A Place to Stand

This was the letter, referred to on Wednesday that I sent to several newspapers on the reason why childcare costs are rising 4 times faster than inflation. According to Google news it remains unpublished.

The Daycare Trust, a largely government funded charity, has reported that childcare cost is rising 4 times faster than inflation & explicitly calls for government subsidy. Why exactly such costs should be rising so spectacularly is not addressed by them, or indeed by newspapers & broadcasters reporting them. However experience suggests that when such an unexplained & substantial increase happens it is almost always because of government regulation. House prices have risen 4 fold above the Retail Price Index over the last century because of planning restrictions & the mandating of Victorian building techniques. Our electricity costs 4 times what the French pay for their's because the government has insisted on windmills rather than nuclear power. Hardly surprising then that mothers are unable to work because their after tax incomes would be less than their childcare costs.

The answer is obvious & does not involve more government interference

The fact that it was not published does not lead me to think I have not got it right - quite the contrary. I do not see any technical reason why looking after pre-schoolers should cost significantly more than looking after & educating school children in the cheaper private schools & must put it down to bureaucratic regulation. That such answers cannot even be mentioned in an obedient media which will censor any fact whatsoever in the state's interest does not in any way reduce the likelihood of them being true.

Here are excerpts from Vladimir Putin's speech to Davos (via Jerry Pournelle & the WSJ) my comments in italics

I would like to thank the forum's organisers for this opportunity to share my thoughts on global economic developments and to share our plans and proposals.

The world is now facing the first truly global economic crisis, which is continuing to develop at an unprecedented pace.

The current situation is often compared to the Great Depression of the late 1920s and the early 1930s. True, there are some similarities.

However, there are also some basic differences. The crisis has affected everyone at this time of globalisation....

Although the crisis was simply hanging in the air, the majority strove to get their share of the pie, be it one dollar or a billion, and did not want to notice the rising wave.

....Today, investment banks, the pride of Wall Street, have virtually ceased to exist. In just 12 months, they have posted losses exceeding the profits they made in the last 25 years. This example alone reflects the real situation better than any criticism.

The time for enlightenment has come. We must calmly, and without gloating, assess the root causes of this situation and try to peek into the future.

In our opinion, .... Substandard regulation has contributed to the crisis, failing to duly heed tremendous risks.

Add to this colossal disproportions ... between the scale of financial operations and the fundamental value of assets, as well as those between the increased burden on international loans and the sources of their collateral.

The entire economic growth system, where one regional centre prints money without respite and consumes material wealth, while another regional centre manufactures inexpensive goods and saves money printed by other governments, has suffered a major setback.(the inevitability of that being understated)

I would like to add that this system has left entire regions, including Europe, on the outskirts of global economic processes and has prevented them from adopting key economic and financial decisions.

Moreover, generated prosperity was distributed extremely unevenly among various population strata. This applies to differences between social strata in certain countries, including highly developed ones. And it equally applies to gaps between countries and regions.

A considerable share of the world's population still cannot afford comfortable housing, education and quality health care. Even a global recovery posted in the last few years has failed to radically change this situation.

And, finally, this crisis was brought about by excessive expectations. Corporate appetites with regard to constantly growing demand swelled unjustifiably. The race between stock market indices and capitalisation began to overshadow rising labour productivity and real-life corporate effectiveness.

Unfortunately, excessive expectations were not only typical of the business community. They set the pace for rapidly growing personal consumption standards, primarily in the industrial world. We must openly admit that such growth was not backed by a real potential. This amounted to unearned wealth, a loan that will have to be repaid by future generations.

I would first like to mention specific measures which should be avoided and which will not be implemented by Russia.

We must not revert to isolationism and unrestrained economic egotism. The leaders of the world's largest economies agreed during the November 2008 G20 summit not to create barriers hindering global trade and capital flows. Russia shares these principles.

Although additional protectionism will prove inevitable during the crisis, all of us must display a sense of proportion (indeed & he is here accepting Obama is going to be forced into some protectionism by political rather than economic realities & saying he will not make things worse by retaliation as long as it is not outrageous - that is an undeservedly good offer).

Excessive intervention in economic activity and blind faith in the state's omnipotence is another possible mistake.

True, the state's increased role in times of crisis is a natural reaction to market setbacks. Instead of streamlining market mechanisms, some are tempted to expand state economic intervention to the greatest possible extent.

The concentration of surplus assets in the hands of the state is a negative aspect of anti-crisis measures in virtually every nation.

In the 20th century, the Soviet Union made the state's role absolute. In the long run, this made the Soviet economy totally uncompetitive. This lesson cost us dearly. I am sure nobody wants to see it repeated.(an amazing & correct denunciation of the USSR's socialism & of the policy now being pursued by Gordon Brown among others & an explicit call instead for free marketism & the rolling back of the state)

Nor should we turn a blind eye to the fact that the spirit of free enterprise, including the principle of personal responsibility of businesspeople, investors and shareholders for their decisions, is being eroded in the last few months. There is no reason to believe that we can achieve better results by shifting responsibility onto the state. (no British party leader nor US Democratic politician express such classic liberal sentiments)

And one more point: anti-crisis measures should not escalate into financial populism and a refusal to implement responsible macroeconomic policies. The unjustified swelling of the budgetary deficit and the accumulation of public debts are just as destructive as adventurous stock-jobbing.(suck on that Gordon)

....This means we must assess the real situation and write off all hopeless debts and "bad" assets.

True, this will be an extremely painful and unpleasant process. Far from everyone can accept such measures, fearing for their capitalisation, bonuses or reputation. However, we would "conserve" and prolong the crisis, unless we clean up our balance sheets. I believe financial authorities must work out the required mechanism for writing off debts that corresponds to today's needs.(I suggest this means the bankruptcy of some banks - if so I agree)

Second. Apart from cleaning up our balance sheets, it is high time we got rid of virtual money, exaggerated reports and dubious ratings. We must not harbour any illusions while assessing the state of the global economy and the real corporate standing, even if such assessments are made by major auditors and analysts.

In effect, our proposal implies that the audit, accounting and ratings system reform must be based on a reversion to the fundamental asset value concept. In other words, assessments of each individual business must be based on its ability to generate added value, rather than on subjective concepts. In our opinion, the economy of the future must become an economy of real values. How to achieve this is not so clear-cut. Let us think about it together.

...it would be sensible to encourage the objective process of creating several strong reserve currencies in the future.(a dig at the $)

...I am convinced that we can build a more equitable and efficient global economic system. But it is impossible to create a detailed plan at this event today.

...Three years ago, at a summit of the Group of Eight, we raised the issue of global energy security. We called for the shared responsibility of suppliers, consumers and transit countries. I think it is time to launch truly effective mechanisms ensuring such responsibility.(Hardly running a monopolistic gas policy as the Russians are accused of)

...I propose we start laying down a new international legal framework for energy security. Implementation of our initiative could play a political role comparable to the treaty establishing the European Coal and Steel Community. That is to say, consumers and producers would finally be bound into a real single energy partnership based on clear-cut legal foundations.(this would prevent Ukraine stealing gas, but it would also stop Russia playing politics with gas & the Coal & Steel Community was how the EU was formed so it is offering a very co-operative relationship)

... the strategy itself, which is to effect a qualitative renewal of Russia in the next 10 to 12 years.

...We are also going to actively develop the innovation sectors of the economy. Above all, those in which Russia has a competitive edge – space, nuclear energy, aviation(2 of my hobbyhorses & clearly more sustainable than banking). In these areas, we are already actively establishing cooperative ties with other countries.

...I believe that the 21st century economy is an economy of people not of factories....We are already a highly educated nation. But we need for Russian citizens to obtain the highest quality and most up-to-date education, and such professional skills that will be widely in demand in today's world. Therefore, we will be pro-active in promoting educational programmes in leading specialities.

...Unfortunately, we are increasingly hearing the argument that the build-up of military spending could solve today's social and economic problems. The logic is simple enough. Additional military allocations create new jobs.

At a glance, this sounds like a good way of fighting the crisis and unemployment. This policy might even be quite effective in the short term. But in the longer run, militarisation won't solve the problem but will rather quell it temporarily. What it will do is squeeze huge financial and other resources from the economy instead of finding better and wiser uses for them.

My conviction is that reasonable restraint in military spending, especially coupled with efforts to enhance global stability and security, will certainly bring significant economic dividends.(he knows that lack of restraint in military spending was a major cause of the USSR's economic decline)

The world has lately come to face an unheard-of surge of violence and other aggressive actions, such as Georgia's adventurous sortie in the Caucasus, recent terrorist attacks in India, and escalation of violence in Gaza Strip. Although not apparently linked directly, these developments still have common features.

...Frankly speaking, we all know that provoking military and political instability, regional and other conflicts is a helpful means of distracting the public from growing social and economic problems. Such attempts cannot be ruled out, unfortunately.(Frankly speaking we know that the US particularly provoked Georgia into it's adventure)

To prevent this scenario, we need to improve the system of international relations, making it more effective, safe and stable.

We must seek foothold relying on the moral values that have ensured the progress of our civilisation. Integrity and hard work, responsibility and self-confidence will eventually lead us to success.


I can see why 70% of the Russian people voted for him. I am assuming that the speech was composed collectively by the best in the Russian government, but, like his previous security speech he shows more understanding of the real issues & more commitment to progress than the entire front benches of all 3 parties put together. I would vote for him too.

Holyrood voted down the SNP's budget last night.

The 47 Scottish National Party MSPs voted for the budget, as did the 16 Tories, who were offered £60m for their town centre regeneration plan.

Labour demanded more cash for apprenticeships, but said the deal they were offered fell short, while the Lib Dems' call for a 2p income tax cut was rejected at an earlier stage.

The government was banking on the support of the two Green MSPs, who wanted a 10-year, £100m-a-year free home insulation package.

Finance Secretary John Swinney offered a £22m pilot scheme, which he offered to raise by several million just minutes before the vote
Looks like the Tories let themselves be bought very cheaply at only twice what the Greens turned down.

Now I fully support the LudDims turning it down because it doesn't offer a 2p income tax cut which would indeed do more for our economy than anything else proposed by any of these parties. Actually they should go for the full 3p since administrative costs are the same so a 3p cut gives better value. Indeed I stood for election as the sole candidate calling for a 3p reduction - though while the LDs refuse to say where the money would come from I did - end the £1 billion windmill subsidy.

This could be a very popular measure - if they genuinely could stand for election calling for cutting income tax they would win big. Their problem is that, not being liberals, they don't. Indeed the party is officially on record as saying that cutting taxes is "illiberal" & incompatible with party membership".

They have introduced this promise cynically, simply to get votes & hoped, by voting against the Scottish government on that basis to get a little publicity or even a lot if Labour had done as expected & sat on their hands. Presumably Labour also decided publicity is good. Instead they have brought the house down, much of it landing on them. Now Tavish is desperately backtracking:

but now they're back in the room. Mr Scott noted that there might be scope for discussion of longer-term economic objectives.

Mr Salmond's tone in response was notably emollient, while expressing the hope that the 2p tax cut was buried

After all the last thing the LudDims want is to fight an election on radical liberal principles & the 2nd last thing they want is to be wiped out in an election fought on them being even more Luddite, anti-growth, pro-windmillist than the other parties.

I wish the Conservatives would grow some balls & actually (A) put forward some economically sane policies since Scotland desperately needs some & (B) charge a bit higher for their favours - a PR system rightly demands compromise, but you compromise only after you have decided what you ideally want & you don't sell your inheritance for a mess. Like the SNP & unlike Greens, LudDims & Labour, do not fear an election & would fear it less if they dared stand for something.

Perhaps once Tavish has backed out of the 2p cut they could endorse a 3p for next year & invite the LDs to join them in standing up for it (or possibly just 2p) next year.

The BBC reports

Many parents in Britain are paying in excess of £8,000 a year for a full-time nursery place, a survey suggests.

The Daycare Trust found the yearly cost of a typical nursery place for a child under two was £8,684 in England, £8,216 in Scotland and £7,592 in Wales.

...It comes as the government has published a review of childcare in England, in an attempt to make the system more flexible and affordable and to ensure standards remained high.

.....Daycare Trust joint chief executive Emma Knights said: "Yet again the cost of nursery places has increased above inflation, making pre-school education a big drain on family budgets at a time of financial uncertainty.

"It is crucial that parents claim all the help they are entitled to, and that the government increase the free childcare entitlement to include all two-years-olds.

"The current review of tax credits should increase the maximum proportion of childcare costs the poorest parents can claim from 80% to 100%."

I will leave the reason why this faster than inflation rise is happening for a day or two to give various papers a chance to publish my letter on the subject.

The other side of this story is the incestuous media manipulation going on.

The BBC describe the Daycare Trust as a charity, which is legally the truth but not the whole truth. Via Mark Wadsworth we find that of the £1.1 million they get in they get £57,000 from 2 Nuffield Trusts & the rest is £612,000 donations from government agencies; £186,000 from consultancy which I am willing to bet is virtually all government money; £9,000 for training, presumably training government employees; £67,000 for giving advice, to government employees, which apparently is not the same as consultancy; £37,000 for running conferences attended by - well I'd have to guess but could it be government employees; & £53,000 from sponsorship. part of which looks like Bovis sponsoring them rather than cut conference fees, that is a tax break & the rest from the usual suspects.

All in their accounts mainly page 13

QUANGO - Quasi-autonomous non-governmental agency. The Daycare trust is about as autonomous as a left sock. Nor does it appear any of its actions involve anybody actually meeting a child. One of their functions listed is a Childcare Week Party in the Park but I am cynical enough to suspect this was a party involving the great & genocidal rather than a party for kids.

What we see is a report from a government controlled advertising organisation masquerading as a charity getting advertising airtime from the BBC, a government controlled propaganda organisation masquerading as a "news" broadcaster, though their press release went out from the press association & was reported in the Guardian, the Telegraph & Nursery World (the Guardian is also effectively a quango since, like all newspapers, it survives more on adverts than purchases & unlike the rest it can easily be seen that its advertising is not by ASDA but government job adverts).

This morning the radio phone in was on this "story" which most of the real MSM have ignored. Surprisingly the BBC commentator actually asked why these costs were going up but nobody phoned in to answer. Actually I did but nobody was in - or at least answering their phone. The BBC identify callers numbers & thus names & know what we have said previously! The general consensus, as BBC consensii are, was that more government money should be spent on subsidising childcare, with a bit more regulation to stop nurseries profit gouging.

I even have a little Yes Ministerish sympathy for Ministers who often benefit from government advertising but in this case look like they are being bounced by the bureaucracy.

Children's Minister Beverley Hughes said the survey was based on parents requiring 50 hours of childcare all year round for under-fives, which was "more than most parents take up or want".

which is a point which quite obviously negates the entire "research" & suggests that in this case the Minister (or at least this Minister) was not in on it.

We have seen the same phenomenon in the eco-fascist movement (Friends of the Earth, Europe being almost wholly funded by the EU & members & being appointed as preferred advisor on whether the EU bureaucracy should get bigger) & in the government financing of ASH & the "consultation" on the smoking ban. This is known in advertising circles as astroturfing since it simulates grassroots action. It may be there are some real people in the various fascist (eco-, health, bombing foreigner-, socialist-, movements (though even the Labour party, once a genuine mass party seems to have few party workers who aren't councillors or paid in some way by them). However the default position should be that any body calling for bigger government & more regulation should be assumed to be paid by the government until they prove otherwise - they usually are.

I decided to have a look at figures on how effective our Heath & Safety Executive is.

Their website gives the number of accidental deaths last year says 229 workers were killed at work, a rate of 0.8 per 100 000 workers which at first glance looks like a significant improvement over the 651 employee fatalities for 1974 (the year they were formed). That is a reduction of 422 deaths. However they do admit "recent research suggests that about 50% of the reduction in non-fatal injury rate since 1986 is due to changes in occupations of workers" - that means 211 deaths or an expected rate of 440. However we have seen a major change in health care over the years which has seen the murder rate slightly drop though knife & gun attacks are up. Assuming that improved A & E care saves 25% we should expect a death rate of 330.

So on paper the HSE saves 101 lives annually.

Not the biggest factor. Not even as many lives saved as the toothpick industry kill according yesterday's renewablist item. Indeed it is not even enough to say that this is beyond the limits of random statistical variability - or to put it another way there may be no positive effect at all, particularly seeing that (3 million jobs in manufacturing have disappeared, while the service sector now employs 83% of workers).

Which doesn't mean they have had no effect.

The rule of thumb is that every £1 spent on enforcement means £20 cost to those "supported" in this way. That looks like 4 million workers & everything they produce then out of 26.4 million That assumes that the costs are borne equally by all whereas it is quite likely that the cost fall much more heavily on productive industry than government deskworkers. Still it means our effective workforce could increase from 22.4 to 26.4 million - an 18% increase. In the short to medium term this could increase GNP proportionately - in the long term this increased economic efficiency would also push up our long term growth rate, but I am going to ignore that too.

Which brings us to something I saw, via Mark Wadsworth recently

A British Medical Journal study several years ago examined income inequality and its effect on mortality. It estimated that a 1 per cent difference in income translated into 21 deaths per 100,000 per year.

The effect of this differs from a similar looking figure from the HSE that "The rate of fatal injury per 100 000 workers is 0.8" because this applies to everybody not just the workers.

Therefore the net loss of life, excluding any long term GNP growth effects, is 21 per 100,000 times times each of the 18 percentage points of productivity (21 x 620 x 18).

234,360 preventable deaths each year or the death of 234,259 people net annually caused by our "Health & Safety" bureaucracy.

I assume most of these will be pensioners who's lives would not be extended as much as health young workers (including most of the 24,000 excess winter deaths caused by fuel poverty) but that is a minor matter. It is, when looked at properly, a horrendous & totally unnecessary toll created purely because, in looking for ways to do minor good (& create government jobs) the immense harm caused by the inevitable side effect is ignored.

The correlation between national wealth & health & measurable happiness is clear & economic success is certainly the most important factor. The fact that the eco-fascists, health-fascists & general busybodies subsidised by government to push for bigger government ignore it merely proves how egregious they are. Considering the harm they do firing the lot of them tomorrow would not be unkind.

Last Sunday Ewan Morrison in Scotland on Sunday wrote an article saying how beautiful windfarms are & attacking the Caithness Windfarm Information Forum for publicising the number of deaths worldwide from windmills - 52. He is perfectly entitled to his standards of beauty & the number of deaths is not particularly high for such projects & he is entitled to say so - so long as he is consistent. I sent them this letter:

In defending windfarms Ewan Morrison (article Sunday) says that the 52 deaths caused by wind turbines worldwide are unimportant because "Wow, you'd be hard pushed to find anything that killed that few. Perhaps choking on a toothpick".

May I help him out with another example. This is the same number who died in the Chernobyl "disaster" in 1986. To be fair in making comparisons we should acknowledge that, in the years since, while producing nearly 20% of the world's electricity, a further 2 people have died in one accident in Japan. Well done to the wind industry in matching nuclear's total accident record while producing nearly 1% as much power & at only 10 times the cost.

They didn't print it which is their right & I wouldn't be making a point of it here. Firstly it was seen by 2 people whose opinion I respect & who certainly a publishable letter when they see one & they both thought they had seen one.

A perhaps more useful reason for putting this up is to link to & repeat their accident list. The comparison with nuclear is, as I said, or perhaps even a little more supportive of nuclear since it has been pointed out that the Japanese accident* was a waste handling one not directly related to power generation & equivalent to any accidents which may happen when windfarms are demolished:

Total number of accidents: 560

By year:

Year 70s 80s 90-94 95 96 97 98 99 00
No. ----1 --8 ----17 -5 -9 16 -8 33 28

Y01 02 03 04 05 06 07 08
N11 64 49 50 49 48 72 82

Number of fatal accidents: 52

By year:

Year 70s 80s 90-94 95 96 97 98 99 00
No. -----1 --8 -----8 -0 -2 -4 -0 -1 -3

Y01 02 03 04 05 06 07 08
N-0 -1 -3 -3 -3 -5 -4 06

More details on the accidents available in pdf here

*September 1999: Two workers are killed in a radiation leak at a fuel-reprocessing plant in Tokaimura when they try to save time by mixing excessive amounts of uranium in buckets instead of using special mechanized tanks. Hundreds are exposed to radiation, and thousands of residents evacuate. The government assigned the accident a level 4 rating on the International Nuclear Event Scale ranging from 1 to 7.

http://www.boston.com/news/world/asia/articles/2007/07/17/japan_nuclear_accidents_glance/

From memory there were 3 workers present - the 3rd one made a full recovery, which tends to discredit the promises from the Luddites that, though hundreds of thousands have failed to die at Chernobyl they will start doing so real soon.

Andrew Marr's show today interviewed Ken Clarke & Nick Clegg in separate interviews.

Clarke said that he didn't think government should be picking winners in the economy to support. There is a lot of evidence that he is right & that government is less good at this than the market. He also talked of the need to decide "what sort of market economy" we should be aiming for when the recession is over - which is either very lukewarm support for a lot of market freedom or an unambiguous statement that free markets are the way to maximise success. To me it was the former but in the atmosphere of British politics it was closer to the latter.

Clegg then proved Clarke's point about picking winners by mentioning it & saying this was the point at which he, who has made tax cutting & free markets selling points for his "liberal" party, openly disagreed with Clarke. He said that the LudDims would insist on picking winners & that the winner would be renewable energy. This fits with Tavish Scott's speech I reported earlier. Ot does not fit with any claim to sanity. "Renewable energy" with the exception of hydro power is horribly expensive & unreliable & no developed economy can survive on it. It is a perfect example of politicians making economically insane decisions to please political interests.

Clegg was asked what values his party represented that should make people give him their vote & he replied:

"Fairness & a renewables revolution"

Taking "fairness" as being merely laying on with a trowel something nobody, in or out of politics has ever said they were against we are left with the only unique selling point of the LudDims is that their way out of recession would be to vastly increase the billions wasted on windmills & ensure the lights go out in a more massive way.

Clinically insane.

Then let us pray that come it may,
(As come it will for a' that,)
That Sense and Worth, o'er a' the earth,
Shall bear the gree, an' a' that.
For a' that, an' a' that,
It's coming yet for a' that,
That Man to Man, the world o'er,
Shall brothers be for a' that.

Bearing in mind that brotherhood is not the same as common government, nor should it be, we have come a long way in those 250 years. Birth or hereditary aristocracy is no longer treated as denoting worth (except in North Korea & among Kennedy's & the Labour cabinet): & that as a society we do care about wehat happens to people in Palestine, Congo or Yugoslavia (even if most of what we are told is still lies to promote the agenda of those in charge).

For the first time Man to Man the world o'er ordinary people can talk together, as I am doing now. Indeed the time is plainly coming when it will be more than merely this world.

We may despair of this or that war, or the inanities of people who get elected, or even more importantly than any individual, the hysterical scares (warming, anti-nuclear, Ludditry, foreign conspiracies) & ignorance promoted by our mass media but we have clearly advanced a very long way & the future is easier to see than in Burns' time.

Full listing of Burns' poems.