S**t my economist says #11

Economist overboard!

Its been a weird couple of weeks for Paul Krugman. First he popped up on CNN to speculate that the threat of an alien invasion of earth might be good for the economy. Lots of scope for Keynesian stimulus spending on ray guns you see.

Then he was forced to take to his blog to deny that that following the recent earthquake on the eastern seaboard of the United States he had said

"People on twitter might be joking, but in all seriousness, we would see a bigger boost in spending and hence economic growth if the earthquake had done more damage"

The fact that many of the comments on that post on the now deleted Google + page of the fake Krugman were from Keynesians defending the statement rather undermines Krugman's indignation when he bridled at being called a cheerleader for destruction.

But his denial of the earthquake comments contained yet another far out statement from the whack economist

"Just to be clear: World War II was expansionary because it led to a large increase in public spending"

Lets leave until another day the argument that the act of destroying large sections of the planet's labour force and capital stock can in any conceivable way be said to exercise an "expansionary" effect on an economy you have to wonder where exactly Krugman has been for the past decade. And what has he been doing there?

We have had, along with the Americans, two foreign wars. Krugman's fellow Keynesian Joseph Stiglitz estimated the cost of just the war in Iraq at $3 trillion. How's that for stimulus?

The Federal debt ceiling was raised from just under $6 trillion in 2001 to nearly $10 trillion on the eve of the Lehman Brothers collapse in 2008. A massive stimulus and the economy still tanked.


Federal debt ceiling

So Krugman's prescription for an ailing economy is a massive dollop of stimulus spending. That's it. The same thing, in other words, that was being done to the economy as it hit the wall in 2007-2008. Maybe Krugman should stick to Space Invaders.

Go West, young man!

On the wrong side

I'm in the United States and one of my holiday reads has been has been David McCullough's excellent '1776', a wonderfully written history of the first year of the Revolution, or Rebellion, depending on which side of the Atlantic you're from.

McCullough, a Pulitzer Prize winner, has a gift for character and is helped by those left by history to populate his story. Two of the characters in '1776' are particularly striking. On the American side you have Major General Nathanael Greene. On the British side you have Captain John Montresor.

What is striking is if you look at both men a little closer. Greene, aged just 33, was a self educated foundry owner on the outbreak of the war. Montresor, by contrast, had over 20 years military experience behind him fighting in North America in the Seven Years War (or French and Indian War depending on which side of the Atlantic you're from), with Wolfe at Quebec, leading expeditions and building fortifications "from Boston to Detroit to New York City".

Yet Greene was a Major General and Montresor a Captain. As McCullough writes

"If the desperate American need for leaders had thrust young men like Nathanael Greene into positions beyond their experience, the British military system, wherein commissions were bought and aristocrats given preference, denied many men of ability roles they should have played"

Two and a bit centuries later little has changed. True, the USA has seen the rise of powerful dynasties such as the Kennedys, Clintons and Bushes but a Ronald Reagan, a Bill Clinton or even, dare I say, a Barack Obama or a Sarah Palin, can still rise from origins like Nathanael Greene's to shape the nation.

Britain, on the other hand, remains almost as crusty and ossified as it did in the reign of King George III. Efforts have been made to remedy this malady. The most successful were the Whigs. They generated the wealth which allowed the Tories to paint the planet Imperial Pink and but were still sneered at.

Next came the early socialists. Despite initially noble intentions they failed to see how their ideology would simply replace one elite with another leaving them with the same ossifiaction, just with different people. And given how many Labour leaders from Clement Atlee to Ed Miliband were thoroughly posh even the faces changed little.

Finally came Maggie Thatcher (who Milton Friedman always saw as a 19th century Whig anyway) who's attempts to convince the working and middle classes that there was no shame in seeking to be as rich as the upper class drew horror from Tory toffs like Lord Stockton. In the end they did for her.

So Britain remains, as it was when the expertise of John Montresor went untapped, a place where who you know matters more than what you know. In the USA, which cast this off in 1776, the difference is exhilarating. For the ambitious and talented the advice of the 19th century newspaperman Horace Greeley still holds; Go West, young man!

The birth of English history

The daddy

‘What Is History?’ E. H. Carr asked in the title of his famous book. Nothing objective, he argued, saying, “The belief in a hard core of historical facts existing objectively and independently of the interpretation of the historian is a preposterous fallacy, but one which it is very hard to eradicate.” Several decades later, Richard J. Evans responded with ‘In Defence of History’ and argued the opposite.

It’s not taking sides in this ongoing debate to say that once upon a time, what we now know as history – a lineal narrative of cause and consequence consequence – didn’t exist. When Thucydides sat down about 400 years before the birth of Christ to write his ‘History of the Peloponnesian War’, his chronological ordering of events was a radical break with what had gone before. There was a city called Troy and there was certainly some fighting around it but the account of the Trojan War given by Homer in ‘The Iliad’ was mostly myth. Even the ‘Histories’ of Herodotus, written about 40 years before Thucydides put quill to parchment, have a confusing, scattergun approach with chronology largely absent. Quite simply, Thucydides marked a quantum leap in the documentation of experience: the birth of history.

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Big government has destroyed a healthy society and created an underclass

To describe the rioting that took place in the UK recently as “anti-social” sounds so anodyne as to be redundant. Neighbourhoods were terrorized. Buildings were burned. And people were killed. But it still conveys an essential point.

One of the most noted aspects of the riots was the fact that the rioters were destroying their own communities. Whatever this may say about the intelligence of looters who target Tottenham over Knightsbridge, the riots were certainly an attack on society in the areas they live in. Why would they do this?

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The wet shoe diaries

"A man's got to know his limitations"

King Cnut is remembered by history for pulling up his throne on the beach, ordering the sea back and getting his feet wet. His attempt to assert royal power over the forces of nature was a soggy failure. Policy makers in Europe and the US are currently engaged in a similar exercise; standing at the seafront ordering the economic tides to recede. They are unlikely to have any more success than the old king.

In Europe and the US the issue has become sovereign debt. In Washington the problem is the rapidly growing amount of it. That is also the problem in Madrid, Lisbon, Dublin, Athens, Rome and, scarily, now Paris too. In European capitals the debt issue has been exacerbated by the additional question as to what extent a shared currency means shared debt liability.

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Do Republicans want a freedom loving candidate for the White House or not?

In referring to beauty contests, John Maynard Keynes once famously said: “It is not a case of choosing those which, to the best of one's judgment, are really the prettiest, nor even those which average opinion genuinely thinks the prettiest. We have reached the third degree where we devote our intelligences to anticipating what average opinion expects the average opinion to be.”

Ron Paul might not agree with much that Keynes wrote but, applying this insight to his presidential election bid, he might well manage a wry smile of agreement.

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London rioters are the pampered children of the welfare state

A bit more of this

For the last two nights, like many other Londoners, I have stayed up late watching clashes outside my window between Police and rioters. After seeing the burned out flats of Tottenham I wanted to make sure I could go to sleep safely.

What I saw, a Police car being trashed and a baton charge on Sunday and fighting again last night, was rather subdued by the standards of elsewhere in the capital. Following on from the arson in Tottenham, buildings were burned in Hackney, Croydon and Ealing.

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Riotballs

A woman in Croydon has to jump from a burning building. Its society's fault apparently

In fairness figures on the political left have been resiting the temptation to try and make out that the riots in London, which claimed their first life today, are anything more than rancid criminality. However, the loonier lefties, who in their desperate search for allies have yet to encounter anyone giving off a moral stench so gut turning they weren't able to stand it, have seen in these feral scum noble, oppressed harbingers of the proletarian rising. Here's some examples from a couple of the nuts I came across in my undergrad days...

Sean Rillo Raczka has been tweeting prolifically...

"People have lost their homes. It's tragic. The government is putting many many more on the streets though. People won't accept this #riots" - Today

"I can see increased stop and search, violent policing and the deployment of water cannons coming from all this, not the justice that we need"
- Today
"Inevitably this chaos will lead to further victimisation of poor young people, and even worse militarised & political policing." - Today

"Govt systematically disenfranchises young people, giving them no hope or education. There is endemic racism. I wonder why there are riots?" - Sunday

A friend has posted on his wall...

"COMRADES... REAL RΞ√φƱϮỊΘƝÅRỊΞS... WE NEED TO GET ON THE STREETS TOMORROW. YOUNG PEOPLE... FORGET THE LOOTING, IT'S A TRAP!!! TARGET GOVERNMENT BUILDINGS, POLICE STATIONS, BANKS, BETTING OFFICES... IT'S TIME TO MAKE A STAND... THIS IS IT.
YOU ARE... MALCOM X, JOHN LENNON, CHE GUEVARA, MICHAEL JACKSON, NANNY MAROON, TUPAC, ANGELA DAVIS, JESUS, LAURYN HILL! ♥"

Ordinarily you'd take this for a joke...

Elly Badcock, previously mentioned here, has been a fountain of revolutionary fervour in Facebook

"just got back from tottenham. scary stuff. the anger pouring out from a marginalised community against a corrupt police force is something to be reckoned with" - Sunday

"The bullet lodged in Tottenham PC's radio is apparently police-issue. Looks like that set-up fell through, then. Fucking murdering bastards." - Sunday

"This from Jo Gough who was around Hackney and Whitechapel last night: "my experience of wandering around: people are targetting corporate shops- overpriced goods and exploit their workers, and banks- made this crisis. A mixture of all ages and people, no violence against eachother. We have to understand people can't carrying on living with no money and no future prospects apart from the govnt saying we will become poorer. The system is way more violent than anything happening on the streets" - Today

In the real world here are Raczka's and Badcock's downtrodded heroes striking a blow for freedom and justice...

When hate came to town

At quarter past two you could see the Police helicopter swinging wide loops in the sky over Whipps Cross at the far end of Hoe Street from Walthamstow. The grand old shell of Alexandra Palace to the left, the emerging shell of the Olympic Stadium to the right. Straight ahead, along the narrow spur of track, the helicopter and Walthamstow, my home.

Walthamstow Village gets its name from being the little acorn from which Walthamstow grew. It gets its reputation from events such as the Craft Guerillas Market which was being held this Saturday afternoon in the Orford House Social Club, a sprawling, slightly run down building set back from the tree lined road. The club, like all clubs from snooker to Conservative to Miners Welfare, is valiantly kept going in the face indifference for a dwindling band of patrons by one or two fanatically committed people. With its high ceilings, large sash windows and white paint job the place must be a money pit. Out back are the bowling greens, still immaculately manicured and overlooked by modest old houses. In the July sun you could be forgiven for thinking you were in a Britain of the past, a Britain that still cared about places like the Orford Road Social Club.

The people attracted by the craft market did. One seller had her hair pinned and curled like Lana Turner. A baby suit had a retro picture of a spaceman and on the stage was a stall selling lampshades made of old fashioned wallpaper. All of it was ‘crafted’, made by the people selling it who each had a specialty; one did soap, another pottery, another sleep masks. These people weren’t just harking back to the style of the 1940’s but its attitude too, one of make do and mend, of self-reliance from a previous age of austerity, when even Walthamstow could find a place for crown green bowls.

Walking out and down West Avenue the helicopter was buzzing much closer overhead now, perhaps over the junction with Lea Bridge Road? Its tinny drone was pimpled by the sound of an Ice Cream van making its rounds.

I turned left on to St Mary’s Road. It was on this road not long ago that I saw an old woman skittled by a young boy charging along the pavement. “Excuse me!” she complained “Fuck you!” had come the reply through a thick accent. On one side were railway cottages on the other a row of shops turned, rather inexpertly, into flats. Just visible through the faded white wash you could make out the words ‘Fish Bar’.

At the end of the road are some steps which take you up to the crossing by Walthamstow Central station. I could see several Asian guys stood around, arms folded, waiting. The helicopter was closer. Reaching the top of the steps you can see down Selborne Road. On a clear day you can see the twin spires of the Catholic church on Seven Sisters Road or, even further across north London, the green dome of the church next to Waterlow Park.

Today was a vista of one Police van after another punctuated by crowds of loitering Asian kids and bemused shoppers. Looking right the turn towards Chingford was also choked with Police vans. Looking left was a glut of buses cresting the bridge over the railway track trying to turn into the station. The helicopter was almost directly overhead.

I crossed the road to The Goose, once a hotel now a grotty pub which sells grotty beer to customers too wasted on other substances to notice. A cluster of Police were outside paying close attention to a group of about seven men and one woman standing outside where the smoking is usually done. The leader was a stout man in a West Ham shirt, his goatee the only hair on his egg like head. On his wrist was a gay rights bracelet. He was no racist; he was a concerned local resident he said. His claim to be an outraged ingénue could not be repeated by the man and woman (his wife?) next to him who had brought boards with slogans including “TRUE MUSLIMS DON’T PROMOTE MURDER AND HATRED TO THOSE THAT FEED THEM” The rumour had been of a counter protest by the English Defence League. Maybe these few people, all early middle aged, were it?

At 3pm on the button the protest that had provoked the counter protest came round the corner onto Selborne Road. It was 61 members of Muslims Against Crusades who had marched from Leyton tube station. The Police worked hard to keep the two groups apart. A young Asian with a full beard was ushered across the road away from The Goose and to the station side which was full of increasingly excited Asian youths.

This sort of thing is no longer unusual in what was once a bastion of the white working class represented in Parliament by Clement Atlee and made famous by E17. Back in 2006 then Home Secretary John Reid was confronted in Leyton by a man demanding to know “How dare you come to a Muslim area?” This last week reports came of stickers going up in Leyton declaring “You are now entering a Shariah controlled zone” where there would be ‘no gambling’, ‘no music or concerts’, ‘no porn or prostitution’, ‘no drugs or smoking’ and ‘no alcohol’ and threatening “Islamic rules enforced”. One of the men who put these posters up, a white convert with a striking ginger beard named Jamaal Uddin, was on the march.

As bad as this is there is a still darker side. In 2005 Abdul Muhid was arrested for giving a speech at the end of the market calling for the killing of British soldiers and homosexuals. In 2006 two men from Walthamstow were among three later found guilty of plotting to blow up transatlantic flights. I was in the barbers on Forest Road the weekend after those arrests and the barber said to a waiting regular “Yeah, I knew ‘em. Nice lads, used to come in ‘ere”. It was odd to realize you lived so near people who were working to kill you.

Now, this Saturday afternoon, the two groups were now within shouting distance of each other, a fact they made full use of. “Muhammad was a pedophile!” chanted the man with the boards pleading for true Islam to win the day. “Keep St George in my heart keep me English” they sang, chanting “Scum, scum, scum” while they waited for one of their number to strike up the next song.

The response from the more numerous MAC protestors with the aid of a loudspeaker came back; “Shariah for UK” and “What do we want?” “Shariah!” “When do we want it?” “Now!”

As MAC passed the pub the crowd of Asian youths on the station side, which was about twice as big as the demonstration itself, began cheering wildly. Unlike the protestors who, this warm summer afternoon in east London were dressed in the long robes of medieval Arabia, the supportive youths were kitted out in all manner of designer gear. Apparently the hated infidels produce some natty threads.

“My old man fought a war for you to have freedom of speech” shouted the egg headed man, seemingly unaware that as rancid as the views expressed by MAC are his dad fought for their right to say it.

The response from the youths on the station side was to chant “EDL scum” to which egg head’s friend replied “Who’s EDL? We live here!”

And then the flash point was passed. It doesn’t take 61 people very long to file past seven people and they were led on past Tescos into the town square.

Walthamstow town square lies between the bus station, the market and the Mall. Often it hosts a farmers market or a French produce market. There is usually some entertainment, frequently the same Peruvian pan pipe players I heard coincidentally on consecutive weekends in Sheffield and Harlow playing El Condor Pasa both times. There is a large screen, erected at great expense by the council, which, today, was showing golf.

There are usually competing tables of left wingers, you can take your pick of Socialist Worker or Socialist Alliance but never the twain shall meet. They often protest about the west’s wars of aggression but they stayed home today. There was a small protest next to the Nat West by the McGuffin’s, the local cinephiles trying the get the cinema reopened, about ten members of the Apostolic Church singing hymns under a small marquee and a fun fair with a merry go round which was doing good business with the excited children of the afternoon shoppers.

Then MAC came advancing over the small carefully landscaped hills. The reaction reminded me of Jaws, when the boy gets munched in front of a crowded beach. People who had been watching their children play or queue for the fun fair shouted their kid’s names, stretched out their hands, and seized them. As the merry go round came to a stop a young girl looked with fear at the black clad, flag waving, chanting mob coming towards her before her mother scooped her up.

The problem was as much the crowd of teenage hangers on who had gathered round the hardcore MAC crowd. They were the same very western dressed ones from opposite the pub, I recognized one guy in a horrifically tacky shirt which had Manchester United’s badge on it in sequins. The trimmed grass of the town square often has people sitting, chatting, sunbathing or sobering up especially on a warm day like this. With the approach of the crowd, fired up by their exchange with the drinkers in The Goose, bags were packed, shoes slipped on and retreats beat. The Police seemed to struggle to keep up.

A steward brought MAC to a halt in front of the TV screen and the hangers on fanned out around them. A speech began but attention flashed back to the bus station where a group of Asian kids had decided to run back to the pub to confront the drinkers. The Police stopped them and a scuffle followed. People trying to get their shopping from the market or Mall to the bus station were scared out of their wits. As the fighting died down as quickly as it started one of the Police said that one of the Asians has been smoking a spliff and another on a march who’s ultimate aim is supposed to be modest behavior began shouting “Fuck your mum” at the Police. I wondered how long any of these kids would last under shariah law.

The hangers on drifted back towards MAC where a very immodestly dressed girl in a tight, short green dress came over and said hello to some of them she appeared to know and stayed chatting. Some others jumped on the now closed merry go round and started kicking it. The promised enforcement of Islamic rules seemed rather arbitrary.

The speeches continued over by the big screen but were drowned out by the golf commentary. The first speaker, another white convert, gave a long, rambling speech which jumped without coherence from Iraq, to MP’s expenses, to the credit crunch, to the naked women who he apparently encountered on every street corner. His tone was more consistent than his content, resolutely hysterical, so much so that his voice gave way under the pressure and cracked, breaking into a high pitched squeak as though he was reverting to pre adolescence.

I scanned the signs held by the MAC protestors behind him; ‘Islamic Emirates for Britain’, ‘Democracy = Hypocrisy’, ‘Muslims Rise, Defend Islam’, ‘Establish Islamic Emirates’ and ‘Shariah: Solution to all problems’. I wondered if the man (and they were all men) holding that had ever heard of the hell of life under the Taliban? Another sign read ‘Jihad Against Christian Extremists’. A few feet away the members of the Apostolic Church, surrounded by febrile youths, held each other’s hands and prayed.

Then came the main event, a speech by self-styled bogeyman Anjem Choudary. He was mercifully brief in his remarks, he simply repeated what the previous speaker had said and what the speaker after him would say; Britain is, apparently, drowning under a deluge of drink, drugs, porn, gambling, prostitution, Hollywood movies, fashion and cosmetics. It was a rambling list of things he didn’t like the presence of which apparently means that we are worse off than Iran or Afghanistan under the Taliban. Indeed, public enemy number one was distinctly underwhelming. The only impressive thing about Choudary was his insistence on wearing such heavy clothing on a warm day.

The hangers on seemed to have found the speeches as dull as I did. As soon as Choudary had finished a group broke away back up to the station. It was 3:39. By the time I got up there a couple of Asian youths were being arrested. I asked a Policeman next to me how he felt it had all gone. “Peaceful” he replied as over his shoulder I saw a group of the hangers on abusing a lone cyclist.

I wandered back down to the town square toying with the idea of heading home. When I heard the same old prattle about drink and porn, which MAC seems as obsessed with as the most onanistic teenage boy, that settled it. But as I turned to leave I saw two of the younger MAC members, looking like something out of Star Wars in their flowing black robes, talking with two white guys and a girl in jeans and a headscarf. I edged over to listen.

The MAC guys were playing the same riffs, porn and its alleged ubiquity cropping up again. The younger of the two was spitting out words at machine gun speed and clearly not bothering to vet them mentally. The familiar words, corruption, prostitution, porn, drink, drugs, crime, Iraq, all fell out pell mell. But no attempt was made to explain how any one of these things was related another. Like Choudary, they simply assumed there was no problem for which Islam was not the solution, it was their silver bullet. As a result they see no need to think through any of it. Say the word Islam three times and click your heels and you’ll be in the Promised Land. But you might get stoned to death when you get there for wearing ruby slippers.

It was all less obvious to the listener. Every now and then he tried to ask the younger MAC man a question only to be told “You’re not letting me speak”, pretty rich coming from the kid whose inchoate ramblings had taken up 80% of the ‘conversation’. He launched back into another riff on the evils of western civilization then cited approvingly the NHS which, as his listener pointed out, was a product of the very western culture he claimed to hate. The younger MAC kid paused, appeared to consider this point, then said “You’re not letting me speak…” and launched back into something about pornography.

That was it for the guy who told his two friends he had had enough and wanted to leave. The younger man again complained “You’re not letting me speak” which was too much even for his older MAC colleague who told him to shut up. As the three walked away the girl in the headscarf was told that hanging out with two westerners was Haraam. She left with them anyway. The two MAC guys were left alone and the older one turned to his younger mate, exasperated, and said “What are you doing?” The other demonstrators were kneeling below the golf coverage and praying towards Leytonstone.

This is what happens when you indulge scumbags

Take that bus!

Tottenham, just a couple of miles from me, is in flames again. The people of N17 are following in the famous footsteps of the Broadwater Farm rioters of 1985 and smashing up the area they live in to "protest" about the shooting of Mark Duggan by the Police at nearby Tottenham Hale tube station on Thursday.

But its always a little difficult to take these riots seriously as some expression of outrage on the part of the oppressed. Like the equally dumb Rodney King riots in Los Angeles in 1992, a great many of the outraged and oppressed are registering their anger with an apparently racist/capitalist/patriarchal Police force by grabbing some flat screen TV's and Blu Ray players.

The fact is that some people, like those rioting by Bruce Grove train station, are just scum who like a row. When the student protests turned violent a few months ago I was asked by an angry student "Do you think people do this for fun?" Yes, actually, I do. The blokes I see scrapping at football matches don't, despite the valiant efforts of underemployed sociology lecturers to convince you otherwise, do it for some grand political or social reason. They do it because some blokes find having a scrap exciting. And the scum rioting in Tottenham couldn't give a monkeys about Mark Duggan, they just want a row. And some free electrical goods.

These scum don't need much encouragement but it has never helped that there have always been left wingers willing to see in this mindless destruction the stirrings of a revolutionary proletariat. There will be, in the days to come, people telling you that all this is a reaction to 'social exclusion' or poverty. And this matters because these people have an influence on policy out of all proportion to the value of what they have to contribute. Seeing the wrong problem they have for years peddled the wrong solutions. Less active Policing and a bit more taxpayers cash will, apparently, solve the problem.

And these lefties, along with the various self appointed 'community leaders', will come to blame the fact the area is a dump which 'socially excludes' its residents on some failure of the market economy or a government which doesn't care about them.

Tottenham won't be a dump for either of these reasons. It will be a dump and remain a dump because of the rioting scumbags of Tottenham. The people who, in the name of 'Justice', and IPCC actually started an investigation before Mark Duggan's body was cold, have smashed their own shops and amenities and burned their own neighbours out are the ones who will be to blame for the fact they have no shops or amenities. The same thing happened in areas like Watts and Detroit after the riots there in the 1960's. The residents smashed the place up and then complained that they lived in a ruin.

Lets not dignify the destructive morons of Tottenham with some concocted socio-economic rationalisation. This just encourages people who need little encouragement and by distorting policy makes the situation worse. But let them endure their punishment. When they look at the dump they live in remind them, when they cast the blame on capitalism or politics, that its a dump because they smashed it up. To wallow in their results of their own stupidity should be their reward. The tragedy is that victims of the scum are not 'the Pigs', 'the Man', 'the Feds' or whatever imported American term they choose to use. The victims will be their innocent neighbours.

Econogeddon!

There goes the kids trust fund

“It's only when the tide goes out that you learn who’s been swimming naked”. So said Warren Buffet of recessions. The credit crunch revealed that much of the western world had been skinny dipping in debt for years.

Initially they protected their modesty with stimulus but the limits of that have now been reached. The disastrous performance of stock markets around the world in recent days shows that the western economies are now splashing naked between the European Scylla and the American Charybdis.

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S**t my economist says #10

Federic Bastiat - Wiseguy

I know a guy who is very, very vocal on the issue of the deficit. He thinks it should be closed entirely with tax rises. He has even said he is willing pay a few extra pounds to safeguard those vital public services.

But when his fuel tax went up he went crazy.

Another friend of mine is also very vocal about the coalitions plans to deal with the deficit. Again, it should all come from tax rises.

She has now got a council tax refund of which she plans to donate not a penny to supporting those vital public services.

Indeed, one of the things you notice first about the people who think taxes should be raised to close the deficit is that they almost invariably mean that somebody else's taxes should be raised to close the deficit.

Or as Federic Bastiat put it "Government is the great fiction through which everybody endeavors to live at the expense of everybody else"

What's a guy to blog about?

Ed Miliband channels the The Temptations' Melvin Franklin

Its been a few days now since my last post. That's not because nothing has happened, quite a lot has and is, its just that I feel like Ive written about it all before. That's not because of any great predictive powers on my part. Its just that the political and economic policymakers I write about most seem stuck in the same ruts.

Take the euro. A little over a week ago the European Union agreed to a second bailout of Greece on the questionable logic that if a cure has failed the best thing to do is try it again. Markets rallied and the crisis seemed to have passed.

Except it hadn't. As Ive written again and again and again and again the euro is a project with fundamental economic flaws, a fact which no amount of wishful political thinking or borrowed cash will change. To prove the point the last few days have seen rising yields on Spanish and Italian bonds and fresh crisis, the very outcome we were told the most recent bailout would avert.

Opposite the Scylla of the eurozone crisis we had the Charybdis of the near default of the United States. President Obama has been blamed by the right for the ballooning spending but, as Ive said before, the Bush administration kicked off the current orgy of debt. This, as I have also written previously, shows up how empty all the rhetoric about 'change' was. The only 'change' is that Obama borrows more than Bush did.

What do we see domestically? The economy continues to be sluggish but given the extent of deleveraging going on this is only to be expected. Indeed, I have previously expected it to lead back into double dip towards the end of this year. There isn't much George Osborne could do to avoid this and despite what Ed Balls says he would only make it worse. On the bright(er) side, the economy wont pick up properly until this happens.

So we come to the one area where perhaps there is room for me to, not only say something new, but do it in between mouthfuls of humble pie; the renaissance of Ed Miliband as leader of the Labour party. I've mocked Miliband though I'm hardly the only one, and he does make it so easy when he turns up at marches comparing himself to Martin Luther King or giving the funniest interview of all time. Indeed, Ed's comedy antics saw him getting an 'excellent' rating from just 22% of Labour members while 53% thought he had been "Poor or Very Poor".

Then came 'Hackgate' and all was changed, changed utterly. Labour supporters hailed "The emergence of Ed Miliband Mark II" or crowed that "his courage in putting his neck on the line to take on News International has vindicated the trust that I and a majority of Labour's Electoral College put in him last September"

But a week, a famously long time in politics, is an eternity in the Labour party. Today saw reports that Miliband wants to weaken the power the trade unions have over Labour party policy. A sensible enough idea (though those are no more fashionable in the Labour party now than they ever were) but one that sees those won over so recently warning darkly that "Ed is playing a dangerous game" All is changed, changed utterly. Again.

But, again, there isn't much for me to write about here as I've already said that "Ed Miliband was an incompetent party leader before 'Hackgate' and 'Hackgate' hasn't changed that. After its done Ed Miliband will still be an incompetent party leader"

This isn't to say I told you so or to claim the power of second sight but simply to reflect on how our leaders insist on repeating their obvious mistakes. Whenever they do something daft you find they did exactly the same thing fairly recently and that it was just as daft then whether it be bailing out busted Mediterranean countries, running another trillion dollar deficit, or changing your mind about Ed Miliband.

Marx said that history repeats itself "the first time as tragedy, the second time as farce" He was doubly wrong. You don't have to wait for something dumb to become shrouded in the fog of history for someone to repeat it and it can be worse than farce; it can be a dull Sunday afternoon repeat of Poirot. Personally I think The Temptations had it more right than Marx

Air pollution, revolution, gun control,
Sound of soul
Shootin' rockets to the moon
Kids growin' up too soon
Politicians say more taxes will
Solve everything
And the band played on
So round 'n' round 'n' round we go
Where the world's headed, nobody knows
Just a Ball of Confusion
Oh yea, that's what the wold is today