Browse > Home / Archive by category 'Economics'

| Subcribe via RSS

Tackling poverty: free our markets

By Alex Chatham
June 23rd, 2017 at 8:46 am | Comments Off on Tackling poverty: free our markets | Posted in Economics, Free trade, freedom

Pundits have had a field-day speculating as to why Jeremy Corbyn’s Labour party increased its hare of votes and seats at the General Election. It could simply be that at this stage of the electoral cycle, voters were feeling fed up with the incumbent. But the narrative developing is that the public are looking for solutions and the Conservative party is failing to offer them. It is true, that the policies proposed to help those ‘just about managing’ didn’t hit the mark. Ask someone if they would like to see a worker on a board of directors or more money for the NHS and the answer is obvious.

Both main parties talked up State intervention and talked down the power of the free market. It appeared that the Conservatives were ashamed of capitalism and decided to put it in the attic so no one would notice it. Since the election, Allister Heath of the Telegraph and others have called for a new or existing think tank to make the case for the market.

That case is very strong. Apart from anything else, markets work. In a free market people voluntarily engage with each other, find jobs, goods and services that they want. The market allows people to collectivley send messages to producers about what they want and what they can afford. The producers respond. Of course, not everyone can get what they want but as a collectivist endeavour, the market beats command and control every time. Perhaps more importantly than that free markets lift people out of poverty because a functioning market creates wealth and successful businesses. Those businesses employ people. It is astonishing that the Left, claiming to care so much about the poor, dismiss markets and want to shackle them, which in turn causes poverty.

As well as making the case for free markets, and free trade as the only fair trade is free trade, there needs to be a campaign to ensure that markets are as free as possible. That means removing regulation and reducing government interference.


Crying Over Milk

By Editor
August 8th, 2015 at 11:50 am | Comments Off on Crying Over Milk | Posted in Economics

A reminder that this year’s milk price crisis is principally the result of the ending of previous market rigging. Harsh as it is on the dairy farmers, there are simply too many of them producing too much milk, too expensively, in relation to demand for milk from consumers. They are not inefficient, or at least most are not. There are just too many.

A ‘consumer’ campaign to raise prices, in that regard, is pointless. The idea behind it is that retailers, their margins protected would then pay local farmers more. That is unlikely other than on premium speciality products that already command higher prices. Principally retailers would just enjoy higher profits. Competition for the provision of milk from across the EU would remain unchanged.

There’s no reason to think that combatting that with a ‘buy British’ or ‘save our farmers’ campaign would be any more successful for milk than any of the other attempts for similar products. Do you care if the cod in your fish finger was caught by a British trawler?

It could additionally turn nasty with retailers and importers being bullied, a tactic familiar to the agricultural sector in France. Some of the MP and candidate tactics clearing shelves in shops at the moment, are some distance from les moutons enflammé. But the principle is the same, to intimidate free trade into submission. Bugger the customers. It is largely criminal and nasty producer racketeering, not a glorious expression of public concern.

What has to happen, and is going to happen, is that a large number of dairy farms need to close or consolidate. That is going to be very brutal and unpleasant for the failed businesses, but it is no kindness to pretend otherwise with ‘look at me I’m campaigning’ faux-empathy.

Nor is it any worse for farmers than any other changing industry. Bar the exception that European Governments, including our own, have made the transition more jarring than it needed to be by rigging the market for so long. Something familiar to former miners, dockers, and soon postal workers. Thanks politicians… good job.

Politicians today then might then consider more emphasis on the transition support for those leaving the market. And a little less histrionic poujadism, which will leave those who will need to get out far less ready to change. Beware of politicians bearing campaigns. They are not always your friends.

Public policy failure

By Alex Chatham
June 19th, 2015 at 2:30 pm | Comments Off on Public policy failure | Posted in Economics, Public Sector Reform

Lord Bob Kerslake, the author of a report in housing in London, has said that the failure to build enough homes “has been the biggest public policy failure of the past 50 years”. It is refreshing to hear someone admit that public policy can fail. Normally, commentators and policymakers talk about market failure. This is normally a cue to proposal State intervention. Lord Kerslake appears to be thinking along these lines, which is a shame. It would be better to admit that public policy has failed and that it is time to let the market function properly.


The Uber free market

By Alex Chatham
May 28th, 2015 at 2:30 pm | Comments Off on The Uber free market | Posted in Conservatives, Economics, freedom, Nannying

For some in the Conservative party, Boris Johnson is the libertarian saviour waiting in the wings to take power and reshape Britain. After all, the London Mayor recently told licenced Black Cab drivers that they had to accept the success of Uber because that is how a free market works. Liberals should applaud this championing of the market. For those who don’t much like markets, remember people collectively send price signals that tells suppliers what is and isn’t wanted.

Odd then that the same Boris Johnson has decided to put a cap on how many mini cabs operate in London. He has decided, no doubt based on expert advice, that we have too many. It might be worth reminding Boris that this is a free market and it is the people who should decide how many cabs offer their services to Londoners.


Barlow Is Not To Blame!

By Sara Scarlett
May 13th, 2014 at 11:35 am | Comments Off on Barlow Is Not To Blame! | Posted in Economics, Tax, UK Politics

I can’t quite get my head around the outrage over the Gary Barlow tax avoidance (note: not tax evasion) story. Margaret Hodge MP has actually suggested that he should give back his OBE! What a joke!

Let us be under no illusions. Loopholes exist because politicians put them there. Holes in the tax code are created by politicians and politicians alone. Politicians are fully responsible for them and could get rid of them if they wanted to.

For politicians to heap all the blame on Barlow is incredulous. The thing about loopholes is this: why would anyone pay more tax than the tax code says they are legally obliged to? Shouldn’t we be more outraged by the politicians who have been poking holes in the tax code for years? The more complex and convoluted the tax code becomes the more it becomes a Swiss Cheese that is easy for the rich to navigate – they can afford expensive accountants – but a nightmare for individuals and small companies.

The outrage directed at Barlow is a very sad thing because it is a distraction from a proper discussion about tax code reform and the people who are responsible for the disastrous state the tax code is in.