“If the value system collapses, how can the social system be sustained?” Wu Huning, adviser to Xi. A few snippets below on: Dangerous academics on nuclear escalation Tories imploding, a chance to replace them Chances of mass non-payment of bills in Britain
Im not sure cos Im not doing market research. Im guessing.
Members like the country wd support wealthiest 1% having perks/loopholes closed to help nhs.
i dont underestimate importance of inflation/debt - my point is about how to frame a choice in the election. fiscal responsibility plus breaking the manifesto guarantee is bad framing.
Good to see you've adopted John Mearsheimer's view of the cause of the UKR/Russia war! Just beware you might be put on a Ukrainian blacklist like Mearsheimer lol But ironic to think that our intellectual betters have adopted the hive mind notion that escalation is now oddly synonymous with diplomacy. The West has substituted coherent foreign policy for moral absolutism with zero defined goals that only leads to entropy exponentially increasing in the system (2nd law of thermodynamics comes to mind). While Ukraine has a right to defend itself against Russia it must do so on an equitable cost basis so that our allies (really protectorates) across the Atlantic can share our financial burden. It's only a matter of time before the next check arrives as Zelensky laid the groundwork for a potential $750 Billion (yes, with a “B”) Marshal Plan redux that he intends to hit the United States and Western countries with as part of yet another failed nation building experiment.
Also kudos for referencing Wang Huning! The West needs to read more authors who challenge their worldview and reality.
DC, if you can destroy the Tory party, I will personally start the campaign to get your statue permanently placed on the vacant plinth in Trafalgar Square.
It's not a party...Did you know lemmings are actually solitary creatures but when they get together its' called a slice of lemmings. RIP Tory Slice. Martin Lewis needs to be part of start up.
Time to make money from this was to buy TTF futures around the invasion when many industry specialists were sceptical and entirely missed it.
If Rishi understood economics, maybe HMT could at least have hedged the UK gas price exposure of failing companies and companies that were gonna fail anyway. But then if Rishi understood economics he would have issued Pandemic War Loan at 0.70 % forever when people like David Davis were telling him to.
Generally the market discounts future developments before any single mind can fully understand what is coming.
Other opportunities I don't know. In Germany you can't gather your own firewood - you need to pay a specialist to do it for you. There should be all kinds of shocks rippling out from energy becoming very expensive and German and other industry shutting down but it's much more work to benefit from that in a real business than in financial markets.
Probably India and Eastern Europe will benefit in relative terms from the changes ahead.
1) you seem relatively quite confident about replacing the Tories, as attempts for new parties to subvert the mainstream parties always fail e.g. SDP, UKIP, Brexit party, Change UK. Do you think the difficulty of new parties succeeding is overstated?
2) On reading that section on China and western decadence; out of interest how would you describe your own social views? How much do you think traditional social norms matter?
3) Should/can the current oil crisis be a opportunity to politically mobilise the west towards nuclear or renewable energy?
4) what’s your opinion on Julian Assange and his extradition to the US?
5) in regards to your reading list; how do you evaluate if the authors are sharing genuinely useful lessons or if it’s snake oil? This issue is a major one for me with my autism and perfectionism.
Great blog as always. But why wait for forming the new movement? Really don't want to see Labour - Lib Dems in 2024...better to the Hammer and not the anvil correct...?
You are too kind on Rishi. Whatever his so called close allies say, the fact is he made a deal with the Tory Establishment and the 'One Nation' types to NOT touch International law. He may be genuine in his desire to change the state, maybe, but the truth is you can't change anything about the country unless you deal with the overhang from Brexit, ie the remaining governence from the international legal system - the ECHR, NI, International Aid, Asylum Rights. He has made his choice.
I hope you do start a new movement before the election. It's not hard to envisage it running jointly with some of the sitting Tory MPs. There are perhaps 50 or so seats in England and Wales that would have been won last time had Farage not run, and even the SNP could be vulnerable to an insurgent 'Scottish People's Party' given the horror they've inflicted on their people.
And as a last thought - delaying forming a new movement means more suffering. It means more people dying because of bad healthcare, more children facing the horrors of stonewall, more pensioners dying from the cold.
Has anyone come up with an explanation for the UK's terrible productivity growth over the past 10-15 years? Brexit has made no difference, labour shortages have made no difference. What is the root cause? Is there a solution that's politically accessible?
Mobile phones. Check your weekly screen time hours. eg 20hours per week.
Divide this figure by 40hours and then multiply it by 100 and that tells you the percentage of how higher your income would be if you didn’t piss away so much time on your mobile.
That isn't an explanation for the UK's productivity failure. (For Uber drivers, not spending time on their mobile would be lost work. Does driving an Uber increase productivity?)
I thought you wanted the root cause for falling productivity for the the entire population?
Productivity is an average, so you can’t really break out counter trend exemptions, of course there are counter examples but that wasn’t your question.
Uber drivers are a minuscule subset of the working population. The average worker is an office worker that spends X hours per work day picking up their phone to check notifications.
All the most successful apps are literally designed to tap into your endocrinology and reinforce dopamine addictions. They employ large teams of neuroscientists and clinical psychiatrists in order to achieve this.
Mobile phones have literally trained people to be less productive. Big tech generates revenue from captured eyeballs but it is effectively stealing that attention from the phone users office computer.
Germany, to take an example, has smartphones across the population, and its productivity is improving more quickly than the UK. Checking this is an obvious way to disprove your assertion. Possibly you're spending too much time obsessing about smartphones and it's affecting *your* productivity, but it isn't an explanation for the UK population compared to others.
Unproven. If you have a peer-reviewed study that shows this, please cite it. By contrast, very easy to argue that smartphones improve productivity: email on the move, access to data on the move, 24/7/365 connectivity to data from organisations. Uber, Stripe, mobile accounting apps, mobile apps for insurance claims, the list is endless.
I'll ignore any response that doesn't link to a peer-reviewed study showing smartphones reduce productivity.
Declining productivity is simple to explain. Most people are disappointments, regulations hamper manufacturing and R&D and dangerous/spiteful idiots enforce these regulations. The recent comments from William Hague regarding 'doing for science what was done for sport' are interesting, but pointless giving levels of scientific literacy and the distain the establish aims at those with any.
Conversely, China have a plan and support industries, so its cheaper to sub out work to China. Financial people with no interest in anything other than a cost push things to China. If anything is complicated to understand and needs the funders to have something like, an education, just ignore it. Too difficult...
This leads to domestic businesses failing, those that succeed despite the odds then decide to screw the Government for the pain they inflicted. Directors go off and be an ex-pat or whatever, dodge tax in the schemes the politician and celebrities enjoy and leave the clusterf*ck behind.
Meanwhile declining jobs, intelligence and ambition of the mass population leads people to either aspire to work for the civil service and get paid to ensure nothing happens and make sure they don't understand it anyway. Or more commonly people go and enjoy handouts to stay at home. More and more people go onto credits and become a significant and increasing voting block to put the politicians into their cushy positions. Those politicians can then milk the system for whatever is left.
People wasting time on mobiles isn't the cause, its something to do with the time where people can't be bothered to have a purpose. Once they have reached the point of wasting their time, then yes, stu255 comments relating to the addictiveness are correct. But you have to slump to that level before getting trapped in it.
Charles Darwin is know for his 'survival of the fittest' thing. We now have: Abuse anyone who can achieve anything and redistribute wealth to the incompetent, lazy and untrustworthy. Its a bit like taking the bad bits of communism and putting it on steroids.
And that’s specific to the last 10-15 years? As per the original question?
I would say your points are a much longer term arc.
Manufacturing decline was mostly the 80’s and 90’s. By 2007 (which was 15 years ago) the UK economy was very much a service economy.
Currently the UK does not have a very technical labour force, certainly compared to Germany. We could change this with a strategy to do so, but most of our shift away from technical industries happened prior to the period considered by the OP.
... I don’t really disagree with anything you have said, I just think in the last 10-15 years (iPhone was released exactly 15 years ago), screen time is a big factor, for many people it is 10’s of hours per week that much of which was previously allocated to economic activities either as a producer or a consumer.
I also think this smartphone debt will eventually swing to productivity gains, as the technology increasingly pays back advantages such as all manner of life efficiencies and improvements.
2 - China is very, very, very big. I asked Tim Cook why Apple makes its stuff in China rather than the US: the answer's simple - the factories are bigger, the workforce is available. You just can't do that even in America. Bigger and available does mean cheaper. That's how economics works. Compare how many chip foundries there are in China, the US, and Europe. (Taiwan's a giant, forward-looking exception. It's also like living in Blade Runner.)
3 - "declining.. intelligence". Charm will get you everywhere. Still doesn't explain why Germany's productivity is growing faster than the UK's (which, to be clear, *is* growing, but much more slowly than European or world peers).
4 - perhaps you haven't heard, but the "handouts culture" isn't a thing. Universal Credit is stringent. There's no voting bloc that puts politicians into "cushy positions".
5 - Darwinism/communism: this doesn't provide empirical data about the productivity puzzle.
Thanks Charles, I really enjoyed your medium article.
But to make one point using your example of toughened or laminated glass. The problem with legislating that toughened glass must be used is to stop all innovation of potentially superior types of glass.
Lots of regulations demand a particular form and factor of a product and often this precludes a lot of further innovation.
If you transported a driverless car from the year 2100 back in time to 2022. It would likely be illegal to use it, it wouldn’t have wing mirrors or indicator lights, it couldn’t pass an MOT. It would be superior to current cars in every technical way, but today’s regulations would not recognise this and would categorise it as non-compliant and not fit for use.
If you have to break regulation to advance a product (which is often the case) that slows down innovations reaching the market by a factor of 10 to 50.
There isn’t a clean answer to this. It depends on what speed of innovation you actually want. If you are happy with an industry innovating at 2% improvement per year then you could create a regulatory environment for that. But if you want the same industry to innovate at 10% improvement per year you would need a very different regulatory environment.
Not all industries have equal opportunity for innovation and opportunity varies with industry and time.
This is why you need an overarching industrial strategy to optimise all of this. But nobody has the competence to write a good one! So we muddle through arguing our interests and complaining about counter-interests.
Personally I think the smartest thing to do is to slacken and tighten regulations on a given industry on a decade by decade sinusoid and maybe this will release bursts of innovation and then crystallise the gains.
I also like creating business cycles and tempos at a high level as this is good for planning R&D, capex, expansion, etc. A linear plodding forward isn’t really how things improve, innovation happens in bursts it’s much more a ‘punctuated equilibrium’, and having regulations unlock and loosen then relock again on a predictable and known timeline would be great for aggregating and allocating capital and really pushing to punctuate the equilibrium inside a window of opportunity created by the expected regulatory flux.
I apologise if my wordsmithing skills are not putting my thoughts across in the best way. Trying to keep a series of points relatively concise for a blog posting is clearly not one of my strong points.
Your article is not really the norm. Big accidents killing people make it into the news as they are rare. A boat sinks, nuclear power station melts down or whatever probably sells more papers than 'man at work has a slightly hurty knee'.
I think the original intention may well have been to 'stop people lopping arms off', but it is not what happens now. Employees who are dead or maimed are not normally very productive, so companies tend to avoid this situation.
Given the moment an HSE inspector arrives, they charge for all their time under the FFI scheme, and SME's are typically busy and not resourced for protracted fights, for small companies this is basically racketeering at best. It is also important to look at when an inspector decides to check a company. According to two senior HSE employees I have spoken to, over 85% of action is because an informant raised a claim. Most of these are ex or soon to be ex-employees. Some will have valid reasons, and many will have a axe to grind. Given the cost to the companies visited, apply a percentage for the vexatious visits where HSE have not recognised the motives, see the total cost to the economy and there is a good argument that this amounts to domestic terrorism.
It is not the case for larger entities who can treat people as disposable and have enough clout to avoid any repercussions. Take Amazon as an example of this, a few seconds on google will show they are achieving an incident and a report made to HSE at an average of roughly every working day. Amazon do not feature on the HSE's registers of enforcement.
If we explore metal finishing regulations and read all the HSE's documents and supporting documents we find the guidance includes these statements:
‘there is no clear guidance for the industry’.
“The different measures vary in cost, complexity, ease of use and efficacy. There is no clear guidance for the industry on the most appropriate and cost-effective techniques.”
“This guidance is issued by the Health and Safety Executive. Following the guidance is not compulsory and you are free to take other action.”
When the guidance itself says it isn't good enough and you don't have to follow it, you have to wonder what the point of it is. Particularly when HSE enforce it, knowing they say its irrelevant.
It will require thousands of words to demonstrate how technically illiterate the whole thing which I doubt anyone here cares about. However HSE actually did a study of this industry and found even when guidance and best practice was not followed, the dangerous conditions they were concerned with did not happed. This referred to metal salts in the air under COSHH. This is what would be expected from ECHA, but more importantly from basic chemistry as metal salts do not evaporate from solution. Their use of pieces of equipment costing circa £300k, and spending months of time to verify key stage 3 science was not a good use of tax payers (and racketeered) money.
Obviously metal finishing and other industrial processes will use chemicals, and 'declining intelligence' seems to lead to people thinking all chemicals are immediate very bad and dangerous. Some chemicals used in industrial processes are also used in tattooing. EU banned a load of these for tattoo usage, and current HSE are evaluating doing the same. I am expecting HSE will also conclude a ban on isopropyl alcohol is required due to its danger level. It is used to clean the skin prior to a tattoo and is used extensively in industry. But how is is suddenly so dangerous now? Given hand sanitisers were mandated through the pandemic, and they tend to be 70-99% isopropyl alcohol (IPA), was it dangerous then? Do they just have no idea what they are doing?
Similarly regarding metal working fluids HSE fail to show competence. There are small risks associated with machining coolant, principally dermatitis and occupational asthma. With dermatitis accounting for over 90% of issues and these are rarely serious. So currently HSE are on a campaign about metal working fluids causing occupational asthma. Using their own statistics this is an effort to stop 3.5 cases per year. So whilst it isn't a legal requirement to have LEV fitting to a CNC machine they are forcing it, costing thousands per machine. Yet having spoken with one of the larger installers of CNC LEVs, they have no specification to work too, as HSE cannot or will not provide a target as a safe level.
This is an ongoing tactic of HSE, they will not do anything which makes complying clear, and just say whatever has been done isn't good enough so they can send an invoice. When their arguments are flawed as they are scientifically impossible, they just change the subject.
Yes there are a few occasions when incidents do, or could, happen which need to be dealt with. But these clowns do not focus on that, and don't seem competent enough to do so.
In addition to growth of red tape and bureacracy. Everyone spends their whole time adhearing to rules and being compliant instead of getting on and building/making things. Speak to any entrepreneur and they will tell you compliance takes SO much time especially in Finance. Money laundering regualtion is a great example of this: https://theconversation.com/the-global-war-on-money-laundering-is-a-failed-experiment-125143
Culture. More precisely lack of professionalism. By professionalism I mean the attitude of wanting to do whatever you are doing (be that cleaning toilets, flying planes or typing numbers into a spreadsheet) as best as you possibly can.
If you really care about how well you do something then when someone comes along and says "I can show you a process/machine/idea that will help you better/faster/more efficiently do that" your response is "great! Show me!". If, on the other other hand, you don't give a s**t then your response is more likely to be "aint my job mate!" or even more likely just say nothing and passively resist any change no matter how well intentioned or objectively better it may be.
The UK's higher performing organisations (e.g. Formula 1, UKSF special forces, ARM chip design, Deepmind etc etc) notably don't have this cultural problem. In most places it's not 'cool' to try too hard. In these organisations you are binned if you don't continuously improve.
The solution is to transplant that culture into more and more UK businesses. You could get ex-SF soldiers for example to go round to various companies and talk to people to start making 'doing your job to the highest standard' cool.
Marc Faber says chronic monetary inflation says FIRE and government have bid resources away from productive sectors, leading to a kind of Dutch disease. No end in sight for that so long as we have central banks without hard money.
See Nicholas Crafts - productivity experiences swings that are multi decadal.
Also John Taylor on policy induced cycle - he says bad regulation and administrative state has suppressed entrepreneurship.
Brookings observed at their conference on productivity that the stagnation was confined to education, healthcare and manufacturing - all areas where poor policy (and bad courts) might not have helped.
World of bits is moving to influence world of atoms. Open source machine tools for example could open up innovation in manufacturing.
Some of it is about courage and daring. Marc Andreesen at a16z "It's time to build" is encouraging from that perspective.
It started in 2008 so there must be something there. Every recession before 2008 we, like all other countries, returned to trend soon enough. However since 2008 we have never returned to trend. What did we lose then and never recover. What policies were introduced? I don't know but 2008 is key.
On "what Rishi Sunak should say" - what you suggest might credibly work in a general election campaign with the public (though you'd need to slim it down to some three-word slogans) but there's not a hope in hjell that that would go down well with the Conservative membership. Have you *seen* them?? They still think Boris is the best thing ever. I'm surprised to write this, but you're overestimating their rationality.
'...what to do in 2023 to build something that after the 2024 election could speak to the country... in a completely different way with different people?'
I expect many of us here would like to help, and are keen to hear how.
Unfortunately, the chart showing "cash levels highest since 2001" is misleading because it doesn't take into account the huge growth of passive/index fund managers which hold practically zero cash. Only active fund mangers respond to the survey, so with the active/passive spilt being around 50/50, actual cash in the market is 50% x 0% + 50% x 6% = 3%. All time low.
What's going to happen to those who do not have the wherewithal to keep feeding the prepayment meter? You would see the effects of natural gas at $15 and beyond far more quicker with that cohort than amongst those who have the choice to cancel the direct debit.
The BBC is also f'ed, what comes first putting food on the table or paying the TV licence?
Energy prices are spiking because of supply shocks but failure to forecast demand from new technology is also causing problems.
Worryingly, Hillingdon, Ealing and Hounslow have suspended new housing until 2035 due to a lack of electricity supply. This is because of lots of high energy usage data centres being built there and the grid being unable to cope.
The root cause is Ofgem being unable to predict increases in demand from this new technology. We don’t want to have to choose between running out of cloud compute and running out of homes…
"Energy prices are spiking because of supply shocks but failure to forecast demand from new technology is also causing problems."
Its not that simple, and I think that implies more innocence that I would apply to the situation.
Petrol prices and oil prices are clearly not showing the relationship they have previously. Within the last three months we have seen petrol prices around £1.90/lt, meanwhile Brent got to around $128 per barrel in March and have come down. Brent breach $147/bbl in July 2008, and at that point petrol was about £1.20/lt. That is a big discrepancy.
Coronavirus obviously impacted travel and that has knock on effects to oil drilling, production etc. It got to the point of jet fuel being stored in FSPO's which is not good for the shelf life, so that would disrupt things over medium term, but its not exactly a shock at this point, its the after effects.
Last December Alcoa announced the temporary cease of aluminium smelting for 2 years at the San Ciprian plant in Spain, but agreed to keep paying workers. This was due to energy prices in the EU. Needless to say aluminum and other metal prices are volatile and the quote validity time from metal stockists can be shocking at the moment, weeks/months was normal, now its days and I've even heard of prices being held for an hour. It seems Alcoa at least saw energy price issues coming. I think Putin did as well, as he seemed to understand the German reliance on Russian gas. One has to question if the German energy strategy was good as it moved into renewables (expensive, unreliable*) whilst France is less badly effected with more nuclear. Renewables have a time and a place, and it is not everywhere all the time. Greenwashing by watermelons is not always a good thing.
Many new technologies consume less energy than old ones when in usage. Despite increase in mass, cars are more efficient than they were, LEDs use less electricity than incandescent bulbs etc. The energy required to make them isn't always the same story and used to be irrelevant as most things were sent to lower labour cost places for manufacture anyway. UK gov figures for total energy demand shows Q1 2022 0.3% down from Q1 2021.
I suspect the above disagrees with the article you posted behind a paywall. But remember electricity supply and electricity production are not the same. You can have all the electricity you want but if the grid cannot supply it, then its like a broken pencil. Pointless.
I don't think I would agree with your root cause. I would suggest greed, self serving, and trying to appease populist movements drove energy and energy supply policy and implementation into this situation. People appear to be increasingly incapable and/or unwilling to do appropriate analysis of a situation. They decide the solution in advance and push it for every application, not where it is actually sensible.
Perhaps now, it is just a case of increase prices to keep people poor and not allow them to fully exposure how badly the system has been run into the ground and that the green agenda cannot work. Anyone else noticed Greta has been very quiet recently?
The idea that high prices for energy are driven by long term trends, such as self serving and poor organisation, rather than a Ukraine war supply shock makes sense, is that what you are saying?
Certainly true that inflation was going up before this, loose monetary policy also a factor.
That's sort of what I'm saying. To be honest some of it is a question not a fully formed opinion.
Energy prices are extremely complex and I have considered at times what really drives oil/gas/energy prices and never managed to work out whether the tail is wagging the dog or otherwise.
It was widely claimed the 'shale gas revolution' in the US was enabled by 'new' directional drilling and hydraulic fracturing. Both old technologies to us over here, and this lead to such an investor rush that oil price was basically irrelevant. Notice I said oil...
Oil prices are less regional than gas as its easier to transport, but innovations are applicable to both and some stages. So In theory innovation lowers cost for extraction of both, which wont translate to the market if profits can raise instead, which is what the relevant supplies would do initially. But this must have a long term effect, as the 'peak oil' concept was always 40years away as technically recoverable resources increased. So obvious questions:
1. does demand drive innovation?
2. does innovation drive short term prices
3. does innovation drive long term prices
4. are oil/gas prices driven by something else
I think my answers are: 1. Yes, 2. No, 3. Yes, 4. Yes
The question as to why Ukraine needs interrogation. I would recommend reading the book about PLUTO, Pipelines Under The Ocean, which is basically the birth of coiled tubing to supply WW2 units with petrol. Spoiler alert, absolutely none was supplied, but it lead to a huge interconnected network of oil supplies in the UK for the war effort and beyond. Normally over 9 months supply in place. Obviously mostly closed down now to save money. Idiots again. That would be handy to have a nice big reserve when a war breaks out. But - it was Russian gas for Europe. At the drilling stage there is little difference to most people, at the supply side it is different. So the effect on petrol, made from oil does not add up.
Currently there isn't much electricity made from oil, gridwatch seems to show 0% for the last few months. So again, why is the price of petrol so high?
Electricity could well go up, as we all know renewables are more expensive, and we still import electricity from Europe which will be affected by Russian gas supply, but this all feels too much. So is it short term profiteering? BP are doing rather well at the moment. Or is it bad policy?
It certainly seemed from the outside like marrying the PM was enough to make you an expert on energy supply. I've never met her, but I suspect like most people she cannot or will not do numbers. The 2MW wind turbine by the M4 near Reading is an example of renewables, sometimes running. Ofgem say its works about 15% of the time, I've seen some claims as low as 3%. But bear in mind 2000kW is 2682bhp, there are individual hypercars which are that kind of output. Moving things needs lots of energy. The average car in the UK is 121bhp (obviously not using all of the most of the time, 30-50bhp will get most cars along at ~60mph), so the windmill is the equivalent of just 22 cars in power terms (maybe 90 at best).
Perspective is needed before you claim renewables are the solution everywhere. I don't think there has been any sensible plan in place for the energy security of the UK.
Hi Dom, I think I can explain Ryan's UC taper comment.
If you have a given minimum income (say £1000 to make this example be easy to understand) that you are going to give someone on UC, then suppose you have a taper of 50%, then this means that until they earn £2000 they will still be getting money from UC.
If the taper were instead 25% then instead it will be until they earn £4000.
Ryan is saying that after decreasing the taper all the people earning between £2000 and £4000 will have a higher marginal tax rate than with the higher taper rate.
which means with a base rate (20%) taper UC claimants will still be tapering off UC when they are earning £15000 per year, which is above the income tax personal allowance, so at that point in the income scale people will be getting effective marginal tax rates from NI + UC + income tax. This ends up being ~50%
This will be at an even higher income level for people (e.g. those over 25) who have even higher UC payments.
So if we just reduced the taper without also changing income tax somehow, we're just changing who has the ~50% effective tax rate from the very low income to the quite low income.
Maybe we should still take the trade but there are other complications e.g. UC currently also is reduced if you have savings, so we'd also get this policy disincentivising saving for people with much higher incomes.
RE the business rates, going the full hog by having a land value tax on residential property could be the way to link VL working class with elements of urban working class and young. It would help to bring housing market back to reality (particularly by hitting foreign investors/owners of empty houses hard), would encourage "levelling up" and could be used to cut income tax/NI/business rates etc.
Also thanks for the focus group link. The looming nightmare of this winter cannot be overemphasised. I speak to people every day who are at the end of their tether because their benefits won't cover the cost of basic bills. I also speak to people every day who are struggling with bills even though they work, and who are saying "I should be on benefits anyway as they get all the special payments from HMT!" Numbers of people needing help are off the scale... in June and July. A very large group of malcontents being built, and when Winter bills hit + cost of Christmas it is going to go to shit. SW1 needs to wake up now if it wants any chance of avoiding some level of unrest and collapse!
Im not sure cos Im not doing market research. Im guessing.
Members like the country wd support wealthiest 1% having perks/loopholes closed to help nhs.
i dont underestimate importance of inflation/debt - my point is about how to frame a choice in the election. fiscal responsibility plus breaking the manifesto guarantee is bad framing.
He IS a Thatcherite/treasury man
Good to see you've adopted John Mearsheimer's view of the cause of the UKR/Russia war! Just beware you might be put on a Ukrainian blacklist like Mearsheimer lol But ironic to think that our intellectual betters have adopted the hive mind notion that escalation is now oddly synonymous with diplomacy. The West has substituted coherent foreign policy for moral absolutism with zero defined goals that only leads to entropy exponentially increasing in the system (2nd law of thermodynamics comes to mind). While Ukraine has a right to defend itself against Russia it must do so on an equitable cost basis so that our allies (really protectorates) across the Atlantic can share our financial burden. It's only a matter of time before the next check arrives as Zelensky laid the groundwork for a potential $750 Billion (yes, with a “B”) Marshal Plan redux that he intends to hit the United States and Western countries with as part of yet another failed nation building experiment.
Also kudos for referencing Wang Huning! The West needs to read more authors who challenge their worldview and reality.
Counterpoint:
https://twitter.com/nntaleb/status/1500485579745775619?lang=en
DC, if you can destroy the Tory party, I will personally start the campaign to get your statue permanently placed on the vacant plinth in Trafalgar Square.
We got rid of Boris but looks like the Party will destroy itself over next 18 months
It's not a party...Did you know lemmings are actually solitary creatures but when they get together its' called a slice of lemmings. RIP Tory Slice. Martin Lewis needs to be part of start up.
1/ :))) well spotted!
The (national) Conservative Party has certainly proven itself bankrupt. Perhaps a shift in how government posts are populated would help?
PM obviously has to be the person able to get bills through Parliament/the Commons but could appoint outsiders to run Departments.
This might bypass the problem of appointing politicians to administrative/policy posts (wrong skillsets?).
Potential for massive corruption...they already have buddies doing/getting enough.
"Nutshell: Russia is going to squeeze Europe on energy over winter"
1. How can I make money from this?
2. How can I make money from this ethically? (Think Taleb-ethically not green-ethically)
Time to make money from this was to buy TTF futures around the invasion when many industry specialists were sceptical and entirely missed it.
If Rishi understood economics, maybe HMT could at least have hedged the UK gas price exposure of failing companies and companies that were gonna fail anyway. But then if Rishi understood economics he would have issued Pandemic War Loan at 0.70 % forever when people like David Davis were telling him to.
Generally the market discounts future developments before any single mind can fully understand what is coming.
Other opportunities I don't know. In Germany you can't gather your own firewood - you need to pay a specialist to do it for you. There should be all kinds of shocks rippling out from energy becoming very expensive and German and other industry shutting down but it's much more work to benefit from that in a real business than in financial markets.
Probably India and Eastern Europe will benefit in relative terms from the changes ahead.
1) you seem relatively quite confident about replacing the Tories, as attempts for new parties to subvert the mainstream parties always fail e.g. SDP, UKIP, Brexit party, Change UK. Do you think the difficulty of new parties succeeding is overstated?
2) On reading that section on China and western decadence; out of interest how would you describe your own social views? How much do you think traditional social norms matter?
3) Should/can the current oil crisis be a opportunity to politically mobilise the west towards nuclear or renewable energy?
4) what’s your opinion on Julian Assange and his extradition to the US?
5) in regards to your reading list; how do you evaluate if the authors are sharing genuinely useful lessons or if it’s snake oil? This issue is a major one for me with my autism and perfectionism.
I dont think it's easy at all, for sure it's hard. but the circumstances now make it possible, much more so than usual
yes obviously we shd use the UKR disaster to push for new energy technology. but the old regimes can't do it other than incompetently.
no view on Assange
"3) Should/can the current oil crisis be a opportunity to politically mobilise the west towards nuclear or renewable energy?"
Well, 'or' is better than 'and'.
Because nuclear should get all the attention, 'renewables' none.
So, scrap all subsidies for renewables and remove most of the safety red-tape hindering nuclear - see Oxford physics professor emeritus Wade Allison eg https://www.linkedin.com/pulse/you-dont-have-scientist-trust-nuclear-energy-wade-allison/ for 'the science' there. And by all means have an ARIA-like entity invest in early R&D in the nuclear area.
How would you approach your educational institution (at any/all age levels)?
Great blog as always. But why wait for forming the new movement? Really don't want to see Labour - Lib Dems in 2024...better to the Hammer and not the anvil correct...?
You are too kind on Rishi. Whatever his so called close allies say, the fact is he made a deal with the Tory Establishment and the 'One Nation' types to NOT touch International law. He may be genuine in his desire to change the state, maybe, but the truth is you can't change anything about the country unless you deal with the overhang from Brexit, ie the remaining governence from the international legal system - the ECHR, NI, International Aid, Asylum Rights. He has made his choice.
I hope you do start a new movement before the election. It's not hard to envisage it running jointly with some of the sitting Tory MPs. There are perhaps 50 or so seats in England and Wales that would have been won last time had Farage not run, and even the SNP could be vulnerable to an insurgent 'Scottish People's Party' given the horror they've inflicted on their people.
And as a last thought - delaying forming a new movement means more suffering. It means more people dying because of bad healthcare, more children facing the horrors of stonewall, more pensioners dying from the cold.
But I guess we will see.
Best dude.
Has anyone come up with an explanation for the UK's terrible productivity growth over the past 10-15 years? Brexit has made no difference, labour shortages have made no difference. What is the root cause? Is there a solution that's politically accessible?
Mobile phones. Check your weekly screen time hours. eg 20hours per week.
Divide this figure by 40hours and then multiply it by 100 and that tells you the percentage of how higher your income would be if you didn’t piss away so much time on your mobile.
That isn't an explanation for the UK's productivity failure. (For Uber drivers, not spending time on their mobile would be lost work. Does driving an Uber increase productivity?)
This FT article (https://www.ft.com/content/442fb59c-d138-11e8-a9f2-7574db66bcd5) suggests it's because of low levels of training among those entering work. But I'd be interested to hear other explanations.
I thought you wanted the root cause for falling productivity for the the entire population?
Productivity is an average, so you can’t really break out counter trend exemptions, of course there are counter examples but that wasn’t your question.
Uber drivers are a minuscule subset of the working population. The average worker is an office worker that spends X hours per work day picking up their phone to check notifications.
All the most successful apps are literally designed to tap into your endocrinology and reinforce dopamine addictions. They employ large teams of neuroscientists and clinical psychiatrists in order to achieve this.
Mobile phones have literally trained people to be less productive. Big tech generates revenue from captured eyeballs but it is effectively stealing that attention from the phone users office computer.
Germany, to take an example, has smartphones across the population, and its productivity is improving more quickly than the UK. Checking this is an obvious way to disprove your assertion. Possibly you're spending too much time obsessing about smartphones and it's affecting *your* productivity, but it isn't an explanation for the UK population compared to others.
That doesn’t disprove anything. German productivity would be growing even faster sans smartphones.
Smartphones and unproductive screen time is the biggest downward pressure on productivity over your 10-15 year horizon.
There are two other big factors over a longer term horizon; 1). We invest a lower percentage of GDP in automations
2). We invest a lower percentage of GDP in R&D
Unproven. If you have a peer-reviewed study that shows this, please cite it. By contrast, very easy to argue that smartphones improve productivity: email on the move, access to data on the move, 24/7/365 connectivity to data from organisations. Uber, Stripe, mobile accounting apps, mobile apps for insurance claims, the list is endless.
I'll ignore any response that doesn't link to a peer-reviewed study showing smartphones reduce productivity.
Declining productivity is simple to explain. Most people are disappointments, regulations hamper manufacturing and R&D and dangerous/spiteful idiots enforce these regulations. The recent comments from William Hague regarding 'doing for science what was done for sport' are interesting, but pointless giving levels of scientific literacy and the distain the establish aims at those with any.
Conversely, China have a plan and support industries, so its cheaper to sub out work to China. Financial people with no interest in anything other than a cost push things to China. If anything is complicated to understand and needs the funders to have something like, an education, just ignore it. Too difficult...
This leads to domestic businesses failing, those that succeed despite the odds then decide to screw the Government for the pain they inflicted. Directors go off and be an ex-pat or whatever, dodge tax in the schemes the politician and celebrities enjoy and leave the clusterf*ck behind.
Meanwhile declining jobs, intelligence and ambition of the mass population leads people to either aspire to work for the civil service and get paid to ensure nothing happens and make sure they don't understand it anyway. Or more commonly people go and enjoy handouts to stay at home. More and more people go onto credits and become a significant and increasing voting block to put the politicians into their cushy positions. Those politicians can then milk the system for whatever is left.
People wasting time on mobiles isn't the cause, its something to do with the time where people can't be bothered to have a purpose. Once they have reached the point of wasting their time, then yes, stu255 comments relating to the addictiveness are correct. But you have to slump to that level before getting trapped in it.
Charles Darwin is know for his 'survival of the fittest' thing. We now have: Abuse anyone who can achieve anything and redistribute wealth to the incompetent, lazy and untrustworthy. Its a bit like taking the bad bits of communism and putting it on steroids.
And that’s specific to the last 10-15 years? As per the original question?
I would say your points are a much longer term arc.
Manufacturing decline was mostly the 80’s and 90’s. By 2007 (which was 15 years ago) the UK economy was very much a service economy.
Currently the UK does not have a very technical labour force, certainly compared to Germany. We could change this with a strategy to do so, but most of our shift away from technical industries happened prior to the period considered by the OP.
... I don’t really disagree with anything you have said, I just think in the last 10-15 years (iPhone was released exactly 15 years ago), screen time is a big factor, for many people it is 10’s of hours per week that much of which was previously allocated to economic activities either as a producer or a consumer.
I also think this smartphone debt will eventually swing to productivity gains, as the technology increasingly pays back advantages such as all manner of life efficiencies and improvements.
I find this analysis woefully simplistic.
1 - "regulations hamper manufacturing". No, they stop people lopping arms off, producing poisonous products, making substandard products. Please cite a regulation that has absolutely no use. (I wrote about how people mistake "regulation I don't understand" for "regulation that's no use" on Medium a while back: https://medium.com/politicsmeanspolitics/the-herald-of-disaster-or-why-you-should-welcome-regulations-fbaaeaed17e5
2 - China is very, very, very big. I asked Tim Cook why Apple makes its stuff in China rather than the US: the answer's simple - the factories are bigger, the workforce is available. You just can't do that even in America. Bigger and available does mean cheaper. That's how economics works. Compare how many chip foundries there are in China, the US, and Europe. (Taiwan's a giant, forward-looking exception. It's also like living in Blade Runner.)
3 - "declining.. intelligence". Charm will get you everywhere. Still doesn't explain why Germany's productivity is growing faster than the UK's (which, to be clear, *is* growing, but much more slowly than European or world peers).
4 - perhaps you haven't heard, but the "handouts culture" isn't a thing. Universal Credit is stringent. There's no voting bloc that puts politicians into "cushy positions".
5 - Darwinism/communism: this doesn't provide empirical data about the productivity puzzle.
Thanks Charles, I really enjoyed your medium article.
But to make one point using your example of toughened or laminated glass. The problem with legislating that toughened glass must be used is to stop all innovation of potentially superior types of glass.
Lots of regulations demand a particular form and factor of a product and often this precludes a lot of further innovation.
If you transported a driverless car from the year 2100 back in time to 2022. It would likely be illegal to use it, it wouldn’t have wing mirrors or indicator lights, it couldn’t pass an MOT. It would be superior to current cars in every technical way, but today’s regulations would not recognise this and would categorise it as non-compliant and not fit for use.
If you have to break regulation to advance a product (which is often the case) that slows down innovations reaching the market by a factor of 10 to 50.
There isn’t a clean answer to this. It depends on what speed of innovation you actually want. If you are happy with an industry innovating at 2% improvement per year then you could create a regulatory environment for that. But if you want the same industry to innovate at 10% improvement per year you would need a very different regulatory environment.
Not all industries have equal opportunity for innovation and opportunity varies with industry and time.
This is why you need an overarching industrial strategy to optimise all of this. But nobody has the competence to write a good one! So we muddle through arguing our interests and complaining about counter-interests.
Personally I think the smartest thing to do is to slacken and tighten regulations on a given industry on a decade by decade sinusoid and maybe this will release bursts of innovation and then crystallise the gains.
I also like creating business cycles and tempos at a high level as this is good for planning R&D, capex, expansion, etc. A linear plodding forward isn’t really how things improve, innovation happens in bursts it’s much more a ‘punctuated equilibrium’, and having regulations unlock and loosen then relock again on a predictable and known timeline would be great for aggregating and allocating capital and really pushing to punctuate the equilibrium inside a window of opportunity created by the expected regulatory flux.
I apologise if my wordsmithing skills are not putting my thoughts across in the best way. Trying to keep a series of points relatively concise for a blog posting is clearly not one of my strong points.
Your article is not really the norm. Big accidents killing people make it into the news as they are rare. A boat sinks, nuclear power station melts down or whatever probably sells more papers than 'man at work has a slightly hurty knee'.
I think the original intention may well have been to 'stop people lopping arms off', but it is not what happens now. Employees who are dead or maimed are not normally very productive, so companies tend to avoid this situation.
Given the moment an HSE inspector arrives, they charge for all their time under the FFI scheme, and SME's are typically busy and not resourced for protracted fights, for small companies this is basically racketeering at best. It is also important to look at when an inspector decides to check a company. According to two senior HSE employees I have spoken to, over 85% of action is because an informant raised a claim. Most of these are ex or soon to be ex-employees. Some will have valid reasons, and many will have a axe to grind. Given the cost to the companies visited, apply a percentage for the vexatious visits where HSE have not recognised the motives, see the total cost to the economy and there is a good argument that this amounts to domestic terrorism.
It is not the case for larger entities who can treat people as disposable and have enough clout to avoid any repercussions. Take Amazon as an example of this, a few seconds on google will show they are achieving an incident and a report made to HSE at an average of roughly every working day. Amazon do not feature on the HSE's registers of enforcement.
If we explore metal finishing regulations and read all the HSE's documents and supporting documents we find the guidance includes these statements:
‘there is no clear guidance for the industry’.
“The different measures vary in cost, complexity, ease of use and efficacy. There is no clear guidance for the industry on the most appropriate and cost-effective techniques.”
“This guidance is issued by the Health and Safety Executive. Following the guidance is not compulsory and you are free to take other action.”
When the guidance itself says it isn't good enough and you don't have to follow it, you have to wonder what the point of it is. Particularly when HSE enforce it, knowing they say its irrelevant.
It will require thousands of words to demonstrate how technically illiterate the whole thing which I doubt anyone here cares about. However HSE actually did a study of this industry and found even when guidance and best practice was not followed, the dangerous conditions they were concerned with did not happed. This referred to metal salts in the air under COSHH. This is what would be expected from ECHA, but more importantly from basic chemistry as metal salts do not evaporate from solution. Their use of pieces of equipment costing circa £300k, and spending months of time to verify key stage 3 science was not a good use of tax payers (and racketeered) money.
Obviously metal finishing and other industrial processes will use chemicals, and 'declining intelligence' seems to lead to people thinking all chemicals are immediate very bad and dangerous. Some chemicals used in industrial processes are also used in tattooing. EU banned a load of these for tattoo usage, and current HSE are evaluating doing the same. I am expecting HSE will also conclude a ban on isopropyl alcohol is required due to its danger level. It is used to clean the skin prior to a tattoo and is used extensively in industry. But how is is suddenly so dangerous now? Given hand sanitisers were mandated through the pandemic, and they tend to be 70-99% isopropyl alcohol (IPA), was it dangerous then? Do they just have no idea what they are doing?
Similarly regarding metal working fluids HSE fail to show competence. There are small risks associated with machining coolant, principally dermatitis and occupational asthma. With dermatitis accounting for over 90% of issues and these are rarely serious. So currently HSE are on a campaign about metal working fluids causing occupational asthma. Using their own statistics this is an effort to stop 3.5 cases per year. So whilst it isn't a legal requirement to have LEV fitting to a CNC machine they are forcing it, costing thousands per machine. Yet having spoken with one of the larger installers of CNC LEVs, they have no specification to work too, as HSE cannot or will not provide a target as a safe level.
This is an ongoing tactic of HSE, they will not do anything which makes complying clear, and just say whatever has been done isn't good enough so they can send an invoice. When their arguments are flawed as they are scientifically impossible, they just change the subject.
Yes there are a few occasions when incidents do, or could, happen which need to be dealt with. But these clowns do not focus on that, and don't seem competent enough to do so.
this is probably part of the problem: https://en.wikipedia.org/wiki/Bullshit_Jobs#:~:text=Bullshit%20Jobs%3A%20A%20Theory%20is,associates%20work%20with%20self%2Dworth.
In addition to growth of red tape and bureacracy. Everyone spends their whole time adhearing to rules and being compliant instead of getting on and building/making things. Speak to any entrepreneur and they will tell you compliance takes SO much time especially in Finance. Money laundering regualtion is a great example of this: https://theconversation.com/the-global-war-on-money-laundering-is-a-failed-experiment-125143
Spot on.
Free trade.
Culture. More precisely lack of professionalism. By professionalism I mean the attitude of wanting to do whatever you are doing (be that cleaning toilets, flying planes or typing numbers into a spreadsheet) as best as you possibly can.
If you really care about how well you do something then when someone comes along and says "I can show you a process/machine/idea that will help you better/faster/more efficiently do that" your response is "great! Show me!". If, on the other other hand, you don't give a s**t then your response is more likely to be "aint my job mate!" or even more likely just say nothing and passively resist any change no matter how well intentioned or objectively better it may be.
The UK's higher performing organisations (e.g. Formula 1, UKSF special forces, ARM chip design, Deepmind etc etc) notably don't have this cultural problem. In most places it's not 'cool' to try too hard. In these organisations you are binned if you don't continuously improve.
The solution is to transplant that culture into more and more UK businesses. You could get ex-SF soldiers for example to go round to various companies and talk to people to start making 'doing your job to the highest standard' cool.
It's not something confined to Britain.
Marc Faber says chronic monetary inflation says FIRE and government have bid resources away from productive sectors, leading to a kind of Dutch disease. No end in sight for that so long as we have central banks without hard money.
See Nicholas Crafts - productivity experiences swings that are multi decadal.
Also John Taylor on policy induced cycle - he says bad regulation and administrative state has suppressed entrepreneurship.
Brookings observed at their conference on productivity that the stagnation was confined to education, healthcare and manufacturing - all areas where poor policy (and bad courts) might not have helped.
World of bits is moving to influence world of atoms. Open source machine tools for example could open up innovation in manufacturing.
Some of it is about courage and daring. Marc Andreesen at a16z "It's time to build" is encouraging from that perspective.
It started in 2008 so there must be something there. Every recession before 2008 we, like all other countries, returned to trend soon enough. However since 2008 we have never returned to trend. What did we lose then and never recover. What policies were introduced? I don't know but 2008 is key.
Most likely, the method for measuring it was changed.
I have never seen that being a reason suggested.
On "what Rishi Sunak should say" - what you suggest might credibly work in a general election campaign with the public (though you'd need to slim it down to some three-word slogans) but there's not a hope in hjell that that would go down well with the Conservative membership. Have you *seen* them?? They still think Boris is the best thing ever. I'm surprised to write this, but you're overestimating their rationality.
'...what to do in 2023 to build something that after the 2024 election could speak to the country... in a completely different way with different people?'
I expect many of us here would like to help, and are keen to hear how.
Unfortunately, the chart showing "cash levels highest since 2001" is misleading because it doesn't take into account the huge growth of passive/index fund managers which hold practically zero cash. Only active fund mangers respond to the survey, so with the active/passive spilt being around 50/50, actual cash in the market is 50% x 0% + 50% x 6% = 3%. All time low.
Very important point. The pink paged Guardian had something along those lines a while back.
What's going to happen to those who do not have the wherewithal to keep feeding the prepayment meter? You would see the effects of natural gas at $15 and beyond far more quicker with that cohort than amongst those who have the choice to cancel the direct debit.
The BBC is also f'ed, what comes first putting food on the table or paying the TV licence?
Energy prices are spiking because of supply shocks but failure to forecast demand from new technology is also causing problems.
Worryingly, Hillingdon, Ealing and Hounslow have suspended new housing until 2035 due to a lack of electricity supply. This is because of lots of high energy usage data centres being built there and the grid being unable to cope.
The root cause is Ofgem being unable to predict increases in demand from this new technology. We don’t want to have to choose between running out of cloud compute and running out of homes…
https://www.ft.com/content/3f3535b8-02ed-4789-86dd-68283bfe2901
"Energy prices are spiking because of supply shocks but failure to forecast demand from new technology is also causing problems."
Its not that simple, and I think that implies more innocence that I would apply to the situation.
Petrol prices and oil prices are clearly not showing the relationship they have previously. Within the last three months we have seen petrol prices around £1.90/lt, meanwhile Brent got to around $128 per barrel in March and have come down. Brent breach $147/bbl in July 2008, and at that point petrol was about £1.20/lt. That is a big discrepancy.
Coronavirus obviously impacted travel and that has knock on effects to oil drilling, production etc. It got to the point of jet fuel being stored in FSPO's which is not good for the shelf life, so that would disrupt things over medium term, but its not exactly a shock at this point, its the after effects.
Last December Alcoa announced the temporary cease of aluminium smelting for 2 years at the San Ciprian plant in Spain, but agreed to keep paying workers. This was due to energy prices in the EU. Needless to say aluminum and other metal prices are volatile and the quote validity time from metal stockists can be shocking at the moment, weeks/months was normal, now its days and I've even heard of prices being held for an hour. It seems Alcoa at least saw energy price issues coming. I think Putin did as well, as he seemed to understand the German reliance on Russian gas. One has to question if the German energy strategy was good as it moved into renewables (expensive, unreliable*) whilst France is less badly effected with more nuclear. Renewables have a time and a place, and it is not everywhere all the time. Greenwashing by watermelons is not always a good thing.
Many new technologies consume less energy than old ones when in usage. Despite increase in mass, cars are more efficient than they were, LEDs use less electricity than incandescent bulbs etc. The energy required to make them isn't always the same story and used to be irrelevant as most things were sent to lower labour cost places for manufacture anyway. UK gov figures for total energy demand shows Q1 2022 0.3% down from Q1 2021.
I suspect the above disagrees with the article you posted behind a paywall. But remember electricity supply and electricity production are not the same. You can have all the electricity you want but if the grid cannot supply it, then its like a broken pencil. Pointless.
I don't think I would agree with your root cause. I would suggest greed, self serving, and trying to appease populist movements drove energy and energy supply policy and implementation into this situation. People appear to be increasingly incapable and/or unwilling to do appropriate analysis of a situation. They decide the solution in advance and push it for every application, not where it is actually sensible.
Perhaps now, it is just a case of increase prices to keep people poor and not allow them to fully exposure how badly the system has been run into the ground and that the green agenda cannot work. Anyone else noticed Greta has been very quiet recently?
The idea that high prices for energy are driven by long term trends, such as self serving and poor organisation, rather than a Ukraine war supply shock makes sense, is that what you are saying?
Certainly true that inflation was going up before this, loose monetary policy also a factor.
That's sort of what I'm saying. To be honest some of it is a question not a fully formed opinion.
Energy prices are extremely complex and I have considered at times what really drives oil/gas/energy prices and never managed to work out whether the tail is wagging the dog or otherwise.
It was widely claimed the 'shale gas revolution' in the US was enabled by 'new' directional drilling and hydraulic fracturing. Both old technologies to us over here, and this lead to such an investor rush that oil price was basically irrelevant. Notice I said oil...
Oil prices are less regional than gas as its easier to transport, but innovations are applicable to both and some stages. So In theory innovation lowers cost for extraction of both, which wont translate to the market if profits can raise instead, which is what the relevant supplies would do initially. But this must have a long term effect, as the 'peak oil' concept was always 40years away as technically recoverable resources increased. So obvious questions:
1. does demand drive innovation?
2. does innovation drive short term prices
3. does innovation drive long term prices
4. are oil/gas prices driven by something else
I think my answers are: 1. Yes, 2. No, 3. Yes, 4. Yes
The question as to why Ukraine needs interrogation. I would recommend reading the book about PLUTO, Pipelines Under The Ocean, which is basically the birth of coiled tubing to supply WW2 units with petrol. Spoiler alert, absolutely none was supplied, but it lead to a huge interconnected network of oil supplies in the UK for the war effort and beyond. Normally over 9 months supply in place. Obviously mostly closed down now to save money. Idiots again. That would be handy to have a nice big reserve when a war breaks out. But - it was Russian gas for Europe. At the drilling stage there is little difference to most people, at the supply side it is different. So the effect on petrol, made from oil does not add up.
Currently there isn't much electricity made from oil, gridwatch seems to show 0% for the last few months. So again, why is the price of petrol so high?
Electricity could well go up, as we all know renewables are more expensive, and we still import electricity from Europe which will be affected by Russian gas supply, but this all feels too much. So is it short term profiteering? BP are doing rather well at the moment. Or is it bad policy?
It certainly seemed from the outside like marrying the PM was enough to make you an expert on energy supply. I've never met her, but I suspect like most people she cannot or will not do numbers. The 2MW wind turbine by the M4 near Reading is an example of renewables, sometimes running. Ofgem say its works about 15% of the time, I've seen some claims as low as 3%. But bear in mind 2000kW is 2682bhp, there are individual hypercars which are that kind of output. Moving things needs lots of energy. The average car in the UK is 121bhp (obviously not using all of the most of the time, 30-50bhp will get most cars along at ~60mph), so the windmill is the equivalent of just 22 cars in power terms (maybe 90 at best).
Perspective is needed before you claim renewables are the solution everywhere. I don't think there has been any sensible plan in place for the energy security of the UK.
Hi Dom, I think I can explain Ryan's UC taper comment.
If you have a given minimum income (say £1000 to make this example be easy to understand) that you are going to give someone on UC, then suppose you have a taper of 50%, then this means that until they earn £2000 they will still be getting money from UC.
If the taper were instead 25% then instead it will be until they earn £4000.
Ryan is saying that after decreasing the taper all the people earning between £2000 and £4000 will have a higher marginal tax rate than with the higher taper rate.
Why can't UC change such that there is no marginal tax rate higher than the current base rate?!
So obviously with enough other changes this would be possible but for example one obstacle to just doing this is the interaction with income tax.
The minimum standard amount is around £250 per month = £3000 per year, https://www.citizensadvice.org.uk/benefits/universal-credit/on-universal-credit/check-how-much-universal-credit-youll-get/
which means with a base rate (20%) taper UC claimants will still be tapering off UC when they are earning £15000 per year, which is above the income tax personal allowance, so at that point in the income scale people will be getting effective marginal tax rates from NI + UC + income tax. This ends up being ~50%
This will be at an even higher income level for people (e.g. those over 25) who have even higher UC payments.
So if we just reduced the taper without also changing income tax somehow, we're just changing who has the ~50% effective tax rate from the very low income to the quite low income.
Maybe we should still take the trade but there are other complications e.g. UC currently also is reduced if you have savings, so we'd also get this policy disincentivising saving for people with much higher incomes.
Apologies if I'm wrong, but is Wilhelm I a typo ? I think you mean Wilhelm II
yes sorry!
RE the business rates, going the full hog by having a land value tax on residential property could be the way to link VL working class with elements of urban working class and young. It would help to bring housing market back to reality (particularly by hitting foreign investors/owners of empty houses hard), would encourage "levelling up" and could be used to cut income tax/NI/business rates etc.
Also thanks for the focus group link. The looming nightmare of this winter cannot be overemphasised. I speak to people every day who are at the end of their tether because their benefits won't cover the cost of basic bills. I also speak to people every day who are struggling with bills even though they work, and who are saying "I should be on benefits anyway as they get all the special payments from HMT!" Numbers of people needing help are off the scale... in June and July. A very large group of malcontents being built, and when Winter bills hit + cost of Christmas it is going to go to shit. SW1 needs to wake up now if it wants any chance of avoiding some level of unrest and collapse!