The Economics Of Terrorism, And Why Islamic State Will Eventually Crumble

A recent poll revealed that just over 70% of people in the UK think that immigration increases the likelihood of terrorism. They are right, but not in any way that should cast aspersions over the merits of immigration, because immigration increases the likelihood of terrorism only in the same way that having roads increases the likelihood of speeding. The cause of an increased likelihood of terrorism is down to something else.

Terrorism, like fruit, vegetables, cars and holidays has a supply and demand curve. Consider terrorism as a good with a demand curve - by which I mean that terrorism is an activity that currently some people wish to engage in to achieve a religious or political goal. The price of engaging in terrorism is paid in the form of the risk of death, injury or imprisonment.

Similarly, there is a demand curve for burglary, speeding, and fraud, and the price paid to do these things comes in the cost of a fine or a prison sentence. To put it in formal terms, we could in theory draw a demand curve for all of these crimes and then plot the likelihood of punishment on the vertical axis, and the number of crimes committed for each on the horizontal axis.

Ascertaining the steepness of the demand curve is like asking whether an increase in the probability of punishment will amount to reduced instances in crimes committed. Measuring the slope of the demand curve for, say, burglary is equivalent to measuring the deterrent effect of the punishment for burglary. Crimes like burglary, which are often committed to feed a drug habit, are likely to have steep demand curves because drug demand is usually fairly inelastic for an addict, which is why recidivism rates for drug addicts are so high. With speeding, on the other hand, the demand curve seems to be pretty flat. In other words, the single appearance of a speeding sign or a camera leads to a huge decrease in the incidences of speeding.

Now when it comes to terrorism and the sort of people who are likely to commit terrorist acts in the name of ISIS, the demand curve is about as far from flat as it is possible to be, because most of the causes with which the terrorists identify are causes bigger than the crime deterrents (including even death). In other words, many terrorists are perfectly willing to die for their cause, believing that in doing so they are offering a noble service to Allah, meaning in most cases there is no deterrent to flatten down the demand curve for terrorism.

If terrorists have no care for the consequences in terms of punishment for the crime, and if Islamic State continues with the same momentum in recruiting willing participants to fight for their cause, then terrorism is going to continue to be a problem, and immigration only changes where the incidences of terrorism take place - be it Britain, France, Germany, Holland or Belgium.

Regarding the aims of Islamic terrorism, and the fact that those aims even seem able to subvert the moral compass of the perpetrators, I see no signs of incidences of terrorism decreasing. The wide scope of this evil regime is that Islamic State leader Abu Bakr al-Baghdadi wants to establish the Caliphate of all Caliphates, unleashing terror everywhere he can, and ruling Islamic State nations under the thrall of their terror-inducing domination.

There is, though, perhaps one fly in the ointment - if only he was a bit more familiar with the works of Plato and Aristotle, or even a bit more cognisant of historical antecedents, he and his fellow Jihadi thugs would see that their aspirations are probably unrealistic in the longer run.

Here's why. A general pattern throughout the history of military or political coups is that even when they are brutal and catastrophic for the citizens, they soon reach a point of relative stability, not least because it's nigh-on impossible to rule a country under continual internal strife. In other words, good conquerors, even Caliphs, totalitarian as they were, still allowed at least a semblance of autonomy and harassment-free administration of people. That's why, even though it is likely that these horrible terrorist incidents will continue to occur, and Islamic thuggery will continue to pop up, the idea of ruling nations consistent with the backward, brutalised, oppressive, freedom denying methods of Islamic State is wholly unrealistic in the long run.

Could A Basic Income Work?

Recently Tim Harford, in an article in the Financial Times, talked about the idea of a 'basic income' - a much vaunted idea in some circles and a much deprecated idea in others. It's not even an idea that's more popularly left or right - figures as far to the right as Friedrich Hayek and Milton Friedman, and groups as far to the left as the Green Party have both come out in support of it, although as you'd expect they differ on the nuts and bolts of the mechanism.

But can it work? Obviously, as most people would concur, it's ridiculous and absurd to offer a basic income universally, because lots of middle and high earners don't need it. However, a basic income given to people who have no work-based earnings or low earnings from work would be okay, as long as it tapers out according to a certain threshold of earnings, but in a way that doesn't disincentivise work either.

Whether there is a basic income system that could get the balance right between managing the varying and complex needs of a whole range of people and not being too expensive and bureaucratic, I'm not sure. I'm even less sure about whether our politicians are intelligent enough to devise such a system.  

If such a thing were to work then off the top of my head I could envision it being along these lines. The government could set a basic income of x per year by using a cut-off point of y per year, and a withdrawal rate of 50%. That means that a basic supplement to a person's income would be equal to 50% of the difference between annual income and the y cut-off point. So a person out of work would get the basic income of x, and a person who earned an amount lower than y would get a supplementary income, and this keeps narrowing as earnings increase up until y.

So, picking a figure for simplicity's sake (a proper study would need to be done by people with all the facts to hand to find the optimal figure), if y = £17,000, and the basic income is £8,000, someone earning nothing gets a basic income of £8,000, someone earning £11,000 per year gets a £3,000 supplement (half the difference between his or her earnings and y), and someone on £15,000 per year gets a £1,500 supplement, and so on, and then when y is reached (£17,000) there is no supplementary income, and y is the point at which every pound earned thereafter is taxed. There are still serious issues about how any basic income would be paid for - because simply raising taxes to cover the costs only adds to some of the problems the government would be looking to solve.

Whether it's with a basic income, or other kinds of change, something needs to be done to revise our welfare system - it is anachronistic and has evolved far beyond the original scope of its intention, in a country that's very different from the one at the time of its inception in the late 1940s. The method of tackling a diverse range of welfare needs in a one-size-fits-all fashion is now entirely unworkable, as is the perverse conflict between whether a claimant is better off working or on benefits. Basic income or no basic income, the UK has for a long while now needed a new Beveridge Report for the 21st century.

Can You Think Of A Victimless, Rational, Morally Good Crime?

After reading the recent news bulletin about how in Italy it may now be legal in the eyes of the courts to steal food if you're poor and hungry, I was reminded of a debate I had a few years ago. On a cafe forum for debating I once posed the following question; Can anyone think of a victimless crime, where 'victimless crime' means a crime committed whereby in the general sense there is realistically no possibility of anyone other than the agent in question being a victim or coming to harm?

Just to be clear; you can’t say something like “I could make a call on my mobile phone whilst driving (which is illegal), and then hang up with no one harmed” – because although in the specific instance no one was harmed, in the general sense someone could easily be harmed (if you lost control and had a crash).

Despite lots of evidently faulty suggestions (see below), one that came close was “smoking weed on your own in your own house”. I felt compelled to add the caveat; if you are growing the drugs yourself, then fine, that's a candidate for a victimless crime. But if you are buying the drugs from a drug dealer, then there are costs (you are aiding someone else in committing a crime).

But even the growing of the drugs yourself and smoking them on your own still does not really qualify for there being "realistically no possibility of anyone other than the agent in question being a victim or coming to harm", because if the effects of weed smoking in excess are true, then eventually for some people there will be negative externalities - if, for example, you end up imposing an excessive burden on the health service, or addicted to harder drugs, or becoming dangerously paranoid and volatile. If any or all of those things happen then others will feel the effects of your drug-taking. Here are some of the other suggestions I got (with my comments included):

1) Downloading music or films from pirate internet sites

My Comment: No, the victims are the artists/companies that are losing money through loss of revenue. Of course, there's no guarantee that they always incur a loss, if, for example, sales increase due to dissemination of information - but some will.

2) Jaywalking

My Comment: No, this has every potential to cause harm to others. One car swerves to avoid the jaywalker, hits another, and *biff*.

3) Suicide

My Comment: What a bizarre choice, as this manifestly doesn’t qualify. Suicide destroys entire families left behind.

4) Speeding on an empty highway

My Comment: I think that's stretching it a bit, and I don't think I can allow it, because the crime is 'speeding', which won't generally qualify as "a crime committed whereby in the general sense there is *realistically no possibility* of anyone other than the agent in question being a victim or coming to harm". Moreover, I don't think we can grant omniscience to a driver and give him or her any kind of certainty that the highway is empty.

5) Bigamy

My Comment: Again, no, bigamy potentially imposes costs on one of the wives, and one other prospective husband.

6) Polygamy

My Comment: No, polygamy imposes costs on other men and other women. Some people asked the question; what if all people involved in bigamy or polygamy are aware of the costs and the arrangement is entirely mutual between all parties? Even then it is not enough because the cost is still incurred on those whose chances of finding a partner are minimised by the practice. Technically that is true of marriage as well - when John marries the girl you love he imposes a cost on you because your sweetheart is no longer free to marry you. But in marriage the social benefits outweigh the social costs, which is why we don't opt for a world full of unmarried people, which would then reverse the cost-benefit situation.

7) Walking nude in the street

My Comment: No, that's not an argument with much economic utility - a practice becomes prudent if the social benefits outweigh the social costs. Evidently, the costs of allowing public nudity far outweigh the benefits as it imposes costs on anyone that doesn't want to see nude people walking around the streets.

As you can see, it proved very difficult to find a suggestion for a crime committed whereby in the general sense there is realistically no possibility of anyone other than the agent in question being a victim or coming to harm. 

The only good one was, ironically, related to marriage. One contributor proposed the following; “A victimless crime is finding a way to gain the legal benefits of being married to a person of the same sex in a place where same sex marriages are illegal”. That's a good one; there I can see no reasonable grounds to call anyone else a victim. Cleary, as well, I think it is also ironic that the one valid suggestion put forward is one that most pressingly involves the need for a law change. This shows that laws are predominantly about protecting potential victims as well as potential felons.

(Note: If you have any other suggestions to proffer, you're quite welcome to email me)

Now we’ve considered that, I want to consider three corollary questions in terms of economic analysis; one, concerning a crime with an unaware victim; two, concerning whether there is such a thing as a rational crime; and three, whether there such a thing as a morally good crime. 

What about a crime situation whereby the victim has no awareness that a crime has taken place?

Suppose Frank sees that Jack has a wallet full of money. Feeling confident that Jack won't notice a missing £40, Frank steals it while Jack is asleep, spends £39 on junk food, and then bets the last £1 on a 40/1 winning horse, enabling him to surreptitiously return Jack's £40 before he wakes up. Being completely unaware of any crime, it could be argued that it's hard to call Jack a victim of crime. In fact, suppose that with the last £1 Frank bets on a 60/1 winning horse and returns all the money to Jack's wallet while he sleeps. Here we have a crime in which both Frank and Jack have benefitted (Frank with free food and Jack with an extra £20). Yet even then I wouldn't feel happy with the events that took place because theft is theft. That's a good example of a situation in which everyone benefits yet still there are things of which we disapprove.

Or suppose an admin clerk in a large Pension fund organisation with 1 million clients hacks into the computer system and takes one penny from each account, and then donates the £10,000 to charity - is that a victimless crime, or is it a crime with one million victims that did not notice they'd been the victims of an astronomically small theft? Technically I suppose the latter is true - and either way, it still doesn't make stealing right, even if the net gains surely exceeded the net costs.

Is there such a thing as rational crime? 

From an economic perspective, yes. A man who illegally parks on a single yellow line might find benefits of the crime over the year outweigh the annual costs. Suppose Bob works 250 days per year, and the only car-park within walking distance charges £4 per day - that's £1000 per year. If the road on which Bob parks illegally only generates a £30 parking fine every 4 weeks due to a feckless traffic warden, then it could be argued that Bob is committing a rational crime, as his total fine expenditure throughout the year amounts to £390 (13 x 4 weeks x £30) leaving him £610 ahead against the annual car-parking expenditure of £1000. That’s not to say that we should endorse a crime even if it is rational, but it is rational by any standard definition in economics (see Gary Becker’s Rational Choice Theory* for more on this).  

Is there such a thing as a morally good crime?

It depends on your perspective, but at an individual ‘singular’ level, quite possibly. If you, like many of us, place a higher premium on helping the people most in need in the world (people desperate for drinking water and food) over the people with not such urgent needs (like having smoother tarmac on the road, or searching for alien life) then it could be argued that any singular crime that involved you withholding income tax money from the government and giving it to much more desperate people in Africa is actually a morally good crime. I say ‘singular crime’ because clearly if everyone in the country tried this then many of the nation’s vital services would be severely impaired. 

But the man who is fed up with the government's profligacy in relation to injudicious foreign policies, expenses scandals and excessive wage bill, and decides that he will take it upon himself to give the money directly to those for whom it will do the most good, must in some way be more mindful than most.  Here is a situation in which the law is being put up against a man's conscience, with the conscience coming out victorious.  Although we may be right to disapprove, it should be said that in terms of net good, the man's act is positive and has improved the well-being of the planet overall. 

As you may have noticed, the underlying commonality that runs through the above considerations is that irrespective of whether there is a victim (or victims) in those scenarios the agent committing any bad acts or having bad intentions is the one that bears the costs of the outrage on his or her conscience.

Which leads us full circle back to the person who steals food legally because he (or she) is poor and hungry. Intrinsically the theft may well be rational - at least in that it is rational to steal food and risk punishment rather than risk starvation. But where there is not even any punishment, there is a great incentive for many to steal who are not all that poor in the hope that they can get away with it on grounds that they are poor. In other words, what the lifting of this law does is create an incentive of increased theft, which passes the main bulk of the costs/risks onto shopkeepers, and will therefore probably have more negative unintended consequences than is ideally desired.

* Gary Becker's famous rational crime theory involved weighing up the costs and benefits of crime, and trying to ascertain whether some instances of criminal behaviour are rational. For example, Becker considered whether parking in an illegal but convenient spot was a rational thing to do once the probability of getting caught is measured against the benefits of a convenient parking spot. Becker famously spoke of goals in the sense of our being rational actors engaged in a diligent cost-benefit analysis of whether crime pays. Some criminal activities involve reasonable goals if the benefit from the act is perceived to be greater than the probability adjusted weight of being caught and paying a penalty. Developing this David Friedman has argued that "The amount of the punishment should equal the damage done by the crime". The point being, that if crimes are committed when the value to the criminal is greater than the societal harm, only efficient crimes will be committed.

Why The Unthinkable Should Happen Even Less Often Than You Think

At the time of writing we are currently half way through the 2016 FA Cup final - which got me thinking: what a tremendous season the Premier League has been, not just for sport, but also for anyone that is interested in probability and enjoys those startlingly rare and unpredictable outcomes in life. Against all odds (5000/1 at the start of the season) Leicester City have done the unthinkable - they have won the Premier League, finishing ahead of much bigger teams like Man City, Arsenal, Man Utd, Tottenham, Liverpool, and last season's champions Chelsea - all teams with much more money than Leicester and for the most part better players (consider how many Leicester players would get in those teams, and it won't be many).

We mustn't underestimate just how startling this is - it's not just the most shocking upset that's ever happened in the history of football, it's one of the most 'against the odds' things that has ever happened in British history full stop. What compounds the shock factor is that while you expect upsets in cup competitions, the league consists of 38 games where the best team that season has the best chance of being champions.

Perhaps there is another reason, though, why an upset of this magnitude was eventually likely to happen. It's noteworthy to me that there is a marked difference between team sports (like Football and Rugby) and individual sports (like Tennis and Snooker) in terms of how often the superior participants beat the inferior. In team sports the better teams manage to lose against the worse teams much more frequently than in individual sports, where the better players tend to win far more often.

I think I can work out why this is the case; it's almost certainly to do with probability and ratios in relation to consistency. Given that a team's performance depends on multiple players, teamwork, group cohesion, communication, and so forth, it is understandable that their rates of consistency are slightly less reliable than individual performers.

But in sports with individual participants there is another thing that increases the probability of the best player winning most often, it's to do with numbers, and a little thing called binomial distribution. Consider normal distributions in coin tossing - with a fair coin you expect to win about half the time. In a first to ten competition a fair coin would confer no advantage on either player. But suppose the coin was biased to represent superior ability in an individual sport, let's say tennis. Say you have a 1 in 4 chance of winning a coin toss with a biased coin, what chance would you have of beating your opponent in a first to ten competition? Using combinatorial methods that I won't bore you with, I calculate that your chance of wining a first to ten is less than 1%.

Obviously a competition involving a coin that gives you only a 1 in 4 chance of winning a single toss is going to be a harder competition for you to win the more coin tosses involved. That is, you've got less chance of winning a first to 25 than you have a first to 10. Your best chance of winning would be if the competition was a single coin flip - then you have a 1 in 4 chance. Any increase in coin tosses decreases your chances of winning. In a first to 2 your chances are 1 in 16 (25% x 25%), and in a first to 3 your chances are 1 in 64 (25% x 25% x 25%), and so on.

While sport is not quite the same as coin tossing, the same kinds of principles apply. If you as an amateur were told you had to beat a tennis player, or snooker player, or pool player hugely superior to you in ability, your best chance of beating them would be in a one game competition. The greater the increase in number of games you need to win (first to 3, first 5, etc) the less chance you have of winning, because, fairly obviously, there is more opportunity for the superior player's superior skills to affect the outcome.

What all this shows is that once the numbers are stacked against you (as they are when you play someone at sport who is better than you), those numbers get even more stacked against as the game goes on. For example, let me ask a question and see what your intuition says. Suppose you have a big tennis match against Andy Murray, with a £1 million stake, and suppose you take a magic pill that that makes you good enough to win 40% of the points (in Tennis every game is essentially a first to 4 - that is, 15,30,40, game). What are the chances that you'll win the match (best of 5 sets)  against Murray? 40%? No, way out. 20%?, Nope, still way off. 10%? No. 5%? Still not that close.

Your chance of beating Murray is actually just slightly less than 0.0005% (that's 1/20 of 1%). Think about it, if you are able to win 40% of the points against Murray you would win a game just 26% of the time (that factors in the times you'd need to win the game by 2 clear points). To win a set you'd need to win 6 games, which reduces your chances to just under 5%. As you have to win 3 sets to win the match that's why you have only about a one twentieth of 1% chance of beating Murray in a match.

Given the foregoing, and that such narrow probabilities should, on paper, apply to a team like Leicester City too, it is all the more remarkable that they went on to win the Premier League. Enjoy it while it last though, for I doubt anything this remarkable will happen again for a very long time.

Hypocrisy Or Not Hypocrisy? That Is The Question!

 

So I guess many of you have seen this doing the rounds - it's a 13-year-old letter from George Osborne calling tuition fees “a tax on learning” and promising that when the Tories next get in they will scrap them. It was his Nick Clegg moment a few years before Nick Clegg's actual Nick Clegg moment, and many people are now calling the Chancellor a 'hypocrite' on the basis that he is now presiding over tuition fees while in government.

 

Are they right to call him a hypocrite? Perhaps, but perhaps not. The first thing that needs to be said is that quite a few people need to look in the dictionary to find out what the word actually means. Take the filmmaker Michael Moore as a good example.

 

Cast your mind back to 2004. In his all-round pretty disingenuous film Fahrenheit 9/11, Moore thought he would appear clever if he confronted various members of Congress and demanded they enlist their own children to fight in Iraq on the grounds that those who support a war but do not send their sons to fight in it must be hypocrites. George Galloway tried the same thing a few years later in reference to Tony Blair.

 

Both Moore and Galloway were confused about what hypocrisy is. Hypocrisy means publically being for/against x but then privately not-doing/doing x - it's one rule for themselves but another for everyone else. If I say eating meat is morally repugnant, but have a sneaky bacon sandwich on Saturday afternoons I am being hypocritical.

 

A politician that votes to send our armed forces to intervene in a conflict but wouldn't want his son fighting out there is not a hypocrite. Using Michael Moore's logic, a politician is hypocritical if he supports the NHS but doesn't send his son to be a doctor, or if he supports taxi driving but doesn’t get his son to drive a cab. Those situations don't even look a little bit like hypocrisy.

 

Sometimes, though, things do look like a little bit like hypocrisy, even though they aren't. Suppose a head of State was opposed to LSD, cocaine and heroin, but there was an electoral pressure to get all three legalised. Would it be hypocritical for our head of State to strive to get LSD legalised even though he was opposed to it?

 

Not necessarily. While he would prefer all three to remain illegal, he may sense that severe lobbying could bring about the legalisation of all three drugs, whereas a compromise of legalising LSD would be a more realistic goal for him. Instead of being hypocritical, it's more a use of ingenuity, and opting for a lesser of the evils.

 

So what of George Osborne then, is he being a hypocrite over tuition fees? The truth is, we're not sure - possibly only he and those that are close to him actually know. It could be that he used to be against tuition fees and then wised up once he thought about the arithmetic a bit more, and came to understand what balancing a budget is actually like in government. He may have simply had an epiphany about the prudence of price signals related to degrees, and that there is no such thing as a free lunch.

 

Or it could be that he is sullied with that quandary known as being a politician, whereby when you're itching to be in government you find yourself saying all sorts of sly and guileful things in order to get elected. George Osborne is simply going through the same kind of criticism we've seen levelled at Tony Blair, Nick Clegg and David Cameron in recent times - making promises they later went on to break in government. Doubtless, had they been elected instead, the same would be said of William Hague, Charles Kennedy, Michael Howard and Ed Miliband.

 

The upshot is, there is a real discontinuity between what politicians can promise out of power and what they actually have to deliver in power under the economic constraints of being the party controlling the purse strings. If you haven't learned the lessons by now, I'll summarise with succinctness. Take what elected politicians say with a large pinch of salt, but take what unelected, aspiring politicians say with a whole shaker full of salt.



Taxpayer-Funded 'Free Lunches' Are Choking Us

"Education is our right – we should be cutting tuition fees, not raising them”, declares Malia Bouattia in her Guardian column. It’s rare to see quite so much confusion all crammed into one article, but we’ve been through this before on this Blog (see here, here and here for example) so I won’t labour the points again.

There is a deeper problem, though, with tuition fees. According to Merryn Somerset Webb at MoneyWeek - one of the go to places for statistical updates - currently around 45% of student loans end up being written off, where the tipping point at which the whole thing starts costing rather than saving money is 48%. This problem is in part due to graduates earning less than expected, or sometimes nothing at all, but also due to the tax avoidance incentives woven into the system, such as salary sacrifice.

“With clever planning, an employee can use salary sacrifice to reduce their income below certain thresholds and therefore make further savings. Take student loans, for example; many students leave university with high hopes of landing a top job but can find themselves undone, with low pay and laden with debt. Repayment of student loans is 9% of income earned above £17,335 for those taking out student loans before September 2012, and £21,000 for those taking a loan out after 1 September 2012. This can often leave many university leavers with a lot less take-home pay than they need. Taking into account Income Tax and National Insurance, a graduate will take home just 59p in the £1 for part of their income earned above the repayment thresholds. This would further reduce to 49p in the £1 for income earned above the basic rate tax threshold and a quite frightening 32p in the £1 for each pound of income earned between £50,000 and £60,000 if the graduate has two children and is in receipt of Child Benefit payments.”

It's not exactly rocket science, is it? Suppose our graduate earns £30,000, and has a choice of putting money into her pension either via salary sacrifice or out of her net salary (whereby the tax is claimed back). If she does it using salary sacrifice, her official gross salary is not £30,000, it is £27,000. That cuts her National Insurance bill and her income tax bill – but most essentially, it also cuts her loan repayments from £810 to £540, where the resultant outcome is a take home pay of £20,907 instead of £20,277. That's all very nice for our graduate, but it's not such good news for taxpayers as a whole. It might well be time to ditch the salary sacrifice scheme.

The thing is, if the university supply and demand curves intersect - that is, if the demand for degrees and the supply of degrees are in market equilibrium, then a tuition fees system whereby the government loans to those who need the money to obtain a degree, and then only asks for payment when the post-graduate can afford to repay with a small proportion of their earnings, is not a terribly bad system. It's not perfect, but it isn't too shabby.

However, once the system becomes skewed whereby nearly half the graduates never pay back even a penny of their student loan, the alarm bells ought to start ringing, because it's obvious that this is down to there not being enough post-grads doing degree-level jobs. This is the market’s way of trying to tell us that there are currently too many people doing degrees.

Because the taxpayer picks up the cost of unpaid student loans, it means the surfeit of university degrees in this country end up being subsidised by the general public - many of which are low earners. Consequently, this means a great many of them are subsidising people that are doing degrees and never earning enough to pay them back, while the rest of the post-grads, the people that do pay them back, are people whose degree earns them a degree-level job, and whose lifetime earnings are likely to make them better off by approximately 60%. Any writer that entitles their article “We should be cutting tuition fees, not raising them”, really ought to think a bit more about the basics of arithmetic and supply and demand before waxing lyrical on this subject.

Four Quick Things This Week: Racism, The Minimum Wage, Hillsborough & The Blame Culture

Thing Number 1 - Racism

Don’t know if you picked up on this yesterday, but after the furore surrounding Ken Livingstone’s inappropriate comments about an easily identifiable group, there was a similarly inappropriate comment by Andy Burnham on Question Time last night, where he told us his policy about foreigners. He said that he’d like to introduce a law that bans an easily identifiable group of foreigners from being able work in the UK purely on the grounds that they are foreign. Of course, he didn’t use those words, he said it the other way round – that he wanted a law to protect British wages so companies could not look to recruit labour at a more competitive rate from abroad. Apart from the different choice of wording, the statements made by both men should have made the headlines as being dodgy – but, alas, we live in a society in which that is highly unlikely to happen.

Thing Number 2 - The Minimum Wage

So, a chap I know called John told me today that having applied for the government’s cycle to work scheme in which he purchases a bike and accessories, and through the salary sacrifice initiative makes savings of 42% via reduced tax and National Insurance contributions, his application has been rejected because the monthly deductions on this (don’t forget voluntary and beneficial) purchase will take his earnings below the legal minimum wage, and makes him ineligible for the scheme. 

Great – another of the many minimum wage stories of lament – the consequence of which, in this case, is that staff in his firm on 20-100k per year could obtain the full 42% tax savings on a bike, but John who earns just above the minimum wage cannot. You don’t have to be that bright to see what’s wrong here. I phoned on his behalf and made what was to me the obvious suggestion that in order that minimum wage earners don’t miss out they could extend the 12 month payback duration to 18 months to keep them above the earnings threshold, but they couldn’t alter it as it’s driven by central government. Thanks central government! Thanks Chancellor!

Thing Number 3 - Hillsborough

Despite his ill-conceived comment on Question Time, Andy Burnham covered himself in glory this week with his part in the Hillsborough inquest. The recent Hillsborough ‘Justice for the 96’ outcome was the end result of a controversial process that has lasted 27 years, largely to do with the issue of blame. Initially the police blamed the fans, but given the falsity of this claim it was always likely that eventually, and with an impressive degree of tenacity and perseverance, the campaigners would see the truth exposed – that, in fact, the police were to blame, as were the Football club, and many others involved in the organisation the of this tragic FA Cup semi-final event. The outcome has been pleasing not just because it’s good when justice prevails, but also because it is a lovely demonstration of how honest people working together for a worthwhile cause can find justice in the end and see that the blame is apportioned to the right people, which, as they knew all along, wasn’t the fans.

Thing Number 4 - The Blame Culture

Alas, unlike the Hillsborough campaign, quite often blame does not go to the right people. In a society solidly riveted to the recourse of the blame culture, this often makes for frustrating reading, particularly in the political arena. I’m afraid to have to say that very often politicians and the media get this backwards – that is, they go about their business in a culture in which too many people get blamed for things that aren’t really their fault, and don’t get blamed for things that are their fault. A lot of the things politicians do that are their fault – like imputing price controls, over-regulating industries, and creating artificial shortages – elicit praise and support from large swathes of the population when really these things should be met with ignominy. On the other hand, a lot of the things politicians get blamed for, for which the fault ascribed to them is an exaggeration – like crime levels increasing under their time in office, increased inequality, and increased poverty – elicit reproach and hostility when really these things should be opined about with a more balanced and informed view. 

The Market Of Dating & Mating

I stumbled on an article today that claims poorer couples are more likely to divorce than richer ones. The writer suggested a few reasons why this may likely be the case:

"Are poorer couples more likely to divorce because money problems put pressure on their relationships? Because they don't have access to the kind of marriage counselling available to richer couples? There's another possibility, too — Stevenson and Isen found that college-educated women are less likely to believe "financial security is the main benefit of marriage." So are less-educated, potentially lower-income women entering marriage more out of financial necessity than actual compatibility, then facing the cruel irony that they're more likely to divorce, leading to more financial insecurity?"

I don't see why - one argument is that rich people may have more at stake in terms on equity, but they equally will have financial security after the equity has been divided up. Are those the reasons most likely? Possibly, but perhaps they need to think a bit more deeply. Given that on average richer people tend to be the higher earners, and higher earners tend to be people with high intelligence, it is probable that in terms of the dating market, richer people are more saleable commodities, and thus may end up in higher quality marriages (part of this may need to be offset by the likelihood that such people would also fare better in the dating world post-divorce too, so may not feel so inclined to stay in bad marriages).

Or it could be that richer, smarter people are more discerning about choosing their beloved, particularly as they tend to marry later in life. Perhaps richer people are better equipped to negotiate those difficult patches in marriages than poorer people. Finally, given that in richer couples' marriage there is a higher probability that the women is educated, it is perhaps the case that the marriage is stronger by virtue of the fact that both partners hold a strong position in the marital decision-making.

The Economics of Dating
The market of dating is like the financial market in that it consists of buyers and sellers (the prime difference being that in the dating market buyers are also sellers and sellers are also buyers). Such markets would only be in equilibrium with an optimal adjustment of prices that enabled all participants to trade.

Consider saleability in terms of A-Z, where As are the most desirable (looks, character, education, intelligence, humour, earnings, sexual charisma, etc), Bs the second most desirable, right down to Zs, the least desirable. Say a B comes onto the market - he or she is going to be an 'expensive' proposition in terms of value in the buyers' market, because many buyers will be competing for that B.

After a cleared market you will find that, save for various exceptions, As, Bs and Cs tend to end up with other As, Bs and Cs, and so on. This is what they call assortative mating. It doesn't always turn out that way - but on average the probability that it will is compelling.

Let's simplify it by just looking at age - particularly in relation to the myth that 'men going for women half their age' is quite widespread. The likelihood is that it isn't. For a man to successfully couple up with someone half his age either he must have something worth selling (often money or high intelligence), or she will probably have not much worth buying.

Please understand these economic terms are not to treat people as commodities - they are illustrations for what is happening in the real world. If you're 25 and quite expensive in the buyers' market (i.e. a good catch) you're going to be looking for someone in your age range, unless you'll be prepared to compromise that for, say, an older gentlemen with higher earnings or high intelligence. If you're 25 and quite inexpensive in the buyers' market, you may settle for someone twice your age who is slightly more of a catch than the sellers in your age range. But these are more the exception than the rule: most people are not dating people half their age - and those that are will be people who have become or remained expensive in the dating market.

I read a similar report in the Guardian about a year ago, in which the columnist postulated that the rise of Internet dating was causing an increase in divorce and relationship breakdown because it was now so much easier to find someone other than your partner. While it may be true in a limited number of cases, overall it's very likely that the opposite is true - online dating is more than likely reducing the number of divorces and improving the quality of relationships.

Here's why. Where are you more likely to find a job - in a city or in a small village? Obviously it's a city because there are more vacancies in your increased search space. The introduction of online dating is a bit like moving from a village to a city - suddenly numerous possibilities open up as the number of prospective partners increases and access to them also improves.

To put it in market terms, the search costs go from low to high. People confined to jobs, dating or trading in their local village are going to have lower quality jobs, dates and goods because villages lack the multiplicity of choices that cities have. In a city you can afford to be more discerning and more patient as you take your time meeting lots of different people to find a high quality match. You are less likely to settle for a less-than-optimum choice of partner because the search costs are low. Thanks to the Internet, search costs just got even lower, which increases your chances of finding a more suitable partner, thus increasing the likelihood of a higher quality relationship and reducing the number of divorces or break-ups.

On Trade Unions & How Shockingly Bad They Can Be For Those They Claim To Represent

A friend asked me: are trade unions an essential part of a successful economy, or a hindrance to progress?

Here was my response to him:

I think the importance of unions is overstated - it is not the case that businesses wouldn't have progressed this far without trade unions, although perhaps slightly less quickly in terms of valuable things like workers' rights, health and safety standards, working conditions, and so forth. Unions have done, and still do, some good, under certain conditions, particularly with regard to working conditions.

But I'm afraid they do an awful lot of unintended bad too, and I have a classic real life example of this, as my mother was once in charge of the union in her place of work (a large printing firm). She was a formidable figure in the workplace, so I'm told (I was quite young at the time), and is to this day a lovely, caring lady - but alas, the stories she told me went on to horrify me, as I pointed out to her how bad the union's actions were for the firm (consequently, the firm has now, unsurprisingly, ceased trading).

The main error of reasoning that beset my mother's union (and numerous other unions too) is in mistakenly setting up a stratification between what's good for 'The bosses' and what's good for 'The workers'. The reality is, for well run businesses, what's good for the bosses is also good for the workers, and what's good for the workers is also good for the bosses, because both have vested interest in the firm's success, so should pull in the same direction*.

The story I am now going to tell has very slight embellishments, but not in any way that changes the moral of the story, or the kernel of facts related to the form's trajectory. The firm had 100 machinists operating 10 printing machines. One day the bosses looked to acquire the services of consultants to see if 100 staff was too many. The union kicked up a fuss to the extent that pressure was put on the bosses to withdraw that proposal. The union argued that the consultants were potentially a threat to some of the jobs.

When I said to my mother that if the firm could run with, say, 90 machinists, then it would be better for everyone concerned if they let 10 workers go (even the 10 in the long run), my mother asserted that that would be to fail to protect the jobs of the 10 workers, and that was her union's sole purposes - to stand up for the rights and jobs of the workers.

Here's what she doesn't understand. If her firm has 10 too many workers then it is not operating at maximum efficiency. The 10 superfluous workers are not only not adding value, they are costing the firm money. But what their continual employment in the firm does is make them less competitive, which means that competing firms whose worker to value ratio is more optimal will seize the advantage, most notably in lower prices that they can pass on to their customers. In advantaging rival firms, what my mother's union was doing was disadvantaging her own firm's 100 machinists, and ultimately the whole firm too.

To add to their imprudence, my mother's union thought it would be good to create a rule that said temporary workers had to be offered at least one week's work if they were needed for any length of time. I said "What about if they just needed the temps for a day or two?". To which my mother replied "It wouldn't matter, we'd still keep them for a week. In fact they often had quiet spells that lasted several days with nothing to do".

I replied "Didn't it occur to your union that they were costing the firm unnecessary money, and that it would have been better to have scrapped the one week rule and just have temps in for time they are needed?". "No", she said, "That wouldn't be fair on the temps."

A few years later, my mother's firm went out of business. I certainly wouldn't go so far as to say that it was entirely the union that caused this - there were other factors too. But reading above, I hope you'll be able to agree that they didn't help the firm's finances, and spent a lot of time hindering their ability to be competitive, even though they didn't realise the harm they were doing in stifling efficiency.

The other danger of unions is that they are often trying to get better pay for their employees with scant regard for whether that sum is above the market value or not. If 90 workers have a market worth to a firm of £3500 per week, and their union demands they are paid £4000 per week, then in the long run it is going to be bad for everyone at the firm. Given that employees won't often know the real market value of their labour, it is always likely that they will distort pay levels detrimentally.

The other intangible effect of this is hurting other workers too. To illustrate this in simple terms, suppose there are six groups of workers: printing machinists, retail workers, building trade workers, clothing factory workers, agricultural workers and steel workers. Suppose that after union coercion, the steel workers weren't able to raise their wages, but agricultural workers raised theirs by 10%, clothing factory workers by 15%, building trade workers by 20%, retail workers also by 35%, and printing machinists by 50%.

Given that wage rises are passed on in the shape of price rises for the consumers, let's see how this benefits the groups. With the figures above there has been an average wage increase of 21.6%, so if we assume the same for prices (the figures won't exactly match for reasons too complex to go into here, but they'll be along similar lines) then as you can see, the benefits go to printing machinists and the retail workers, but building trade workers are now slightly worse off, clothing factory workers even more so, agricultural workers worse still, and steel workers worst off of all. Four of the six groups have been made worse off by the aggregate wage rises, and that's not even to mention the increased unemployment that would come from such demands for higher labour, and possible liquidations too if firms have competition from aboard who can be more competitive.

I’m not unsympathetic to many of the ways that union members like my friend are good people to have around, to ensure good, harmonious and safe working environments, because sometimes those voices apply necessary duress on bad senior staff. However, in order to ensure there is no bad to accompany the good work, the main thing that must be avoided at all times is distorting the natural market value of prices – that is, the equilibrium point at which supply is equal to demand. Prices are an incredible thing – they inform us of people’s wants and needs. They are information-carrying, like a democracy. If the price of oranges is more than the price of apples, it tells us all sorts of things about the supply and demand curves of both. If prices of DVDs are low, and getting lower, it tells us that there are newer more popular technologies on which to watch movies. If you find it hard to locate a pay phone on the street, it tells you that demand for them has all but vanished (even most elderly people have a mobile phone now).

As you probably know, a price ceiling is a form of legislation by the government that says the price of x must not go above their ceiling price. Bear in mind that the price of a good is nigh-on optimal if set by market forces. Therefore if the government's price ceiling is lower than the market value, demand will rise and supply will fall, creating a shortage. Rent controls are an example of a price ceiling. Property investors are less likely to invest in housing, which creates a shortage as rents can no long reach their market value.

A price floor is a form of legislation by the government that says the price of x must not go below their floor price. Therefore if the government's price floor is higher than the market value, demand will drop and supply will rise, creating a surplus. The minimum wage is an example of a price floor. Employers are less likely to hire staff, which means an increase in unemployment. If unions find themselves distorting the natural market clearing rate of prices, then they are doing a lot of harm (to everyone) that is probably invisible to them.

* If you're interested, I wrote a nice little ice cream analogy to convey that point, in this blog post)

Why Is It That Pretty Much All Projects Overrun?

Why do projects nearly always take longer than scheduled? You know the score - you've seen it many times before: some large firm wins the tender to undertake mass refurbishment on a large government building, or to build a new distributor road stretching several miles, and inevitably the project overruns and the initial budget put aside proves inadequate to the completion of the job.

But why does this happen so frequently? The reason is quite straightforward; it is because the estimated time is a predictable underestimation - a phenomenon that greatly increases with the complexity of a job. And time is, of course, money.

Writing a blog post is quite straightforward, so if I set myself 20 minutes to write it (or less with short blogs like this one) it isn't difficult to stick to the deadline. But projects like big building projects, even when an up-front fee has been agreed and the incentive is to complete it as quickly as possible, are highly likely to overrun - quite simply because our highly consistent underestimation of time at each stage of a project is going to be multiplied with every further stages of the process. It is the individual probabilities of stages multiplied that is the key to the explanation.

This is what is commonly known as the "planning fallacy" - whereby for every step in a project, there is around a 50% chance of that stage being completed over the estimation time. Once you plug in the numbers, that means that for a project of two steps there's a 50% chance multiplied by a 50% chance, which means for two steps the chance of overrunning is now 75%. For 3 steps it's 50% * 50% * 50%, which means there is an 87.5% chance that out of a 3 step program it is going to overrun. Consequently, then, a project in which each constituent step has only a 50% chance of not overrunning, means that for every step the probability increases by x 1/2, which means that projects with multiple steps are nigh-on certain to overrun.

A Tenuous But Probably Well-Observed Correlation

In the penultimate chapter of his book The Better Angels of Our Nature: Why Violence Has Declined, Steven Pinker attempts to bring together the tenuous linking of increased free market libertarianism and increased peace:

"To think like an economist is to accept the theory of gentle commerce from classical liberalism, which touts the positive-sum payoffs of exchange and its knock-on benefit of expansive networks of cooperation. That sets it in opposition to populist, nationalist, and communist mindsets that see the world's wealth as zero-sum and infer that the enrichment of one group must come at the expense of another."

In my case, he's pushing at an already open door with a comment like that, but then I'm not one of the people that needs convincing - I mean, as I've blogged about a couple of times now, it's pretty evident if you look the nations that most espouse economic freedom, democracy and liberalism, they are pretty much always the most peaceable countries too.

As well as the obvious point - that free trade is underwritten by co-operation, empathy, and a stable rule of law that protects individual rights - what Pinker means by 'thinking like an economist' is probably that people well versed in economics are not so heavily sullied with the divisional myths that pervade the left; like for example, class stratification, wanting to forcibly confiscate wealth from higher earners (the higher the taxes the better), enviously resenting those who are successful, failing to note when value is being created, falling for the fixed pie fallacy and feeling a false sense of entitlement for what others have acquired, thinking that the economy is zero-sum, lamenting when other more competitive industries prove to be more efficient than industries in their own country, and treating others as less important if they happen to belong to a country outside of their own geographical borders.

The link between peace and the free market is tenuous, but that's only because the entirety of our global interactions, past and present, amounts to a vast nexus of tenuous and complex correlatives. And it's not the first time that we've talked about it.

Wow, Just Wow! Whatever Happened In Society To Take Us Back Down This Road Again?

Oh heck, where did it start to go wrong again? As I'm sure you can remember, we used to be pretty repressive when it came to personal liberties, where anything deemed too offensive for social mores was frowned upon, contested and sometimes banned. Radio stations would not play The Rolling Stones' Let's Spend The Night Together; the film Last Tango In Paris caused uproar, as did Monty Python's Life of Brian. It even used to be difficult to be openly gay, or be involved in a mixed heritage relationship.

It's easy to look back and recoil at past attitudes, but we did seem to get a little better. We stopped being so intrusively upset about people's works of art, and about how they expressed themselves, and we grew the hell up about who people had relationships with. 

But alas, recently we seem to have gone backwards again. I can't recall precisely when - it seems to have insidiously crept into our society, but we started to find ourselves surrounded by spineless busybodies who get offended too easily in the absence of a rigorous argument or any notable reasoning skills, and thought it was their right to do so in a way that meant everyone else had to be very afraid of offending them.

And it seems they got their wish, because what emerged from this national paranoia was an even larger bunch of busybodies - those even worse than them: the people who get offended on their behalf. We've become so used to seeing people afraid of upsetting or offending other groups that it no longer surprises us when we hear of the latest person who cannot comfortably wear their crucifix necklace at work, or the latest group to be guilty of 'cultural appropriation*' for wearing sombreros on a night out, or the latest university that creates ‘safe spaces’ to protect the right of some students not to be offended (heck, did they forget that free expression, argument and debate are the essential tools for learning and for challenging bad ideas?).

What has caused us to journey from lily livered impotents to reasonably intrepid proponents of free expression back to lily livered impotents again? I can think of two main changes that might have altered the public consciousness. In the first place, the country now has a lot more diversity, which means there are a lot more minority groups with views that differ from the mainstream. And in the second place, computer technology has undergone radical changes, which means there is mass communication going on, and also that everything everyone does it pretty much under external scrutiny now.

Personally I see no reason why either of things should cause us to become spineless again, but it would appear that we have. Diversity of people has generated an unprecedented range of beliefs, opinions and cultural practices that appear to make many people uncomfortable in expressing themselves for fear of upsetting someone, or being labelled a racist or bigot. The widespread fear of upsetting Muslims is perhaps the most obvious case in point. And the extent to which everyone can have their say on social media is unprecedented too - it appears to be bringing with it a huge rise in vile threats and guttersnipe abuse, which as a consequence appears to be making many people fearful of free expression once again. But I've said it before on here, and I'll say it again - we must stop this train of timidity in its tracks as soon as possible. 

To finish, I want to leave you with a video doing the rounds at the minute - of a black campus employee confronting a young white male who has his hair in dreadlocks. Alas, this video is isn't exactly an isolated incident - hardly a day goes by without someone asserting that how someone looks, the clothes they wear, the statue they had erected, and so on, has suddenly become racist or simply deeply offensive to a minority group.

What you have to ask yourself is, what forces occurred in that young lady's life for her to so aggressively demand that a young white man's freedom to wear his hair in dreadlocks ought to be denied? She didn't just suddenly decide this for herself. Who has done such a number on this (probably) otherwise bright student to cause her to uncritically and unashamedly declare that this so inextricably belongs to 'my culture' that it trumps any personal freedoms you might have on this matter - was it parents, friends from the same 'culture', or was it those pervading busybody trends I mentioned earlier, insidiously creeping back into our society, and showing increasing signs that this is just the thin end of the wedge? Things have got to change all over again!

This Should Create Mass Anger, But Instead It Creates Mass Joy

With the recent introduction of the living wage the red socialist in blue conservative clothing chancellor George Osborne made it clear once and for all that he is just as careless about basic economics as the opposition parties, that he has scant concern for the economic well-being of the people of this country, and that pre-Prime Ministerial popularity is his main agenda.

The living wage price floor is now £7.20, up from £6.70 under the old minimum wage, and within four years it will be over £9. I have written repeatedly about all the ways this is a terrible idea, but I have not gone into as much depth as I'm now going to about how politicians play on this public credulity in such a shameful way. And I'm sorry to have to be the one to tell you, but it is shameful - it's shameful because it's driven by falsity and conceit, and I hope after reading this you'll understand more about why this is the case.

I lamented in a recent Blog post about how the people that govern us make decisions of popularity, not of prudence, based on the fact that the majority of the people they govern prefer popular myths over prudent truths. Consequently, when you have an electorate that is in this position it is incredibly easy to sell them things they think are good for them but are actually not. To understand this, we need to go over the basic economic fallacy that underpins almost all other related fallacies - it's what Bastiat summed up in his seminal essay "That Which is Seen, and That Which is Not Seen" - which is basically about how economic decisions have far-reaching effects beyond the immediacy of our perceptions, and that any idea or policy has to factor in everyone who is affected (It's what I like to call the tangible costs, the tangible benefits, the intangible costs and the intangible benefits, touched on in this Blog post).

It is no exaggeration to say that just about every bad economic idea or imprudent policy in politics is down to the fallacy of only thinking about the immediate effects on an easily identifiable group rather than thinking about the effects on everyone, in the immediate and long term too. The art of a prudent policy is in tracing its consequences everywhere, not just in one easily identifiable place (for more on that, see this Blog post of mine). It is because the vast majority of the public only think of policies in terms of one easily identifiable place that politicians so readily impose these imprudent policies on us. Only when the populace wises up will there be selection pressure on politicians to wise up too.

This State-mandated living wage of £7.20 an hour benefits a select group of people (a proportion of low skilled workers) but harms just about everyone else (employers, the people that lose their jobs because their employer has to let some staff go, the consumers who have to pay higher prices, the hundreds of thousands of people whose labour is not worth £7.20 an hour to a prospective employer, and at a broader level, the nation as a whole as State-mandated price fixing makes other places more attractive places to invest).

To see why labour price controls are always bad, we first have to understand what labour is. Labour is a commodity - it is a substantially marketable sale of work sold to create value. Its price is dictated by supply and demand, which involves the aggregation of billions of choices, wants, needs and desires going on in the world at any one time. There is no such thing as a 'fair day's pay' or a wage someone 'deserves' or a 'just' wage - they are completely alien to a proper understanding of economics. They are emotive terms uttered only be people who don't have a full picture of how prices are dictated.

Who benefits from labour? The answer is everyone. The person selling his labour, let's call him Fred, benefits because he chose that option over the next best option. The employer benefits too because it's that labour that helps him make a profit, as do all the places Fred spends his money, as do all consumers generally.

How do you know if you are of value to your employer? Easy – your value can be measured by what’s called the marginal revenue productivity of wages, which is basically the benefits your employer earns from employing you. If your wages are more than your marginal revenue productivity then you earn more than the sum total of value you bring to your company.

On the back of that, two things set wage levels, primarily. Firstly wage levels are determined by the skill level of the job in terms of how easy it would be for the next person in line to come in and do the job. A McDonald's burger flipper or a Sainsbury's shelf stacker do not command high prices for their labour because it is easy to replace them in the job centre queue as the job is easy. Lawyers and surgeons command high prices for their labour because it is not easy to replace them in the job centre queue, and their jobs require lots of studying and training.

Secondly, wage levels are determined by which other job opportunities the worker has. Business owners are not just competing with the goods or services they sell, they are also competing in the labour market too. Suppose Sainsbury's has the profit-scope to open several more stores. To do this they need to buy labour, which means either hiring people currently unemployed, or hiring probably better people already doing similar work. To do the latter they must offer higher wages (or some other benefit) in order to attract these workers. So wages are set not just by who is next in line relative to the skill level of the job, but also by how many rival competitors want to buy your labour too. Your pay working for x will be contingent on what y and z are willing to pay you, because x, y and z are in competition not just for bread, milk and cereal, but for the labour upon which their profits are based.

Osborne's popularity-over-substance Living Wage price floor ignores all this, plus it ignores all the harm done to small businesses, to currently unemployed people, and all the soon to be unemployed people. Why aren't the people cheering the Living Wage thinking of these hundreds of thousands of people - the 'unseen' in Bastiat's equation? How come no one thinks about all the elderly people or already struggling people that get hit in the pocket by the higher prices that businesses introduce to pay for this? These are the people that proper economic considerations demand that you factor in too.

The hotel workers and waitresses and bar staff enjoying their extra £20 a week owe their gains to consumers, including students, the elderly and unemployed people, who are forced to pay the higher prices that fund those gains. The net gains to the winners are dwarfed by the net costs suffered by the rest of the population (most of the businesses affected by the Living Wage don't actually make very much profit, by the way).

If George Osborne wants a genuinely prudent solution, why won't he do the good thing for low earners that also isn't the bad thing for employers and consumers and the unemployed, but is somewhat less popular - take low earners out of tax and national insurance, thus making their wage more like a living wage, but not increasing consumer prices and jeopardising employment levels and penalising employers of low-skilled workers? Oh yeah, question asked, question answered, it's somewhat less popular - and he does want to be Prime Minister, of course.