Category Archives: Economics

Extraordinary times

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I have the distinct feeling that today may mark a real seismic change in British and possibly even international politics.

It’s been indeed a very long time since any government (we’re working on the rumurs from Sky here so if it doesn’t turn out then it’s their fault) looked like rasing taxes on the top earners in society.

For over a quarter of a century we’ve been fed the line from a dominant neo-liberal agenda that if we lower taxes on the higher earners it encourages them an stimulates entrepreneurship. I’m not exactly sure what a few percentage difference on £150,000 a year or more is in terms of stimulus but like the 98% of workers in Britain, I’m not in that group and probably never will be so I can’t say.

We were told that allowing people to amass greater wealth would stimulate a trickle down effect making everyone better off. It was a sham and history will record that it failed miserably. I’m reminded of an old Ben Elton sketch from the 1980′s which summed it up rather nicely. These people with lots of money did go out spending, buying Japanese televisions and German cars. Sartorial and simplistic but not a million miles away from the truth.

I once came across an old Labour Party leaflet from the early 70′s while hunting through some old archives. Th curious thing about it was that the balance of trade featured as one of the main criticisms of the Heath Government. It struck me that I couldn’t remember the last time I’d seen such an economic terms in a leaflet from any party. Perhaps it’s indicative of the levels to which our deficit grew in the 1980′s that it’s just not mentioned anymore because it’s a bit taboo and with a devastated industrial base is never going to look good.

Neo-liberal economics failed. Trickle down principles turned out to be nothing but a sham of an idea to allow the already rich to get richer and perversely be subsidised by the poor.

A lot has been done over the last 11 years to address the deep social and economic problems brought about by such an economic regime but as good as they have been, there’s not been a time when the core principles have been challenged to such an extent.

This could be that time where we see a real shift away from the morally and intellectually bankrupt neo-liberal unfettered capitalism of the right. Away from a position where the system dictates society instead of the other way around.

Hopefully this will be the start of ‘trickle up’ economics. Putting the money in the hands of those who really do spend it in the economy, bringing about economic activity and growth where it is truly needed, not with investment companies and hedge funds but putting ordinary people in jobs providing goods and services that ordinary people need and use.

Here’s hoping then.

Perhaps I should do a spot of live blogging of the pre-budget report? That’s a thought.

One Laptop per Child – not a chance

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I truly hate myself for this as it’s hard to put down what was and still is a very worthy campaign but I’m going to predict that the One Laptop per Child scheme is doomed to failure after it’s European release on November 17th was announced on the BBC.

For those who aren’t aware it was a scheme to produce a laptop for under $100 that could be purchased in the order of millions to provide access to computing to children in the developing world.

It never did get down to the $100 price tag, arrived late, had distribution problems and since then has shifted away from trying to get mass orders from governments to a sort of charitable ‘person from richer country buys two, they keep one and the other is donated’ scheme.

A great idea but it wasn’t particularly successful when they rolled out the scheme in the US and if the BBC article is correct, a price tag of £268 will kill it because to be fair, for that price, it’s crap.

Unless you want a laptop that looks like one of those Leapfrog toddlers learning things with a pitiful 256Mb of RAM, an undisclosed x86 processor, 1Gb of “mass storage” ie a solid state hard drive and a weight of 1.5Kg then it’s not a runner.

The principle was great, if they’d got them to market a couple of years ago as planned then they could have made a killing and would have found a rich seam or Western buyers signing up for what would have been then, a not too bad bit of kit to pick up for the little one here and feel good about donating one to a less well off child in some far flung region of our planet but things are decidedly different now.

£268 will buy you a lot in the current market. Typing this as I am on an MSI Wind (rebadged as an Advent 4211) that cost £280 back in July with an Intel Atom processor 2Gb of Ram (comes with 1Gb, I had it upgraded) an 80Gb hard drive, all the connectivity of a OLPC plus bluetooth and comes in half a kilo lighter (actually it is a bit heavier than the circa 1 kilo that I bought because I have a replacement 6 cell battery that adds a bit more to the weight but it’s still not more than the 1.5Kg weight of a OLPC). You could get these for £250 (£220 from PC World Business briefly) at one stage but PC World/Currys put the price back up. You can get exactly the same model rebadged as a Medion Akoya from Morrisons for £250 with a 160Gb hard drive the other week.

You could get an Acer Aspire One for a lot less or a Celeron based Eee PC 904 for the lower end of £200 or two original Eee PC 701′s for £268 if you shop around which still out-spec the OLPC.

Faced with those real consumer choices no one but a few trendy dinner party liberal types who want to boast about their charitable nature are going to fork out for a OLPC machine.

Sad I know. Personally I wish it were otherwise because the original idea was a very noble one but the market has been overhauled in the last 12 months alone and I just don’t see it working anymore particularly as consumers will be looking for a lot more for their money in the current economic climate.

A book review: The Big Earth Book by James Bruges

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Every once in a while someone contacts me to review something so tonight folks, it’s book review time. “The Big Earth Book” by James Bruges, published by Sawday’s and printed by Cambridge University Press.

As it name suggests, it is qute big and I really should have penned this review a good three weeks ago but I’ve been busy undertaking (none shelf stacking) duties.

What’s it all about?

Well it covers a vast array of enviromental related topics, heavy on the issues of climate change and owing to recent events ties in elements of global finance, inequality and pretty much the future of our species.

Given it’s wide remit there are areas that I feel are stronger than others reflecting the author’s specialism but across the board it’s challenging in terms of some of the accepted wisdoms and practices of the way we humans go about things.

For me, the core interest despite my background in economics which kicks in later in the book is the first half around enviromental issues. The challenges of negating human detrimental impact on our environment and unlike it seems the current focus of by many writers and the media being around carbon emissions, it deals with the traditional concerns of environmentalists, that of actual pollution and importantly for me the degradation of soil quality across the world.

For me though it’s all very well reading about what are the problems but I’m interested in solutions and despite my trying to keep up with things and finding novel ways that we can negate our impact on the environment the one that stuck out the most for me was in India a scheme that uses wood to produce heat for cooking while also creating charcoal that can be used the enrich the land for growing crops without the use of agro-chemicals which I’d like to look into further.

So on the environmental side the book is strong and full of really interesting ideas but as it moves into the area of global finance there are some contradictions that seem to creep in. The proposition for a global currency against which all others are trading and key resources like oil can be set against instead of an individual countries currency at present like the dollar are classical Keynesian ideas which I’d have a lot of time for. However later it discusses the use of barter instead of currency where people trade their products and skills directly. Although this can and does in places work on a smaller scale it’s not a sensible means by which to run a global economy so I would have to be critical there.

That said there are some other interesting ideas like the Jak Bank in Sweden that works on the principle of not offering interest on saving. A bizarre concept at first for those used to our general model of banking in the West

David Cameron plans massive increases in taxes

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“If we had a budget surplus we could do more.” Indeed we could dear Davey boy but while the Gordon is off leading the world tackling the global financial crisis it is more telling of how economically illiterate and bereft of ideas the Tories are right now.

So here’s the rundown on how to produce a budget surplus of which I fully expect David Cameron to announce as Tory party policy at such time in the near future when he needs to get his mug on the telly.

Lessons on Swedish tax for starters. Swedish income tax is collected in two parts. Locally and nationally of which the local rate is between 30-33% yes, high isn’t it and if we add on the state income tax of between 20-25% then they could be paying anything from 50-58% income taxes. Of course if you’re of a religious nature you could always pay that tax too so add on another 1-2% an lets not forget burial taxes.

Of course Cameron could be trying to big it up on the Swedish Liberal Government’s recent announcement to cut corporation tax from 28% (same as the UK rate) to 26.3% but he might just be forgettng all the local taxes and signifcantly higher employer contributions to employees pensions.

That said, it’s easy to argue till the end of time about how much different allowances and rates are worth so we’re left with the best comparison method available to us. The good old tax take as a percentage of GDP which rather helpfully five days ago the OECD produced their latest comparison tables.

I’ll give you a hint, the press release on their website is called: “Denmark, Sweden still the highest tax OECD countries” and you can read it here.

So yes Dave, you can build up a budget surplus if you’re taking 49.1% of your entire country’s GDP in tax revenue which is probably a bit more tricky when you’re taking just 37.1% like we are here in the UK. (figures are for the last confirmable period from 2006 although the projections for 2007 don’t change much either).

Of course if you do have that much money to spend from taxation then it’s amazing what you can get for it. One of the best health and education systems in the world, some of the lowest inequality rates, basic state pensions worth nearly twice the amount British pensioners live on and of course one of the highest standards of living and life expectancy in the world but God forbid any of that hideous old fashioned tax and spend nonsense heh?

Osbourne and carrots

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Hey, promised we’d get back to a bit of politics didn’t I?

Our subject for today is Georgie ‘I is a greenie and I’m going to bung you some wonga in the process’ Osbourne.

OK, first lesson in recycling for George. In almost all cases there is no financial incentive in recycling. Sorry but there isn’t. One would hope that the bloke who wants to take over the country’s finances would be able to get his head around this.

Whether you like it or not, our economic structure is based on capitalism (yes, you don’t hear that word very often these days). Its driving principle is the creation of profit and that’s, well about it. There is no profit in recycling because when everything is reduced down to the hideously crude and simplistic concept of price, then barring a few odds and sods like some metals it’s simply easier (cheaper) to get new materials than it is to recycle old.

All ‘incentives’ to recycle are in fact sticks somewhere along the line. It doesn’t matter if you dress it up as we’re going to bung you some dosh to recycle because the premise on which that scheme is based is to creation of a false economy through regulation and or taxation.

In this case we’re dealing with landfill taxes on local authorities which is a pan-European scheme set up by the EU to encourage/force (choose whichever you fancy) member states to up their recycling rates because it’s been decided at a political level that reducing the amount of waste we as human beings produce is probably a good idea.

There’s nothing wrong with the introduction of targeted taxation to attempt to change societal behaviour as long as you can justify it with sound reasoning and preferably a lot of evidece to support your position too.

In the case of landfill, it’s fair to say you’d be hard pressed to find many people who think that reducing the amount of rubbish we chuck on tips is a bad idea although when you mention they might actually have to do something about it themselves or cough up a few bob then for some reason perspectives suddenly start to change a bit.

So we’re here, Osbourne’s little carrot is actually nothing more than the product of a very large EU stick that has created certain market conditions in the first place.

That of course leads us nicely on to the whole civil liberties malarky that seems to be doing the rounds of late.

The US company in question that Osbourne has so fallen in love with is RecycleBank and there’s two very interesting elements to their operation. The first being their use of ‘chipped’ bins. Yes folks we’re back to putting little bits a silicon chips in the bins to monitor how much waste we throw out.

Now for those with short memories, last year the Government was falling in love with the whole hi-tech approach of chipping everyone’s bins and forgive me for being a cynical old sod but wasn’t it all the Tories coming out of the woodwork saying it would be a crap idea (actually I agree with them on this one) and that flytipping would go though the roof.

There were a few pilots done, the first that springs to mind was South Norfolk District Council where it was such a disaster in both the technology breaking down and surprise surprise flytipping going through the roof that when the *ahem Tories took over the council they scrapped it.

Georgie boy might also want to have a word with Eric Pickles their very own local government spokesman because he said ‘they are also an invasion of people’s privacy’ on the issue of chipping people’s bins. Go on, what are the odds on another principled resignation of seat to stand in by-election moment? Nah, didn’t think so either.

To be fair to RecycleBank they seem really good folk and there’s nothing to suggest that they would use any information gleamed from such a system in a bad way. That said, they operate in the States where they have like proper bits of legislation and stuff written down on paper ensuring their citizens rights, not the data-mining free for all we have in the UK, seriously folks, the possibilities are endless.

How’s this for a wicked idea to catch out naughty people burning stuff in the back garden or flytipping. We could hand the service over to Tesco. They could monitor what we buy and if it doesn’t end up in our bin then we could get automatic fines as well, how’s that? Seriously folks, I’m here all week.

What Ozzy boy doesn’t exactly go out of his way to mention is the nature of payments, if indeed we’re taking RecycleBank as our model.

We’re not talking cold hard cash, you know, that stuff that’s readily accepted everywhere, even in the local boozer. No we’re talking tokens, and not the 30p off a box of Daz type (do they still sell Daz? Haven’t seen it for ages).

We’re talking (at least as far as can be ascertained from the information on their website) spend £50 in selected partner store and get £10 off tokens. OK, don’t quote those figures but we all know where we stand, to get the sweetener we’ve got to shell out a larger amount which is all well and good if you’ve got a reasonable income in the first place but if you’re getting by down to the last penny then are you going to have or even want to spend the extra to redeem the token?

What this approach also fails to address is the exact criticism the Tories were laying at the concept of pay as you bin last year. When you introduce a system whereby there is either a financial cost or benefit to putting less in your bin, doesn’t matter which. You will encourage fly-tipping and backyard burning because the financial incentive is there.

Of course what is continually being missed is not the actual desire or lack of from households to recycle, many aspects of the problems we face in the UK arise from the inability to recycle due to either poor facilities or, at least in my opinion poor packaging.

I’ve lived abroad, over a decade ago, seen how they did it back then. I’ve travelled about a bit, observed different recycling practices because it’s an area of personal interest but all came down to one very important factor. The recyclability of the packaging in the first place.

It doesn’t matter whether you try to penalise or incentivise recycling, if consumers can’t recycled the 2 litre bottle of coke they bought from Sainsbury’s then they can’t recycle it. They could if they lived in Finland or Germany but they can’t here. It’s the same product (admittedly produced locally under license) but in the UK it goes in the bin because it’s made of cheaper thinner plastic compared to thicker reusable (after being washed out) plastic abroad. There’s no scheme available to recycle them here, in other countries you just take them back to the supermarket, plonk them in a machine, it prints out a ticket that can be used at the checkout and hey presto, there’s your incentive system, it’s really not that hard and the whole lot doesn’t even have to be done by the public sector, you simply mandate the supermarkets to do it instead. They do after all have extensive distribution networks and it makes sense that after making deliveries they can do a pick up as well rather than driving back empty.

A bit of joined up thinking wouldn’t go amiss here.

I’ll finish on a positive point. It used to be (the last time I looked) impossible to recycle Tetrapak in the UK which is barmy. I was going to write a bit about it in this post but after some research it does appear to be picking up and your humble Penguin is planning a trip to Sandwell in the near future now he knows that he can recycle the milk cartons. Wednesbury to be precise as they apparently have a facility at the Leisure Centre. It’s just a bit sad that the most accessible facility for me is in an entirely different borough, but hey, that’s what you get from living in an area covered by Walsall Council I guess.

My final good deed for this post is a littl link to Tetrapaks recycling locator. I think I should move to Sandwell.

David Cameron – the substance

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Or lack of it to be more precise. I’m not quite sure what to make of the speech from the bit that I actually listened to. It was a heady mix of “the country’s gone to pot” with a bit of “here’s a few ideas we knocked up on the back of a fag packet that should be popular” thrown in for good measure. However what really struck me was not so much the lack of depth which I’ve become accustom to from Mr Cameron but moreover his distinct not mentioning a few little things that might be of interest to anyone living in a country with him as Prime Minister.

I was very interested in the line he was taking about a new world of change and freedom. The Facebook example was a classic. Perhaps I’m one of the old dinosaurs of politics that he’s trying to portray Labour as but Dave’s not exactly the best person to be talking about IT related matters but excuse me for being cynical. Facebook isn’t some part of a wider social revolution. Like all social networking it is merely an extension of interaction that takes place in the real world or at best a distraction. Mrs Penguin’s on Facebook, I’m not by the way. As far a I can tell, she uses it to find little games to play. A mate of mine once told me that Facebook’s only useful because it allows him to play Scrabble with his mates. Well yes, a nice little distraction and time waster, hardly the embodiment of a brave new world or is going to change the the future direction or our planet is it? Of course if you really want to know what Davey boy thinks about freedom and the Internet then just have a little read.

The next little bit that pricked up my ears was the comparison to our neighbours on the continent. The French, Spanish and Germans reducing their corporation tax. Now I’ll be honest in saying I don’t follow French or Spanish politics very closely but I do take a keen interest in what’s going on in Germany for obvious reasons.

Dave’s being a bit economical with the truth on this one. Yes, good old Angie’s knocked 9% off German business’s corporation tax, admittedly from a higher starting point but what Mr Cameron didn’t seem so keen to mention was what Mrs Merkel has also been up to. After all, knock tax of here, it’s going to have to go on somewhere else because the bills still have to be paid.

How about the increases in fuel duty? Yep, much as the Tories and their cohorts in various bits of the right-wing media and pressure groups will love having a pop at the Government over the increase on petrol duty here, they don’t seem too keen on leveling the same criticism at Mrs Merkel’s Government. Here it will be hard pressed families struggling to run the family motor because nasty old Gordon wants to take their money and hopefully we can pick up a few votes from disgruntled motorists but I can’t see the same being leveled at Angie.

Then there’s the 2% hike in VAT good old Angie introduced to plug the gaps in her budget deficit. VAT, as we all know is a wonderfully progressive tax that doesn’t hit the poorest in society hardest.

What this comes down to is a simple case of taking with one hand and giving with the other. I’ll do a bit more on stamp duty later in this post but it’s very simple and assuming that Gordon might nip off to see the Queen next week for a cuppa and a chat you can bet that like the last election, one of the core planks of any Labour campaign will be big banners with the deficit in the Tories spending plans.

They’re promising a lot but it’s uncosted so they’ve got a couple of options. Their current proposals financially benefit the better off so either a bigger burden of taxation will fall on the poorer in our society or they’re either going to have to borrow at unsustainable levels or cut back on services. Unsustainable borrowing’s probably out of the question even if it was a particular favourite of the Tories when they were last in power so it’s going to be cuts in services then. Which services is the question, but if anyone wants to have a guess at what goes first then we need to look no further than Tory run Walsall council to get a few pointers on where the Tories will hit first and yes, you’ve guessed it, the services that directly benefit the worst off in our society.

It’s a scary prospect but for anyone under any illusions that cuddly Dave’s turned the nasty party in a caring bunch of softies you only have to realise that all their announcements amount to robbing Peter to pay Paul, and Paul is considerably richer than Peter.

Lastly there’s this whole thing over stamp duty for first time buyers. Now I’ve been meaning to write something on this but let’s get it clear, first time buyers will be exempt from stamp duty on properties up to

Why is Germany cheaper than the UK?

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OK, lets qualify that title first. Germany isn’t cheaper for everything, definitely not healthcare, of which there’s a lengthy post/essay on that to come whenever I can get round to finishing it. We’re talking about general stuff to buy in the shops. I’m not much of a consumer, shopping is one of my least favourite activities but when I do partake of the consumer activity I’m fairly ruthless when it comes to getting a good deal.

There are a few things I’m interested in at present. Mainly techie stuff, computer components and DIY stuff, building materials and the like so with this in mind I’ve been comparing prices.
Before I left I was looking up the price of RAM for PC’s. I might one day have the finances to build a new computer and I’d like to have at least a Gigabyte of RAM. There were some strips of 1Gb RAM in Maplins circa

The NHS is awful, we have the worst health service in the world don’t you know…

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It’s been a strange week in comparison to normal. My enforced housebound status due to having my toenail removed on Monday has meant I haven’t got out. This has meant I’ve completed lots of jobs (mainly techie) that I’ve been meaning to do for a while and I’ve completely exhausted every one of my RSS feeds in terms of my media consumption.

Every blog I read has been read, every media feed I have has been read, I’ve polished off Zelda the Twilight Princess and gone back through it to find all the hidden stuff, built my Lego Star Destroyer and have found myself at a loose end.

This led me to hunt out some new stuff to consume. I rarely get round to reading the online sections of newspapers, save for the dear old Express and Swastiki for pure frustration at how bad journalism can get but I found myself at the Guardian’s comment is free section. More precisely at this article by Polly Toynbee.

Haven’t read anything by her for years, which may sound odd being a leftie politico type but it’s true. However it made me remember that I’d been planning to write a piece about the impact of consumer society values on expectations of public services. I wasn’t planning on concentrating on the health service in particular but it is a very good example.

I’m not going to reiterate what Polly Toynbee has written, just read her article to get the jist but what struck me most was the comments to her article. I managed to get about half way through before I gave up in despair at the number of people slagging off the NHS, moaning about how much taxes they pay for it or doing down what we have in the UK and comparing it to other countries that have ‘better’ health services.

So I thought I’d share a bit of my own personal experience of the NHS.

I don’t use the health service much, I’ve only ever had one procedure done and short of a few trips to the GP for a bit of professional opinion and the odd bottle of jollop that’s about it. The only procedure I’ve had is the one that took place on Monday to remove my ingrowing big toenail. I visited my GP about five weeks ago because it was painful, he diagnosed it, referred me for the operation that should have been in about four to six weeks so five weeks is pretty much on the money and I had it done. I went back today as the operations are carried out at my local clinic in the town, a walk of about 200 yards to have my dressing changed and that was it. I don’t know how much this procedure cost the NHS nor the cumulative cost of my few visits to the GP over the years but I’d hazard a guess hardly anything compared to the proportion of the taxes that I’ve paid into the system to pay for its running.

The strange thing about this, at least if you are to believe some of the comments on Toynbee’s article is that I’m quite happy about this situation. I am quite happy to pay taxes to run a service that I do not wish to use. I’m happy because I’m not able to predict and control everything in my life. I do not know that one day one the arseholes who speed past my house isn’t going to knock me over and I end up in A&E with the requirement for a lot of treatment. I don’t know if I may suffer from an illness like cancer or suddenly have a heart attack but I do know that I quite like the idea that if I do, then I don’t have to worry too much about it because I won’t have to suddenly fork over thousands of pounds to cover the cost or find out suddenly there’s a clause in my health insurance that “doesn’t cover that condition or illness”. Such as I don’t mind that from my own perspective up till now I’ve paid thousands into the system for other people’s care and treatment, because come the day I may need treatment for something serious, those very same people may be the ones paying in to cover for my treatment. Personally however, I’d be quite happy to pay into the system for the whole of my working life and never have to have had another procedure done other than the one I’ve just had.

There were also numerous comments about waiting times for procedures and of course of a negative nature so I thought I’d add a few examples. I waiting five weeks to have a minor bit of surgery done relating to a condition that caused me minor discomfort but nothing agonising. I’m reminded back to about 16 years ago when a relative of mine had the same condition. He waited over six months for his operation and apparently that was a reasonable time to expect to wait in those days to have an ingrowing toenail removed. I think I quite like the way things are now because despite my condition being a minor discomfort for the period of five weeks, I don’t think I would have fancied it for six months, not even taking into account how the condition can get progressively more painful the longer it is left.

Second example. My mother had a problem with her ear a few months back. She went to the GP who referred her to a specialist at New Cross hospital in Wolverhampton which took about a fortnight. He saw her and asked her if she’d like to come back the following day to have the procedure done. Not sure about how other people might see that, but having the procedure done the next day seems rather a good service by my standards.

I’ll touch on a bit of comparative health provision which always comes up in these arguments usually about why our health service isn’t ‘as good’ as for example the French, German or Nordic ones. I won’t go into the old debate of comparing it to the US system of individual health insurance as it’s been done to death apart from noting that purely from an administrative cost analysis our system wins hands down in terms of efficiency. It’s simple, one form to fill in, if you’re registered as living at an address in the UK you can get an NHS number and that’s about it. You don’t have to pay for treatment at the point of need and whether you’re taken sick in Wolverhampton, Edinburgh or Machynlleth you can get treatment at the nearest hospital without any hassle. I use that example deliberately as you will see in a minute.

Now I will admit to not knowing much about the French health service apart from it’s based on a combined system of people paying for it through taxation and private health insurance. Germany is pretty much the same which I do know a bit more about for obvious reasons. Is it better? Well yes if your measurement of comparison is in terms of the potential wait you may have for things to get done. Perhaps this is part of the national psyche of the Germans? They don’t tend to like to wait for things, something very evident in Mrs Penguin and with their combined state funded and private health insurance system they get a faster service than we do. Of course they pay for it, not only through higher taxes but also having to afford private health policies on top and we are back to the old adage of getting what you pay for. Whatever rubbish is spouted by the right of British politics we have it fairly good in the UK in terms of taxation, both personal and business. What we have is a health service that is effectively done on the cheap because of the conditions under which it is expected to run. Despite its detractors it’s a pretty damn efficient organisation, of course more could be done but given how we pay comparably less for our health service than our near neighbours on the continent we get a pretty good deal.

Moving on to the Nordic model of which I know more about, in particular of the Finnish system having lived there. Theirs is in essence more comparable to ours in that it’s a directly funded for by the tax-payer system unless things have radically changed since I last lived there.

However here’s why I used the example of our own where it doesn’t matter if you’re in Wolverhampton, Edinburgh or Machynlleth when you need treatment. Much as the Finnish health system could be considered better than our own, less waiting times, better facilities etc etc, it’s not a ‘national’ health service. It’s funding comes through local taxation which on one hand is good in terms of being able to tailor treatments to more specific local areas but if for example you live and pay taxes in Tampere and just happen to be visiting Helsinki when your appendix starts to burst and there have been some examples of this. The doctors in Helsinki have been known to ship the patient 120 miles north back to Tampere so that they pick up the cost.

Personally if I happen to be in Sheffield and my appendix starts to burst I’d quite like to be taken to the local hospital and it done as quickly as possible there than be shipped back to Wolverhampton and that of course raises the issue of what is the overriding priority? As much as the Nordic system is very good, it doesn’t preclude the possibility of costs and funding overruling clinical patient care. I’ll just add that there’s actually another type of health service structure in Finland that I haven’t mentioned, that for students which is completely different and funded through membership of the local student union which is compulsory and has to be paid for. I won’t go into too much detail but over there students unions are very much a part of the social welfare structure as opposed to the organisers of piss-ups at universities over here. (that is a deliberately flippant remark for humorous value, yes I know they do some very important student welfare stuff here too before someone complains but in comparison it is nothing to the extent that they do in Finland)

What’s the conclusion? Well much as we would all want our treatment done the next day, it’s quite clear that in Britain people are not willing to fork over the extra money in taxation to pay for it. We have a pretty good and efficient health service that operates on significantly less money than those in France, Germany and the Nordic countries so we can’t really complain that much. We are spending more on the NHS now than we were under the Tories and the improvements in service and significantly lower waiting times are there to see but for some reason people seem not to understand this expecting everything to be done yesterday and of course not willing to cough up the extra cash to achieve this aim. Something for nothing I think that is called and it’s a very childish perspective to take which perhaps is a sad reflection on the society in which we live.

[note] I’d originally titled this article “In pursuit of happiness” and intended to go on to other areas but I’ve decided to keep it more focused on health issues. I’ll do the more general theme another time.

Comparative economics, carbon off-setting and Kyoto targets

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Yes, I’m getting back to a little bit more on the serious issues again but please don’t be put off by the title.

A while back I intended to write a long article that never happened and this issue was going to play a part in it.

The primary inspiration for it was an article on the BBC’s website which I really can’t be bothered to hunt out now which reported that only Britain and Sweden in the EU were on target to meet the conditions of the Kyoto agreement as regards carbon-emissions.

Good news of course to us conscientious environmentally aware and active Brits that we’re leading the world on this issue. I remember too well the news back in the 80′s when Britain was branded the ‘dirty man’ of Europe with our factories belching out sulphur dioxide that was destroying the forests of Norway, Sweden and Finland. We’ve obviously come a very long way since then. Or have we?

Now we’ve had a bit of news the last few days that actually the UK’s carbon emissions rose last year but I’m not going to jump onto that issue to take an all too easy swipe at the Government. I’m more interested in longer term trends and patterns which, at least as far as your humble Penguin can surmise, have gone completely unnoticed.

Here’s where we get into a bit of economics. I want to introduce the concept of comparative competitive advantage. It’s a well established economic theory which basically means one country can produce some goods better or more efficiently than the other so if countries trade the goods they are both best at, the whole system is more efficient, productive etc etc etc.

The classical example of this is to consider two countries. Country A is somewhere say in the Caribbean, nice hot climate but not much in the way of industrial raw materials. Country B is somewhere in northern Europe, much colder climate but relatively rich in terms of mineral and energy resources. Country A can produce Bananas a lot better than country B because it’s got the right climate. However country A requires various agricultural equipment and tools that country B is better placed to manufacture. So they happily produce what they’re best at, trade the goods, everything is more efficiently done and everyone’s happy.

With that in mind I’d like to return to this Britain seeming to be doing quite well on the old Kyoto targets compared to everyone else except Sweden.

I know we’re doing a lot in the UK on this, we should be doing more but we are in terms of our environmental regulation on industry a lot better than most. However this did puzzle me as to why some of the other EU countries weren’t up there particularly those who have been seen to be more ‘green’ than us in the past.

This is where I would like to introduce a ‘new’ concept. Now I have been looking around quite a bit for relevant information and personally I can find no one anywhere who has touched on this issue and it is very important if we are serious about building a long-term sustainable world for the future of our species. As I can’t find anyone who has contemplated this issue then I’m going to claim it as my own although I’d be happy to defer to anyone who can find mention of it else where.

I’m going to call it ‘comparative false carbon off-setting’. Bit of a mouthful I know but bear with me.

This is the theory that by off-setting swathes of economic activity, individual countries can appear at least on the outset as being ‘greener’ than others. So here goes, a brief overview of the UK as an example.

Back in the 70′s, Britain had quite a large industrial base producing goods that were consumed by the British people in Britain. Along comes the Tories and a few million people on the dole later Britain now has a far smaller industrial base which has continued to shrink ever since.

Now have the British become ever more less the consumer. No, and from my own personal experience in comparing to other countries I think it is fair to say that the Brits are some of the most voracious consumers out there. We love all the latest things, clothes, consumer electricals, cars etc etc. So although our ability to produce the goods at home as it were has declined, our desire to purchase has not, and if anything it has increased considerably over the last 30 years.

This means we have to import the goods from elsewhere. We afford to do this by shifting our economic activity to the service sector and here’s where the problem is. However you want to look at it, our economy is built on a service sector that comparably produces less pollution/carbon-emissions than industrial production. Good for us in terms of needing less specific energy for manufacturing, processing raw materials and so yes, when taken from that perspective the UK is doing quite nicely in terms of cutting carbon emissions.

The problem arises from us still wanting the manufactured goods which as they are no longer produced at home come from other countries. Countries that do not have as good environmental standards as ourselves. I’m going to single out China as an example of a country that over the past few years has become a major exporter of goods to the UK. Nothing personal against the Chinese but they have come in for some stick on their environmental record, the rapid growth of manufacturing and their willingness to use high carbon emitting energy sources such as coal to fuel their economy.

Here’s where I find that us Brits put ourselves in a position of being a bit on the hypocritical side because we are happy to blame countries such as China for not doing enough to curb their carbon emissions but that very rise in emissions is of a direct response to the demand for goods by our good selves that the Chinese produce.

We have, through poor economic policy started in the 1980′s left ourselves with the inability to feed those demands at home and thus require not only that the material goods we consumer be manufactured in a way that produces more carbon emissions than it would in our more highly regulated economy, but equally then have to be shipped from the other side of the world incurring yet more carbon emissions.

While countries like France and Germany who aren’t on target to meet their Kyoto targets but still retain large manufacturing bases to supply local demand of their consumers. We have in effect off-set the pollution/carbon-emissions of the manufacturing process required to meet many of our own consumer demands which creates a false image of the relative ‘greeness’ of the economies of different countries.

If we were to try and address this issue by compiling carbon footprints based not just on the economic activity within one economy but by analysing the carbon emissions generated by what is actually consumed then I fear that the UK may not come out in quite so rosy a light as it has done.

Anyway, there’s a thought to consider.