The next 50 years

My economic theory — to be published on this blog-site soon — has some strong implications about the next 50 years or so. The main one is that the total manufacturing output of the world wll be roughly the same as it is now/ It may slide a little due to the automatic gain in energy efficiency — the Law of Least Effort — or it may gain somewhat as China finally sells consumer goods to the remaining middle-class markets dotted around the world.

What about some individual countries? China will continue to develop until its economy stabilises at an average middle-class standard of living. American and his country will continue to grow modestly as they both feel their way into the new post-industrial era. Germany will continue to do well until China starts building its own more sophisticated engineering goods which it presently imports from Germany.

What about the rest? This is mainly about 180 undeveloped countries. These will be joined by about a dozen that aspire to be developed but will fail and about a dozen more that are already advanced but will also subsequently fail.

The standard of living of the people of all these countries will gradually increase until they learn to steeply reduce their birth-rates. Some of them could do very well indeed if they are able to develop specialised ecological tourist sites for advanced world holiday makers.

Addendum to previous blog

What I forgot to add to my previous blog is that, once the monster high street banks were split into smaller regional and city groups, each group should then be treated as a separate business, subject to company law — as they were in this country in the 19th century. This means that, at a time of a financial crisis, the incipient collapse of the whole system as in 2008 is not threatened. Instead, a much smaller numbers of banks — perhaps only individual ones in some cases — would be forced into bankruptcy and doesn’t seriously shock the whole national or world economy as 2008 did.

Let’s continue to reform banking

High street banks are finding it increasingly tough going so we are informed in today’s papers. One of the reasons is that the bank regulators in all the advanced countries are forcing banks to raise their reserves ratios from about 0% (as in 2008) to 8% (pre-2008 requirement) and through further to 12 – 15%. Before the 1914-18 war, most banks had reserves between about 15% and 30% of their liabilities [credit issued] and some even higher. Regulators might want to re-adopt these ratios in the years to come.

Besides this, the other highly desirable reform that was much talked about in the early years of the 2008 Crisis, but neglected now, is to split up over-large-banks into regional or city-based ones — as they were before the 1914-18 war. If this had been in place in 2008 the Crisis would never have developed so rapidly.

The necessity of social status

The Darwinian and Wallacian principle that the fittest of every generation tend to survive and have fit offspring over the longer term compared with the weakest of the generation is sill important. However, it has been more recently realized that evolution can much more quickly adjust to changing circumstances in the environment — which includes the economy as well as the natural environment.

This is achieved by sexual selection in addition to general selection. By this, the females of a species, including ourselves, choose males from as high up the ability range as possible as being more likely to be a dependable father to her children. Social status, generally, is a good guide to this natural quality control of our genes from generation to generation.

Also, all social species need clear individual leadership. This is most efficiently achieved by the emergence of a single person at the most senior social level in every organisation — political, business or religious. This usually occurs after years of a mutual sifting process throughout boyhood, adolescence and young adulthood.


The income and wealth differential (I&W) between Chinese Emperor Qin in 200BC and the farm worker of his time was probably several million to one. The I&W of an English aristocrat and his farm worker of the 18th century was probably of the order of 5,000 to 1 — that of a Victorian industrialist and a steel worker probably about 1,000 to 1 — that of the CEO of a modern major corporation to its lowest employees prior to the 2008 Crisis about 150 to 1.

Since the 2008 Crisis, the I&W has been declining and, without the crisis, would probably now be of the order of about 20 to 1 — roughly what is now the I&W between the head of the civil service and the lowest paid clerk. If another monetary crisis came along then a countrywide I&W of no more than 20 to 1 would have to be imposed by the government to prevent social breakdown.

Optimism — right or wrong?

According to the poet, C. S. Lewis, each one of us “contains a zoo of lusts, a bedlam of ambitions, a nursery of fears, a harem of fondled hatreds” and predicts what will happen when millions of these messy bundles of contradictory neuroses bump up against one another in society.”

Lewis’s “neuroses” are, in fact. automatic instincts that are individually provoked by specific circumstances. All of these are laid down in ‘old brain’ deep in our heads long before our rational frontal lobes evolved. One important product of the latter, only recently discovered by biological science, includes the notion of ‘fair play’ or justice. Although this is a ‘still small voice’ most of the time, it is permanent — always with us — and can, increasingly with experience, overcome an instinct that may become disruptive. As historians generally report, and despite any current gloom, mankind is gradually becoming more peaceful as time goes on.

No choice for 180 countries

All our bodily perceptions of the outside world were catered for a very long time ago by leaders of hunter-gatherer groups, or by emperors and kings or by the aristocracy or by most ordinary folk since the full playing out of the industrial revolution — approximately 1780s to the 1980s. Since then, there have been no uniquely new consumer goods. There have been hundreds of thousands of derivative consumer goods and also many improvements.

However, in recent decades it has been the case that all improvements of relatively high market value have been the products of deep scientific research — whether intentional or serendipitous. In terms of Nobel prizes, almost all this research is carried out by no more than half a dozen governments and major multinational corporations. As the trading of consumer goods is the largest component of financial activity this means the 180 countries in the world will be confined to importing and exporting low value goods and thus permanently excluded from raising their living standard until they’ve reduced their populations enormously — by 2200AD perhaps?

Surprise, Surprise!

To my great surprise, I’ve actually been in hospital for over a month. Considering that governments, central banks, high street banks, the financial sector generally and, of course, the large mass of economists around the world are still in a state of almost complete befuddlement as to the condition we’re in and where we’re going.  If you’ll forgive my trumpet blowing, the present condition and very possibly the next 20 to 30 years is almost en passant. when diagnosed by my theory.  But more later in a week or two.

Why no new posts

Greetings. This post is not by Keith. I am Atanu.

I wondered why there have been no posts from Keith since Sept 17th. So I wrote to his daughter, Sue, and she replied that he’s in the hospital. He will be back home as soon as they can arrange full-time care at home.

Here’s wishing Keith all the best.


The bad turning we made

The problem with those who’d like to see economic growth sweep over the whole world and bring every country up to the standard of living of the half-dozen First World countries is that they then cannot plausibly explain just how it could be done.

Considering that there are several hundred thousand professors and graduate economists in academe, government and central banks and that they’ve had six years to think about it since the 2008 Crash then it’s a pretty poor show.

In their text books, economists can easily show just what happened in 1780 when immense profits were made from factory spinning cotton bolls into thread and then, three decade later into factory woven cloth for all countries — especially the warm and humid ones south of our latitudes — even down to scattered groups of hitherto naked hunter-gatherer groups who became ashamed when visited by white merchants.

All this yielded further vast investments for further technologies in iron and steel that rounded off the total unique experiment in the whole of human history — the astonishing phenomenon that we call the industrial revolution, 1780 to 1980.

The industrial revolution ended in 1980 in effect when the ordinary consumer in the originating countries in the no longer continued to save hard in order to buy the next desirable status object by increasingly relied on the credit card and the increasingly undisciplined habit of banks in issuing credit

Japan and  China had carried out excellent copy jobs of the English industrial revolution in 1880 and 1980 respectively but they were — and still are — also relatively poor in creating new technologies of thei own  and are content to coast along on what Germany, France, the Netherlands, England have developed America had already developed.

And there is also another huge phenomenon that also took please during the 1780 to 1980 industrial revolution. Just as the production of goods expanded a thousand-fold or more during that period so also the geology of the earth was also accidentally able to supply the necessary energy inputs.

From whale oil and wood to coal mining — and then vast new acreages of hitherto unexpected deep-mined coal — to oil production in the Middle East and finally to immense quantities of natural gas that had previously gone to waste.

Without all this commensurate supply of vast quantities of energy rising in leaps from year to year, the industrial revolution would have played itself out by about 1820 or 1830 at the most.  Modest amounts of cotton would have continued to be imported but more than adequately taken up by hand-spinners and hand-weavers in cottages all over he country.  Nothing by way of industrialisation would have been needed — nor any sort of progression to deep-mined coal, iron and steel production or the railways.

It is was the unique relationship between the rapidly expanding supply of cotton products in England and the availability if energy at every stage it was needed that was the coincidence that could, in theory, have occurred many times before in Persian, Indian, Chinese, Islamic, etc Empires.

All these had sufficient technology behind them — the Bronze Age and the Iron Age as well as spinning and weaving many products.  But why did they not catch on to automated production in factories?  It was the lack of the coincidence mentioned above and which became concentrated in Liverpool Port and surrounding towns.

For the 6 billion people who don’t have the standard of living of the dozen or so advanced countries there is no way that any group or region of them can find a product that is unique enough to sell widely across the world nor can they lay their hands on a vast new energy source that they would also need.

The long and the short of it all is that we made a bad turning from hunter-gathering to agriculture — and that must be rectified over the next two or three hundred years before the huge disparities between the rich and the poor can be reduced.

The Law of East Effort is coming about — even if unwittingly

I normally have quite a lot of time for Jeremy Warner, the economic journalist who writes for the Daily Telegraph but when his headline is “It’s finally safe to say that the great crisis is over” it depends on what he means by “great crisis”. If he means the great crisis is over for this country — and America — then I’d agree with him that we might have economic growth — albeit modest levels — for some years yet.

If he’s implying that the world’s low pace of economic growth is now finally over and that we’ll now see a steady resumption to full scale growth as it was in the 1990s — say about 4% per annum — and way beyond permanently, I think he’d then be wrong.

There’ll be room for this for a decade or two but little longer as China finally draws in its final tranche of 500 million rural Chinese into its ‘ghost’ cities and adds their exports to those remaining importing pockets of opportunity — the rich and upper-fifth of Second and Third world countries.

In the case of America and England, we’ll be sharing in this modest prosperity by importing replacement or improved items of consumer goods from China in exchange for highly sophisticated services — education, health, law as well as design in fashion, architectural, infrastructure and engineering.

What applies the kybosh to any sort of growth economics as is still not talked about today.  It is that you don’t get massive additions to economic output without massive additions to energy inputs — such as we certainly had during the industrial revolution itself 1780 to 1980. None of the world energy companies will ever get into discovery mode again unless the prices of oil, gas and coal is very much higher then now and guaranteed to stay there.

And, besides, energy conservation in building construction and in equipment use has never been better than now in First World countries. The Law of Least Effort — as abstract and impossible to understand as any other law in physics — is now coming about unwittingly in men’s minds.

Sack the schools and start the streaming!

One of the arguments — a very strong one — against the revival of grammar schools in this country is that if they select bright children as the result of a test at 11 then they necessarily deprive other local secondary schools of the best students.  The bulk of those who are not selected are therefore given a second class label which can easily cast a spell for the rest of their lives.

Theresa May’s government had already armed themselves with an answer to that by saying that children will be also able to transfer on the basis of several other tests taken up to the age of 14 or so.  In this way those who are late developers can be catered for.  Also, those who happened to have had a bad day when taking the original test will have at least one more chance — perhaps two or three — to escape to the better school.

But this, on reflection, also implicates a reverse fault of tests.  Although tests have a precise selection mark, the sort of intelligence and all-round abilities that are really being looked for are rather more hazy above and below the cut-off point.  In short, just as there are a few children who ought not to have been rejected after their first test so there are children who were selected when, as it turns out during later performance, they should not have been.

The result of this is that a grammar school that selects at 11 and is subsequently fed with good new entrants between 11 and 14 will also be accumulating some original takers who will bring the average performance down from then onwards.

Both problems can be avoided by streaming. After an all round experience in junior schools why shouldn’t every student then be graded in each subject?  Instead of meeting in one class every day of the week, a student might well meet in several different classes in the course of a week.  Too complex to organise?   Not these days surely, with very large secondary schools and a school administration having access ro supercomputers to print workable timetables.

Though the timetable wouldn’t be complex at the teacher level.  One teacher might have three classes in his subject, one class just starting off, one half-way through the syllabus and another at pre-university level. All the classes, however, will have students at different ages, some who have dropped back and taking the subject remedially, others who are brilliant even though years younger than the average in that class.

Teaching and learning will become more like mentoring and something like this is probably already developing in an increasingly specialised era..  We hear stories increasingly of more precocious children than ever before forging years ahead of paid professional people many years older.  Maybe our educational shibboleth should be “Sack the schools.  Start the streaming.”

Kids jumping grades

Now that Theresa May’s command for grammar schools has erupted into intense controversy — as much in Tory ranks as in the Labour Party — where you might expect it the more — another recent blog needs a revisit.

This is “What to do for gifted children” (11 September).  In particular the following passage: “. . . educationalists should not be afraid of accelerating the grades of exceptional children. So long as they find themselves in a group of older students where they can talk about their special subject the children will socialise well enough.”

The accent should have been on the subject, not necessarily on the whole curriculum.  For example, if a 12 year-old has a fascination for physics then let him or her jump grade in that subject.  Even if the child joined some 18 year-olds studying physics for their university entrance exam there’d be no question of bullying or lack of socialisation.

If, however, the same child joined the same class of 18 year-olds permanently in a full curriculum of subjects then all sorts of developmental disparities would be apparent simply to do with age.  Steve Kurtz makes the point in his comment.

When will we see the real Theresa May?

If politics — in big government and big business — means anything at all it is about personality and its interplay.  Forget rationality or intelligence or even forcefulness, they may be add-ons but not necessarily required.  What is, is the mix of ‘personal chemistry’ (and literally so so if pheromones are further implicated in scientific investigations).

So it is already being proved to be so with the accession of Theresa May to 10 Downing Street and her reversals to, or postponements of, at least three issues already — the Hinkley Point nuclear reactor, grammar schools and the chief appointment to the BBC Trust.  They were all more or less personal decisions of David Cameron.  It’s no wonder that he’s now decided to get out of politics altogether.  There might be a long stream of further embarrassments to come had he remained in the House of Commons.

I would seem that she didn’t think too highly of Cameron when he was prime minister.  She would have known him far better we did in the outback.  But how did we view him?  Well . . . even with a degree from Oxford University he didn’t seem to be at all well-read.  When asked on an American chat show about the Magna Carta, one of this country’s primary historical documents, he evidently didn’t know what it was about.

Cameron was bright enough to pass muster in the schoolboy slanging match that often go on in Wednesday’s Prime Minister’s Question Time in the House of Commons.  But, of course, he was just the stooge to his best friend, the real prime minister, George Osborne. The latter was definitely a politician who read widely and followed all the latest fashions in economics and management theory.

It will be fascinating to hear of further Cameron clear-ups in the coming weeks.  We’ll then see whether Theresa May has something of herself to show us.

Whoah! Let’s go slow on cannabis

Following hard on my blog of yesterday, “Stepping it out with cannabis”, and in support of Steve Kurtz’s more restrained view in his comment, there comes news today in ScienceDaily that one of the psychoactive substances (THC) found inside cannabis definitely causes lesions in brain circuits — a world first discovery.

In their desire to get the news out before its formal publication, Professor Fumitaka Kimura and his research team at the Department of Molecular Neuroscience, Osaka University in the hope that this will decrease the use of marijuana.

The demand that isn’t working

Some say that the industrial revolution of around 1780 didn’t need any of the Western Enlightenment that historians say was broadly shining all around in many people’s minds at that time.

Let’s face it, the first factory cotton spinning machine was got together by a carpenter who knew little mathematics and even less engineering science.  But let’s pause — there were probably a quarter of a million carpenters in England, Wales and Scotland at that time and everal million living in Europe.

Contemporaneously, there must have been several million single spinning wheels in cottages all round Europe ever since relatively small amount of surplus cotton from India had been imported every year for several generations beforehand.

If innovation is some sort of statistical fluke, then one might have thought that there to have been hundreds of two- or three- or four-wheel spinning machines to have been invented and at least being experimented with all round Europe, including England.

After all, a largely unfulfilled consumer demand was there already — a very small middle-class (for example, yeoman farmers’ wives in this country) was slowly rising all over Europe.  They were desperate for a beautifully woven cloth for summer wear that was equivalent to silk — the apparel of the aristocracy they yearned to imitate but couldn’t afford to buy.

This is where J. M. Keynes and most of today’s neo-Keynesian economists have got it wrong.  They think that consumer demand is all-important.  It isn’t.  The supply has got to be there in sufficient numbers for there to be a market in the first place.

But it was not there in 1700s England even though, probably, a quarter of a million poor women were working at their spinning wheels for pin money whenever they had some spare time from their children and household — or smallholding — chores.

It all changed when large quantities of raw cotton quite quickly became imported through (mainly) Liverpool docks from large slave labour plantations in the West Indies and America.  Suddenly the need to be able to spin cotton into fine thread in large quantities became apparent.

Invention is the Mother of Necessity.  Soon, a six-wheel spinning machine was devised, requiring only one operator instead of six, then an eight- . . . and so on. It only required one unknown carpenter — no doubt brilliant in all sorts of ways also — to have got the ball rolling.  The supply could suddenly all be made apparent.

Was the industrial revolution purely a by-product of the need to supply?  It looks like it, but perhaps not exclusively so because there was also a great feeling of independence and release around at the time.  Aristocrats were going on Grand Tours around Europe bringing back works of art and books and ideas which were eye- and mind-openers.

The Royal Society of intellectuals with outsize curiosity was founded a century before. A new feeling was being epigenetically bred into the culture of England — and also the Low countries and Germany — all on a narrow northern coastal strip of Europe.

Whether the one carpenter who built the first automated spinning machine was impelled by an economist’s  ‘supply factor’ or a personal need for enlightenment — or a mixture of both — does not really matter.  It certainly wasn’t demand — the item spelled in large numbers by modern economists.  It just wasn’t available then.  Demand only become fully apparent when an abundance of supply could be established first.  There’s already more than enough of demand-only type of thinking in today’s advanced countries and it’s plainly not working.

Stepping it out with cannabis

If the time hasn’t been ripe for the legalisation of all hard drugs, it has surely arrived for cannabis alone as it’s beng considered again by a cross-party group of British MPs

It says that if tens of thousands of people in the country — otherwise not among social recidavists — already quietly — desperately — break the law to use the drug for relief from long term back pain, chronic anxiety and a dozen other painful symptoms, then there’s surely a case to be made. The drug should be reclassified so that doctors could prescribe it, chemist shops dispense it and individuals grow it for their own use.

The All Party Parliamentary Group took evidence from over 600 patients, representatives of the medical professions and people with knowledge of how medical cannabis was regulated — or completely unregulated — across the world. It has benefits against a wide range of diseases.

Still hard against this is the Home Office view which says there are issues of dependency and a possible link with schizophrenia in some long-term users.

Eleven European countries, Canada, Israel and half of the American states already allow medical use of cannabis. That’s surely sufficient experience on which we can reasonably safely take the next step forward.

Back to hunter-gathering

Quite the most astonishing phenomenon of the internet age is the sheer number of people who commute to work every day and then spend the most of their working time — isolated — behind a keyboard and screen.  Twenty years ago, BT, then beginning to dabble in these matters, reckoned that there were a million and a half people who worked at home and forecasted that the number would grow every year until many millions were doing so.  That’s the future in which BT obviously wanted to engage in.

Well, this just hasn’t happened.  True — many more people, millions even, work from home these days.  There are writers and all sorts of independent users of personal computers and in recent years there’s been an accession of a million or two who make a living directly from the internet and there have been employers who’ve done what Dr BT told them — getting their staff to work from home and thus saving on the purchase or the lease of expensive offices in town.

Nevertheless, the gap between those who could quite easily work from home and those who continue to commute is still very large.  The reason is obvious to anybody who knows the teeniest bit about the origins of early man or who have the slightest psychiatric knowledge of individuals who are running off the rails.

We have a profound need for company.  This is not to say that all those who work form home alone are likely to lose their wits.  Most will have family appearing at different times in the day and those who haven’t will normally have a social life outside their working hours.  There are very few people indeed who voluntarily spend all their time alone, week in and week out.  When they exist, neighbours usually have good sense to be cautious about them.

But, in any case, it would seem that the jobs structure of the world into which we are heading — highly professionalised, refined jobs — will require the stimulation of new ideas as never before in our job history and where better than in groups?  The number favoured fairly widely by anthropologists (the Dunbar number) is of about 80 to 120 individuals for maximum efficiency and mutual kindnesses.

This number is of all age levels — that is, with about a dozen mature adults in the driving seat, with either the retiring old or the aspiring youngsters and children scattered around them.  In a curious way we have gone full circle from the hunter-gatherer group where our instincts and perceptual abilities were honed for millions of years to today’s scientific research group or managerial group in business.

The inevitable euro-crash

The EU faces three imminent problems. One is the lack of an immigration policy that’s agreed by all members. Another is how it will adjust to the departure of one of its Big Three economies — Britain — from its ranks.

The third one — of longer standing and by far the most intractable — is the euro. In particular it is too expensive for Greece to be able to export anything other than a few premium products to the rest of the world, and thereby reduce its national debt.

The International Monetary Fund (IMF) — exceeding its legal powers three years ago — helped to bail out Greece when its debt was around 140% of GDP. It is now 170% and continuing to rise. At present, the IMF have refused another bailout. Germany, the only really prosperous country in the eurozone — apart from the Netherlands — and the only one capable of giving a adequate loan also refuses to do so.

All this comes up in the next few weeks. Maybe — in some unimaginable way — the can will be kicked down the road again for another year or two. But it’s only a matter of time before the inevitable euro-crash occurs — very possibly tripping off the much greater anomaly of the enormous concurrent imbalances of the US dollar around the world.

What to do for gifted children

A four-page article in this week’s issue of the world’s top scientific journal, Nature, about how the number of brilliant scientists may be increased in the course of this century is worth paying attention to.

It is “A long-running investigation of exceptional children reveals what it takes to produce the scientists who will lead the twenty-first century” and written by Tom Clynes.

The particular investigation it refer to is the Study of Mathematically Precocious Youth (SMPY) which was started by Julian Stanley 45 years ago and continues to this day as the longest-running current longitudinal survey of intellectually talented children. It has tracked the careers and accomplishments of some 5,000 individuals since their childhood.

Stanley chose them by giving them a Scholastic Ability Test (SAT) — often several years before they are normally taken by university aspirants.  If they appeared in the top 1% of overall results then they became part of the study whatever their age.

Combining the results of SMPY with 11 more longitudinal studies of other research teams they all confirm that precocious children certainly do have a effect on society when they reach mature years.  Other provisional results so far that education boards in different authorities might bear in mind are as follows.

SAT and 11+ type tests fairly accurately denote the high flyers and, within them, spatial ability questions are the strongest signifiers.

Excessively low or high scores can be false indicators on any particular day. Tests should be repeated.

Exceptionally gifted children are not ‘loners’. They all look for personal encouragement and a social setting of like minded individuals.

Theories such as 5,000 (extra) hours of tuition which are supposed to take ‘ordinary’ children and young people into the highest realms of expertise — or even genius — as claimed by some, might or might not be relevant for some, but not necessary for the naturally gifted.

For the above reason, educationalists should not be afraid of accelerating the grades of exceptional children. So long as they find themselves in a group of older students where they can talk about their special subject the children will socialise well enough.

The successor to our National Health Service

Adequate week-end provision of accident and emergency care all over the country is “impossible” to achieve — never mind acute procedures during the week — according to the chief executive of National Health Service (NHS) Providers. Current funding levels are inadequate.

As the NHS continues to crumble under the weight of growing popular demand, some sort of personal insurance-based system will have to replace it sooner or later. This is just as it was in my (working class) boyhood when I was diagnosed at home with advanced appendicitis by the local GP and was operated on within three hours in one of the two partially charity hospitals in my home town — years before the NHS came into existence.

The big difference between now and then, however, is that medical science has developed apace. Medics are now able to treat 20 or 30 times the numbers and types of diseases. We also depend on at least a dozen new medical specialisations working between and beyond the physicians and surgeons of the 1950s. This time, when we evolve to NHS’s replacement, there will need to be many more numbers of specialists than now.

The numbers of students wanting to enter these new medical professions is patent. What therefore will also have to be done is for the government to withdraw the closed-shop (trade union) privileges of the Royal Colleges of Medicine and allow an open market of training to develop. How long this will take is anybody’s guess. Perhaps it will only some about as a result of a greater catastrophe — a monetary one more than likely.

Differences with the EU will be relatively trivial

According to “senior EU officials” this country will be pleading for a deal when we invoke Article 50 and start negotiations to leave the EU. But that’s only a rumour. We don’t know what they’re really thinking among themselves.

As likely as not it, will be really tough for us in the early months because they have teams of experienced negotiators who’ve been battling it out with American civil servants during the negotiations of the Transatlantic Trade and Investment Partnership (TTIP) in the last five years.

At present we don’t have anywhere near the numbers of high level civil servants with the requisite experience but they’re being recruited, mainly from Canada and Australia. The former have a great deal of experience in negotiating the North America Free Trade Area (NAFTA), and the latter in many years of trade deals with China.

No, it won’t be us pleading with the EU when we start negotiations. It’s more likely the EU will be pleading with us because we import a great deal of the products and services of EU — even more than the high level of exports we send to the EU.

Businesses on both sides — and particularly businesses within the EU — will be very angry indeed if Britain is ‘penalised’ in any way that will affect existing levels of trade more then trivially.

Accepting the nuclear bomb

The Japanese are in a fury about the latest nuclear bomb test in North Korea. As well they might. The cultural memory of the cruelties of the Japanese during their invasion of the eastern seaboard of Asia from 1910 through to the end of the Second World War in 1945 is still strong in the minds of many Manchurians, Koreans, Chinese and inhabitants of other south-east Asian countries. But it’s only the North Koreans where the hatred of Japan is still constantly referred to.

Japan is also the direction in which North Korea persists in firing its short and medium range test rockets. Now that it has developed its nuclear bomb — supposedly now more powerful than the Hiroshima bomb — it won’t be long before it could, hypothetically, destroy Japan. Japan could do little about it, not having a navy — not at least until starting on one very recently — or a nuclear weapon of its own.

But a nuclear missile fired at Japan would never happen, of course. Or, rather, if it did, then China, Russia or America or perhaps all three of them in association would instantly drop another one on Pyongyang and wipe out Kim Jong-un’s government and, indeed, the existence of North Korea as an independent nation-state.

North Korean politicians would know this. This is why nothing serious will ever be attempted.   By all means send a warning note to North Korea, but otherwise not to get excited about it. There are far more dangerous nuclear possibilities in the world than North Korea — Pakistan versus India, for example, or Iran versus Saudi Arabia.  A watching brief over North Korea is all that will be necessary. North Koreans are extremely clever people, given enough time and de facto recognition that they have ‘arrived’ as a nation then there’s a good chance that it will mature into a better-balanced country.

A more important priority for education

Theresa May, in her announcement about a dramatic change in education policy, still hasn’t got to the nub of it. This is that, for 30 or 40 years now, neuroscientists have been revealing to us that by far the most important changes that take place in the brain — and its consequent ability to absorb knowledge — occur in the earliest weeks, months and years of a child’s life.

That’s where additional educational resources should now be spent — parenting classes for young mothers, superb child care and nursery schools for all children, and junior schools as good as any of the best private prep schools. Let potential abilities be discovered early in a child’s life and let them develop at individual children’s own speed.

All this is what should be developed soonest. Further refinements about selection, exams, types of secondary schools and so on can be postponed for a few years. In fact, many arguments on these quasi-theological niceties will disappear in due course when the full strength of genetic ability and better adult guidance starts coming through in larger numbers of highly talented students entering universities..

Head-banging in both left and right political parties

In a comment to my piece “The adjusting economy” yesterday, Arthur Cordell writes; “How do we get income to those who can no longer find a job? It will have to be done. Do we wait until the society fractures and there is ‘blood in the streets?’ ”

I suggest that it won’t be ‘blood in the streets’ — at least not spilled by the poor. Most demonstrations in the streets are due to angry young people — but they’re only incidentally poor. Most — at least so far — have jobs in due course. Demonstrations in the streets that are potentially dangerous to governments are not by poor people but middle-class ones.

This is why the Labour government tried every which way to prevent the Anti-Iraq-Invasion protest from being held in Hyde Park in 2003. The Rose Revolution in Georgia, also in 2003, was where middle-class people simply walked into government offices and peaceably took them over. The great Peasants Revolt of 1381 in this country which almost took over the government was not of poor peasants but a well-armed prosperous segment of them.

The poor — that is, the genuinely poor by accident or job redundancy or age or illness, not the free-loaders or the irresponsible — are usually isolated and disorganised and also ignored by workers’ trade unions.   Arthur goes on to say “Surely this is can be solved. Takes some leadership”.

Poverty can’t be solved. In every society since civilisation and he use of money began, rich and poor have existed in every country, region, culture or district. We are all born with genetic differences from one another and our differences are further refined by early upbringing. We are, as much as we are a social species, also a rank-ordered species according to our individual abilities.

If only socialist politicians would realise this then there would be less talk of how to extinguish poverty — or even to lessen the numbers of the poor — and more of how do we diminish the large income differences between the social elite and the poor.

If only right-wing politicians — who agree that we are a hierarchical society almost axiomatically — would realise that too many potentially talented individuals at birth are subsequently blunted by poor parentage and subpar schools.

It will, indeed, take “some leadership” to bang politicians’ heads together in both Labour and Tory parties in this country, Republicans and Democrats in America and their equivalent Left and Right parties in all advanced governments.

Debts don’t disappear without a great clatter

The big difference between the national debts of the advanced countries prior to the 2008 Crisis and now is that there is now no chance of their ever being paid off. Before 2008 there was conceived to be a chance by economists and treasury departments.

All that needed to be done, they said, was for the advanced countries to raise the economic growth rate above about 3.5% per annum and the debts would peel away every year and be entirely gone within a decade or two.

In reality there was little chance in the 10 or 15 years before 2008 because economic growth rates of the advanced countries had already declined every year to less than 2% — the threshold needed. During 2009 and 2010 with the (temporary) economic bounce-up — at least by China and some of the Second and Third World countries — there might have conceived to be a chance.

But no longer. National debts of the advanced countries are growing again — nowadays in leaps and bounds because governments, via their tame central banks, are releasing huge tranches of money, euphemistically known as Quantitative Easing. In reality, the extra few $ trillion or so are not going to consumers for them to spend it and get the economic machine going again but to the already-rich who are delighted to borrow it at absurdly low interest rates.

Apart from China probably having just a few more years of net exporting, and thus trade surpluses, the present world economic growth rate of about 1.5% — and that’s probably a cooked figure anyhow — it’s probably nearer 0.5% — will finally go down to zero. If we’re lucky. There’s only one way out of the growing mess. This is debt forgiveness.

More easily said than done. The trouble with this is that the worst offenders — such as America — will be the greatest beneficiaries. Those with large lent-out trade surpluses — China, Japan, Germany, Saudi Arabia and the Emirates — will see them vanish and thus be penalised. In short it will be monetary madness.

What will initiate the next catastrophe? It’s unlikely to be the large commercial banks — as in 2008 — because governments have a grip on them now. It won’t be advanced governments per se — that would involve too much loss of face — but more likely one of the hedge funds — one of the monsters which make up the world ‘shadow economy’ that, quite legally, is already larger then the governmental one.

Well, we’ll have to see, won’t we? Debts never disappear all by themselves without a great clatter that causes a lot of human suffering.

The adjusting economy

One early use of driverless cars will be car leasing. It’s already the case that even as uber driving is now displacing the normal taxi service in cities all over the world it will in turn be displaced by uber driverless cars. It will, in effect, be short-scale driverless car leasing. Indeed, Uber itself is said to be planning it already even as it continues vigorously to extend its ‘traditional’ service with part-time drivers.

But once short-scale driverless cars start to become established it will only be a matter of time before they becomes medium- and long-scale self-drive car leasing — that is, for journeys between cities or for other long trips.

So far, car leasing has not developed to anywhere near its potential despite the considerable cost savings that most car owners could make. The reason for this is that the car is the second-most important status good — second only to the home — that people buy. The car — or perhaps two or even three of them — sitting in the drive is a highly visible confirmation of the status claims that the owner makes for himself. Relying on leased cars means that there’ll be no cars in the driveway.

But if the economy of advanced countries for most of their inhabitants continues to flounder then the cost savings of leasing will surely overcome the present reluctance. Besides, if and when car leasing becomes the norm instead of ownership then there’s no reason why a leased car should not be available at different price levels according to brands.

So what is holding back (driverless) car leasing? Nothing it would seem. The most important factor are the colossal amounts of data that a driverless car needs to consult via cloud computing — that is, massive data banks. And this is precisely what is now happening in all the advanced countries. Microsoft and Amazon are the latest to announce plans for large databanks in this country.

It’s all happening a great deal quicker than could have been imagined as recently as five or ten years ago.  Ominously though, it doesn’t take a take deal of reflection to realise that car leasing — driverless or otherwise — will make for fewer jobs.  Another example of the Principle of Least Effort.

More reasons for electrification

Hard on the heels of the microplastic beads being identified as dangerous — and hopefully banned world-wide in cosmetic products within a year or two — comes news of yet another type of highly egregious micro material.

This time it is inhaled rather than being eaten and diffuses directly from the nose into brain tissue. The warning comes from Prof Barbara Maher and her research team at Lancaster University after analysing the brain tissue of 37 people aged from 3 to 85 who lived and died in Mexico City — a notorious air pollution hotspot — and some other high traffic places including Manchester.

These microbeads are of iron oxide — particles burned away from the steel inside petrol and diesel engines. Maher’s lab has established that there are millions of these particles in every gram of brain tissue. These are dangerous not only because of the ‘gritting’ effect mentioned yesterday but also because they are magnetic. What effect may they be having on the electronic transmission of brain neurons? Could this form of pollution be implicated in Alzheimer’s or other neurodegenerative diseases?

No one knows the full effect yet but this is why an admittedly small sample has already been given prominence by publication in the Proceedings of the National Academy of Sciences. We can be sure that further funding for such important research is already being laid on. Quite besides the known, and rising, effects of ignition engines — deaths from asthma particularly — all this is yet more reason why land transport must be electrified as soon as possible.

The Japanese calling the British black

Japan has now publicly threatened Britain in quite a thick document that if we actually do leave the EU at the end of negotiations then Japanese factories (Nissan, Honda) and other investments might shift to Europe.

Well . . . I wonder. During the referendum campaign one Nissan spokesman actually said that it wouldn’t make any difference even though Nissan would have to pay a 5% tariff. He might have had his knuckles rapped back home but his comment suggests to me that the Nissan factory up in Sunderland is more than already efficient enough to survive an EU tariff barrier.

I think this is a case of the pot calling the kettle black. The Japanese government is just realising that its latest major attack on a declining economy — the third in the last 25 years — is already failing. The fact that we’re getting out of an increasingly failing EU economy has upset the present prime minister.

Since we fell apart in 2007

A 5% profit margin, or a 5% price difference between one maker’s product and another’s doesn’t sound great these days, but they’re equivalent to 10% fifty years ago or 20% a hundred years ago. In 10 years’ time they’ll be equivalent to 2%.

The average world tariff that countries impose on the products of one another — unless two countries have what is euphemistically called a ‘trade agreement’ — is now 5%. Because, these days, modern ‘trade agreements’ also ccontain heaps of jargon about necessary regulations, they’re equivalent to the 20%, 30%, 40% trade tariffs that were common in the Great Depression of the 1930s.

Whether the present world recession — that is, the tremendous slowing down of what is supposed to be ‘economic growth’ (as measured by GDP) — is due to the 2008 Crash or whether the Crash itself was an inevitable event that only brought about recession prematurely remains to be seen.

Economists generally still haven’t got it into their heads that every mechanical system ‘hunts’ towards a state of using minimum energy according to the basic law of the whole universe — that is, the Principle of Least Effort (or the Maximisation of Entropy).

And ‘mechanical systems’ includes world trade. If governments want to see world trade expanding into the undeveloped countries and their standards of living raised to those of the advanced countries then they’ll have to find out how to expand the use of total energy inputs — coal + oil + gas + solar cell + wind turbines + hydroelectricity + any other ‘renewable technology’ — two or three or four or five times higher than ir is now.

It can’t be done for all sorts of reasons. Whether we — mainly China — are now getting close to maximum world production of consumer goodies, or whether we’ve already overshot, remains to be seen. One thing is for certain, governments are as bemused by the present situation as they were in 2007 when the world’s monetary situation started falling apart.

The celerity of the microplastic ban

Just like the danger of the hole in the ozone layer, governments and businesses all over the world have acted swiftly — once the danger is being known — to stop plastic microbeads being flushed into the sea, eaten by fish and thence by us.

But why, more precisely, are plastic microbeads, used in a vast variety of face creams and toothpastes, so dangerous? After all, they’re not chemically toxic or they wouldn’t be used for products in the first place. It’s because our body cells are not watery places in which chemicals are sloshing about. This is the concept that most people have of them. Instead, our body cells are full of machinery, full from top to bottom and side to side with scarcely any free water in them except a thin skin acting as a lubricant.

Our body cells are jam-packed with carbon-based molecules, some quite small but mostly — such as proteins — very large indeed when compared with plastic microbeads. The molecules are, however, very knobbly and have to be fitted together very very carefully and snugly before any chemical reaction can take place between them  Microbeads will stick to the knobbly molecules and, in time, when enough have accumulated, the molecules will not be able to fit together closely.  Chemical reactions will cease, cells die.

In short, the entry of plastic microbeads into our body cells has the same effect as throwing grit into a car engine.  Our body cells will jam up.  As for the microbeads, there’ll be no possible way of flushing them out.

Still slightly off the fence

Now that Presidents Obama and Xi Jinping are congratulating each other at the G20 summit that they both agree with the Paris Climate Agreement, it’s as well to remind ourselves that neither party has made any significant decision to show that they take it seriously. I thought I’d remind myself just where I am.

It’s a nonsense to say that we know what drives the global warming that’s been going on for about 150 years. The current orthodox belief is that the additional man-made CO2 in the atmosphere traps infra-red heart that that usually leaves the planet on a cloudless night — thus driving the temperature upwards.

But what about the other possible driver? This is that if the earth was getting warmer anyway for natural reasons — as it has done many times in the past — then the additional temperature releases CO2 from the oceans.

Both drives can be tested scientifically in laboratory conditions but their relative strengths can’t be compared within the setting of the earth’s surface itself and its cloud cover. It’s far too complex to control for all the variable factors that might be contributing to the second of the two drives above.

Until then I prefer to believe in the validity of the Vostok ice core sample — that, in the last 400,000 years, changing global temperatures precede, not follow, changing CO2 content in the atmosphere.

What future now for Uzbekistan?

Normally the existence of the ‘stan’ countries of central Asia are of little interest to us in Europe or America. The recent death of — or, rather, an untidy succession to — Islam Karimov, President of Uzbekistan, is likely to change all that for several reasons.

One is that Uzbekistan is potentially politically explosive. It was only the brutal tyranny of Karimov that kept a restless Muslim majority of the population at bay. Now that Isil is being snuffed out in Syria and Libya will Uzbekistan extremists return home from abroad? Will the country become another Afghanistan?

Another is that Uzbekistan has huge fossil fuel and mineral interests — including the world’s largest gold mine — that will attract the major powers. Russia and China both have oil and gas pipelines running through Uzbekistan and will want them to be protected.

Another reason — and perhaps the most interesting — is that Uzbekistan with Tajikistan and Kyrgyzstan on eastern and western sides of it, lies on what used to be the Silk Road. Not just lying on a trading route, several cities glowed with prosperity until about 1500 — manufacturing centres with products of the greatest skills. For several centuries Samarkand was one of the most advanced cities on earth equivalent to Rome or Baghdad.

And, as to its Silk Road past, Uzbekistan is going to feature importantly as part of a new expressway between northern China and Europe. This is the main project of the Asian Infrastructure Investment Bank (AIIB) authored by China and already subscribed to by all the countries along its route. Uzbekistan and its contiguous ‘stans’ are likely to be the fastest economic catch-ups of any so far.

The young doctors will probably win their fight

A real honest-to-goodness strike by young hospital doctors in the National Health Service, just like car factory workers of 50 years ago is now going to take place. Unlike working class strikes, this one by their middle class trade union, the British Medical Association, is a great deal more planned in advance.

They’ll strike straight through for five days starting on 12 September followed by 12 more paired days when they’ll strike during normal daytime hours. When middle-class people take action they don’t do it by halves!

It’s mainly about extra pay during nights and week-ends, particularly on Accident and Emergency services duty. The Health Minister has offered them 37% extra pay but this will not be paid monthly in terms of hours on duty but on complicated formulae which can’t be fully computed until a doctor has worked a full year. It’s a bureaucratic conceit and designed, of course, to notionally save money — though it probably wouldn’t because it would also necessitate more bureaucracy.

This is a case where the Minister, Jeremy Hunt, should not have been solely guided by his Department of Health officials but have also consulted with those who’ve had personal managerial experience with workers who go on strike.

Who will win the fight? It’s difficult to tell just at the moment. Much will depend on public reaction in the next few days. But probably the doctors.

Trump as a wake-up call

It is of the deepest irony that the policy Trump is despised for more than anything else — building a border wall — is one that the Brussels bureaucrats would gladly adopt, were the EU’s member countries as snugly arranged as the US member states.

Compared with America’s simple topography, the shape of the EU is more like a Rorschach inkblot test. Building an equivalent border is impossible. Preventing mass immigration could only be achieved by making sure that would-be travellers don’t start out in the first place — either by voluntary decisions or by physical force.

Migration from the Middle East — and beyond — is blocked off at present with the help — or is it blackmail? — of Turkey.  Migration from Africa, whether from war-torn Eritrea, Sudan or Nigeria, or the continent more broadly, is increasing.  Until the whole coastline of north Africa is sequestered in some way by governmental agreement or militarily then migration from Africa will only increase from now onwards.

Trump may well be a dangerous President if ever elected – which is now becoming increasingly unlikely — but at least he latched onto one of the fears of at least half the electorate, something that the politicians of both America and Europe ignored.  The eruption of Trump onto the electoral scene ought to be a wake-up call that the century-old political system needs radical reform to adjust to modern circumstances.

Where do prostitutes come from?

Steve Kurtz sends me a fascinating article by Alexandru Micu, “The red light forest — Prostitution in the animal world” about what can only be described as prostitution in the animal world — or at least in three species that have been separately researched on the matter. I’ve precised the article below:

Chimps are a highly promiscuous species, but the females only in their fertile period. Not being as physically strong as the males, the females rely a great deal for extra protein on their preferred partner or, indeed, on any of the males in their group’s joint hunts. If the hunt is successful the males will share out surplus food to others, preferably females, even more so to females who closely atttach themselves closely to specifically to each male during the hunt. In return, the more successful higher-ranking males tend to have more sex — that is, are offered more sex — with the femaleswho had been more selective beforehand.

Adelie Penguins
These penguins generally pair for life and they will both prepare a nest consisting of building up a circular wall of pebbles into which an egg will be laid. If pebbles are relatively scarce then there’ll be plenty of ferocious quarrels and stealing from neighbouring nests, including those of bachelor males. Some females walking out of sight of their partners will often visit a bachelor nest, offer sex and then quickly take a pebble from his nest and return to her own nest. If she’s discrete about this she may do this.

Carib Hummingbird
In this species males and females each establish feeding territories of their own. The males, being larger and stronger than the females can easily establish larger territories which guarantees them at least enough nectar on which to survive even in periods of drought. In such periods females will fly to a male’s territory, offer sex and be allowed to feed for a while — though not too long before the males will chase her away. In this way, the species has managed to survive even during periods when food was scarce.

Waiting for the Good Life

An interesting dispute has now erupted between Apple and the EU over $14 billion in taxes that the EU says should have been paid to Ireland over the past decade. Instead, because the EU says that this shortfall is giving Apple favours, it now propose to punish Apple with a fine.

Not only has this aroused the ire of Tim Cook, the chief executive of Apple but also the US government. This is very curious because the US is supposed to be friendly to the EU. At least it was a few weeks ago when President Obama chastised Britain for contemplating leaving the EU.

Since then there’s some (French) rumour that the Transatlantic Trade and Investment Partnership (TTIP), which has been in negotiations between the US and the EU for the past eight years, is now in its death throes. Perhaps the US has now given up on seeing any future for the EU. As well it might, seeing that the EU is retreating more and more into its own tariff-fortress walls with every passing year.

The dispute is “interesting” rather than significant because it is only one of many disputes that are going on between major multinational corporations and governments. The latter are constantly trying to muscle in on the activities of big business in order to increase their taxation. The former are constantly trying to remain as free as possible from depredations.

All this is to be added to the normal competition that goes on between businesses and also between governments. It’s all a reminder that once we started to leave hunter-gathering behind us 10,000 years ago, we haven’t yet managed to develop suitable organisations that make for Good Lives for all of us at work and leisure.

Bouncing out of Hinkley Point

It was fortuitous that Theresa May fell into the empty slot of becoming Prime Minister just in time to prevent the junketings that were planned for the signing of the contract for the construction of the EDF’s reactor at Hinkley Point. Had they gone ahead it would have immediately become a member of the “Too Big to Fail” brigade — just like our four grossly over-large retail banks — and kept alive with large amounts of taxpayers’ money for years to come whatever its failings and overruns.

And these — the failings and overruns — are inevitable because the technology involved is far from being fully developed, as we know from the long delays in building similar reactors in Normandy and in Finland. I thought originally — a few postings back — that May was making a gesture against the state-supported, trade union-run, semi-bankrupt, EDF.

But no, it is said that she didn’t like to see so much additional Chinese funding in the project. Will China be able to wheedle its way into our electronic security systems? Hardly. In any case, China — like Russia, America, and ourselves probably — will have expert hackers who are already doing that sort of thing as their normal official day job.

On reflection, I think she’s delayed proceedings in order to have time to look at the proposal in the round, and to consider alternatives. This is something Hinkley Point has simply not had so far. This is a multi-billion pound project which has been whisked through with highly suspicious celerity so far. We were being bounced into it.

More benefits to sex streaming

According to the Children’s Society’s latest annual Good Childhood Report 14% of 10 to 15 year-old girls in the last year or so are unhappy with their lives — predominantly on their physical attractiveness, or lack of it. This compares with an average figure of 11% in previous years. Boys have remained at 11% unhappiness.

Th increase of 3% in girls’ unhappiness may not seem much but the data is gathered from 40,000 households across the country so it’s real enough. The Children’s Society are worried enough to say “that concerted action is needed to tackle this problem”.

What is the cause? The Children’s Society think that because girls spend so much more time than boys on the social media — without specifically mentioning Facebook or Twitter! — then this is to blame. This is probably correct. Boys who spend time on the internet are more likely to be paying video games. In any case, emotional bullying among girls is twice as common as physical bullying is among boys.

If the internet is to blame for girls’ increased unhappiness then what can be done? Nothing, to be realistic. However, the figures for unhappiness clash with other data outside the purview of the Children’s Society. Boys’ unhappiness evidently increases significantly as they grow into young adulthood because their suicide rate is much greater than girls’.

The basic reason for the discrepancy is that girls’ brains develop years ahead of boys’ brains. They become adult three or four years sooner. Between 10 and 15 years of age girls are already feeling the instinctive need to have children and, therefore, the desirability to be physically attractive in order to clinch their choice of a good fellow parent when she’d found him.

All this even if, rationally, it makes more sense these days of more equal opportunities and pay to make a good career for themselves first. And here is a chink of light as to the solution. After puberty girls and boys really ought to go into separate education streams so that girls can forge ahead at greater speed than boys.

This ought to men that if girls are taking their A-levels three or four years younger than boys then they’ll have somewhat less time to spend on the internet. Also when they get to university, the boys in their (now mixed) classes will be three or four years older and — probably– feeling less pressured than they do now.

Separate streaming is inevitable one day in those countries which free up their secondary schools and competition between them drives the less efficient to the wall. It should also solve other problems such as the one that the Children’s Society is presently drawing outer attention to.

Why is there a different rule for hard drugs?

What is the difference between consumer goods and services that are illegal and those that are legal? It’s not so clear cut as might be imagined. Is it because government has a duty of care to its citizens and thus wants to protect us from harmful goods and services? Or is it because those with well-paid careers in government — principally senior civil servants and politicians — want to maximise taxation income from the sales of legal products and services that should otherwise be illegal.

It’s a bit of both according to the particular goods and services and how widespread they already are. Thus, knowing what we know now about the health dangers of too much sugar and alcohol, both should be made illegal under the duty of care. But because they were both deeply addicted to by the vast majority of the population long before big government came along, it would be politically impossible to impose punishments for offenders now. As a result, both are on sale just as normal consumer goods are — as different brands with different quality and price levels so that everybody from the richest to the poorest in the population can imbibe them and be taxed accordingly.

Not so with regard to ‘hard’ drugs such as heroin or cocaine or some of the modern ‘legal highs’. We must all be protected from them, it would seem. However, in one or more countries where one or more hard drugs are not illegal and thus where the normal phenomenon of differential price setting occurs according to quality, the evidence is that only a small minority are in danger of over-addiction — with the result of nowhere near as much ill-health or crime engendered as by alcohol consumption in this country,

The normal market should be allowed to operate as with all other consumer goods and services.

Managing without the Bank of England?

One of the liveliest minds at the Bank of England is its chief economist, Andy Haldane. He frequently sounds off with ideas you don’t normally expect from someone employed by such a bureaucratic organisation.

For example, he recently suggested that — computers being as powerful as they are — there’s no reason why we shouldn’t all have a personal account at the Bank of England — presumably doing away with high street banks altogether!

Another was that the pound — or the dollar or the euro — could adopt a block-chain technology, rather like the Bitcoin, so that each of us could make person-to-person payments directly without going through intermediate bank accounts. This was taken further by suggesting that, as most transactions are now becoming purely electronic, we might not need cash itself for very much longer.

All these have been said tongue in cheek no doubt but they cause us to think a little. His most recent statement, however, was made more seriously when he was asked about planning for retirement. Is it better to base it on property or in a pension fund? “It ought to be saving for a pension but it’s actually property every time”, he replied. “We’re building far too few houses. House prices will be heading north for decades to come.”

What Haldane could have said also is that pension funds rely on dividends on shares and high manufacturing wages but they’re both coming down, and will continue to do so as world-wide competition — already very great — intensifies.  It’s already the case that many pension funds have “terrifying shortfalls” according to Ed Monk, writing in today’s Sunday Telegraph.

However, if Haldane had said this then he would also be implying that capitalism as we have known since the 19th century is coming to an end as we enter a new type of professional services era. M’mm . . . perhaps it would be too radical to say so — the Bank of England might not even be needed in the new scheme of things and he’d be without a job!

One problem less for Theresa May

Whatever the bat-and-ball game was called in Tudor times, before the forced union of Scotland with England in 1707, it became golf in Scotland and cricket in England. Despite the contrived collegiality of ‘TeamGB’ at the Olympic Games which our new Prime Minister Theresa May made no great thing about when they returned — which David Cameron certainly would’ve — she made a point of spending yesterday at Lords watching the English cricket team play Pakistan in a one-day match.

In contrast to the jingoism of several of our recent past prime ministers and their copious use of “Great Britain” and the “United Kingdom” in their speeches, perhaps Theresa May will allow Scotland to secede as a separate nation without too much further fuss and bother. If so, she’ll be resonating with a steadily increasing number of those who see themselves as English rather than Great Britainish.

With imagination, she might also solve the perennial problem of Northern Ireland, that almost ungovernable bunch of six counties which, almost 100 years ago, Lloyd George mistakenly kept apart from the rest of Ireland when it became independent. She could call the bluff of the Protestant politicians there and give back the six counties to where they belong — the rest of the island of Ireland. Furthermore, it would solve another huge potential problem. When England leaves the EU, then there need be no danger of massive EU immigration via Ireland, an EU member, and a borderless Northern Ireland and a ferry ride to Liverpool.

Waiting for the real bus

The idea of the Elevated Bus (EB) certainly took me in. A photo of the unique Chinese invention appeared in many newspapers and on the internet. The EB, standing atop of a motorway, wide enough to straddle two lanes and carrying hundreds of passengers, could stop and start at bus stops while allowing two lanes of car traffic to run through it unimpeded. It was professionally designed, obviously money had been spent in making the prototype and it seemed a go-er.

Which is precisely what it was intended to be, offering a high rate of return in order to attract the savings of Chinese people. It now turns out to be a scam, one of the many different sorts of confidence tricks that are now being tried out on relatively naive Chinese investors. Far from being a Chinese innovation, this one was yet another example of copying the sorts of financial scams that we’ve suffered from in the last 20 or 30 years from banks, ‘independent financial advisors’ and other bodies in the financial sector.

Are the Chinese capable of innovation? They have been in the past and there’s no reason to doubt them in the future. Are the Chinese — with a self-selecting bureaucratic government — capable of innovation in modern times? That remains to be seen.

Governments still confused about culture

Burkinis — shapeless, full-bodied swim-suits worn by Muslim women — are in a quantum state in France. Like Schrodinger’s cat, a ban against burkinis exists and doesn’t exist simultaneously. Some 30 mayors of south-coast towns with attractive sea shores have announced a ban on burkinis on their beaches. Two mayors — of Nice and Cannes — have also imposed fines. However yesterday, over and above the mayors, France’s highest administrative court, the State Council, has lifted the ban. Controversy has been let loose.

Meanwhile, Nicolas Sarkozy, centre-right candidate for the French Presidency next year, swinging further to the right in order to steal the vote for extremist, Marine le Pen, has also adopted the mayors’ burkinis ban for the whole of France. He’s building on the ban against the Muslim women’s face veil which he successfully brought about five years ago when he was previously president.

So France is in a state of confusion about these cultural matters, but no more than we are in this country — nor in America where it’s colour of skin that’s the issue rather than religion. None of the governments concerned have yet realised that there’s all the difference in multicultural harmony between a mixed group working happily together to produce an income — or some other challenge — and the same mixed group during their leisure hours where a much wider range of cultural differences come into play — each to its own kind — and can badly jar one another if situated too closely.

Transforming our health?

Now that most of us are content with possessing the standard kit of status goods — house, car, furnishings, clothes, personal ornamentation, etc — of whatever form and price that suit our social level, there are still two costly items left which are — seemingly — unlimited. These are health and education. And for those without children, or whose children are grown up and independent, it is health alone.

And, whether health services are private, or a mix of private and governmental, they are the fastest growing items in all advanced countries. We are living longer, better treatments are being developed and medical knowledge — and thus expectations — are also growing at a pace. Whatever the systems that supply health services they are now buckling financially.

In this country, where most health care is governmental and paid for by taxation, the National Health Service has been buckling for years as different organisational strategies for keeping costs down have been tried and failed. The latest one, called the Sustainability and Transformation Plan (STP). although still under wraps, is due to be launched in 2017, according to Sarah Bloch-Budzier of the BBC. Basically, it involves the integration of standalone hospitals into local medical and social services.

This is bound to be a controversial — not to say, explosive — issue between the think-tanks and the political parties. Who knows whether it will truly transform and truly make health services sustainable.

Are proximanians watching us?

The discovery of Proxima B — a possible life-bearing planet — is sending many astronomers into whoops of delight. Although many other possible life-bearing planets have been discovered in recent years, Proxima B is relatively near to us, only four light years away.

It doesn’t mean being able to visit it anytime soon but it does mean that its surface can be investigated in a great deal more detail in the coming years, maybe enough to pronounce whether life does, in fact, exist there.

Given that life on planet Earth — intentionally or not — has evolved increasingly intelligent species, could the same have been happening on Proxima B? If for longer than our 4 billion years history, maybe some species of proximanians are considerably more intelligent than humans.

Perhaps proximanians have been watching us for ages, but keeping low, not wanting to reveal themselves until we’ve learned to govern ourselves a little more sensibly than we have done hitherto.

The less than jubilant trio aboard the Garibaldi

The leaders of the three largest countries in the EU — once Britain leaves — have been meeting on the Italian island of Ventotene. At the end of it they gave a press conference on the deck of the Italian aircraft carrier Giuseppe Garibaldi which was appropriate because most of what they spoke about publicly was defence.

But when in private discussion, defence would have been the least they would have spoken about. (NATO is already in existence for that purpose.) What’s much more important is how is the EU going to hold together.  Historically, currency Unions — when several countries share the same currency — have never yet held together for very long.

The reason is that one size — that is, the same value of the common currency and the same interest rate — does not fit all. A euro interest rate that suits Germany does not suit Greece. A low interest rate that would suit Greece and attract foreign investment and consequent prosperity would deprive Germany of funds and Germany would suffer in due course.

In their haste to become a political nation-state 50 years ago the founders of the EU forgot that it has to be an economic nation-state first. It needs centralised accounts and budgeting before all else. This is the fatal flaw in the EU and what Francois Hollande, Matteo Renzi and Angela Merkel would have really been talking mostly about during their hours together on the island.

They didn’t find the answer or else they’d have announced it jubilantly on board the carrier.

Having a chance of a fascinating environment around us

The Industrial Revolution (IR) is over and done with. Considering that only half a billion people are presently enjoying the full benefits of the IR then we can reasonably surmise that the world population — now expected to rise to about 11 billion before tailing off — will have to sink to about the same number of half a billion people world-wide in order to share the same standard of living.

As it is, the present world-wide recession — foxing economists everywhere as to how to end it and to stimulate growth — will continue at about the same level of economic activity as now. The fact that China — which has already reverse-engineered the West’s financial system and knows it, if anything, better than we do — is now grinding to a halt is a good indication that world trade must be somewhere near stabilisation point.

Unless our brains change — that is, become dulled due to some unknown toxin — then scientific discovery will continue, as also innovation, if not so much to extend the list of consumer goods but to make our production systems and our infrastructure vastly more efficient than they are now. This would also mean that we would be making smaller claims on the earth’s resources and that we will have a chance of having a rich and fascinating natural environment around us.

Goodbye to Choudary for a while

At long last, Anjem Choudary, 49, the radical Muslim cleric, has been convicted and found guilty, and is now awaiting sentence on 6 September. Born and bred in this country he has previously practised as a solicitor but also as a spokesman for Islam4UK, now a proscribed organisation.

A hard-line political Muslim, he is a believer in replacing British laws and institutions with Sharia law and clerical governments. He receives little support from the mass of Muslim immigrants in the country who find him as much a social embarrassment as the culturally non-Muslim English find him a dysfunctional individual whom they’d rather not have among them.

For over 20 years he has been clever enough to keep just an inch or two inside the law of sedition and racial hatred and, as we believe in individual freedom of thought in this country, as a development of our Magna Carta tradition, he was untouchable.

However, on YouTube some months ago he went too far in praising the Independent State of Iraq and Levant (Isil) and its savage ways. He also praised the actions of those terrorists responsible for 9/11 in America and 7/7 in this country. The court accepted this, and the jury confirmed this as being equivalent to encourage any of his adherents to do likewise. Quite why he allowed his self-control to slip we didn’t know but it was probably inevitable. A pity it didn’t happen years ago.