We can see a certain problem with ethnic pay gap protection

Over and above the problem of this being attempted management of the economy at too great a level of detail that is. We simply do not believe that government is able to deal with things at this level of fineness. But as we say, beyond that.

Inequality has risen over the last decade, with BAME families disproportionately hit by the pandemic and the cost of living crisis, as well as being on the sharp end of cuts to the NHS, education and the criminal justice system.

Anneliese Dodds, the shadow women and equalities secretary, said: “It has never been more important to deliver race equality. Inequality has soared under the Tories and too many black, Asian and ethnic minority families are working harder and harder for less and less. This is holding back their families and holding back the economy.

The problem being in the numbers used to analyse or explain differences in ethnic pay, that ethnic pay gap.

On the raw figures British born Black, Asian or Asian British, Mixed or Multiple ethnic groups and Other ethnic groups all in fact get paid more than White. When we include overseas born Black with British born then that group does earn less. This is something that has happened in this past 5 or 6 years, from 2018 onwards or so, a reversal of the earlier paid less than.

When we drill down further into these numbers and correct for geography then the picture changes. For this higher pay is partly at least an artefact of the concentration of ethnic minorities in London, where pay is significantly higher than the rest of the country - but so are living costs as well.

When we drill down further to examine by education level and so on then the picture changes once again.

The point being that the situation is complex. And, OK, so it’s complex.

However, it’s complex in the opposite direction from the gender pay gap. On those raw, national, figures women earn less than men. On those raw, national, figures ethnic minorities earn more than whites. On the fully adjusted for working hours, jobs done, education levels, geography of workplace, job for job, parental status and so on then women do not earn less than men. But some ethnic minorities do earn less than whites, others more.

Which is, we think, something of a problem for at least one or the other set of complaints. If it is the properly adjusted gap that we should all worry about then gender pay has been solved. For which Hallelujah, obviously. If it is the raw and unadjusted gap that is the problem then there is nothing to do - unless we’re to start worrying that whites are underpaid - about the ethnic pay gap.

To change the method of measurement midstream as it were, to say that unadjusted is important when talking of gender and adjusted when talking of ethnicity is to, we would suggest, be overly picking and choosing which numbers to pay attention to. Almost as if there’s a manipulation of the figures in order to create a political issue that requires action.

Some still think The Good Life is, well, good

Or even, some still seem to think that the - attempted at least - peasant self-sufficiency portrayed in The Good Life is well good.

‘Our chickens cost us £5 per egg’: what to expect from keeping hens

Could keeping a flock be a plucky financial decision or will it peck away at your bank balance?

In more detail:

Joanne Swali, who looks after three hens with her family, says: “My husband has joked quite a lot of times that it would have been cheaper if I asked for some diamond earrings.

“I would say that, a few years in, if you factored in all our expenditure to date, our cost per box of six eggs would probably be in the region of £30.

Even at current supermarket prices that is not a saving.

Howorth also stresses that hen owners could save money by ditching a gym membership in favour of getting outside and exercising their muscles tending a flock.

It also seems to require a gym-level amount of physical labour. And we’ll guarantee that the cost of the time spent doing that isn’t in that £30 per small box of eggs calculation either.

There is a reason why we all abandoned peasant farming, it’s that farming is one of those things where there are vast economies of scale. Thus, returning to peasant farming would be a return to the abject poverty of the past where we were all peasant farmers.

Of course, if you like doing this sort of stuff, if this is what makes your life good, then by all means carry on. But we do need to vituperatively reject those who try to insist that we should all be doing this. Or even, those like Oxfam who have, in the past, insisted that Africa should be forced to remain like this.

Peasant farming, as a lifestyle choice, is fine if you like that sort of thing. As a general or national thing it’s a poverty creating disaster.

Exxon Knew!

We’re seeing, around and about, an insistence that Exxon knew all about CO2 levels and so on back in the 1970s, even the 1960s. We’ll leave it to others to discuss more fully the implications of that, we just want to make the one apposite comment.

So the allegation, claim, insistence, is that privately funded, within a corporation, science was more accurate and earlier by a couple of decades than publicly funded science and governments. We have got that right, yes?

Therefore, when we look around today at who is predicting what for 40 and 50 years in the future we should be looking to what source? The publicly funded science and governments who have been late and wrong? Or the corporate estimates of the future that were early and right?

Assuming that original allegation, claim, insistence, is correct then clearly it’s the latter, isn’t it? The views of those with skin in the long term game - the corporates - have a better view of the future than those playing politics over the same points.

So, for example, rather than believing what politics tells us about the need for the circular economy, recycling everything and the looming shortages of critical minerals we should be looking to the estimates from mining companies about what that future holds. You know, the insistences that we might have a shortage of current holes we get our minerals from but there’s no shortage of the actual minerals themselves?

Oh, good. So, everyone who is insisting that Exxon Knew! is indeed on board with the scientific proof that we’ve not got a minerals problem then, yes? Glad we've been able to settle that one.

Picking winners

From the obituary of a successful entrepreneur:

“I’m a serial entrepreneur,” he said. “I started ten companies up and seven went bankrupt.”

Given that Mr. Zockoll was a successful entrepreneur this gives us a good idea of how many truly bad - or perhaps, things that upon experimentation turn out not to be so good - ideas there are out there.

Which should give us pause for thought about these Tutto nello Stato ideas that float around out there. Given that people with a proven track record of getting it right, with all the incentives to do so, still have this dismal a success rate, then what are we to think of bureaucrats trying the same? Without that demonstrated skill, without the incentives, without, dare we say it, detailed knowledge of the markets themselves?

We’d run with the idea that the bureaucrats are going to pick even more losers than those directly involved and incentivised. There are those who disagree of course but it’s very much less than obvious that they’ve the empirical data to back up their pretension.

One of the grand functions of free to enter markets is precisely this - sorting through ideas that work and don’t work. Thinking about it, planning it, studying it, doesn’t in fact, work. For every business plan works until it first confronts the market. As New Coke showed. Given that this is the test it seems logical to use market players to do the testing rather than those not subject to those market forces - with other peoples’ money to boot.

It's all the capitalists, the neoliberals, the CEOs and markets and, and, and

Mr Chakrabortty applies his well known economic perspicacity to the Royal Mail:

So this is how the Royal Mail ends: killed by lying politicians, lousy managers and ruthless moneymen

Aditya Chakrabortty

Barring the occasional rhetorical twist any one of us can predict how the other 1200 words go.

Sigh.

Now given that Royal Mail is politically, government, influenced we’re not going to argue that the issue has been perfectly managed. But the one bit - a really rather important bit we feel - that Aditya doesn’t remark upon is that all mail systems have exactly this same problem. We out here are simply sending fewer letters.

For Royal Mail, and from different data series so perhaps not entirely comparable, some 20 billion or so in 2004, 8 billion in 2021. No, the collapse did not come as a result of privatisation. Any chart wouldn’t, in fact, be able to visually spot the date of that privatisation. Rather, it tracks the rollout of broadband internet and then smartphones. The background technology has changed.

This produces a vast fiscal or economic problem. The cost of Royal Mail is near entirely the fixed cost of the network. The marginal cost of another letter is as close to zero as makes no difference. That also means that the marginal revenue loss of one less letter feeds near entirely through to the bottom line - the costs of the network have not fallen but revenue has.

Actual serious people have been chewing over this. Perhaps the overhead cost can be reduced by reducing that universal service obligation? Maybe. Or possibly the cost for each letter should triple to cover the lower volume. Maybe. Or some vast subsidy to retain the system. Maybe.

But this problem is not a feature of Royal Mail alone. Every postal system is facing exactly the same problem. It’s therefore not a point of the ownership or management structure of Royal Mail. Which is, sadly, exactly the one point which Mr. Chakrabortty does not examine nor explain, instead blaming everything upon the capitalists and privatisation and, and etc.

Which is a pity. It would have been possible to find out about this if he’d simply read his own newspaper. This is a good explainer for example. At which point we think someone should give Aditya a prize. Imagine, a Guardian column which could be factually improved merely by reading The Guardian?

A big number of a very big number is a small number

Apparently we’ve all got to be poorer. Well, yes, again, but this time it’s because:

The global extraction of raw materials is expected to increase by 60% by 2060, with calamitous consequences for the climate and the environment, according an unpublished UN analysis seen by the Guardian.

Natural resource extraction has soared by almost 400% since 1970 due to industrialisation, urbanisation and population growth, according to a presentation of the five-yearly UN Global Resource Outlook made to EU ministers last week.

To get a handle on the sort of size of number they’re talking about:

Each year, the world consumes more than 92b tonnes of materials – biomass (mostly food), metals, fossil fuels and minerals – and this figure is growing at the rate of 3.2% per year.

Of course we don’t, in fact, “consume”, we borrow for a bit. That old phrase of dust to dust, ashes to ashes, is true at the planetary system level. Say, the use of metals - we might dig them up out of one hole, use them then stick them back in another, mine to landfill, but we’ve not consumed them.

But OK, so 92 billion tonnes, call it 100bn. Up by 60%, let’s give them an inch and call it 200 billion tonnes. Big number.

Except: The lithosphere consists of sediments and crystalline rocks with a total mass of 23,000–24,000 × 10x15 metric tons.

24,000,000,000 billion tonnes.

200 billion is 0.0000008%

In a million years we’ll use under 1% of it (assuming we’ve got the right number of zeroes there all the way through).

This is such a problem that: ““Higher figures mean higher impacts,” he said. “In essence, there are no more safe spaces on Earth. We are already out of our safe operating space and if these trends continue, things will get worse. “ which we think might be a bit of an exaggeration. “The report prioritises equity and human wellbeing measurements over GDP growth alone and proposes action to reduce overall demand rather than simply increasing “green” production.” Ah, yes, we must be more equal and poorer as a solution. How did we guess that is what would be suggested? “Decarbonisation without decoupling economic growth and wellbeing from resource use and environmental impacts is not a convincing answer and the currently prevailing focus on cleaning the supply side needs to be complemented with demand-side measures,” Potočnik said.” That, again, means make everyone poorer.

Yes, sure, 200 billion is a big number even when speaking about government budgets and deficits. But the size of the Earth is a really, really, big number. Against which 200 billion is a grain of a smidgeon of a smear. It’s simply not an important nor relevant number nor percentage.

It’s a great excuse to impose perpetual poverty upon the population, of course it is. But it’s not a good reason. Because a big number of a very big number is a small number.

National Service - tempt, don't force

William Hague seems to think we should reinstate National Service:

The UK needs to move to the same reassertion of citizenship. The best model to draw on is also Scandinavian. Norway has a modern and highly successful form of National Service, keeping up with changes in society as well as the demands of national security. Every Norwegian 18-year-old, irrespective of gender, fills in a questionnaire on their health and motivation. About a quarter of them are chosen for interview, accompanied by physical and intelligence tests. In the latest year just under 10,000 were selected for military service, 17 per cent of the age cohort. They serve for 12 to 16 months.

There are huge advantages to this system. Although some people end up having to serve against their wishes, the majority are highly willing and proud of being selected. Many choose to serve for a longer period. They learn skills that are often of great value in later employment, while mixing with people from other regions and backgrounds all over their country. All of them become trained personnel who form a strong national reserve.

We’re with Milton Friedman on this:

General William Westmoreland, testifying before President Nixon's Commission on an All-Volunteer [Military] Force, denounced the idea, saying that he did not want to command an army of mercenaries.

Milton Friedman interrupted him: "General, would you rather command an army of slaves?" Westmoreland got angry: "I don't like to hear our patriotic draftees referred to as slaves."

And Friedman got rolling: "I don't like to hear our patriotic volunteers referred to as mercenaries. If they are mercenaries, then I, sir, am a mercenary professor, and you, sir, are a mercenary general." And he did not stop: "We are served by mercenary physicians, we use a mercenary lawyer, and we get our meat from a mercenary butcher".

In more detail:

TO MAN THE ARMY with volunteers would require making conditions of service more attractive—not only higher pay but also better housing facilities and improved amenities in other respects. It will be replied that money is not the only factor young men consider in choosing their careers. This is certainly true—and equally certainly irrelevant. Adequate pay alone may not attract, but inadequate pay can certainly deter. Military service has many non-monetary attractions to young men—the chance to serve one’s country, adventure, travel, opportunities for training, and so on. Not the least of the advantages of a volunteer army is that the military would have to improve their personnel policies and pay more attention to meeting the needs of the enlisted men. They now need pay little attention to them, since they can fill their ranks with conscripts serving under compulsion.

Conscription - even into this national service idea, only some of which is military - means that those doing the paying, in the wider sense of all the conditions not just money, don’t have to care very much about what is being paid. For what is offered to slaves can be very much less than what is necessary to attract mercenaries.

This idea of having a less than full time - or lifelong - but trained up reserve has its merits, of course. Which is why we already have one, The Army Reserve, what used to be called the Territorials. If Baron Hague - or anyone else - wishes to increase the number in that then they can fund it properly. Something British Governments have not been doing for decades.

It’s entirely true that there’s a cost to having a decent military. But the costs of enslaving people into it are higher than tempting them. So, tempt, don’t force.

Now they're marching down the street with a chamberpot on their head

Sigh:

Rishi Sunak has vowed to defy the Conservative right-wing by pushing ahead with vaping and smoking bans

It’s not the right wing of anything being defied here, it’s good sense.

We’ve made clear our views on vaping recently - it works in reducing both smoking and teen smoking. Banning, even just restricting it, is therefore the act of fools. No, there is no justification.

There’s an explanation, for of course there is. Hayek pointed it out in Road to Serfdom. Give it long enough and if politics provides healthcare, directly provides it, then politics will be used to control us and our health. That’s not exactly disproven as a thesis now, is it?

As Chris Snowdon points out in detail, this isn’t even going to benefit the health of the nation nor the populace - it’s going to increase the size of the black market, that’s all.

The full announcement is here. Over and above the already mentioned problems, this particularly strikes us:

Five million disposable vapes are thrown away each week, up from 1.3 million from last year. Over a year this is equivalent to the lithium batteries of 5,000 electric vehicles.  

That’s about 50 tonnes of lithium a year even if we are to agree that it could, feasibly, be a problem. So, to “save” the equivalent of two lorry loads a year, 50 tonnes in a 100,000 tonne a year market, of a metal so cheap that mines are closing because they’re losing money, we’re going to expand the black market, harm the health of Britons and severely curtail that basic civil liberty of being able to do what the hell you want with your own body?

This has passed beyond the stage of being fools, they’re marching down the middle of the street with a chamberpot upon their head singing “Woot! Woot!”

Where is that necessary care in the community to teach them that the pot needs to be emptied before being used as a hat?

Where will the UK’s electricity come from in 2050?

The sources of our future electricity are really quite simple but Whitehall, with the best of intentions, is doing their best to mess things up. Renewables, largely wind and solar, will provide the lion’s share at best value – or something close to that. But what about the rest?

In 2022, a record 41.5 per cent of electricity came from renewables. “Around 72 per cent of renewable fuels are used for electricity generation, a third of which is lost in the conversion process.” This illustrates the care that must be taken in distinguishing renewables’ capacity from contribution to demand. The former is the nameplate output from an energy source like wind, if the wind blew at an optimal level all year long and it could all be used for electricity generation with no wastage. Politicians, when discussing renewables, like to talk about capacity, which they can control by commissioning more windfarms, rather than share of demand which depends on weather and which they therefore cannot control.

Even estimating 2020 needs care: UK electricity demand fell 4.7% in 2020 to 281 TWh due to Covid and “UK total electricity generation in 2020 was 312 TWh” but the former figure is demand and the latter is generation. In 2019 “primary electricity” was 11.6 per cent of UK energy consumption so if total energy consumption in 2050 remains about the same but has become 100 per cent electricity, the electricity market will need to have grown by eight times. To maintain its 40 per cent share, renewables would need to match that growth.

An eightfold increase in the size of the 2050 electricity market may be too high. The Government estimates that the total electricity demand in 2050 could range from 370 TWh to 570 TWh, depending on the level of electrification and energy efficiency. This is clearly too low. McKinsey’s predicts that the electricity demand could reach 800 TWh. Nearer the mark.

National Grid ESO, in one of their future energy scenarios for 2050, think that the range of capacity required for electricity will be between 285 and 387 GW to deal with annual demand up to between 570 TWh and 726 TWh. They estimate that the wind and solar capacity will be between 149GW and 239GW which leaves between 135GW and 148GW to supplied by nuclear and fossil fuels with carbon capture.

That compares with government expectation that the 2050 electricity capacity will total 96GW with nuclear supplying 25 per cent of that. About 6.4GW of that will be provided by Hinkley Point C, approved 2016, and its twin Sizewell C, frequently announced but still not approved.  24GW is too small a target for nuclear and would leave over 100GW to be supplied by fossil fuels, deeply unpopular even with carbon capture. Industry sources, that cannot be quoted, reckon that 48GW would be a far more realistic target.

 Hinkley was supposed to be built by 2020 at a cost of £12 billion; the latest estimates are completion in 2031 and a £44.3 billion bill.  Apparently “there were 7,000 substantial design changes required by British regulations that needed to be made to the site, with 35% more steel and 25% more concrete needed than originally planned.” Of course we fully understand that, seven years after approval, the designers could have had little idea how much steel or concrete was required or what the regulations would be.

Sizewell C was touted as costing a mere £20 billion because of the savings from being the Hinkley Point C twin.  Professor Thomas of Greenwich University thinks £40 billion is more likely with a 10 – 12 year construction time, i.e. 2036 if a decision is made this year.

It is astonishing that the government is hell bent on continuing with these monsters. They are planning another six large reactors (albeit smaller at around 1 GW) after Hinkley and Sizewell. Assuming this plan for the larger reactors is implemented, then we would need about 120 SMRs @ £300 million each to be up and running by 2050.  No sign of that in government plans.

Large reactors take at least 10 years to build and will be providing electricity to the Grid at a price which is estimated to be at least 50% more expensive than the forecast price for electricity from Small Modular Reactors (SMRs).  SMRs should take about 6 months to build in a factory or shipyards and about 2 years to install for the first unit of a multi-SMR facility with installation times falling to 12-18 months per subsequent unit. The reason Sizewell C took so long to gain approval was that no one but HM Treasury was stupid enough to invest in it. Even the French who own the EDF company responsible for Hinkley and Sizewell are trying to back out of paying for them.

SMRs will typically cost in the range £2.1 million to £3 million per MW to build compared with the current estimate of £14.4 million per MW for Hinkley point C. Thorcon quotes £800 million per GW, i.e.£240 million for a 300 MW SMR. Rolls Royce leads the UK race for reasons good and bad and is offering SMRs here for rather more than Thorcon’s offer. Poland has already ordered 30 SMRs. Yet this government plans not to make any decision on the first SMR until 2029, presumably to avoid having to undertake the required value for money comparison between SMRs and Sizewell C. It claims to be a world leader but actually it will be last in the queue. “To recover the UK’s global leadership in civil nuclear” could be irony or could be evidence that some distant corner of HMT has a sense of humour after all.                                                                 

Well, yes, we suppose so

To get to net zero, we may have to sell off the UK’s future

Something of a headline in The Observer there.

The observation is that getting to this Net Zero by 2050 target is going to be howlingly expensive. We might have to sell off all the assets owned by government to finance it.

What this tells us, of course, is that it’s the target which is wrong. As the Stern Review itself pointed out. The aim is to make us better off over time. Climate change will have costs, dealing with climate change will have costs. Dealing with climate change will have benefits, not having to spend on climate change has benefits. So, we need the finest balance of costs and benefits that we can reach.

That means, obviously, balancing costs and benefits. Not a target that must be reached at any cost. And the Stern Review is entirely clear on this - if those costs change, as is claimed here, then the amount of dealing with climate change that we do should also change. Which is exactly what people are not admitting, let alone doing.

Why, it’s almost as if people are using the Stern Review - and other such economic investigations - as excuses for what they desire to do anyway rather than as guides to good policy. That can’t possibly be true though, can it, for politics really never does work that way.

No, really. Never.