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Articles by chris

Character, context and work

4 days ago

It is fitting that Donald Trump should leave office in the same week that Phil Spector died, because both remind us that the quality of a man’s character is not the same as the quality of his work.
As a human being, Mr Trump recalls the words of the great Fred Thursday: he’s worth nowt a pound, and shit’s tuppence. As a president, however, his performance wasn’t quite as disastrous as his character. He didn’t start any new wars (though he did continue old ones); broke the confines of fiscal orthodoxy; (marginally) reformed the awful criminal justice system; and showed an awareness that millions of Americans were let down and alienated from conventional politics. Of course, there’s huge downsides too – on immigration policy and climate change not to mention the mishandling of Covid

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Debates, fake and genuine

7 days ago

There might not be any general purpose experts, but there are general purposes idiots. That’s one inference from Ipso’s ruling that one of Toby Young’s Covid denialism columns was “significantly misleading.”
In fact, though, this episode tells us something more general about the nature of capitalist power.
The thing is that Young is not an isolated fool. There is a small industry of Covid-deniers, as Neil O’Brien (one of the few Tory MPs brave enough to make a pubic display of intelligence) reminds us. Which poses the question: why do people with no knowledge of medicine or epidemiology feel the need to jump in with silly takes?
It’s because they have an incentive to do so: there’s a demand for gobshites. And it doesn’t come only from trash media such as talkRADIO or the Telegraph. It

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On forecasting

11 days ago

What’s the point of forecasting? This is the question posed for me by Michael Story’s account of superforecasters’ predictions for the course of the pandemic.
Take this:

Our central estimate that the death toll will peak at 1,278 with an 80% confidence interval of 892 to 5,750.

So what? It’s not all clear how this affects the debate about how tight the lockdown should be. That depends upon how the virus is transmitted; the trade-off between mental and physical health; how far the economic effects of the lockdown can be mitigated; and so on. Yes, that claim that the daily death toll could be 5750 is alarming, and speaks to the need for a tight lockdown. But you don’t need any precise number to make that case. The mere chance of a high death toll does as well.
Similarly the

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On fantasy politics

15 days ago

One of the great political divisions today is between those who acknowledge reality and those whose politics derive solely from the voices in their head.
After Trumpites stormed Congress earlier this week Ian Austin tweeted that “I don’t believe the hard left would have accepted an election defeat” – ignoring the fact that only 13 months ago the left did indeed accept Labour’s defeat peacefully.
And then Matt Goodwin tweeted:

Johnson is socially liberal at heart, Trump is authoritarian. Johnson is instinctive free trader, Trump is protectionist. Johnson is pro-migration at heart, Trump is xenophobe.

Again, this is untethered to reality. As mayor of London, Johnson banned alcohol on the tube and tried to use water cannon on protestors; he was a member of the government that pursued

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On bad government

17 days ago

There’s general agreement that the UK government has handled the pandemic badly in many (though not all) respects. Why?
It’s tempting to claim that ten years of Tory austerity has reduced the effectiveness of government and diminished NHS capacity: the UK has fewer doctors, hospital beds and ICU spaces than comparable countries.
Such a claim, however, runs into a problem. By some measures, the UK was actually reasonably well-prepared for the pandemic. In October 2019 the Global Heath Security Index ranked (pdf) the UK second in the world in its preparedness for the pandemic (just behind the US!). And the World Bank’s measure of government effectiveness placed the UK alongside the US and Taiwan – one of whom has handled the pandemic well and the other badly – and far above Vietnam,

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What’s given, what’s not?

20 days ago

There is much talk of how Covid is putting pressure on the NHS. Such talk, however, often misses an important fact – that although NHS capacity is more or less fixed in the short-term, it is certainly not in the long-run. And past political choices have limited this capacity. For example, the UK has 2.8 doctors for every 1000 people compared to an average of three in OECD countries generally and more than four in Germany, Italy or Switzerland. We have only 2.46 hospital beds per 1000 people, compared to 8.0 in Germany or 5.9 in France. And we have fewer intensive care spaces than the average developed economy.
The NHS is under pressure because of past political decisions to limit its capacity. Failing to point this out exonerates what should not be exonerated – namely, a decade of

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Alienation & doublethink

December 16, 2020

“The right side lost, but the wrong side won”. I was reminded of John Le Carre’s assessment of the Cold War by a recent exchange in which Allison Pearson claimed that she knew “hardly anyone” who knew somebody who’d had Covid only to immediately say that her whole family had had it.
This seems nonsensical. But it’s not. It reminds me of what happened in the former USSR, where the conflict between the reality of day-to-day life and the imperative to conform to ideology led to an Orwellian doublethink. As Timur Kuran has written:

The individual citizen’s mind was divided into two layers, one “pragmatic” and the other “ideological”. The former layer contained the practical information necessary to get things done, derived mostly from experience…The latter consisted of abstract

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Restraining capital

December 13, 2020

Martin Wolf argues that Milton Friedman was wrong to claim that the only social responsibility of business is to increase profits. I agree with him, but I fear he under-rates two important facts: historical context and class power.
Friedman thought (pdf) that profit maximization promoted the social good only under two conditions.
One, stressed by Luigi Zingales, is that markets must be competitive. Where this is the case, corporations have little power to egregiously exploit consumers or workers. In fact, they must maximize profits or go bust – and going bust is rarely in the public interest.
The second is that profit-seeking is only socially desirable so long as the firm “stays within the rules of the game, which is to say, engages in open and free competition without deception or

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News versus emergence

December 5, 2020

From an economist’s point of view, there are two big facts about the public finances. Fact one is that the government is now being paid to borrow. 20-year gilt yields are minus 2.5% which means that for every £100 the government borrows it must repay only £60 over the next 20 years. Fact two is that record government borrowing is, by definition, the counterpart of the fact that the household savings ratio hit a record high in Q2.
Many political journalists, however, underweight these facts. Laura Kuenssberg talks of the nation’s credit card being maxxed out, whilst Matthew Parris rages at those of us who have the temerity to criticise her.
Which poses the question: why is there just a gulf between political journalists and economists here?
I suggest it’s because political journalists

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Maxxed out?

November 26, 2020

Laura Kuenssberg said yesterday:

“This is the credit card, the national mortgage, everything absolutely maxxed out. Enormous levels of the country basically being in the red.”

This is obviously the most abject drivel. (Hint: how many credit card companies will pay you to borrow when you are at your credit limit?) What interests me, though, is: how can any sentient being utter something so stupid?
Some of you will blame dishonesty and partisanship. But I suspect some more interesting, and insidious, errors are at work.
One is something I’ve complained about before. The BBC is insufficiently aware of emergence – the fact that many social phenomena are the product of human action but not deliberate design.
The public finances are one such phenomenon. It’s true that government

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Full employment, capitalism & regress

November 18, 2020

The Guardian is reinventing the wheel. Its leader yesterday said:

Nobody but the government can take responsibility for maintaining the total level of spending in the economy at a level that keeps the country as close to full employment as possible.

Like all the best ideas, this is not original. In fact, it’s as new as powdered eggs or Woolton pie. It echoes this from William Beveridge in 1944 (pdf):

It must be a function of the State in future to ensure adequate total outlay and by consequence to protect its citizens against mass unemployment. (Full Employment in a Free Society, p29)

Which poses the question: why has Beveridge’s thought been so forgotten that it must now be rediscovered?
The answer is that, by the mid-70s, full employment was causing inflation, industrial

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Our priorities

November 13, 2020

One of the dafter genres of political writing is the offering of unsolicited advice to leaders. Nevertheless, I’d like to suggest what I would do if I were Sir Keir Starmer. You can think of this as advice if you’d like, but I’d rather regard it as a way of contrasting two different types of politics.
What I’d do is to greatly beef up the party’s National Policy Forum, giving it more resources, a much higher profile and emphasising that it is open to all. We need ongoing informal and widespread public inquiries in which experts, the public and interest groups are engaged. These should be exercises in deliberative democracy in which devices such as citizens’ juries are combined with academic research.
Connecting with grassroots is not an alternative to technocracy. The two are

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Farage’s dangerous appeal

November 4, 2020

Nigel Farage’s effort to rebrand the Brexit party as an anti-lockdown faction poses the question: what’s the link between being pro-Brexit and anti-lockdown?
It might seem there’s none. Sure, anti-lockdowners are proclaiming the virtues of freedom. But the anti-migrant sentiment Farage stirred up during the Brexit referendum is the antithesis of libertarianism. If we put it nicely, Reform UK is an unstable coalition between cultural conservatives and libertarians. Less nicely, it’s just another toxic grift.
Perhaps, though, there is a common theme between hostility to migrants and the lockdown. It lies in something Richard Sennett wrote fifty years ago in The Uses of Disorder. Social life, he said, is a process of awkward encounters not just with other people but with a reality that is

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“A great deal of ruin”

October 30, 2020

“There is a great deal of ruin in a nation” wrote Adam Smith in 1777, suggesting (possibly) that countries can cope with poor policies. These are wise words, in many contexts.
Take for example, the NAO’s claim that there is “likely to be considerable amounts of fraud and error” in the government’s furlough scheme and the Resolution Foundation’s estimate that the government has paid around £1.3bn to self-employed workers who in fact suffered no loss of income. No doubt this is sub-optimal, an element of ruin. But this is not in itself a decisive objection to the schemes. It was essential that people hit by the lockdown got quick support. And as the old saying goes: “Good, fast, cheap: choose two.” In choosing “fast”, the government sacrificed a little “cheap”. It incurred some ruin. But

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The economic base of culture wars

October 24, 2020

The long boom of the post-war period gave us trades union militancy, “women’s lib”, the Black Panthers, the gay rights movement and the legalization of abortion and homosexuality. Our recent stagnation has given us Trump and Brexit – and of course the economic crisis of the 1930s yielded much worse.
Which is another way of saying what Ben Friedman wrote in The Moral Consequences of Economic Growth – that economic growth gives us liberalism and demands for equality whilst stagnation and regress give us political reaction.
This, I fear, helps explain something that is otherwise odd – that the Tory party has pretty much renounced economics. As Stian Westlake has said, “the Tories, both in government and more generally, seem to have stopped talking and thinking about economics.” Evidence

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Stealing “libertarianism”

October 8, 2020

What exactly is libertarianism? I ask because of something Janash Ganesh says about Trump:

His populism tends more to the libertarian than the repressive. The mask-spurning, the cavalier gatherings, the call to not let the virus “dominate”: it is personal freedom to which the president has shown a heedless attachment.

Now, the notion that Trump is a libertarian will come as news to the families of George Floyd or Breonna Taylor or the 829 other people killed by the American police this year. It’ll also come as news to the tens of thousands of people imprisoned for trivial offences. A true libertarian would surely be more troubled by these horrific denials of freedom than they would by wearing masks.
The misuse of the word "libertarian" is however not confined to Janan’s

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On feudal exploitation

October 7, 2020

“We have abolished capitalism in Poland. Now we must abolish feudalism.” So said Michal Kalecki in the 60s. I suspect that western economies today face a similar task, as feudalism is still rife.
By this, I don’t mean merely that we have the high inequality and low social mobility that characterised feudalism, nor that immigration controls are a form of feudalism in that they ensure that one’s life chances are determined at birth.
Instead, I’m thinking of modes of exploitation.
We must distinguish between capitalist exploitation as Marx understood it and feudal exploitation. The former is an economic phenomenon, arising from capital’s greater economic power over labour. The labour market, thought Marx, was “a very Eden of the innate rights of man. There alone rule Freedom, Equality,

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Savers, capitalism & self-interest

September 29, 2020

Do people vote in their own material interests? I ask because of the decision last week by NS&I to cut interest rates to almost nothing.
In doing so, it is only bringing its rates into line with market rates. Which tells us two big things.
One is tha the pandemic has exacerbated a long-term downtrend in interest rates.
The second is that from the point of view of savers (let alone anybody else) the government is not borrowing enough. One reason for NS&I’s decision is that it was raising more cash than the government needed – in part because the same pandemic that has raised government borrowing has also made forced savers of many of us and so raised the savings to pay for that borrowing.
From all this, savers should infer two things. One is that capitalism is serving them badly.

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Blaming the voters

September 20, 2020

In the Times, Matthew Parris wrote: "this Prime Minister is ultimately our [the electorate’s] fault." I tweeted that this was absolutely right, but got a little pushback. I should therefore elaborate.
What I and Matthew meant was that Johnson is not doing anything unexpected. He is merely living down to what everybody knew about him. As Matthew wrote:

There was never any reason for confidence in Boris Johnson’s diligence, his honesty, his directness, his mastery of debate, his people-skills with colleagues, his executive ability or his policy grip. We’d seen no early demonstration of any of these qualities but we just blanked that out.

Voters, then, are getting what they voted for. Those who voted Labour in 2001 could say of the Iraq war “I never voted for that”. Those who voted

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Conceptions of politics

September 15, 2020

There is a great and overlooked political division today – between those who think policy matters, and those who think it doesn’t.
Here are some examples of what I mean.
First, Ed Miliband’s speech on the Internal Market Bill was that of a man who thinks a consistent policy would be a good thing. He is exercised by the fact that a man who greeted the signing of the Withdrawal Agreement as a “fantastic moment” now regards it as “contradictory”. Johnson, however, seems to attach no importance to the need for a consistent policy.
Secondly, Rishi Sunak has the highest approval rating of all cabinet ministers among Tory members, even though employment is slumping: the ONS reported today that payrolls have dropped by 629,000 in the last 12 months, a trend economists expect to continue. A

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The Hayek question

September 11, 2020

Thatcher was right. This is my reaction to reports that Dominic Cummings regards Brexit as a way of getting out of limits on state aid and so enabling the government to funnel cash towards the UK’s own future big tech companies.
The problem with this is that, as Thatcher said, the state cannot pick winners. Corporate growth is largely unpredictable. “The stochastic element is predominant” concluded Alex Coad in one survey. “Corporate growth rates are random” found Paul Geroski in another (pdf). “There is low predictability [of corporate earnings growth] even with a wide variety of predictor variables” found (pdf) Louis Chan, Josef Lakonishok and Jason Karceski in a third.
This fact explains why fund managers don’t beat the market. David Blake has concluded: "the vast majority of fund

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On press freedom

September 10, 2020

In The Enigma of Reason Hugo Mercier and Dan Sperber argue that the main use of reason is to justify and explain conclusions that we have arrived at sub-rationally. Some reactions to Extinction Rebellion’s blockading of newspaper distribution centres seem to me to illustrate their point.
For example, Culture Secretary Oliver Dowden said their action “damage[s] our democracy”. Johnson said: “A free press is vital in holding the government and other powerful institutions to account.” And Ian Murray, executive director of the Society of Editors, said that “shutting down free speech and an independent media is the first action of totalitarian regimes and dictators.”
Such fancy talk attributes to the press a sanctity it does not merit. And it’s not needed. If XR had blockaded a Cheesy

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On Marxist Tories

September 2, 2020

In one respect, the right-wing conspiracy loons are right: Marxists have captured some of our major institutions – the institutions being the government and Tory party.
I say this because of the campaign to stop us working from home and to get us back into offices. Such a demand is justifiable only if you take a very dark opinion of capitalism.
Those who have faith in capitalism see upside in home-working. Andrew Sentance tweeted:

Why are so many people focussing on the negatives of working from home? It is a great opportunity to reduce transport emissions, stop spread of disease through commuting and mingling at work/in city centres, and provides a more flexible and family-friendly working environment.

To this we should add that whilst WFH does depress demand for retail businesses

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Clarity – who needs it?

September 1, 2020

Tim Pitt calls on the government to set out “a renewed Conservative economic philosophy.” I’m not sure this is wise. Having a clear philosophy requires you to think, which is not a self-evidently good thing in life or in politics. Worse still, it gives people something to disagree with, and so invites party disunity. Constructive ambiguity can be a good thing.
I say this because a new Conservative economic philosophy requires the party to answer loads of tricky questions. Here are a few.
Are you pro-business or pro-markets? Pro-market policies would promote competition by for example relaxing intellectual property laws, reducing planning restrictions, simplifying regulations,  expanding the British Business Bank to encourage start-ups and imposing tougher rules against mergers and

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Tories against Thatcher

August 28, 2020

Be careful what you wish for. This old saying applies to us lefties. For years, we’ve wanted to see the end of Thatcherism. And we’ve now got it. And it’s an ugly sight.
I say this because of Johnson’s campaign to end working from home and get us back into the office. This is anti-Thatcherite in two senses.
For one thing, Johnson is contradicting two of Thatcher’s favourite principles – that “you can’t buck the market” and that managers have a right to manage. Many big employers are happy for staff to continue working from home. So why should the government say otherwise? Ryan Bourne expresses the spirit of Thatcherism when he says it is “quite frankly none of the govt’s business” to tell us what we should be doing.
Also, Johnson is motivated by a fear that city centres are becoming

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The politics of life & death

August 26, 2020

What, if anything, is wrong with the Kaldor-Hicks principle? This is the question raised by Chris Whitty’s argument that the benefits of reopening schools outweigh the costs of doing so.
Even if we suppose that this is factually correct – which it might not be – it does not follow that it is right to reopen schools. As David Hume said, we cannot derive “ought” from “is”.
Which is where the Kaldor-Hicks principle comes in. It says that a policy change is an improvement if the beneficiaries of it could compensate the losers and still remain better off – even if compensation is not actually paid. This idea fills the Humean gap between the statements “the benefits of reopening schools exceed the costs” and “schools should reopen”.
Which leads to the question I started with. I fear there

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For (and against) a sovereign wealth fund

August 21, 2020

In their excellent Angrynomics Mark Blyth and Eric Lonergan recommend that the government borrows at negative yields to establish a sovereign wealth fund. There’s more to be said for this than they think, because the UK is better situated than many countries to have such a fund.
My chart shows why. It shows that sterling tends to fall when house prices do. In the mid-90s, 2008, 2011 and last year weakness in the housing market was accompanied by a weak pound.
Now, I’m using house prices here as a proxy for something more general – bad times for the UK economy generally.  The chart therefore tells us that a UK-based investor makes a profit on foreign currency assets when the UK economy faces hard times. Although house prices didn’t fall then, the Brexit referendum in  2016 is another

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Cents and sensibility

August 20, 2020

Would Labour have handled the A level fiasco better than the Tories? There’s a reason to think so, and it has nothing to do with the parties’ relative competence.
Instead, it’s because Labour ministers would have had different sensibilities, or sympathies. They would have been more awake than the Tories to the situation of 18-year-olds from poor schools and hence more alert to developments which might hurt them.
The point here is a Smithian one. Smith thought that sympathy “arise[s] from an imaginary change of situations with the person principally concerned.” But, as Smith saw, our imagination is limited. It’s easier to put yourself in someone’s shoes if you have actually been in them, or if you have friends or family in those shoes, or if you expect to be in them later. Although

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Algorithms & reification

August 18, 2020

The A levels U-turn has prompted the question: what went wrong with the algorithm?
The answer is: nothing, zip, diddly, jack.
What went wrong wasn’t the equation, but people. People create algorithms and they do so according to the principle garbage in, garbage out. The error here was not of high-level maths. It was a basic failure to appreciate the nature of statistics. Statistics cannot discover what isn’t there. And the information we really needed – how to compare students across schools – just wasn’t there. As the great Dan Davies puts it:

No statistical method in the world is going to be able to give you good results if the information you’re looking for is fundamentally not there in the dataset that you’re trying to extract it from

The problem wasn’t the algo. It was that

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Empirical vs fantasy politics

August 16, 2020

News items this week have highlighted an under-appreciated political division – between issues that involve clear harm to identifiable individuals and those that don’t.
Contrast the crime* that is the mishandling of A levels with reports of migrants crossing the channel in dinghies. There’s a massive difference between the two. The mis-marking of A levels imposes real suffering upon identifiable people. But a few migrants in dinghies do not: even if you believe – wrongly – that immigration cuts wages and jobs, it is not the few desperate people who arrive in boats that are doing so.
The latter – what Chris Grey calls an “artificial emergency” – is not the only example of reified, unempirical politics that is unconcerned with real material harm. The BBC reports on record government

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