April 2008

30 April 2008
In defence of Shell and BP

Yesterday, the oil giants Shell and BP announced record profits.  One oil industry analyst put it down to high oil prices.  All the oil companies were doing was watching the money roll in.  Which prompted the usual whining about “obscene/outrageous” profits etc. 

I am against this whining as I believe that profits are good1. However, I have to confess that I am a bit stumped to say why bumper profits are so good in this case.  I find it difficult to see where the value has been created.  I suspect that the value was created a few years ago when these oil companies invested heavily in new capacity (although I really have no idea if they did or not).  The profits they are enjoying now is simply the payback for risks they took then.

If so, then they are richly deserved.

Or maybe, actually, they didn’t invest nearly enough which meant that oil demand exceeded oil supply leading to the increase in price.  Sure, that meant that their profits went up but not by as much as they might have done.


1.  See Profit is good or Profits in a Market Economy, Art Carden

29 April 2008
The horrors of legal drugs
Chinatown in London

One of the things my library membership allows me to do is to read old editions of the Times online.  This is fantastic.  I especially like looking through articles from before the First World War.  Things were so different in those days.

One of the ways things were different was that drugs were legal.  Though that was about to change.  In 1912 the Hague Convention (strangely enough opposed by Germany, Austria and Turkey) committed the signatories to banning the opium trade.  This process was halted by the First World War but the leading states re-committed themselves to the ban in the Treaty of Versailles.

The really weird thing was the motivation.  It emphatically does not seem to have been worries about the dangers of opium to the civilian population.  At least, not in the West it wasn’t.  The whole concern seems to have been with China and the prevention of its use there.

This is a point underlined by this article from the 25 November 1913 edition of the Times in which the author tours the opium dens of Limehouse.

We may call these places “dens” for all that they are so clean and orderly and so little withdrawn from public gaze.  We may deplore the injurious physical effects which follow overuse of the drug however small the proportion of cases of definitely traceable injury may be either to the number of smokers or the Chinese population.

...all the “dens” in these two streets together will not furnish from one month’s end to another any such spectacle of “degradation” or rowdyism as may be seen nightly in almost any publichouse.

Not exactly a problem was it?

25 April 2008
LA Conversion: How to win the libertarian argument

Another classic LA pamphlet.  Another classic Brian Micklethwait LA pamphlet in which the author argues that no one ever wins an argument at the first attempt, that it’s far better to be understood than to be agreed with and by implication that intellectual honesty is always the best intellectual policy.



The first rule for winning the libertarian argument is that you must have it.

That sounds fairly obvious, does it not? Yet how many times must we libertarians listen to self-styled “practical” and “realistic” comrades, who tell us that the way to argue for the abolition of income tax or the legalisation of heroin or the abolition of compulsory education is to start these arguments by arguing instead for the lowering of income tax by two per cent, the legalisation of marijuana, and the introduction of education vouchers. The idea is that having bought these mild and diluted versions of libertarianism, people will then be drawn into accepting the more “extreme” manifestations of libertarianism, as if being enticed into the back room of a pornography shop.

The error embodied in this kind of “realism” is the confusion between someone on the one hand being told an idea, and on the other hand agreeing with that idea. These are two absolutely distinct processes, and understanding this distinction is the beginning of wisdom as a libertarian propagandist. There are, to put the same point slightly differently, two ways of being an “extremist”. One consists of not only expressing one’s views with clarity but also of trying to combine this process with that of immediately being agreed with, of saying what you think and of saying why the person you are talking to has no excuse for thinking otherwise. This is obnoxious and counter-productive. Your victim will simply back away, and make a note to seek other conversational companions in the future. The right way to be an extremist is to say what you think and why, while absolutely not assuming that the person you are talking to has any sort of obligation to think likewise, and if anything while making it clear that you rather expect him not to. You think what you think, and he thinks what he thinks. And if he hasn’t told you already what he does think, then an obviously polite next step would be to ask him to talk about that. The two of you can then try to pin down more precisely how you disagree, assuming you do. It is possible to be an extremist without deviating from good manners, and that is how.

Another obvious way to present an “extreme” idea to somebody, in a form which does not grab him by the lapels and shake him around and generally spoil his day, is to present that idea in writing. Publishing is, you could say, a branch of good manners. No matter how “extreme” is the opinion I may read in a pamphlet or magazine, I am never, so to speak, at its mercy. I can stop reading it at any moment, and so in the meantime I need not feel threatened or even discomforted by it. The number one task of the Libertarian Alliance is simply to get the libertarian case spread around - especially in writing of course -to anyone who is interested in it. Whether any particular reader agrees or not doesn’t matter. The point is to spread the ideas.

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21 April 2008
You know things are getting better…

...when even the winos can eat in style:

In the environs of Vauxhall yesterday evening, I noticed two of the local gentlemen of the road, settling down for a picnic on a random street corner near Tescos. And why not enjoy these lengthening evenings, I thought, even if it is still a bit chilly for me to contemplate an al-fresco affair. They had a Tesco bag with them and as I passed I noticed among the usual cans some little round tubs. They weren’t, were they? They were…

Yep, one of them had brought dips. Tesco value, mind you, rather than Tesco’s Finest, but dips all the same. It’s good to know they’re not spending all of it on booze. I’ve always thought that Vauxhall’s tramp population had a certain style…


And three cheers for Tesco.

19 April 2008
The problem with surveys

Some questions to ask next time you see a survey…

Is it measuring what it claims to be measuring?  Usually, there is an input and an output eg number of cigarettes smoked and mortality.  Are both being measured accurately?  Can both be measured accurately?  I heard a report the other day that had claimed to have been able to measure self-esteem in children.  How on earth do you measure that?

Is the thing they are measuring actually as good/bad as the surveyers claim?  For instance if policy initiative X is supposed to have given rise to increase in observable phenomenon Y then is Y as good/bad a thing as the surveyers think it is?  A good example of this, for instance, is museum attendance.  Good, if you like that sort of thing.  Bad, if you’re the seven-year old child who would far rather be playing Nintendo.

Is the sample big enough?  We’re getting into some fairly heavy duty statistics here.  Or, at least we could be, but an awful lot of surveys have pitiful samples.  My rule of thumb is ignore it unless it involves at least 500 people (assuming it’s a people survey).

Is there a control?  Was it done properly?  For instance, one of the earliest smoking surveys pitched a random group of smokers against a group of non-smoking doctors (or so I am told).  Not surprisingly the smokers had shorter lives.

Does correlation prove causation?  If you increase X and observe an increase in Y that does not mean that X causes Y.  Something else might have.  Indeed, Y might cause X.  Look for a time lag.  If X changes and then Y changes maybe there is causation.  Also, look for other likely causes.  Has the survey factored all of these out?

Is it being reported correctly?  Tell tale phrases like “up to” and “as much as” are dead giveaways that the reporters are trying to dramatise things.  Also, is what the report says what was said actually what was said.  Similarly, if the combination of survey and reportage seems to be leading you to a ready-made conclusion (especially one to do with state policy) be very suspicious.  For instance, the other day I heard one claiming that children who wore ethnic dress to school had higher self-esteem.  Conclusion, let Muslim parents foist hajibs on their daughters.  Just a bit too convenient isn’t it?

The most important thing to bear in mind is that scientists don’t always get it right and reporters certainly don’t.  Don’t ever take these things at face value.  It’s also worth bearing in mind that there’s a whole branch of the public relations industry dedicated to raising clients’ profiles and one popular way is by releasing surveys purporting to demonstrate a need for the client’s product or service.

By the way, this is just a list of things that came off the top of my head.  Does anyone out there have some other examples?

16 April 2008
LA Conversion: The Tyranny of the Facts

Yet another classic LA pamphlet rescued from the purgatory of pdf and brought into the sunlight of html.  In “The Tyranny of the Facts” Brian considers how minds are actually made up and how facts are not nearly as important as is normally assumed.

The Tyranny of the Facts
Brian Micklethwait

I was asked a year or two ago by a free market policy institute to do a piece about museums. My commitment to the project was cemented at a free lunch at which Kingsley Amis was also present. The meal was delightful and Kingsley Amis his usual genial self, full of wisdom about The Arts, and about how the Government should stop giving The Arts money.

But as the meal progressed I already began to have misgivings about the project, and these became crystalised in my mind when finally, months later than I had promised, I sat down to write the thing. My problem was that the institute’s boss, Sir Alfred Sherman, had said that I ought to deploy “the facts” about museums. These “facts” were supposed to prove beyond doubt that our collective view of the museums issue was the correct one.

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15 April 2008
"Only one country in the world has eliminated the shortage of transplant kidneys. Only one country in the world has legalized financial payments to kidney donors. That country is Iran." …link
10 April 2008
Who actually benefits from the state?

Now, I am not really interested, here, in the normal response: “Oh, we all do.  It provides, education, health, law enforcement…”  Libertarians know this to be nonsense and there’s no point in rehearsing those arguments here(1).  I am more interested in what we libertarians tend to say:

“Oh well, lots of people: welfare beneficiaries, civil servants, politicians…”

But the point is: do they?

I mean, take Tony Blair.  There he was, Prime Minister for a decade, but was it really worth it?  Sure, you can dwell on the trappings of power: the fame, the central London address, the foreign trips, all those people being nice to you, ruining perfectly decent people just because you can etc, but you’ve also got to remember the hours spent in boring meetings and tramping the streets, having to say things you don’t really believe in and, in the end, the public revulsion.  Oh, and I might add having Gordon Brown as a neighbour.

OK, so what about the ones at the bottom of the food chain - the welfare junkies?  Now sitting on your arse and getting someone else to pay for your housing, food and everything else sounds like a pretty good deal.  But the state extracts its pound of flesh condemning you to a neighbourhood full of chavs with an anti-work culture and a crap local school.  What if there were no state?  Sure you’d have to work for a living but you’d almost certainly end up better off, living in nicer surroundings and with better education options.

Well, if top and bottom are rubbish, what about the middle: the civil servants?  Rubbish pay, good pension.  You might manage to wangle some cushy number with next to no work but you might not.  There are plenty of civil servants who have to work pretty hard.

So, who does win?


1.  But if you would prefer to have those arguments rehearsed see What I believe and Why I am a libertarian.

06 April 2008

Academic, Dan Todman has produced a graph showing cumulative British deaths in the Second World War.  Interesting, if macabre, stuff.