Bruno Prior's blog

Independent from reason or responsibility

The Independent led yesterday with a report on Greenpeace's attempts to prevent BA opening a service from Gatwick to Newquay. Their strap-line in the print version read:

"The battle of Newquay. British Airways faces a showdown with the green lobby over a new daily service from London to Cornwall. The fight may determine whether the booming aviation industry can be brought back to earth."

It is clear where The Independent's sympathies lie. They include an op-ed piece from Emily Armistead of Greenpeace, entitled "Fastest way to damage the earth". Yup, those pesky flights to Newquay will be the ruin of us all.

Just one small problem. Can you see what it is?

Article on preventing flights to Newqay, surrounded by adverts from Lufthansa for flights to Kolkata, Kuala Lumpur and Singapore, and a promotional on Jamaica

Whatever you do, don't get an education

Or your children will suffer. Headline in The Times today: University squeeze on children of graduates. Is there any need to say anything more? Can't get a much more obvious example of government picking losers. It's us. All of us (rich and poor alike).

Let's encourage the "right" people to go to university by telling them that they will then become the "wrong" people. Their children will have less chance of going to university than the children of people who were excluded in this generation. If you want the best for your child's education, make sure you marry someone with as little education as possible. Logic problem? Mixed message? Downright stupidity?

Reform of party-funding - all yours for £13.50

In a move that is almost beyond parody, Sir Hayden Phillips - the man who thinks our political parties would be cheap at £25,000,000 a year - thinks £13.50 is good value to tell us what good value the parties are. That's what a copy of his report costs. 45p a page. Of drivel. That's a report we've already paid for, by the way.

To be fair, though, it's been hard work for him. 12 months to produce a 30-page report was a tough ask. Nor can it have been easy to arrive at the conclusion that the big parties should get lots of money, but had better sit down and sort out the details between themselves.

At least we can be sure that the process will have our best interests at heart. After all, the parties are the best people to decide how much of our money we ought to give them. Who else would appreciate the great contribution they make to our democratic process? And lest we suspect them of self-interest, Sir Hayden has guaranteed their honesty by recommending that their private discussions be subject to "independent oversight". Not that this be debated openly, mind you, because too much openness is a dangerous thing.

Perhaps I should try Sir Hayden's magical technique for discovering best value in my business life. When it comes to negotiating new prices with our suppliers, I shall invite them to get together to work out what is the right amount for us to pay them. Our employees will be instructed to put their heads together to work out how much they should get in this year's pay deal. And I have the advantage that our suppliers and employees know that pushing for too much will lead to unfortunate consequences, like taking less of their product, making some of them unemployed, or simply going out of business. If it works for us consumers of the services of political parties, who could take us for all they like so long as they stick together, it is bound to work for me.

Environmental risk

I'm feeling rather pleased with a comment I posted to a thread on the website, so I'm going to post it here too.

Jonathan Pearce had posted a thoughtful piece to Samizdata on the merits of David Cameron's announcement on rationing air travel, in the course of which he allowed that DC might genuinely have the interests of the poor at heart, but pointed out those interests were in the future, and asked "Why should a politician, answerable to an electorate, sacrifice or ask to sacrifice its interests for the interests of people in such a long time to come, and over a theory or set of theories that are, at best, not proven to the standards of a court of law?" Sounds like a good libertarian perspective, and many had agreed with him in more colourful language, accusing DC and his ilk of being fascists. Such exaggeration is often a good sign that people are thinking more with their guts than their heads, a habit discussed in my "Post-rational" post.

Know how he feels

I've added a link to the Not Proud of Britain (But Would Like To Be) blog, simply for this comment on the Bloggers4Labour blog. It is one of the most intelligent observations that I have seen on the false economics of the Government's road-pricing scheme. Does the Government really think that people sit in rush-hour traffic for the hell of it, and that all they need is a financial incentive to get them to drop off the kids or go to work at a different time? It's not difficult to spot the flaw in the plan, is it? Headmaster/mistress and boss may have something to say about it. Snafu sums it up superbly in the language of economists. What a pity a blogger has a better grasp of economics than the large number of academic pseudo-economists who have come out in support of road-pricing simply because it looks superficially like a market.

Global warming balance

Last night's Dispatches report on the Great Global Warming Swindle brought some welcome balance to the climate-change debate. Not because the programme itself was balanced - it was completely one-sided in favour of the sceptics - but because the other side of the argument (the alarmists) has been given almost all of the air-time for the past few years. We are constantly told by politicians, publicists and much of the media that there is scientific consensus, that the debate is over, and that it is somehow morally wrong to question the science. Well, there is clearly not consensus, the debate is not over, and suppressing debate is a whole lot more morally contemptible than trying to raise it (stand up and take a bow, all you Royal Society representatives, for your ignoble role in the effort to suppress debate).

Having said that, some climate-change sceptics are as inclined to grasp any evidence as complete refutation of global-warming theory, as the alarmists are inclined to interpret any data as further evidence to support their beliefs. So in the interests of balance, here is a link to the best-informed article I could find that provided counter-arguments to those in the programme.


Charles N. Steele wrote a funny little comment on Hot Coffee Girl's blog a while back, about not defining oneself as a "non-smoker". Recent encounters with various pseudo-intellectual movements defining themselves as post-this or post-that got me to thinking that the prefix "post-" probably deserves similar contempt for defining oneself not in terms of what one is but in terms of what one is not.

There is a debate going on at Charles's site about a strange concept called post-science. Though much of the argument is esoteric, I recommend it to you for the entertainment value of the claims of the post-science spokesman (and of the websites that he points to), and as an illustration of the difficulty of reasoning with people who consciously reject rationality, and of where such a rejection gets you to.

Bioethanol - winner or loser?

The production of ethanol from corn as a replacement/supplement for petrol is coming under increased attack from environmentalists. This month's Ecologist and today's Independent both led with a destructive assessment of its merits.

I do not claim to know whether ethanol is a good or bad solution to our energy problems. But I do know that George Bush and Tony Blair don't know, and neither do Zac Goldsmith (editor of The Ecologist) and Simon Kelner (editor-in-chief of The Independent). Because they are trying to establish the case by claim, counter-claim and posturing, little light is shed on the issue. And because no mechanism exists that simply values carbon equally from all its sources, we have no way of discovering in a market the reality that is being obfuscated in discussion. As usual, sweeping generalisations ("this technology is good/bad regardless") that ignore changing circumstances are a good sign that people are busy picking losers rather than allowing the most efficient and appropriate solutions for the circumstances to emerge and evolve.

Sometimes the debates seem intended to confuse, not illuminate. Perhaps this is the real objective. For an alternative take on the ethanol debate in America and people's motivations in presenting their arguments, have a look at the What's That Smell? site. The author's hostility to a local development has produced a scathing analysis of the process by which politicians and lobbyists adopt and promote losers for their own interests. Just remember that the other side - opponents of ethanol - have their own agenda too.

Appropriate incentives

The Economist has been talking up prize-giving as a good way to get the maximum bang for your charitable buck. In response to a flippant remark, suggesting prizes to solve the riddle of the missing NHS billions, from the excellent Dr Steele of Unforeseen Contingencies, I have added a discussion on the merits of offering prizes and other ways of encouraging outcomes that are perceived to be for the benefit of society, to the thread in which the comment was made.

In short, prizes, grants and arbitrary, government-defined, incentivised targets are all as bad as each other, even if they are dressed up in market clothing. They are all forms of "picking winners" (i.e. losers). They dominate policy in the UK at least, and I suspect most of the rest of the world. We need to replace the massive infrastructure of state preference with institutional protection of property rights (including the extension of that protection to cover real "externalities", where the external impact of one person's activities has a material and uncontracted impact on another's person or property) and free access to markets.

Testing Gordon

Francis Maude argued on tonight's Question Time that it would be good for there to be a serious contest for the leadership of the Labour Party, as Gordon needed to be tested. Was he admitting that members of his own party are not capable of testing the Chancellor?

Our very British Chancellor

He's at it again, our Chancellor, talking about Britishness. That is one paranoid Scot. Does he not realise that dissecting Britishness is profoundly unBritish, and that real Brits have the self-confidence in our culture not to need to define it endlessly? Has he not noticed that we've been pretty fond of some Scots even in recent times. If we don't like Gordon Brown as much as we liked Robin Cook or John Smith, or even as much as we like John Reid, Ming Campbell and Charlie Kennedy still, it is not because he is Scottish, but because he is Gordon.

It is one thing to be the pub bore on the subject. It is another to try to get sympathy by picking on others less fortunate than himself. Gordon thinks that "it is right to consider asking men and women seeking citizenship to undertake some community work in our country or something akin to that that introduces them to a wider range of institutions and people in our country prior to enjoying the benefits of citizenship". It's a garbled sentence expressing garbled thought.

What immigrants need as much, if not more than anyone, is to find a job and make a life. That is how they will fit into and contribute to our society. Why would we place on them a burden that is otherwise placed only on convicted petty criminals? What will that prove? How will that help them to adapt to a British way of life (other than the criminal British way of life)?

If we want a test by which we will judge whether an immigrant is fit to enjoy British citizenship, having held down a job for a sufficient period of time would be a much better test than having undertaken community work.

Does work work?

Lord McKenzie of Luton, Parliamentary Under-Secretary (Lords) at the Department for Work and Pensions, today "called on the expertise of businesses, government and charities to discuss and agree what constitutes 'good work'." As he explained, "we need to figure out exactly what 'good work' is, so that we can ensure workplaces are happy, healthy and productive".

Here we go again. To Labour, everything is standardisable and reducible to the average or the lowest common denominator, and then enforceable by government mandate. In their eyes, my idea of what constitutes "good work" must be the same as yours, which must be the same as everyone else's. All they need to do is work out what this standard of "good work" consists of, and then insist that all jobs conform with this standard.

Why cannot I decide whether a job is acceptable to me, and accept or refuse employment offers accordingly? If the quality of my job disappoints, why can I not be left to decide whether it is sufficiently disappointing that I should look for a new job? If I can find nothing better than my existing job, am I better off having my unsatisfactory job regulated away (assuming my standards of satisfaction conform with the average), or putting up with something less than perfect until something better comes along? Why does government need to intervene in this area? My terms of employment are a matter for me and my employer alone.

Government-created cartel

It is a commonplace of economics that competition drives down prices. Economies of scale drive down costs. The combination of the two may achieve the lowest prices. But normally one would not expect cartels to deliver low prices, however much the privileged position of the cartel-members allowed them to achieve economies of scale. Rather the reverse.

Not according to this Government, though. In setting up Phase 2 of the Low Carbon Buildings Programme, they have consciously created a 7-member cartel in order to generate economies of scale. Here is the justification from the DTI website:

"Phase 2 has an innovative design – a framework-type arrangement has been set up in order to provide an element of certainty for those suppliers who successfully competed to be part of the framework. Recipients of grants will have to purchase their microgeneration technologies from these framework suppliers. This should allow those suppliers to offer lower costs (with the larger volumes bringing economies of scale) and, in the knowledge they will be receiving large numbers of orders, feel able to make the investments in the supply chain required to develop the microgeneration industry."

The £50 million scheme is limited to five technologies: biomass heating, ground-source heat-pumps (GSHPs), solar thermal, solar photovoltaic (PV) and wind. It is limited to projects of specific size (no more than 50 kW electrical or 45 kW thermal). It is limited to the public sector and charitable organisations. It is limited to seven "framework suppliers".

It does not even treat the selected technologies or suppliers equally (details obscured in the FAQ for the scheme). Some suppliers are eligible to supply some technologies, and some are eligible to supply others. Only one (British Gas) is eligible to supply all technologies. No more than three of the seven is eligible to supply any one type of technology. If you want a combination of more than one technology, your choice is likely to be down to one or two potential suppliers.

Even the technologies included within the limited range of options are treated differently. While some renewable technologies are excluded completely, even those technologies that have been included do not face a level playing-field within this very partial structure. Photovoltaics are eligible for 50% grants, GSHPs and wood-fired boilers for 35% and solar thermal and wind for 30%. The justification provided for this differential treatment is that "The grant percentages are based on analysis by the DTI." Very enlightening.

Trading favours

David Miliband has prepared (with the help of Alistair Darling and some big businesses) a manifesto for the development of the EU Emissions Trading Scheme (EU-ETS) after 2012 (Phase 3). He has circulated it to trade associations and big business (or "British industry", as he likes to call it, forgetting as usual about the majority of smaller businesses), asking them to endorse it. The manifesto and its covering letter are attached.

His attitude to "UK business" is summed up in the following sentence from his covering letter:

"Our initial impression of the level of consensus on EU ETS was confirmed when we met some key industry figures to discuss the manifesto in November."

How can you test a level of consensus by meeting some key industry figures? Isn't the definition of consensus that it includes the many, not just the few? If the few tell you that there is consensus amongst the unconsulted many, are you a wise politician to believe them? Even if it were the view of many, should you do what is wanted by the majority (or even the consensus) amongst a particular interest-group, or what is right without reference to interests? Most of us want taxes to be lower, but his Government seems to care less about the consensus on that subject. How do they decide which consensus to listen to and which to ignore?

It used to be said that "UK business" wanted us to go in to the Euro. Now it is said that "UK business" does not want us to go in to the Euro. What is meant is that the majority of bosses of big City institutions and major corporations used to think that the Euro would be good for their businesses, and now the majority think it would be bad. That is not the same thing as the opinion of UK business (even if the Confederation of Big Industry says it is). The Government's reliance on the self-interested, vacillating, superficial assessments of this "elite" is what makes policy so inconsistent and unprincipled. The attitude to EU-ETS and their alliance to produce this manifesto is just another example.

Understanding the law

Ignorance is no excuse in the eyes of the law. Enforcement of the law (and therefore social order) breaks down if this simple rule is not upheld. Is there not, then, a moral obligation on our legislators, enforcement-agencies, and judiciary to ensure that the law, its interpretation and its application, is reasonably comprehensible, memorable, consistent and capable of compliance by those to whom it applies? In other words, it is only reasonable to expect people to inform themselves of state-sanctioned standards of behaviour and to behave accordingly, if it is reasonably practical for them to do so.

How to choose the right course of action

Anyone (other than the specialists who get paid to produce them, or pressure groups and politicians who use them to justify intervention in favour of their special interests) who has looked with a critical eye at the Cost-Benefit Analyses, Regulatory Impact Assessments, Environmental Impact Assessments, etc. that accompany voluminously any piece of consultation, legislation or regulation nowadays will know that they are incomprehensible, pseudo-scientific claptrap claiming to predict the unpredictable and usually in practice justifying the unjustifiable.

But surely, the counter-argument goes, it would be irresponsible of the government to proceed without trying its best to assess what might be the results of the policy it is considering. However inaccurate such assessments might be, they are better than no assessment.

I am currently reading The Foundations of Morality by Henry Hazlitt, author of the seminal Economics in One Lesson and, though not widely acknowledged by academia, one of the great thinkers of the twentieth century. I, like Hazlitt and his great mentor Ludwig von Mises, subscribe to the rule-utilitarian approach to moral philosophy. Whilst reading Hazlitt's book, it is becoming more apparent to me what a close connection exists between the alternative moral philosophies and the alternative methods (such as the above bureaucratic approach) by which legislation can be shaped and justified. In Jeremy Bentham's words (that strongly influenced Hazlitt's book), "Legislation is a circle with the same center as moral philosophy, but its circumference is smaller."

For those who believe in a god or gods, the question of morality is an easy one - right and wrong is simply what is specified in the texts. But with the weakening of the moral authority of the church that accompanied the Enlightenment, there was a need for an alternative basis for morality - a method for determining what is right and wrong without dependence on the word of a higher being. The solution developed by a series of great philosophers (most famously David Hume, Jeremy Bentham, and John Stuart Mill) became known by Mill's term: Utilitarianism. In the words of Bentham (with whom the concept is most closely associated): "Morality is the art of maximizing happiness: it gives the code of laws by which that conduct is suggested whose result will, the whole of human existence being taken into account, leave the greatest quantity of felicity."

The above quote, from the posthumous compilation Deontology, expresses a view that is characterised nowadays as rule-utilitarianism. In his earlier works, Bentham had appeared to promote an alternative form, known as act-utilitarianism: "that principle which approves or disapproves of every action whatsoever, according to the tendency which it appears to have to augment or diminish the happiness of the party whose interest is in question....I say of every action whatsoever; and therefore not only of every action of a private individual, but of every measure of government" (from his An Introduction to the Principles of Morals and Legislation). The difference is that act-utilitarianism attempts to judge the impact on total happiness of every action, whereas rule-utilitarianism specifies that the morality of actions should be judged by their conformance with general rules, whose merits have been calculated to promote the maximum happiness if followed by everyone.

Our politicians and civil servants certainly seem, in recent years, to have taken seriously Bentham's instructions to consider, for "every measure of government" the utility of the measures under consideration to "the party whose interest is in question", i.e. "if that party be the community in general, then the happiness of the community". And very worthy it sounds too. But there are problems with this approach, sufficiently intractable that few people would now promote pure act-utilitarianism as a sensible basis for action.

1. What is the measure of the happiness of the community? Happiness is experienced only by individuals, so the happiness of the community must be the sum of happiness of the members of the community. To calculate that sum requires an effective method of hedonistic (or felicific) calculus, which has escaped Bentham and his successors. If an action makes me happier and you less happy, how are we to decide whether the total change in happiness is positive or negative? We cannot even say that the change is positive if it increases the happiness of more people than it decreases. Murray Rothbard (emphatically not a utilitarian) gives the example of 99% of the population deciding to enslave the other 1%. This is the illusion underlying the King of Bhutan's Gross National Happiness index, and David Cameron's replacement of GDP with GWB (General Well-Being) as the guide to public policy. It tends towards governance in the interests of the majority, which can be a very dangerous thing.

2. Even if it were possible to calculate the impact of each action on the combined happiness of all those affected, one cannot live life this way. I should not decide whether to stop at a red light by trying to weigh the time-saving benefit of proceeding against the possible impacts of doing so. We have neither the time nor the ability to weigh all the impacts on all the people who may be affected by all the decisions we take. In most cases, we have to act according to general rules that, if followed, should lead to a good outcome in most instances. In other words, we are all rule-utilitarians, if only by force of necessity.

We know the importance of general rules for our own actions. But modern government, full of the arrogance of power, believes itself not to be subject to these limitations. No longer do we draw up legislation according to the good judgment of intelligent people, following general rules that can be shown to maximise the welfare of society.

Modern government forgets about general principles and instead tries to weigh the consequences of every piece of legislation and regulation for every party affected by the measure under consideration. That is what CBAs, RIAs and EIAs (not to mention focus groups and polls) are for. It is an impossible task. But while they continue to try, our legislation becomes ever more complex, contradictory, unprincipled and counterproductive.

The first step in improving the quality of our legislation (not to mention saving money on the legions of consultants who prepare these useless pieces of paper) must be to scrap the CBAs and go back to governing and legislating according to principle. This will not only improve the legislation, but also restore the battle of ideas to the centre of political discussion. The debates can return to the question of which principles are best to maximise the welfare of society, not who can best micro-manage the economy. That cannot but help alleviate the public disengagement with the political process.

An interesting fact

Well, to me anyway....

In 2004, Ukraine was the fifth-largest importer of natural gas in the world. Belarus was the tenth-largest. In 2005, Belarus had dropped out of the top-10, not because it had reduced its consumption (net imports had increased), but because some countries, like the Netherlands, had increased their import requirements more dramatically. Ukraine remained fifth, and had increased its imports of gas by nearly 15%. Together, they absorbed nearly 40% of Russia's exports, and nearly 10% of all the exports of gas in the world.

Ukraine has the 25th largest population in the world. Belarus has the 81st.

Ukraine's economy is the 53rd largest in the world, Belarus's is the 69th (according to the IMF).

In terms of GDP per capita (a reasonable measure of relative prosperity), Belarus ranks 110, Ukraine 120.

How do these countries afford to import so much gas? Are they using it productively?

We should be concerned about Russia using its energy resources to apply political leverage. But with regard to the former Soviet Bloc, is it possible that President Putin has a point when he claims that gas to his neighbours is underpriced?

Environmental showboating

Richard Branson is going to create an "environmental showcase for the world" on the Caribbean island of Moskito. He "wants to transform Moskito into the world’s first carbon-neutral holiday resort, complete with wind power, recycling and Balinese-style huts for eco-friendly families."

How are these eco-friendly families going to get there? What are they going to do with the recyclate? What happens when the wind isn't blowing hard enough (which is a lot of the time on the British Virgin Islands)?

The answer is blowing in the wind

I am no fan of wind energy. It is hugely over-rated. But, like most energy sources, it has its place. To dismiss it or condemn it out-of-hand is as distorted a view as to hail it as the solution to all our energy problems.

The Times today printed a damning article on an urban wind installation. A turbine installed four weeks ago at the home of Mr John Large, it reports, "has so far generated four kilowatts of electricity", compared to an average household's consumption of "23kw every day", and offering a return of "9p a week" compared to the £13,000 that Mr Large spent on the installation.

As many were quick to point out in comments on the article at The Times's website, and on many blogs, the journalist's ignorance of basic energy and engineering was revealed by his use of terminology. Kilowatts (or kW - lower-case k, upper-case W) are a measure of potential - the capability to deliver a given amount of energy in a given time if working at full load. Kilowatt-hours (kWh - as above, plus lower-case h) are a measure of energy - specifically the amount of energy produced if an engine with the potential to produce 1 kW is run at full load continuously for one hour. The phrase "has so far generated four kilowatts" is therefore a nonsense - kW contain no notion of time, so one cannot say that any number of kW have been generated "so far".

"23kw every day" is likewise wrong, not only in the spelling, but also in fact - to the extent that averages are in any way meaningful (which is a very limited extent), the figure should be 23 kWh, not 23 kW. 23 kW every day would, according to the best interpretation one could put on it (23 kW of demand continuously for 24 hours) equate to 552 kWh per day, which is way over the top. As it is, even 23 kWh per day is excessive - total domestic consumption of electricity in the UK is around 115 TWh (1 TWh = 1 billion kWh) each year, which is equivalent to around 4,800 kWh per household annually (there are just over 24 million households in the UK), or 13 kWh per household per day.