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“A majority of Americans want companies to stay out of politics. They want to have a separate space for where they shop, where they work, and where they invest from the places where they cast their ballots or engage in their political debates.” – Vivek Ramaswamy, a young businessman and author of Woke Inc. He is critical of the current trend of firms, and asset managers such as BlackRock, seemingly putting non-financial goals before those to do with actually earning a return for investors. May 11th, 2022 | 26 comments - (Comments are closed)
As a supplement to Johnathan’s post. A couple of points:
Update 10/5/22. As Douglas2 points out this is a graph for the US. Ugh. Luckily TomJ has found a graph for the UK which looks like this:
This is very similar so long as you are aware that the blue line has been moved 18 months to the right. It also suggests that this bout of inflation is likely to be short-lived. May 9th, 2022 | 8 comments - (Comments are closed)
“If you decided to stop working for the better part of two years, and to maintain your income solely through borrowing, you’d end up worse off. Almost everyone understands that on a personal level. But we struggle to extend the logic to the nation. During the lockdowns, the Government paid people not to produce things, and funded the difference by printing money. A decline in the production of real-world goods and services, combined with an increase in the number of pounds and pence in circulation, would mean inflation even without the Ukrainian conflict. Yet commentators and MPs who opposed every loosening of restrictions (including Starmer) now talk about the cost of living crisis as if it were some wanton act of ministerial sadism.” – Daniel Hannan, Sunday Telegraph (£) The problem in my view is that on economics, or indeed on certain other topics where people need to understand cause and effect, the education system in this country, and indeed much of our culture, is against an understanding of cause/effect beyond the concrete experiences of daily life. People seem unable to think in terms of concepts. The question is whether there are sufficient people to point these links out between rising prices, poverty, and a policy of “work for nothing” paid for by printing money. Much hinges on making the case. May 9th, 2022 | 7 comments - (Comments are closed)
The author of this Reuters article on the German jobs market plainly hasn’t heard of Linkedin, or jobs advertising, or even old-style labour exchanges where people can go to find out where vacancies are and retrain. Time for a good old fisking:
There is nothing wrong with firms exchanging ideas with one another to fix an issue. (Although ironically, government “anti-trust” laws might work against that.) It is worth noting, of course, that losses of jobs in areas such as petrol-driven cars are partly caused by government policy itself, such as the Net Zero decarbonization efforts that, depending on your point of view, are necessary or barking insane.
Right.
Does it? I mean, I assume German firms want to pursue a profit. They’re not charities.
Again, this seems like rational self-interest to me. There’s no objection I see to firms liaising with one another, and forming pacts about dealing with the need for skilled people. The key is that the State keeps its nose out of it. Also, if firms try and steer staff who might lose a job to another firm, that needs to be weighed against whether and how the employee might want their lives to go. The tone of the article seems to be that what is needed is a sort of hand-holding paternalism, but that creates a vicious circle where employees lose the desire to manage their working careers in a proactive way.
Forcing an entire industry to abandon a reliable, effective technology used for a century and switch to an arguably less reliable, and more costly one. Yep, there are going to be consequences. It also doesn’t help that German government policy in the past 20 years on energy has been almost calculated to harm its manufacturing base in the long run.
Good news, so long as the jobs are financially viable. Ariane Reinhart, board member responsible for human resources (HR) at Continental and chief spokesperson of the [jobs] business-led initiative, was quoted as saying: “Leaving it to the free market is not enough – it would not be what’s best for workers, or the economy.” Wrong. For a start, none of the ideas about firms collaborating to move workers with desired skills around could not happen in a free market without state interference. Employers (I am one) know that finding talented staff is one of the most important issues there is, and in an open economy, there are all kinds of ways people with skills in demand can find jobs. Further, it is hardly a mystery to employees that they should keep on top of new skills to make themselves more desirable and increase what they earn. That’s the “free market”. The author of this article might want to reflect that it was the free market economy, and not some sort of top-down socialism, that helped propel West Germany after 1945 into being one of the richest economies on earth. By 1960 or thereabouts, that country had matched the UK in terms output per head. To repeat an important point: there is no reason why firms could not and would not collaborate, if their self-interest coincided, in figuring out how people with desirable skills could be moved from place to place. What the author of this article cannot or will not address is whether firms in the article are not just doing what they might do anyway? Why did this question not get asked? Why just accept, at face value, that this sort of collaboration is some wonderful example of a less market-based system? After all, I can log on to the internet and find jobs, homes, flights, hotels, courses for training in new skills, etc, without anyone from government or some official entity holding my hand. Amazing, isn’t it, this “free market” of ours. April 22nd, 2022 | 8 comments - (Comments are closed)
April 2021: “Sri Lanka will become first country to be free of chemical fertilizer”, the Sri Lankan news website News First reported:
April 2022: “How Sri Lanka’s shift to organic farming left it in the manure,” reports the Times:
[…]
April 17th, 2022 | 18 comments - (Comments are closed)
A lot of people in the media are calling it the “cost of living crisis” but us lot who were around in the 1970s know it as “inflation”. Back then – if the government’s figures are/were to be believed – it peaked at 25%. The 1970s were a pretty horrible decade all round. As well as inflation, there were constant strikes, bankrupt nationalised industries and a general air of doom. A Samizdata contributor, growing up in France even had an economics text book with a chapter entitled, “Britain: headed for the Third World?” Since the mid-1980s inflation has been much lower. It’s been present but until now it has been far less of a day-to-day problem. So, what happened? The Thatcher government put up interest rates. For reasons that I may have once understood, but no longer do, this reduced inflation. But it came at a price. Huge numbers of businesses went bust or reduced their workforces. Unemployment skyrocketed. By the mid-1980s growth had returned but many previously industrialised areas did not recover and still haven’t. I doubt they ever will. Are there lessons in this? Harbingers more like. Interest rates have been very low for a very long time. Homeowners – as opposed to businesses last time round – have borrowed a lot. If you are on an average income and want to own your own house and bring up a family that is what you have to do. Should interest rates go up, millions will find they cannot pay their mortgages. A cynic might argue that at least in the 1980s, the pain was borne by people who weren’t going to vote Conservative anyway. This time, that’s not so clear. Update 16/4/22. I see from the comments that a lot of people in the US have fixed rate mortgages. Very sensible. I wonder if that is the case here in the UK? Also, how easy is for banks to call a loan in? It occurs to me that lots of people with fixed-rate mortgages might not be all that good a get-out-of-jail-free card. If interest rates do go up that would severely depress house prices. Sure, homeowners would still be able to pay off their mortgages but their properties would be worth a lot less. Homeowners of course are not the only borrowers. A few years ago – when I was into this sort of thing – I came across a couple of reasonably-large, barely-profitable companies with large amounts of debt that periodically needed to be refinanced. If interest rates go up they would be in a lot of trouble. I wonder how prevalent this is? April 15th, 2022 | 22 comments - (Comments are closed)
“As long as life sustenance remains the ultimate goal of individuals, they are likely to assign a higher valuation to present goods versus the future goods and no central bank interest rate manipulation is likely to change this. Any attempt by central bank policy makers to overrule this fact is going to undermine the process of wealth formation and lower individual’s living standards. It is not going to help economic growth if the central bank artificially lowers interest rates whilst individuals did not allocate an adequate amount of savings to support the expansion of capital goods investments. It is not possible to replace savings with more money and the artificial lowering of the interest rate. It is not possible to generate something out of nothing. Likewise, by raising interest rates the central bank cannot undo the damage from the previous easy interest rate stance.” – Dr Frank Shostak, writing at the Cobden Centre website. (Thanks to Paul Marks for the pointer.) April 5th, 2022 | 10 comments - (Comments are closed)
“UK supermarkets accused of ‘bombarding’ shoppers with cheap meat”, whispers the Guardian’s Denis Campbell in shock:
Marketing directors of Tesco, Sainsbury’s, Asda and Morrisons? Apparently not. This disturbing news comes from the…
March 26th, 2022 | 25 comments - (Comments are closed)
I have considerable respect for the Guardian‘s John Harris. Though a Remainer himself, he was one of the first left-wing journalists to see that the campaign to leave the European Union had popular support, particularly among the working class, and the reason he could see that while others could not was because he and his colleague John Domokos did what others did not and put in the legwork to report from “Anywhere But Westminster”. But respect does not mean agreement. Mr Harris writes that “Nigel Farage’s hard-right faction won Brexit. Now net zero is in its sights” like that’s a bad thing. March 14th, 2022 | 28 comments - (Comments are closed)
This description of Russia’s economy grows into an interesting analysis of how power and economic reality interact. Some bits may strike you as not so very unlike Biden’s US.
Other parts, however, give examples of how economic activity in places like Russia and Mexico is determined by things that we in the anglosphere are not too familiar with (yet!).
Having asked the question, he goes on to provide answers. March 10th, 2022 | 23 comments - (Comments are closed)
The West’s Green delusions empowered Putin. While we banned plastic straws, Russia drilled and doubled nuclear energy production. March 2nd, 2022 | 9 comments - (Comments are closed)
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