breaking news from the world of ideas

by Peter Franklin
Wednesday, 16
October 2019
Reaction
18:53

There is nothing wrong with neoliberalism… as a word

A tweet from Ezra Klein, co-founder of Vox Media:

No, sir, it would not. ‘Neoliberalism’ is not the loveliest of words, but it is a useful one — referring to a particular era of capitalism, i.e. the one we’re living through now.

One can debate precise definitions, but neoliberalism is what replaced the post-war model of capitalism — in which government was heavily involved in the productive side of the economy. In the 1980s and 90s, a wave of privatisation and deregulation rolled back the frontiers of the state — but not all the way. The welfare state, despite some reforms, stayed very much in place. ...  Continue reading

by Peter Franklin
Tuesday, 15
October 2019
Idea
12:45

Late Capitalism? Don’t you believe it.

Late capitalism? Don’t you believe it. A timely blogpost from Branko Milanovic reminds us that the capitalist system, love it or hate it, is far from on its way out:

Geographically, capitalism is now the dominant (or even the only) mode of production all over the world whether in Sweden where the private sector employs more than 70% of the labour force, the United States where it employs 85% or in China where the (capitalistically-organized) private sector produces 80% of the value added.

This was obviously not the case before the fall of communism in Eastern Europe and Russia, nor before China embarked on what is euphemistically called ‘transformation’ but was in reality replacement of socialism by capitalist relations of productions.

- Branko Milanovic

Furthermore, he says, capitalism (especially the tech sector) is creating new markets (and thus turning non-capital into capital) all the time – “a huge market for personal data, rental markets for own cars and homes… market for housing of self-employed individuals.” ...  Continue reading

by Peter Franklin
Thursday, 10
October 2019
Explainer
17:36

Why would anyone buy a negative yield bond?

In August, I wrote about negative yield bonds. A bond is a tradable IOU – in which the issuer (typically a government or a big business) promises to repay a specified amount (basically the bond purchase price) at a specified point in the future plus a bit extra – i.e. the interest on the loan, which is also referred to as the coupon or the yield. Bonds, therefore, are a means by which governments and other organisations can borrow from the money markets.

A negative yield bond is a strange beast that promises to repay the holder less than the original purchase price. It is therefore an investment guaranteed to lose you money. Nevertheless, governments have been selling these by the bucket load. At one point over the summer the money markets had $17 trillion invested in these seemingly unattractive pieces of paper. ...  Continue reading

by Peter Franklin
Thursday, 10
October 2019
Seen Elsewhere
11:25

Tax evading billionaires will put Warren in the White House

Well, it’s finally happened – America now has a regressive tax system in which the 400 richest families pay a lower effective rate than the poorest 50% of Americans.

That’s according to Christopher Ingraham in the Washington Post, who reports on the latest research into what different income groups actually pay in terms of all taxes, not just income tax :

The Triumph of Injustice, by economists Emmanuel Saez and Gabriel Zucman of the University of California at Berkeley, presents a first-of-its-kind analysis of Americans’ effective tax rates since the 1960s. It finds that in 2018 the average effective tax rate paid by the richest 400 families in the country was 23 percent, a full percentage point lower than the 24.2 percent rate paid by the bottom half of American households.
- Christopher Ingraham

The following graph shows that the super-rich used to pay a lot more but that the gap has now not only disappeared but gone negative for the first time:

Presidential contender Elizabeth Warren has a plan to put that right. This is her “Ultra Millionaire Tax“, which happens to quote the economists who produced the above research: ...  Continue reading

by Peter Franklin
Tuesday, 8
October 2019
Idea
18:30

Are socialists liberal? A response to Maajid Nawaz

A thought provoking tweet from Maajid Nawaz:

While this used to be true, I’m not sure it is anymore – in fact I’d argue that most of the contemporary Left, including the self-declared socialist component, is liberal though-and-through.

Classical socialism – whether of the democratic Old Labour variety or the totalitarian Soviet kind – really was about collectivism and group identity, especially class identity. It did not prioritise the maximisation of individual liberty – and, in many cases, sought to minimise it. It was therefore non-liberal or downright anti-liberal. ...  Continue reading

by Peter Franklin
Monday, 7
October 2019
Seen Elsewhere
18:28

Why does everyone hate inheritance tax?

In the New Statesman, George Eaton examines an enduring paradox:

…though inheritance tax is paid by just 5 per cent of UK estates, it remains the most reviled tax of all (a 2015 YouGov poll found that 59 per cent of people regard it as ‘unfair’).
- George Eaton

It doesn’t affect most people, so why the widespread hostility?

It’s a phenomenon that doesn’t just drive the Left round the bend, but a lot of liberals and quite a few free-marketeers too. Wouldn’t it be more efficient to tax unearned wealth rather than earned income? Why should people inherit things they’ve never had to work for? Isn’t taxing people post-mortem the least painful way?

The case for inheritance tax is a supremely rational one – but that’s precisely the problem. By-and-large people don’t see themselves as autonomous work units to be optimised for maximum productivity. Rather, most of us see ourselves as part of a family – whose possessions aren’t mere ‘assets’, but homes and the objects that help make a home. ...  Continue reading

by Peter Franklin
Friday, 4
October 2019
Idea
07:03

Fake blood won’t do it: the climate change movement needs to lead by example

It must have seemed like a good idea at the time. The issue was British Government backing for fossil fuel projects around the world – in support of UK exports, but grossly inconsistent with the fight against climate change. How to draw attention to this outrage?

A group of Extinction Rebellion protestors hatched a cunning plan: get hold of a fire engine, load it up with 1,800 litres of fake blood and spray it all over the front of the Treasury building. All went well until they lost control of the fire hose, which spat and thrashed about like a mad snake, leaving the protesters literally red faced. Oops. ...  Continue reading

by Peter Franklin
Thursday, 3
October 2019
Idea
08:07

Why do some people find more purpose in life than others?

In June, UnHerd ran a series of articles called Riven Britain, which looked beyond disparities of income to look at the other inequalities that divide us. For instance inequalities of accumulated wealth, wellbeing and the beauty of one’s surroundings. We also looked at geographical inequality and the profoundly unequal way in which people with learning disabilities are treated.

One inequality we didn’t mention, however, was what one might call existential inequality – between those who believe their lives have meaning and purpose and those who don’t.

A YouGov survey commissioned for a report by the libertarian Cato Institute reveals significant existential inequalities between Americans. ...  Continue reading

by Peter Franklin
Tuesday, 1
October 2019
Seen Elsewhere
08:12

One step forward, one step back in the battle for beauty

“Communities will get the legal right to fight ugly buildings and poorly designed new homes in their towns and villages” we learn from The Telegraph.

the Nansledan housing development

Just what this “right to fight ugliness” adds up to will become clearer when the Ministry of Housing, Communities and Local Government (MHCLG) publishes the “first ever guide to set out the Government’s minimum design requirements for new homes.”

But it looks like Sir Roger Scruton and Nicholas Boys Smith, the co-chairs of the Building Better, Building Beautiful Commission are being listened to.

On the other hand, there’s also news, via Jason Groves of the Daily Mail, that “families will be able to add two storeys to their homes without planning permission… Homeowners will still need to comply with building regulations, but neighbours will not have a formal route to object.” ...  Continue reading

by Peter Franklin
Thursday, 26
September 2019
Seen Elsewhere
12:45

Greta Thunberg, post-liberal prophet

Amid the continuing tumult of Greta-mania and Greta-phobia, Jeff MacMahon of Forbes has noticed something in Thunberg’s words to the US Congress that everyone else has missed. Here’s the relevant passage:

Wherever I go I seem to be surrounded by fairytales. Business leaders, elected officials all across the political spectrum spending their time making up and telling bedtime stories that soothe us, that make us go back to sleep. These are ‘feel-good’ stories about how we are going to fix everything. How wonderful everything is going to be when we have ‘solved’ everything. But the problem we are facing is not that we lack the ability to dream, or to imagine a better world. The problem now is that we need to wake up. It’s time to face the reality, the facts, the science. And the science doesn’t mainly speak of ‘great opportunities to create the society we always wanted’. It tells of unspoken human sufferings, which will get worse and worse the longer we delay action – unless we start to act now.
- Greta Thunburg

MacMahon argues that this implies a criticism not just of the those who deny there’s a climate crisis, but also those who accept the science and advocate action to deal with the problem – selling it to voters with promises of all sort of side benefits. Even something as radical as a Green New Deal, as proposed by the Left of the Democratic Party in America and, in the UK, by the Labour Party, is promoted as something we’d want anyway – a new New Jerusalem. ...  Continue reading