The almighty dollar
On July 6th, 1785, the US Congress unanimously decided that the name of the US currency would be the "dollar" and adopted a decimal subdivision of it.
Count Hieronymus Schlick of Bohemia had minted high quality silver coins known as Joachimstalers, named for Joachimstal, the valley where the silver was mined. The German word for valley is thal, pronounced tal. Joachimstaler was later shortened to the German ‘taler,’ which became ‘dollar.’ The coins circulated widely in the American colonies, and were respected for their quality and reliability.
The Coinage Act of 1792, specified a "dollar" to be 371 grains and 4 sixteenths part of a grain of pure silver. Alexander Hamilton decided to base it on the average weight of worn Spanish ‘dollars’ (pieces of eight), and weighed a sample of them to come up with the 371 figure.
The familiar greenback dollar bill was tied to precious metals until 1971, when President Nixon suspended the convertibility of paper money into bullion, making the dollar a fiat currency like most others. This means it has value because the US government says it does, and because people have confidence in it. Given the world dominance of the US economy, and the widespread use of the dollar for international transactions, the US dollar is the world’s leading reserve currency.
One of the key motives behind the creation of the Euro was the resentment in parts of Europe, especially France, at what they perceived to be the ‘unfair’ advantage the dollar’s position gave to America. They wanted the new currency of the EU to be able to stand up to the dollar, and maybe even replace it as the world’s primary reserve currency.
In fact some countries outside the US, especially in the Caribbean, use its dollar as their official currency, and in many others it is accepted de facto as an alternative, usually a preferred one. People’s acceptance of it is ultimately based on their trust in the US government and its Federal Reserve Bank. Even a currency tied to gold and silver, as the US dollar used to be, is promissory, in that people trusted that the government would exchange the notes for bullion if requested.
British banknotes say “I promise to pay the bearer on demand the sum of X pounds,” but if you take one into a bank, even the Bank of England, they will only give you another banknote of equal value in exchange.
A problem for those who want currencies tied to gold is that there is not very much of it. All of the gold ever mined in history would only fill up about one third of the Washington Monument. And the gold supply cannot be increased at a steady rate to match the increase in productivity and growth, generally reckoned to be between 1 and 2 percent per year, and at the upper end of that range. The Bank of England’s Governor is required to send an open letter to the Chancellor when inflation goes above 2 percent. Had bullion-backed currencies been the norm at the time of the 2008 Financial Crisis, it would not have been possible to do Quantitative Easing, and a worldwide repeat of the Great Depression might have resulted.
It would be nice if there were a clear solution to the problems that confront fiat currencies, but there does not appear to be an obvious one. It seems that governments must respond to crises on an ad hoc basis, learning from what has or has not worked before, and treading very carefully. For the moment it is the dollar that ultimately underpins the global economy, and we have to hope that those who control it will do so responsibly.
We can't help but think this is an error about climate change
Ed Miliband, in common with a number of other people in and around politics, is hitching climate change to social justice. We can’t help but think that this is a significant error. It’s going to mean we do ever less about climate change itself.
Leave aside, for our purposes here, whatever anyone actually thinks or believes about climate change itself. Just for the sake of argument let us start from the idea that the IPCC is right and then examine the logic from thereon.
A new approach must connect the climate crisis with inequality to offer a compelling and attractive way forward for society
But there are plenty of people who don’t think there is an inequality problem, and others who wouldn’t want to take action about it even if there were. Some of whom still remain open to the idea that climate change could be a real problem that we should do something about. The linkage would seem to reduce support for climate change action therefore.
Tackling the climate and ecological crisis requires urgently reimagining how we live and work. A Green New Deal – conceived of in the UK, popularised by US congresswoman Alexandria Ocasio-Cortez and now powered by social movements here – should not just decarbonise today’s economy but build the sustainable and just economy of tomorrow.
But the number who share that definition of “just economy” is rather small.
The way we do this is by connecting the two great long-term crises that confront us today: the climate emergency and inequality. This is how we construct a broad and durable coalition that can sustain this unprecedented transformation. As well as truth-telling about the disaster that will confront us if we do not act, with the costs falling on those least responsible, ours must be a story of how we build a more equal, prosperous, democratic society.
The number who share that vision of what society should be like is, we suspect, rather smaller than current Labour Party voting intention and most unlikely to be greater than it. Meaning that no more than 18% of the adult population share it.
The number who think that perhaps something should be done about climate change is rather higher than this. Which is why we think this is a mistake. Hitching doing something about Flipper boiling in those vapours of the last ice floe to some demand about radical equality seems to reduce, not increase, support for the plan of action.
But then as the short Frenchman said, never disturb your enemies while they’re making a mistake.
The cloning of Dolly the sheep
It was on July 5th, 1996, that Dolly came into this world. Dolly was unusual, in that she did not have a mixture of her father’s and mother’s genes, but instead had only an exact copy of her mother’s. Dolly was not an example of virgin birth, but of cloning, and she was a sheep, probably the most famous one in the world.
She was produced by a partnership of the Roslin Institute of the University of Edinburgh and the biotechnology company PPL Therapeutics. She was the product of somatic cell nuclear transfer, in which a cell nucleus, in this case from a mammary gland, was inserted into a developing egg cell whose own nucleus had been removed. Electric shock stimulated it to divide, and the resulting blastocyst was gestated in a surrogate mother.
Her name was a tribute to Dolly Parton, because her creators couldn’t think of any more impressive mammary glands. Dolly the sheep died aged six-and-a-half, instead of the more normal 11 or 12 years, but it was of a progressive lung disease (Jaagsiekte), common among sheep, caused by a retrovirus and unrelated to her cloned origins. Indeed, in 2016, four identical clones of Dolly were still alive and well aged 9 years, and Dolly herself produced 6 healthy lambs. The scientists found no defects in other cloned sheep.
Since Dolly, many other animals have been cloned, including pigs, deer, horses and bulls. Chines biotechnicians report a 70-80% success rate for cloned pigs, and the Korean company Sooam Biotech produces 500 cloned embryos a day. The first cloned primates were produced in China from a macaque money in 2017, and in 2019, five identical gene-edited cloned monkeys were produced to aid the study of diseases.
Intriguingly, an extinct Pyrenean Ibex was cloned in Spain in 2009, but unfortunately died shortly after birth from lung defects. It did pave the way, however, for the possible revival of extinct species using similar cloning techniques. Researchers are already engaged on projects to restore the dodo, great auk and woolly mammoth, and no doubt others will follow.
There are some who rail against this type of research, arguing that men should not play gods. People argued similarly when Louise Brown, the world’s first “test tube baby” was born by IVF in 1978. Since then more than 8 million children have entered the world through this technique. Gene editing of cloned embryos will enable us to bring up animals resistant to diseases and deformities, though there will be painstaking refinement of techniques along the way to achieving this.
There can be little doubt that humans will be cloned, although the advantages are less obvious, in that it is the shuffling of genes through sexual reproduction that is the engine of the variety that can be tested against the environment. Just as there are companies that can clone a beloved but departed pet, there may well be ones that offer to clone a child that died tragically young. How closely the new offspring will resemble the one lost, however, will depend on how its environmental upbringing will switch on its genetic potential.
Should this be stopped? No, it is what we do. To those who ask what good will come of it, the reply is attributed to Benjamin Franklin who watched the first human balloon flight in Paris, and later to Michael Faraday when asked about electromagnetism. “What good is it?” The reply was, “What good is a new-born baby?” We don’t know, but it has potential.
If only there were a solution to this problem
Apparently Brazilian chicken has a certain salmonella problem:
Brazil is the largest exporter of frozen chicken in the world, exporting $750m-worth of the meat to Europe last year. But about one in five of its birds are contaminated with the food poisoning bug salmonella.
Presumably someone will want to do something about this. The question being, what?
The EU has been running a major salmonella reduction programme for more than a decade for its domestic poultry flocks. In the UK high standards and close monitoring meant that salmonella rates ranged from 1.5% to 2.2% between 2013 and 2017, according to the Food Standards Agency (FSA).
Given the effort invested there it would appear that there is no method of ensuring zero salmonella in chicken. Sure, a reduction of a one in five to a one in fifty chance of said infection is pretty good but those are still odds which should lead us to be careful in handling raw carcasses, making sure they’re fully cooked before consumption and so on.
Given this impossibility of elimination of the problem perhaps it’s possible to manage it in some manner? For example, why not a rinse in a light chlorine wash? As the Americans do to their chicken and as we do to our bagged salads. There is that EU insistence that we must never do this because reasons but those reasons are never really made very clear. Except that rather cynical idea that the chicken producers of Europe really don’t want to have to compete with the American ones.
But then when discussing the politics of trade the correct thing to wonder about is “Are we being cynical enough?” rather than any worry that we might be too much so.
Happy birthday, America
On July 4th we celebrate US independence. It was on this date in 1776 that the US Declaration of Independence was adopted in what is now Independence Hall in Pennsylvania by the Second Continental Congress. The thirteen colonies now became thirteen independent sovereign states, united to become free of British rule.
The United States became a beacon to the world, an example of a nation governed by laws not men, laws that protected the rights of its citizens from arbitrary power, enabling them to stand up against government itself if they needed to. The Founding Fathers were conscious that they were building “a city on a hill,” one that the world could look up to and be inspired by its example.
The US was to become the home of those seeking refuge from persecution and oppression, and for those seeking to make a better life for themselves in a country that would allow them to do so. America became the land of opportunity, where talent and hard work could make good.
The experience of settling in and developing the new land embedded in immigrants a practical streak that has not left them today. The US became known as a “can do” country. It is noteworthy that Thomas Jefferson’s draft declared, “We hold these truths to be sacred and undeniable.” Benjamin Franklin, ever practical, scored out the last three words with thick black strokes and substituted “self-evident.”
America had its flaws, of course, as all countries did then and still do. Many of those signing that document were slave-owners, including Jefferson himself, and slaves were not awarded the rights asserted for others. It took nearly a century before that was rectified. The native Americans were likewise excluded, and were also treated badly. But America does tend to correct itself and to renew itself. “America the Beautiful,” which is effectively its second national anthem, contains lines that few other nations could write about themselves.
“America! America! God mend thine every flaw, Confirm thy soul in self-control, Thy liberty in law.”
The world owes America a debt, in that its citizens have sacrificed themselves in two World Wars to save the world from conquest and tyranny, and to assert the right of nations to be free. In the second of those wars it saved the world from appalling barbarism and unimaginable cruelty.
America has also created wealth on a scale previously undreamed of, and it has been generous with that wealth, helping other nations to lift themselves from the devastation of wars, or the impact of natural calamities. Through globalization, the US has enabled poor people on the margins in distant countries to secure themselves a better life and to look to a better future.
America has its problems, but it has solved problems in the past, and there is every prospect that it will do so into the future. So, on their founding day, let us light the barbecues and enjoy the fireworks, and say with conviction, “Happy birthday, America!”
The markets for organ transplants
As a general rule around here we think markets work. We’re also entirely cool with the idea that sometimes restrictions must be placed upon markets to make them work better. There are, for example, those varied problems with externalities, things not accounted for in market prices. We’re even happy with the idea that we should have a market in market restrictions. How else are we to find out what actually works if we don’t go try it?
We do though insist that we then learn our lessons from those market outcomes. Something that isn’t being done with organ transplants. The government here has nationalised our corpses - moved from an opt-in process for the use of cadaver organs for transplant to an opt-out. Instead of us registering that we would like to help those in need after our death it is now assumed that unless we have distinctly stated otherwise our bits and pieces may be so used.
This doesn’t actually work:
Abstract:
Studies comparing opt-out and opt-in approaches to organ donation have generally suggested higher donation and transplantation rates in countries with an opt-out strategy. We compared organ donation and transplantation rates between countries with opt-out versus opt-in systems to investigate possible differences in the contemporary era. Data were analysed for 35 countries registered with the Organisation for Economic Co-operation and Development (17 countries classified as opt-out, 18 classified as opt-in) and obtained organ donation and transplantation rates for 2016 from the Global Observatory for Donation and Transplantation. Compared to opt-in countries, opt-out countries had fewer living donors per million population (4.8 versus 15.7, respectively) with no significant difference in deceased donors (20.3 versus 15.4, respectively). Overall, no significant difference was observed in rates of kidney (35.2 versus 42.3 respectively), non-renal (28.7 versus 20.9, respectively), or total solid organ transplantation (63.6 versus 61.7, respectively).
It’s worth noting that this is being reported by Al Roth - reported, not the original paper - whose Nobel was for the design of markets and matching systems at least in part concerning organ transplants.
Which brings us to our view - probably not supported by Roth - concerning organ donation. Nice though it would be to think that they are enough it turns out that charity and empathy aren’t. This accords with the Welsh experience recently, where the move to opt-out didn’t move the dial on that rate of organ transplant. We’ve done the experiment, seen the outcome, and variations on uncompensated donation don’t solve the problem. Thus, if we want to solve the problem we need to move to a system of compensated donation.
As we’ve said many times over the years. Closely managed compensation of live donors of those organs which can be gained from live donors does in fact work in the one place it is generally allowed - Iran. Market experimentation in its true sense, using different arrangements to see what works, has shown us the answer. If we want to solve the problem this is therefore what we should be doing.
From killing to conserving
On July 3rd, 1844, the last surviving pair of Great Auks were killed on Eldey, off the coast of Iceland, making the species extinct. The bird was flightless, and clumsy on land, but an efficient swimmer, living off fish and crustaceans. There were once millions of them, but it has been an important food source for humans, from the Neanderthals 100,000 years ago, until its demise in the 19th Century. The birds were hunted for their meat, eggs, and their down feathers that were used in pillows.
The Great Auk is only one among many species whose extinction has been linked to humans and their hominid predecessors. The arrival of humans in places that had no previous human inhabitants has often, if not always, precipitated a mass extinction. The megafauna of the late Pleistocene or Holocene became extinct partly because of changes in the Earth's climate, but significantly because they were easy prey to skilled, tool-using, early human hunters. Victims include charismatic animals and birds, including the woolly mammoth, quagga, dodo, moa, glyptodon and countless others less well known.
The development of agriculture and animal husbandry caused extinctions through habitat changes, and early industrialization and population increase created a demand for easily processed animal products. Whales were hunted to near extinction for their oil, used in margarine and soap, and in the lamps that lit homes and streets. Ironically, they were saved by the development of petroleum products led by John D Rockefeller, someone not otherwise noted as a conservationist.
As humanity's wealth has increased, however, so has it diminished the need to exploit animals to extinction. Now that technology has given us alternatives, we can practise and afford conservation. Indeed, technology is enabling us to save species that would probably be gone without it. Artificial insemination and IVF is being used to breed endangered species like the giant panda. Cloning is being used to save others.
Even more exotic techniques are under development. Genetically modified crops are being developed to grow in salty and arid conditions, reducing the need to destroy rainforest habitats to plant food crops. Cultured "lab-grown" meats will greatly reduce the need for pastures, again allowing us to leave wild habitats alone, and even to rewild large areas of current farmland. Research is being done to develop lab-grown ivory, produced in quantity from a few cells. When it floods the market, it will make poaching uneconomic by lowering the price of ivory to a fraction of what it currently fetches.
And slightly further down the road is the prospect of restoring species already lost by recreating them from their DNA. The Great Auk is a likely early candidate, given the quantities of DNA we have from it. The technique will be to replace the nucleus in the egg of a similar bird with Great Auk DNA, so it will be a Great Auk chick that is hatched. A similar project is under way to restore the woolly mammoth by altering an elephant's embryo and having it gestate a mammoth. Almost certainly this can be done with other currently extinct species.
Further still down that road will be recreating lost species, not from their DNA, but by manipulating the genes not turned on in their descendants. This raises the prospect of recreating dinosaurs from their surviving avian relatives.
Humanity, having wiped out species throughout its past, now for the first time in its history has the resources and the beginnings of the expertise to make amends for some of what its predecessors did. It won't be achieved by us all becoming vegans or living more simply. It will be done by putting our wealth and our technology toward making that goal a reality.
Boris' idea has merit even if the plan needs work
We are indeed believers in us all enjoying less government than we currently suffer under. Thus this idea of Boris’ has merit, even if the detailed plan of action needs some work:
Boris Johnson is considering proposals to shrink the size of the Cabinet after key backers urged him to slim down the Government if he becomes prime minister.
Mr Johnson has already voiced a desire to merge the Department for International Development and the Foreign Office, but supporters are encouraging him to go further by reviewing the future of seven or more other departments to save billions of pounds.
The departments for Justice, Business, Culture, International Trade, Work and Pensions, Transport, and Brexit could all be abolished or merged with other departments under plans being championed by members of Mr Johnson’s team.
Shuffling who does the paperwork doesn’t change what nor the amount of what government does. Therefore refining the bureaucracy doesn’t alleviate the taxpayer burden of government. What is needed is to stop government actually doing something.
To take an absurd and not to be taken seriously example, saving the cost of the embassy in Ulan Bator requires closing the embassy in Ulan Bator. Not shuffling responsibility of it either to or from, even between, the aid and foreign departments.
Thus, close down things, not change how they are administered. We would, of course, be delighted to help in identifying those things which central government should no longer do. We’d perhaps start with the departments of education, trade, agriculture and rural affairs and we can all note that the Brexit department will soon enough be redundant.
Time to revive one of our older ideas. Through those mists of time we can’t quite recall whether the offer was a Viscountcy or an Earldom but a serious and significant hereditary title at least. For each and every Cabinet Minister who agreed that, upon taking office, their job was to close down their department. The title being granted only once they’d succeeded of course, made certain there was no possibility of a second such title ever arising. After all, why not, gongs are cheap, the benefits would be large….
How the eyes of Nostradamus saw the future
Nostradamus, who died on July 2nd, 1566, was an apothecary and a physician before he turned his attention to predicting the future. From 1550 he wrote at least one Almanac a year, containing between them nearly 6.500 prophecies. He is remembered today mostly for “The Prophecies” (1555), which is cast as a series of French quatrains (verses) that claim to predict how world events will unfold.
The reception was mixed, in that some thought him a servant of Satan, while others hailed his divine insights. Catherine de' Medici, wife of King Henry II of France, was an admirer, and bestowed royal favour upon him. Many of his prophecies are lifted from other authors, including classical texts, in an age when plagiarism was not regarded as abnormal, or even unethical. His language is so obscure, couched in ambiguous terms, that to modern eyes it reads more like the astrology columns in newspapers than it resembles serious futurology.
While popular culture thrives upon his alleged foretelling of major events subsequent to his own life, academics have revealed that most of the copies and translations of his works are spurious, altered after the fact to make them seem better and clearer than they were. At a scientific level he is not thought to have had any prophetic powers.
His prophecies mostly dealt with natural or human disasters such as earthquakes and outbreaks of plague, or of wars and conquests. He is alleged to have predicted the Great Fire of London, the French Revolution, Napoleon, Adolf Hitler, and Donald Trump, plus both world wars, and the atom bombs on Hiroshima and Nagasaki.
Usually people look at the events of their own time, and interpret Nostradamus in ways that make it seem he predicted them. Thus he is credited with foretelling the moon landing in 1969, the Space Shuttle Challenger disaster in 1986, the death of Diana, Princess of Wales in 1997, and the September 11 attacks on the World Trade Center in 2001. He didn’t.
None of his quatrains has been interpreted to predict a specific event before it occurred, except than in ambiguous terms that could equally apply to any number of other events. To gain a genuine reputation, the prophet or futurologist has to be more specific.
My own method of predicting future progress is largely based on looking to what people want to achieve, and estimating if people are prepared to commit the resources and the effort. Because, like Julian Simon, I think human creativity is the ultimate limitless resource, I think humanity will usually achieve the things it wants badly enough.
In “Britain and the World in 2050,” I list specific achievements I think likely to be accomplished, many of them much sooner than that. It is a world of cheap energy, abundant water and food, many diseases conquered, pilotless aerial taxis, and with enviable opportunities and choices. Of course, the media went to town on the mammoths, dodos and dinosaurs, as I knew they would.
Why not just make drugs legal?
This is indeed an advance and it’ll cut overdose deaths:
Addicts will be able to get their illegal class A drugs tested for purity and quality without fear of prosecution under plans for city centre labs licensed by the Home Office.
The Loop, a non-profit group that already tests drugs at festivals, plans a network of up to five centres in cities from Bristol to Manchester where users hand in a dose-size samples of drugs like heroin and cocaine.
The test results are given back after they undergo a 20-minute consultation by The Loop’s volunteer health care professionals who assess their drug and medical histories and current use and provide health or medical advice.
The major cause of overdoses being that uncertainty of what the dose is. So, yes, an advance, this will cut the number of deaths. And with the possibility of fentanyl entering the supply, as it has done in the US - the reason for it not having done so as yet being ascribed to the generally higher purity of heroin in the UK supply chain - this could become more important.
But if we’re going to do this why not just go the whole hog? Make drugs legal. Properly legal, with known producers each responsible for their own brand. And thus desirous of making sure that dosages are clean, known and what they say upon the tin. For it is true that known dosages of clean heroin cause few deaths. Someone on regular doses of pharmaceutically pure heroin functions pretty normally for decades. It’s the uncertainty of dosage as a result of the illegality that leads to the deaths.
That is, if we’ve already accepted the argument that wraps should be checked for dose and safety why not move to the system we know does this best? Manufacturers taking legal responsibility for their own products?