The Obscurer

A Short Post About Inflation

I have forgotten more about economics than I ever knew, and I hope to demonstrate that here today. While many people seem to be losing their heads over yesterday’s rise in the inflation figures, I’m long enough in the tooth to remember a time when such statistics would have been viewed with envy. Certainly inflation is high by recent standards and heading in the wrong direction, and the price of some household staples and essentials has risen by far more than the headline inflation rate – perhaps I am complacent because my recent shopping basket included two plasma-screen TVs, so presumably bringing my personal inflation rate down even as the rise in the price of milk and bread popped a few quid on the top of my weekly shop – but I still don’t think the current situation quite deserves the media’s hyperbole, even if over time it may do. After all, if it is generally held that Labour inherited a fairly benign economic situation from the Conservatives in 1997, and if inflation is now at an 11-year high, then from a different perspective aren’t we are back where Labour came in, in fairly benign times? My fears are reserved for the precarious future, rather than the somewhat over-egged present.

But my main thought today is for Alistair Darling’s response to those inflation figures. While obviously trying to play down concerns, alleging that the British economy is well placed to weather this economic storm, an assertion for which there is no evidence whatsoever, he was still anxious to stress that the recent rise in prices emphasised how important it is to bear down on wage increases in both the public and private sectors so we can avoid a horrific wage-price spiral.

True enough, in principle; but if, as is generally believed, the current inflation is largely due to the rise in commodity prices, then in the first instance inflation will continue to rise regardless of any wage restraint. If inflation is running at 4-5%, do we really need to be talking about pay rises of around the 2% mark to fight the good fight on inflation? If anything isn’t the opposite the case, that such a cut in real wages, while being marginally anti-inflationary, could cause more problems as people have even less cash to spend at the shops, so tipping us further into recession, and that rather than donning the hair-shirt we should be looking at reasonable rather than restrictive pay rises? We can overdo this wage restraint lark, can’t we?

I can assure you that you can forget any idea that I am motivated in saying this by the fact that my wage negotiations are starting soon and the Chancellor’s inflation line is bound to be mentioned as once again we are likely to get offered 0% of bugger all (now look who’s indulging in a little hyperbole.) Similarly, you can dismiss any thought that Alistair Darling’s statements are in any way predicated upon wanting to keep some sort of lid on the public finances, rather than purely fighting the doughty fight against the inflation menace.


What of our Shadow Chancellor then? George Osborne was on Newsnight last night and in a rush of blood to the head appeared to offer a policy. The government should cut tax on fuel, he said, so to help hard pressed families. How to square that with the Conservative’s green agenda? Well, with a piece of nonsense called the “fuel stabiliser” Osborne said a Conservative government would then raise fuel tax as the price of oil falls. For a Tory, a Tory, to suggest a policy that so neuters the price mechanism seems quite astonishing to me, but this went unchallenged by interviewer Gavin Esler. I have little faith in this Labour government, but the prospect of the Conservatives in power quite scares me; not because their ideology is repellent, and not because they have generally run scared of announcing what they would do if or when they form the next government (which seems a perfectly reasonable political strategy,) but because whenever they are asked what could or should be done about the problems we are facing at the moment, when the silence isn’t deafening their response is so utterly fucking clueless.

Morning Bell

I drive my own car. I fill it up at the pumps, and when diesel hit 121.9p per litre, which I paid outside Chipping Norton a couple of weeks ago, it really struck me that there was an intriguing advert on the forecourt of the filling station.

“A great way to start your day,” the advert announced (or something like that), and it featured a picture of some breakfasting suggestions, purchasable, one presumes, in the little shop. There was a washed-out looking photograph of an arrangement of some common-or-garden morning staples; a coffee, a croissant, a sweet Danish pastry…but then, somewhat disturbingly, a fresh, folded copy of the Daily Mail and two cans of Red Bull.

And I’m scared, frankly. Scared that someone thinks that those last two items taken together are a suitable and safe way for someone to start their day. Scared that perhaps the creator of that advertisement personally kicks off their morning by necking a couple of cans of Red Bull while devouring the latest ravings that the Mail has to offer. The possibility that someone, once fully breakfasted in such a style, and no doubt swivel-eyed, delusional and frantically gibbering Daily Mail stock-phrases to boot, could then embark on a full day’s work doing, well, anything really, anything at all, quite petrifies me.

Am I wrong? Naïve? Am I the one out of step? Is a double dose of adrenaline and bigotry a popular way for people to begin their day? Perhaps, but I have to believe that it is not, that the constituent parts of this lethal cocktail are kept at a safe distance from each other for the most part, and that the only person who thinks that the Mail and taurine should be freely mixed is also the person solely responsible for this advert.

Clearly I need to take action. I don’t want that advertisement putting ideas in people’s heads and so I will be contacting the oil company – Total – myself and demanding its immediate removal (I will play the corporate responsibility card, that they should do the right thing, as well as the self-interest one, advising them that they could be sued if a high-as-a-kite customer snaps their wrist in a green-ink frenzy.) My main concern, however, is for the person who created the advert; but is it a Total staffer or an employee from an advertising agency? We need to know, because we need to track them down. Whether the author personally imbibes Red Bull while reading the Melanie Phillips column – a chilling thought – or just thinks it is a socially and/or medically responsible thing to do, here is someone who is clearly a danger to themselves and others.

But how do we do it? How can we identify this trouble soul? There were no clues on the advert itself; no credits, no copywrite symbol, no identifying marks of any kind as far as I could see. We don’t even know when this specific advert was made; the date on the copy of the Daily Mail was obscured, and the banner headline, “‘Why the English middle classes have had enough,’ by Simon Heffer” doesn’t narrow things down at all. They publish a similar article every other week: the specific article in question, if even uniquely identifiable, could have been from anytime in the last twenty-odd years.

Can you help? Please? A Red Bull drinking Daily Mail reader is a ticking time-bomb that will eventually blow, and when it does I want to know that I have done everything humanly possible to have prevented it.

πr²

They say Pensioner Pie is back in style. I say it never went out. Of style.

What A Shower

Fund manager Mark Mobius of Templeton Asset Management was interviewed about investing in emerging markets on the BBC’s Working Lunch programme last week. The interviewer, Nik Wood, began by asking just what an emerging market is.

It was actually the IFC, the International Finance Corporation at the World Bank. They were struggling with what to do with these underdeveloped countries, the poor. They were referred to as underdeveloped, poor, the South, so forth and so on, and … one gentleman from the IFC was in his shower in Washington one morning and he came up with the idea of emerging market which was a more optimistic name.

The shower? I have to wonder what IFC man was up to in the shower when the word “emerging” popped into his head, but I really don’t think I want to know.

What Do You Get If You Multiply Six By Nine?

David Davis’s decision to stand down as an MP and fight a by-election on the subject of civil liberties, be it brave, foolish, principled or vain (and it is probably all four), will only become interesting to me in the unlikely event that it resolves some of those unanswered questions raised during the debate over 42-days detention. I have to doubt that Davis can provide me with those answers by fighting shadows in a by-election when a he didn’t manage it as shadow home secretary, but if he pulls it off he will have done me a great service.

I think I am a bit erratic on the matter of civil liberties. I am dead against ID cards, although for now it is mainly for the pragmatic reason that they are a monumentally ineffective waste of time and money. I similarly oppose the proposed database that will run alongside the cards, but I can see some worth in the similarly gargantuan NHS “spine”. The DNA database’s reach is far too extensive, but the profusion of CCTV cameras, whether state or privately owned, does not leave me over-fussed. On the matter of detention without charge I opposed the extension to 90 days in terror cases and I oppose the 42-day move now. I’m all over the place really, although perhaps no more than David Davis himself, a curious “libertarian” who despite his recent protestations is socially conservative and an authoritarian on many issues, supporting the repeal of the Human Rights Act and also – as many have pointed out – in favour of the death penalty. So while he is appalled by the metaphorical “slow strangulation of fundamental British freedoms” he is far more relaxed about the literal, brisker, honest-to-goodness strangulation of a human being in a noose. He is against the state retaining our DNA and storing it in a vial but is happy to afford it the power to erase us from the face of the earth.

It is easy to pick holes in what passes for the government’s case for 42-days. I have little doubt that Labour’s main reason for pushing the bill forward was political, to triangulate and to sound tough on terror while painting the Tories as weak. Certainly it is the case that some terrorists have been held right up to the current 28-days limit – just as the previous limit of 14-days was occasionally approached – but isn’t that the way with deadlines? If I am given 4 weeks to complete an assignment then it will take me 4 weeks; give me a 2-week extension and it will take 6 weeks.

And yet; I am not whole-hearted in my opposition to this bill, primarily because as I have no experience of investigating a terror plot I have no knowledge of what it actually entails. Certainly the government hasn’t effectively made the case for why the change it is needed, but the opposition hasn’t convinced me that it isn’t. It is an unpleasant feature of our parliamentary democracy that the whips operate to push MPs through the lobby to vote for their party rather than with their conscience and some of the reported horse-trading in last week’s vote reflects badly on the government, but I have heard far worse cases of bullying and intimidation under previous votes and governments; the whips work on both sides and it would be interesting to see how a genuinely free vote would have gone when many Tory MPs would have voted for 42-days rather than against the government. Much of the opposition case seems to be shrill and hyperbolic, to exhibit some unavoidable gravitational pull towards Latin, where Magna Carta, habeas corpus and cave canem get waved around for no very good reason, and where opposing 42-days is made to sound synonymous with supporting civil liberties. Sure, many of those in favour of 42-days can also some make utterly stupid points in response by, for example, saying they don’t care how long terror suspects are banged up for as long as we are kept safe, but I can easily dismiss such Daily Mail-style wing-nuttery as I don’t feel the need to understand and sympathise with such rabid nonsense. Not so the arguments made by liberals, and David Davis; but the latter’s speech to parliament in the debate on the bill was typically full of emotive talk of innocent people being dragged from their homes in the early hours and hurried away from their famillies and jobs to be slammed in a cell for weeks on end; true, of course, and uncomfortable to admit perhaps, but these facts apply as equally to the 28-day limit which Davis supports as to the 42-day limit he opposes.

But it is when the bills opponents compare the UK’s record with other countries that I become most concerned about the arguments being made. It is commonplace to blithely state that we already have the most draconian terror laws going, and Liberty published a document detailing how out of step the British legal system is, but what does that mean? Some things don’t seem to add up. Italy, for example, is said to be able to make do with a mere 4 days detention prior to charge, yet in the Meredith Kercher case I remember it being stated that the suspects can be held for up to a year pending investigation, the 4 day limit apparently being for the courts to authorise the initial arrest. Italy is a civil-law country and so the comparison may not be exact (which is part of the problem here) but what of other common-law countries? In the United States, when not being held indefinitely in Guantanamo Bay, Liberty state that suspects can only be held for 2 days prior to charge, but again comparisons seem misleading. My understanding is that in the States it is the norm to charge suspects with a lesser crime and then use post-charge questioning to get at the real reason for the arrest; but is that really any improvement on the British system? It doesn’t seem a victory for civil liberties if we move over to a procedure where you can be arrested for some trumped up trifle – tax evasion…jaywalking? – and to then be held for as long as a friendly judge refuses bail. You still won’t know why you have really been arrested, you still can’t prepare your defence for the genuine case ahead, and it all seems to lead to a far less transparent system, with nothing like the judicial oversight that exists in the UK. In Canada, another common law country, under most circumstances charges actually need to be laid prior to an arrest – which certainly suggests a low level of evidence is required – and anyway within 24 hours. It beggars belief that the Canadian and British police are working under truly comparable systems or else we have to believe that our coppers are 42 times more lazy than the Canadians; but I guess I don’t know.

My problem here is that while I instinctively support Liberty in its endeavours some of its claims seem disingenuous which undermines the case, as if they are playing fast and loose with the evidence in order to take a utopian line on civil liberties. It is easy to oppose 42-days on a high-minded principle when it isn’t your arse on the line if the current 28-day limit means you have to let a genuine terrorist go free; easy to tell others how to do a job you have no intention of doing yourself and to still keep yourself free to criticise if things do go wrong; easy enough to do it and stay put. No, the antis haven’t convinced me of their case; ultimately it comes down to how much time the police actually need to do the job, and that is something I simply don’t know.

But the antis don’t have to convince me, it is the pro-42-dayers who are seeking a change to the status quo, it is they who have to do the convincing. Some senior police officers may well want more time to question suspects, but who wouldn’t like more time in which to do their job? Just because they want it doesn’t mean they need it; if the police are given 42 days then they will certainly use them, but while that could be out of necessity it is as likely to be out of risk-aversion, to continue to hold people against whom there is no evidence just to be on the safe side. Neither side in this argument has persuaded me, but liberty is too vital an issue to take lightly. As in law, then, it is for the Crown to make its case beyond reasonable doubt. This is something it has signally failed to do.