Adam Smith Institute

As a purely personal opinion reform of the Common Agricultural Policy should be achieved by burning the entire structure to the ground and ploughing the intellectual landscape that produced it with salt: the selling of the administering population into bondage would perhaps be a step too far in this age.

In the absence of a Cato to lead the mob with burning brands and pitchforks aloft I am left to consider less radical alternatives. Like this one from the European Centre for International Politial Economy. They open with two quite mindboggling points: 

Alasdair Darling, the British Finance Minister, recently proposed to abolish tariffs and all other measures that keep EU agricultural prices above world market levels, as well as to end the direct payments that farmers receive irrespective of their output.

Good grief, almost makes me warm to the man, such an entirely sensible proposition. This is less sensible: 

Michel Barnier, his French counterpart, even deems the CAP so effective that the policy should be exported to developing countries.

Just what the developing world needs, high food prices, a tax burden supportable only by the already rich and limits on what farmers may produce and how.

The basic outline of their proposal is that: 

First, that all measures that distort market prices and production should be abolished. This includes production quotas, land set-asides, storage aids, export refunds, output payments, and area payments. Second, the Single Farm Payment (SFP), which provides income support to farmers independently of their current production decisions, should be phased out because it does not serve any societal need. Third, targeted subsidies that reward farmers for providing socially valued services that are not remunerated on the market, such as maintaining scenic landscapes, should be adapted. Many of these subsidies should be provided at the national or local level without or with little EU co-financing.

In a nutshell, that the Common Agricultural Policy should, as a policy, have almost nothing to do with agriculture and should not be common. Yes, I'd happily sign up to that, even in the absence of an oratorial firebrand whipping the mob along with cries of CAP delenda est for the end result would indeed be that delenda* to all our benefit.

* Yes, yes, I know, pig Latin of the most appalling kind

Banks going down like ninepins, fortunes being wiped off the stock market, inflation haywire, loans unobtainable – the market's messed up, hasn't it? The newspapers tell us that even the most ardent defenders of the free market are calling for government action.
 
Well I'm not. It's perfectly obvious to me that it's governments and regulations that have messed up, not free markets – because in the financial wonderland that our regulators have created, free markets do not exist.
 
Much of the problem comes down to US government 'anti-redlining' legislation, which forced institutions to lend to people in parts of town where the local property market was bad collateral. Lenders knew they'd have to comply or face regulator's retribution. True, the rules meant that a lot of people were able to own their own home for the first time. Unfortunately they also meant a lot of 'sub-prime' debts on the institutions' books.
 
That was no problem when everything was booming. But the  'prudence' of Gordon Brown, and Alan Greenspan's confident mastery of the markets now turn out to have been prolonged, stealthy, credit binges. It was great for politicians and business, at the time. The trouble is that after every binge, there's a hangover. In the cold light of day, nothing quite looks so clever.
 
Like Northern Rock. The Bank of England thought it was taking too many risks months before it collapsed – but the Financial Services Authority did nothing. When it failed, three regulators – the Treasury as well – were all stepping on each other's feet.
 
This week's turmoil owes its origin not to the free market, but to politicians engineering booms in which everything seemed to succeed, and in reassuring investors that their money was completely safe. Financial markets are better regulated by their customers looking carefully before parting with their cash, not by distant regulators.

Trigger Happy is the title of HRZones’s web page devoted to employment legislation this month. Looking through the details of recent changes, it is less trigger-happy and more trigger-ecstatic. To think that businesses need to keep up with all these intricacies is bewildering. To put oneself in the position of a small business with a small staff is frightening. Surely enough to put off many of the best and brightest from taking a risk, utilising their entrepreneurial talent, benefiting themselves, their employees and the economy.

As an article in Director Magazine concluded: "For many smaller businesses, the red tape caused by employment legislation is a good reason to avoid hiring staff and using agency workers or freelance consultants is a tempting alternative."

To quote Claire Moran, the owner of the small business, Forge Public Relations:

From rules and regulations surrounding employment conditions, through the risk of being sued for constructive dismissal, to the difficulty of getting rid of unsuitable employees. All this makes the life of small business owners very difficult. They have to spend a huge amount of time on all of it, which distracts them from running the business.

With the UK economy looking decidedly shaky, it is time for employment legislation to be reviewed and scaled back. The confidence that this will give employers will override any government schemes designed to encourage entrepreneurs and small businesses. In this respect – as with other contacts between the state and private businesses – governments need recognise that their meddling causes more problems than it solves. Perhaps in future, upon being elected they should be made to take the Hippocratic oath, promising to "do no harm".