through the hands of the 'consumer' into the hands of whatever producer is at the end of the chain.

In this case a secondary effect is to reduce the supply of used cars hence forcing up prices.  Which would also deal with the possible low resale values of all those cars on PCP schemes landing on the balance sheets of the car companies.

Oh, hang on a minute.  Yes.  Silly me.

(There was another article on the DT website about this today, but I can't find it now).

"The cows are channelling their Trump tendencies"

... says Graeme* in the comments, with a link to The Telegraph:

Travelers on the London-to-Uckfield train line were probably not that surprised to hear their service faced delays on Saturday afternoon.

However, while delays on Southern rail are far from unusual, the reason this time was at least a novel one – a herd of cows had invaded the platform at Hever station. Student Francesca Ryan took a picture of the animals – one of which had fallen off the platform onto the track 
[see article for glorious photo]

Southern issued a statement saying:

“A herd of cows (up to 60) are [sic] on the line between Hever and Ashurst. Network Rail response staff are on site trying to herd the cows back onto the land they escaped from. There is currently no service between Oxted and Uckfield.”

* It only seems fair to link back to his blog in return. Via his Blogger profile and a few clicks later I ended up at Not sure if I took a wrong turn on the internet or something.

Friday 14 April 2017

"Tens of thousands of public sector contractors to see net pay slashed by a fifth"

From a press release from Randstad (employment/recruitment agency) which landed in my inbox two weeks ago:

* Final legislation on off-payroll working or “disguised employment” comes into force on 6 April and could see contractors’ net take-home pay drop by 20% (1)
* Public sector organisations, having had little time to prepare for the change, are overwhelmingly following the line that all roles will fall within IR35
* Randstad warns of a mass exodus of public sector contractors to the private sector, leading to skills shortages in vital public services (2)

About time too.

It's fair enough if people/businesses in the private sector try and reduce their National Insurance liabilities by dressing up employment as self-employment. National Insurance is a nasty tax, so I have no moral qualms about that, even though in practice I don't recommend it as HMRC usually catches up with you and then it gets really nasty.

But it always horrified me that public sector employers go along with this charade. The tax withheld from wages by the public sector is not really tax, it is a pay cut, that's great news for taxpayers.

1) How on earth they work out that net take-home pay will fall by 20% is a mystery to me. Income tax rates are the same for employees and the self-employed, and Employees' and Class 4 National Insurance on earnings over the upper earnings limit is the same (2%).

The only difference is between Employees' NIC (12.8%) and Class 4 NIC (9%) on earnings up to that limit (so maximum cost/pay cut approx. £1,000 a year). The rules on allowable expenses are a bit more generous for the self-employed than for employees, but in practice, that doesn't make a huge difference.

2) And finally, let's see whether there is a mass exodus or not, I don't see how there can be. MBK tells me that if you have worked in the public sector for a few years, private sector employers aren't interested in you any more. Private sector employers are not going to magically create roles for all of them with their largely untransferable skills, are they?

Thursday 13 April 2017

"House prices go up... number of births goes down"

The Daily Mail publishes a summary of some research by the EBRD:

Young couples are putting off starting a family as a result of rising house prices, research shows.

They want a home of their own before they have a baby but face a longer wait before they can afford to buy. A European Bank for Reconstruction and Development study found that for every 10 per cent increase in house prices, the overall birth rate falls by 1.3 per cent.

All of which we knew anyway, it's nice to see somebody putting some numbers on it. This is exactly what the Boomers and Homeys want of course, they need today's adults to be slaving away paying off mortgages and rent, not wasting time bringing up children who will only be of benefit to society after the Boomers are all dead.

... an increase in house prices on that scale could reduce the birth rate by more than 7,000, the figures suggest.

The pattern is the opposite when looking only at those who own their home, with a 10 per cent house price rise causing a rise in the number of births among this group by 2.8 per cent.

Among renters, however, the same increase causes a birth rate decline of 4.9 per cent, bringing the overall national birth rate down.

And why does house price inflation make owner-occupiers have more kids..?

... rising house prices usually mean that those who already own a home have a larger proportion of equity in their home. This may make them feel wealthier and more inclined to have more children, he said.

Newsflash: Rising house prices do not pay off your mortgage for you. You might feel wealthier but you are not.

I accept that having children is a "choice" for the parents, but it is an absolute necessity for a healthy and cohesive society. The only other way to keep things going is to have continual mass immigration, which brings its own problems - more perceived than actual, but problems nonetheless.

Being the Daily Mail, they love the last bit:

The researchers call for the Government to scrap the maximum purchase cap of £250,000 – £450,000 in London – on its Help-to-Buy ISA as the amount may be too low to allow couples to buy a home big enough for a young family.

Aaargh! That is exactly the opposite of what they should be doing! Shifting taxes away from earnings and output to Land Value Tax will sort all this out - it will level the playing field, encourage Poor Widows to sell their Mansion to young couples, increase owner-occupation rates among people of prime child-bearing age (25 to 35), enable people to pay off their mortgages faster etc etc.

[Sadly, the report offers no conclusions as to the correlation between house prices have and the gruesomeness of domestic murders.]
UPDATE: The actual study (pdf here: does not say who funded it, maybe it was just the EBRD acting instinctively on behalf of banks generally, despite all the evidence pointing the other way.

It kicks off with:

I would like to thank Dan Anderberg, Arnaud Chevalier, Christian Hilber, Melanie Lührmann, Berkay Ozcan and seminar participants at the University of London, Royal Holloway, Royal Economic Society PhD Meetings, 29th ESPE Conference (Izmir, 2015), 30th ESPE Conference (Berlin, 2016) for their helpful comments.

I've never heard of the others, but "Professor" Hilber is the Home-Owner-Ist from Hell, so he might be the one who pushed the author towards the completely 100% wrong final recommendation.

Perhaps we ought to email the author and point out his mistake via

Wednesday 12 April 2017

Fun Online Polls: Government guidelines for physical activity & Imposing sanctions on Russia

The results to last week's Fun Online Poll were as follows:

Do you achieve the government's guidelines for physical activity every week? Multiple answers allowed.

As it happens I do, I like to keep fit - 20 votes
Yes, I take government guidelines very seriously - 0 votes
Don't know, don't care - 38 votes
No, probably not - 16 votes
No, certainly not - 8 votes
None of their business - 52 votes
Kraft durch Freude! - 4 votes
Other, please specify - 1 vote

Which is, reassuringly, pretty much what I expected. Thanks to all 102 who took part.
Daft idea of the week was floated by Boris Johnson at a G7 meeting:

Boris Johnson has failed to secure the backing of the G7 nations for swift sanctions against Russia and Syria, leaving the US-UK plan to pressurise Vladimir Putin in tatters.

Germany and Italy vetoed the idea of targeting Russian and Syrian military leaders until an investigation has been carried out into who was to blame for last week’s nerve gas attack in Idlib province.

I think the link between Russia, Assad and the actual nerve gas attack is far too tenuous to justify sanctions, even if there was any chance of them 'working' i.e. persuading Putin to change his mind (which appear to be zero).

Which reminds me, the EU imposed limited sanctions on Russia because of the Ukraine/Crimea annexation thing three years ago and what difference has that made? These were recently extended by another six months without anybody even noticing.

So that's this week's Fun Online Poll: "Should the G7 impose further sanctions on Russia because of Assad's nerve gas attack in Syria?"

Vote here or use the widget in the sidebar.

Tuesday 11 April 2017

"Social care system 'beginning to collapse' as 900 carers quit every day"

From the BBC.

I don't wish to make light of the whole topic, but I am always suspicious of "big scary numbers" in headlines, or headlines containing the words "collapse" or "black hole" for that matter. Or a government spokesman saying that they are "investing £2 billion" when they mean "spending £2 billion" and there is no mention of timeframe, whether this is the total spend, or an increase to existing spend, in which case we need the change adjusted for inflation.

The BBC reports the nub of the issue in the article:

Data gathered by the charity Skills for Care, shows that in 2015-16 there were more than 1.3 million people employed in the adult social care sector in England.

Analysing the data, BBC News has found that... An estimated 338,520 adult social care workers left their roles in 2015-16. That is equivalent to 928 people leaving their job every day.

That means annual staff turnover is one in four, or put it the other way, the average carer stays in the business for about four years.

It's very difficult work, but I bet it doesn't take too long to train up to a reasonable standard. There are a few long-termers like "Sue Gregory, who has been a nurse in a care home for over 13 years", but by and large and for most of them, it is just a short term job like working in a hotel or a supermarket or anything else. My sister did it for a few years after she finished uni, lots of nurses do it in between working in hospitals, I am sure that a large proportion are foreigners who come to the UK to earn good money (by their standards) with the intention of going home after a few years etc. You can't fault them for that.

To summarise: the 900-a-day figure is pretty meaningless on its own.
See also "445 family doctors quit the profession between September and December 2016; a rate of nearly 150 a month".

There appear to be over 200,000 GPs in the UK, so that's a turnover of less than one percent a year; assuming a typical career of thirty years, you'd expect it to be at least three per cent.

Monday 10 April 2017


Page 195 of this gives up-to-date statistics on home ownership, broken down, as they say, by age and sex, as well as many other categories. Possibly a useful resource.

No? Surely Not?


The Bank of England implicated in the 'fixing' of LIBOR. Quelle surprise.

As in my view (and the view of many others) the Bank of England's first of two main purposes is to 'fix' interest rates at a level less than the market would voluntarily lend to the government at, it is hardly surprising that they were, allegedly,  helping to 'fix' LIBOR.

(The second main purpose of the Bank of England is, having borrowed money at below market rates for the government, to work out how not to pay it back.)

Friday 7 April 2017

Smurfs: The Lost City of Z

From IMDB and IMDB:

This fully animated, all-new take on the Smurfs tells the incredible true story of British explorer Percy Fawcett.

A mysterious map sets Fawcett, his wife Smurfette, their son Brainy and best friends Clumsy and Hefty on an exciting and thrilling journey into the Amazon at the dawn of the 20th century. They discover evidence of a previously unknown Forbidden Forest filled with magical creatures and an advanced civilization that may have once inhabited the region before the evil wizard Gargamel.

Despite being ridiculed by the scientific establishment who regard indigenous populations as "savages" and dispute the existence of evil wizards, they embark on a roller-coaster journey full of action and danger.

Fawcett and The Smurfs return time and again to their beloved Forbidden Forest in an attempt to prove their case. They are on a course that would lead to the discovery of the biggest secret in Smurf history… until their mysterious disappearance in 1925.

Killer Arguments Against LVT, Not (410)

Another rebuttal of the tried and tested "But I contribute to the location value of my home, because I am a good neighbour, shop in the local shops, am a valued member of Neighbourhood Watch etc" occurred to me just now.

It is quite true, for example, that people pay extra to live in 'safe' neighbourhoods, so you are paying extra to live next to nice people, and assuming you are nice yourself, other purchasers or tenants are paying extra to live near you. Similarly, Waitrose set up where there are enough people with spare cash; in turn, being near a Waitrose bumps up local rents and prices (allegedly).

A sensible LVT is based on observed rents and selling prices. These are by definition not influenced by the ongoing efforts of the landlord/vendor because the landlord (probably) does not live in close proximity and the vendor has (probably) moved elsewhere.

So observed market rents and selling prices are not influenced by the ongoing efforts of the landlord/vendor, they have already discounted them.

(The only counter-counter argument is the one advanced by Steven_L a while back of the "superstar" neighbour, people will pay a bit extra to bathe in the reflected glory of living near somebody famous. Well, perhaps they do, but I'm sure the effect is immeasurably small, it is only if you get lots of famous people living on a particular area that it makes much difference).
A friend and fairly enthusiastic LVT supporter on a high-ish salary recently bought himself a house in the south east which was of course eye-wateringly expensive.

His new argument was that LVT would push him into negative equity, so either it would have to be phased in very, very gradually or there would have to be some relieving measure for people like him, so that they don't end up paying the ground rent twice: once to the bank (mortgage interest) and again to the government (LVT).

Fair enough, phasing in is always a good idea, but the obvious counter-arguments are:

1. He would more than break even on a shift from taxing income to taxing location values. If the LVT is deducted from his salary like PAYE, his net pay (more LVT, less income tax) will increase over time. Even if it goes down a bit, so what, people adjust.

2. Negative equity is largely a psychological problem. What matters is the monthly payments, which we are assume are fixed. So the bank can just write down the nominal value of the mortgage debt and charge correspondingly higher interest rates on the lower balance so that the monthly payments stay the same, the banks total income in cash terms remains the same, and the negative equity thing is fixed.

Thursday 6 April 2017

Crusty old misery-guts of the day (Ros Altmann edition)...

Doctor Rosalind Miriam Altmann (or Baroness Ros Altmann to her friends) has an inactive FCA registration.  So I'm not sure why she is giving financial advice in the Mail Online, but she is anyway and has joined the ranks of the bitter over 40's who want to get the Lifetime ISA binned because they are miserable about being nearly dead too old to qualify for the free £1,000 per annum.

Apparently she "... worries that young people who open one for any reason other than the short-term goal of buying a home will blight their finances for their whole lives."  Heavy stuff?  Well the ex-pensions minister claims "...using this as a pension has significant dangers you may not be aware of" and that the LISA "... is a complex product which could leave millions of young people poorer in retirement."

As per usual, Ros claims that the under 40's are too thick to understand they will lose any employer contribution if they opt out of workplace schemes in favour of the LISA.  Whilst she claims to support the Help to Buy ISA, she hypocritically states that young people desperate to buy property will shun pensions saving in order to save a deposit.  But this is only the start of the doublethink.

You see LISA's will hurt high rate taxpayers under 40.  Too stupid to work out that a 40% tax rebate is more than a 20% bonus, in the world according to Ros, the top earning 15% or so of the population will save in the wrong product.  But then again LISA's will only benefit the rich.  Because the basic rate taxpayers who can afford to use a LISA (with its minimum £25 a month contribution) after paying into an occupational pension scheme are rich aren't they?  Or God Forbid! people's parents will give them money.

The usual guff about the 25% penalty for early withdrawal(*) is trotted out too.  But the best bit, the real icing on the cake is this beauty:

"...pensions are taxable on withdrawals beyond the 25 per cent tax-free lump sum in later life. This deters people from spending the money too soon, which is the right behavioural incentive.
The incentive with a Lifetime Isa will be to take all the money out around age 60, and have nothing left for your 80s - in other words, the features of the Lifetime Isa mean it is designed NOT to last a lifetime."

Yes, the fact that for a basic rate taxpayer, LISAs are tax free on the way in AND on the way out is a disadvantage of the product!  Well I opened mine with Hargreaves Lansdown this morning and I'd encourage anyone else under 40 to do the same thing.

The banksters probably want get the policy binned in favour of more direct subsidies like Help to Buy where bonuses are only paid when the punter takes out a bank loan.  Whilst miserable old gits like Ros would quite simply rather the money was spent on people over 40 like themselves.

Of course the other drawback for the establishment is that if young people start paying attention to global financial markets, they might notice things like UK house prices being flat to down in all other major currencies over the last decade. Or that the US stock market has returned 250% since April 2007 in pounds sterling terms - yes, 250% even if you invested before the crash.  And we can't have that can we?  Who will buy all the overpriced houses from coffin-dodgers like Ros?

(*)pensions have a much greater 55% penalty for early withdrawal and £billions has been lost to pensions liberation scams because the government are too crap to regulate the pensions industry, but HMRC do still send the 55% bill to the fraud victim.

Killer Arguments Against Citizen's Income, Not (9)

Emailed in by Shiney, John Kay trots out the usual half-hearted waffle. On the facts, he is not too far off the mark most of the time, but a lot of it is unfounded conjecture. The response to most of his KCN's must surely be: "So what?"

A few highlights:

A third, more mundane, argument for basic income observes that social welfare systems across the world have become extremely complex. Proponents of basic income argue that the scheme can achieve the objectives of welfare systems more effectively and at much reduced administrative cost.

Correct, which is what got me interested in the idea in the first place.

Putting Housing Benefit and disability benefits to one side, we have so many overlapping benefits and tax breaks, that by and large it all cancels out. Being fiscally neutral and without changing tax rates, you can replicate the end result (after welfare payments and tax deductions) within +/- £10 a week for 90% of UK citizens by giving everybody a single, flat-rate welfare payment (equal to current income support rate) and getting rid of the tax-free personal allowance and lower NIC threshold.

Call that mundane if you will, it would make the world a better place. Perhaps only a bit better, perhaps a lot better, but better.

Figures for basic income come from a variety of sources. The French figure is the minimum stipend of €750 per month proposed by Hamon, and the Swiss figure is that which was put forward for the 2016 referendum.

That bit about Switzerland is bollocks, the referendum mentioned no specific figure at all. The opponents managed to persuade people that it would be a stupid large figure like CHF 2,500 a month, not even I would have voted for that.

The lowest figures for basic income cited in Table 1 are those from the UK [i.e. about £74 a week] and Finland. This is no accident because, in contrast to the other proposals, the British and Finnish figures are not plucked from the air. The UK figure is based on the Green Party’s 2015 election manifesto, which is derived from a conscientiously conducted cost appraisal by the Citizen’s Income Trust. [Thanks, I sweated blood doing those] The Finnish figure is that used in that country’s current experiment...

In both countries, the level of basic income is below 20% of median full-time earnings.

So what? Income support is 20% of median full-time earnings at present. I'd rather have a flat £74/week citizen's income, no questions asked, than be subjected to all the form-filling, means-testing, interviews, clawbacks, penalties if I find work, and penalties if I don't system.

While the details of such calculations would vary from country to country, the essentials remain the same, and the conclusions inescapable. The provision of a universal basic income at a level which would provide a serious alternative to low-paid employment is impossibly expensive.

That is a valid argument against pie-in-the-sky Citizen's Income of £200/week, it is not an argument against a sensible £74/week. That's clearly not an "alternative" to low-paid employment, it is in addition. Like the right to vote or send your kids to a state school, those aren't alternatives to low-paid employment, they are in addition.

Housing costs are the largest component of the budget of almost all households and a particularly large proportion of the budgets of poor households.

Then keep subsidies for housing/Council Tax outside the system, that's a separate topic.

On examination, basic income cannot fulfil the aspirations of its proponents.

Yes it can. I'm a staunch proponent with a relatively modest proposal and modest aspirations which would easily be fulfilled (and real life evidence says, surpassed).

But it is hard to imagine a just system which would make no distinction between the millionaire’s spouse who routinely enjoys lunch with her friends while a nanny looks after the couple’s children and the single parent who must stay at home with her (or, occasionally, his) young and needy children, even though the other personal circumstances of the two [three?] may, in a formal sense, appear more or less identical.

Yes it is easy to imagine. If you get a few basic variables correct, all three of those people would end up with the same amount of money, give or take £10 a week (assuming freebies for single mothers are phased out over a few years instead of immediately so that they can adjust - find a job, find a partner or simply stop having kids). Is he saying that they get the wrong amounts at present? By definition, he must be.

Any method of reorganising tax and benefit systems which is even approximately revenue-neutral has winners and losers...

Correct. So what? A lot of these winner-loser comparisons are totally incorrect anyway, as critics of any sort of welfare system (current one or Citizen's Income) vastly over- or under-estimate how much people actually get now, or would get under CI, so they are comparing two wrong figures.

... if it did not, the outcome would reproduce the status quo and the reform would have little purpose.

Yes it would. Replace a thousand pages of legislation with one or two and replace a hundred thousand bureaucrats with standing g orders and more fraud investigators.

Analysis of this redistribution is strikingly absent from almost all discussion of basic income: who is it that receives too much under current arrangements and who too little?

Malcolm Torry has analysed this to death. Broadly speaking, it's a few hundred thousand unemployed single mothers who would get noticeably less (in the absence of some phasing out).

That is not to say that they get "too much", that is a moral judgement, and it is not to say that others get "too little". Daily Mail and Guardian reader can bicker over that sort of crap.

Basing the entire welfare pyramid of piffle on a few hundred thousand single unemployed mothers is like basing the entire taxation system on the narrow interests of a few hundred thousand Poor Widows In Mansions. Ah... right, that's exactly what we do.

If reform is revenue neutral, in the sense that the overall amount spent on welfare is to remain broadly unchanged (including for these purposes the foregone tax from the initial allowance and any substantially reduced lower bands of income tax as welfare payments), then the redistribution would be primarily amongst poor households.

Probably correct, but so what? It's like extending the right to vote to women, by definition, men collectively lose half their voting power. So what?

Attempting to turn basic income into a realistic proposal involves the reintroduction of elements of the benefit system which are dependent on multiple contingencies and also on income and wealth.

Nope. The only people suggesting loads of tweaks are people like him (read his article, it is a long list of unworkable tweaks with no real policy rationale behind them).

I share Piachaud’s conclusion that basic income is a distraction from sensible, feasible and necessary welfare reforms.

Propose some then, your article is full of totally daft proposals and largely unfounded carping. Whoever proposes something sensible is usually making steps towards a Citizen's Income.

As in other areas of policy, it is simply not the case that there are simple solutions to apparently difficult issues which policymakers have hitherto been too stupid or corrupt to implement.

That is exactly how it is. It is a simple - and better - solution to difficult issues and politicians and civil servants are stupid and corrupt. The Tories are currently spending more money on civil servants to harangue and harass claimants than it would have cost just to pay them their benefits. That looks pretty stupid and corrupt to me.

Wednesday 5 April 2017

Free School Powered Rent Seeking

Building on MW's previous posts.

Spotted at Guido Here

It's a gift that just keeps on giving.


It has occurred to me that there may be another lesson to learn from this. That when people are able to make their own settlements for the education of their children then they are getting what they want rather than what a bureaucrat wants them to have.  This is clearly valued.  So the lesson here is not just that subsidies returns to rents but also that rents are higher when people perceive that better services are available, and in this case it means that they think more of education they have more control over than that provided centrally. 

"No deal is better than a bad deal"

This is a tired old debate, see e.g. here.

If you think rationally, there's no reason the UK needs a specific post-Brexit "deal" at all. What if we had never joined? Let's try and get to where we would have been had we never joined.

You have to look at things from an international/third country point of view to judge whose behaviour meets accepted norms: ask yourself: "Which neutral third country will raise an eyebrow at this?"

If I were in charge, here are a few initial thoughts...

1. The UK will say all EU citizens currently in the UK and able to support themselves (or whose partners/family support them) are welcome to stay as long as they like, after six years they can apply for a UK passport under normal rules. There is no earthly way we can chuck significant numbers of them out, even if were not totally inhumane, so let's not even entertain that notion. Paying students are welcome!

Which neutral third country will not think we are being very reasonable?

2. "A quarter of NHS staff are from EU member states", blah blah. A lot of those are Irish citizens, who AFAIAA have always been treated pretty much on a par with UK passport holders (right to move here, work, vote etc). And there are just as many non-UK, non-EU workers in the NHS, they'll all stay.

Which neutral third country will raise an eyebrow at this?

3. As to the future, they can forget about automatic freedom of movement, the UK government has to pander to its own crowd here. If we have sensible rules, quite possibly there will be just as many people from the EU coming to work here in future, but at least we can tear up the Human Rights Act and deport foreign criminals every now and then to keep the home audience happy.

Which neutral third country - all of whom have their own rules - will raise an eyebrow at this?

4. We will unilaterally abandon all tariff and non-tariff barriers. We have our own rules on consumer protection, health and safety, farming and so on, if goods and services comply with these, they can be imported. This applies to the EU as much as anywhere else. If foreign banks want to do business here, they have to comply with our rules etc. Applies equally to banks from France or from the Fiji Islands.

Which neutral third country will raise an eyebrow at this?

5. If the EU wants to play silly buggers and impose trade barriers on us, well so be it, we'll have to sell more elsewhere. Merkel said a proper trade deal would take ten years (probably true), in which case we'll have to get used to living without one anyway, so big deal. If France wants to discourage UK tourists by making them get in the long queue at passport control, we'll sun ourselves elsewhere for a week, thank you very much. If the EU wants to make life difficult for UK banks, it's hard to have much sympathy with UK banks, given how rapacious and malevolent they are. If EU countires start expelling British ex-pats en masse...

Which neutral third country will think that the EU is being fair and reasonable?

6. Under the general rule on succession of treaties, the UK will benefit from dozens of existing favourable treaties which the EU has with third countries, that follows automatically, so saying that we won't is EU nonsense.

Which neutral third country won't be perfectly happy with this?

7. They can forget about that €60 billion "divorce bill", as somebody pointed out in City AM, we can make an equal and opposite claim.

Which neutral third country will be bothered either way over such petty squabbles?

8. There are loads of pan-European treaties and agreements like EHIC cards, Open Skies, delayed flight compensation and so on, which IMHO is all good stuff, but most of these have little to do with the EU and were agreed on an inter-governmental level. It's the same with things like extradition treaties, being in NATO, intelligence sharing, patrolling the Mediterranean to repel illegal immigrants, being a member of the UN and so on, all these have to be judged on their own merits and will continue in exactly the same fashion.

Which neutral third country will want to expel us from all these agreements?

9. Why do we need one all-encompassing agreement anyway? This is madness! The UK is in an intricate web of treaties, conventions, dealing with all manner of stuff. I'm not aware that we have a specific country-to-country agreement covering everything with Brazil or The Phillippines or Turkey, we still get along just fine (or not, as the case may be), why do we need one with the EU-bloc?

Which neutral third country will raise an eyebrow at this?

10. Gibraltar? Don't make me laugh. What the heck does that have to do with anything? If Malaysia were to decide to leave ASEAN and Thailand then demanded border adjustments, would the "international community" not see that as totally unreasonable? Aren't Spain and the UK both in NATO?

Which neutral third country will think that Spain is behaving reasonably, apart from Argentine?

I'd put all of this to them quietly and discreetly and ask how they intend to respond. If they want to save face, they can present most of the above as concessions that they have wrung out of us and present the bits they don't like as a noble and gracious compromise on their part. We can do the opposite, that's fine by me.

If they come up with the usual threats, then we go public, we publish our negotiating position and their list of demands and threats and let the court of public opinion judge the matter

Sooner or later (the sooner the better), the UK will merrily press on and do exactly as outlined above anyway, it's merely a question of giving EU politicians a chance to put a favourable spin on things - they have their own home audiences to pander to as well, fair enough.

End of.

Tuesday 4 April 2017

Something Really Good to come out of Brexit


If I'd've known that successfully voting Leave would would also come with the added benefits of (even partially) shutting up the smug git, I would have been doubly cheerful..

Rail-powered rent-seeking

From City AM:

Housebuilders have added to the call for the government to firmly commit to Crossrail 2, saying it will be crucial in helping address the capital's housing crisis.

Some 66 homebuilding and property figures, including representatives from Taylor Wimpey, Berkeley, British Land and Derwent have written to the government saying the infrastructure project will help unlock new homes, as well as commercial space...

In the letter, the homebuilding and property representatives, argue the new railway will transform transport capacity, as well as connectivity, for underdeveloped areas of the capital like the Upper Lea Valley. Housebuilders said it would give them the certainty to accelerate the development of up to 200,000 new homes.

Tony Pidgley, chairman at Berkeley, said: “Crossrail 2 is a fantastic opportunity to improve London and the South East’s infrastructure, and will help us build the homes this region desperately needs."

Could they be any more blatant when they are holding out the begging bowl?

City AM makes the fundamental error of believing its own propaganda, it is so hard-core Home-Owner-Ist that it somehow thinks this is normal, that the point of spending taxpayers' money on railways etc is to generate bigger profits for land bankers.

The other point being that all these lovely new roads and railways will do naff-all do "address the capital's housing crisis", it will merely stoke demand and attract yet more people/businesses and rents and prices will not fall in the slightest, they might even go up on the whole. To put it crudely, if they really wanted to do something about "affordability", they could just shut down London transport and rents and prices would plummet.

Cannabis powered rent-seeking

Emailed in by Mombers, from the NY Times:

QUINCY, Mass. — At the edge of an industrial park in this suburb south of Boston, past a used-car auction lot and a defunct cheese factory, is an unmarked warehouse bristling with security cameras and bustling with activity. Until recently, the cinder-block structure was home to a wholesale florist, a granite cutter and a screen printer. Today, it is home to just one tenant: a medical marijuana operation called Ermont...

And because the marijuana business comes with added baggage, landlords and property owners are charging a premium for new tenants working in the cannabis business. In Quincy, Ermont is paying above market rate for the previously dilapidated 36,000-square-foot building...

Commercial real estate developers say they have never seen a change so swift in so many places at once. From Monterey, Calif., to Portland, Me., the new industry is reshaping once-blighted neighborhoods and sending property values soaring.

In some Denver neighborhoods, the average asking lease price for warehouse space jumped by more than 50 percent from 2010 to 2015, according to an industry report. In the city over all, there are five times as many retail pot stores as stand-alone Starbucks shops.

Thus neatly proving two points at once; a) legalising cannabis makes an area more attractive on the whole (so is a good thing) and b) a large chunk of the extra value generated by any business accrues to landowners.

Seeing as part of the reason for legalising is to save wasting taxpayers' money on enforcement and collect taxes from the product instead (win-win), if the government can also tap into those higher rental values via higher property tax receipts (as most US states do), it's a win-win-win.

Monday 3 April 2017

Fun Online Polls: Encryption & Government Guidelines for Physical Activity

The results to last week's Fun Online Poll were as follows:

Should services like Whatsapp be made to pass on messages to the police if they obtain a warrant?

Yes, same rules should apply as to any other search warrant - 69%
No, the police should not be allowed to do any searches at all - 31%

Good, I was with the majority on that one.

For sure, on a technical level, Whatsapp might not be able to reconstruct the clear text of the message, but at least they can pass on what they do have i.e. the 'envelope', i.e. time sent, to whom, number of characters, the garbled version of the message, a list of that 'phone users contacts etc.
From the BBC:

More than 20 million people in the UK are physically inactive, according to a report by the British Heart Foundation.

The charity warns that inactivity increases the risk of heart disease and costs the NHS around £1.2bn each year...

Women are 36% more likely than men to be classified as physically inactive - 11.8 million women compared with 8.3 million men.

The report defines "inactive" as not achieving the government guidelines for physical activity of 150 minutes of moderate intensity physical activity a week and strength activities on at least two days a week.

So that's this week's Fun Online Poll:

"Do you achieve the government's guidelines for physical activity every week?"

Vote here or use the widget in the sidebar.