BBC has failed to meet the moral standards it demands from others

It's gone like this...

Late TV star Jimmy Savile was a recidivist sex offender.  This was broken by ITV, following a report that the BBC chose not to broadcast a report about the very topic late last year, preferring instead to broadcast a tribute to the man.

The BBC denied it suppressed the report for any specific reasons associated with the content of the report.  The BBC also denied it had received complaints about Savile and that it had nothing on file.

Subsequently tens, then hundreds of people came forward with their stories of Savile.  One woman, who was molested on air under her dress by Savile, said she complained and was told "that's just how he is".  It is now clear that during the 1970s and 1980s, the BBC essentially had a culture of suppressing complaints of sexual abuse against high profile stars.

There are now at least two investigations into behaviour of BBC staff over this affair.  Of course, the question has been raised as to how the BBC can investigate itself.  After all, a core principle of the Leveson Inquiry is whether newspapers (which, it is important to emphasise, are not state owned, not state funded and not creatures of statute) can hold themselves accountable.   The BBC apparently can, so it thinks.

All of this did blow open the obvious questions.  Why didn't the press take on Savile when he was alive?  Why didn't the BBC?  What are the implications of the Leveson Inquiry, which may propose regulating the press in order to avoid overly aggressive behaviour in pursuing people for stories, on journalism in the UK?

Since then, the scandal widened. Labour MP Tom Watson, the MP who has been the key protagonist in taking on NewsCorp in the Leveson Inquiry and who firmly believes in regulating the press, has been alleging that there is a pedophile conspiracy involving senior Conservative politicians and officials from the Thatcher era.

The BBC didn't dare question Watson as to his motivations.

However, it did listen to one man, who told the BBC that a senior Conservative politician had sexually abused him.  The BBC reported this, without saying who it was, but the description and the internet saw Lord McAlpine identified within 48 hours of the broadcast.  The man who made the claim then withdrew it late last week because once he saw a photo of Lord McAlpine he confirmed that he had not been the abuser.  Apparently the BBC had not inquired of Lord McAlpine before issuing its report, and had not probed the man who made the claim, even though it has subsequently been revealed that the same man had made a false accusation against a policeman some years ago and has a history that should have given cause for the BBC to not proceed.

Of course some have implied that the BBC chose to jump at the chance to take the story away from its own inadequacies and cover ups, to blaming a senior Conservative ex.politician, especially after a Labour MP had talked about it.

The allegations against Lord McAlpine mean he is likely to sue for defamation, it has shown the BBC as not meeting the standards it thinks it embodies, by reporting the most damaging allegations that can be made against any man today (be clear, to be labelled a child rapist is worse than murder today) based  on the testimony of one man, without giving the accused the right of reply or even, off camera, talking to him.

Yet this is the BBC that claimed it did not broadcast a programme recorded about such allegations against a dead former BBC celebrity, because the evidence wasn't good enough.  

BBC Director General - George Entwistle - who only took on the job in September - has resigned over it all, not least because his performance when interviewed by BBC Radio 4 presenter - John Humphrys - was farcical.

Of course it isn't just the BBC that stuffs up.  On ITV, Philip Schofield handed David Cameron a list of  alleged pedophiles live on TV.  However, he's been excoriated and ITV now subject to an OfCom investigation.

Yet the BBC is not subject to scrutiny by OfCom - the regulator of the broadcasting industry.  It is subject to regulation by the BBC Trust - a body which is mean to provide oversight, but has no real sanctions against the BBC when it misbehaves.   It is hard to see how the BBC Trust can possibly address the fundamental failings of the BBC to confront Jimmy Savile, let alone be honest about what happened.

What is needed is an independent inquiry.

However, what it raises is more fundamental than the poor judgment of BBC management, which is getting to be rather too frequent.

It is the basis for the BBC's special status, as the only broadcaster completely protected from the recession, the only broadcaster legally entitled to force the public to pay for it, whether or not they consume its services.

The BBC is quite possibly the most powerful institution in the UK.  It is difficult to overestimate the pervasiveness of the BBC in British life, its profound influence on politics and culture, and its status within broadcasting and media more generally.

It holds this position because of legislation and its primarily funded through compulsion.  Indeed 140,000 people each year get criminal prosecutions for not paying the TV licence, an archaic, arbitrary poll tax for owning a TV.  A system that in itself particularly penalises the poor, those home during working hours and those who do not live behind gated homes or tower blocks.

It broadcasts 9 TV channels in the UK and 10 national radio stations with 40 local ones.  It is the dominant broadcaster and asserts impartiality and balance as central to its ethos.  It also claims scrupulous political impartiality and separation from politics.  Yet it is a creation of politics.

Those of us on the liberal right (and those on the conservative right) regularly claim this impartiality does not stand up to close scrutiny.  There are some on the left who claim the same.

The honest truth is that it is contradictory to the core for a state owned broadcaster, funded through a specific tax on TV owners to not have an institutional bias that at its core is about defending itself, and the philosophy that justifies the maintenance and growth of that broadcaster.  When did the BBC last have a programme where it invited BBC critics to put forward the view that it should be reformed, broken up or disbanded?

So how credible is the BBC in policing itself?

There needs to be a fundamental look at what the BBC exists for.  At one time it was the sole broadcaster, in part because of the scarcity of radio spectrum, but also because the state wanted to control what people heard, and later, saw.  

None of these arguments make sense today.  The classic argument for public broadcasting by supporters of it is that it can produce programming that would not be broadcast by TV and radio stations beholden to commercial imperatives.   Yet the BBC does much much more.  It produces a vast range of mass market programming that would be seen on any commercial network.  From EastEnders to Strictly Come  Dancing to live sports coverage, to Radio 1, the BBC broadcasts programming aimed for everyone.

Its competitors have to win either advertisers (audiences it can sell) or subscribers.  It need not.  It faces no financial sanction for failing to deliver what people want, indeed it would argue that unpopular programmes are proper public service broadcasting, and popular ones prove the BBC is delivering for everyone.

Yet, its role in being the leading provider of news and current affairs is never questioned.   Its regular leftwing bias in how it carries out that activity is palpable (I complained about one presenter who said stock traders don't produce anything, with a dismissive head shake, as if they didn't do anything value, and that complaint was dismissed.  I have yet to see the BBC say that about newsreaders), and is seen in how the Guardian now actively defends it.  The line it takes, and was taken on TV by Chris Patten today is that "Murdoch will cheer on the BBC being harmed", as if the News Corp empire is evil and the views expressed in the Times can be dismissed as malignant.   Yes, the impartial BBC thinks this.

A libertarian is always going to think that the idea the government should own a broadcaster and threaten criminal prosecution against any members of the public who refuse to pay for it, whether they watch it or not, is fundamentally wrong.

However, the UK hasn't even had the debate and discussion about the role of the BBC in media policy in recent years.  The Labour Party sees itself as guardian of the BBC as a national institution, not least because the existence of the BBC fits in with its philosophy that treats the state as being activist whenever politicians think it should be.  The Conservative Party has been too scared to take on the BBC, not least because it would mean the BBC had every chance to take on those wishing to reduce its role.

Those on the left who think newspaper proprietors can't police themselves should ask themselves how well the BBC can.  The difference is that people who can read are not forced to pay for newspapers, but people who own TVs are forced to pay for the BBC.

Former Labour man Dan Hodges thinks the problem is the BBC convinces itself it is the world's best, when it is not, and so surrounds itself with a culture of superiority and immunity from criticism.

What else could justify the latest report that the BBC - which has made a point of taking on celebrities and politicians who avoid tax - is now handing its outgoing Director General a golden handshake of £450,000 - more than the Prime Minister's salary - after only 45 days in the job.

Where is the moral authority in that?

Where is the moral authority in denying that it had had complaints about Jimmy Savile when he was alive?

Where is the moral authority for the BBC to ever claim it is above politics, when it is a creature of it?

In an age when more and more media is consumed online, and by mobile devices.  In an age when networks can carry over 1,000 parallel TV channels by cable and satellite, and anyone can set up Youtube channel, podcast and blog, what role can the BBC have?

Should it continue to be all pervasive, dominating local radio and competing like a commercial broadcaster but without the disciplines of one?  Should it just broadcast content that is not commercially viable?  Should it continue to be funded through a poll tax with criminal sanctions for non-payment, or should it tout for donations, should it be funded from general taxation, or should it be subscription funded (given all TV in the UK is now digital, making it feasible to do so)?

That is what should happen next. 

If not, it is time that people deliberately failed to pay the TV licence fee.

It is a complete travesty that every year hundreds of thousands of people get a criminal record because they wont pay for a TV broadcaster.

It is about time that that debate was had, on all media, and the BBC finally felt it had to carry the debate too.

Greens support lunatic fringe on food irradiation so why believe them on climate change?

The Green Party says it believes in science and evidence, and to present itself as the face of reason.

Yet the latest press release from Green MP Steffan Browning demonstrates how quickly the Green Party is beholden to the lunatic fringe of the radical environmental movement.

He says:

"Irradiation is not safe. It is the treating a food with ionizing radiation to kill bugs."

This assertion is backed up with nothing whatsoever.  It is the sort of simpleton view seen in this leaflet which claims without citation that "Numerous scientific studies have exposed the harmful effects of food irradiation".

No, they haven't.

The Health department of Queensland produces a leaflet that is more sober, as does the IAEA.

Browning makes not one claim about why irradiation is not safe. Nothing.

So let's speculate on what he thinks, or rather, fears.

- Irradiating food means it is radioactive:  Hilarious.  It is like saying that if you are exposed to light, you start to glow. 

- Irradiating food "changes its structure" so that it "degrades vitamins and nutrition":  Well yes, it can if it is used for preservation.  Much like drying does, and cooking does.  Cooking changes the molecular structure of food, and the chemistry of food and can destroy vitamins.  The obvious examples would be to boil vegetables to death or cooking food till it is blackened and charred.  However, do the Greens want to stop people having that food or cooking their food incorrectly?

It's bullshit to say irradiated food is not safe.  It's scaremongering, hysterical, anti-scientific and irresponsible for the Green Party to embrace such a stance.

Indeed, let me quote the summary of a World Health Organisation report on the topic (High-dose irradiation: wholesomeness of food irradiated with doses above 10 KGy, a joint FAO/IAEA/WHO study group. Geneva, Switzerland, 15-20 September 1997), given the Greens regularly cite UN organisations to hit governments over the head:

On the basis of the extensive scientific evidence reviewed, the report concludes that food irradiated to any dose appropriate to achieve the intended technological objective is both safe to consume and nutritionally adequate. The experts further conclude that no upper dose limit need be imposed, and that irradiated foods are deemed wholesome throughout the technologically useful dose range from below 10 kGy to envisioned doses above 10 kGy.

So.

Given how willingly the Greens are to make unsubstantiated claims that are essentially the baggage of scaremongering hysterical anti-technology, anti-scientific luddites, why the hell should anyone listen to them when they talk about climate change?

Why should the Greens be any more credible when preaching about science on that topic than they are on food irradiation?

Oh, and we've been here before.  Remember Russel Norman's rant two years ago about mobile phone towers that, when challenged (because Russel doesn't seem to mind TV and radio masts for broadcasting) descends into ad-hominem attacks against me?  

Yes - that's the Greens on science.  On the one hand, claim science is right behind you on climate change and that people who challenge that are unscientific, unreasonable and lunatic fringe.

On the other hand, make non-evidence based scaremongering claims based on little more than the ranting fears of fringe groups that don't even have an elementary understanding of science.

In other words - the Greens are not serious about science.

10 suggestions for the Republicans

The Republicans will now have a fourway - debate that is between four factions:

True religious conservatives - The cross carrying wing of the Tea Party, who will all claim that they needed to be closer to God, be louder on abortion,  Christian values, shrinking the government (except when it is about enforcing the latter) and that Romney was too moderate.  They are in denial that their views on personal freedom are a significant, but shrinking minority.   They are the backbone of activism in many states, but have scared away others elsewhere.

Moderates (RINO some may say) - Who will all claim the Tea Party wrecked the election, and that a moderate, who doesn't want tax cuts for the wealthy, who doesn't want to privatise bankrupt social programmes, who doesn't talk either social or economic conservativism, would have won.  Of course, one wonders what, if anything, would have been on offer that was profoundly different.

Libertarians - The small government wing of the Tea Party, who will all claim that the religious right wrecked the election, and that there needed to be courage about cutting spending, slashing regulation and that Ron Paul could have won over many Democrat supporters.  I doubt it.

Pragmatists - Who will point at Romney flip-flopping, who will point at gaffes by some Republicans, who will point at the fear the Obama camp coughed up about Medicare and social security, and that a campaign of mutual scaremongering and flinging of dirt is unlikely to be as productive as a positive optimistic one with a simple plan.  They will choose whoever can win and do whatever it takes, apparently.

However, I have some views.   Things the Republicans need to think about.  For four years are ahead for them to still control the House (for at least two years), and have a strong voice in the Senate, and for Obama's stuttering recovery to plod slowly forward, until... eventually... the QE fueled bubble inflates and bursts again.

It is that the political map in the US is made up of people who want more involvement of government in the economy, and people who want less - you've kind of positioned yourself as the latter.   However, it is also made up of people who want more involvement of government in people's private lives, and those who want less.  You are a party with people who represent both.  The Democrats are a party that appears to be the latter (but offers nothing on topics from the environment, to drugs, to victimless crimes, to state surveillance).

There is a gap in the political market for a party that accepts social liberalism (true liberalism, as in less government, not interventionist social engineering) as well as an economic free market.

Like the Democrats in 1972, you might face one election with a breakaway socially conservative, anti-immigrant, anti-free trade Pat Buchanan type 3rd party candidate which costs you an election - but like the Democrats in 1972, you will have embraced a new constituency of urban, educated, middle class people who are suspicious of government, but don't pay much attention to religious conservatives preaching to them.  Ronald Reagan was somewhat closer to that than you'll care to remember.  That's a reason why he won virtually every state in the union, and your rejection of this is why you never win the Pacific and half of the Atlantic coast.

Here are some suggestions.

- Medievalism: The likes of Richard Mourdock and Todd Akin just need to be purged.  Todd Akin's comments that women can "shut down" fertility in the event of "legitimate" rape and Richard Mourdock's statement that implied that children of rape are part of God's will caused enormous harm.  Such views are immoral, medieval and scientifically bankrupt, and fundamentally corrosive.  It's not enough to repudiate and condemn them when they get expressed.  No mainstream political party should tolerate even selecting people  with such attitudes.   Get a Presidential or Vice Presidential female candidate that is competent and not a theocrat, and this will make the most profound difference.

- Religion: Most Americans are Christians, and a fair proportion regard church as important.  However, they don't want you preaching to them about it.  Make it clear that you explicitly believe in separation of church and state.  Make it clear that one of the reasons America was formed was by people fleeing religious sectarianism in Europe, and that America is a country where people may have whatever faith they wish, including none.  The ranks of the 20% or so who would welcome a Christian theocracy are decreasing.  You may gain your values from your religion, you may regard it and your church to be important parts of your community.   However, religion is a private matter and to have ever growing numbers of people turn off of your party because they think it excludes them on this point is suicide.  

- Immigration:  The USA was built by immigrants.  Embrace them.  You scared away conservative, hard-working Hispanic and Asian voters. This constituency is only growing. Make your policy open, with the three simple provisos that anyone is welcome as long as they swear allegiance to the Constitution and the values of the Republic, they are not convicted of offences against people or their property and will be prohibited from claiming taxpayer funded welfare, healthcare, social security or education.   In fact, offer all new immigrants that deal.   Come, be free, live your life, leave peaceful people alone, and get the first $30,000 of your income free from Federal Income Tax (and tax deductions as well).  Give all illegal migrants an amnesty period, where if they spend five years without committing a felony and without claiming social security, Medicaid or Medicare, they gain residency.  Get a candidate who is the son or daughter of immigrants.

- Corporatism:  The big stick Obama hit you with was links with big business, giving business tax breaks, Romney paying a low rate of tax and giving a picture of corruption and advantaging big business at the cost of small business at individuals.  Of course, he's just as guilty, so you need to change the terms of the debate.  Advance scrapping all subsidies to business, including agriculture.  Advance a simple low tax plan, with a high income tax free threshold, include scrapping as many rebates as you can as you lower rates.  Make it clear that no businesses should ever be bailed out by the Federal Government ever again.  Reform Fannie Mae and Freddie Mac to remove the government guarantee for them.   In other words, offer the American people a grand deal that is about eliminating taxpayer funded pork.  Make it the same in regulation, so that statutory monopolies are abolished, both private and public (e.g. USPS).  Abolish eminent domain for the private sector (you wont do the public sector, but you can heavily constrain it for the public sector).   The Democrats are propped up by enormous networks of interests with subsidies, specific tax breaks and regulations, so do a clean sweep.  Make it clear you want Americans rich and poor, businesses big and small to have a level regulatory and tax playing field.  Indeed, right now this should be your number one argument with the President on avoiding the fiscal cliff.

- Tax, deficit and debt:  This point resonates and has been partially successful, but your rhetoric and policies were easily criticised. Until the US is in budgetary surplus, it will be difficult for you to do much in taxes beyond oppose increases and advocate reforms that simplify them and mean in exchange for vast rebates and deductions, lower rates overall.. Your response to Romney's low tax rate should have been to advocate it for all tax.  Why should capital gains tax be lower?  On the deficit your blind spot is defence.  The big hole here is that US defence procurement remains extraordinarily wasteful, and there is considerable scope for efficiency and consolidation.   The US can still retain global dominance in nuclear deterrence, it can retain military superiority in its presence in Asia and the Middle East (for good reasons of trade and energy security), but without the heavy presence in Iraq and Afghanistan there is scope to contain spending in real terms.  Do that, end corporate welfare and you can start arguing for a long term privatised option to social security and Medicare, with specific tax opt outs for those who select it.  Meanwhile, you must continue with no new taxes on the fiscal cliff, but push hard for abolishing corporate welfare, raising entitlement thresholds for social security and Medicare, and be vocal against anyone seeking to grow public spending of any kind.  

- Abortion:  I could say just shut up, but you wont.  What you can do is simply say you will end Federal funding for it, because people who believe it is murder should not be forced to pay for it.   You can say it is up to the states how they deal with the issue, given Supreme Court precedence, and you respect the rule of law and precedent.  Yes, there is a big rump of Republicans for whom this is the top issue, but the only way this will go further is if you can convince people that you are right.  The majority of people have a view that is neither abortion on demand, nor life begins at conception.   If you're serious about reducing the incidence of abortion, then change the terms of the debate.  The current strategy is a dead end, and it loses you the White House.

- Personal freedom:  You're happy talking about the right to bear arms, you're happy talking about lower taxes and small government, but you clam up when it comes to what people do with their private lives.  How about questioning the war on drugs?  How about saying you'll leave the legal status of marijuana to the states? That will put a bomb under the Democrats.  It will also suddenly wake up Californians, again.  Do the same about the status of marriage.  You gain nothing by advancing a Constitutional amendment about marriage, leave it to the states.  A growing proportion of Americans do not care if people are gay, and a growing proportion are turned off of political candidates who do care. If you want to preach that it's wrong, go ahead, do so.  However, don't do so implying the government should pass laws against it.

- Economic nationalism:  You target this because whenever the Democrats are in power, they fail to meet the expectations of xenophobic unions who preach the "foreigners stole our jobs" or "our jobs are being exported" line.  Let it go.  Make it clear the biggest threat to the US economy is being in hock to foreign creditors.  Simple as that.  I'd like to think you could push for global trade liberalisation, but you'll fear handing Obama the plate of economic nationalism.

- Education freedom:  More than a few states are doing this, you can push this further.  One of the great success stories for those advancing freedom is the advent of vouchers and other systems to allow taxpayer funding of compulsory education to follow students to those who set up independent schools.  Make this a priority, sell how this helps the poor, sell how it allows parents to choose the education for their children.  The teaching unions and Democrats in hock to them hate this. However, for you it is a chance for long term cultural change, and to simply advance parents over vested interests.

and last, probably least to you, but it's worth it...

- Ayn Rand:  You've discovered her, now read some more, specifically Capitalism: the Unknown Ideal  and Philosophy: Who Needs it.  I know you know she advocated minimalist government, but she was also an atheist.  An atheist who believed genuine human benevolence and kindness was superior to a welfare state.  Embrace that, as it actually core to how most Americans are and realise that those without your beliefs can be good people too.  She rejected the corporatism all too many of you support.  Most of all she embraced the view that the number one value for all people is the pursuit of happiness in their own life.  It's an antidote to the nihilistic muddle-headed whim worshipping that is prevalent in popular culture.  It is an antidote to the entitlement culture Obama has continue to nurture, but which has roots from FDR.  Oh and no, you didn't advance anything that was more than a hint of the shadow of her views in the election.  I don't expect you to be an objectivist party or even libertarian, but the values of self-esteem, of personal achievement, of benevolence over dependence and violent demands and of letting peaceful people get on with their lives can be sold. The clearer you understand that, the clearer it is the other side only has the offer of making some people pay for others, of telling people they aren't responsible for their own circumstances and claiming they can make it all better.

Romney is a positive choice over Obama

The US Presidential election campaign has been lacklustre and uninspiring, but then again I don't know what else to expect.   I called the 2008 campaign braindead, because a man who wins on the basis of single word slogans like "change", whose own history was decidedly leftwing, didn't deserve the reins of power just because he represented a step-change in race relations in the USA.

Vacuous image obsessed Americans hopped on the Obama rhetoric in 2008 of "hope" and "change", which much of the mainstream media lapped up without questioning what that really meant.  Obama was a celebrity, promising slogans and it is hardly surprising that reality shakes up the airhead image that was created around him.  He is now just a politician, as I predicted after he was inaugurated.  He was the man who gave Gordon Brown a DVD set as a gift, after Brown had given him an impressive set of gifts with historical significance attached.

On foreign policy, I said in 2008 that:

Obama's foreign policy is essentially to talk to everyone, and focus on Afghanistan rather than Iraq. He'll be liked internationally and he'll be tested, by the enemies of the USA, and that will be the supreme test - to see if he hesitates or can be decisive to take military action when required. 

His highest profile achievement was the pursuit and execution of Osama Bin Laden.  Notable yes, but it is ludicrous to suggest there has been any sort of real victory in Afghanistan or against Islamism under Obama.  On foreign policy, it is worth checking what has been achieved in the main arenas of interest for the US:

- Arab "spring":  Obama's Administration has been unremarkable.  It was slow to endorse the overthrow of authoritarian regimes in Tunisia and Egypt.  However, this was the man who went to Cairo to seek understanding and talk of shared values, and did nothing about Libya until the UK and France were willing to help in the overthrow of Muammar Gaddafi.  On Syria, it seems Russia can actively intervene, but Obama dare not even try to impose a no-fly zone over the country.  Meanwhile, Obama stood by whilst the Bahrain regime turned its guns on those seeking freedom in that country.  Obama's leftwing supporters would excoriate a Republican President keeping silent over that, but apparently it's still ok for US allies to kill and incarcerate those seeking freedom.  Iraq increasingly is becoming a client state of Iran, but let's not talk about that.

- Israeli-Palestinian conflict:  Nothing to see here.  Israelis have voted for a hardline regime that is unwilling to compromise, Hamas has treated the election of the Muslim Brotherhood in Egypt as a reason to do the same (although there are major differences between them).  

- Iran:  Iran's economy is in turmoil because of tougher sanctions, which is good. Yet it is difficult to see how things would have been different under John McCain.  Iran seems more likely to give up nuclear capability out of economic desperation than anything else.

- China: Obama has played a bit of a tough line on trade with China and to his credit, the US has stood with its allies Japan and the Philippines against Chinese aggressive rhetoric and actions on disputed islands.  It is hard to see what else could be done, beyond bolstering America's domestic strength.

- Russia: Obama's one capitulation here has been to withdraw promises to install anti-missile defence systems in eastern Europe.  Ignoring Russia's aggression in Syria remain a weakness. 

- Trade and international economic policy: Obama has been uninterested in free trade and the WTO's attempt at revitalising the Doha round failed, in part, because Obama is suspicious of free trade.  The later appearance of a handful of trade agreements notwithstanding, this has been the biggest foreign policy failure of Obama.  A grand deal on liberalising world trade could have done more to boost the global economy.  

On domestic policy I said in 2008:

Obama's domestic policy is also nothing new. Tax cuts for many, tax hikes for "the rich", he wants to grow the Federal Government with umpteen new spending promises and to radically reform health care. He offers the status quo on social security and education. He has a consistent record of supporting "pork barrel" subsidies and programmes.

Change you can believe in? Hardly.

Of these his big achievement is "Obamacare",  a policy rooted in some sound principles, and one Romney can't oppose honestly given he implemented something similar as Governor of Massachusetts. However, it means he now fines people for not buying health insurance.  Obama has failed miserably to reform Social Security, Medicare and Medicaid, all of which threaten to bankrupt the US.

On economic policy, Obama has raised overspending to US$3 trillion per annum.  He has been master at "stimulus" spending, using borrowed money to engage in pork barrel funding of companies and public works projects.  One of his latest is high speed rail, which will cost billions, fail to deliver on economic and environmental grounds, but is just part of his totemic belief that government can do great things with other people's money.

He has maintained the blind faith in printing money, he has done little to deal to one of the core causes of the financial crisis - government guarantees of mortgages through Fannie Mae and Freddie Mac, and he believes the way to fiscal prudence is in raising taxes, and trimming spending around the edges.

Mitt Romney is hardly a hero for freedom.  He wants to significantly increase military spending, although it is unclear why.  His promises to balance the budget without raising taxes are welcome, but it is unclear if he really has courage to cut spending enough, especially when he talks about restoring funding for Medicare that he claims Obama cut.  Romney is mister flip-flop.  It is easy to find hypocrisy and contradictions in what he has said.

Romney's religious beliefs should make any rational person pause.  Mormonism is a weird cult that doesn't stand up to close scrutiny.  Yet he hasn't pushed faith in this election at all.   Obama supporters and Obama himself claim he would ban abortion and deny women contraceptive choice, but there is no evidence for this.  Beyond Obama's willingness to continue taxpayer funding for contraception and stem cell research (which a libertarian opposes on principle as being not a legitimate function of government), there is little between them substantively (abortion law is not going to change, no matter what).

So what is left between them?  It's the economy.

There are two broad visions on offer here, and it can be seen in how both men see the timebomb that has been building up for decades.  Public debt, the budget deficit and the unfunded liabilities of Social Security, Medicare and Medicaid.

Obama has made it worse and blames Bush for it, he's right about the latter, but he's done little to deal with it.

Obama's view is that taxes need to go up, and there needs to be some spending restraint, with $1 increase in taxes for every $2.50 cut in spending. In other words, he wants revenue to rise to match government spending.  He does, fundamentally, belief that more government is good for the USA.  He has consistently increased spending on subsidies in agriculture and energy.  His statement that "you didn't build that" when talking about how businesses rely on roads that they didn't build, is a core belief that business needs government to do more that protect private property rights and individual freedom, but that government should provide services.

Romney's view is that taxes should be reduced, but that he will achieve this by simplifying and cutting tax deductions (which are complex) to fund it.  He will offer an option of private social security accounts for those below a certain age, and will raise the social security age and reduce the rate of inflation adjustment.  At least he acknowledges there is a problem.   He essentially wants to move to a voucher system for education, which holds out some hope to break the dominance of state provided schools captured by teachers' unions.  However, the big difference with Obama is Romney doesn't believe taxes should rise to meet government spending.

So if there is one thing to vote on, for lovers of freedom, it is that Romney will prefer to shrink the Federal Government over raising taxes.

With Paul Ryan, a cautious enthusiast of Ayn Rand, helping out, and with the Republicans likely to maintain a majority in the House of Representatives (if not get one in the Senate), there is a chance for the direction of US economic policy to change.  Add on top of that Romney's willingness to establish a national commission to look at restoring the link between the dollar and gold, and there is not just a reason to vote against Obama, but vote for Romney.

Indeed, having gone through his policies, I find little that is contrary to smaller government and more freedom.   Romney is a better candidate than either of the Bushes, John McCain or Bob Dole.

So on that front, it is clear to me that faced with the choice, American believers in less government should vote for Mitt Romney.  Barack Obama should not have four more years to of overspending and debasing the dollar with mediocre results.  He should not continue to hook more Americans on corporate welfare and totemic energy and transportation projects funded by borrowed money.  He should not continue to pander to the envy ridden hatred of success that demands more taxes and he should not be allowed to tip the Supreme Court into the hand of moral relativists.   

Under Obama the economic freedom ranking of the USA has dropped from 15th to 18th, on size of government it is ranked 73rd!  On regulation it is ranked 31st in the world (24th in 2009).  On freedom to trade it is ranked 57th in the world.  

Romney might reverse some of that, and the future prosperity and strength of the USA depends on the country ending its fiscal incontinence, ending its monetary debasement and allowing the capitalist free-enterprise system that built the world's greatest economy to grow once more, within the boundaries of the rule of law, property rights and individual rights.  For it is that which will defend the USA in the long run, against the corrupt authoritarian corporatist "capitalism" of China.

$16 trillion public debt and counting will not.

Shonky journalism on Stuff about airline seating

Shonky journalism.  That's what the Fairfax news article on Stuff claiming Air NZ wedges passengers into seats really is.  Not that is it that important.  It is a fairly trivial travel issue.  However, given the willingness of some journalists to slam bloggers for not being professional, it provides just a taste of how shallow and deceiving poor quality journalism can be.

The article reports on a survey that was undertaken by Business Traveller, which owns a website about airline seat plans called Seatplans, which like Seatguru and Seatexpert are not always reliable.

That's not journalism, that's reporting.  Journalism would involve doing some research, going through such sites and maybe the websites of the airlines themselves, or even ask them, and making it relevant to those reading it. 

The claim is that Air NZ's seat width is 28th, but Emirates is best.  It came 15th in legroom apparently, yet the range of legroom given is 12cm.  

Yet all of these claims are nonsensical unless you talk about specific aircraft on specific routes.

Air NZ has aircraft ranging from small turboprop Beech 1900 to Boeing 747s.  The idea that you can average out between them is flawed.

So what really is the picture?

First of all, the routes where this matters are long haul.  Yes you might complain about sitting for an hour on a domestic flight, but most people care only about price on short haul routes, but there is nothing in it between Air NZ and Jetstar on domestic flights - unless you have Air NZ Gold or Gold Elite status or Koru Club membership, so you can access the Space + seats on 737s an A320.  They offer an additional 2"- 5" of legroom.  A320s have slightly more seat width than 737s, but that wasn't noticed.

So what about long haul?  The long haul airlines flying to NZ are Air NZ, Singapore Airlines, Emirates, Cathay Pacific, Korean, China Airlines, China Southern, LAN, Malaysian and Thai.  Given the connections available, Qantas, BA, Etihad and Virgin Atlantic are worth looking at.

Now the lazy thing to do is to treat all aircraft by all airlines as relevant.  They are not.  So I have simply reviewed those that operate the long haul flights to NZ (or connect in Australia or the main flights connected to by those airlines).

Bear in mind this is all economy class.  If this really matters to you that much, pay more and go in premium economy or business class.

Seat pitch is the measure used for legroom, which just means the distance between the same point on two rows.  Bear in mind this is not the same in the whole cabin of individual planes, with there being ranges of 2-3 inches on some.  You can check this on websites like Flyertalk where there is a lot of detail about individual seat rows.

So let me fact check the claims in the article, particularly since I took a little time to provide you with a full list of seat pitch and widths for all long haul airliners serving NZ or on major connecting services.

1. "Air New Zealand economy seats were among the most cramped in the skies, the airline tied for 28th place out of 32 airlines with Qatar Airways, which has an economy seat width of between 41.9cm and 45.7cm"

No.  None of Air NZ long haul aircraft have seat widths of 16.5" (41.9cm), but the 17.9" (45.7cm) seat width is also more than any it has (by a tiny amount).  The relevant figures would be 43.4cm-45.2cm.  Air NZ's seat width on the 747s and 777-200s compares well with others being 4th equal.  The 777-300s are tighter at 6th, with Etihad, Emirates (777) Malaysian and Qantas (A330 only) being slightly tighter.  So in fact, Air NZ is rather average.

2. "Budget carrier Ryanair had the most cramped economy seats, offering just 40.6cm of width. Emirates' seats were the most spacious at 45.7cm to 52.1cm."

Yes on Ryanair, but you wont be flying it unless you're in Europe.  Emirates on the other hand draws with the others listed above for having the narrowest seats on the 777 flights to NZ.  Hardly the most spacious is it? Given Emirates squeezes an extra seat in its 777s (Air NZ now does on the 777-300s only) it is not surprising.  The A380s have an additional inch of seat width, but don't reach the 19" of the Singapore Airlines 777-300ERs.  So Emirates is not the widest, as far as flights to NZ as concerned.

3.  "Air New Zealand fared better in the economy legroom category, giving between 76.2cm and 88.9cm of space, putting it in 15th place"

Um not really. Yet neither of those figures represent seat pitch on long haul Air NZ aircraft, which are between those.  The 76.2cm applies to domestic aircraft and the A320s (30") excluding the Space + cabin, the 88.9cm IS Space +.  So given Space + doesn't exist on long haul aircraft, and the seat pitch on long haul aircraft is two inches more than the bottom figure, it really isn't useful.  In fact, Air NZ ranks second best with its 747s only, and other aircraft are comparable (but only some seats on the 777-200s rank with the worst).  

Draw your own conclusions, because it is complex, with different aircraft, airlines buy different seats for them, for different routes.  There is up to a four inch legroom difference between best and worst, and two inches in seat width, but you actually need to check the route you want to fly and what airlines operate there.  Frankly, unless you are flying to Europe from NZ, your choices will be limited to one or two airlines at best.  So choose carefully if this matters and you can't afford to uplift to the next class up.

Most importantly, do you own research, don't believe what a newspaper says.

Air NZ                             Seat Pitch     Seat Width

Boeing 777-300ER          32-33"         17.1"  (3-4-3 configuration) AKL-LAX-LHR

Boeing 747-400               32-34"         17.8"  (3-4-3)  AKL-SFO

Boeing 777-200ER          31-32"         17.8"  (3-3-3)  AKL-HKG-LHR, SFO, YVR, PER

Boeing 767-300               32"               17.5"  (2-3-2)  AKL-HNL, NRT, KIX, PPT

British Airways (from Sydney to Singapore and London)

Boeing 747-400              31"               17.5" (3-4-3)

Boeing 777-300ER         31"               17.5" (3-4-3)

Cathay Pacific (to Hong Kong and beyond)

Airbus A340                   32"               17.8" (2-4-2)

China Airlines (to Taiwan and beyond)

Airbus A330-300           32"                18" (2-4-2) 

China Southern (to Guangzhou and beyond)

Airbus A330-200          35"                 17.2" (2-4-2)

Emirates (to Australia and Dubai)

Boeing 777-300ER         34"               17" (3-4-3) AKL, CHC

Airbus A380                   32"               18" (3-4-3) AKL

Etihad (from Sydney to Abu Dhabi and beyond, codeshares Air NZ)

Airbus A340-600           31-33"          17" (2-4-2)

Korean (to Seoul and beyond)

Boeing 777-200ER         33-34"          18"  (3-3-3)

Boeing 747-400              33-34"          17.2" (3-4-3)

LAN (to Santiago)

Airbus A340                  32"               18" (2-4-2)

Malaysia (to Kuala Lumpur and beyond)

Boeing 777-200             34"               17" (2-5-2)

Qantas (from Sydney, Melbourne to Europe/Asia/North America)

Airbus A380                  31"               18.1" (3-4-3)

Boeing 747-400             31"               17.5" (3-4-3)

Airbus A330                  31"               17" (2-4-2)

Singapore Airlines (to Singapore and beyond)

Boeing 777-300ER         32"                19"  (3-3-3) AKL (and many routes from SIN to Europe)

Boeing 777-200ER         34"                17.5" (3-3-3) AKL, CHC

Airbus A380                   32"                19" (3-4-3) (many flights from SIN to Europe)

Thai (to Bangkok and beyond)

Boeing 777-200ER       34"                 17" (3-3-3)

Virgin Atlantic (from Sydney to Hong Kong and London, and from San Francisco to London, from Shanghai to London all connecting with Air NZ)

Airbus A340-600         32"                 17.5" (2-4-2)

Yes you can privatise the roads - says UK thinktank

The Institute of Economic Affairs (IEA) is rapidly becoming one of the highest profile think tanks in the UK, certainly it has been getting increased media exposure, including the regular appearance, on the BBC no less, of the excellent Communications Director Ruth Porter (who has links to New Zealand, having once worked for the Maxim Institute - not a reason to hold against her though).

It describes itself as "the UK's original free-market think-tank, founded in 1955. Our mission is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems".

It has become one of the foremost advocates for questioning new government interventions, preferring less government spending and regulation, and seeking solutions involving free markets and personal choice over statism.

The latest report commissioned and published by the IEA, has been written by German transport economist and President of the Institute for Free Enterprise, Dr Oliver Knipping, and IEA deputy editorial director and director of its transport unit, Dr Richard Wellings.

It advocates privatising all roads in the UK.  Yes, ALL roads.  

The report is available here, and makes a compelling case that damns the existing system for producing inefficient outcomes (congestion, poor maintenance standards, inadequate supply of capacity in some areas and overbuilding in others) and suggests that the government simply get out of the way, by selling some roads and giving others away perhaps to co-operatives of road users and property owners to decide for themselves how to make money from them.

The authors propose that all roads, motorways, major highways, rural roads and urban streets could be privatised. Just selling the major highways is estimated to generate £150 billion for the government, which could be used to repay public debt, saving several billion a year in interest.  That would still leave local roads to be privatised by transfers to co-operatives of businesses and residential properties.

The new owners could choose to toll, issue access permits or leave the roads free when and where they saw fit, using whatever technologies they decided.

In exchange, the authors suggested abolishing vehicle excise duty (the equivalent of motor vehicle registration), and cutting fuel tax by at least 75% (noting that the UK, unlike NZ and the USA, does not legally dedicate any fuel tax to government spending on roads - but the existing fuel tax takes four times as much tax revenue as is spent on the roads), with the remainder being a sop to environmentalists by reflecting a carbon tax and tax on emissions.  This would reduce the price of fuel in the UK by a whopping 53p/l (though they neglect to note that EU law sets a minimum tax rate for energy that is about 29p/l).

Wouldn't the new road owners rip everyone off?  Well the authors say no. They have several ideas to avoid this.

They argue that the way privatisation is carried out should be done to promote competition between road owners.  For example, major highways could be sold to different companies, so that the M6/M1 and the M40 would have different owners offering different prices for driving between London and Birmingham.  Yes, there will be many cases where competition isn't feasible, but having some competition is more than exists now.  They see breaking up the road network so it doesn't resemble the patchwork of central and local government controlled routes now, would promote competition and innovative approaches to pricing.

By allowing road owners to price flexibly, it would mean prices at off peak times would likely be lower than at peaks, because underutilised assets are better off with customers willing to pay to use them, especially cars as they inflict relatively little damage to road surfaces compared to trucks.   As such, it may be much cheaper to drive outside commuter and holiday peaks than today.

Local roads owned by businesses seeking customers are more likely to discount access or offer it for free, especially if it attracts retail customers.  They may see this as important as offering free parking, so that the incentives are wider than just paying for the roads.

There remains competition  from other modes for certain trips, such as railways, airlines and canals.  In addition, telecommunications technology makes it increasingly attractive to use phones, Skype and other forms of teleconferencing instead of travelling.  Road owners will not be insensitive to these options.

Indeed, the question about being "ripped off" becomes more moot, if road owners are seeking to attract users by having well maintained, well signposted roads, which are priced to avoid congestion by spreading demand, and a planning system that does not prevent new capacity being built except by road owners needing to consider private property rights.  The likelihood is that the motoring experience will improve.

Finally, it's worth noting (though they did not appear to do so in the report), that with government in the UK already recovering four times as much in motoring taxes from road users (fuel tax and vehicle excise duty) than it spends on roads, that motorists are already being ripped off, by the government.

The UK government is today considering how to get more private sector involvement in financing and building roads, this report shows how far it could really go, and is one of the few studies I've seen which actually breaks apart the "consensus" of state owned and operated roads, and shows how it might be different, and better with privatisation.

Lithuania isn't in a recession - No Right Turn is not right again

I do read the No Right Turn blog from time to time, and it demonstrate how willfully blind and deceptive some can be when the facts reported in the same story they quote from, don't fit their blinkered vision.

He said:

Lithuanians went to the polls today in the first round of parliamentary elections - and have voted resoundingly against their neoLiberal, pro-austerity government which had plunged them into a Greek-style austerity-induced recession.

He links to a BBC article about the election and says that the government "plunged them" into a recession.  The leftwing meme being simply that reforms that shrink the state sector create a recession and Greece's problems are that it is cutting spending, not that it can't borrow to sustain overspending anymore and is having to beg from other states to cover its overspending until it can balance its books.

Yet that very same article from the BBC says this about the Lithuanian economy:

Mr Kubilius came to power in 2008, just as the global financial crisis was bringing a dramatic end to an extended Lithuanian boom fuelled by cheap Scandinavian credit.

So Lithuania's recession started the same way as most of the others, cheap credit from banks with state issued fiat currencies, overborrowing and an adjustment when reality set in.

Mr Kubilius enforced a drastic austerity programme, to stave off national bankruptcy.

Presumably the leftwing view of this is that the government should simply print more money.  After all if the state can't borrow anymore, it either has to cut spending, raise taxes or print.

Meanwhile, economic output dropped by 15%, unemployment climbed and thousands of young people emigrated from the Baltic nation of 3.3 million in search of work.

Yes, a fiat currency credit fueled boom adjusting itself, and the government balancing its books.

The budget deficit has since been tamed and GDP reached growth of 5.8%.

Hold on.  Growth of 5.8%? What is this austerity induced recession?  Indeed according to Eurostat, Lithuania's unemployment rate has been dropping from a peak of 18.3% in June 2010 to 12.9% in August 2012.  

Idiot Savant need only have read the rest of the article for it to be obvious the recession in Lithuania is well and truly over, and a 5 minute search to find the Lithuanian unemployment rate.

However, that wouldn't suit the "evil neo-liberals want to destroy the state and ruin the economy and want mass unemployment, but socialists love people, want prosperity and know how to do it, if only they were allowed to spend money that doesn't exist, and could get their hands on all the money of the evil capitalists" monologue that he, and the left (becoming more and more out of touch with economic) have been preaching.

Greece is a totemic example of the failure of socialism to deliver sustainable prosperity, followed by Portugal and Italy.  Spain and Ireland are totemic examples of the failure of cheap credit created from nothing through fiat currencies and fractional reserve banking.

Maybe Idiot Savant might want to revise his tired empty thesis that the only people to blame when governments overspend, are those who loaned money to them in the first place,  because when they stop, what does he really expect should happen?

European Union peace prize?

Oh how I laughed, so much, when I read that news.

Whilst I understand why the Nobel Committee gave the EU the Nobel Peace Prize, it is, quite simply, wrong.

The peace in Europe since 1945 was due to the following:

-  The complete unconditional defeat of Nazi Germany by the US, UK and USSR (with a little help from partisan resistance groups);

-  NATO (and France outside NATO). Keeping the USSR and the Warsaw Pact at bay, especially after the Berlin airlift;

-  The economic integration of Western Europe since 1945 facilitated by the USA through the Marshall Plan, followed by the forerunners of the EU and the GATT/WTO.

There would have been no EU without the unconditional defeat of Nazi Germany, or rather no peace unless you would have counted a unified Europe under Hitler.  

There would have been no EU without NATO deterring the eastward roll of the Red Army by Stalin, using strategic and tactical nuclear weapons.  There would have been no peace either.

There would have been no EU without the commitment of West Germany's post-war leaders to economic reconstruction, a business friendly environment, and to face up to what happened.   To that end, for Greek protestors to fly swastikas because they don't like being told their government might want to keep spending within limits of what it raises in revenue, are dead wrong.

There would have been no EU without the United States providing the aid, providing the foundations of NATO, providing the bulk of the nuclear deterrent, providing support for the GATT (now WTO) to force open global markets in manufactured goods (the core of the Western European economy in the 50s and 60s).

Yes, the EU has helped bind former warring states together, it has also enabled there to be some recognition of mutual values  (however flawed they are in interpretation and application), of free speech, freedom of religion, belief in open liberal democracy, belief in the separation of powers (judiciary, executive, legislature and police), and a broad acceptance of liberal values that reject state racism and sexism, but overwhelmingly are opposed to authoritarian rule.  Yes, there are many ways that is flawed and inconsistent, but compare it to Asia, the Middle East, Africa and Latin America.  Compare it to half of Europe before 1989.

But as the Saturday Daily Telegraph said, it has hardly got a glowing record when faced with major threats to peace and security.

The Nobel committee’s citation explicitly referred to its work in Yugoslavia. Yet Europe largely wrung its hands on the sidelines, until the US ended the bloodshed and forced a peace, as it later did in Kosovo. More recently, in Libya, it was Britain and France, not Brussels and Baroness Ashton, who acted as liberators – again with America’s support.

The EU did not bring down the Berlin Wall, the people of east Germany did after Gorbachev made it clear the USSR would not support east Germany continuing to oppress its people, and east Germans had spent decades watching West German TV and listening to radio from West Germany, the UK and the US.

In Yugoslavia it took US military action against Serbia for the genocide to cease and for Milosevic to stop "ethnic cleansing" of Bosnia, parts of Croatia and Kosovo.  However, it is important to note that one reason many Europeans, in continental Europe, support the EU, is because they have relatives who in living memory endured occupation by the Nazis, or lived under fascism of one kind or another, and have been sold the idea that the EU has stopped all that.  Conveniently, of course, whitewashing out the key role the United States has played, in money and lives, in keeping half of Europe relatively free and staying steadfast to allow almost all of the rest to be relatively free now.

On economics, the liberating movement of the EEC/EU in bringing down barriers among members have been somewhat matched by new barriers with the outside world.  The Common Agricultural Policy, essentially a scam that enabled France's antiquarian farming sector, propped up by grotesquely generous subsidies to pacify (and avoid a perceived fear of Marxist revolution in the countryside), to survive thanks to German, British and Dutch taxpayers, meanwhile dumping subsidised produce on the rest of the world, shutting out efficient producers beyond quotas and tariffs and contributing to environmental degradation and higher food prices in Europe.  The EU maintains massive programmes of vanity projects, like Galileo to replicate GPS and more recently efforts to replicate US, Japanese and European state programmes for earth observation satellites.  It dares demand austerity in the Eurozone whilst seeking annual increases in its own budget beyond inflation.   It's own politicians and senior officials, partly hand picked by national politicians engaging in patronage, enjoy lavish lifestyles travelling in luxury, feeling self important, whilst being ever so distant from those who pay for them.

Now it is printing money, demanding some Member States eviscerate their own private sectors with tax rises whilst trimming their public sectors with spending cuts, stating that the Euro -which should simply be a currency - is not an economic project, but a political one.  

I'll let the Telegraph editorial finish my thoughts on this:

Yes, Europe has been transformed over the past half-century – in the committee’s words – from a continent of war to a continent of peace. But that came about largely through the establishment of trade links, the free movement of people, the knitting together of an economic union rather than a cultural one. The irony of yesterday’s announcement is that the single gravest danger to that peace – provoking riots in Spain, demonstrations in Italy, the rise of far-Right movements in Greece – is arguably the European project itself, as it exhausts the Continent’s treasuries to prop up a crumbling currency union. 

The good news is that there is still time for Europe to pull itself out of this grim spiral, to rediscover and reaffirm the shared freedom and shared prosperity that made it such a beacon to the impoverished or imprisoned nations on its borders. If it can do that, it might even deserve such a prize. As it stands, this bauble feels more like a decoration for the headstone of a once noble ideal.

I would say the EU doesn't deserve it, but then given how debased the Nobel Peace Prize is (and has been for decades), then I wouldn't really wish it on anyone unless I was wanting to mock them.  It has become a caricature of what it is meant to stand for.

What's only funnier is the EU-crats, politicians and their lackeys thinking how very deserving they are for their great efforts.  Yet if it continues to be a barrier to prosperity in Europe, if it continues to expound the socialist view that the successful striving saving nations should pay for the deficit ridden corrupt and spendthrift ones, the only thing keeping the EU together is the good will, of Germans, who don't want to be thought of as being like the Nazis.   Right now, they are willing to let a lot of their taxes and some of their savings, be taken for their reputation.  How long that continues, depends on how many of them remain in jobs, remain immune from inflation and turn a blind eye to being called Nazis despite their hard work and generosity.

It is the USA, NATO and West German/reunifed German political leaders that have produced a legacy of peace.  It is the EU that arrogantly presumes that this legacy is immutable.

What went wrong with Greece

Aristides Hatzis is Associate Professor of Philosophy of Law & Theory of Institutions at the University of Athens, Department of Philosophy & History of Science.

He has some firm views of what went wrong in Greece, and it is not a view that fits the conspiracy theories of the Syriza party or the empty claims that Greece is a victim of financiers.

Hatzis says Greece joined the then EC (now EU) in relatively good economic health:

Seven years after embracing constitutional democracy the nine (then) members of the European Community (EC) accepted Greece as its tenth member (even before Spain and Portugal). Why? It was mostly a political decision but it was also based on decades of economic growth, despite all the setbacks and obstacles. When Greece entered the EC, the country’s public debt stood at 28 percent of GDP; the budget deficit was less than 3 percent of GDP; and the unemployment rate was 2–3 percent. But that was not the end of the story.

Greek voters voted to the left, and that changed everything:

Greece became a member of the European Community on January 1, 1981. Ten months later (October 18, 1981) the socialist party of Andreas Papandreou (PASOK) came to power with a radical statist and populist agenda, which included exiting the European Community. Of course nobody was so stupid as to fulfill such a promise. Greece, with PASOK in power, stayed in the EC but managed to change Greece’s political and economic climate in only a few years.

He continues to explain that PASOK changed the relationship between the state and the people, but even the so-called "rightwing" opposition did nothing to change that.  Recognise that pattern in other countries?

Today’s crisis in Greece is mainly the result of PASOK’s short- sighted policies, in two important respects:

(a) PASOK’s economic policies were catastrophic; they created a deadly mix of a bloated and inefficient welfare state with stifling intervention and overregulation of the private sector. (b) The political legacy of PASOK was even more devastating in the long-term, since its political success transformed Greece’s conservative party (“New Democracy”) into a poor photocopy of PASOK. From 1981 to 2009 both parties mainly offered welfare populism, cronyism, statism, nepotism, protectionism, and paternalism. And so they remain. Today’s result is the outcome of a disastrous competition between the parties to offer patronage, welfare populism, and predatory statism to their constituencies.

It wasn't as if the political classes didn't know there needed to be reforms either, but the bare minimum was done to reach a magic goal - joining the EURO.  So how did Greece expand spending on such a grand scale?  It wasn't from taxation, because tax evasion was rampant and tax collection very inefficient, but borrowing.  

He calls it  "party time":

The borrowing became much easier and cheaper after Greece 2adopted the Euro in 2002. After 2002, Greece enjoyed a long boom based on cheap and plentiful credit, because the bond markets no longer worried about high inflation or a devalued currency, which allowed it to finance large current-account deficits. That led to a crippling €350 billion public debt (half of it to foreign banks) but, more importantly, also to a negative effect that is rarely discussed:The transfers from the EU and the borrowed money went directly to finance consumption, not to saving, investment, infrastructure, modernization, or institutional development. The Greek “party time” with the money of others lasted 30 years and—I must admit it—we really enjoyed it! Average per capita income reached $31,700 in 2008, the twenty-fifth high- est in the world, higher than Italy and Spain, and 95 percent of the EU average. Private spending was 12 percent more than the European average, giving Greece the twenty-second highest hu- man development and quality of life indices in the world. 

Yes, most of the borrowing the Greek government undertook was not to build infrastructure (except for some very high profile totemic projects like the Olympics, a metro, tram lines and a new airport), nor to finance productivity improvements, but to consume.

People lied and evaded tax, but this culture was endemic.  Remember this isn't an outsider, but a Greek academic noting this:

Lying became a way of life in Greece. Still, one might argue that lying to protect what one has created is justified. But in Greece that wealth was not created, but simply borrowed. In 1980 public debt was 28 percent of GDP, but by 1990 it had reached 89 percent and in early 2010 it was more than 140 percent. The budget deficit went from less than 3 percent in 1980 to 15 percent in 2010. Government spending in 1980 was only 29 percent of GDP; thirty years later (2009) it had reached 53.1 percent. Those figures were hidden by the Greek government as late as 2010 when it admitted that it had not actually met the qualifying standard to join the Eurozone at all. The Greek government had even hired Wall Street firms, most notably Goldman Sachs, to help them fudge the numbers and deceive lenders.

Yet for entrepreneurial activity, Greece became a disaster. In 2012 it was ranked 100th out of 183 countries for ease of doing business, being the worst in the EU and the OECD and below Columbia, Rwanda, Vietnam, Zambia and Kazakhstan.  It ranked 154th for laws protecting investors and 147th for ease of employment.  The best ranking was 43rd, for closing a business.  One study indicated that 25% of Greece's GDP was "informal" or outside the law, and petty corruption cost €800 million in 2009.  42% of the state budget is on welfare benefits of some kind.  Pensions were ridiculously generous.  35 years working in the state sector allowed a man to retire at 58 on a pension.  

The "free" public health system actually saw 45% of total health spending coming informally directly from users bribing staff to do their jobs.

Greece is now facing some reality.  It is still borrowing, but this time from taxpayers in Germany in effect.  It is still overspending, but is set to break even in three years.

However, the Greek disease has been socialism, with parties outdoing each other to spend borrowed money to buy votes and evade economic reality.  Greece's economy has had to shrink, because it has been built on credit - not production.  The hard awful reality is that those who benefited from it, never have to pay it back, whereas the up and coming generation face paying for it.

Greece has had its economy destroyed not because of bankers, but because it was rotten at the core, sustained by socialist politicians and those whose support they gleaned by their bribery using borrowed money.   Since the early 1980s, more and more of the economy was built on nothing at all - sadly today, it isn't the public sector facing retrenchment and pain, but the private sector.   Increasing taxes and increasing tax collection is gutting the part of Greece's economy that is productive, and precious little is being done to gut the part that isn't/

France's road to disaster courtesy of Hollande

Detlev Schlichter on France:

In 2012, President Hollande has not reduced state spending at all but raised taxes. For 2013 he proposed an ‘austerity’ budget that would cut the deficit by €30 billion, of which €10 billion would come from spending cuts and €20 billion would be generated in extra income through higher taxes on corporations and on high income earners. The top tax rate will rise from 41% to 45%, and those that earn more than €1 million a year will be subject to a new 75% marginal tax rate. With all these market-crippling measures France will still run a budget deficit and will have to borrow more from the bond market to fund its outsized state spending programs, which still account for 56% of registered GDP.

If you ask me, the market is not bearish enough on France. This version of socialism will not work, just as no other version of socialism has ever worked. But when it fails, it will be blamed on ‘austerity’ and the euro, not on socialism.

As usual, the international commentariat does not ‘get it’. Political analysts are profoundly uninterested in the difference between reducing spending and increasing taxes, it is all just ‘austerity’ to them, and, to make it worse, allegedly enforced by the Germans. The Daily Telegraph’s Ambrose Evans-Pritchard labels ‘austerity’ ‘1930s policies imposed by Germany’, which is of dubious historical and economic accuracy but suitable, I guess, to make a political point.

Most commentators are all too happy to cite the alleged negative effect of ‘austerity’ on GDP, ignoring that in a heavily state-run economy like France’s, official GDP says as little about the public’s material wellbeing as does a rallying equity market in an economy fuelled by unlimited QE. If the government spent money on hiring people to sweep the streets with toothbrushes this, too, would boost GDP and could thus be labelled economic progress.