Home-Owner-Ism and rent seeking taken to its logical conclusion

Excellent article about a specific case from the BBC with lots of gory details.

Worth reading in full, there's no point me summarising.

Sounds like a massive rent seeking scam to me.

From The Guardian:

Countries and organisations planning to host events at vital UN climate talks in Glasgow next month have said they fear that increased costs at this year’s event will cause problems for developing nations.

Multiple participants said that the cost of renting Cop26 pavilions – event spaces for hosting workshops, panel discussions and keynote speeches during the conference – is considerably higher than it was at Cop25 in Madrid, with some saying it had increased by as much as 30%.

Organisations say they were told that a combination of Brexit and the pandemic were to blame for the high costs. It comes after the Financial Times reported that one organisation was quoted nearly £500,000 for its space.

The total rental value of such a site relates purely to how many 'customers' you can meet and how much money your wring out of them and/or how much 'greenwashing' you need to do. Sure, post-Brexit, wages for skilled labour have gone up (that was an argument FOR Brexit) but the real costs come off the total rental value to give a lower pure rent. If the real costs were more than the total rental value, nobody would want to exhibit.

So neither Brexit nor the pandemic were to blame, the rents here are a function of how much money is sloshing around the whole 'environmental-industrial complex'.

(As Treasurer for the Labour Land Campaign, I had to sign off a payment for our stand at this year's Labour Party conference, that was a couple of grand just to have a table with leaflets for two or three days. If - big if - they can drum up a hundred new members chipping in their sub's for a couple of years, it was worth it, in purely commercial terms.)

Don't worry lads! The government has finally worked out how to fix the economic crisis caused by their overreaction to the covid-19 scare...

From financialreporter.co.uk:

The Government is in talks with The Home Builders Federation, whose members deliver around 80% of new homes built each year, about extending the scheme to help support the industry after Covid-19 lockdown measures are lifted, according to The Times.

Sorry, what was that first bit... "The Government is in talks with The Home Builders Federation..."? I'm sure the HBF will politely explain the economics of the housing/land market and explain that land prices will always rise to soak up the subsidy and that there are far better ways of spending taxpayers' money.

The shutdown of construction work and sales offices is expected to have a long-term impact on the sector, with Savills estimating that the lockdown will hinder the construction of around 200,000 new homes.

Wot? They are building on average 200,000 homes per year; do they expect the lock down to last a year? (For all of our sakes, I hope it doesn't).

Since the launch of the Help to Buy: Equity Loan scheme in April 2013, 248,075 properties have been bought, with first-time buyers accounting for 81% of total purchases.

That proves nothing. It's an arms race. If other people can bid more because they've tapped into the subsidy, then you have no choice except to tap into the subsidy and bid a bit more as well.

The current Help to Buy scheme is due to end in April 2021. A new scheme will then run for two years, restricted to first-time buyers with regional property price caps.

But finally they've found an excuse to extend it. Phew, I was getting worried there.

"The Landmine that Just Got Laid for Elizabeth Warren"

From PoliticoMagazine:

The moment came when the 10 participants were asked, by a show of hands, who would dispense entirely with private health insurance. Only New York Mayor Bill de Blasio and Warren signaled “yes.”

That's when former Rep. John Delaney, one of the least visible of the 24 announced candidates, weighed in. After pushing back on the idea of taking something away from Americans that most are reasonably happy with, Delaney said this:

“Also it’s bad policy. If you go to every hospital in this country and you ask them one question, which is how would it have been for you last year if every one of your bills were paid at the Medicare rate? Every single hospital administrator said they would close. And the Medicare for All bill requires payments to stay at current Medicare rates. So to some extent we’re basically supporting a bill that will have every hospital closed.”

The writer reckons that the Republican candidate (i.e. Donald Trump) will repeat this endlessly during the next campaign - "Even Democrats admit that their plan will have every hospital closed."

The problem is that the claim is nonsense to start with.  Delaney is presumably in the pay of the US healthcare lobby, a massive rent-seeking enterprise, which charges about three or four times as much for treatment as the nationalised/regulated systems in Europe, and 'hospital administrators' are hardly going to admit they have been price gouging for decades, are they?

European healthcare works fine and there are plenty of hospitals, so assuming Medicare payments are at European levels, nothing terrible will happen. They'll just make normal profits and earn normal salaries instead of making super-profits and earning inflated salaries. Coverage will improve and the US economy will grow by ten or fifteen percent; the US healthcare lobby is currently soaking up about ten or fifteen per cent of US GDP in super-profits.

That said, trying to ban private health insurance is a daft idea and entirely unnecessary, as the European example shows. If you have private insurance, you get much the same treatment as under the default system, just at double or treble the cost. Which is why most people don't bother.

Faux Lib bullshit of the week

From The Daily Mail:

Senator Bernie Sanders' 'Medicare for all' plan would increase government health care spending by $32.6 trillion over 10 years, according university study.

The latest plan from the Vermont independent would require historic tax increases as government replaces what employers and consumers now pay for health care, according to the analysis being released Monday by the Mercatus Center at George Mason University in Virginia. It would deliver significant savings on administration and drug costs, but increased demand for care would drive up spending, the analysis found...

Responding to the study, Sanders took aim at the Mercatus Center, which receives funding from the conservative Koch brothers. Koch Industries CEO Charles Koch is on the center's board.

OK, divide $32.6 by ten years, and then by 325 million US population = $10,000 a year per person. This would - by implication - be on top of what the US government already spends on healthcare and healthcare industry subsidies, $1.5 trillion a year = $5,000 per person.

Let's give Sanders the benefit of the doubt and assume that people would no longer have to pay for private health insurance, $2 trillion a year = $6,000 per person.

So according to the Faux Libs, the average healthcare spending per person would be $15,000 a year.

By comparison, average healthcare spending per person in Western European countries is about €4,000 a year, at least 80% of which is funded out of general taxation or "income based compulsory contributions" i.e. hypothecated taxes.

So either American doctors, pharma companies and insurers are allowed to earn ridiculous profit margins (and they do - an outrage in itself) or that report is total and utter hogwash. Or some combination of the two. And clearly, the American healthcare 'industry' is a damn' sight smarter than the poor American mugs paying for it.

Bullshit Jobs - David Graeber nails it

From City AM:

Often I talk to people who are efficiency experts for banks who will say they think there’s as many as 80 per cent of the people who work in a given bank probably don’t need to be there.

I think it’s partly because the system we have actually isn’t really capitalism. I would go that far. Capitalism is a system where you are hiring people to make stuff to sell people, or you’re just selling stuff and therefore obviously you want to spend as little as possible and make the most profit.

But increasingly the profits of large corporations are coming from finance, so basically moving money around, creating debt, seeking rents of one kind or another. That’s a whole different thing that’s much more like feudalism where you’re extracting money then redistributing it.

Trump v Amazon: War of the Rentseekers?

An interesting take from axios.com:

Trump’s deep-seated antipathy toward Amazon surfaces when discussing tax policy and antitrust cases. The president would love to clip CEO Jeff Bezos’ wings. But he doesn’t have a plan to make that happen.

Behind the president's thinking: Trump's wealthy friends tell him Amazon is destroying their businesses. His real estate buddies tell him — and he agrees — that Amazon is killing shopping malls and brick-and-mortar retailers.

"When people of the same trade meet together... the conversation ends in a conspiracy against the public"

In the light of that Adam Smith misquote, let's cast a wry eye on this self-preening article in City AM:

There is no need for a “Hippocratic Oath” specifically in relation to tax, as McDonnell called for, since chartered accountants already ensure that taxpayers – individuals, companies, and others – pay the right amount of tax due under the law. In this way, we help reduce the tax gap by supporting good tax compliance.

Of course, it would be naive to hope anyone would take this purely on trust. Which is why, in addition to being subject to legal requirements, chartered accountants and members of other professional accountancy bodies are also required to follow a professional code of ethics...

But what is rarely mentioned is that almost a third of registered tax advisers are not members of any professional body. This means they are not required to follow any ethical or professional standards at all. If politicians truly wish to get tough and raise standards, ensuring that the high bar set by the chartered profession is applied across the board would be a good start.

Sub-text: raise barriers to entry by "regulating" everybody who isn't a Chartered Accountant, who nobly "self-regulate".

How effective is that "self-regulation"..? From The Daily Mail:

Britain’s big four accountancy firms have been savaged by MPs who have accused them of “feasting on the carcass” of collapsed construction giant Carillion and collecting more than £70 million in the process...

Veteran Labour MP Frank Field, head of the Work and Pensions Committee, said: “The image of these companies feasting on what was soon to become a carcass will not be lost on decent citizens. The former directors of Carillion are, unlike their pensioners, suppliers and employees, alright.

“These figures show that, as ever, the Big Four are alright too. All of them did extensive – and expensive – work for Carillion. PwC managed to play all three sides – the company, pension schemes and the Government – to the tune of £21 million and are now being paid to preside over the carcass of the company as Special Managers.

“It was perhaps telling that, with their three fellow oligarchs conflicted, PwC were appointed to this lucrative position without any competition.”

According to information published by the committees, KPMG has banked £20.2 million in fees since 2008, PwC £21.1 million, Deloitte £12 million and EY £18.3 million.

So 'not very' and yet again, we are presented with evidence that they are actually thieving scum.

More London taxi-based rent-seeking fun

From The Daily Mail:

The number of Uber drivers in London should be capped to ensure 'healthy competition and consumer choice', the boss of a rival minicab app has claimed. Kabbee chief executive Justin Peters called for a limit on the proportion of minicab drivers overseen by one company if Uber overturns a decision not to renew its operating licence.

'Nuff said.

From The Evening Standard:

An "extortionate" rise in licensing fees for private hire car operators in London will force thousands of drivers out of work and close hundreds of cab firms, it was claimed today. Transport for London has approved increases that will see five-year fees leap from less than £3,000 to £700,000 for some operators.

The charges, which last rose in April 2013, depend on the number of cars run by firms. Those with between 101 and 500 will see their licence fee jump from £2,826 to £150,000. Operators with 501 to 1,000 cars will see their bill jump from £2,826 to £350,000 over five years, while those with 1,001 to 10,000 cars will see their fee go from £2,826 to £700,000.

1. TfL is doing a bit of bureaucratic rent-seeking here. It's budget is about £200 for each driver and each car per year for monitoring, which is of course way too high.

2. If it really cost this much (which it doesn't), it would seem reasonable to charge £200 per driver and per car a year. So if anything the charges are too low.

3. A minicab business with 10,000 drivers is only paying £14 per driver per year (£700,000 ÷ 5 years ÷ 10,000 drivers). This is a slap in the face for a business with 1,001 drivers, which has to pay £140 per driver per year (the same calculation applies in every band) and acts as a sort of barrier to entry/growth. The marginal hit from going from 999 to 1,001 drivers is more or less infinity for those last two drivers.

4. Nonetheless, those charges aren't huge, absolute maximum about £3 per driver per week, divide that by a few dozen journeys and it's next to nothing. If they add that to their fares, it is not going to make a measurable difference to quantity demanded, so the claim that this "will force thousands of drivers out of work and close hundreds of cab firms" is complete and utter bollocks.

"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).

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.

Your taxpayers' money, hard at work.

Spotted by Lola in The Telegraph:

Inflation is officially back, and by the end of this year is expected to hit 2.3pc, above the Bank of England’s 2pc target. In a world of rising prices, investors need exposure to assets that can keep pace.

Investing in infrastructure projects – such as motorways, schools or hospitals – that are inflation-linked is one way to protect the value of capital. These projects also produce a reliable income, with the trust currently yielding 5.1pc...

Andrew Charlesworth, manager of the £1.2bn John Laing Infrastructure trust, says that investors should not worry about buying at a premium, and explains how he made 36pc on a London hospital and his role in President Donald Trump’s plans.

The only way to make such super-profits is if the government overpaid in the first place; one man's super-profits is the flip side of shit value for the long suffering taxpayer.

"Qatar to invest £5 billion in UK over next few years"

From The Daily Mail:

Theresa May hopes to deepen ties with Qatar after the oil-rich Gulf state announced it will invest £5 billion in the UK over the next few years...

Sheikh Abdullah said: “Over the next three to five years, Qatar will invest £5 billion in the UK economy through various investment funds and relevant parties in Qatar – which will constitute another addition to its already successful investments in the UK.

“Our investments in the UK will focus on energy, infrastructure, real estate, services and other sectors.”

Qatar already has more than £40 billion invested in the UK, including ownership of London’s tallest building The Shard, Harrods department store and the Olympic Village.

This is not "investing" in any meaningful sense, they are collecting rents from the UK economy and subsidies from the UK government (like snapping up the Olympic Village for half price, or buying into top-down privatisations of public services).

Which is what happens when you tax the productive economy and subsidise land (or provide government guaranteed income). Why bother with proper, productive investment (factories, new businesses, innovation etc) when you can just tap into existing government-backed rental streams?

Air Passenger Duty bleating LOLZ

More rent seeking in the City AM:

In one part of Whitehall, the Department for Transport, ministers and civil servants recognise the importance of developing policies over the next decade to help UK aviation to grow sustainably...

But their efforts will be largely in vain if the Treasury cannot be persuaded to abandon hopelessly uncompetitive APD rates that are a major obstacle to UK businesses seeking to follow the Prime Minister’s lead by going into the world and building new trading relationships...

Of course, it is good news that the government has given the green light to the construction of a new runway, but the fact is that we will massively reduce the impact of expanding aviation capacity if we don’t have a competitive tax regime that will enable us to take advantage of it...

The government should also ensure that aviation-related negotiations and decisions are prioritised during the EU withdrawal process – but unless the UK tax environment is competitive, all the air services agreements in the world won’t make it viable for airlines to open new routes to and from the UK.

A few facts:

Gatwick and Heathrow are running at close to 100% capacity, so by definition, APD cannot be reducing the number of flights there. APD might have a marginal impact on the number of flights at less popular/regional airports, but the rentiers don't care about 'the regions'.

The bulk of the value/price of an airline ticket is where you are flying to and from and at what time of the day etc, the actual cost of doing it is surprisingly small. Compare the price of a ticket from Stansted to Riga with the price of a ticket from Heathrow to Berlin, or the price of a very early/late flight with one in the daytime! The difference in price is rent/location value.

Admittedly, APD is a dreadfully clunky way of collecting part of the rental value, but compared to VAT-liable businesses, airlines are still getting a fairly good deal overall:

Air transport is VAT zero-rated. That means that they can reclaim all input VAT but do not have to charge VAT, a best-of-both worlds status also enjoyed by 'home builders' and proper exporters.

Total revenues of UK airlines £22 billion per annum.

Total UK APD revenues £3 billion per annum.

Ignoring the fact that UK airlines also have non-UK revenues and some APD is payable on flights with non-UK airlines, passengers are paying £25 billion all in.

If air travel were VAT-able, the VAT due would be one-sixth of that = £4.2 billion, a lot more than the £3 billion they are actually paying.

Under the circumstances, it would probably be better to get rid of APD and impose VAT instead; that would bear more heavily on flights to and from Heathrow and Gatwick and would reduce the tax paid on flight to and from less popular/regional airports, as well as collecting a larger share of the rental income. The problem then would be collecting VAT from non-UK airlines, I'm not sure how you'd enforce that.

So as ever, the best kind of tax on air travel is a charge on the value of the landing slots, whether the airlines pay it directly or it is included in the Business Rates assessment of the airports is by the by. Airports themselves are probably in the best position to negotiate this and they can just add it to their landing fees.

Heathrow wants a new runway? Fine, they can haggle with HM Treasury over what the extra Business Rates will be; they are in the best position to work out how much extra pure profit they can make. HM Treasury can run a parallel auction with Gatwick, and whoever bids the most is allowed to build a new runway.

Sorted.

"Obama Administration Bails Out Private Equity Landlords at the Expense of the Middle Class"

Emailed in by TBH from Naked Capitalism.

A fairly long article, concluding with this:

Let us stress that there is absolutely no policy justification for this. The mission of the government sponsored agencies is to promote home ownership, not to give real estate speculators a “get out of losses or underwhelming returns for free” card.

Even worse, rather than forcing the private equity industry to take some well-deserved lumps for miscalculation, it will encourage them to continue to compete with lower-income prospective homeowners for purchasing properties. That means it will be even more difficult for young people to buy homes.

Lambert has pointed out repeatedly in his stats wrap in Water Cooler that real estate markets are suffering from a shortage of homes. Having private equity continue to be on the prowl for lower priced properties that they know they can unload from an economic perspective means that the pauperization of the middle class is now official policy.

The UK: A house price based economy with a house price based currency (2)

From The Telegraph:

Professor Mody, who led the EU-IMF Troika rescue for Ireland, said the pound had been driven up to nose-bleed levels from 2011 to 2015 by global property speculators and the banking elites acting in destructive synergy, causing serious damage to Britain’s manufacturing base and long-term competitiveness...

“It was essentially a bank-property nexus, and the rest of the economy was left to suffer. It is stunning that just 1.4pc of all loans were going to the manufacturing sector,” he said. The country was suffering a variant of the ‘Dutch Disease’, although in this case the problem was over-reliance on finance rather than commodities.

“Britain was borrowing 5pc to 6pc of GDP a year to buy imports and live beyond its means. The strong pound was great if you wanted to buy a Mercedes Benz of take a holiday in Spain, but the prosperity was an illusion, borrowed from the future,” he said.

Prof Mody said the pound was 20pc to 25pc overvalued in trade-weighted terms before the Brexit campaign got underway, based on classic IMF measures of the real effective exchange rate (REER). This currency distortion would have inflicted deep damage if it had been allowed to continue for another five years.

I pointed out two years ago that GBP and house prices tracked each other very closely from 2004 to 2014, I ought to update that chart and see if it still holds, but as a generalisation it does: "Brexit fears" have clearly been a fairly direct cause of high end London land prices falling (fewer foreigners want to buy here) which in turn reduces demand for GBP and hence leads to GBP falling.

The UK's trade deficit is about £100 billion a year. What do the foreign exporters do with the GBP they accumulate? They like buying up things in the UK which will provide rental/super-profits/unearned income: shares in UK companies, commercial land and buildings, 'privatised' utilities, high-end London residential, student accommodation and things that will entitle them to government-guaranteed payments (Sizewell B, farmland, UK government bonds etc.

This is a vicious spiral of course. Every year the UK as a whole is poorer by the amount of rent which seeps abroad, enabling foreigners to buy more UK rental streams ad infinitum.

So what would happen if we got rid of these subsidies; started taxing rents/monopoly income more and production/wages less; and reduced public sector deficit to zero? Foreign manufacturers and farmers will still be happy to sell us stuff, they are geared up to producing and selling as much as possible.

What will they do with the GBP they receive for what we import? They are welcome to buy land, but most of the value will go back to the UK Treasury as tax instead of seeping abroad as rent. So they will spend much more of their GBP on UK produced goods and services. Or maybe they will sell us less stuff while buying the same amount from us. Either way, it would do wonders for the balance of trade.

"Virtuous Rent: a Rudder That Can Transform Our Economy"

A great article from Evonomics forwarded by SJS. Worth reading in full (quite lengthy) but here is the salient bit:

In Adam Smith’s view, landlords benefited from land’s unique ability to enrich its owners “independent of any plan or project of their own.” This ability arises from the fact that the supply of good land is limited, while the demand for it steadily rises. The effect of landowners’ collection of rent, he concluded, isn’t to increase society’s wealth but to take money away from labor and capital. In other words, land rent is an extractor of wealth rather than a contributor to it…

More recently, the concept of rent was expanded to include mono­poly pro­fits, the extra income a company reaps by quashing com­pe­tition and raising prices. Smith had written about this form of wealth extraction too, though he didn’t call it rent. “The interest of any particular branch of trade or manufac­tures is always to widen the market and to narrow the competition… To widen the market may frequently be agreeable enough to the interest of the public; but to narrow the competition must always be against it, and can only serve to enable the dealers, by raising their profits above what they naturally would be, to levy, for their own benefit, an absurd tax upon the rest of their fellow-citizens"

… In short, traditional rent is income received not because of anything a person or business produces, but because of rights or power a person or business possesses. It con­sists of takings from the larger whole rather than additions to it. It redis­tributes wealth within an econ­omy but doesn’t add any. As British economist John Kay put it in the Financial Times, “When the appropriation of the wealth of others is illegal, it’s called theft or fraud. When it’s legal, it’s called rent.”

Insane subsidy of the day

From The Daily Mail:

* Uber and other ride-sharing services will be allowed to operate legally [in Queensland]
* Taxis will be allowed to charge surge pricing and will receive $20,000
* QLD Premier announced a $100 million industry assistance package
* Queensland is the fourth Australian state to legalise ride-sharing apps
* The move is expected to anger anti ride-sharing app campaigners

The only reason why taxi licences had value was because they restricted supply, raised artificial barriers to entry, thus pushing up prices for passengers and destroying jobs etc. If the government realises its mistake and changes the rules, why on earth would they compensate the people who have unfairly benefitted in the past? The mind boggles.
-------------------------------------------------
For the benefit of Striebs, this is anathema to left-libertarians; such compensation is the opposite thereof, i.e. rent seeking and wasting taxpayer's money all rolled into one.

I can sort of see the "left wing" argument for subsidising particular activities if at least it increases output and employment or ensures security of supply (although on closer inspection, other factors usually outweigh the apparent gains), but such a subsidy achieves nothing, it does not increase the number of taxis or passenger journeys one iota and costs the taxpayer money so fails from a left-wing perspective as well as from a "libertarian" perspective.

Similarly, I support the "libertarian" case for removing barriers to entry and increasing competition, although this is usually not a left-wing cause (thus putting the lefties in a dilemma - do they want to restrict supply/boost incumbents' wages with permits; or increase supply with subsidies?)

Taxi driver bleating also reminds me of a terrible KLN: "But I paid for my house out of taxed income!" No you didn't, you paid for it out of the money you were saving on rent; by and large, taxi licence holders have collected more in extra income than they ever originally paid for their licences (bearing in mind they were originally issued for low or zero cost).

"Legal services sector costs the UK economy £25bn"

From City AM:

Legal eagles are taking a substantial chunk from the UK's bottom line, as the legal sector is now valued at over £25bn, a report out today has found.

The study published today by the Law Society discovered that every one per cent of growth in the UK's legal services sector sucks an additional £379m out of the economy and destroys 8,000 jobs.

The report also found that the legal sector, which grew by eight per cent from 2014 to 2015 and currently employs around 370,000 people, shrinks the wider economy by £1.39 for every £1 of extra fees and destroys a further 67 jobs for every 100 roles created within the sector.

"The provision of eye watering invoices is fundamental to the success of legal sector and underpins the very fabric of the Law Society," said Catherine Dixon, chief executive of the Law Society. "From high street solicitors to global law firms, and from in-house solicitors to those who operate in alternative business models, we're all at it, every-bloody-where."

… thus neatly proving his opponent's point.

Today's City AM Forum asked "Davos 2016: As the world’s elites ready themselves to attend, is the yearly meeting a complete waste of time?"

Philip Booth laid out his good case for "yes", the key sentence being this:

"Indeed, the whole set-up seems designed to promote the status of “rent seekers” – powerful people in business and NGOs who wish to obtain favours from government."

In putting the case for "no", his opponent neatly illustrated the sort of thing Philip Booth means by "rent seeking":

"Many of the biggest intellectual trends are launched to the mass market at Davos. A few years ago, attendees were issued with fitness trackers, now every ambitious middle manager has one. Then it was mindfulness.

Who knows what it will be this year? The World Economic Forum is the most important salesroom in the world. It is where consultants, management gurus and political advisers go to push their wares. An invite to Davos boosts your day rate.

It is the Paris fashion show for the corporate world. What was on the runway yesterday is on the high street tomorrow. It is also where journalists go to get a sense of what the biggest trends in the world’s boardrooms will be. What people are talking about at Davos this week will become the management fads of a few years’ time."