Sunday, 16 June 2019

Corbyn & Blair Have Both Got It Wrong

This week Jeremy Corbyn and Tony Blair have been having a spat about which of them cares the most about inequality in accordance with Labour party values. They may not be confused at the same level (it's difficult for anyone to be more confused than Jeremy Corbyn about anything) - but watching their squabble unfold is a bit like watching a tarot card reader and an astrologer arguing about the best way to teach astronomy. Both Corbyn and Blair are so far from the truth that their litany of economic nonsense seamlessly blends together to a messy ideology that bears little resemblance to reality.

Here's the reality: in every way that's important to what humans desire in an economic system, the rich have got richer, but the poor have done best of all. As Matt Ridley reminds us in The Rational Optimist, the poor in the developing world grew their consumption twice as fast as the world as a whole between 1980 and 2000. Poverty has been reduced in the world more in the past 50 years than in the previous 500.

What the Blairites and Corbynites need to understand most pressingly about inequality is that it is only by the rich getting richer that the poor get richer (the past few thousand years ought to be demonstrable evidence of this). An in-country increase in inequality is one of the natural and wholly expected consequences of a growing economy - it almost always entails that income inequality widens, because the way a nation spends its money on voluntary transactions is not in a way that transfers income equally to all kinds of people - it is, by and large, a very naturally unequal and democratic merit-based distribution.

To see why, think of your monthly expenditure, once you've paid your tax. The chances are a great proportion of your monthly needs and enjoyment is going to go to businesses already more wealthy than you: a food bill to Sainsbury's, a television subscription bill to SKY TV, a music CD to Amazon (and the artist), a takeaway bill to KFC, a fuel bill to Shell, and so on. All of those voluntary transactions make people already wealthier than you even wealthier, because those goods and services are also being consumed by many others too. The providers are good at providing what people want and need, and because of this, the income distribution among the population is skewed in favour of a small percent of the population. There is no global conspiracy - just natural concentrations of earned income from market choices (for more on this, see this blog post). 

Further, it is because wealth is not a fixed pie that it should be easily seen how the rich get rich and the poor do as well. It is because of all the wealth creation that even the poorest people in the UK and USA are living lives that their forbears could only dream about. When Harold Macmillan uttered his famous phrase that the folk of 1957 had 'never had it so good' - he was speaking to people who were earning less then on full time wages than the average state welfare beneficiary now - particularly when you factor in other ways to be better off, like better standards of electricity, running water, bathrooms, kitchens, cars, entertainment, widespread communication, health care, hand held devices, and unprecedented access to knowledge that even the richest people in the world a few decades ago would have marvelled at.  

There are also other perfectly natural things that concentre income in richer circles purely due to people's freedoms in making choices - such as assortative mating, freer movement of people, and increased competition - all of these liberalising phenomena increase in-nation inequality. But there's more, because what this also does at the same time is reduce global inequality (as I explain more fully in this blog). Countries expand their economies, and in doing so global inequality falls. If you begin with the base error of unjust inequality, as Corbyn and Blair do, your whole narrative is set up to be wrong.

I'll leave you with this nice quote from Matt Ridley, that the Malthusian alarmists would also do well to heed:

"Since 1800, the population of the world has multiplied six times, yet average life expectancy has more than doubled and real income has risen more than nine times. Taking a shorter perspective, in 2005, compared with 1955, the average human being on Planet Earth earned nearly three times as much money (corrected for inflation), ate one-third more calories of food, buried one-third as many of her children and could expect to live one-third longer. She was less likely to die as a result of war, murder, childbirth, accidents, tornadoes, flooding, famine, whooping cough, tuberculosis, malaria, diphtheria, typhus, typhoid, measles, smallpox, curvy or polio. She was less likely, at any given age, to get cancer, heart disease or stroke. She was more likely to be literate and to have finished school. She was more likely to own a telephone, a flush toilet, a refrigerator and a bicycle. All this during a half-century when the world population has more than doubled, so that far from being rationed by population pressure, the goods and services available to the people of the world have expanded. It is by any standard, an astonishing human accomplishment."
Matt Ridley - The Rational Optimist

Monday, 10 June 2019

Placard Theory & How To Know When A Group Is Wrong

I have a theory about people who take to the streets to hold up placards. My theory is, it's not quite an ineluctable law of human behaviour, but if you're the sort of person who would write a statement on a placard and take to the streets with it to join a mass demonstration, there is a very high probability that you're quite a myopic person that isn't very good a seeing situations with a very balanced or broad perspective. I'm not 100% sure the theory is right - but it looks to be highly probable - like the chances of throwing six dice and it being highly probable that you'll throw a number between 10 and 30.

If you're the sort of person who can intelligently think things through, you've probably already thought up something better than holding up a placard, you're probably intelligent enough to realise that standing in the street holding up a placard is not going to do much good, and you've probably already gathered that you are almost certainly going to be surrounded by a mob of incompetence. Hence, the sort of person who would hold up a placard expressing outrage is likely to be someone who has been presumptuous in arriving at a limited and short-sighted conclusion, and sees the world through a very limited perspective.

Here is one of my favourite examples of this:

Given that most decisions, outcomes and ideas have many broad and complex tenets to their execution - this, I think, helps us draw a more generalised probability estimate that if you're the sort of person who would stand on the streets exhibiting *any* placard, you are likely to be the sort of person who is afflicted with the Dunning-Kruger effect: that is, you are so inept that your ineptness means you can't see just how inept you are.
Occasionally though, someone comes along and bucks the trend, like this guy:

Lastly, I have another observation too that's worth adding to this. A general rule of thumb I've noticed is that when ideological groups get together, a good way to predict whether they are wrong is by observing their method of operation. Groups that politicise their agenda, and get their arguments woefully wrong - young earth creationists, socialists, communists and climate change alarmists, to give four prime examples - don't really have any ideas of their own; they exist only like parasites that feed off the facts of things to which they are opposed.
Young earth creationists don't have a single factual claim of why anyone should believe the earth is only 6,000 years old - all they try to do is construct bogus arguments against established science in a way that sounds convincing to the pliable individuals too unapprised to see through the nonsense, but that everyone else knows to be ludicrous. Climate change alarmists spend their lives declaring war on everything linked to progress, but they have not the faintest suggestion of an alternative. Socialists walk around condemning capitalism, while enjoying everything that capitalism has enabled them to enjoy. They lament the rich while not realising that they are among the richest people who have ever lived. These people are the court jesters of our age.
So, whenever you encounter any group who are standing up for a cause that involves interpreting facts about the world - try to determine whether they claim to have any facts of their own - because if their whole agenda is based on a leech-like mentality that only sucks blood from their opponents, and has no factual blood of its own, then you can be pretty sure that they are wrong, and to be given a wide berth. 






Monday, 3 June 2019

We Have Progressive Tax, Why Not Progressive Sex & Progressive Exercise?

I'm going to offer a proposition that will startle you at first, but one which you'll probably then go on to see as intriguing. Imagine what the UK would be like if the government treated sex and exercise the same way it treats income tax.

In the UK we have a progressive tax system, which is a tax system whereby the tax rate of a working person increases as the taxable base amount (their salary) increases. So someone earning £100,000 per year will not just pay more than the average earner in absolute tax due to higher earning, relatively they will pay a bigger proportion of their income too.

I've argued before on this Blog that although we shouldn't assume the rich should automatically pay more tax, it is good for society (and that includes good for rich people) that they do, because rich households have a lot more of their income that is not spent on basic necessities, and thus have more to spare in a way that the poor do not.  

But if we consider what progressive taxation is - the rich doing favours for the poor by having more privileges with which to help - we get into knottier territories, because we can begin to ask why we don't go beyond financial favours into areas like sex and exercise. For the purposes of fun, bear with me for a moment, and imagine this; realising that money isn't the only way that the better off can help the worse off, the government decides to introduce two other kinds of 'progressive' measures to accompany progressive tax - progressive sex and progressive exercise.

The government's reasoning is that if it is intrinsically the right thing to do for those better off to give a helping hand through taxation to those born without the ability or background or circumstances (or all three) to climb up the ladder, they can make additional laws to help out further in areas of sex and exercise too.

The progressive sex law makes those really good looking people give a helping hand through sexual favours to those born without the looks or the confidence to acquire a sexual partner. And the progressive exercise law makes people with more energy go and do the shopping or mow the lawn for those unfit people in society.

You may say that such proposals would disincentivise unattractive people from sprucing up their appearance and trying to meet partners on merit, and that it would disincentivise people unfit people to get off their bums, get fit and mow their own lawn (and you'd be right), but that equally well applies to financial helping hands too - as welfare inspires many to opt for not-working and instead live a more modest life financially.

At this point in the article your mind is probably racing with thoughts as to why progressive sex based on looks and progressive exercise based on fitness are overwhelmingly less desirable than progressive tax based on income. You've probably already thought, as one example, that mandatory sexual favours would be detrimental to marriages and relationships in a way that mandatory income tax is not. You've also probably already thought that being legally compelled to do things with our bodies is an entirely different intrusion on our lives than being legally compelled to do things with the money we earn.
So feel free to relax a bit - although I was only having a bit of fun with the idea of progressive sex and progressive exercise, there is, in fact, a method for ascertaining your differing views on these things. If you consider why it is you support compulsory helping hands in the form of money but not all the other things, you'll find there is a good short-cutting maxim that makes things clearer - it's the philosopher John Rawls' famous veil of ignorance theory of justice, in which ideal moral and ethical systems are implemented through conditions under which "No one knows his place in society, his class position or social status; nor does he know his fortune in the distribution of natural assets and abilities, his intelligence and strength, and the like."
So if we pretend that prior to being born we could all partake in a committee meeting to decide upon the fairest and most just society, not knowing where we'd be in that society in terms of environment, background, and natural talents, we'd (try to) pick the most objectively good one, not the most subjectively good.
In other words, if we had the luxury of voting on a system before we were born, and we didn't know how well off we would be in the gene pool of talent and in the cultural pool of good and bad backgrounds (where good means high earning potential), we'd all vote for a system to be in place whereby those at the bottom are given a helping hand or a leg up by those at the top.
But although we'd probably vote for this in the context of income tax, we wouldn't vote for a system where good looking single people subsidise ugly single people through sexual favours - not least because it would provide an unhelpful incentive for good looking people to be in relationships to avoid this obligation (and as we all know, relationships that are pressure-based and not freely chosen because of love and compatibility are not good.

Perhaps if we'd all been fortunate enough to have a Rawlsian pre-birth committee to decide on the distribution of funds, talents and privileges we'd be able to reach a fair and equitable system. But one thing we'd have to bring to bear is the fact that for every benefit there is likely going to be a cost.

If you give some of my earnings to broke Jack and skint Stephen then their benefit is my cost; whereas if you force sexy Sadie to give sexual favours to ugly Pete and short-on-confidence Dave then you impose a nasty cost on society by creating an exchange of activities above the threshold of what the pre-birth committee would choose. That I think is the best argument we have for picking some kinds of helping hands and not others - some stay within the realms of social-desirability and some don't.

The upshot is that enforced sexual favours are abhorrent, but enforced redistribution of wealth would also be abhorrent were it not for the fact that society benefits overall from it. Don't get me wrong, there are lots of problems with the welfare system - not least the welfare trap and perverse incentives - but there are enough benefits to justify keeping it (even if people don't like it as much as they say they do). Although enforced redistribution of wealth is undesirable in the context of a mugging, burglary or bank robbery, it is desirable in some cases when it is formalised by governmental societal practices (even though politicians do often resemble the mafia.), especially as a safety net makes bold innovation less of a risk, and short-term unemployment welfare benefits gives us time to find a job that best matches our skills and talents to the new position.
Leaving aside the bit of fun we had with the progressive sex and progressive exercise propositions, I said a moment ago that if we pretend that prior to being born we could all partake in a committee meeting to decide upon the fairest and most just society, we'd try our hardest to pick the most objectively good one, not the most subjectively good. To see why, suppose just ten people are in this committee meeting.

Translating environment, background, and natural talents into earnings, you learn that one of you is going to take home £750,000 per year, and the other nine are going to take home under £15,000 per year, with two of that nine taking home absolutely nothing (for argument's sake, due to disability and a troubled background). The ten of you get to vote on two systems: system 1 leaves things as they are, and system 2 incorporates redistributive policies that taxes a chunk of the £750,000 and apportions it down the shallow end of the earnings pool. All ten of you are almost certain to vote for system 2, because while you have a 1 in 10 chance of being the high earner, you have a 9 in 10 chance of struggling by on under £15,000 per year, so no individual would be wise to vote for system 1.

Extend that to everyone in society, and regarding your own position you'll see why from behind a veil of ignorance it's rational to desire an objectively fair and just system to ensure those in the deep end of the earning pool help those in the shallow end. Given that if it were possible we would all sign up to be on that committee, there is a reasonable case for arguing that in the absence of such an opportunity the next best alternative is democratically appointing a government that enforces these systems.

Obviously everyone disagrees on what that optimal governmental system looks like, but apart from very extreme libertarians, most of us agree that the system of political representatives is pretty much the next best thing to a Rawls-esque veil of ignorance committee. Obviously a system built entirely on beneficence would be susceptible to misuse and disincentive for the worse off to help themselves up the ladder, but some kind of government controlled system could work well, even if it isn't this one.

What we have at present is a central government that tries (sometimes well, often poorly) to put a simulation of this in place on our behalf by redistributing money gathered from taxation. In a perfect world everyone who has plenty would help everyone who has little - at least to the extent of offering a helping hand related to hardships people suffer that are not of their own making. 

Perhaps the most coherent argument against excessive government intervention in the market economy is Hayek’s ‘local knowledge’ problem - which basically states that no state agent can possibly have sufficient knowledge of a complex aggregation of individual decisions in society, so there are bound to be negative consequences from interfering from on high. Markets are bottom-up, not top-down, and what’s called ‘spontaneous order’ occurs when individuals make their own decisions through local incentives, benefitting the whole as they do so. Politicians do not have the necessary information to make decisions better than the individual agents in the market, so they are bound to do a less good job than leaving it the agents in question. There are few better pieces of wisdom in economics than that one, and we ignore it at our peril.


Saturday, 25 May 2019

The Internet Is Making Us Smarter & More Divided

Suppose it were possible to aggregate all the different types of human intelligence and knowledge together, and take an average level of the population. I wonder, is social media making us, on average, a smarter nation or is it having a diminishing effect?
No doubt it is enhancing many people, and making others far more susceptible to nonsense - which is why I ask about average smartness. I am not totally sure that the Internet is making us smarter, but I am fairly sure it is - and I can posit a few considerations that may make this clearer by looking at what the Internet is doing:

(Disclaimer: Bear in mind below, when I use words like 'intelligent' and 'foolish' I have factored in that these things are a bit of a mixed bag inside many minds)

1) The Internet in many ways makes intelligent, knowledgeable people more intelligent and more knowledgeable, by giving them greater access to other people's knowledge and intelligence.

2) The Internet in many ways makes foolish people more intelligent and more knowledgeable, by giving them greater access to other people's knowledge and intelligence.

3) The Internet in many ways reinforces foolish people's views and beliefs, by giving them greater access to other foolish people's poor reasoning and bad ideas with which they already agree.

4) The Internet in many ways introduces additional foolish views and beliefs to already foolish people, by giving them people greater access to other foolish people's poor reasoning and bad ideas.

Numbers 1 and 2 are having a positive effect on humans' average smartness, whereas numbers 3 and 4 are having a negative effect on humans' average smartness. So which has more weight - the positive or the negative?

People genuinely looking for facts and truths now have better access to what more and more people believe and have greater access to what different people believe from both sides of the debate. We can find facts and arguments quicker, which increases the amount of things we can find out

Visual processing and syntax absorption is greater, and experts are far more accessible than ever before. Once upon a time, if you wanted to digest expert knowledge, you had to buy their books or attend their lectures. Nowadays, thousands of professionals in their fields offer daily insights for free, on blogs, in videos, or in printed essays. You can even read books for free in PDF form.

Given the foregoing, I think it is difficult to deny that the Internet is making us smarter on average. But one other thing may be true: the Internet appears to produce more hostility and insults than face to face social interactions - so it is probably widening the gulf between both sides, and leaving many people more averse to their opponents than before the conversations started.

On a slightly different but not wholly unrelated topic, after the recent cancellation of the hideous The Jeremy Kyle Show, following the death of a guest, a lot of people have been saying that vacuous programmes like Jeremy Kyle's show - along with shows like Made in Chelsea, Towie, Big Brother and other celebrity reality shows, and magazines covering the lifestyles of half-witted pop icons and pin-ups - have increasing popularity because we as a nation must be getting more vacuous too.

I'm not so sure this is true - maybe the opposite is true; maybe the vacuity has become so popular not because we are getting dumber, but actually because, as a weighted average of the nation, we are all getting smarter, more knowledgeable and more academically gifted. If you think about consumable products in terms of the usual economic course - an increase of something (oil, gas, timber) causes its price to go down not up, and this may apply to vacuity too - it is commanding a higher price because it is in shorter supply than ever before, especially as it's now more accessible than ever before. A quick feel of the nation's pulse doesn't lead me to intuitively believe this is true - but it just might be.





Wednesday, 22 May 2019

The BBC's Climate Change Programme - Some Facts, But Mostly Fiction

At the weekend I watched the BBC’s Climate Change: The Facts, narrated by the usually laudable David Attenborough. Alas, it gave us a very ‘biased’ version of the facts - so much so that I don’t recall ever seeing a BBC programme with quite so much of an obvious agenda for manipulation as this one. It was short-sighted, unbalanced, alarmism of the worst kind - which will no doubt bypass many brains and head straight into their pliable emotions, but a more careful assessment of the programme would soon expose it for what it is - state-sponsored propaganda.

I would to offer a more balanced, and hopefully more interesting analysis of the situation. Thanks to the ideas of economist Arthur Cecil Pigou, we are probably already doing about as much as we can to mitigate the negative effects of climate change. Here's why. Pigou noted that market activity can impose negative externalities on other citizens (such as pollution through carbon emissions), so it might be a good idea to tax pollution at a rate commensurate with the costs they impose. If your factory causes £500 worth of pollution, you pay £500 worth of tax. But this is insufficient by itself, because another economist, Ronald Coase, gave insight into how Pigouvian taxes can backfire. Pigouvian taxes do lead to fewer carbon emissions, but with fewer carbon emissions, energy prices rise, resources are misallocated, innovation is impeded, including innovation that helps us solve climate problems, which then goes on to hinder the solutions the greens are seeking.

Several of the commentators in the BBC programme said that because climate change is an emergency, we should be risk-averse, and risk-aversion here means spending more money and resources on tackling climate change in the here and now. But this is faulty reasoning, because risk-aversion should primarily focus on the world’s biggest risks - and the biggest risk of all is not that future (richer) generations will be born into a warmer climate, it is that present (poorer) people are going to be born in a poverty-stricken state where they can’t afford access to cheap, necessary, dependable energy. The way to be rationally risk-averse is to help poorer people become more prosperous - not adopt short-sighted climate change policies that make energy unaffordable for those that need it most.

Rising tides sinking some boats?
Let’s now focus on the main message of the programme - that even small increases in temperature in the next 100 years are going to be disastrous for people living in coastal regions (and there are at least 650 million of them, according to narrator David Attenborough). Alas, this prophecy of doom is a presumption they never attempt to justify. As I discussed much more extensively in my 4 part climate change series (see the sidebar on the right) - whatever science tells us about the changing climate, the future is far too complex for anyone to know the magnitude of the effect of those changes, how future humans will be equipped to deal with them, and who will be better and worse off. Anyone who tells you otherwise is either mistaken or lying (or perhaps a bit of both).

Suppose the world gets a little warmer in the next 100 years, as predicted. Through today’s lens of analysis, it’s expected to have a net negative effect on places like Ethiopia, Uganda, Bangladesh and Ecuador. But no one talks about the net positive effect it could have in regions of Russia, Mongolia, Norway and Canada, where inhabitants are subjected to harsh winters. But even that’s too simplistic, because you then have the unenviable task of considering what future Norway or future Bangladesh will be like compared to now, and undertake a separate measurement of forecasted temperature increase alongside perceived impact at any given time.

Not only is that complex, it’s almost certain to be short-sighted and hasty. China in 1965 would be very poorly-equipped to deal with a metre of rising tide compared with the China of now or future China, who could pay for it with loose change. This is all obvious stuff if you’re objective with no personal agenda. Just as in every decade that has passed recently, global warming has produced both negative externalities and positive externalities, and future global temperatures are too hard to predict in terms of whether or not longer growing seasons and milder winters produce a net cost on the world.

All that said, let’s be generous to the BBC commentators and declare that their spectre is wholly accurate (against what my own reasoning says) - that increases in temperature in the next 100 years are going to be disastrous for people living in coastal regions. What might they have forgotten? Currently we live in a world in which about 71% of our world’s surface area is ocean, where it could rise by half a percent if the ice caps melt very much in the next few decades. Humans have done pretty well in the past few hundred years adapting their industry in a world in which 71% of our world is ocean - why is it so hard to believe that people in the future with more money, greater knowledge and better technology will find it so hard to adapt to a world in which 71.5% of the world’s surface is ocean?

Not convinced? Ok, let’s take a worst case scenario - that all of the 650 million people living in coastal regions are going to be affected by rising sea levels in the next hundred years. A few key facts: firstly, almost all of those 650 million people won’t be alive in 100 years, and during that time they and future descendants will have had the capacity to move inland in response to the very gradual increase in sea levels. 100 years is a long time to make adjustments, especially in a future in which everyone is richer than now and more technologically astute.

The world is going to change so much in the next 100 years that you’re not going to believe the progress. To give you an idea, think about how much it has changed from 1850 to 1950, then from 1950 to 1980, then from 1980 to the present day - technological increase follows an approximate increasing exponential curve - which is roughly y= 2^x (i.e. y equals 2 to the power of x - which is to say that every time x goes up by 1, unit y doubles). In the next few decades the world will be so different that its progress will shock you beyond belief - and there is every reason to be optimistic about our ability to adapt to climate change, especially given how jolly clever and innovative we humans are when we all work together to solve problems (if you need elaboration, read some of my 45 articles on 'Human Progression' also located on the side bar to the right).

Some people struggle with this line of reasoning - probably because its truths are counter-intuitive - but it goes something like this: we are not sure how many of the 650 million people (and more, factoring in population increase and migration to cities) will be affected by rising sea levels, but here's what we do know. If moving inland would be costly, not moving inland will be a lot more costly. It's one thing to discuss the costs of moving inland and weigh up that against all the benefits and the future capabilities of dealing such things - but it's quite another thing to warn about staying in coastal areas and getting washed away, because that's just not going to happen.

If rising oceans and moving inland are the price that future unborns have to pay for living in such a prosperous world (and it's still a big IF) then it is certain that those future unborns will pay those costs, and almost certainly a lot more easily than we can pay them. If rising oceans and moving inland are not the price that future unborns have to pay, either because we are burning almost no fossil fuels in the future (which is highly likely to be the case) or because climate alarmists have got their predictions wrong, or because future humans have technology that easily helps them adapt to the gradual changes (which is almost certainly going to be the case), then the alarmism has been largely unnecessary, because the combination of global market innovation and Pigouvian taxes is already doing about as much as it can..

Greens are also telling us in this ‘climate emergency’ that we need to commit to net-zero carbon emissions by 2050. Such a commitment, they vow, would “drive innovation, grow jobs, build prosperity and secure a better world.” Nice idea, but alas, it’s rare to read so much nonsense packed into one sentence. Fossil fuels are the substratum of a thriving economy and the world’s biggest progression-explosion that humanity has ever seen. Markets drive innovation, providing billions of people with affordable energy and improved standards of living that our forebears wouldn’t have had the first clue how to obtain. Weaning our way off fossil fuels is a noble goal when it can be replaced with something more efficient, but the greens are getting it backwards - it is more market freedom and competition that will advance this innovation the quickest, not their absurd ideas.

Some might say, alright fair point, but we can at least try to sort out some of the obvious damage to the planet that climate change is causing. To which I say, ok, demonstrate this ‘obvious damage’ is net damage when traded off against the progression-explosion and how it lifts masses of people out of poverty, and then show your work (see my four point challenge that no one to my knowledge have ever answered satisfactorily):

1) Give us a proper, comprehensive cost-benefit analysis of the present relationship between industrialised human progress and its effects on the environment, showing why the resultant analysis yields a net cost against the industrialised human progress in favour of a radical interventionist alternative.

2) Given the efficacy of number 1, propose a practical, realistic method of implementation of a series of mitigating actions within the current technological capacities, stating timescales, expected empirical results, and why this series of actions won't knock on to have a net detrimental effect on the positive elements of human progress we are trying to sustain.

3) Given the combined efficacy of 1 and 2, present an empirically demonstrable, fully costed plan of action, explaining how this allocates the required resources more efficiently than the market, and how the leading two dozen world economies can best come together to achieve this without it having a net negative economic impact on their citizens.

4) Given the combined efficacy of 1, 2 and 3, justify why all these impediments to market growth won't have a net detrimental effect on the developing world - on the planet's poorest billion people, who most urgently need a global, industrial market in which to participate, to help them climb the ladder of prosperity.

And that is the most important part of the story - it's that climate change alarmists really do not have a single, credible solution to the problems they think need solving. It's fatuous to declare a climate emergency and pay no regard to whether there are actually any problems that need solving, and if so, how to solve them - they have no clue, and no clue about how to have a clue. If they did, they'd be delighted to produce a detailed analysis based on those 4 assessments - yet no one ever does.
Being unable to answer these questions, and always failing to even understand the importance of them, why, then, do environmentalists fail to apply the proper humility to the proceedings and take ownership of their own failings? I think the main reason is that they always appear to be confused by a base rate fallacy regarding what they are doing. Even if we ignore the fact that this level of uncertainty is not an obvious call to action (and we shouldn’t ignore that, but we will for simplicity’s sake), and the fact that these guys have no real clue of the appropriate measure of range of possible outcomes against range of possible actions, they are utterly confused by the concept of ‘doing’. They peddle the narrative along the lines of ‘What we should be doing’ when really they mean ‘What we should be doing now’. But doing things now for projected future scenarios is hasty and presumptuous because time is inevitably going to reduce the cost of dealing with the problem (because we’ll be richer, and with better technology, and have more information and understanding).

The fact that uncertainty will decrease over time, and our knowledge, resources and richness will increase over time is an argument that, relative to our abilities, the problem will get smaller not larger, and our ability to manage it will get better not worse. If you don’t believe me, and still think we need immediate action otherwise it’ll be too late, you only need remember that this has been said for every decade for at least the past five, and with every passing decade we have gained in understanding, reduced our uncertainty, made humanity better off, reduced poverty, increased global trade and prosperity, become greener, and enhanced our technology, and this in spite of the greens not because of them. And on that point, I'll leave you with something I once said in this ASI article:

"I don't have much of a problem with most green taxes - taxing extra on car emissions because it incentivises people to care about cleaner air by caring more about their car tax bill does, in effect, resemble the market. Alas, there are lots of people who think it is only politicians who can engender this change to make us greener. I think this assumption needs correcting.

Although Pigouvian taxes bring in revenue for politicians short-term (for a few decades maybe), the long-term indicators are that the market left to run by itself will naturally make us greener anyway. The reason being: businesses are already looking for the most efficient means of supplying customers using as little energy as possible, because in a highly competitive market it is in their interest to do so to remain profitable. The goal to reduce energy output can, and has, come in various ways: replacement of human energy for machines, replacement of metal-based technology for higher intensity resources or carbon-cased materials, replacement of paper for digital devices, and so forth - and these are improvements in production that naturally improve business's cost-effectiveness.

Consequently, compared with how the market engenders continually increased efficiency, emission taxes probably will turn out to have had only a much more negligible effect on lower energy output and more efficient use of resources than the free market, because the market is driven by efficiency far more than politicians with political interest. If there is a race to make us greener, politicians are more like the tortoise and the market is more like the hare."
* Photo courtesy of the BBC

Wednesday, 15 May 2019

Let's Face It, Islamophobia Isn't Very Much Like Racism At All

The government hasn’t got much right, especially recently - but it is right to reject a very plastic definition of Islamophobia published in December by a cross-party group of MPs from Labour, the Liberal Democrats and the Scottish Conservatives:

“Islamophobia is rooted in racism and is a type of racism that targets expressions of Muslimness or perceived Muslimness.”

Most broadly, this is wrong - in most cases Islamophobia is nothing like racism, because racism is an unfair prejudice based on skin colour and ethnicity - both of which are not choices made by the individual - whereas Islam is a chosen belief system, and prejudice against it ranges from a philosophical viewpoint that thinks it is a foolish, dangerous set of ideas (which it certainly is in many places) to hating Muslims and treating them appallingly through a form of dehumanised aggression and intolerance.

In this article we find the pretext for justifying why Islamophobia is supposedly rooted in racism:

“So we argue that “Islamophobia is rooted in racism and is a type of racism that targets expressions of Muslimness or perceived Muslimness”. We’ve produce a series of examples, modelled on the IHRA definition of antisemitism, to help people understand how this manifests: the attempted murder of a Muslim woman and her 12-year-old daughter as “revenge” for the Parsons Green terror attack; the torture of a Muslim convert by two women in Guisborough, while they shouted “We don’t like Muslims over here”; the Muslim mother attacked for wearing a hijab on the way to collect her children from primary school in London; the “punish a Muslim day” letters sent to Muslim institutions, and prominent Muslim figures; the racists in Northern Ireland who left a pig’s head on the door of the mosque they had graffitied; the motorists forking out £1,000 more to insure their car if their name is Muhammad; the Social Mobility Commission’s findings of conscious and unconscious bias against Muslims in the employment market; the Islamophobic abuse hurled at people who aren’t even Muslim, because their abusers couldn’t tell the difference between, for example, a Sikh wearing a turban and a Muslim man; the men who tied bacon to the door handles of a mosque in Bristol.”

Some of them are a bit like racism; some of them are nothing like racism at all. The attempted murder of a Muslim woman and her 12-year-old daughter as “revenge” for the Parsons Green terror attack sounds quite a bit like the kind of dehumanised aggression and intolerance that one might believe to resemble racism; but motorists forking out £1,000 more to insure their car if their name is Muhammad sounds much more likely to be based on actuarial data concerning geography, postcodes and statistical likelihood of making insurance claims.

Islam isn't a race, and therefore definitionally Islamophobia is a much broader concept than racism, even if some Islamophobes are also racist. A lot of racist people probably don't like Islam - but that doesn't make racism equivalent to Islamophobia.

In 2015, I was highly critical of the then Labour leader Ed Miliband's squalid attempt to win Muslim votes in his election campaign, by promising to outlaw Islamophobia:

"We are going to make Islamophobia an aggravated crime. We are going to make sure it is marked on people's records with the police to make sure they root out Islamophobia as a hate crime."

I explained why absolutely everything is wrong with this idea, with four principal reasons that still hold true today:

1) It's a dystopian example of thought crime; the very epitome of an Orwellian nightmare. Phobia literally means a fear of something. If you have claustrophobia you are afraid of confined spaces. If you have arachnophobia you have a fear of spiders. If you have a fear of Islam you have a fear of its growing socio-political influence in society, and of the way people anxiously pander to it, and of the extent to which its extremities stultify minds, and of the spectre of increased radicalisation that leads to hate speech and sometimes murder and terrorism (all very understandable fears, I'm sure we'd all agree). Of course we should be wholly tolerant and kind towards moderate Muslims, but far from wanting to criminalise this anti-extremist phobia, we should actively encourage it, and come down even harder on those Muslim leaders radicalising young people.

2) It's a contemptible infringement of our civil liberties and our freedom of speech. To outlaw the ability to criticise, mock, ridicule, campaign against and intellectually challenge Islam is to rob us of vital tools for enquiry and progression, and will at the same time create an even greater culture of trepidation whereby people are forever afraid to speak openly for fear of being criminalised.

3) It's ambiguous to the point of being useless. How the heck is this ridiculous legislation even going to be properly enforced anyway? The boundary line between what constitutes the Miliband version of Islamophobia is blurry. Am I an Islamophobe if I write a blog saying that I don't think the Qur'an is anything other than an inept man-made creation? Will I be outside the orbit of the Islamophobia law if I demonstrate outside a Mosque known to be radicalising young Muslims, or if I tell the police about a Muslim grooming gang operating above a local kebab shop (that's hypothetical by the way - I know of no such place in my city)? In terms of the law, Islamophobia is so ambiguous it is nigh-on impossible that it could be enforced with any consistency or in a way that doesn't stifle our free expression and genuine concerns about the darker elements of Islam. This leads me nicely onto point 4 - perhaps the most frightening prospect of them all.

4) It empowers the very people we actually want to disempower. Even aside from the very serious problem of making people reluctant to speak out against radical Islamist preaching in mosques, extremism in schools and hate speech in public places, the law will only help the despicable child-sex gangs that groom, entrap, rape and exploit young British girls. The majority of these offenders are Muslims of Pakistani origin (recall infamous cases in Doncaster, Rotherham, Manchester, Blackpool, Oldham, Derby, Newcastle, Rochdale, Bradford and Oxford as horrible cases in point). The reason so many of these young girls were subjected to the perverted exploits of the organised Muslim gangs for so long is because numerous agencies and authorities (including the police) were cravenly fearful of being labelled racist or prejudiced if they enforced the law against these perpetrators.

The truth is, any proposed law against criticism of Islam is going to be highly irresponsible and gravely hazardous, as it comes with the danger of creating a greater freedom for already dangerous Muslims and potentially dangerous Muslims, and also the danger of creating a culture of trepidation and spinelessness for most other UK citizens.

Thursday, 25 April 2019

The Disturbing Cult Of Greta Thunberg: Questions She Can't Answer (And No One Else Will)

Teenage climate change activist Greta Thunberg has explained how the “gift” of living with Asperger syndrome helps her “see things from outside the box” when it comes to climate change. “It makes me different, and being different is a gift, I would say,” she told journalist Nick Robinson. "I don’t easily fall for lies, I can see through things."

It's optimistic, unfledged self-confidence, but alas it's the opposite of the truth. She is  doing everything she thinks she isn't doing - she is falling for lies, she can't see through them, and she is thinking too narrowly inside the box, not outside, in participating in a mass delusion. She is trying to tackle complex questions she doesn't understand with over-simplistic answers she thinks she does understand. This child-led mass hysteria, and political fawning from the likes of Jeremy Corbyn and Caroline Lucas, is quite a sad thing to see.

The appropriate response to Greta Thunberg's Kumari-like cult following is to give her, or anyone on the side of climate change alarmism, the opportunity to do something they never do, and seemingly never will do - to show there is a problem that needs solving; to show they understand that it can be solved with radical new measures, and to propose viable solutions to solve it.

The fact that they can't do this, and never attempt to, is reason enough not to take them seriously, because if they really did care about this issue as they say they do, and genuinely thought there was an intelligent solution, they'd be happy to shout it from the rooftops. Given the foregoing, in my submission, here is the only way they can show themselves as a credible group to be listened to seriously:

1) Give us a proper, comprehensive cost-benefit analysis of the present relationship between industrialised human progress and its effects on the environment, showing why the resultant analysis yields a net cost against the industrialised human progress in favour of a radical interventionist alternative.

2) Given the efficacy of number 1, propose a practical, realistic method of implementation of a series of mitigating actions within the current technological capacities, stating timescales, expected empirical results, and why this series of actions won't knock on to have a net detrimental effect on the positive elements of human progress we are trying to sustain.

3) Given the combined efficacy of 1 and 2, present an empirically demonstrable, fully costed plan of action, explaining how this allocates the required resources more efficiently than the market, and how the leading two dozen world economies can best come together to achieve this without it having a net negative economic impact on their citizens.

4) Given the combined efficacy of 1, 2 and 3, justify why all these impediments to market growth won't have a net detrimental effect on the developing world - on the planet's poorest billion people, who most urgently need a global, industrial market in which to participate, to help them climb the ladder of prosperity.

No one, child or otherwise, can even begin to call themselves a serious climate change thinker until they've produced a detailed analysis based on those 4 assessments. And that is the challenge that should be presented to all of them, every time they try to propagate their agenda - because they have earned not one jot of credibility until they do. Until they accept this most necessary challenge, they are simply crying out to be treated as a deluded, brainwashed cult of hysteria, with no real handle on the way the world operates, and the underlying complexities to which human endeavour is subjected.  

Monday, 15 April 2019

Wiping Out 60% Of Animal Populations May Not Be A Bad Thing

I read a report that says humanity has wiped out 60% of animal populations since 1970, and that humankind has destroyed 83% of all mammals and half of plants since the dawn of civilisation. Now this immediately sounds like bad news, and it may well be bad news, but it may not be. The information in the article is insufficient to tell us one way or the other.

Perhaps the entirety of human progress and all that created value and happiness has been worth the price of eradicated life forms. I think it probably has been worth it, but perhaps not. One thing is sure though; if you want to defend a particular view, you ought to have a good argument about the pros and cons of human progression, and devise a proficient metric for establishing which has greater precedence. In other words, you mustn’t (as many people do) just read a headline like “humanity has wiped out 60% of animal populations since 1970” and assume it’s a bad thing, because it may not be.

It doesn’t help, of course, that the language they use is set up to make you feel like it’s a bad thing - where terms like ‘wiped out’ connote some kind of allusion to genocide or bacterial eradication. A much more sensible analysis might conclude something like “During the unprecedented explosion of human progression in the past few hundred years, compared with the hundreds of thousands of years of human plight and suffering that preceded it, many species have been unable to co-exist alongside that progression, sometimes due to human activity and sometimes not”. That’s a much better way to phrase it.

This is especially relevant given that palaeontologists estimate that 99% of every species that has ever lived has now become extinct, and that the vast majority of those extinctions occurred long before humanity came on the scene. Most species died out in the natural fight against nature’s oppressive forces - severe weather, biological competition for survival, natural disasters, and so forth - so the narrative that the animal kingdom was a safe, stable place before rotten humans came along to spoil everything is, at best, hugely exaggerated, and at worst, a very unfair reflection.

Here's a novel way you could think about it. You could note that endangering the existence of things for human benefit is a dominant part of our existence. Measles, mumps, rubella, smallpox and polio have been prominent in human history, and thanks to medical advances, their existence has been endangered for the benefit of humanity. We are glad these diseases have been eradicated because they bring about impediments to human progression.

It isn’t, therefore, a huge category leap to say that we could ascribe overall positive benefits to humanity’s progression, even though many species have been unable to co-exist alongside that progression. In other words, if we can be reasonably glad that diseases have been eradicated because their survival brings about impediments to human progression, it’s not self-evident that we shouldn’t be able to put up with other living things being eradicated because their survival brings about impediments to human progression, as long as the benefits outweigh the costs.

To do a proper cost-benefit analysis, you would have to assess how much humans value the gains against the losses of extinct species. An argument can be made that as part of the analysis we must include the cost of life to the species themselves, but that’s hard to measure, and it’s not obvious that the way we may attempt to assess it is in any way meaningful to human minds.

All we can do is have a stab at measuring the costs to humans of other species’ extinction, and even that is difficult. What price would it be worth to humans, for example, to preserve lions on the planet? If every human had to pay out 25% of their annual income as a one-off payment to guarantee the survival of lions, is that too much? It sounds like a lot too much. What about 25% of their annual income to save lions, tigers and elephants? It still sounds like too much. What about 0.01% of our annual income to save all mammals? That doesn't sound like too much at all. What about if the cost of saving lions fell to one individual, and he wasn’t allowed to receive any financial help? Would a one-off fee of £50,000 be worth it to save all lions? Maybe it would for Bill Gates, but wouldn‘t for a minimum wage worker.

The upshot is, there isn’t an easy way to measure whether the sum of human progression has been worth it for the cost of the extinctions of other life forms - but given how much humans value their own lives, it is at least reasonable to consider that it might have been a net benefit to the world to bring about such a huge sum of human happiness. When thousands of tiny creatures die in order for a single house to be built, almost nobody doubts that the value for the inhabitants outweighs the cost to all the living things in the soil. It’s possible that that truth could be equally well extended to the sum of human happiness.

And if you think it’s difficult to measure the value of a human life, you only need to look at how humans behave to see how much we do value it. According to Steven Landsburg’s research on this matter:

“A standard ballpark figure for the value of a life is about ten million dollars. What this means is that empirically, people are willing to pay about $1 to avoid a one-in-ten-million chance of death, about $2 to avoid a one-in-five-million chance of death, about $10 to avoid a one-in-one-million chance of death, and so on for various other small probabilities. (Theory tells us that willingness-to-pay to avoid a probability of death should be some constant times that probability, as long as the probabilities are small. Data tell us that the constant is somewhere around ten million dollars.”

If every life is worth 10 million dollars (by the way, it’s not self-evident under this metric that every life is worth the same in economic value, but let’s assume it is for the sake of argument), and there are 7.5 billion people in the world, then humanity being alive compromises an aggregated value of at least $75,000,000,000,000,000. That is 75 quadrillion dollars!

So while it isn't factually accurate to say that "humankind has destroyed 83% of all mammals and half of plants since the dawn of civilisation" - because it involves many false attributions of causality - perhaps an aggregated value of 75 quadrillion dollars has been worth the price of some species being unable to co-exist alongside us, or perhaps it hasn't: but it's the epitome of lazy thinking to just assume it hasn't and not bother to consider the situation with a proper cost-benefit analysis, as so many do.

Wednesday, 10 April 2019

Eugenics & The Dark History Of The Minimum Wage

Many people believe that the minimum wage is a state policy that helps poor people. Some even think it should be higher than it currently is. People who actually understand the real effects of the minimum wage – a club you’d hope would be larger than it is – know that this is economic foolishness: that the minimum wage actually makes the vast majority of poor people worse off (see my Minimum Wage / Living Wage side bar on this).

Some people know something else on top of that – that, actually, far from being a state policy that helps poor people, the minimum wage was actually sinisterly invented as a eugenics-type method of keeping so-called ‘undesirables' out of the job market (I wrote an article about this for the Adam Smith Institute – re-printed in full below).

When politicians support economically foolish policies, the relevant incompetent or dishonest? question looms large: Do they support foolish policies because they don’t understand they are foolish, or do they know the policies are foolish but support them anyway because they are popular vote-winners? Of course, added to the second option is the reality that in some cases they support a policy because to not support it would be damagingly unpopular.

One clue of the answer to that question might be this. We all know of instances in which politicians understand that artificially raising the cost of something will reduce its consumption, because that's what they try to do with taxes on goods like sugar and alcohol. They seem to understand the basic principle that their actions will reduce consumption of the thing they're taxing, so they probably could work out that artificially raising the cost of employment will reduce employment. To me it indicates that in many cases they probably know the policies are foolish but support them anyway because they are popular vote-winners.

Here is that article I was talking about, talking about the minimum wage's very dark history:

We read today that the national minimum wage will increase by 20p an hour to £6.70 from October, and that this will benefit more than 1.4 million workers. What we hardly ever hear from politicians is how many people will feel the costs of this increase, in addition to the people who are already being hurt by having a minimum wage law in the first place.

The problem with state-enforced minimum wage laws is pretty standard economic text book stuff: the minimum wage makes it harder for low-skilled workers to get a foot on the labour market ladder, it unfairly loads the burden on firms that employ low-wage earners (a burden that could be avoided by simply reducing the tax low-earners pay, or taking them out of tax altogether), and as a result it often causes inflation of prices and reduction in staff as firms try to recoup their losses.

With the announcement today, and with the Budget looming, I was very interested to stumble upon an article this week by Jeffrey Tucker about a Eugenics Plot Behind the Minimum Wage, in which we find out that in the early 20th century some eugenicists tried to introduce the minimum wage as a means of getting some of the lesser able people out of the employment market. Here are some relevant quotes that are bound to shock:

A careful look at its history shows that the minimum wage was originally conceived as part of a eugenics strategy — an attempt to engineer a master race through public policy designed to cleanse the citizenry of undesirables. To that end, the state would have to bring about the isolation, sterilization, and extermination of nonprivileged populations.

It was during this period and for this reason that we saw the first trial runs of the minimum wage in Massachusetts in 1912. The new law pertained only to women and children as a measure to disemploy them and other “social dependents” from the labor force. Even though the measure was small and not well enforced, it did indeed reduce employment among the targeted groups.

Leonard documents an alarming series of academic articles and books appearing between the 1890s and the 1920s that were remarkably explicit about a variety of legislative attempts to squeeze people out of the work force. These articles were not written by marginal figures or radicals but by the leaders of the profession, the authors of the great textbooks, and the opinion leaders who shaped public policy.

“Progressive economists, like their neoclassical critics,” Leonard explains, “believed that binding minimum wages would cause job losses. However, the progressive economists also believed that the job loss induced by minimum wages was a social benefit, as it performed the eugenic service ridding the labor force of the ‘unemployable.’”

So when we hear politicians make minimum wage commitments in the run-up to the election, bear in mind that those that preceded them were always fully aware that wage floors precluded people from the labour market, and that they were once deliberately implemented to expunge the demographic landscape of those they thought inferior citizens that were unworthy of earning a living. That they so readily endorse a policy that places a barrier to employment for so many people tells you just about all you need to know about the extent to which winning votes matters far more than aiding people’s job prospects.

I hope that, in my lifetime, politicians and social commentators begin to get the simple message that if you artificially remove the lower rungs on the labour ladder, you make it difficult (often impossible) for people to climb it, or in some cases, get on it at all.