Category: Main

From Jeff Randall in the Telegraph, a piece on the carnage of DIY over the Easter weekend.

The curse of DIY is inflicted on us by two policies: income tax and trade credential regulation.

The income tax is obvious: There is a job in my house that will take a skilled person an hour. I have two choices: I can do it myself, or I can work for money with which to pay someone else to do it.

Assume I get paid the same as a skilled tradesman. I have to work for an hour to pay for an hour of his time. Then I work for another 40 minutes to pay his income tax. Then I work for another 17.5 minutes to pay the VAT. Then I work another 78 minutes to pay my income tax. In the end I have worked three and a quarter hours to get an hour of someone else’s time. The temptation to think I can do it myself in less time than that is very strong.

The credentials are the other problem. The costs of getting a professional are inflated by rationing the supply.

It can be argued that the regulations are necessary to protect from under-skilled practitioners. But that assumes that the result of banning the less qualified provider will be that a more qualified one is used. The facts of DIY show the fallacy of this – if I can’t hire a cheap workman, I’ll probably have a go myself, with worse consequences.

It is like the ever-increasing monitoring of the quality of parents. I have seen at quite close hand the struggles of the underqualified single parent attempting to keep her child out of the clutches of the state. The process could possibly be justified if the end result was giving the child a better home, but in reality the only alternatives are the foster system or a children’s home. The most stringent sane criterion for judging the adequacy of a parent is whether she is doing a better job than the children’s home would, and the most stringent sane criterion for judging whether a workman should be allowed to do a job is whether he would do a better job than his potential customer.

I watched 300 last week, and it was a pretty good film of the sort I wouldn’t normally bother to review here.

I am, however, somewhat struck by the massive point-missing that has gone on. Many have complained that the film appears to be crude political propaganda, although there is some dispute as to who is being supported and who attacked.

How many of these people actually stayed to the end? The film is indeed crude propaganda, as we see at the end the narrator of the whole movie, the David Wenham character, standing in front of an army doing the St Crispin bit, presumably at the battle of Platea.

All the things that have been attacked make perfect sense in that context. The characters banging on and on about freedom while their many slaves never appear in shot, the domestic political rivals of the narrator being represented as hideous subhumans, the improbable monstrous character of the Persians (and for that matter the wolf) — the film was not the battle of Thermopylae, it was a pep-talk for Platea.

I haven’t read the graphic novel, and indeed have only the slightest aquaintance with them (Miller’s The Dark Knight Returns is I think the only one I’ve ever bought), but that kind of perspective-choice is one of the things I think they can do well.

The imagination of another’s perspective seems to be something in very short supply. Witness as just one example the Telegraph editorial yesterday accusing Iran of “meddling in Iraq” — it takes an amazing lack of imagination not to see how ludicrous that sounds.

It is reasonably obvious that the biggest factor affecting the quality of a school is not the building, the management, the teaching staff, or the level of funding, but the intake. By that I do not merely mean that pupils who go in better come out better, but that a pupil entering a school with a good intake will come out better than the same pupil would entering a school with a bad intake.

While this is widely recognised for schools, I think it applies also, and possibly just as much, to other public services. The difference between a good train service and a bad train service is, to a significant degree, down to the passengers. The biggest reason for a person to prefer to drive a car, rather than take a train, is to avoid the other people who would be on the train. Indeed, the point is so strong in transport that we do not consider as “public transport” a service which does not force us into proximity with other users, i.e. taxis, which operate on exactly the same basis as any other form of public transport.

There are two kinds of public/private distinction: there is the distinction between state-provided and privately-provided services, and the distinction between publicly-consumed and privately-consumed services. They line up sufficiently to cause confusion, because publicly-consumed services are not excludable and are therefore “public goods” generally considered better provided by government. Public/private provision is a more definite yes/no question, albeit with hybrids funded by subsidy plus usage fees, while public/private consumption is a continuum – a medical operation is a private good, but control of infectious disease is somewhere in the middle.

It is with this assumption that I look at Tyler Cowen’s controversial assertion that, as an effect of differences in structure, Western European governments provide public services better than the US government can. To the degree that this is true, I think the cause is more to do with the different attitudes of Europeans and Americans to public services than to different structures of government organisation. As the Economist blogger illustrates, even a straightforward benefits system will be much more effective in a public-oriented society like Denmark than in the USA.

In Britain, we seem to have the worst of both worlds: something approaching a European-sized state sector with very American public attitudes to the services it provides, and I think that more than anything explains the current state of our public services. It was not always that way — some years ago I mentioned in a discussion of mobile phone tariffs that, where evening calls were free, some customers were using their mobile phones as baby monitors, by making a call from one handset in one room to another and leaving the call open all night. To me that was reasonable and unsurprising, but my older friend found it hard to believe that people would abuse a limited public resource that way, just because they weren’t being charged. Publicly consumed services work much better with that older generation’s attitudes than with those of my generation.

My collection of toys was augmented last month by this device:

Notice the puzzle displayed in the image:

8 4 . . . . 6 . .
. 2 . . 6 8 3 . 4
3 . . . 1 . 9 . 8
. . . . . . . . 3
2 8 5 7 9 . . . .
1 . . . 2 6 . 9 7
. . 8 . . 5 . 4 .
5 9 . 2 . . . 8 6
. 7 2 6 . 9 . 3 .

Unlike a proper sudoku, the grid does not have a unique solution. Any of the following three filled grids are possible:

Solution 1
8 4 1 9 3 7 6 5 2
7 2 9 5 6 8 3 1 4
3 5 6 4 1 2 9 7 8
9 6 7 1 5 4 8 2 3
2 8 5 7 9 3 4 6 1
1 3 4 8 2 6 5 9 7
6 1 8 3 7 5 2 4 9
5 9 3 2 4 1 7 8 6
4 7 2 6 8 9 1 3 5

Solution 2
8 4 1 9 3 7 6 5 2
9 2 7 5 6 8 3 1 4
3 5 6 4 1 2 9 7 8
7 6 9 1 5 4 8 2 3
2 8 5 7 9 3 4 6 1
1 3 4 8 2 6 5 9 7
6 1 8 3 7 5 2 4 9
5 9 3 2 4 1 7 8 6
4 7 2 6 8 9 1 3 5

Solution 3
8 4 9 5 3 7 6 1 2
7 2 1 9 6 8 3 5 4
3 5 6 4 1 2 9 7 8
9 6 7 1 5 4 8 2 3
2 8 5 7 9 3 4 6 1
1 3 4 8 2 6 5 9 7
6 1 8 3 7 5 2 4 9
5 9 3 2 4 1 7 8 6
4 7 2 6 8 9 1 3 5

My experience with the device has exposed more errors of this kind. On “Medium” difficulty, I got the following grid:

4 3 . . 1 8 . . .
5 . . . . . . . 1
. 9 1 . . . . 6 4
. . 3 . . . 7 . 6
9 . . . 6 . . . .
6 . 5 . . . . 9 .
. . . . 7 6 . . 9
. 6 . . 5 . . . 7
. . . 8 . . . . .

I will not enumerate here the 13748 solutions my trusty xemacs mode found for that grid. The only one the machine accepts as correct is number 10310.

Does anybody have Carol Vorderman’s email address?

Since I installed Rockbox on my M5 there’s no need to use it anyway, but it’s really my public duty to complain.

Private Equity, blah blah blah, capitalism, blah, tendency to monopoly, blah blah.

Cadbury Schwepps announced plans to split into two separate businesses.

“Splitting into two distinct companies could dramatically increase Cadbury’s value – perhaps by £3.4bin

“It may also become easier to manage after suffering a spate of problems”

This is happening under the threat of a takeover by a private investor.

The force driving companies to get bigger is Parkinson’s Law. The force tearing them apart when they get unmanagably large is the market.

The size of a company that matters for organisation is not the annual turnover, it is the number of decision-makers.

Listened to last week’s EconTalk, with Viviana Zelizer talking about the divide between the initimate and the commercial.
It struck me as a huge exercise in missing the point. Not once were the key words mentioned. They are trust and commitment.
Contracts are all very well when it is possible to specify precisely what each party expects to get out of a relationship. However, if I have expectations which I can’t practically define and enumerate, then I can’t put them in a contract.
However, it is frequently advantageous to be able to make binding commitments. How do we do that in cases where we can’t use contract enforcement to make the commitments binding?
Fortunately, there is a mechanism built into us. Humans can form emotional bonds with other humans. If parties to a relationship can see that the other parties have emotionally bonded to them, then they can have confidence that their needs in the relationship will be met, without recourse to contract lawyers and bailiffs.
It is possible to fake an emotional bond. The central question of much human interaction is whether, and how strongly, such bonds have genuinely formed. The literature on this subject is vast, and includes a large portion of all fiction ever written. We are continually on watch to check that the bonds others have to us are still strong.
This is the reason for what Zelizer calls the “Hostile Worlds” of the intimate and the commercial — the deliberate and socially expected attempt to separate, as far as is practical, intimate relationships from commercial relationships. If those who we believe are with us for emotional reasons are actually with us for commercial reasons, we can no longer rely on their emotional bond to enforce their commitments beyond what we can achieve in the courts.
This is by no means an original line of reasoning: I’m sure I’ve come across it in books by Diamond, Dawkins, Matt Ridley as well as writings by economists. The issue of signalling an emotional commitment came up at length in an earlier EconTalk podcast on religion, so I’m disappointed that Zelizer ignored the question, and that Russ Roberts didn’t bring it up. It defines the boundary of the intimate and the commercial (because it is the answer to “why do we care”) If we expect consideration from a party to a relationship beyond what we are able to define and enforce publically, then we must rely on intimacy – emotional bonds – which themselves require a certain amount of care and maintenance.

Update: more thoughts on the question

There have been various attempts to derive private property rights absolutely from some kind of first principles. I have not been impressed by them. It’s not that arguments like this are obviously wrong, it’s just that equally persuasive arguments could be made for almost any basic political position, including many that I want no part of.

No, I am prepared to accept that the law that you can’t take my stuff the moment I turn my back on it is just another government regulation, not fundamentally different from the many that I howl against.

Given that property is not fundamentally a different kind of thing, why do I support it over the other ways that a society can organise its resources?

The root is that property is, relatively, very cheap and easy to enforce, compared to other possible rights. It is practical for me to take most of the responsibility for enforcing my private property rights myself, by keeping hold of my property and keeping an eye on it, leaving relatively little for the public sector to do. It is also relatively easy to work out whether I own something, compared to trying to determine, for instance, whether I most need it, or whether I most deserve it, or whether I can make the most productive use of it, all of which could be seen as “better” criteria for whether I should control it. Private property enables us to co-operate, not perfectly, but quite effectively, with a minimum of administrative cost.

With that as the basis of my support for private property, this quote by Lawrence Lessig has incredible power:

…the government has designed [the copyright system] so that there’s no simple way to know who owns what, the very essence of a property system.