A fine repost to Roy Hattersley

Thank you to one Laura Fox (wherever she may be) for this pithy repost to Roy Hattersley's waffling in The Times:

"An honest intellectual should change his beliefs when confronted with evidences. In a modern social democracy a small but efficient state uses the private sector's taxes to enable access to good education and health for all, delivered via competing private agents.

You, instead, are Old Labour: Reliant on a bloated and self-serving state bureaucracy, that over-tax and exploit the people (directly or indirectly), and provides sub-standard services. The poor suffers the most, as they have no choice but to use state services.

From 1999-2009 the public sector grew by 60%, but our private sector has now shrank back to 1999 levels.

And it was Brown who inflated the bubble. In 2003 he removed housing costs from the inflation index (RPI x CPI), forcing the BoE to keep interest rates too low, for too long, inflating even more the already rising debt/properties bubble to insane levels.

Mervyn King told a parliament committee that he was against that change, and said so to Brown at the time.Source: Lords’ Select Committee on Economic Affairs (24 March 2009, question 481 to 487) http://www.publications.parliament.uk/pa/ld200809/ldselect/ldeconaf/101/9032403.htm

Labour bankrupted Britain, again. And it will always do it, as it will always “believe” in a big state bureaucracy."

Source: September 25, 2009 11:37 AM BST on community.timesonline.co.uk. Recommended by 29 readers.

If the EU doesn't want us why bother staying?

I do wish Johan de Meulemeester (didn’t he play Sgt Wilson in Dad’s Army) could be put in charge of the EU for just one hour - long enough to kick us out of Europe and welcome in the Russians.

My how we’d laugh - we get back our fishing grounds and rid ourselves of the CAP. We’d sign up to free trade agreements with the commonwealth and the remains of EFTA - we side with the Americans on liberty and the pursuit of happiness and leave Germany, Belgium et al as vassal states of the new Russian Empire under his holiness Vlad the Impala (never did know why an African goat was to be so feared but there you have it). Oh well - we can but dream.

By the way - the banks acted perfectly legally and perfectly rationally in light of the prevailing policy, which was flawed not only in terms of Central Banks trying to control the price of money/risk in what should be a free market - but also in terms of the US led policy of extending mortgages to those who could not afford them.

This was the root of the sub-prime crisis and was started under Clinton using the state proxy institutions of Fannie Mae and Mac. Even at the time (1999) this was predicted by the American Enterprise Institute to be a policy for disaster (NY Times - http://query.nytimes.com/gst/fullpage.html?res=9C0DE7DB153EF933A0575AC0A96F958260&scp=16&sq=Subprime&st=nyt).

See also my message to Gordon Brown of March 2009 - http://www.father-ignatius-brown.com/2009/03/message-to-gordon-brown-and-others.html. , and this new book from the Cato Institute - http://www.father-ignatius-brown.com/2009/09/new-book-from-cato-institute.html.

Blessings for freedom, security and no mayo on my chips.

Father Ignatius Brown

http://www.father-ignatius-brown.com/

A beautiful home

Please read this article for a little inspiration:

http://indiefixx.com/2009/09/23/a-peek-inside-indie-home-tours-with-amanda-blake-soule-of-soule-mama/

Blessings for a beautiful home.

Father Ignatius Brown

Common Sense v The Crown

The "Crown Estates" were stolen from the people by fire and sword, paid for with blood and held on to by lies and treachery - the Royals should think themselves lucky that we recovered those estates so peacefully and granted them such comforts as the royal list in return.

It is about time that we made our parliamentary democracy complete. The people are sovereign - our parliament should be the highest legislative body in the land and the executive appointed to do the people's bidding.

As for the royals - they can renounce all claims and titles and join the common people or leave the country and live a life of delusions in some parochial little principality with their sycophantic hangers on.

Blessings for Tom Paine and Common Sense.

Father Ignatius Brown

A priceless piece of princely hypocrisy

Of course 'prince' Charles wants the "people" to give up their cars because cars give freedom and independence to the common people.

Cars are the great democratisers that have lead us away from serfdom. They are more essential to our liberty than socialist transport systems.

This prince strikes me as a typically hypocritical aristocrat who resents the fact that the workers (a strange concept to his type) want the same privileges and luxuries as those born into wealth - yet there is no difference between a prince and the winner of the lottery, both are only blessed by chance not by talent.

Blessings for a republic - soon!

Father Ignatius Brown

http://my.telegraph.co.uk/father-ignatius-brown

PS: Rather than preaching he could try to set an example by selling all his cars for charity and riding a bike to work - three novelties for him to consider!

Infrastructure investment now!

Boris Johnson is quite right about the need for new roads (but not for high speed rail, which is a waste of money) as I have argued in three earlier postings on My Telegraph Blog (http://my.telegraph.co.uk/father-ignatius-brown/blog/cat/motoring) and this blog.

As for the non-jobs, you don't have to sack them - as Will Hutton (he of the Work Foundation) seemed to advocate last week on C4, you could simply come to an agreement with the unions to freeze public sector pay and pensions for 5-years (better than job losses and savage pay cuts).

After all, since so many of them say that their "soft-skilled" jobs are really vocations why should they complain? Simple really - no tribunal, no problem.

Blessings for ruthless efficiency.

Father Ignatius Brown

http://my.telegraph.co.uk/father-ignatius-brown

A national salary for all?

The answer to our current (and future) economic slump is simple. Scrap all unemployment benefits, job seekers allowances, minimum wage legislation, tax credits etc - THEN - let everyone sign up for a taxable national salary.

Every person would be eligible - and could earn as much as they want on top of that wage - it would simply count as part of their taxable income (but would not actually be taxed unless they earned above their personal allowance).

This would in an instant abolish the fear of unemployment - it would allow people to be totally flexible in taking available, temporary work without the stigma and hassle of signing on and off the dole - it would free companies to pay less than the minimum wage, so making them hyper-competitive on the world stage.

This would effectively be a national subsidy to carers, stay at home parents and other. Sure the shirkers would also benefit - but they would have every incentive to earn a bit more on the side without fear of seeing their national salary clawed back. It is also progressive (with an element of equitable wealth redistribution).

This would make the economy more flexible and increase the circulation of money - so providing a support to consumer spending through economic ups and downs - it is in effect the ultimate stabiliser. A free-market solution with a social benefit.

Blessings for inventive ideas.

Father Ignatius Brown
http://www.father-ignatius-brown.com/ and http://my.telegraph.co.uk/father-ignatius-brown

England needs a liberal/conservative alliance to build a fair society

If the hard core lib/dem supporters weren't such red-blooded socialists they might stand a chance of winning over middle England (since some of the leading members of the parliamentary party are genuine liberals) - but as it is they have more in common with old labour than the true liberal traditions of individual freedom, choice, and enterprise.

The conservative leadership are much closer to traditional liberal values (sadly many of the old guard are almost as authoritarian and statist as Gordon Brown) - they are our only hope if we are to reverse our current slow march towards neo-national-socialism (the true liberals in the lib/dems should join Cameron for a liberal/conservative alliance of tolerance, self determination, low taxes and small government).

Blessings for liberty

Father Ignatius Brown

The Chinese asset bubble of 2030

Interesting analysis from James Saft on Reuters - free global markets require free floating exchange rates (and ideally free floating interest rates) - so if he is right about Chinese ambition then his conclusion seems sound.

However, I for one would be interested in James's ideas on how China could manage this without inflating a mega-bubble.

My remedy would be to accept that bubbles occur but set policy so that they pop regularly before they get too big - basically by pumping more uncertainty into the system - ideally through those free floating interest rates and a massive reduction in the ambitions of central planners - by planning for competition not control.

If Greenspan had never launched the Greenspan-put the markets would have been less likely to get carried away for so long. If government policy had not undermined the principles of competition in free and open markets (by pushing Fannie Mae and Freddie Mac to back liar loans) then property prices would not have got so out of hand.

To prevent the mother of all bubbles China must adopt a Hayekian approach to freedom of choice for the individual and a minimum of state interference in economic and social life.

If they want to do something useful with the billions they have saved they should build super high-speed motorways linking all the regions and all the major towns and cities so as to give individuals and trade maximum freedom of movement within the country. Then sit back and let the free market do the rest.

Blessing for liberalism, capitalism and globalisation.

Father Ignatius Brown
http://www.father-ignatius-brown.com/

High speed rail is a blight on democracy.

High speed rail only benefits a small number of privileged people who tend to travel between the two main termini - they are hugely expensive and undemocratic. They embody the totalitarian tendencies of the socialist with their desire to centrally plan all aspects of personal and commercial life.

For the sake of freedom, democracy and greater social mobility we should be building High Speed Motorways (particularly running East/West) linking the regions (not just to London but to each other).

The car is the great democratiser of the 20th century - by all means make them greener, cleaner and faster but don't demonise them.

Road building has shamefully lagged car growth for the last 50 years - that is why we have congestion. Yet road transport is far more efficient than rail in that everyone has the power to choose their own speed and destination rather than being beholden to a state backed monopoly (as Hayek pointed out - this is the very worst sort of monopoly).

Blessing for individual freedom and bigger, faster, longer roads.

Father Ignatius Brown
http://www.father-ignatius-brown.com/

New book from the Cato Institute

Have just received details on a new book from the Cato Institute that some readers of this blog may find interesting (though that is not a product recomendation only an observation). I haven't read it yet so cannot offer any personal view - if you read it please feel free to post your reviews below.

The Cato Institute describe the book as follows:

Financial Fiasco:

How America's Infatuation with Homeownership and Easy Money Created the Economic Crisis

By Johan Norberg.

JEFFREY MIRON, from Harvard University reportedly says that it is: "Essential reading for everyone who cares about our economic future, but especially for those who are still not sure what caused the crisis. As Norberg makes clear, private forces jumped willingly on a runaway train, but it was government that built the train and drove it off a cliff."

Writing in his new book, Mr Norberg reportedly says: "The story of this storm in the global markets is the story of how government intervention to solve previous crises laid the foundation for a new one."

Tracing the causes of our current financial crisis with liveliness and clarity, Financial Fiasco shows the mistakes made in Washington, on Wall Street, and in communities across America that led to the economic meltdown. While many analysts have placed the blame solely on Wall Street, Norberg exposes the crucial role government regulation played in creating the opportunities and incentives that led to the financial collapse.

In six concise chapters, Financial Fiasco tells the complex story of the crisis, showing how monetary policy, housing policy, and financial innovations combined to create financial catastrophe. The final two chapters describe the government's mismanagement of the crisis and how we are now dangerously repeating many of the very same mistakes that caused it. An understanding of the roots of the financial crisis is crucial for [everyone] who has felt its effects - and would like to prevent the same disaster from happening again. Financial Fiasco provides that understanding, with great insight, clarity, and wit.

Equally important, Financial Fiasco serves as a profound warning against pursuing the wrong solutions. "After government authorities had helped create the worst financial crisis in generations, the climate of ideas has now shifted dramatically in the direction of bigger and more active government," Norberg writes. Financial Fiasco is the perfect antidote to those ideas, a cautionary tale on how to stop confusing the disease with the cure.

According to AMITY SHLAES, on the Council on Foreign Relations: "Johan Norberg exposes the abiding hypocrisies of policy that generated this crisis. A masterwork in miniature."

About the Author

JOHAN NORBERG is a senior fellow at the Cato Institute. His previous book, In Defense of Global Capitalism, has been published in more than 20 countries. He wrote and hosted "Globalisation Is Good," a documentary for Channel Four in Britain. He lives in Stockholm.

Fight for the right to the freedom of Education Otherwise

Brilliant article from Caitlin Moran - but be warned Home Educators - you are up against the centralising instincts of the socialists - socialists have a complete disregard for liberty and individual freedom because it threatens the organs of state including state organised education (through which they can pump their socialist propaganda).

Education otherwise is the only form of education that recognises the value of the individual over the group. It recognises that society is not the same as THE STATE and it recognises that society is a product of individual free choice not a separate imposed order.

That, sadly for home educators, is completely at odds with the aims and ambitions of socialists in general and this Labour government in particular, which thinks it has a god-given right to meddle in every aspect of our personal life for the sake of "the greater good" and "social order".

Sadly for this country, socialism is the fastest route to the totalitarianism of national-socialism yet invented (with half our productive economic capacity nationalised in all but name we are half way there already).

Blessings for freedom and education otherwise,

Father Ignatius Brown

http://www.father-ignatius-brown.com/

Now is A GREAT TIME TO SELL your house

This is A GREAT TIME TO SELL for anyone looking to trade up - in fact it is probably the best time they will ever see unless prices fall a lot further (when they might not be able to sell because of negative equity).

Why is it such A GREAT TIME TO SELL? - Because the difference in price between different standards of house (one level and the and the next level up) is at its narrowest for 15 years. If they wait for the value of their house to increase they will find that the move up becomes even harder, if not impossible.

Now is also A GREAT TIME TO SELL because there is enough buoyancy in the market to prevent most people from attempts at gazumping and gazundering.

Now is a great time to sell because there are still cash buyers around looking/needing to move who are willing to move fast and don't need to mess with the mortgage brokers.

So the message today is "SELL NOW BEFORE IT'S TOO LATE!"

Blessings for a fast sale.
Father Ignatius Brown
www.father-ignatius-brown.com

Don't write off the free market yet - we need to first give it a try!

I take issue with Roger Bootle who seems to argue that the collapse of Lehman Brothers somehow put paid to the free market.

They should never have bailed out LTCM - or cut base rates to support the market in 1987 and 2001 - or allowed any bank or financial institution to become so big.

They should never have used Fannie Mae and Mac to extended liar loans to people who could not pay.

They should never, ever have messed with the price of money - because that is messing with the price of risk - and when that happens you get a gross mis-allocation of resources that leads to asset price bubbles.

We need more risk in the system not less. We need floating currencies and floating interest rates. We need to get away from this socialist idea that the state can prevent busts yet deliver perpetual booms.

We need more volatility to keep the market on its toes - rather than lulling people into a false sense of security that leaves them shocked when the inevitable crisis hits. (Better to deal with rolling hills than miles of fens followed by jagged mountains.)

Banks need to be smaller and leaner. Markets need to be more transparent and efficient - that means less government interference not more.

Blessings for an end to moderation and meddling.

Father Ignatius Brown

http://www.father-ignatius-brown.com/

Protest is useless - sanity is over rated - recovery is an illusion.

Another good article Mr Randall - but sadly you may as well give up.

The political classes are not listening; they have found their magic escape route - through to the looking-glass world of neo-Keynesian-socialism.

The public are either supine in state non-employment or on state handouts; or stupefied by debts, taxes and the fear of unemployment; or subjugated by ever intrusive laws and regulations (fearing the state, with its bureaucrats and police more than common criminals).

Sound economics is dismissed as if it is an axiom that living within one's means is unbearable, that freeing the markets to allocate resources effectively is impossible, and that fiddling with the price of money and distorting the price of risk is somehow prudent and sustainable.

Ginger and Pickles learnt the hard way that you cannot survive on credit and hard-tack biscuits; but like Ginger we may end up eating rats before we learn the same lesson.

Blessings for honesty, frugality and freedom.

Father Ignatius Brown

www.Father-ignatius-brown.com

Can house prices really be recovering?

Sad to say that house prices probably are on the up - in fact (as with the stock market) it looks like we are at the start of another cheap money induced bubble - which will pop most painfully in a year or two as taxes and interest rates rise and state spending slows (and unemployment keeps rising because the hot money flowing into the country will keep wages uncompetitive with the outside world).

This is what happens when you let socialists run economic policy and mess with free markets and the price of money - it leads to a mispricing of risk and a gross misallocation of resources.
The asset price rises are just the hidden inflation caused by QE - they don't affect the headline rate and so policymakers feel they can ignore them.

The trouble is, the prudent have no option but to join in the madness since if they merely try to sit tight and save their money they will see its value eaten away by that inflation. We are on a carousel you either cling tight or try to jump off while it is moving and hope you don't suffer anything worse than a bruised knee and ego.

You will need to keep working until they cart you off to the LCP ward.

Blessings for a happier life.

Father Ignatius Brown

www.father-ignatius-brown.com