Time-travelling economics

BBC journalists were reporting last night that Gordon Brown, who is apparently an avid student of history, was explaining how it was important to reach agreement at the G20 on a broad, fiscal stimulus, or it would be like 1933, when failure by the governments to reach agreement led to the Great Depression.

This seems somewhat inconsistent with the line that we have seen repeated by many journalists, particularly in the BBC, that recovery began in 1932, with the introduction of the New Deal.

So we started recovering in 1932 from a Depression that began in 1933, did we? Do the Brownite/Keynesian crowd have no shame in their manipulation of history?

And where is the BBC's coverage of Dan Hannan's speech to Gordon at the European Parliament, which is currently the most-viewed video globally on YouTube? Fox News have covered it, but our media...

Capitalist pigs of the media

Tim Worstall picked up yesterday on George Monbiot's rant against "neo-liberalism" and its promoters in the Mont Pèlerin Society and elsewhere. George names a large number of participants in the global conspiracy to promote the view "that we are best served by maximum market freedom and minimum intervention by the state", but

"the most powerful promoter of this programme was the media. Most of it is owned by multimillionaires who use it to project the ideas that support their interests. Those ideas which threaten their interests are either ignored or ridiculed. It is through the newspapers and TV channels that the socially destructive notions of a small group of extremists have come to look like common sense."

Which publication could be more representative of this global capitalist conspiracy in the media than the Financial Times? So it was interesting to see the stories they covered that same day, and the angles they took on those stories:

  • "One-third of biggest businesses pays no tax". The fact that many of our largest companies pay no tax suggests that there is something inequitable in our corporation-tax regime. Interesting way to promote the virtues of capitalism.
  • "'Hundreds of millions' in failed debt for Barclays". One of our leading capitalist institutions has been incompetent in its management of our money, and is implicated in the larger losses suffered by Sachsen LB, an East-German state bank.
  • "Sarkozy pushes to widen EU's global role as a policy 'priority'". Promoting the virtues of the super-state.
  • "Cutting red tape 'could weaken HSE'". The unions tell us how important it is for the Government to wrap everyone in cotton-wool and rules.
  • "Shoppers to pay as demand rises for milk powder". Oh look, we've found another area where the capitalist system doesn't seem to be delivering benefits to the people.
  • "Earnings gap adds to welfare state's hard task". Yet another piece of effectively socialist research from the LSE given plenty of attention by our capitalist cheerleaders.
  • "EU referendum calls are misguided" (Leader). The Contitutional Reform Treaty is a "tidying-up exercise" necessary to ensure that we do not have a "do-nothing Union", and the "motley band" calling for the Government to honour its pledge to hold a referendum are "misguided" and acting against "the national interest". That'll be more big government on the capitalists' wishlist, then.
  • "The Republicans' jockeying on terrorism is terrifying". Coupled with an earlier story on "Democrat victory as another Bush ally steps down", this wasn't exactly shoring up the morale and credibility of one of the supposedly leading forces for unfettered capitalism.
  • "Exeunt private equity's prima donnas". Schadenfreude at the comeuppance being experienced by some of our most excessive and irresponsible capitalists.
  • "'How I did it' books give me a sinking feeling". We have nothing to learn from some of the world's leading entrepreneurs, who turn out to be semi-literate fools, judged by their writings.
  • "The cost of hidden bias at work". Even managers of our capitalist institutions can be victims of its rampant aggression and inequity.

I'd say George has nothing to worry about. When the media's supposed high representative of free markets is loaded down with this much material critical of markets or supportive of big government, it's those of us who believe in freedom that need to worry, not twats like Monbiot who think they know what's best for us. Which leftward slant amongst even our supposed market advocates is not very different to the intellectual climate after the war, which led Hayek, Friedman and co to judge that they needed to found a society to preserve the idea of freedom and to discuss how to promote it. Plus ça change.

Mark Thompson puts the case for carving up the BBC...

Indirectly, not intentionally, of course.

Mark Thompson today justified the BBC's licence fee on the basis that (in the words of the FT) "the quality of commercial broadcasters' news, current affairs and comedy output is declining". I agree (at least, that it isn't getting better). In fact, I have been saying that there is a case for supporting the BBC's news, current affairs, and innovative comedy for years.

But that could be achieved by funding BBC2, Radio 4, and the World Service, "tasked with the undemocratic job of producing high-quality, diverse, educational, public-service broadcasting", as I put it two years ago. At a fraction of the cost of the BBC's current £3bn.

You will notice that Mr Thompson did not try to make the same argument for soap operas and light entertainment. He did not say that commercial broadcasters are providing insufficient quality and choice in music radio and TV. He did not pretend that there is a shortage of sports (and particularly football) coverage in commercial circles. Because even a BBC executive would not have the balls to go out in public and try to make such a blatantly untrue argument.

It seems, then, that Mr Thompson has conceded the point, and that we can move on to discussing the details of the breakup. When even the Director-General of the BBC can see that 80% of its output is not justified by providing a necessary alternative to commercial services, it is time to discuss how, not whether, we are going to move that output properly into the commercial sector.

Rosie Boycott: Labour have made a hash of things

Rosie Boycott has just said on This Week that "in 1997 we were elated but actually we didn't have that many great big problems. And there are a lot of big problems: there is the war, there is the environment, there is the huge gap between the rich and the poor, you know we've had nine murders of young men in recent weeks, we've had gun crime, we've had all sorts of things that are awful." In anyone else's mouth, this would mean that the Tories left things in a pretty good state in 1997 and Labour have made a hash of things since then.

The BBC's idea of business

The BBC ran a half-hour promotion on Thursday night for government-funded investment in businesses or technologies that government judged to be promising. In other words, a promotion for picking losers (the policy, not the site, sadly). I'm sure the institutionally-biased BBC didn't think that was what they were doing, but that's what it was.

That advert was masquerading as one of their business programmes - Radio 4's In Business - which ought to be the last place that one would find such a concept promoted. But this isn't real business, this is the BBC's idea of business. Perhaps it is unreasonable to expect a commercial perspective from a state-funded organization, and from a business reporter (Peter Day) whose background is an English degree, four years with a Glasgow newspaper, and then a lifetime of service with the BBC. This guy has barely been close to a commercial organization or a set of accounts, let alone tried to run a business in a world of government-funded competition.

You can download an MP3 of the programme here (careful, it's a 12MB file). Those of a rational disposition may want to ensure that they have a punchbag (a BBC employee would be ideal) to hand before starting playback, to avoid stress-related injury due to excessive internalization of anger.

There was nothing wrong with looking at the issue of picking losers. But even the most Trotskyite of BBC producers [Tautology - Ed] might have to admit that there are two sides to this story. There was an almost complete failure to examine the arguments against, and plenty of commentary that said to the listener, in effect, "of course government should be picking losers". Let's look in detail at how the programme went about this issue.

Who guards the guards?

JG pointed out Boris Johnson's comments on Blair's speech about the modern media. It deserves a post of its own.

Boris wants to characterize Blair's comments as being mainly about the media's treatment of him. If you read Blair's speech, very little of it was about his treatment at the hands of the media. And he acknowledged his complicity.

Boris must be assuming that most people will not bother to read Blair's actual words, and will instead rely on what they hear about it through the media. Would that be the same "media-literate" public who he claims "can almost always see behind the hysteria and the hyperbole, and work out what is really going on", who "find it relatively easy to blow the froth off a story and get to the nub"? Would you like any cream with your disingenuity, Boris?

Misrepresenting Blair's argument is not enough. He must also recast the media as poor, set-upon creatures, deserving of our sympathy, as they struggle in the glare of the public spotlight against the harsh criticisms of the blogosphere. A mistake, that. It is so over-egged that most readers, however credulous, will smell a rat. A "new and terrifying threat"? "Hordes of lynx-eyed brainboxes out there in cyberspace"? Journalists "increasingly accountable, increasingly vulnerable to the pithy rejoinders of the man or woman on the net"?

I don't know if this counts to you as a pithy rejoinder, Boris. But let's see what difference it makes. Are you feeling threatened? Are you taking account? Do you think this post will make the slightest difference to your journalistic career? You, and most of your readers, probably won't even know it exists. You wrote your piece because you knew you could get away with it, not because you feared that you couldn't.

Blair is right too

First Bush. Now Blair. What is happening to the world?

Actually, the feigned surprise could be considered disingenuous. This author does not generally perceive politicians as knaves or fools. Mostly, they are decent and intelligent people trying to do what they think is best. Of course there is sometimes corruption and incompetence, but most of the many failings of government can be attributed not to individual failings but to the intellectual climate, both in shaping politicians' false conceptions of appropriate ends and means, and (perhaps more importantly) in shaping the public perceptions that they have to satisfy. What is surprising is not that these people have shown their intelligence, but that they have used that intelligence to reach unpopular and unconventional conclusions, and moreover that they have felt able to go public with them. What a pity that politicians with the freedom of not seeking re-election are not reported more often.

(It is this, by the way, and not whether you agree with what he did, that makes Blair's valedictory excuse - "I did what I thought was right" - so feeble and irrelevant. It is outcomes and not intentions that count.)

Anyway, what Mr Blair is right about is a decent chunk of his analysis of the role and behaviour of the modern media. Not in the regulatory solution at which (as so often) he hints. But in his assessment that there is a problem.

The media have said sayonara to subtlety, dispensed with detail, kissed goodbye to considered analysis. Everything must be immediate and black-and-white. In echoes of Hollywood, there must be "good guys" and "bad guys", a very simple plot, and two-dimensional characterization.

Impartiality of state employees

There was some accidentally revealing stuff today on Radio 5Live's reporting of Tony Blair's resignation and their review of his premiership. First Jane Garvey reported that the halls of Corporation House were awash with empty champagne bottles the morning after the 1997 election. Realising that this gave the lie to the BBC's supposed impartiality, she whittered briefly on the subject of whether this really indicated preference for Labour, before eventually saying that she wished she'd never brought it up. Oops.

BBC sceptics

The BBC is in many ways excellent (when you compare the quality of TV and radio in other countries, for example), but is nevertheless a persistent irritant with occasional outbreaks of festering sores. The priority given to football over everything else on Radio FiveLive is a long-term annoyance, as is the English bias of a supposedly British broadcaster (e.g. regularly giving preference to second-grade domestic English football games over Scottish, Welsh or Irish internationals of various sports). Their blatant and boring pursuit of a vendetta on Iraq is another persistent scab, particularly when their talking-up of opposition puts the lives of our troops in greater danger than need be, and drives the country towards more rather than less violence. Their liberal (in the American sense) bias, exposed by Robin Aitken and acknowledged by more independent-minded BBC journalists such as Jeff Randall, Andrew Marr and Jeremy Paxman, is perhaps the most egregious example of the problem that Hayek identified in The Intellectuals and Socialism.

My answer is that BBC1, Radios 1, 2, 3 and 5 and the various digital services should be privatised, leaving Radio 4, BBC2 and the World Service to produce high-quality programming that would not be provided by the market. All the talk of providing what the viewers want and giving them value for their licence-fee is hogwash. The market should provide what people want. If the government is going to tax us to provide something, it should only be for things we need but which will not be provided for by the market. It is quite clear from the various competing television and radio channels that the market can and does provide what BBC1, and Radios 1-3 & 5 offer - often better than they do. The BBC has to decide whether it is a commercial organisation pursuing ratings, in which case it should not be tax-funded, or a public service, in which case it should not pander to the lowest common denominator in the search for ratings. At the moment, they want to have their cake and eat it.

I admit this plan would not remove the bias, but it would dramatically reduce the amount we have to pay to support it. It would retain some of the pockets of individualism, such as can be found in the Newsnight team, to balance a reduced liberal majority. And it would expose most of those who are happy spoon-feeding the public with their sloppy metropolitan chatter to the reality of having to provide the public with what they actually want, rather than what the presenters want to give them.

The latest example of their unconscious bias was yesterday's reporting of the Budget debate on Radio FiveLive. Having suffered a recurrence of my chronic irritation, I was looking for fellow sufferers with whom to share sympathy, and came across a couple of excellent blogs that I have added to our blogroll. Biased BBC is the definitive site for recording examples of dripping-wet, state-funded reporting. Some Stuff is a newish blog with a wider interest than just the BBC or the media, but Ralph clearly shares my irritation with their partial reporting. I recommend them both to you.

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.

Labour spend more on advertising than Tesco and M&S combined!

Supermarket giant Tesco and revitalised high-street giant Marks & Spencer spent £67m and £66m on advertising last year respectively. If you combine their advertising budgets you are still a way off matching the amount of money this government has wasted in its own self-publication advertising in the past twelve months. They have managed to burn up £137m television adverts, radio stations, billboards, newspapers, cinemas and other outlets. What an incredible waste of money!  When they are not telling us how to live our lives, they are misusing public money to further the Labour party’s agenda and self-interest. It is not how the electorate expect their money to be spent and yet they appear to be getting away with it. Our taxes are not meant to be spent on publicising the Labour party nor drumming home relentlessly on how we should live our lives. Stop wasting our money and stop nannying us.

Government alchemy - Independent-style

The Independent is never shy of calling for more government money to be spent on one thing or another. Now we know why. Apparently taxation is not a drain on the economy, but a means to create wealth.

They report today that the Department for Transport estimate that "road pricing could raise up to £28bn by 2025". Let's not worry about how they can so precisely calculate a figure so far in the future, or whether they took the costs of the scheme into account. It's rubbish, of course, but we'll leave that for another post some other time.

What I am interested in here is what we can learn about the understanding of at least one leading journalist at The Independent about how the economy works. Because, in their box-out "The case for (and against) charging" (the brackets nicely illustrate the "balance" that they bring to this argument), they report that road pricing would "benefit the economy by £28bn".

Silly me. There was I thinking that we need to keep taxes under control because they represent a drag on the productive part of the economy, when all along I should have been pushing for ever-higher taxes, because the government can apparently magically double the value of money in the hands of taxpayers, simply by taking it off them.

Next time you read analysis in The Independent making a moralistic (and usually simplistic) case for more spending on this or that, remember that, in their eyes, they'll not only be improving the lot of those on whom the money is being spent, but expanding the economy as well. Then put the paper down, and buy one written by economic literates.


BBC censorship

While I'm posting on the subject of the BBC, let me show you a great example of their intolerance of dissent.

In August 2005, I posted on the FiveLive message boards a message complaining that they were covering Championship football when the second Ashes Test was coming to a tense conclusion. They moderated it away. I exchanged correspondence with them, and it was subsequently restored. Below is a copy of the email exchanges. The link to their messageboard archives still works if you want to view the thread. I will post each message as a reply, as the web-host seems to have trouble accepting this all in one go.

Dominance of the "majority"

Yet again, it only took a few minutes of driving yesterday to be infuriated by the radio. 5Live was doing football. TalkSport was doing football. The regional channels were doing football. Radio 4 was doing…. drama.

It is early August. The second Ashes Test is coming to a tense conclusion. Britain’s athletes are competing (mostly unsuccessfully) in the World Athletics Chamionships. The Premiership (football) hasn’t started yet. Why must we have wall-to-wall football? The previous football season only ended in May. And we haven’t even had a break during our two months off - what with transfer gossip and reporting from the various warm-up matches and tournaments that our teams compete in during the “off-season”.

BBC Charter Renewal

Driving back from picking up my car this afternoon, I turned on the radio, more in hope than expectation. I do not listen to the music channels (the channels that play current music lost their attraction when I reached the age of thirty, and if I’m going to listen to oldies, I’d rather listen to my own selection than someone else’s). So I have a grand total of three analogue channels to which I can listen: Talk Sport and BBC channels 4 and 5-Live. My expectations were low from bitter experience. And sure enough, I experienced that small thrill of pleasure that comes from having one’s worst expectations confirmed, followed by the more sustained depression of realising that yet again there was no intelligent discussion going on anywhere in British radio.