A Model For Micro Finance

For the second time in a week, I was late for work following a conversation with a street “chugger.” I’m not really in a financial situation to be committing to all these direct debits (which in the past have caused me to ‘donate’ more to the banks with their extortionate overdraft charges) but I always like to hear their pitch, see what the charities are pushing and get an indication of how they’re doing. Its a bonus too that usually the collectors are genuinely interested in the cause and it always makes for an interesting conversation.

But it came to me, when making my excuses upon arrival at work, that I seem to spend far too much time defending charity. Lately I’ve found myself mounting this defence, particularly to the upper-class, ‘more experienced’ friends of my parents who generally take a sympathetic, but sceptical approach to it. Anything that you’re passionate about you will defend to the death. But if something keeps failing you have to reconsider your stance.

As passionate as a Tranmere Rovers football supporter may be, does he really believe it when he sings that his team is “by far the greatest team, the world has ever seen”? That kind of blind passion, leading the heart to rule the head is something that the developing world does not need. And constant criticism causes you to analyse your stance. If I think about charity honestly, it has a vital part to play in a lot of people’s life, but should not be considered the be all and end all. The major focus should be on development – a concept so broad it is difficult to define and effectively evaluate in a lengthy textbook, let alone a humble blog post. So following these defences my focus today is on one particular developmental concept I have some experience of – micro-financing.

Micro financing as an ideal is a fantastic concept. Small, manageable loans presented to families within a community where their services are paramount to the whole group. Where their financial advancement can encourage and inspire business and investment among the whole community. When the results yielded are positive, as they often are, then it is an undeniably great service. As such, micro-financing has been widely embraced in the developing world, but like many other great ideas in life, has been open to be exposed by the greedy and the selfish. Whilst development initiatives have, by their very nature, their fair share of hurdles to cross, the added bonus of corruption and greed is particularly unwelcome. It can inspire cynicism and retrogression, and become a significant and disheartening stumbling block.

When the weak financial systems in place in developing nations are relied upon so heavily by the vulnerable, uneducated and, to be frank, predominantly desperate population, it’s a recipe for disaster. If we’ve learnt anything about development in the last few decades, it’s that progress must not rely on the goodwill of the more fortunate. Providing a poor population with the means to provide for their own needs is the basis of all development ideals. It’s why, when successful, this concept is so great.

Unfortunately a number of micro-finance institutions (MFIs) have found that there are weaknesses to be exploited. Generally speaking, much of the developing world has been without both education and experience of money. Both of which are clearly useful when considering how to handle a loan. At the start of the micro-finance process, literacy levels are generally low (the majority of MFIs I came across used a fingerprint instead of a signature due to widespread illiteracy), moreover a prior knowledge of the notions of interest, structured repayments and banking are often lacking too.

All of this means this means that the naivety of the loan applicant is so often easily manipulated. In placing down collateral, the only option is often land and what little property they might have, which subsequently may, and often will be repossessed. Even those micro-finance organisations with a moral conscience will not be too eager to take on such high risk applicants in this ‘current economic climate.’ Especially considering that even if the applicant happens to own land, the legal system in their respective country may not have afforded them effective title to it.

A major problem is reliance on good will and a charitable nature. No-one needs to explain to people living in the third world the notion that the wealthy majority are not only willing to benefit off the poor majority, but often actively seek to do so. This international relationship can map onto power relations at a national level. Rather than inspire some sort of revolution, this injustice can encourage local entrepreneurs to follow their lead, and exploit any marginal position of power they may gain. Small, local NGOs providing micro-financing facilities often have bad reputations for corruption in poverty stricken areas due to this very process. It alienates the community and restricts the grassroots organisations by limiting funding opportunities. The powers-that-be all to often prefer larger, more trusted organisations to handle the financial resources. If one of the primary goals of micro-financing – that it should be able to fund itself and provide economic growth to an area is to be achieved, then this cannot continue to be the case.

Regretfully there are no simple solutions to this problem. We also have to navigate problems concerning the traditions and customs of poverty stricken areas. Having experienced cultures around sub-saharan Africa and southern Asia, it immediately became apparent that males are held with much higher regard than females. In Uganda for example, the stereotype of a male, head of the house, was of little assistance to the family – floundering the family’s money on alcohol and ladies of the night. The usual reaction appeared to be to accept it as being “part of the culture” reminiscent of a disability that society has managed to adapt to. It’s unfortunate, but not always a million miles from the truth, which makes a MFI’s scepticism more understandable.

It’s not in my nature, however to take such a gloomy, pessimistic view on great ideas like this and it doesn’t take much searching to find great results.

I came across a hugely inspired example of this in northern Uganda, an area still very unstable despite the near expulsion of Joseph Kony’s child-fuelled LRA. A noticeable side effect in post-conflict areas is on the male to female ratio. A side-effect, that in areas often dependent on a male breadwinner often proves very serious. In northern Uganda, traditionally women are far more poorly educated, have far fewer rights, and are considered as being of far lower standing than males. For a woman to elevate herself to the status of breadwinner requires a significant level of achievement. This societal oppression has forced adaption to long hours, tough work, and set-backs – the flipside of which is that it makes an ideal candidate to benefit from a properly executed education and opportunity for a life-changing loan. In taking this focus it can also strengthens bonds among the community. Walking though rural villages it was alarming how few adult males were amongst the hordes of children and mothers, popping in and out of random huts and sharing responsibilities amongst themselves.

The grassroots, non-profit MFI I encountered took this community element as a core focus of its work. In doing so it showed great ambition to attempt to empower women within the community. Rather than depriving resources due to cynicism of the males’ supposed spending, it encouraged groups of women to come forward and apply for community based loans. Completely blurring the lines between an advice and education centre and an MFI it followed aims that were simple enough, but each idea was thought out to benefit the community at large:

  • Acquisition of the loan requires a community based group of at least 5 people, but is open to anyone, regardless of tribe, wealth, age, social status or level of literacy.
  • All prospective applicants must be willing to complete a course of education prior to collecting the loan. It is strongly impressed on all new applicants that it is not ‘free money’ but an aid for investment, and an opportunity to build a business.
  • Only once every member of the group has been assigned a role (eg treasurer, president) and demonstrated enough of an understanding of interest, business and how the loan works, will they be eligible for the loan.
  • The whole point of a community-based loan is that there is no need for collateral. Trust is an incredibly important part of the process and works two ways. If one party cannot make a repayment then it is the other parties’ responsibility to help with repayments.
  • If a group feel that they will be unable to make a repayment then as long as they come to the office and honestly explain the situation they will be able to arrange extensions and seek assistance.
  • Once a loan has been fully repaid, the group are encouraged to keep in contact and to share their experience and the things they have learned with prospective applicants.

The organisation didn’t take long to be able to support itself through the low level of interest accumulated, and has subsequently branched off to support and rehabilitate former child soldiers, provide community based education regarding HIV/AIDS and support groups for sexual and gender based violence. It has incorporated the culture of the area and furthered the empowerment of women by arranging tribal dance and drama performances with an educational focus to school groups, whilst providing further opportunities to strengthen businesses and investment opportunities amongst the poor communities who have suffered so much in the past few decades. If this blueprint were more universally applied at a grassroots level, the development possibilities could be endless.

Slavery and the Periphery

The Industrial Revolution saw a previously unspectacular part of the world become the centre of a new worldwide economy.

To put how inconsequential Europe was in perspective we can look at agricultural productivity throughout Europe and compare this with Asia. Agriculture made up the overwhelming majority of a pre-industrial economy so the harvest to seed yield ratio [1] tells us a lot about how wealthy a pre-industrial society is.

In the 1500s the harvest to seed yield in England and the Netherlands was 7.4 to 1. This would decline as we travel out from north western Europe so that as we reach Poland this yield falls to something around 4 to 1. In contrast by the 1100s the Chinese state had induced a yield of 10 to 1.

The introduction of water power [2] and the spread of mechanical innovations in England and then northwest Europe raised manufacturing production to previously unknown levels.

In 1750 Britain had 1% of the world’s population and already produced an impressive 2% of manufactured output, but by 1860 Britain had 2% of a greatly swelled world population and produced 20% of a more than equally swollen manufactured output.

Accompanying this growth in industrial productivity was a massive increase in the demand for food and non food agricultural goods such as wood, tallow and leather tallow for building machines, oiling machines and connecting the rotating parts of these machines.

The other thing which accompanied the growth of Industrial Capitalism was the creation of slave societies on an unprecedented scale. Slavery was not something new, it had existed in western Africa for centuries and in the eastern Mediterranean Slavs had been enslaved by Venetian merchants for sugar cultivation since the time of the crusade.

In premodern economies most commerce and nearly all of day to day economic life took place within microeconomies with a radius of  around 20 mile. This was the longest distance that grain could be profitably transported and where water transport was unavailable it was nearly impossible before the railway to link these micro economies.

These microeconomies were formed of rough concentric rings with each further out ring less profitable than the last. The simpler production systems used on the edges of this economy imply a lower level of Smithian specialisation and lower productivity per worker.

With the advent of industrial production and cheapening of mass transport the limits of profitable agricultural production was pushed out and out until it reached North American, the Caribbean and even Australia.

I “clashed” with Thomas Byrne on the benefits or drawbacks of Fairtrade and I found these von Thunenian zoning useful to explain how trade with an industrial centre will cause inequality as described above, rather than inequality merely being a residual of a premodern world.

This spatial inequality in the uneven world of the 19th century may have helped feed England’s Satanic Mills but it also induced the far greater evil of slavery in Europe’s colonies.

To see why we have to look at the failure of these colonial economies to attract labour from across the outermost ring of our agricultural zones. Beyond the very least profitable zone, where transport costs make even wheat produced on almost free land too expensive to ship, is the subsistence zone.

In this zone labour is free to migrate and produce enough to live even with only minimal contact with the “civilised” world and there is little incentive to cross the subsistence barrier to take up wage labour at a lower rate than that available through subsistence agriculture.

We can see why slave labour becomes “better” than wage labour in this situation by looking at the difference in luring labour across the subsistence barrier in low land-to-labour and high land-to-labour situations.

In a high land-to-labour situation a worker can migrate across our subsistence barrier and establish a self sufficient lifestyle outside our production rings. With the existence of this option, to lure workers to our agricultural zone the needed wages exist

Whereas in north-western Europe, our low land-to-labour situation, productivity in the subsistence zone is so low that any subtraction of workers from this zone to work in our agricultural zones does not diminish total production in the subsistence zone. The wage needed to attract workers is therefore very much lower than in our above example.

In the newly emptied New World there were relatively few people occupying a huge amount of land. For a long time it was impossible to enforce European style property rights over this land; it was impossible to use force to disposes those present as the peasants had been expelled from their homes in Europe.

This meant that the cost of voluntarily attracting labour to these zones was very high – and once there is was prone to set up farm on its own. Consequently this made slaves and indentured servants by far the cheapest option to encourage production in the New World.

The vast slave movements across the Atlantic, the convict shipments to Australia and the indentured servants from Asia all helped feed the industrial revolution the raw goods which it demanded.

Slavery was very much central to the creation of a modern world economy and there is no way Europe and later North America could have satisfied their thirst for raw materials without it.

Slavery only stopped being necessary for production in this outer zone once the state had been successful in creating a land market past the frontier of our subsistence zone. A market in labour presumes a market in land to prevent exit. By parcelling out land labourers were forced to find work on the market.

In the New World the violence of the state and its ability to commodify land enabled the creation of a low land-to-labour world which would otherwise not have existed. This transformation was more successful in the north eastern part of the North American continent than it was in most of Latin America with massive and unequal consequences for the development of each.

[1] This figure is the number of grains harvested to one planted. For example a harvest to seed yield of 4.5 on a field scatered with 1,000 seeds would yield 4,500 seeds as harvest.

[2] Steam power would later be introduced too of course. However, the importance of steam is usually overstated and that of the humble water mill too often overlooked.

With much gratitude to Hermann Schwartz and his excellent States Versus Markets.

A Referendum on a English Institution

We know that there are roughly 8,000 French people in our country. Their ways are odd but we tolerate them. We are a tolerant people, even to towards those rude, petulant and ungrateful cheese eating surrender monkeys.

Although there can of course be no problem acknowledging the right of the French to practice their own lifestyle in private, I think we would all agree that the growing “Frenchification” of our society is worrying.

This Frenchification does not manifest itself in anything as petty as food, language or history. No, but it is visible clearly everywhere as a threat to our way of life. I am of course talking about the inability of the French to queue.

We’ve have all been to the local Asda Wal-Mart to buy some West Country Butter Croissants or Yorkshire Dales Brioche when we are rudely ambushed by a Frenchman.

In fact, those of you who have been to France will know that they do not allow you to queue there, you are expected to huddle and push, like some sort of Frenchman. If they will not us allow to queue in France then we will force them to queue here.

Therefore I am asking for the signature of 100,000 bloggers to help spark a referendum that will send a message against this demographic time bomb. We must force the French to queue, or they will force us not too.

You can stand there and take no action but by 2030 it is possible that no one will queue at all. Don’t let Gordon Brown steal the gift of queueing from your children.

We do not wish to impose on the French residents in this country, they are welcome to practice their Frenchness here at will. But this is our country and we will not stand – in an orderly line – for this!

Hypocrites

Welcome to Faisal Private Bank, the first Swiss bank exclusively dedicated to innovative wealth and asset management in accordance with the principles of Islamic finance.

With Faisal Private Bank you will benefit from a banking model that is highly personalised, global and competitive; the result of our deep experience in the Swiss private banking sector and our unique ethical heritage.

GOOD Islamic Practise.

The SVP used the [referendum on banning the minaret ] as an assault on what it depicts as the inroads of political Islam in Switzerland, including Sharia practices and oppression of women. “We just want to stop further Islamisation in Switzerland,” Walter Wobmann, head of a committee backing the initiative, said after the vote.

BAD Islamic Practise.

It appears the Swiss are only keen on banning some “Islamisation.” You know the stuff you can ban to keep migrants and minorities in their place but which doesn’t lose you any money.

Switzerland has decided to send a message and message is loud and clear! No Islamification, except where it is profitable!

The principles of Islamic finance are somewhat differnt to the finance which we are used to.

In Islamic banking the payment of interest fees is forbid, as it  investing in businesses that provide goods or services considered contrary to its principles. There are lots of other rules, but you can research those yourself.

For example you cannot provide a loan of £10,000 payable at 10% interest per annum  over a 30 year period to a Sausage maker. However, you can offer to buy someone a house for £200,000 and have them pay you back £300,000 over 30 years instead of charging interest.

The arguments against the building of Minarets all tend to fall down once a careful look is taken.

The referendum cannot have been about disturbance caused by the call to prayer issued form Minarets, as that is already covered by noise pollution legislation.

Nor, could it be about the imposition of Minarets of the rural idylls of Switzerland as local planning laws could stop unwanted Minarets.

Neither in the light of the presence of Islamic finance is it a backlash against some phantom “Islamisation.”

Unfortunately Switzerland has reached a point where building a Minaret is the height of imposition. However, running a bank based on Sharia principles is not.

The only place where Sharia law is practised in Switzerland it appears to have been welcomed. However, a small number of minarets built by law abiding citizens and residents appears to be a step to far for the Swiss.

The Limits of Democracy

Swiss voters have supported a referendum proposal to ban the building of minarets, official results show.

More than 57% of voters and 22 out of 26 cantons – or provinces – voted in favour of the ban.

Democracy; it’s a funny old thing. The democracy which we endure is somewhat different to the democracy which the one the Swiss enjoy. [1]

Referenda are rare in British democracy whereas they are common in Switzerland. The proposed and withdrawn referenda on the EU constitution and Lisbon Treaty reflects the fact that constitutional change is one of those issues deemed serious enough to demand a democratic mandate only a referenda can deliver.

However, in Switzerland a referendum on any new piece of legislation can be held if the sponsor collects 100,000 signatures from the citizenship in the 18 months following its introduction.

So long as a plurality of voters in more than half of Switzerland’s 26 cantons then vote yes, the new bill will be signed into law. The opposition Swiss People’s Party have earned the ire of the Government by introducing the Bill to ban Minarets this way.

There democratic credentials of this referendum seem clear, after all this was no close run thing, more than 57% of voters and 22 out of 26 cantons voted “yes.”

Yet despite all this, banning one particular sort of building seems spectacularly undemocratic. When it is accompanied by a rise in Islamophobic violence, it seems down right authoritarian.

Guthrum over at Old Holborn is managing to do a great disservice to Libertarians everywhere by holding up this as an example of democracy in process.

Bizarrely he concludes with “The people told the Government, not the other way round” when in fact what has happened is the “the people told some other people to stop doing “that”.” Moreover, the told them to do it by co-opting the massive repressive potential of the state.

Paul Sagar has an interesting post on democracy and argues that while democracy is a process and a system of Government, it is also a value. It is assumed that democratic is always better than undemocratic.

However, a democratic outcome is not always better or more legitimate. I once saw Shami Chakrabarti of Liberty speak and she compared democracy to an engine. There are moving parts driving the vehicle forward but there are also parts that must remain stationary for the engine to function.

Our judiciary is not democratic in the majoritarian sense and trials will not and should not be decided by referenda. Even if public outcry demand one outcome it is still right if the opposite decision is delivered.

While it is entirely possible to decry the banning of the building of Minarets but accept that it is democratically sound, I don’t think it must be inherently democratic simply because it was a decision returned by a referendum.

There as some things in a democracy more fundamental than simply voting for representatives or in referenda. There are preconditions, without which voting would become a meaningless adjunct to a repressive system of Government.

For example, equality before the law is essential, as is freedom from arbitrary detention. Freedom of conscience is necessary for the plurality of opinion a democracy needs and freedom of association is essential for organising that plurality of opinions.

Before a democracy can function certain preconditions must be met. To be a follower of a legally censured religion is damaging to these basic freedoms that form the foundations of democracy. No majority vote can rewrite the preconditions necessary for a democratic and free society.

As Benjamin Franklin didn’t say: “Democracy is two wolves and a lamb voting on what to have for lunch. Liberty is a well-armed lamb contesting the vote.”

[1] Enjoy, that is, so long as you are not a Muslim architect who’s just been put out of work.

Much, much more discussion over at Liberal Conspiracy.

And all this extra reading too.

One of the most wrongheaded posts I have ever read

“So few blogs tackle this subject area. Good stuff” “Hallejah. This subject tackled factually for once.” “Let’s hope that the Conservative Leadership read this blog piece and these suggestions make it into the manifesto.” “One of the best blog posts I have read on immigration. Hat tipped”

All comments on this blog post from Matthew Jeffer of TrueBlueBlood.

I rarely stray into the Tory blogosphere and when I do read right wing blogs they tend to be Libertarians or classical liberals like Devil’s Kitchen, Tim Worstall or the blogs of the writers of the Economist. Neither am I particularly keen to start a flame war or to start using the ad hominem style sheet of Harry’s place.

However, since Thomas Byrne linked to my post on the non-problem of a 70 million population I found this post titled The shocking truth about immigration… THE subject politicians don’t want to debate! and had to comment too.

Yes.  I am raising the one topic that Politicians don’t want to discuss….apart from the BNP!

And no….Immigration is not about race/colour/nationality……it is….a purely economic issue.  Yes.  ECONOMIC!

Immigration is the great taboo subject. The moment it is mentioned, the race card is immediately played.  Speak about restricting immigration into our nation and the ‘left’ immediately invoke the term ‘racist’ and reference someone as being a card carrying member of the BNP.  Hence, real debate is immediately stifled! We deserve better than this.

And yes, immigration is hard to discuss for Conservatives without having the spectre of Enoch Powell’s ’Rivers of Blood speech’, being submitted as a battering ram against any sensible discussion or argument.

So this blog article is looking at immigration and how sustainable UK entry levels are in a recession, with a strangling, cancerous level of public debt, spiraling unemployment and massively overstretched public services….. and presenting facts for your thoughtful reflection.

and so on… Perhaps I’ve been reading Jamie Sport‘s output for too long but I assumed this was a parody from the outset. From THE hyperbolic title to the Littlejohnesque fear of the “race card” it was all there.

However as I moved on I realised that this was not a parody but merely one of the least accurate and most misleading blogposts I had read in some time.

This post contains a litany of errors on migration and yet it appears to have garnered enough attention to warrant 8 comments (not all positive however).

Sadly it is not rare to find so many untruths, misleading statistics written on the subject of immigration, but it is rare to find so many in one place.

First of all Matthew wants us to believe that this is a subject no politician wants to speak about. This is a meme propagated by some quarters of our press and is utterly devoid of truth.

New Labour have passed a huge swathe of legislation, creating 1000s of new offences. However passing five acts on migration is a fairly good indicator that it has not been the one topic that politicians do not want to discuss. When Gordon Brown demanded “British Jobs for British Workers” he was of course talking about immigration and one look at Michael Howard’s 2005 manifesto will illustrate just how central immigration is to our politics and our politicians.

The claim is also repeated with respect to blogs. Its a funny time to make a claim like this when Liberal Conspiracy are in the middle of a series of posts on just this subject.

Matthew argues that we should not “sleepwalk to 70 million people in the UK.” I have one very simple reason to ask, why not? He argues that our public services struggle with 56 million people and yet a big reason for this was more than two decades of underinvestment by the Tories, not just migration. As I’ve argued here, the increase of our population doesn’t have to mean crowding, or the creation of 7 Birmingham.

Bullet points are his preferred style which luckily for me, and unluckily for him, makes critiquing his post so much easier.

  • Housing (limited housing stock and depressed housing market, lack of money to build new houses) Matthew’s answer is to keep out all those Polish builders, plumbers, plasters and hard working immigrant tax payers.
  • Jobs (rising levels of unemployment, not enough jobs to go round) The Lump of Labour Fallacy, see here, or here.
  • State benefit system (already overstretched with unemployment benefit rising and depleted exchequer revenues) Migrants are not able to claim most of the benefits which UK citizens can, in fact they make a net contribution to the Exchequer. Even MigrationWatch UK don’t deny that fact.
  • Health service (stretched to the bone, not enough beds, increasing waiting times) The NHS would have collapsed in the 1950s without West Indian Nurses and it would collapse today without our highly trained and effective foreign Doctors and Nurses.
  • Education (already cuts in University funds are seeing students turned away, pressure on schools and classroom sizes) This is nonsense, foreign students in fact subsides the education of British Nationals with their exorbitant fees. There’s a post here Matthew may be interested in.
  • Travel infrastructure (Decrepit roads at a standstill with overwhelming traffic, trains creaking–need for money and public not incentivised to travel on any form of public transport as poor service and very expensive) Somewhat irrelevant from the debate on Migration but subsumed within the the “Swamping Public Services” argument. When migrants maintain roads you have to wonder if booting them out is a good idea, and you cannot blame migrants for rail privatisation.
  • Environment (building more houses in the countryside, growing pollution, more cars on the road, more wasteful emissions and wastage occurring) This is an argument for keeping the poor poor, because the poor pollute less. While correct that a migrant living in the UK will pollute more than one in rural Mozambique this is a morally repugnant argument. While trivially true this is no guide to policy in any society which wishes to think of itself as just.
  • Depleting energy resources (more people using more and more resources, speeding their depletion) See above.
  • Social Fabric (how differing cultures seamlessly blend in stressful recessionary times and live harmoniously) Given the range of untruths displayed above, I would ask Matthew to consider who is damaging the Social Fabric more, immigrants of him.
  • Net immigration has quadrupled since 1997 to 237,000 a year.  Yes New Labour have failed to get a grip on this They passed 5 acts and were the only country to not slap arbitrary restrictions on the A8  accession countries. I’m proud of our liberalism but I will concede that Labour didn’t make the case in favour of migration, but you cannot accuse them of inaction.
  • This means a migrant now arrives nearly every minute….yes every minute This is a funny way of discussing this topic, especially considering you wrote an inch above bemoaning “emotive propaganda”
  • Immigration will add 7 million to the population of England in the next 20 years – that is 7 times the population of Birmingham. See above on “emotive propaganda.” It “will” not add 7 Birmingham, it “may” add 7 million people and in an ageing society this is not inherently a bad thing. It will also not add 7 Birmingham, it will add, spread through the country, “some” people.
  • By 2008, almost one in nine British residents (6.5m) was born abroad. So? My dad was born in Venezuela, while my Capitalist Pig Dog Welsh Granddad exploited the countries bounties of oil for Shell. Without examining the figures you’re counting a lot of people who are as “British” as you or I.
  • Some estimates show that we must build a new home every six minutes for new migrants. And it is Polish Builders, Latvian Electricians and Czech Plasterers doing it. They probably help to build “British homes for British people” too.
  • Much of the increase of immigrants has come from residents of the “A8″ countries that joined the EU in May 2004 – the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Slovakia and Slovenia. And look what has happened to this migration (H/T Left Foot Forward) Yet you don’t mention this.
  • Of these, two thirds were Polish, making Poland the third most common country of birth for immigrants living in Britain, after India and the Republic of Ireland. Interesting, so?
  • The latest government household projections show that immigration will account for 39% of all new households in the next 20 years. Again, so?
  • England is already the most crowded country in Europe (except Malta) But we live in the UK not England. If you want to chop and change statistics feel free, but I will only point out that the German Land of North-Rhine Westphalia has a population density 33% higher than that of England.
  • To keep the population of the UK below 70 million, immigration must be reduced by 75%. So say Migration Watch UK, but you have not explained why it needs to be kept below 70 million.
  • Asylum immigration, (much loved by the tabloids), only runs at 10% of net immigration, (30,000 per year) True, and out of a global refugee population of 42 million something tells me we’re not pulling our weight.
  • There are more than 300 primary schools in which over 70% have English as a second language; this is nearly a half million children. But at what level do they speak English? Children are linguistic sponges and the statistic you quote do not prove that 70% of children who speak English as a second language speak English in a way damaging to the class as a whole.
  • In London, which has long been home to immigrants from all over the world, one in three residents was born abroad by 2007. In the boroughs of Westminster and Brent, there are more foreign-born people than Britons. So?
  • Growing level of illegal immigrants, (classed as those who enter illegally on the back of a truck, visitors and students who overstay their visas, and rejected asylum seekers who the authorities fail to remove.  In March 2009 a study by the London School of Economics suggested a central estimate of 725,000 of which 518,000 were thought to be in London. And so the argument that an amnesty be granted is all the more overwhelming, especially when we can hardly afford the £11,000 it costs to catch, try, and deport an undocumented migrant.

Citing a House of Lords document Matthew approvingly quotes: “We have found no evidence for the argument, made by the government, business and many others, that net immigration – immigration minus emigration – generates significant economic benefits for the existing UK population.” As regards the contribution of migrants to the Exchequer, they concluded that “The overall fiscal impact of immigration is likely to be small, though this masks significant variations across different immigrant groups.”

It is almost impossible to convincingly argue that migrants are economically detrimental. This paper explains some of the reasons why (H/T Chris Dillow).

Giovanni Peri shows (pdf), from looking across US states, that migrants are good for the economy:

We present three main findings, two of which are quite new in this literature. First, we confirm that immigrants do not crowd-out employment of (or hours worked by) natives but simply add to total employment. Second, we find that they increase total factor productivity significantly and, third, that such efficiency gains are unskilled-biased—larger, that is, for less educated workers.

Matthew also chooses to ignore that fact that while the UK population’s wealth and the UK’s Exchequer’s revenues are, at worst, unaffected, the quality of life of the migrant is massively improved.

Needless to say he blames Labour for the increase in net migration we have seen over the last two decades. I prefer to argue along different lines.

First of all as discussed here, asylum applications are closely correlated with armed conflicts. Labour could – and should – have fought less wars but there’s little they could have done to prevent the collapse of Yugoslavia.

Secondly, UK plc has been experiencing one of the longest economic booms since the war and that has produced a demand for workers, and there exists a supply only too willing to meet it.

Thirdly, the UK is a fantastic place to live. Compare your life now to that of the other 99% of humanity that came before and you will realise just how lucky you are to live in the UK right now.

When a migrant sets up home here it is a compliment, accept it, don’t write blog posts pretending they’re the cause of societies woes.

From his faulty information and flawed assumptions Matthew then goes on to provide some policy recommendations for Dave.

  • Seize the moment and seize the issue. Cameron should address immigration with a clear policy.  This will be popular amongst voters but also make a difference to the economy.  A vote winner. Same Ole Tory policies then?
  • He should propose we stabilise the current population level to what it is,  (stabilise by balancing immigration & emigration).  Not approach levels of 70 million. But you have not argued why this is a bad thing, there is no logical route from what you have written above to this policy.
  • Propose we set an agreed target range for immigration and keep to it, (much as other countries do) eg say 20,000. This will cap economic growth below its potential, in a massive recession and with a large hole in the countries coffers we really don’t need to arbitrarily limit the labour supply.
  • Propose stronger border controls and increased investment to prevent illegal immigrants. Fair enough, but remember, this will be expensive and it will reduce the potential for economic growth to pay for it.
  • Propose the UK cap the level of work permits.  And increase the number of points needed to settle here, (hence aid economic recovery). See above (Hence, your policies will not aid economic recovery).
  • Propose the UK cap the number of students immigrating in to study in the UK. Not only will this unnecesarily limit the amount of UK students who can study, it will also damage economic growth as the University Sector is somewhere where we are internationally competitive and is a big earner for the UK.
  • Whilst asylum is low in proportion, propose measures to deport those who cannot demonstrate the need for true asylum. Again, an expensive move when you are trying to limit economic growth. Roughly £11,000 a head. At circa 700,000 we are talking serious money. Also something which Labour since 1997 have been better at than the Tories were when they were in power before.
  • Propose measures to remove illegal immigrants.  Easy to say but hard to empower.  Start by massive punitive fines to employers of illegal immigrants. See above.

Unfortunately TrueBlueBlood has strayed into what Kevin Arscott of AngryMob has coined as Tabloid Blogging. In this piece there is the same over reliance on easy to understand soundbites and the same carefree disregard for the facts as you would find in The Sun or The Mail.

It is obvious that Matthew Jeffer takes the subject very seriously, and he is right when he says that “immigration is a HUGE concern to the British people” but I don’t think Matthew realises that he is partly the cause and the not solution to that concern.

Left Wing blogger in rage at Daily Mail shock: Updated

Its hardly news is it? The Daily Mail’s readers are reactionary bigots.

However, just how shockingly hateful they are is hard to comprehend until you’ve seen their reaction to the death of an immigrant. You worry as soon as you see the title: Migrant found dead in the back of a lorry as it prepares to enter Channel Tunnel (H/T Five Chinese Crackers and Tabloid Watch). But what follows is one of those articles that reveals the Mail does have writers who can write; its not vitriolic, its not angry, its even vaguely concerned. Its the comments that really shock. By now I know they shouldn’t, but they do.

Saved us a house car and free money then.
– martyn robinson, northampton uk, 31/10/2009 09:12

one down, millions to go
– crackers, yorkshire, 31/10/2009 2:42

Good news. One less to worry about!
– keith jones, porthcawl, south wales, 30/10/2009 22:13

Shame but I would be a hypocrit if I said I was sorry!
– Nanny B, West Sussex, 30/10/2009 17:42

At least 115 people have clicked on the green “up” arrow for that top one. 115 people think that this immigrant is better off dead because he was after a “house car [sic] and free money then.”

Mark Twain said that a “lie can travel halfway around the world while the truth is putting on its shoes” and it seems Carol Malone‘s lie that immigrants are given cars is one of them.

The Mail creates an atmosphere where displaying joy at someone’s death seems appropriate. Often its said that The Mail merely reflects it readers views, and to an extent its true, however The Mail will always run up against a problem. Immigrants aren’t that bad.

Sure some are illiberal nut jobs, but I don’t see anyone arguing for Melanie Philips to be deported (well I do… but that’s besides the point) and some do “scrounge” but the vast majority do not.

In fact, economically they bring benefits, that’s pretty hard to argue with, I’d say impossible. The culture, music and food – especially food – that they bring enriches this country, you’re entitled to disagree but remember this. You’re wrong.

So to get round these simple truths the Mail regularly lies, distorts and misleads, ask Nick Davies if you want to know more. This is the end result. This is the real “Broken Britain,” but I don’t imagine I’ll see much about it in anyones manifesto. Apparently hate sells and more hate gets you elected.

Updates from Five Chinese Crackers.

**UPDATE** It’s lunchtime on Monday, and I’ve been checking in now and again, watching as the comments get red-arrowed by the more sane.  One seems to have been deleted, but it’s not possible to tell which one since the option to view all comments has been disabled.

**UPDATE UPDATE** A few minutes later, and the comments are down to 5.  I can’t imagine they’ll all be there by the end of the day, since ‘One down and quite a few to go’ is still there.

**UPDATE UPDATE UPDATE** Quarter to four and they’re all gone.  Phew!

**UPDATE UPDATE UPDATE UPDATE** Now two are back.  Including my favourite one about trucks not being searched at border controls.  Genius.

It appears the Mail may have realised not all those visiting the site are frothing racist mouth breathers and have removed some of the content. Wouldn’t want the advertisers taking fright.

Just in case any advertisers were interested in what the Mail chooses juxtapose with their material, there is a picture here of the comments in question (H/T Y Dysgwr Araf and Nic Dafis. Cymru am byth!). Delightful I’m sure you’ll agree, really puts me in the mood to buy stuff.

Courtesy of Y Dysgwr Araf

Courtesy of Y Dysgwr Araf

Give ’em enough rope

The BNP leader Nick Griffin gave a ridiculous performance on Question Time, it seems too soon to really take stock of what happened, but it looked like car crash from where I was watching.

Later on This Week, Diane Abbott mentioned that it may not look so embarrassing outside of multicultural London, but I’m not so sure. Someone pretending it is illegal to explain their views on the Holocaust doesn’t go down well anywhere.

Neither do I think he looked bullied, everyone was just in shock at the nonsense pouring out of his mouth.

The only weak part of the evening was when the evening turned to immigration. Labour, Lib Dems and Conservative MPs all tried to talk tough sat opposite Nasty Nick.

Has the Government position on immigration helped the BNP? It depends if 5 acts in 12 years is not enough for you. It depends if removing all legal entries to the UK for asylum seekers is too soft for you. It depends if you think immigrants paying 37% more in tax than they claim in benefits, as they did last year, counts as scrounging.

Perhaps the Government has helped the BNP, but not in the way they think it has, judging by the answers given tonight.

Luckily Nick Griffin is a moron, no racist can look otherwise. Give the man enough rope and he’ll hang himself, give him enough airtime and he’ll tie himself in knots.

Platform the Bastard, he hasn’t got a chance.

An Open Letter to Libertarians and Socialists

A spectre is haunting the blogosphere – the spectre of Libertarianism.

Nothing would please me more than to give in to its haunting charms. Libertarianism is neat, it is consistent and it is beautiful. Its economics are marvellously simple; a tidy web of self-interested individuals reaching an equilibrium and prospering.

People can exchange what they have earned for what others have created, and through this voluntary exchange everyone ends up even more prosperous than before. Ad infinitum.

When pure, Libertarianism is consistent too; drugs are yours, as is sex and smoking indoors, so long as you don’t coerce anyone to get hold of them.

Those “without” go with what charity can provide. Those “with” keep it, because there are no grounds for removing it; you own yourself and what you produce. Because when people are free they produce fabulous wealth those without become less and less numerous, and the burden on charity becomes less and less burdensome.

However, like a rubber sheet loaded with a lead ball, Government distorts and tangles this beautiful web, drawing prosperity towards its own centres of gravity and will eventual tear a hole in it.

The only thing that’s warns me away from this beautiful web is the overwhelming body of evidence in favour of Socialism.

Libertarians

Now that I’ve set up the straw man, it is time to flesh him out so that I can explain what I really mean.

As mentioned at LibCon, some people really don’t get Libertarianism and I don’t want to talk about morons like Roger Helmer – Bella Gerens explains what a real Libertarian is to her. No, it is Charlotte Gore, our humble Devil, Mr Eugenides, Tim Worstall and The Economist that I need to challenge.

First things first

The economics of Libertarianism are not what got us here. The world is fabulously but it isn’t the free market that got us here, it was a hobbled, chained and unfree market.

England, Hong Kong, Singapore. I’ll admit that these are the places which got to where they were mostly by the free market, however each is unique in its own way and has little to teach us.

Germany, America, South Korea – in fact, the rest of the rich world – got to where it is today by ignoring Libertarian fantasies and by embracing some form of blatant non-market intervention. This is where there are lessons for those that really need them.

Germany didn’t lead the second industrial revolution when the state “got out the way.” It became an industrial leader when state created entrepreneurs set up businesses and state sanctioned banks created credit for strategic industries.

America is not a free trade nation and never has been, it is the home and bastion of protectionism. It built up its industries not in competition with Britain, but with intense protection from her output.

South Korea’s firms did not compete against each other under the careful eye of a night-watchman state. These firms were arranged into giant chaebols, they were infected with nepotism and were deep in the pockets of Government, yet it produced one of the great miracles of the 20th Century.

Property Rights

In an argument atypical, perhaps anathema, to some Libertarians Tim Worstall argues that…

…creators have rights over their creations because we want to encourage the next creator to create. Nobody gives a damn how much effort goes into creating something, the labour used or indeed any other resource used. All we actually care about is encouraging more people to create more things: and to do so we reward those who have created.

In essence, Tim’s argument is that intellectual property rights – and by extension, all property rights – need to be protected because they make us all better off. By working backwards from results to the system which yields them, Tim gives us the classic Libertarian argument that respect for property makes us richer.

This argument is well worn, although usually presented in a completely different. For most Libertarians property rights are sacred because what you produce is yours, and what you buy with that is as much yours as if you produced it yourself. Tim inserts the proviso that it is also the best way to get the results we all want.

However it is not nearly this simple, sometimes property rights can get in the way of wealth creation, no simple Libertarian rationale will cure what ails us.

Enclosure involved stealing land from those who owned it in common. Yet it helped kick start the greatest wealth creation in human history.

Ignoring or not granting patents on medication has helped increase the quality of life for millions of Indians, and others around the world. The research into treatments and cures continues.

Directing tax revenue towards strategic industries can be beneficial. When the tax revenue of South Koreans was directed towards the manufacture of Microwaves it was neither an area they specialised in nor one which returned a profit. However, they soon became market leaders and the welfare of all was increased.

Property rights don’t need to be treated as a sacrament, in fact it can be damaging to do so.

Beyond Economics…

… Libertarians are generally right.

  • Huffing on a crack pipe? Your choice, a drug’s illegality only makes it more harmful.
  • Girls Aloud murder porn? Your choice, banning it only drives it underground.
  • Smoking in a pub? Your choice, surely this one doesn’t need an explanation.
  • Want a divorce? I won’t force you into a “cooling down period.”
  • Fancy a pint or ten? Sod it, I’m heading to the bar myself, I’ll get them in.

So long as you don’t hurt anyone else, do as you like. But for not one second does the evidence suggest this is a good guiding principle when it comes to economics.

The evidence around us in  points to a system of economics and a vision of the good society that is markedly differnt from that presented to us by Mises or Hannan.

And the Socialist shall lie down with the Lambertarian

Socialism as I understand it, is the only way to a better material existence and a more free life for all of us. A smaller state can be compatible with Socialism, and social liberalism has long gone hand in hand with the left, Socialism is not anathema to what Libertarians want. So join us.

This is our rallying cry. Bloggers have nothing to lose but the chains of an ideologically consistent viewpoint. They have evidence based policy to win!

EMPIRICALLY MINDED SOCIALISTS OF THE WORLD, UNITE!

Socialists

Mr Eugenides, Devil’s Kitchen, Tim Worstall (you’re a classical liberal, I know, but sadly there’s no CLPUK), Charlotte Gore, Thomas Byrne, Dave Semple, Chris Dillow, Paul Sagar, Paul Cotterill, A Very Public Sociologist, Will Straw, Paul Krugman and Steven Levitt you are my favourite Socialists and Libertarians and this letter is directed towards you. Discuss.

Further Reading: A Memorandum to Libertarians and Socialists: Part One

Even Further Reading: A Memorandum to Libertarians and Socialists: Part Two

A belated reply to Giles Wilkes on China

I wrote a piece shortly following the publication of the Tory’s One World Conservatism on how it was full of crap.

The recommendations of this paper were not particularly different from the policies of our current Administration. Of course it continued within the dreadful framework of the post-Washington Consensus (and therein lies the problem).

I divided my discussion into several subtopics for easy navigation, as it ran to some 3,000 words.

Contradictions, Choosing Winners and Losers, Gimmicks: “Bhutan’s got Talent”, Turing up in pair of flip-flops offering to build a school, Vouchers, Microfinance, Rejecting Universal Education, Rejecting Universal Healthcare, Fixation on Private Sector Wealth Creation, The Sanctity of Property Rights, Fighting the Wrong Battles, Some good points made it though

One topic provoked particular criticism from Giles Wilkes of freethinkingeconomist and CentreForum fame.

China-60.svgUnder the heading “Choosing Winners and Losers” I criticised the Conservatives for withdrawing aid from China despite it still being particularly poverty stricken. The offending paragraphs follow below.

China and the Chinese are often treated as a political football. Those wishing to vacillate on Climate Change can use China’s pollution as an excuse to do nothing.

It appears that the suffering of the Chinese people in sweatshops, mines and factories is now to be rewarded with a banner which reads “Mission Accomplished.”

Please allow me to put this move into perspective, in 1750 England’s GDP per capita (likewise measured in 1990 dollars) stood at $1,328. In 2006 China’s per capita GDP stood $128 below this.

Today, on the brink of the worst global recession in a generation, China’s GDP pet capita is still only half of what the UK had achieved by the end of the 19th Century. The Tories announce that “Every life is precious” but when those live are collectively labelled “the People’s Republic of China” their well-being becomes a necessary sacrifice.

Giles contends that he “smells a rat.” He argues that I am ignoring the clear differences in Purchasing Power Parity (PPP) that exist between modern China and Victorian Britain.

I start with Angus Madison’s data.  In “1990 International Geary-Khamis dollars“, he has China’s GDP in 1800 at about $600.  Two centuries of woe, caused by both internal and external factors, as well as the disasters of totalitarianism, mean that it is still around $600 in 1960.

There is SOME growth to 1980, bringing us to $1000, but then the new freedoms growth starts motoring from a change in ideology. By Madison’s data, this puts Chinese GDP in terms of 1990 dollars at over $4000 in 2003 – in line with IMF figures. In terms of Purchasing Power Parity, it has grown even faster, to $8500 – reflecting, no doubt, the strengthening currency – from $248 in 1980.

Purchasing Power Parity probably explains much of what Left Outside has Left Outside his analysis.  It is what counts in this sort of discussion: what matters is how much you can get for your buck, not the state of international markets in tradeable items.

I have to accept that I was playing a little fast and loose with the facts in my last post. Giles excellently underlines what was “Left Outside” of my post, however the point I was trying to briefly outline remains valid. (Hopefully only slightly wounded by my slapdash short hand argument.)

Left Wing Imperialism

However, Giles oversteps the mark when he accuses me of “Left wing Imperialism.” He is wrong to do so on a number of counts, however for brevity I will try to limit to discussion on China’s relative wealth and poverty. More general discussions on aid and global justice along Marxist, Rawlsian and Humanitarian lines will have to wait for another time.

No one is going to argue that China’s per capita GDP is not still very low. Using the IMF’s Data Mapper China’s 2009 per capita PPP GDP at current international dollars is $6,546. As Giles argues this is significantly more than our Victorian forbears, however the structure of China’s society makes this simple fact increasingly difficult to map onto concrete reality.

Firstly, I would like to turn to Dave Osler’s recent post on Soft Sinophilia, mainly because it caught my eye recently, but specifically because it addresses an important element of Chinese society.

The sycophancy of many on the left to China’s dictatorial, murderous, exploitative, repressive and capitalist rulers is peculiarly disturbing. While China’s GDP has soared since 1978 the results have clearly not led to as widespread a rise in living standards as could be expected. Speaking about a contemporary calculation on the rate of exploitation Dave says…

…perhaps the closest equivalent metric in mainstream economics is the overall wages bill for a given country, expressed as a proportion of gross domestic product. This is, crudely, the workers’ share of the social product. Even despite the onslaught of neoliberalism, it typically amounts to around 55% throughout western Europe.

But a recent study by Chang Xiuze, an economist with a National Development and Reform Commission think tank, revealed that the salary component of China’s GDP dropped from 17% in 1980 to just 11% in 2007. In other words, the bosses are taking a dramatically greater cut.

It appears that the Chinese are getting a smaller cut of a bigger pie. Some would argue that this is a good thing if the pie is big enough, I would argue that this is a sign of the failure’s of China’s economic model and this sort of imbalance will lead to massive problems soon.

Furthermore, Giles argues that the health of the Chinese is one of the most obvious ways in which modern China is a better place to live than Victorian Britain. However,  as always in China it is far more complicated than that.

It is mostly agreed that “wealthier is  healthier.” However, evidence from China is doing a great deal to prove that the form of society and social institutions matter a great deal for how much healthier a society gets for its wealth.

In this paper form the New Left Review (gated) evidence is provided that shows that China is getting healthier far more slowly than other comparable countries as they got wealthier. Again, it appears that the Chinese are getting a smaller cut of a bigger pie. I don’t think this is good enough, because evidence exists from other countries that it can be done better.

According to this report from the UN Development Programme 15.9%  of China’s population live on less than $1.25 a day and 36.3% live on less than $2, my preferred metric. This is the sort of Dickensian poverty which can be missed if you insist on looking at the number of skyscrapers going up in Shanghai.

When you insist on looking at the number of skyscrapers you can be so awestruck by the shear scale of the things that you fail to notice that up to half of the commercial property in the city sits empty.

This dislocate is what interests me. China is no nut, but the sledge hammer that is being used to crack this society is massive.

Football

While I concede that Giles makes some excellent points I find his casual dismissal of my argument that “China and the Chinese are often treated as a political football” somewhat bemusing.

First of all, there is the historical context. In 1949 Mao’s forces declared the foundation of the People’s Republic of China. In the West this was not treated as a mere violent change of government. Repeated, again and again, was the idea that “we have lost China.” We was the West and implicit in that statement is that China was ours to lose in the first place. The fall of China became a central plank of anti-Red hysteria throughout the 1950s and onwards.

China’s many economic successes are used to underline how powerful the development consensus of free-markets and free-trade is.  It is responsible for the majority of those lifted out of poverty in the last few decades. Dani Rodrik argues that China’s development path could hardly be further from the consensus of the last 30 years, and he is right. However, when some argue that it is bogus to include China’s growth and poverty reduction when discussing global poverty reduction strategies they are described as trying to stage “Hamlet without the Prince.”

And the Tories. They want to act tough on aid by cutting help to China. Despite  the dubious ground on which they stand for cutting aid to a country with such manifest problems they were applauded by the right of their party. 60 years ago, 6 years ago and 6 months ago, China is used again and again as a political football.

It is only in the minutiae of real life that the suffering of the Chinese working classes can really be assessed. Per Capita Purchasing Power Parity Gross Domestic Product can’t illustrate the 72.5% of workers who have had their wages paid late or not at all; although perhaps it does include the 6%-12% of GDP estimated to be contributed by the sex industry (page 20 of the preview). I’m no prude, but nobody can fail but to be taken aback by the prevalence of sexual exploitation in China.

The fact is that China is still poor, that there are those in desperate need in China and that the CCP will not provide the assistance necessary to help them.

Further posts will explain exactly why I think that the institutions that helped China to succeed so far as a country of cheap, healthy, educated and disciplined workers are being undermined. I will argue further that the very process of marketising their economy and opening up to the world economy that initiated its tremendous growth, is also undermining it.

My preference is for those involved in multitude of protests, strikes and industrial actions that take place in China on a daily basis to wrest power and control back from those exploiting them. But until then I don’t feel supporting a transfer of wealth, institutions and knowledge from the rich world to the poor as left wing imperialism.

An Argument in Favour of the CAP

EU FlagThe Common Agricultural Policy of the EU is one of the largest subsidies in the world “it represent[ed] 48% of the EU’s budget [or] €49.8 billion in 2006.” That is a lot of money in anyone’s book, but when it appears hardly anyone is happy with the outcome generated it starts to look anomalous.

From the right, it is attacked by The Economist, which itself is flanked by the Adam Smith Institute.

[European consumers and taxpayers] will have to continue paying for this wasteful and wicked system. It is terrible for poor-country farmers, who have long suffered from being shut out of rich-world markets, and having rich-world products dumped on them. Now they can hear the gates of fortress Europe clanging shut just when world prices should be triggering an export boom. And it is dreadful news for the hungry poor, because restricting trade in food exacerbates shortages.

Similarly, the left attack the CAP for hurting smaller farmers while handing huge handouts to a handful of larger producers.

In a detailed breakdown of aid payments across the EU in 2000, the EC calculated that 78 per cent of EU farmers receive less that 5000 per year in direct aid. Furthermore, fewer than 2000 of Europe’s 4.5 million farmers between them rake in almost €1bn in direct aid from the CAP. Farm subsidies also vary in scale across Europe. In Portugal, approximately 95 percent of farmers receive less than 5000 each year, compared with 43 per cent in the UK. Moreover, 380 of the UKs landowners and large-scale agricultural businesses glean aid in excess of the 300,000 per farmer ceiling on annual payments proposed in the mid-term review.

By concentrating subsidies in the hands of its richest agricultural landowners, EU agricultural policies are hastening the demise of smallholder agriculture in Europe. (pdf)

Please allow me to take you back a century and a half.

The British Corn Laws were import tariffs designed to protect British agricultural workers and the landed aristocracy. In a way, they worked similarly to the CAP. Their effect was certainly similar, higher domestic prices and a reduced market for the agricultural products of the developing world. Of course at this point the developing world was Western Europe and the USA.

The Economist argues that the CAP is terrible for the contemporary developing world because it artificially deflates the value of their agricultural products and it hinders their access to markets for these products.

Famed free marketeer Richard Cobden may have taken an altogether different view on matters. He was a prominent member in the Anti-Corn Law League and argued voraciously for their abolition so as to lower the cost of food for the British.

But he did not argue for the abolition of the Corn Laws out of a sense of altruism for the poor wronged American, German and French citizenry.

He argued that the continuation of the Corn Laws positively aided the catching up of the developing world with Britain.

The factory system would, in all probability not have taken place in America and Germany. It most certainly could not have flourished, as it has done, both in these states, and in France, Belgium and Switzerland, through the fostering bounties which the higher priced food of the British artisan has offered to he cheaper fed manufacturer of those countries.

Perhaps The Economist is wrong. Perhaps the CAP has the potential to act as an additional stimulus to the developing world to move from agriculture  to higher value added activities like manufacturing.

Perhaps the abolition of the CAP is just another form of free trade imperialism designed to keep the third world in its place, out on the periphery.Well, done, you highlight when you read just like me and this white text has shown up. I’m hoping this post might cause some controvery so I’m hiding a disclaimer here. In my opinion the abolition of the CAP wouldn’t be a piece of free-trade imperialism, nor would it hurt the industrialisation of the developing world. Of course on the other hand its abolition wouldn’t be the panacea some describe it as, as always I think you’ll find it’s a bit more complicated than that. (Previously white on white. I’m sick of people thinking I’m a moron unnecessarily. There’ll be enough reasons for the Working Class Tory to hate me without making extra ones up)

BBC: UK economy ‘is growing/is still not growing/is shrinking’

Great reporting form the BBC.

Contrary to expectations, the UK economy did not grow in the third quarter of the year, an influential economic group has predicted.

Gross domestic product (GDP) was unchanged from July to September, the National Institute of Economic and Social Research (NIESR) calculated.

That’s bad news isn’t it? Oh wait a minute.

The NIESR points out that its forecasts tend to be within 0.2 percentage points of the first official estimate from the ONS, which means that it is likely the economy will show either a small amount of growth or decline.

So the story comes down to: “we might be growing, we might not be growing, or we might be doing neither.”

Really enlightening. You may as well read the press release (pdf), at least it has a pretty graph.

Given that at one point the “NIESR incorrectly predicted earlier this year that the downturn ended in March” and in the hope of finding some scoop, I checked the the NIESR figures on their own accuracy.

Annoyingly they are particularly accurate and fair.

The NIESR declare to have an error rate in the region of o.1 to o.2 percent of GDP. Below are figures comparing the quarterly GDP change from the NIESR and the Office for National Statistics.

NIESR        ONS
2008 Q1 +0.7    2008 Q1 +0.8
2008 Q2 -0.1    2008 Q2 -0.1
2008 Q3 -0.7    2008 Q3 -0.7
2008 Q4 -1.8    2008 Q4 -1.8
2009 Q1 -2.5    2009 Q1 -2.4
2009 Q2 -0.6    2009 Q2 -0.8
2009 Q3 0.0    2009 Q3 N/A

At this point this is a non-story but it fits nicely in with the “new” narrative  from the Conservatives’ that “Labour isn’t working”.

This is another example of a story that gets coverage even when it lacks content because it fits within a dominant media narrative.

Labour still isn't working

China at 60: Misunderstood

China-60.svgMao’s China has been annihilated. 60 years on from its founding on the 1st October 1949 there is little recognisable about it.

Although some on the left will lament the loss of this slightly more presentable face of state Socialism, this is a cause to celebrate. The Cultural Revolution and Great Leap Forward are two of the biggest tragedies to hit humanity. The gains which accrued under Mao are too small to outweigh the horror which occurred.

From ardent globalisers to hardline socialists it seems everyone can find something to celebrate in the New China.

Unfortunately the things highlighted by Andy and Tim underline the misunderstanding that surrounds the success of modern China.

But as the scholar and writer Perry Link has observed, it is more accurate to say that the people lifted the Communist party out of poverty – once it had the sense to get out of the people’s way.

This? This good sense in The Guardian?

Tongue-in-cheek, Tim highlights the Guardian’s coverage of China’s 60th and approvingly asks “So when do we start applying it in the UK?

The only problem is that Communist Party hasn’t got out of the way. Or at least not in the way Tim implies.

From the earliest days of agricultural reform to the performance of state owned industries now, the party has very much got in the way. The Chinese have found a recipe that works for them, for the moment.

That Tim wants to score political points from it is telling of the difficulty that the libertarian/classical liberal/free trading right has discussing China.

xin_5021006010642328146348Of course elements of the left are little better at understanding the complexities of modern China.

For some bizarrely reason, Andy Newman of Socialist Unity uses a PRC propaganda photo as evidence of the change in China.

It is certainly worth celebrating the victory which Mao won in 1949, however, to use it as a a reason to stifle legitimate criticism of the regime and its policies is ludicrous.

Both Tim and Andy fall into the same trap that most analysts of China do.

Although most people recognise that China cannot be easily placed on a continuous Left and Right, people still want to label elements of its economy as a left-wing or right-wing policy. I apologise for these caricatures of left and right but they illustrate major failings in some analyses of China.

The leftist penchant for state intervention can be totally inappropriate for China.

China’s agricultural economy was only really successful once peasant farmers once the Household Responsibility System was set up. In this, after selling a set amount of their crop at the low state determined price, peasants were allowed to sell their surplus at market rates. This fermented a boost in productivity not seen since the redistribution of land which followed the establishment of the PRC.

The right have of course been as wrong as the left when it comes to China.

In a developing economy state intervention is essential in creating, extending and maintaining a market. The traditional rightist view that state intervention equals bad does not hold.

It must be made clear that a lack of state involvement is not synonymous with the free market. The withdrawal of the state in China is often applauded, but institutions which were smashed by the retreating party cadres have not been replaced.

In a survey quoted in Hart-Landsberg and Burkitt’s China and Socialism 72.5% of respondents had at some stage had their wages withheld. David Harvey uses this as an explanation for how so much wealth has been accumulated by so few in such a sort amount of time.

In fact, most of the time this is presented as the evidence of how “extreme” capitalism has become in China. But the theft of labour is not part of capitalism. This is evidence of how poorly China has instituted its new economy. Capitalism relies on functioning markets and as Chris Dillow argues, markets can be undersupplied like all public goods.

It is this difficult framework which has made it so difficult for the big L Left Left and big R Right to discuss China. This is why I think the work of Karl Polanyi is so important to understanding China. In the next post I will outline some of Polanyi’s thought and why it is so useful when discussing China.

Harriet Harman: Pointless

Just heard Harriet Harman giving her speech from Brighton.

Clause one of our new Equality Bill will bring in a  legal duty on all public bodies to narrow the gap between rich and poor.  It will be a law that binds all government ministers, and all government departments as well as local government.

Calling such a clause pointless in generous. Totally unworkable, counterproductive and hypocritical would be another.

Harriet HarmanFirst of all it is unenforceable. Are policies to be judged before they are implemented and if so how will unintended side affects be accounted for? Or if they are assessed after the fact, what reprimand would be suitable or fair if the policy was embarked upon in good faith?

Not only that but it is totally out of step with past New Labour form, what about repealing anti-trade union laws or engaging in grassroots democracy instead of inefficient managerialism? Either of these would decrease inequality far more efficiently than this clumsy piece of legislation.

It may sound odd coming from a Socialist, but there are some things which may increase inequality that may actually increase everyone’s wellbeing too. For example, a more flexible and experimental NHS could leave people with unequal access to healthcare, but if it allows experimentation it may help increase everyone’s lot. Such a clause would censure this policy.

Creating a more equal society is not a pointless endeavour but I cannot see the point in this legislation. When we have Conservative MPs attempting to ban unicorns, and Lib Dems grandstanding with calls for savage cuts, I foolishly still like to expect more from Labour. But this is New Labour, rhetoric without substance or a route to realise it.

Thomas Byrne is still wrong on Fairtrade

This post is a response to Fairtrade, Bankers, and Development, a reply to Left Outside from ByrneTofferings, which was a response to Why Thomas Byrne is wrong on Fairtrade from me, which was a response to his original post here on why Thomas Byrne Boycotts Fairtrade. This debate was originally started on a whim but has now been submitted as part of the Blogger’s Circle project.

fairtrade-vertical-colourThomas Byrne is still wrong on Fairtrade

I hope Thomas Byrne will forgive the unnecessarily incendiary titles, as I don’t really want these posts to be negative or an attack on him, he is after all a lovely chap.

I would rather these posts provide positive arguments in favour of Fairtrade and – more specifically – effective development strategies.

I argued here that the main aim of development must be for a country to move from low value-added to high value-added activities. I argue that Fairtrade can be a useful tool in helping those in the developing world upgrade.

Thomas Byrne asks how subsidising and in effect artificially increasing the price of a commodity like coffee can possibly help a country upgrade.

By subsidising the production of a particular foodstuff or non-food agricultural item you will induce overproduction, a fall in price and exacerbate poverty, the opposite of what was intended. As unsavoury as we may find the results, it would be better to let the market take its course.

I think I have condensed ByrneTofferings’ argument accurately but if I have slightly misrepresented it I can of course alter it.

The reasons I support Fairtrade are fairly complex and tie in with my views on how successful countries have developed and what are good strategies for countries seeking to develop.

If I went into the detail necessary, the only response I would expect would be tl;dr. So for the sake of brevity I think the best way to begin to discuss Fairtrade is to look to the reflection on capitalism of a 19th Century German.

No not Marx, Johann Heinrich von Thünen

Johann Heinrish von Whonen I hear you say. Well, he was a nineteenth century landlord who wrote the book The Isolated State.

In this book posited a thought experiment that was to form part of the foundation of Economic Geography.

Imagine a very large town, at the centre of a fertile plain which is crossed by no navigable river or canal. Throughout the plain the soil is capable of cultivation and of the same fertility. Far from the town the plain turns into uncultivated wilderness which cuts off all communication between this State and the outside world.

That are no other towns on the plain. The central town must therefore supply the rural areas with all manufactured products, and in return tit will obtain all its provisions from the surrounding countryside. [1826]

<a href=In this society productive organisation  is going to be divided not just by class and by what is produced but also by space.

The cost of agricultural goods produced outside the city will consist of the cost of production plus the cost of transportation. As shown below an outer limit will be created beyond which it is uneconomical to produce a given good.

If we allow ourselves to imagine more than one agricultural item being produced, we can see that agriculture will divide itself into rings surrounding the city.

As land owners nearer the city will be able to extract a higher rent than those closer to the outskirts ,the agricultural production nearest the city will necessarily be the most profitable, those furthest away the least.

Transport Costs

If a traveller were to set out away from the city in a straight line they would pass through a number of different rings, each producing something different, and crucially each using a different production system.

This microeconomy is a remarkably accurate model of what pre-industrial revolution society was like. Roads were rare in continental Europe and most grain was consumed within a 20 mile cart ride of were it was produced; cities without access to sea or rivers rarely exceeded 1,000 persons.

We have moved on a long way since then, however this spatial inequality and differentiation between economic sectors continues.

Inequality, development and space

Before the industrial revolution inequality was rampant. However, inequality was distributed equally across the globe. For example, 500 years ago Asia and Europe were economically speaking roughly equal, however since then spacial inequality has rocketed.

World System Theorists argue that capitalism involves spacial inequality because wealthy nations get more wealthy by exploiting the poorer. By engaging in capitalist development the poorer countries are aligning themselves in a periphery which is exploited by a core and semi-periphery.

Neoclassical economics contends that poor countries are only poor residually and that capitalism does not create their poverty. In fact it argues that the positive spillovers of the rich world make the poorer countries richer indirectly.

Von Thunen’s thought experiment offers a critique of both views.

Although it is evident that an economy must be divided into zones similar to those described in World System Theory, it is also clear that economic underdevelopment does not necessarily result from this.

As you move away from our theoretical town the type of production engaged in changes. Closer to the town it is more capital intensive but further away it is more land intensive.

The simpler production systems used on the edges of this economy imply a lower level of Smithian specialisation and lower productivity per worker. In this scenario, as with World System Theory, the periphery of this economy is most likely to have lower incomes precisely because they are engaged in commerce with the core.

Coffee_Beans_closeup

Strategies for development and Fairtrade

Two strategies present themselves as a route to development, one is to follow your comparative advantage and to produce what you produce most efficiently. Essential to the success of this strategy is to move on from a sector when it begins to suffer from declining returns; that is to find an alternative leading sector in which a country has an advantage when inputs in the old industry begin to produce outputs that do not lead to development.

Another strategy relies on diverting the profits from the sector in which you have comparative advantage to enter a higher value-added industry which you are currently not specialised in. For example, South Korea used profits gained from agriculture, and other industries to subsidise the production of microwave ovens. Although they were originally producing microwaves at a loss, through learning by doing, increasing capacity and increasing returns to scale they created a new leading sector from scratch.

Both strategies have risks, by relying on comparative advantage a country can be held hostage because demand for a raw material can taper off. The second strategy implies the risk that the new firm will never become profitable and fold.

Returning to our coffee growers, it becomes clear that they are operating on the periphery of our global economy. Their impoverished state also makes it clear that their current niche is no longer capable of producing economic development.

Thomas Byrne’s logic dictates that coffee growers must leave the sector and seek employment elsewhere, the current price for coffee cannot sustain the current number of coffee growers.

There is little alternative employment available in Mexico, Peru, Ethiopia, Tanzania or Malaysia. This is why I support Fairtrade, by providing a subsidy Fairtrade provides a surplus which would otherwise be absent and provides funds to upgrade their production.

For example in Guatemala growers have been able to begin growing new crops to supplement their coffee production, this is not a great leap forward, but it is an improvement.

By providing capital to small producers and expertise in world trade Fairtrade can be a tool which can help create new sectors in previously stagnant economies.

Thomas is right that there are other things which need to change that can make a much larger impact than buying a different bar of chocolate.

  • In the rich world agricultural subsidies need to end and tariffs need to be scrapped.
  • Illegitimate debt needs to be dropped and countries must be allowed to follow the lead of Ecuador in unilaterally abandoning it where possible.
  • The tight constraint which World Trade Organisation, World Bank and IMF rules place on developing world policy makers must be loosened. They must be allowed the “policy space” which the developed world enjoyed.

All of these things would have a larger impact than Fairtrade, even if Fairtrade was to account for more than 0.5% of agricultural production worldwide as it currently does.

While there are better ways to help the developing world than buying Fairtrade it does not follow that it should be abandoned. Likewise, the problems of implementation described in this Adam Smith institute report are not convincing arguments against Fairtrade.

For example, at the moment only 10% of the premium paid for Fairtrade goes to farmers in the developing world, but this is due to an information asymmetry which domestic retailers exploit, it is not a reason to abandon Fairtrade.

Some companies like Cafe Britt roast all their coffee in the country where it is produced, something which Fairtrade is yet to take up. However, this is not a reason to abandon Fairtrade, it is another reason to improve it.

Unlike Thomas Byrne and the Adam Smith Institute I am unhappy to rely on the market to dictate the rate at which the poor world develops. Given the enormity of the problem facing the world we should embrace Fairtrade as a palliative even as we strive for a more solution effective too.

Further Reading is available from the Fairtrade Foundation’s own reports and some  interesting arguments against the organisation can be found in this assault on Fairtrade Fortnight from the Adam Smith Institute. Another pro free-trade anti Fairtrade post can be found here at Suburban Musings. Much of the information on von Thunen, economics and the state comes from the truly excellent States versus Markets by Herman M Schwartz. It makes an excellent companion to Kicking away the Ladder and The Open Veins of Latin America for someone curious about the economics and politics of development.

Why Thomas Byrne is wrong on Fairtrade

fairtrade-vertical-colourThomas Byrne has been slurred by his friends as an ‘evil capitalist swine’, [who would] ‘rather see people suffer’, than be brought out of poverty through these wonderful Fairtrade schemes.

And rightly so.

His arguments against Fairtrade show a fundamental misunderstanding about how a poor country develops into a rich one.

ByrneTofferings‘ main argument against Fairtrade is that it is not free trade. I’ve reproduced some below with my emphasis to illustrate where he’s gone wrong.

[Fairtrade] distorts the markets, and while it may be good for the coffee grower in the short term, it’s bad for them in the long term, it’s bad for other coffee growers who aren’t part of the schemes (because they have to sell at the same price as everyone else), and it’s bad for the consumer because it costs us more than it should. Obviously we have the choice to go elsewhere, but that necessitates that there are some producers not part of the Fairtrade group which again, hurts them.

Where ByrneTofferings goes wrong is that he assumes distorting markets is a Bad Thing. For a developing country nothing could be further from the truth.

Exporting primary materials like coffee or rubber is a precarious situation for any country to find itself in. For example, the economies of Peru and Chile nearly collapsed after their export of nitrate fertilisers was obliterated by the creation of the Haber Process in the early 20th Century, which provided a cheaper, closer and more reliable source of fertiliser.

This is why distorting markets is so important, it allows countries to move from low value-added to high value-added activities more swiftly. For example, moving from low value added coffee growing, to coffee roasting, to coffee packing and finally to high value added coffee marketing will increase people’s well being and domestic stability as the economy diversifies.

Relying on a natural resource is dangerous and waiting for your domestic economy to upgrade naturally is risky.

There are plenty of ways which Governments can distort markets to make development and domestic upgrading occur more quickly.

  • For the capitalist out there, a government could grant tax exemptions or holidays to businesses engaged in capital investment. For example, tax breaks for firms that invest in new facilities rather than pay higher dividends.
  • For the centrists, firms engaged in similar endevours could be encouraged to congregate in selected “special economic zones” via various subsidies. By bringing these together the government would encourage positive spillovers which would not occur without some guiding visible hand. For example, car manufactures sharing widget producers.
  • For my comrades, a state firm could use tax revenues to promote full employment pushing up agregate demand and subsidise domestic demand.

Fairtrade goods are an excellent way to get money into these developing countries to allow them to undertake these sorts of endeavours. ByrneTofferings argues that it would be better to give money to a charity, but charities are accountable to their donors, not the recipients of the aid. Fairtrade puts money in pockets and channels it through productive businesses, this is the advantage it has over charity.

Fairtrade on its own will not change many lives, but coupled with an activist Industrial, Trade and Technology policy it can provide a vital step to improving the condition of those in the third world.

A reply from Thomas Byrne is here http://www.byrnetofferings.co.uk/2009/09/brief-reply-to-leftoutside-on-fairtrade.html

Honduran Coup: Zelaya under siege in Brazilian Embassy

Earlier today forces commanded by interim leader Roberto Micheletti surrounded the Brazilian Embassy (H/T Calvin via Socialist Unity).

At some point in the previous 24 hours the democratically elected leader of Honduras Manuel Zelaya returned and took shelter in the Brazilian Embassy.

Following this reports have become increasingly confused, and little is known for certain. For one thing it is claimed that Zelaya’s arrival was a surprise to those working in the embassy, although he was welcomed.

Nonetheless it is clear where the sympathies of the Brazilian authorities lie. They regard Mr Zelaya as the legitimate president of Honduras and say there is no question of either handing him over to the military forces outside or asking him to leave.

One official told me “he is welcome to stay for as long as he wants”

Hondurans in civil resistance surrounded the Brazilian Embassy in Tegucigalpa yesterday to greet their returning president. This morning, coup regime troops attacked them violently, sending 24 wounded to hospitals. D.R. 2009 Mariachiloko, Chiapas Indymedia.

In the short term, the overnight curfew due to last from 4pm to 6am has been extended to 6pm and is expected to last into the night. As pictured, many appear to be in open revolt.

Supplies, power and water have been cut off from the Brazilian Embassy and there is something of a siege situation emerging.

Brazil’s President Lula has called for a cessation of hostilities and the immeidate withdrawl of troops from near the embassy. He has also called for Obama to voice his support for Brazil and Zelaya.

The only anti-coup TV station Channel 36 has gone off the air. Radio Globo’s Internet site is down too. There are also efforts to scramble mobile phone usage.

From Al Giodarno

3:18 p.m.: Micheletti blinks:

Honduras’ de facto leader, Roberto Micheletti, said on Tuesday he has no intention of confronting Brazil or entering its embassy where ousted President Manuel Zelaya has taken refuge to avoid arrest.

“We will do absolutely nothing to confront another brotherly nation. We we want them to understand that they should give him political asylum (in Brazil) or turn him over to Honduran authorities to be tried,” Micheletti told Reuters.

Meanwhile, at least two popular barrios in and around Tegucigalpa have defied, en masse, the curfew order and chased National Police out of their communities: El Pedregal and Colonia Kennedy. They’ve erected barricades and declared the coup regime and its security forces non grata.

More information as it comes in. Narco News will carry more up to date information than I possibly could, subscribe.

Lawsuits from the ’20s/Jackboots from the ’30s

So what do we call these Scum? Anton Vowl asks, what indeed.

The English Defence League claim to have been declared a “proscribed organisation” by the self-proclaimed “anti-establishment” BNP. Yet, their propaganda uses headlines garnered from the mainstream media.EDL

Set up following protests in Luton organised to abuse returning British Soldiers, they are a gang of overwhelmingly (possibly exclusively) white, poor, disaffected football hooligans with a fanatical hatered of Islam.

However rather than being ideological firebrands, the rank and file are apolitical and “their main motivation is actually the beer, camaraderie and chance of a fight.”

Better than Islamists, “brown people” or “foreigners” might be a more apt description for their targets – or it might not – it is quite hard to tell whether their propaganda about targeting “islamification” is genuine or a smokescreen.

Although keen to present themselves as only opposing extremists like Anjem Choudhry, Carl Packman highlights the hostility of the EDL towards all Muslims.

Ray, during the interview conducted by The Stirrer’s editor Adrian Goldberg on Talksport, revealed, however, that it is not just Islamic extremism that he takes a disliking too. The entry explains;

During the course of the interview, it became apparent that Ray’s own view of Islamic extremism isn’t limited to suicide bombers and hook handed preachers of hate.

He argued that the Qu’ran teaches all its advocates to wage jihad or holy war in non-Muslim countries, and acknowledged that on this basis, all devout or practising Muslims in Britain, are – in his words – “at war with our country.”

When pressed, he said:  “They’re ultimately engaged in converting our country to an Islamic state…that is the religious mandate of the Qu’ran that all Muslims must adhere too.”

The organisation, along with another similar Stop the Islamisation of Europe, with divisions all across Europe, has tried its hardest to appear simply against “Islamofascism”, and the apparently slow descent into a totally Islamic state.

A Very 1930s Wardrobe.

Battle of Cable StreetUAF (United Against Fascism) undoubtedly see the EDL as a modern British Union of Fascists, contemporary footsoldiers for the BNP.

In 1936 Oswald Moseley tried to lead his Blackshirts through the Jewish East End of London and was repelled by Jews, Socialists, Irishmen, Anarchists and Londoners. This is the scene UAF and SWP envisage, probably hope for.

This is an unlikely but realistic development from the EDL’s current position. Although the BNP have disowned the EDL – even admonishing them for “marching with negroes” – it seems their mutual disrespect does not extend to Facebook where senior figures remain friends (H/T Eric the Fish).

A modern Battle of Cable Street would not be pretty but it may be on the way. Despite their cowardly exploits so far, it seems the EDL are spoiling for a fight and various Muslim groups are only too keen to give them one.

There is something particularly un-British about Jackboots on cobbled street and it would be hard not to join Lenny’s triumphalism if Cable Street repeated itself. I agree that they must be challenged, but no arguments would be won and it may play directly into the EDL’s arms.

It seems the EDL have struck a chord with some. Their arguments questioning the loyalty of Muslims come not only from their own paranoia and the pages of the Daily Mail, they come from the pages of history too.

A Very 1820s Argument

Anyone who knows anything about the Tudors knows that a lot of Catholics got burnt to death.

Burn Them!

Whether this is entirely accurate or not, it illustrates the difficulties which Catholics have had to endure living in Britain. Since the establishment of the Church of England by Henry VIII Roman Catholicism has been viewed as an existential threat to Britain, and until relatively recently Catholic have been pictured as inferior, feckless and treacherous.

The reasons for this pariah status are many, but the arguments provided then bare a striking symmetry with those deployed by the EDL against Muslims today.

To provide some historical background you have to understand that following the Act of Union between Scotland and England in 1707 the positions of Catholics was enshrined in law as second class citizens. In fact, our constitution still bars them from becoming the Head of State.

Life only began to slowly improve for these poor souls with various Catholic Relief Acts in the 18th Century. While these only allowed them to own property, inherit land and join the army they still provoked riots. While progress had been made since the bonfire-happy 1500s the nineteenth century was still fairly unpleasant place for Catholics.

The slow expansion of the franchise had entirely bypassed Catholics, it was only in the 1829 that the vast majority of the various laws penalising them were repealed. For example, only in the 1830s could they become MPs or senior civil servants.

Catholics and Muslims

First of all, there is the simple pre-existing prejudice that existed and exists against Catholic Irish and Muslim South Asian and Arab immigrants.

It is easy to rationalise hostility to the competing Catholic Irish labour force during the nascent Industrial Revolution, but it is more difficult to explain the brazen Sieg Heils at recent EDL rallies without reaching fairly daming conclusions.

But there are further reasons both groups have faced hostility. These are more complex than simple racism, but can prove just as stubborn to overcome.

Arguments for repressive action against Catholics and Muslims have been couched in terms that portrayed them as a physical threat to the UK. The EDL are quite plain that they consider the recent appearance of Muslims and Mosques an invasion.

The Catholics in early modern Britain were seen as such a threat that Test Acts were introduced in 1672, 1673 and 1678 to “test” those who wished to become public officials. The Long Title of this act was “An act for preventing dangers which may happen from popish recusants.”

The idea of an external Catholic threat to Britain was quite valid at the time, although the threat from actually existing Catholic subjects was negligible.

The King of France had taken in Catholic James II following his overthrow in the Glorious Revolution, and a Catholic invasion was attempted via Ireland soon after. Moreover, the Pope was no mere public figure head in the 17th Century, he was the head of an army and his own Papal states with a penchant for interfering in the affairs of Sovereign nations.

The same challenged is levelled at Muslims today. Under the pretence of helping to avoid another 9/11 or 7/7 Muslims are stigmatised as part of a larger conspiracy just as Catholics were accused of being a part of a “Popish Plot.”

While it probably true that some Catholics were plotting to bomb parliament, just as some Muslims have planned terrorist attacks, it was ludicrous to treat them as second class citizens for the criminal actions of a minority. The threat from a certain tiny number of Muslims has been used and abused to stigmatise the majority. This is as futile now as it was then.

The external threat from Muslims rests on the idea of a unified body politic. Failing this it is argued that Muslims owe a loyalty to the Ummah first, and not their fellow citizens.

The diversity of Shia, Sunni, Sufi and other Muslim sects should be a poweful argument against the idea of any unified force existing, but is seems theology is not be the EDL’s forte.

In retrospect we can see that the contemporary arguments against Catholics seem to hold little more water than their modern equivalents. However, at the time we must remember that there really was a united head of the religion who demanded ultimate loyalty, the Pope.

Of course, for all the theoretical devotion which is demanded by the Ummah – or Pope – the actually existing situation differs greatly from the one proposed by the EDL.

Just as it has proved easy to be Catholics and British, it is equally possible to be Muslims and British.

The arguments that Muslims or Catholics are a threat because they owe a loyalty to something other than the motherland, or fellow citizens, is based on a fundamental misunderstanding. This won’t stop the EDL using it but,  bearing in mind these historical parallels, the majority of the population will not be taken in.

Demographics are Destiny

Ironically, the one thing which made the Catholic’s triumph inevitable has also proved the hardest hurdle for Muslims to overcome: Demographics.

The 1800s saw the Catholic population grow in size, power and influence, while demographic changes did not make the extension of suffrage inevitable it made it possible. Direct action from Daniel O’Connell met broader societal change and helped to smash the old system and bring Catholics into the mainstream.

The paranoia which helped spark the riots which followed the earlier Catholic Relief acts had been disproved by simple experience. The expanding numbers and influence of Catholics was no longer used as reason to mistreat them but as a reason to allow them full rights and respect.

The contemporary account of demographic change is less pleasant. The relative fecundity of Muslims has become a major rallying cry for the EDL. Despite the dodgy figures and sums being debunked the EDL still claim a Muslim takeover is inevitable.

The ideas of a Muslim Majority Europe relies on a series of assumptions so colossal that no demographer worth their salt would back them. Muslim birth rates rarely seen outside rabbit warrens would have to be combined with a lack of integration unheard of outside of southern Spain.

As has been shown time and again, familiarity breeds tolerance and even acceptance.  Today the EDL should be openly challenged, and broader changes in society will do the rest. The numbers of Muslims will increase but not dramatically and the world will not end (personally I hope they see the light and join me in blissful atheism, but that’s for another post).

The changing composition of society proved that Catholics were not bent on world domination and could be trusted. In the following years Catholics made ever greater contribution to society.

Hopefully the same will be said when people look back at this period and the EDL will be relegated to an aside in a footnote on some protests in Luton.

More information on the EDL available from ByrneTofferings and Liberal(Democrat). Pickled Politics, Lenny and Socialist Unity also all carry stories on the EDL. Visit your Pastor for more information on Catholics or email god@heaven.com.

during the interview conducted by The Stirrer’s editor Adrian Goldberg on Talksport, revealed, however, that it is not just Islamic extremism that he takes a disliking too. The entry explains;

During the course of the interview, it became apparent that Ray’s own view of Islamic extremism isn’t limited to suicide bombers and hook handed preachers of hate.

He argued that the Qu’ran teaches all its advocates to wage jihad or holy war in non-Muslim countries, and acknowledged that on this basis, all devout or practising Muslims in Britain, are – in his words – “at war with our country.”

When pressed, he said:  “They’re ultimately engaged in converting our country to an Islamic state…that is the religious mandate of the Qu’ran that all Muslims must adhere too.”

High Heels, Low Politics

The TUC has recently put forward a motion attacking the inclusion of high heels as part of any mandatory dress code.

When announced, this provoked a minor furore when Nadine Dorries attacked the TUC and instructed them “to get real, stop using overtly sexist tactics by discussing women’s stilettos in order to divert attention away from Labour chaos and debate something meaningful: like where has all the money gone?”

Reading this motion in the context of Dave’s post it is easy to ask; what is the point of Trade Unions? Like Paul Sagar I’m not a member of a Union, and as much as I joke about it loudly in front of my bosses, I have no intention of joining or forming one soon. I don’t consider my job permanent enough and I’m quite content at the moment blogging (although that’s another blog altogether).

This motion surely proves that the TUC has lost its way. Surely the TUC should be concentrating on things like this, not shoes.

Maybe, on this occasion *gag* Nadine Dorries is right.

Oh wait… Now there’s a surprise! Turns out Nadine Dorries is either intentionally misrepresenting the TUC or has the reading comprehension of a child.

Out of the 85 motions in this TUC document the motion discussing footwear is 81st. This has been explained here by Sunny and here by Nicola Smith, not to mention being plain as day on page 40 of the original proposition that no one is banning high heels. There Dorries, look! a third attempt to explain it to you.

I appreciate that Nadine Dorries is an MP and quite busy, but I do like it when my MPs have a slight inkling what they’re talking about, especially on issue where all the relevent information is 5 minutes of googling away.

In short, The Society of Chiropodists & Podiatrists has recommended that high heels should never be compulsory, as they exert unnatural and dangerous force on the legs and body (please click on insert picture for a more detailed version).

Moreover, compensation for damage done to the employee would not be easy to claim from employers, as it would be near impossible to prove causation for long term foot problems. Where gains are privatised and the losses socialised we should seek correct this imbalance.

In this context this motion is not a “waste of time” or “controversial,” it is dull, dull, dull, bread and butter trade unionism.

The TUC examined the evidence and put forward a modest proposal to stop employers forcing staff to do things which were unsafe. As with most the health and safety recommendation these are dull. It’s silly season, its been fisked (H/T ByrneTofferings) but it has poisoned the public view of unions.

Even lefties now see this basic, boring incremental increase in the well being of working people as the machinations of the loony left. It’s not important, it’s not major, but it will make some people’s lives better without any sacrifice from anyone else.

In a bizarre twist, today’s story in The Sun which Nadine Dorries claims to have written, may not even have been written by her.

Just to provide some context, I challenged Thomas Byrne to write about high heels last night as he was stuck on what to write about (it appears we’re in broad agreement here, yippee!). While I was having a quick look around I noticed that Nadine had a new post in which she writes [my emphasis]:

In the first attack, the article I wrote with Karen Brady in the Sun was referred to. I have been told that apparently, the motion mover said that Karen and I and the Sun newspaper in which we wrote, should be collectively ashamed.

If that wasn’t enough; the seconder (sic) linked me with the Daily Mail and said she doubted that I had ever worked a ten hour shift in heels. Wrong. I frequently work 16.

I applaud the society of Chiropodists for pointing out to me the dangers of this; however, having done so I now respectfully ask them to leave it me and every other high heel wearing woman in the land to decide whether or not we wear high heels in the workplace.

Aside from the strange way in which she manages to agree with the TUC position at the end of her piece there is something else odd about this. Last night the article to which she links, and which she claims credit for, was credited to her and Karen Brady. This is how the byline looks now:

By David Wooding, not Nadine DorriesIf anyone can help me get hold of a cached version of that page from last night or a scan of the original paper, it would be much appreciated. I would also quite enjoy some idle speculation as to why the authorship of this article was originally wrongly attributed, or altered after publishing.

Normally I would suggest the appalling writing style, but I’ve read Nadine Dorries’ blog, and this is Solzhenitsyn in comparison.

Ben’s Blog: Prisoner Reform and the Internet

As far as controversies go, a prisoner blogging is never going to rank with the modern presumption of paedophilia or the exploits of Glen Jervey.

I doubt that a prison blogger being banned is going to attract much more attention. And if it does it will likely be a mumbled “too right, bloody con.”

Ben’s Blog is currently the only Blog being written by a serving British prisoner. Like NightJack, he writes from a perspective which is currently unique and with honesty which is somewhat disturbing.

As prisoners are not allowed internet access Ben publishes through letters sent to his friends on the outside, who post on his behalf.

However, a letter was seized yesterday as it left the prison because “the content is interesting enough to be published on the internet.” This is the beginning and may be the end of a campaign to shut down his blog.

As a precaution Ben Gunn, the author of Ben’s Blog gave a piece to John Hirt should his blogging be stopped. It is currently available on Comment is Free and details why he blogs, why banning prisoners blogging is illegitimate and why allowing prisoners to blog is important in the first place.

Unfortunately the discussion at CiF has already descended into some name calling and rudimentary untruths. Someone has accused him of not being sorry enough:

CiF2This is said despite Ben having said:  “I was a boy when I committed my crime. I handed myself in to the police and pleaded guilty in court. That was the sole act of violence in my life and I feel revulsion at my crime, which is a permanent stain on my spirit.” Perhaps Ben is the wrong sort of sorry.

While another has a reading comprehension of a Daily Mail commenter:

CiF1At the risk of repeating my self: As prisoners are not allowed internet access Ben publishes through letters sent to his friends on the outside, who post on his behalf.

The restriction on prisoner internet use and on prison blogging by proxy interest me as a blogger and a someone who thinks our prisons are broken.

Should the government censor the internet? If so, should prisoners be able to blog, even by proxy? If so, should prisoners then have the right to use the internet directly? How much liberty should you lose when you enter prison?

What is Prison for?

Before we get to that we have to look at what a prison is for. There are many reasons for sending people to prison, and each individual weights the different reasons differently. However, the ultimate purpose of a prison is to ensure that as few people as possible become the victim of crime.

Of the many reasons for imprisoning someone vengeance certainly plays a big role for some people. In my view this is the least convincing reason for sending someone to prison.  Revenge is certainly cathartic, but that feeling would soon fade and you would be left with… what?

The idea of vengeance is of course closely connected with the idea that a criminal needs to repay their debt to society through suffering and the deprivation of their liberty. This is something which is more valid than merely seeking revenge, it strikes a very basic chord of justice, that someone be responsible for their actions.

These two reasons are especially primal, but still utterly valid. However, I believe that fetishising these reasons for prison or punishment will only lead to a more dangerous world, and ultimately counteract the most important basic function of a prison: to keep up safe.

In my mind the other functions of a prison are far more important. Prison are fairly good at keeping those who have been convicted of crimes away from people who have haven’t. That is the separating the criminal from society argument.

In this way prison very obviously and deliberately separates those deemed likely to offend from those assumed innocent. And to a degree it works, it is very difficult to reform someone overnight and in the time it takes to do so it is sensible to keep them away from others.

However, what decides how effective a prison is at keeping me safe are its last two functions, deterring some and reforming others.

The idea of prison as a deterrence is something which I find hard to prioritise, but the threat of punishment is surely an important factor in keeping people safe.

Of course the most important thing is not how dreadful you can make prison, or how “hard” your time is, but the overall likelihood of you ending up there.

What some miss is that although some people do fear jail, they don’t fear being caught. Prison as a deterrence does not rely on how awful you can make the place, being locked away from friends and family is always going to be awful. Making it likely to be caught, now that will reduce crime.

Lastly, and most importantly is the role of prison as a place for rehabilitation. Crime is not a pathology, in any society with any set of rules people will transgress them and enter some sort of “law and order” system. It is important to rehabilitate those who become criminals as only very few are incapable of making a contribution of society. A prison is a vast well of wasted opportunity.

Using prison to deter people will never deter enough. Concentrating on revenge will only create more criminals seeking it themselves. Focussing on extracting the maximum payment for a crime will only increasing the likelihood of it reoccurring. You can only lock someone up so long to keep the general population safe, if you don’t reform them (or they reform themselves) then they, and the people they meet, are in deep trouble.

Reform

Prison reform is a vast task, and making sure prison and punishment actually work is an incredibly important task for any society. The Howard Reform League are an excellent place to start if you are curious about the general case for prison reform.

Some obvious reforms are sending people to prison less as it tends to criminalise those who are only petty offenders; or allowing prisoners the vote as it connects them with the outside world and ensures their voices are heard.

In all honesty allowing internet access for those inside must come fairly far down the list of things which prisons need to change, but it should be on that list. A big part of rehabilitation is connecting prisoners to the outside world, and the internet is incredibly good at doing that.

Moreover, as the internet becomes a more and more integral part of our world, cutting a segment of our society off from it will only further alienate them. For both of these reasons allowing most prisoners supervised time on the web will be a good thing.

There are dangers of criminals using the internet (writing a blog is of course not one of them). Sex offenders are often cited prime examples of those who it is imperative to keep away from the internet, as the internet is essentially a vast porn reservoir. A similar argument is made with violent criminals. What if the internet is used to goad their victims?

Worst of all is the threat that a convict may Google “prison break” and get a whole lot more information than Wentworth Miller’s vital statistics.

However, these are arguments that rest on the assumption that prisoners can never be trusted, and that monitoring them is an impossible task. These are disingenuous arguments. Prisons operate smoothly only with prisoners consent and prisons can set the rules for internet use, and it can be allowed withing set parameters.

Internet use can be monitored as postal correspondence is. It can be rationed so that the task is not so gargantuan as to be impossible. But in the end it should be allowed, as prisoners should remain part of our society so that one day they may fully rejoin it.

Of course some believe that internet use should be proscribed because prisoners have forsaken their right to it, or because it would lessen the deterrent effect of prison. I think these are specious arguments too, the only convincing argument is that prisoners don’t deserve the internet because they have renounced their right to it. It is our right to not allow it in simple vengeance for their act.

This doesn’t shape up either, as it ignores the most vital role of prisons: to keep us safe by ensuring those that go there do not do so twice. When you enter a prison you lose your liberty, but this should be with the aim of returning it to you in the knowledge it won’t be abused. Restricting the internet is unfair and counterproductive.

The internet will never be the most important issue in prison reform, but it should be part of our manifesto and access should be demanded without hesitation.