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Re: CO2 is a killer!

The EU has almost nothing to do with fiscal policy and neither did most of the pre-euro central banks! I can think of two market-bucking consequences for taxation of EU membership - the general prohibition on reduction of VAT rates (which I think is crazy) and restrictions on public borrowing by Eurozone countries (growth and stability pact), which is eminently sensible. Governments shouldn't be able to buy votes today by making tomorrow's taxpayers foot the bill.

As for continental restrictions on freedom of employment, I think this was a mistake on the part of the western continental countries, Britain did the right thing in opening its labour market. Russia is not part of the EU and Bulgarians do not yet have unrestricted access to the UK job market so it's more likely you're hearing Polish or Czech in your supermarket. Cool. The only Poles you'd have met 20 years ago would have been cruising London in a black Zil with diplomatic numberplates. All the western continental countries have to do the same thing by 2011 at the latest anyway, so they are merely delaying the inevitable.

I'd love to hear an explanation of how protectionism in the labour market makes you better off. After all, it makes life more expensive for the consumer in everything else, why should selling labour be subject to special restrictions? I presume you're happy that free and competitive markets have reduced the cost of your energy, food, car etc. Why shouldn't the same thing apply to labour? As an employer you can cast your net far wider to find better (and cheaper) staff, while as an employee you have more opportunities than ever before.

I don't think the EU being made up of "quite different people" is remotely relevant. Not to mention the fact that the continued existence of Switzerland gives the lie to the idea that disparate peoples are incapable of living together, co-operating with each other and sharing the same rights and responsibilities, you could say the same thing about Dorset and Northumberland. In fact you could say the same thing about Dorset period. We are all individuals now, I identify primarily, to varying degrees, with my family, my friends, my employer, my colleagues and my neighbourhood. My countries of birth (UK), current residence (Germany), previous residence (Italy), and indeed Europe as a whole are a long, long way down the list of labels I apply to myself. Mostly they're just things I receive tax demands from. I'd lend my neighbour €100 because he's my neighbour (and I have a reasonable chance of getting it back). I wouldn't lend an English guy €100 just because he's English, and I suspect you feel the same. So in what way does my nationality define me, or demand of my allegiance? It's almost completely irrelevant. I think of myself as Mancunian before English. I don't think having freedom of movement between Latvia and Portugal is any different to having freedom of movement between Poole and Newcastle. Conservative Anglicans in Huddersfield and conservative muslims in Bradford manage to share a county with the gay hippies in Hebden Bridge, so I think we can learn to share a continent with people with political, religious and economic views which differ from our own. In fact, I don't think we have a choice but to learn how to do this.

Re: Re: CO2 is a killer!

Actually I have known poles for some time. Notably a Polish Paratrooper who came during the war and did not go back.
It seems from today's news that many Poles holidaying in Poland have decided not to come back.
The idea of the market being made up of completely different people is very relevant. It is exactly that which made the choice of Wm Duisberg so problematic as the French and German views on monetary policy were/are so very different.

Re: Re: CO2 is a killer!


I'm not entirely sure that the relatively low cost of, for example, food in recent times in the UK can be attributed to free and competitive markets without also observing that those same markets are now providing a complete reversal of the trend that has in a very short time just about wiped out any fiscal benefit we may have gained from the previous few years.

Food and energy have certainly seemed to go that way. I don't think we ever had cheap cars in the UK but that's another matter. In engineering is seems that various forms of consolidation have have more effect than market freedoms with a lot of effort being made to spin the concept of increased choice when in fact the options have been reducing.

As an employee I'm not sure there are more employment opportunities either, certainly not by type of job, though the number of call centres has increased noticeably.

I can't quite see the point of encouraging free movement of labour if it means paying more of the previously resident population to do nothing. Likewise importing skills that can just as easily take themselves elsewhere as other countries 'liberalise' their labour controls rather than training and retaining skills using people who are perhaps less likely to dpeart fo new pastures seems like a recipe for potential and sudden disaster a short way down the line. Still, as with the NHS, make enough money available and people will see personal benefits in the economics of flying in for a weekend's work on a regular basis.

I guess that just leaves the ever increasing costs of attempting to extract taxes from those who have moved on. As you point out it may be those demands following people around Europe, or perhaps the world, that eventually provide some semblance of 'belonging' for many people.

None of this is new, though the scale and speed of change may be without prior experience.


Re: CO2 is a killer!

Disagreement between the French and German governments on monetary policy is also of minimal relevance. Every government which signed up to the Euro knew what the deal was - the ECB would be independent (as far as possible) of political interference and set interest rates to control inflation - i.e. modelled on the Bundesbank/Bank of England. Now I don't read all of the small print every time I sign a contract, that's what I employ politicians to do! The value of the euro and its effect on exporters can go hang - it was introduced primarily to facilitate trade amongst a group of countries that do most of their trade with each other and surprisingly little with the outside world - with the exception of Germany which is the world's biggest exporter, and isn't having any more problems with a strong Euro than it did with a strong Deutschmark. The euro wasn't introduced to make life easy for the handful of club med exporters who were only competitive with a perpetually devaluing currency - and governments that complied by printing more money every time things got tough.

How has encouraging the free movement of labour resulted in you paying more of the British indigenous population to do nothing? I was given to understand that unemployment claims have gone down recently. Labour was moving into the UK because there was work to be done and no-one to do it. Importing labour isn't an alternative to "training and retaining" - indeed freedom of movement provides a huge incentive to employers to train their staff and retain them by paying them properly. If I were desperate for a pay rise I could simply entertain the advances of the next headhunter who calls, fly off to Latvia or Sweden or wherever for an interview, come back armed with an offer and ask for more money or leave. Similar pressures work in lower skilled jobs too even if the wheels turn a little slower - but ultimately if there is better money available elsewhere, people will follow it. The NHS pays the "Ryanair locums" a rate dictated by the market. It's a lot of money because the rest of the package is crap - I spent most of my academic career in UK hospitals and they are very unpleasant places to work. Doctors get very few perks from their employers that most equivalent professionals in business would take for granted - so they demand more money than said professionals instead. If the NHS were likewise free of government restrictions (namely foreign-trained doctors are at a severe disadvantage and effectively forced to work at lower grades than they are qualified for) it could instead think about taking on overseas doctors on a more permanent basis, which would reduce the cost of employment considerably. As usual, it's governments getting involved in the transactions which people freely enter in to which screws things up.

The whole aim of a free labour market is to widen the range of personal freedoms you and everyone else enjoys. You aren't forced to work in Sweden, or Poles to work in Britain - you just have the option. If you don't want it then don't exercise it, but don't take it away from people that do want it. Raise the drawbridge and you could hypothetically have 5.5 million expatriate Britons repatriated. You won't make room for them by kicking out the Poles and Czechs.

Re: CO2 is a killer!

Market prices for energy, food etc are going up because the raw materials costs are going up. The costs would be yet higher under the old system of monopoly suppliers because they would still have to cover their costs. Iran and Venezuela famously have extremely cheap and subsidised fuel - but are now having to ration it because the governments have finally understood the concept of opportunity cost. A barrel of oil burned in an Iranian car which is inefficient because there is no incentive to reduce fuel consumption is a barrel of oil that hasn't been sold for hard cash to an overseas customer. The same would happen if you ended up with the UK government subsidising fuel bills in the wake of recent price increases. Someone has to pay for it - and the full cost of using it - in my political and economic philosophy that should usually be the person using it. Socialising costs is something that should only be considered when there are overwhelming reasons to do so and people cannot be persuaded to socialise "by consent". The cost of rebuilding my house should it burn down is one I socialise by consent by buying insurance. Health insurance is arguably something I should be forced into by the government because now in my youth, I would be much better off just to pay for my ~annual visit to a doctor than extortionate socialised health insurance, but in 40 years time I will probably not be able to afford all the care I need out of pocket. I'm not satisfied that I should be subsidising anyone's gasoline bill either directly or through expecting the exchequer to forfeit an opportunity cost (which has the same effect of increasing my tax bill).

Re: Re: CO2 is a killer!

Venezuela has abundant resources of oil and especially the Orinoco basin. The problem for them is Huog Cahvez, one of Red/Green Ken's friends.
He has done enormous harm to the oil industry there and virtually de-skilled the industry.
One product especially was Orimulsion. Hugo has proven a difficult man to deal with.
Take a look at the New Brunswick power company problems .
Hugo was using his "cheap" fuels to try to undermine the US economy. He then decided to sign an exclusive deal with China for the supply of Orimulsion. They even set up a brand new facility. Then Hugo cancelled the deal leaving China in the lurch and prompting them to have to try and purchase Heavy Fuel oil on the open market. Significantly more expensive the sudden demand from China pushed the price still higher. This at a time when crude prices were rising already (which prompted Hugo to reclassify Orinoco crude and hence cancel the orimulsion deals).
So Venezuela at least has not made any prudent regulation of oil exporting and his internal refining capacity is a mess.

Don't buck with me!

Yeah, never underestimate the power of a government to screw its citizens. If Venezuela sold its oil on the open market rather than using it as a crude (pun intended) political tool, it could be a much richer country. But if Venezuelans really are so infused with socialist ideaology to the degree that they're prepared to sell their property for less than it's worth, then why should I stop them? I see this (and indeed the ever-expanding remit of government in general - from something most people ignored 200 years ago to 50% or more of the economy and 90% of the evening news these days) as a problem with democracy. Anything, even monumentally stupid things, can get passed if you have the consent of a majority - or more usually the consent of the largest minority, but we know that in the real world things should not be decided by weight of popular opinion (or indeed its contrary). God doesn't exist just because a referendum on the issue would probably produce a "yes" vote - if anything the lesson of history is that most people are wrong on most things most of the time - I don't consider myself to be an exception. I wouldn't like to argue against democracy, I believe it was Churchill who described it as the least worst way to govern and in considering the alternatives I agree - but the fact that any agenda can be hijacked by a vocal minority who are tolerated by an apathetic majority needs to be addressed, before we end up with governments running everything, income tax at 100% and bureaucrats deciding what car you'll drive (or rather which yak you'll ride) to which socialist free-store and what goods you'll take home for your reguation meals - irrespective of which party you put in office. A free society is not one in which you get to choose who makes the rules - its one in which you get to make the rules yourself as far as possible.

Thatcher was wrong when she said you can't buck the market. You certainly can - just watch the Fed, ECB and BofE. But when you try to buck a market, someone has to pay - usually not the person doing the bucking but everyone else, which is why hardcore liberals like myself hate governments (or anyone else) manipulating markets absent a very solid justification of why it is in the common good to do so.