Fundamental Rights - On Glasgow, Edward Snowden and the Inconsistency

Last week the Student body of Glasgow surprised everyone by electing Edward Snowden as University Rector, a notion subject to a number of jokes, including my personal favourite "The most important feature of a rector is the ability to leave Russia".

I'd like to add an interesting inconsistency with this entire debate, about surveillence, personal liberty, integrity etc. Snowden said the following in an interview given to the Guardian:

"If we do not contest the violation of the fundamental right of free people to be left unmolested in their thoughts, associations and communications - to be free from suspicion without cause - we will have lost the foundation in our thinking society." - Edward Snowden

Key points here are unmolested in their [...] associations. Most people would agree right.

Let's now apply that to other areas, say economic ones. Tax rates, for instance, or even food regulation laws. Where does that leave us?

How is any rate of taxes consistent with "unmolested in their associations"? Politicians decide to take some percentage of anything you make/sell/earn, add VAT to anything you buy, and also take chunks of a large bit out of corporative profits. If anything could come close to "MOLESTING", this would be it.

Ok, let's go with food regulations. In my native country, the rules that apply to retailers of food, producers, restaurants, café or anything connected to food, are extensive and the Government even has its own authority to give permits, inspect and decide upon what you can or cannot do in the food business. Likewise the UK, Germany, France (not to mention EU standards) have regulations for how such business is to be made. Yet again, how can anything be more in line with "molesting free people in their associations"? If I enter into a transaction of, say, disgusting and rotten food, that's my responsibility. Not to mention the obvious point of WHY I would enter such a transaction? (and, if food contains whatever substance I can't inspect on my own and that makes me sick, I say it's safe to assume that neither me nor anyone I know would buy from that company again - i.e, incentives align to produce good-quality food).

Point is, our Socialist Governments (including those labelling themselves as Liberal, Conservative etc) are filled with regulations, tax rates, fees, distortions to freedom - all of which represents "violation to the fundamental rights of free people to be left unmolested in [...] their associations".

Now tell me, if integrity, personal freedom and "Freedom to be left unmolested" are such virtues in terms of tele-communications, surveillence - how come they're NOT virtues in the fields that actually matter? THat is, taxes, price-levels, regulations to people and business and virtually all parts of British society?

Inconsistency. Hypocracy. Lousy. If freedom and integrity are good enough reasons to sanctify Edward Snowden, why are they not good enough reasons to reduce taxes, remove regulation and increase real freedom? Stuff that actually matter.

If you seriously want to embrace freedom, I'll be the first to congratulate you. But until then, stop pretending you're a supporter of freedom only because you agree with Snowden. Get real.

The Perverse idea of 'Relative Poverty'

The idea of "Relative Poverty" is normally put forward as a useful indicator and an evaluation of whether a government policy was successful or not. Especially by leftist organisations and debators, claiming that absolute poverty is not relevant, but it is relative poverty (that is, income in relation to others) that actually matters. In this post I'll explain to you just how perverse such a nonsensical idea is.

The commonly used definition of Relative Poverty is "60% of national median income", used by the EU and the UK Government. As the UK median income is something around £420/week, the relative poverty line would come down to £250/week.

The intention is to show poverty in relation to neighbours, friends and others around you. The underlying assumption is that, even if you are far wealthier than poor people in absolute terms (that is, below $2/day), you still feel poor, because everyone around you earn more than you do (adding various social implications etc).

Needless to say, this is absolute rubbish. With this definition, holding everything constant, (including my earnings, prices etc), if we'd give the poorest person a million pounds in income, so he ends up on the upper scale of the income distribution, the median income would increase, thus pushing some other person below the 60% of median income. Bottom Line: If some random people would see increased incomes, YOU'D become poorer. The fallacy is unbelievable.

Now I have a chart for you to illustrate this a whole lot better. Since New Labour came into power in 1997, they have more or less aimed for reducing poverty (Blair even commited to "Eradicate Child Poverty" at some point). Below I added numbers from the UK Institute for Fiscal Studies, showing the development of Median Income in UK and the percentage of the population at that point falling below the 60% "Relative Poverty Line".

The Red Line shows median income, referring to the right axle of £.
The Blue Line shows the Proportion (in %) of the population falling into the catagory of "Relative Poverty", referring to the left axle of %.

The proportion of the population living in relative poverty initially fell, then increased to its peak around 2007. That is, whatever the UK Government done during this period it had effects both on reducing and increasing Relative Poverty by small amounts (+-1% point).

However, when the financial crisis hit in 2007-2008, throwing the world economy into a crises (with lower wages and unemployment), the median wage consequently fell. The perverse effect then is that the proportion of relative poverty ALSO fell - from almost 19% down to 16% of population. Why? Because the line is tied to median income; when median income falls, the crucial amount earned to fall below the defining line of relative poverty dropped, resulting in less proportion of the population being catagorized as in "Relative Poverty".

That is, focusing on "Relative Poverty" meant that the effects of a global financial crisis did a lot more to help UK people to escape relative poverty than did the UK government in the decade leading up to it. An absolutely perverse effect, and an outrageous claim.

Needless to say, whenever you hear someone talk about "Relative Poverty Line" or "Poverty Increasing in the UK", you know it's a load of rubbish. It has no relevance to actual poverty.

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Seen on a global scale, however, the median income is £10, resulting in a "world relative poverty line" of £6. Bottom Line: barely NOONE in the UK falls below the world relative poverty line, using the fallacious definition of 60% of median income. That's about how useful the idea of "Relative Poverty" is.

A reassessment of Public Policy

I have run up the somewhat exhausting habit of expecting the worst from every single encounter with the Public Policy course. Up until today, all of my lectures and most of conversations had in tutorial sessions have been greatly biased towards socialism, as seen in earlier posts. 

The current unbeatable record of time before blaming Thatcher and/or NeoLiberalism for most evils in the modern history of UK stays at 4 minutes. A standard has emerged for how those lectures took place - until today!

The first series of lectures in any particular field is always interesting, because it says something about the topics and an introduction to how the lecturer approach them. Today, as any other day, I didn't expect a record but no more than 15-20 minute before Thatcher ruined the show. To my surprise the entire 50 minute lecture elapsed without any charge against neither the former president nor her political convictions.

Instead the lecturer showed us fascinating numbers on British Public Expenditure - astonishing numbers that I'll go into at some future point. And I only percieved one tiny violation of math, and I even suspect it was unconciously done in passing. That is, my post on Social Scientists to learn math was uncalled for.

Thatcher-relating topics was mainly reduced to displaying the following quote, as a bridge to tomorrow's topics. As true back then as it is today. Enjoy!

"The Problem with Socialism is that you eventually run out of other people's money" - Margaret Thatcher

Maybe I judged the entire staff of Public Policy lecturers at Glasgow a bit too severe. After all, some of them need to justify their salaries! We'll see about that tomorrow.

UK 'Help to Buy', or just a regular party at Uni?

After a first turbulent decade of the new century, with artificially-low interest rates, Subprime crisis and housing booms you'd figure Governments around the world learned a thing or two about what just happened.

As perhaps a few students have experienced over the years of University life, curing an awful hangover with more booze might work for a day or two (or weeks, as Fresher's Week taught us), but the nasty, horrible hangover will return - worse than before.

"The Hangover is not the problem. The Party was." - Johan Norberg

What a bum, saying yesterday's epic party was the problem! How dare he? Luckily, he's referring to the economy and its crisis witnessed over the last few years rather than your fabulous party.

The US government created the largest financial crisis for generations by lowering interest rates, the economic equivalent of free shots to everyone. The political purpose of 'every american a home owner', made sure the government buddies Fanny & Freddie bought every mortage loan available, no matter how risky or insecure that mortage was (that is, book U2 and Green Day for your livingroom party - someone else's dad will pay for it). On top of that, we had the issues of foreign currencies streaming into the US, that is; invite everyone you know. All set for an epic party, right?

When we all woke up from that heavy hangover of ours, we found ourselves in a weird situations; our economies didn't work properly. We had debts all over the place - and nobody to pay for them. Clearly, that bum's dad didn't pay U2 enough, now we're all screwed!

Today, in 2013, we're still deep down in debts. Most Western governments run major budget deficits (Pay for the booze with your credit card), and the UK Government figured they'd do something about the expensive Housing Market. Clearly, those venues for your crazy party ideas are a bit too expensive, are they not? Earlier this year, Help To Buy was introduced, as a way of "helping young people onto the property ladder" - by providing them with free loans for the first 5 years, and taking on responsibility for 20% of the mortage value.

Absolute rubbish! How do you think we got into this mess to begin with?

A Crisis caused by too low interest rates, perverse government intervention and mortgage loan for everyone, CANNOT be solved by LOWER interest rates, MORE government stimulus and MORE mortgage loans. 

Ask any student if more drinks will solve that horrible hangover. I guess even governments like to keep partying.


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Financial Times has a nice run-through of the Help to Buy Scheme.

I absolutely recommend Johan Norberg's book. It will blow your mind

Seminar Time - And the tendency of intervention

As I take the introductory course of Public Policy here at University of Glasgow, I also attend the weekly 1-hour long tutorials in the course. To be fair, put aside all the obvious objections I have towards this subject, its lecturers and the ways in which  it is taught, the Tutor of my neat seminar group is great. She openly displays her opinions and always let us discuss freely our own ones. Shame time is such a scarce resource.

Naturally, as most of the group consists of sociologists or students of other social sciencie, the tendency is very much towards an intervetionist "The State Will Fix Everything" kind of idea. And, yet as natural, whatever comment I make disrups the status quo of allowable opinion, at times producing a war in that little room of ours.

Todays subject; Health Inequality. Appearantly, the percieved and measures "Inequalities" in health related areas in Glasgow are particularly interesting to sociologists due to the fact that they are heavily correlated to geography within the city. It even has given name to the international phenomenon of WHO.

Our tutor gave us the task of suggesting Policies to Solve this Problem (a future post will be dedicated to explain why it isn't even a problem to begin with). What types of policies did my wonderful group come up with?

1) Regulations
2) Tax on unhealthy food
3) redistribution of income

It's gotta be a good life these keen supporters of public policy have. The answer to EVERY question is STATE INTERVENTION or STATE REGULATION. It's a bit like listening to Keynesian Economists, their magic trick being INCREASED SPENDING.

It's a funny world we live in.

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Oh, btw!

During this mornings lecture (Time of first Thatcher critique: 22 minutes) we were fed the faulty socialists' concepts of transforming correlations to causality; Health in Glasgow, we were told, are appearantly determined by 1) Race, 2) Gender, 3) Social Class 4) Geography and OF COURSE the almighty Income (and Income inequality). Funny that, I had the impression determinism was long ago considered a bit out of fashion, if you'd like. That individuals make choices, preferes DIFFERENT THINGS was of course readily discarded as some black magic Mumbo Jumbo. Funny.

Why Social Scientists need to learn math

Obvious statement: math is useful for a lot of things.

Yesterday morning I had an infamous lecture of Public Policy. It's interesting in the sense that you can predict the kind of socialist ideas that'll come out of it;

1. Thatcher was bad, 
2. Critique of Neoliberalism, 
3. The horrible effects of market economy

Yesterday was a special day in that the third was arguably not even included. However, the Professor did give a good start, critizising neoliberalism ideology after a mere 9 minutes of speaking. Even better, I think he set some kind of record; 4 minutes into the class, his first severe charge against Thatcher was laid. Impressive.

Not to say that this example means anything in particular, but I suppose it's fair to assume that Public Policy at University of Glasgow foster a rather strong hatred towards anything non-socalist, especially if it can be connected to Thatcher & Co.

Enough, what I wanted to convey today was the surprising lack of math insights and how that cripples the social scientists. This was his example:

Amount of UK Labour force in Manufacturing employment:
1978      28,5%
2009      10%

Conclusion; only a third of the people who worked in manufacturing 30 years ago, remain in that industry today.

Wait. Read that again.

Ok, well, no. First of all, people change jobs. They can change occupation/exit or enter industry, especially over a 30 year period. Second, a fair share of the people employed in 1978 will have moved on to enjoying a life of retirement by now. But 10/28,5 = 0,35, so the math still works out, doesn't it?

Math issue: between 1978 and 2009 the population (and the distribution of people in working age) have changed significantly. Thus, if inputs in a %-figure changes, the output changes. That is, 10% of the Labour force in 2009 is most likely not 1/3 of 28,5% of the Labour force in 1978.

Additionally, I've even stopped being suprised of the cases where people misuse Percentage for Percentage Point, ending up with completely flawed conclusions. My point here is that social scientists tend to have a limited understanding of math and what affects the numbers (especially regarding %). And, as they use statistics and math in describing their field, they inevitable end up with flawed or unsupported conclusions. That's a serious issue, heavily diminish the value of their study, should this be a theme for a larger part of social scientists. Let's hope it isn't.

If you're to use math or statistics, you need to understand what comprice and influence them. If you don't, you'll end up misinterpret data. Some kind of "know-thy-limitations" argument, I guess.

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This lecturer also gave me some idea to why there are so many socialists in University environment - and what happens to them afterwards. Well, in his case, some of them seem to remain at Uni, teaching Public Policy (or some other fluffy subject like sociology).