ASI Bulletin: Seoul-mates
Dr. Eamonn Butler, our Director and Co-Founder, takes you through the last few (always hectic) weeks at the Adam Smith Institute.
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A whole bunch of stuff in the e-Bulletin this time. My world travels, who’s leading in the Smith-Keynes-Marx stakes, why we should auction visas, our new patron, the Next Generation, migration, AI, housing, and a lotta other good stuff.
BUT FIRST…
I’m just back from speaking about Adam Smith in Korea and Taiwan, so forgive me if I fall asleep sometime before the end of this bulletin. I also haven’t been keeping up with the news, but let me guess what’s happening: Blob out to get another cabinet minister; More rail/teacher/NHS strikes; New Boris scandal; Another Trump outrage; ChatGPT making up government policy; Police scrap all other duties to focus on hate crime; Inflation and interest rates high; ear of AI Armageddon; Penny Mordaunt hailed as the only person who can save Britain (these two stories are not necessarily related); Tories fixing prices, nationalising industries and generally alienating their own supporters. Am I right?
I was glad, though, that I didn’t arrive back just as the UK’s passport gates all seized up. Someone should tell Border Farce to read their F A Hayek. Then they might understand that system-wide centralization tempts system-wide mess-ups. (Come to think of it, maybe the government should read their Hayek too.)
WELCOME TO THE UK…
Actually I cheated on the rail strikes thing because there’s one going on as I write. And the FA Cup (or whatever questionable sponsor’s name it’s called by these days) and I see the Derby are going to be splattered too. I think the union leader Mick Lynch must be a class traitor because he’s obviously familiar with The Sloane guide to ’The Season’ and is also planning strikes over the Henley Regatta, Wimbledon, the Polo Gold Cup, Cowes Week, Goodwood, and the Burleigh Horse Trials.
In a carefree moment, I asked my friendly neighbourhood chatbot to write an obituary of me. Rather disappointingly, it said that it could "not write an obituary for Eamonn Butler as he is still alive". So I asked it to write an obituary of socialism. Equally disappointing, it told me that that is very much still alive too.
But I digress...
DO-TANKING
As I say, I was in South Korea to give a couple of talks about Adam Smith, his 300th birthday coming up in a week... or two (there’s a dispute about which is the right day). Royally looked after by the city of Jinju, which is to entrepreneurship as IronBridge is to the Industrial Revolution, the founders of Samsung, AG and LG all having been born in a little village on the outskirts and having attended the local primary.
Then on to Taiwan, where the locals tell me they fear three natural disasters: typhoons, earthquakes and the Chinese. A sort of gallows humour, I guess. Liz Truss is right, though. We need to hang tough. Oh, and my friend and translator Lee Sung-Kyu gave me a nice scroll with ’Theory of Moral Sentiments * Wealth of Nations’ written on it. (If I’ve got it the right way up, that is.)
Who is winning: Smith, Keynes, or Marx?
That’s the question that Prof Mark Skousen of Chapman University will be asking here on the evening of Tuesday 6th June. It’s kinda sold out but wrap a cheque around an email and send it to events@adamsmith.org and see what might happen.
New report: Optimising for our Openness
Let’s face it, the current UK visa system is complicated, inefficient, and a cause of stagnant living standards and rising taxes. Our solution—and one that was endorsed by Nobel economist Gary Becker—is to use the market (Quelle surprise!—Ed.). We say employers should be able to buy visas for the foreign workers. Visa auctions will ensure that those who are admitted are the workers who will bring the most economic value to the UK. (And some can be reserved for those professions of high social value too.) The authors believe this system would hold immigration constant while generating £59bn in revenues, allowing income tax to be reduced by 11p in the pound. And he suggests a trial to issue visas by examination—to boost innovation here in the UK. Here’s Connor in CapX on that same paper.
Shrinking the blob
There’s a scene in Jurassic Park where the hunter is stalking the dinosaur, only to discover, fatefully, that the dinosaur is stalking him. Well, it’s a bit like that with the Whitehall civil service. Flushed with success, they are looking for their next cabinet scalp. Unfortunately we have armed cabinet ministers with a manual showing how to scalp them. It’s a thorough tome by management guru Tim Ambler and there are chapters on how to streamline every ministry—keeping the core policy staff but shunting the delivery out to executive agencies (and rationalising that lot too). Oh, and farewell to the quangocracy. Get your copy here, minister.
New ASI Patron
Former Education Secretary and Chancellor Nadhim Zahawi has joined ASI as a Patron, saying that “the answers to many of today’s challenges can be found in the timeless wisdom of Adam Smith” and praising the Institute for effectively promoting such ideas in the public policy debate. Watch this space: over the next year, we will be welcoming new patrons, staff and fellows of all political colours (and of none) to ramp up our fight in the battle of ideas.
The Next Generation
Lord (David) Frost, former Brexit negotiator and keeper of the Tory Party’s conscience, who recently announced his intention to stand for parliament (Dead end job, that—Ed.), was our guest at the May Next Generation meeting of tomorrow’s movers and shakers here in Westminster. Among other things he was keen, given the young audience, to stress the need to free up the housing market and get housing costs down.
Next meeting: The next meeting of The Next Generation will be on Tuesday 13th June, where we will have a mystery guest (at least, it’s a complete mystery to me who we’ll get). No mystery, of course, about the fine reserve wines and designer mineral waters that we’ll be serving, as usual. Email events@adamsmith.org.
On the blog
What price caps achieve. Not much, according to Madsen Pirie. Responding to the government’s daft proposal to cap food prices, he kindly refers to my book Forty Centuries of Wage and Price Controls to show that throughout recorded history, price controls always boost consumption but dry up supply, leading to shortages. Sure, you can make bread cheap, but that’s not much use if there’s none to be had, is it? Why on earth do politicians keep recycling policies (rent controls is another) that have demonstrably failed over and over again? If you know, email me back!
An eye on AI. My friendly neighbourhood chatbot reminds me that in 2018, ASI produced a report entitled The Future of Work, which took an optimistic view on automation and AI, saying that they will create more jobs in the long term than they will put at risk in the short term. Of course, the chatbot could be making that up. Which is one of the wee snags with AI, according to Connor Axiotes, along with fears that unscrupulous programmers could use it to impersonate people, create bad stuff and so on. What we need, of course, is an evaluation of the various risks—from trivial to potentially catastrophic—and a regulatory system that doesn’t squash innovation by putting everything in the latter category. Watch out for our research report on the subject coming soon..
In the papers
The announcement that UK inflation fell to 8.7% is small comfort, wrote my colleague in the Daily Express last week. Much of the fall was oil price rises from a year ago (yes, Russia’s war again) dropping out of the index, buit underlying inflation is still high. Marlow blames the Bank of England’s profligacy in creating money and not moving quickly enough to restrain it. But when the government is desperate for cash to fund overspending on daft projects (Did someone say HS@?—Ed.) you can see why nobody in power bothered to complain. Time to tell the IMF to get lost, and cut taxes.
I don’t know what it is about the Daily Express that has my colleagues writing for them all the time, but our Connor Axiotes was also in it the other day, pointing out that immigrants do a lot of the jobs that the UK’s ‘economically inactive’ natives wouldn’t touch with mint-condition surgical tweezers. Immigrants, he notes, start businesses, create innovations, pay taxes and generally add twice as much to the economy as they earn in wages. Which is useful in our present over-taxed, over-spent, over-inflated state.
Also on the immigration issue, our policy supremo Maxwell Marlow has been in the i (What a silly name for a news organisation—Ed.) noting that by 2025 the UK’s population is likely to be larger than that of France, for the first time ever. Some of that increase is us taking in refugees from Hong Kong and Ukraine, and a lot more is from the small boats coming over from … France. (Well, at least we’re beating them at something!—Ed.)
As I say, they’re all at it. Now my colleague Dr Madsen Pirie is in the Express too, beating up the government’s well-intentioned but muddle-headed support for first time buyers, which drives up demand without increasing supply, fuelling price rises. Always even-handed, he also takes on Labour’s plan for local authorities to buy undeveloped land cheaply for their own building projects. Instead, he says, they should buy farmland (most of which has no public amenity at all) at a premium, then give it planning permission. That gives councils an incentive for development without annoying owners.
Brandom Lewis MP praises our work in theTimes on housing, ‘For the Conservative Party, there is also a political need to deliver housing. Why would the younger generation vote for a party that restricts their opportunities to become homeowners? Research by the Adam Smith Institute shows that there is a desire for home ownership among at least two-thirds of the population, despite the fact that ownership overall has long been in decline.’
And to top it off, Nadhim is back with a zinger on why inheritance tax is so so bad. ‘The most natural feeling in the world for any parent is to want to look after their children. This feeling is so powerful that it stays with us until our last breath, and even beyond; we all want to leave the world a better place for those who follow us, and leaving behind what we have built and earned in life is a crucial part of that.’
AND I QUOTE…
While the government is boning up on Hayek’s analysis of information systems, they might also have a peek at his 1960 book, The Constitution of Liberty, where I found this useful warning:
“Inflation is probably the most important single factor in that vicious circle wherein one kind of government action makes more and more government control necessary. For this reason all those who wish to stop the drift toward increasing government control should concentrate their effort on monetary policy.”
Come to think of it, I should send a copy to the Bank of England, too.
Bye,
e
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