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From Arse To Elbow
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Virtue in philosophy is right behaviour, which means it is a social construct, not some eternal verity. Bankers have always considered themselves to be part of a special club, with its own norms and standards. It should come as no surprise that those norms are self-serving. Much of the current bleating about virtue is unthinking nostalgia for the days when banking was run by "the right sort", which just meant that market-rigging was hushed up for the sake of The City's reputation. While bankers have power, they will avail themselves of the opportunities.
@aragon, the cost of IT per se is not large, and has been steadily falling since the 80s. Government IT projects spend only a tiny fraction of the budget on technology, in the sense of computing or comms hardware and software. The bulk goes on consultancy and professional services, i.e. people costs, including both up-front implementation and ongoing support. These costs are vastly inflated (e.g. dim grads on £21k p.a. are charged out at £500 per diem), hence the £7.6bn gross. The growth of the IT sector (in terms of employment) has been driven by the proliferation of management roles (project management, testing, training etc), rather than technologists. It has also been muddied by the overlap with pseudo-tech roles in marketing and PR. Consultancy fees have risen steadily over the last 25 years as the unit costs of hardware and software have fallen. In the mid-80s, a large IT project would have an 80:20 ratio between technology and people. That has now flipped. This is not because we need more people input, but because the market can bear the continuation in top-line price. The radical impact of ICT is obscured by rent-seeking.
Toggle Commented 4 days ago on On crowding out at Stumbling and Mumbling
Re "there are also, I fear, fewer highly intelligent working class autodidacts". But (to employ a favourite question of your own) what would be the mechanism for that? Are they being bred out? Is there something in the water? By definition, autodidacts have avoided (willingly or not) the conventional academic routes, so the increased managerialism and homogenisation of modern education cannot be to blame. Not every public library has closed, and the Internet is surely a boon in this regard. Your suggestion that there may be a specific quantum of diversity, and that this budget has been used up by "women, blacks and gays", is probably true, but the implication that this allowance was previously monopolised by working-class autodidacts probably isn't. I suspect the likes of Bob Crow and Bob Hoskins are still out there, despite the battering of organised labour and the reduction in social mobility. You're getting nostalgic.
Toggle Commented 6 days ago on Repressive diversity at Stumbling and Mumbling
@aragon, you've listed examples of government projects that successfully transferred large amounts of public money to privileged suppliers. These are not "failures" but successful extortions (government incompetence as a project manager is largely a cover-story). This tells us nothing about aggregate investment in the wider economy, unless you're supporting Jackart's contention that every £1 spent by government necessarily depresses private investment by £1.
Toggle Commented 6 days ago on On crowding out at Stumbling and Mumbling
@aragon, "it was too easy to make a profit without investment". No. What happened was that the cost of investment fell. Or, to put it another way, ROI dramatically increased. Re "lower labour costs [=] no need to invest in plant and equipment". Lower labour costs do not save on plant (i.e. factory space) and may in fact drive demand up due to labour-capital substitution. Manufacturing continues to invest in capex, but this is increasingly marginal to the wider economy. In the UK, it accounts for 12% of GDP on 8% of the workforce. Also, bear in mind that an increasing part of manufacturing is making the robots that are now substituting for labour in China (much as German manufacturing thrived on their demand for machine tools since the 80s). Low wages can depress capex in services (e.g. manual carwashes instead of automatic), but the bulk of labour growth (particularly immigrants) has been in areas with traditionally low levels of automation, such as restaurants, plumbing, cleaning etc. The typical UK work environment is neither a factory nor a restuarant, but an office. Over the last 20 years, we have seen the capex cost of IT per desk plummet, both as a result of commoditisation (i.e. China and robots) and the shift from hardware to software (the Internet, the "cloud", SaaS are all examples of this compositional change). The problem is not a lack of will to invest, but a lack of expensive investment opportunities. In the short term, this frees up cash for increased dividends, executive bonuses, and make-jobs in marketing and HR. In the long term, it can lead to stagnant productivity growth as antiquated organisational structures ossify. This is what gives rise to the perception of a "lack of innovation". It is a morbid symptom that doesn't reflect the real transformative impact of technology since the 90s.
Toggle Commented 7 days ago on On crowding out at Stumbling and Mumbling
Re "There was no-one to invest with, thanks to a more controlled labour market, and thanks to an absurd regulatory raj, investment was less profitable". The UK labour market is widely acknowledged to be one of the most flexible in the developed world, regularly held up as a paragon by such lefty outfits as the OECD and IMF, as well as the WEF referenced by paulc156. This didn't happen overnight in 2010, but is the product of many years of deregulation from Thatcher through Brown. New Labour may have introduced the minimum wage, but it also watered down the EU Working Time Directive and Part-Time Workers Regulations. It also made it progressively easier to hire and fire workers and limited recourse to employment tribunals. Anyone who was an employer over the last 20 years knows this. Business regulation, far from being inimical to capital investment or profit, is actually a key driver of both. Regulation raises the cost of market entry for new competitors and privileges large businesses (who can access cheaper capital) over small. This is why large companies and multinationals tend to be in favour of the EU, which is essentially a big capital lobby. The downward trend in capital investment has been happening since the 1980s, but significantly profits have held up over the same period. This is because capital has become more profitable. Some of this is due to globalisation (e.g. investing in China), some due to a glut of commercial property for lease (so less capital is tied up in plant), but an arguably more profound factor has been the compositional change in capex caused by the growth of software relative to hardware (I disagree with Chris that technical progress has been "slower", its just taken a form that many economists struggle to understand).
Toggle Commented Jul 23, 2014 on On crowding out at Stumbling and Mumbling
I think you're unnecessarily narrow in identifying Blair's "managerialist ideology" as his weakness. This was clearly just an aspect of a wider commitment to neoliberalism at home and abroad, which included the privileging of The City, his mugging by US neocons over Iraq, and his subsequent ascension to the global 0.01% Janan Ganesh makes the astute point that "he did not come from anywhere in particular". His problem was not over-confidence, but a lack of the groundedness that encourages caution or scepticism. It's worth remembering that long before the "Bliar" meme, his nickname was "Bambi".
Toggle Commented Jul 22, 2014 on Blair's legacy at Stumbling and Mumbling
Football clubs usually start as player-owned but are taken over (often by a minority of ex-players) once they require capitalisation (e.g. for a permanent ground). As the club becomes more successful, so its capital increases (i.e. the capital value of the club, not the players who are pseudo-capital). Thus there will always be more player-owned (i.e. amateur) clubs than pro outfits. All this tells us is that when an opportunity for profit arises, capital moves in. This is why Barcelona, for all their 'Mes que un club' schtick, have sold shirt-sponsorship rights to Qatar Airways, Nike and Beko. Paul Walker's suggestion that worker-control tends to thrive in environments with homegenous skills, little organisational hierarchy, and simple decision-making, could be reinterpreted to say that worker control tends to occur where there is a high percentage of variable capital (i.e. labour). In other words, it tends to be factor-contigent. This suggests that the limited success of worker control is as much about the secular trend of capital-labour substitution through automation as it is about an inhibiting ideology.
Toggle Commented Jul 20, 2014 on Why not worker control? at Stumbling and Mumbling
Given Montgomerie's audience at The Times and elsewhere, I suspect the answer to your closing question is yes.
Toggle Commented Jul 17, 2014 on Forced into work? at Stumbling and Mumbling
The Internet (i.e. online job sites) does not provide an accurate representation of the jobs market. Most job ads are placed by recruitment agencies, not by employers, and most of them are CV bait rather than real jobs. If the Internet was going to improve job search and matching, it would have disintermediated recruitment agencies by now. The challenge agencies faced with the arrival of the Internet was that advertising was no longer expensive. Previously, large agencies could dominate the page advertising in newspapers and specialist mags, keeping small competitors out through high prices. With low costs for online ads, they could only preserve their dominant position (in terms of hoovering up candidates coming onto the market) by massively increasing the number of adverts they placed. The global coverage of the Internet also resulted in the growth of CV spam (unqualified candidates applying for everything because email is cheaper than photocopies and stamps). This proved to be a good thing for agencies as they justify their fees in part by "screening" these out. The more noise, the better. In other words, the increased efficiency of search has been offset by the massive degradation of the (virtual) database.
Given the ample evidence of Cameron and Osborne's prior contempt for IDS's intellectual and managerial abilities, I don't think this can be explained by any theory that rests upon their delusion. More likely is that IDS remains in post because he is, in their eyes, a success. Perhaps we've just misunderstood that the brief was to knacker the benefits system so that claimants increasingly give up, while shovelling large amounts of public money to favoured suppliers. He's certainly done a good job in proving the incompetence of the state in managing services.
Toggle Commented Jul 15, 2014 on Why idiots succeed at Stumbling and Mumbling
The irony of Larry Page opining on reduced working hours is that Google are famous for doing everything to keep their employees working, from desk-side massages to free food and onsite laundries. Their approach is more akin to a cult (satirised by Dave Eggers' The Circle), which harks back to the monastic order origins of factory discipline. Factory time is the product of technology, in the form of concentrations of capital such as power looms (more profitable than piece-work, i.e. "putting out"), and the discplinary need to prevent "soldiering" through regulation (i.e. controlling work speed) and surveillance. This provided the template for all subsequent work organisation, from banks of desks and open-plan offices through realtime monitoring and hidden cameras. The Googleplex environment is less about capitalists maximising labour and more about the way that work is becoming a positional good as employment bifurcates into a high-status clerisy for whom the boundary between work and non-work increasingly evaporates, and a low-status proletariat whose labour time is increasingly fragmented and commoditised.
Toggle Commented Jul 15, 2014 on Time at Stumbling and Mumbling
The Easy Street of the old City was largely the prerogative of partners, not the more humble middle-class employees. Those partners weren't edged out by changing norms, they sold out to US firms. I'm sceptical that the "easy middle-class life" has gone. Large businesses are awash with overpaid and supernumerary IT, marketing and HR types. Times change: liquid lunches, like desktop ashtrays, were the product of a predominantly male environment. Now we have digital gossip and cat memes.
@Jim, the process of removing items from raion began in 1948 under Labour, starting with bread and clothes. There was no ideological difference between the parties on the subject, though the Tories campaigned on the false claim that there was. The biggest factor in the timeline for the end of rationing was the balance of payments. Imports had to be choked until domestic and export production was converted from wartime use. On top of this, the US insistence on early replayment of Lend-Lease made hoarding Dollars the priority. This meant minimising spending outside the Sterling area, hence imported items such as meat (from South America), wood (from Scandinavia for furniture), sugar (and thus sweets) and (famously) bananas were only taken off ration later on. The timeline of UK rationing owed more to US economic power and intransignece at Bretton Woods than it did to the killjoy spirit of socialism.
Toggle Commented Jul 6, 2014 on Incomes & satisfaction at Stumbling and Mumbling
I think there is more to it that just technology, though that is unquestionably the dominant manifestation. The dynamic is necessity. For example, when faced with an existential threat, we can rapidly amend centuries-old customs. Thus women take on manual labour during wartime. But, when necessity weakens, we're happy to revert to older customs. Thus women lose their jobs at the end of war and are exhorted to return to breeding and homemaking. This might suggest that a narrowing in the pay gap is superficial and that innate sexism remains strong, which would certainly explain why the advance of female employment over the last twenty years has been paralleled by the expansion of Spearmint Rhino et al. That said, necessity/technology (the base) must gradually temper custom (superstructure). The Aussie evidence of persistent sexism is about relative degree - i.e. some areas are laggards but the overall direction of travel is common.
The Tories have been a periodically unstable alliance of different capital interests since the days of Robert Peel. Arguably, the intermittent Parliamentary success of the "progressive" opposition, from Liberals to Labour, has depended on division in the Tory ranks (protection vs free trade, Europe vs empire etc). Big capital (pro-EU and pro-state contracts) has conflicting economic interests with small capital (anti-regulation, pro-wage repression). The decisive factor has long been finance capital, which is part of the reason for the imbalance of power in the modern economy. The resolution of the current iteration of Tory strife will depend on the City's calculation of where its best interest lie, which is why the guff about EU tretay renegotiation ultimately boils down to removing constraints on finance - i.e. if Cameron can preserve the City's privileges, the small capitalists can go hang. Until then, UKIP are useful idiots.
Toggle Commented Jul 2, 2014 on Tories for whom? at Stumbling and Mumbling
The solution is surely a variation on the Texas Rule: oblige the Russell Group to take students on a pro-rata basis across all schools / 6th form colleges - i.e. each school has a guaranteed number of places (approx 10) that are available to the highest achieving pupils. This would incentivise the rich to maximise their child's chances of selection by evenly colonising state schools. Congregating in public schools would be counter-productive if you wish to go on to study Law at Oxford or Medicine at Imperial. While some will wish to preserve the public schools for reasons of sentiment, those that don't close/convert would quickly revert to their ancient, pre-Arnoldian function of servicing the dim offspring of the rich, who will continue to progress to the study of Art History at St Andrews.
Toggle Commented Jun 20, 2014 on School utopianism at Stumbling and Mumbling
@Dipper, the ICT sector accounts for 3% of the UK workforce. It's still growing, but not as fast as in the past. Growth in the 80s and 90s was driven by hardware. Since 2000, growth has shifted to software as hardware has been commoditised and offshored. Software employs relatively few people directly due to a) its marginal cost of production being near zero, and b) the tendency towards monopoly (most people use one search engine, not several). Silicon Roundabout really is as small as the name suggests. Most ICT professionals are actually species of middle management in non-IT firms rather than techies, which means their employment ultimately depends on corporate norms rather than discernible value. The scope for "more and more" jobs is slight, despite government and industry propaganda. The issue is not a one-for-one substitution of robots for people, but the replacement of entire industries by cheap software (often cobbled together opensource) running on even cheaper hardware. There is no iron law that says new technologies create more new jobs than those they displace.
Toggle Commented Jun 19, 2014 on Miliband's managerialism at Stumbling and Mumbling
With the passage of time, many people have become misty-eyed about Thatcher's Enterprise Allowance Scheme, in no small part because of atypical succes stories such as Creation Records and Viz. Though its macroeconomic impact was negligible (it largely funded sole traders who would have become self-employed anyway), it represented an attitude towards personal responsibility and the role of government largesse that now, after 30 years of managerialism, appears revolutionary: give the kids some cash and let them get on with it. What's depressing about Labour's plan (and the whole fetishisation of the contributory principle by the IPPR and Blue Labour types) is the lack of both imagination and ambition. They simply don't trust the people they puport to represent.
Toggle Commented Jun 19, 2014 on Miliband's managerialism at Stumbling and Mumbling
One of the positive effects of Piketty et al has been to shift the focus of the debate on social mobility away from the failure of the poor to haul themselves up to the persistent immobility of the rich. Greg Clark's voguishness owes much to the ideological need to find an alternative explanation to power and privilege, hence the ready eliding by many of the neutral "inter-generational transmission" to the more pernicious idea of "social competence" as a genetic trait. We should never forget that most immigrants are not illiterate peasants, stowing away on lorries, but middle class professionals and skilled workers who not only have "get up and go" but the financial resources necessary to move country. They are the Daily Mail readers of tomorrow.
Toggle Commented Jun 19, 2014 on The poor white problem at Stumbling and Mumbling
Mensch's failure to appreciate the Burkean debt of the present to the past would be amusing if it were not for her insensitive language: "They were mostly kids and teens. It's absolutely immoral to blame them." Yeah, that's what we thought in 1989.
Toggle Commented Jun 17, 2014 on History's winners at Stumbling and Mumbling
A distinction needs to be made between "expert commentators" and "pundits". The former are chosen to illuminate the action with a pro's insights, but the nature of the (TV) product means they have to be be uncontroversial and avoid detracting from the lead commentator (i.e. play straight man to the wit), so the insight in often vapid. The criticism of Neville, Carlisle, Townsend, Keown etc is not their susceptibility to cognitive biases (which is no worse than the norm), but that they are boring. That said, an interesting subplot of this World Cup is that some, like Neville and Keown, have started to advocate fouling as a "technical" aspect of the game, which is genuinely insightful, if hardly eye-opening. In contrast, pundits are chosen for their metrosexual attraction: hooded eyelids, lambswool cardies, sonorous Cointreau advert verbals etc. Shearer and Savage are there purely to reassure us that it's perfectly hetero to watch 3 well-groomed men (and Adrian Chiles) airing their crotches. PS The smart money is on Germany at sixes.
@Christian Hofman, it's entirely possible for productivity to be weak as robots march on. Though we assume that automation starts at the bottom, and raises per capita productivity, this only occurs where wages are high (hence why car production was such an inviting target in the 70s/80s). Technological advance gradually pushes automation up the wage scale, where the benefits of substitution (i.e. the cost of labour) are greater. This leads to polarisation, with previously well-paid labour pushed down the wage scale (the growth of the self-employed is one aspect of this). This can produce stagnant productivity as cheap labour makes automation uneconomic at current prices, and can even push productivity down if labour starts to substitute for capital (e.g. automatic car-washes give way to manual ones).
Toggle Commented Jun 12, 2014 on The productivity slump at Stumbling and Mumbling
If by values we mean distinctive social norms, rather than culturally-determined habits, such as queuing or sentimentalising pets, then we run into the problem that many of these values conflict. For example, Britain's great contribution to philosophy is empiricism and a rejection of the supernatural. This would suggest that the abolition of religious education is overdue. However, this conflicts with tolerance and pluralism, which suggests we really ought to let the Jedi open up faith schools. Perhaps the ultimate British value is skepticism that such a thing as "British values" actually exist.
Toggle Commented Jun 10, 2014 on "British values" at Stumbling and Mumbling
There are two tendencies at work: the desire of capital to extract the surplus value of labour, and the desire of privileged labour to extract rents (this is as prelavent in the private sector as the public). The latter depends on social interactions (meetings, politicking, developing tacit understanding etc), hence there remains a strong incentive to spend "face-time" in the office, even though many workers admit they get more done outside. The higher rate of remote working by senior managers is driven by status in three ways: the performative "always on" of the self-defined indispensable; the executive property right to "manage your own time"; and the early adoption of new technology (a symbol of corporate valuation, as cars once were).
Toggle Commented Jun 7, 2014 on The home-working puzzle at Stumbling and Mumbling