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Monthly Archives: August 2010

Report: House Prices Are Too High And Not High Enough

Council-type housing stock in Weaverham, now m...

Some housing, obviously

Looks like we’re all discussing house prices again:

Homeowners who bought at the peak of the market may face four more years of negative equity, a housing group has warned.

The organisation, which campaigns for affordable housing, also said prices are still too high for many buyers.

So are they complaining that house prices are too low … or that they are unaffordable?

“… the big problem that we have is that we’ve created a kind of perfect storm where there is negative equity for some people and they’re trapped and can’t move, but prices haven’t come down enough to make buying a home a realistic option for people in their 20s and 30s in ordinary jobs.
“We really are in danger of pricing people out of owner-occupation.”

Ah, both.

The National Housing Federation (NHF) have indulged in the modern and annoying use of “we” when the passive voice and the word “some” would be more appropriate. Many people have not overstretched themselves and thus aren’t “trapped” since the dip in prices won’t have wiped out their equity, others may have negative equity now, but aren’t planning to move any time soon, so it’s all academic to them.

That bit of pedantry aside, in some ways “we” could refer to the NHF, or at least their members. The basic factor in house prices is, of course, the cost of the land. Planning law plays its part in driving up land prices due to scarcity, but there is also demand. Here, the usual refrain is to blame all those nasty buy-to-let landlords who buy up properties thus driving up the prices, and at the same time leaving first-time buyers with little option but to rent, usually from the buy-to-let landlords.

So who are the biggest buy-to-let landlords? Yep, the members of the National Housing Federation. And what is the NHF’s solution to the problem? Given that they are complaining about the cuts to their members’ funding, it would seem to be to buy more land to build on, which will drive up prices, which will have the effect of forcing more people to turn to social landlords.

Not that I’m suggesting some conspiracy on the part of housing associations, of course. However, if they wanted to help tackle the so-called ‘housing crisis’ and enable more people to become owner-occupiers, then they could start lobbying, say, for easing the rules for the ‘right to acquire’ scheme, maybe the ability to give higher discounts, and perhaps the issuing a press release endorsing some or all of the Policy Exchange’s suggestions, also out today (trailed by Iain here).

The Joy Is Fading

Well, only number 4 of Richard Murphy’s “The Joy of Tax” series, and he’s already getting desperate.

We need police.

We need laws enforced.

…. A coherent system of law and order underpins a society. Only government can command and direct such a service. Only government can pay for it.

That’s the Joy of Tax.

When you have to set up such extreme straw men arguments to support your position you really should just give up and change tack.

Wanting lower and less complicated taxes does not mean you want to do away with the police … or, before anyone suggests it, any of the other emergency services, the armed forces, even a properly structured basic healthcare system, or to do away with government altogether.

Of course, asserting that government should “command and direct” the police force is another debate altogether, and only one with a touching and unassailable faith in the benign goodness of government – and a short memory viz. the arrest of opposition MPs and abuse of anti-terrorist laws – could not notice the irony of such a statement.

Mark Thompson: How To Miss The Point In 1400 Words

At Friday’s MacTaggart lecture at the Edinburgh Television Festival, Mark Thompson, Director-General of the BBC, devoted some time to various bees that he has in his bonnet. In fact, his speech was heavily trailed in a piece he wrote in the Guardian on Wednesday about, variously, the licence fee, BBC independence, competition from Sky and re-transmission fees.

However, it’s difficult to know whether he is deliberately avoiding the main problem with the BBC or is so immersed in the BBC groupthink that he cannot see it.

Television Centre, the main broadcasting centr...

Everything at the Beeb is rosy, apparently. Or maybe not.

As you will tell if you read the whole thing, he covers a lot of ground, so let me boil it down thus:

  1. The BBC is independent and people love it
  2. Sky is rather good at what they do (except they don’t buy enough British programmes)
  3. Sky should pay money to the BBC

On broadcasters’ independence:

“A staunch history of editorial independence from political and commercial influence has been as fiercely defended by the commercially funded public-sector broadcasters as by the BBC – think of Thames and Death on the Rock – and it is what makes possible the impartiality in and beyond the news which British audiences prize.”

I know, “commercially funded public-sector” is something of an oxymoron.

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Chuggers Under Fire Again

“What have they got against a harmless children’s TV programme about talking trains? I mean, I know Chuggington looks like a rip-off of Thomas the Tank Engine, but come on…?”

Chuggers: why can't they just leave innocent shoppers to go about their business?

If you have children (or grandchildren) of a certain age then this may well have been your initial reaction to the reports across the BBC this evening. In fact, it’s all about ‘charity muggers’, those direct-debit-mandate-wielding types who approach you in the High Street to get you to donate to or join a charity.

It is, of course, just another plug for a BBC programme (Newsnight) masquerading as a news item, à la the examples in the “I-Sky” column in Private Eye (after all, the BBC’s supporters are always saying that the corporation is better at doing things than Sky).

Of course, the activities of ‘chuggers’ – whether you regard them as using emotional blackmail, hard selling or just making a general nuisance of themselves – are using tactics that are put well into the shade by those other professional seekers of funds for ‘public benefit’: TV Licensing. I wonder when BBC Newsnight will be investigating that particular outfit?

Always Someone Else’s Fault

1 plus 1 equals 3It must be great not having to hold down a proper job in order to make a living. You could be an academic research professor, for example, like George Irvin. Don’t blame the baby-boomers, he says, it’s all a right-wing conspiracy/Thatcher’s/the City’s fault. Take final-salary pensions for example:

Final salary-linked pensions have virtually disappeared in the UK because occupational pension savings were handed to City fund managers who made millions from investing them in stocks and shares. Some companies even took “pension holidays” to boost their share prices. When the market collapsed, so did “funded pensions”. Yes, of course there is a demographic problem, but most other EU countries have made reasonable provision for topping up their pay-as-you-go schemes.

Here we go.

No, George. Final salary-linked pensions have virtually disappeared because (a) they were fundamentally unsustainable, (b) a certain Labour chancellor helped himself, from them and their money-purchase counterparts, to £5bn a year (and still overspent the national budget) and (c) companies were forced to start loading a more realistic measure of the liabilities of said pensions onto their balance sheets after a change in the accounting rules.

By the way, if those evil satan-spawned “City fund managers” hadn’t invested them in stocks and shares, then the situation would have been even worse.

A funded pension won’t “collapse” because of any “market collapse”. As one nears retirement, more of the pot is transferred into cash and bonds, sheltering it from the fluctuations of the stock markets. The younger contributor will see their pension fund reduce in value, but they also have time to take advantage of market rises, and anyway what is the alternative? An unfunded scheme that forces a pensioners still-working colleagues to pay for his retirement – either through their own contributions or taxes? How very fair. Not.

Oh, and just because other EU countries have found some money to shovel into the black hole made reasonable provision for topping up these unsustainable schemes, it doesn’t mean they’re still unsustainable or not one small step removed from Ponzi schemes.

As for the basic point of George’s article, no I don’t blame the baby boomers. I blame those of the baby-boomers’ parents who voted for the socialists that dumped some nice but financially ill-thought out ideas on us.

H/t Tim, who has rounded on another excerpt.

Being Charitable

Pakistan Floods: Evacuation

Now here’s something we’re good at:

UK public ‘shaming world politicians’ over Pakistan aid

Brendan Gormley of the DEC: “UK public are shaming politicians across the world”

The generosity of the British public in helping Pakistan’s flood victims is “shaming politicians around the world”, the head of the Disasters Emergency Committee (DEC) has said.

Brendan Gormley, chief executive of the DEC, said the UK public was leading the way in donations, but that further funds were urgently needed.

The DEC’s Pakistan Floods Appeal has now raised more than £30m.

Critics say the world community has been too slow to respond to the crisis.

Mr Gormley said that while the response of the UK government was to be respected, other nations had been slow to react to the situation in Pakistan that was continuing to affect more than 20 million people.

That the British public have, individually and voluntarily, donated such a vast amount is a ‘feather in the cap’, and it would be churlish to suggest that every penny, wherever it comes from, isn’t desperately needed and should in some way be denied to the victims in Pakistan.

However, there is a philosophical point raised by Mr Gormley’s remarks that, perhaps in a less fraught moment between disasters, could be pondered. That is, why make such a comparison between donations made by governments and those made by individuals? The thing is, it’s much easier to be charitable with other people’s money and, it could be suggested, is far less altruistic.

I have no problem with the DEC asking me for my charity, but should the government take it upon itself to force my ‘donation’? That donations from the public have reached such a level may actually undermine the case for direct contributions by government. However, I expect that in part there is the argument that bolstering such aid with state monies, particularly in this case, helps to prevent the likes of the Taliban and other anti-Western forces taking advantage of the situation; international development, I imagine, often has such deeper ‘foreign policy objectives’.

Anyway, that’s enough of the obsessive political dissection, the DEC website is over here. Incidentally, there was an interesting profile of Brendan Gormley (apparently once called “the Thatcher of Development”) earlier this year in The Grauniad, and which included this nugget for the pub quiz-masters: Brendan is an elder brother of Anthony ‘Angel of the North’ Gormley.

Oh Joy: Tax

Income tax

Richard Murphy is an accountant who loves tax, and not just because it has provided a career for him (as for many of my profession). He and Tim Worstall aren’t best buddies and it is via Tim that we hear of Richard’s latest evangelical wheeze: a series of posts and tweets entitled – and I kid you not – “The Joy of Tax”.

In fact, I suspect we are in for a concise and easily digestible series on how Lefties Don’t Get It, as Richard labours under the usual flawed assumption that if the State doesn’t do it, then it cannot happen.

Has he mentioned the armed forces, or the emergency services? Both, though they theoretically could (and indeed have been) provided privately, would be easier examples to justify his position.

No, yesterday it was nature reserves that were the fruit of the collective’s largesse. (Let’s just pretend that the National Trust never existed eh?)

Today (number two in the series) we learn that without taxation we wouldn’t have any roads. Presumably, then, before socialism delivered its tarmac utopia unto us, people used to levitate around the place.

Actually, I’ve just realised something: my computer wasn’t supplied by the State … it’s dissolving into thin air before my eyes … now I can’t ….

Fearing the Worst – Giving Polly a Good Fisking

Polly Toynbee speaks at the October 2005 Labou...

Polly Toynbee, with her mouth in gear

Polly Toynbee was churning out incoherent ramblings again last week. Unlike mine, though, she gets paid for hers. As Guido suggests, perhaps she’s got financial worries on her mind, like so many in the real world beyond the Grauniad offices. (Was it coincidence that this came out hours after her husband was told he’d be out of a job?)

Where Cameron and Osborne have been most successful is in frightening people … However, fear can be useful politically. Cameron’s government has skilfully created a hate campaign directed at the public sector. The release by Eric Pickles this week of all the spending data from his department and its quangos was admirable openness – but mainly a crafty assault on everything spent by public servants. Anecdotes work. People are easily persuaded that the handful of civil servants paid more than the prime minister are typical and that Indian head massages are the norm.

Yes, Polly, anecdotes can be powerful things, which must explain why, having piously cited David Cameron’s efforts, you serve up this:

… the public sector can be lax, but where is a comparison with lavish corporate hospitality at Wimbledon, Twickenham or the grand prix all paid for from peoples’ pension funds? A public employees’ £539 group awayday to Blackpool Pleasure Beach is less than the champagne bill for a public company’s beano at the races.

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Clamping Down on Freedom

So the new look One Show had a scoop last night with the news that the new Freedom Bill will include a provision to make illegal the clamping and towing away of cars parked on private property. Cue much rejoicing at all these cowboy clampers and evil landowners getting their just desserts.

It has been followed up widely elsewhere this morning:

Wheel-clamping on private land by “cowboy” clampers is to be banned, ministers will say.

Lynne Featherstone, the Home Office minister, will announce plans to curb the activities of clampers in England and Wales.

Ms Featherstone will say the rules should be brought into line with those in Scotland, where clamping on private land was banned after a judge said it amounted to ‘extortion’ and ‘theft’.

The Daily Telegraph understands she will to speak to the Justice Ministry in Northern Ireland about banning the practice there too.

Ms Featherstone, a Liberal Democrat minister in the Home Office, said a ban on their activities was “very good news”.

She said: “I am delighted that our Government have made the decision to ban it outright. It is a ban and thank goodness.”

Ms Featherstone said that proposals to ban clamping on private land, such as company or supermarket car parks, would be included in a new Freedom Bill to be introduced in November.

The legislation will also include measures to stop companies towing away parked cars on private land without permission.

Now, where do I start?

One problem that we saw frequently under the last administration was the problem of lazy government. Featherstone was saying this morning that governments have tried to tackle the problem of “cowboy clampers” but have failed. Well then they haven’t tried hard enough. Banning clamping and towing-away will not just tackle the cowboys, but also the many reputable companies that operate in a perfectly reasonable way. Regulation (covering, say, signage, maximum fines, etc) would take a little more thought and time, but would be the more common sense approach.

Whatever, it all makes good headlines, eh?

Private landowners (or “greedy landlords” depending on your point of view) can just use barriers or fencing to protect their land, said Featherstone. Fine Lynne, but what if someone outstays their ticket, or happens to “tailgate” their way into a car park or finds some other means of entry? If someone trespasses on my land, surely I have the right to use reasonable means to eject them?

The second problem here is that “Liberal” Democrats and other modern liberals have forgotten what freedom and liberty should be about. It doesn’t mean that you can do what you like (such as parking on some else’s land without, or beyond, their permission). It means you can do what you like as long as it doesn’t restrict someone else’s freedom. Unfortunately, too often the right to own property, and the freedom to enjoy that property is being steadily eroded.

This clouded view of “freedom” is highlighted in that way this measure is to be introduced. The purpose of the Freedom Bill, one might have naively thought, is about reducing the number of laws and rules that the state has imposed on us, not adding new ones; indeed the “Your Freedom” website enthusiastically asks us “which laws and regulations you think we should get rid of”. Yet just as modern Liberals don’t “get” liberty, so the freedom bill has been twisted far beyond its prospectus. Today, the likes of Lynne Featherstone seem to have got their way in ensuring that the freedom to enjoy property has taken yet another knock.

This leads me to a final irony, which is that it will only apply to private land. I find it as odd as the smoking ban applying to private premises but not the street. In this case, there is the obvious question of why it’s OK for local authorities to use clamping and towing away, but not private landowners. Of course, it’s because councils are regulated. That’s right: regulated in, not banned from, using such measures.

In other news, further down the running order, a senior doctor has suggested decriminalising drug use. Manufacturers of barge-poles report a spike in demand.

So What Is A “Social Mobility Czar”?

Does he sell electric buggies until he upsets some lefties and gets taken down to a basement and shot?

Fortunately, as far as I can see, the “Czar” (or should I say “Tsar”) label is an invention of parts the media; Alan Milburn is to be an unpaid adviser to the coalition.

For the record, I’ve nothing against a wish to enhance social mobility and it would be rather cynical of me to suggest that his appointment, far from upsetting lefties, may have the effect of appeasing the left of the Lib Dems.

Now let’s see what he comes up with.