Time for a new political party?

[Vampire]

Governments are run by economists: the economic advisors are all trained economists, and the civil service is full of them.
Economists agree on fundamentals, as do the parties. The differences comes in the details in both parties and economists.

This is simpy wrong. Governments are not run by economists. Economists do give advice, but it is frequently ignored by politicians seeking political rather than economic ends. And political parties certainly do not agree on "economic fundamentals." If they did, the Eurozone economy wouldn't be in the mess it is in.

The way I see it, the economist is like a parent, the voters are like his children, and the politicians are the bad influences on those children that the parent warns about.

The children (like the voters) think they can have whatever they want regardless of whether it is affordable to the family budget. They think they can go out partying every night rather than doing their homework and there will be no consequences. They think they can indulge in binge drinking and smoking without health consequences.

The bad influences (like the politicians) encourage them in this foolishness, targeting them with advertising campaigns, seeking their “friendship” so they can be used, and generally leading them astray.

Only the parent (the economist) truly cares for his children and gives advice in their best interest: that there isn’t a money tree at the bottom of the garden so the children can’t have everything they want; that hard work at school is necessary if they are to make themselves employable and competitive in the future thereby gaining the means to pay their own way in the world.

Painfully for the economist (just like the parent), the voters (just like the children) often ignore him. We see the results in places like Spain where there is 50% youth unemployment. Surely you're not suggesting Governments there have agreed on economic fundamentals?

[Son of Leeds]

Here we see he need of the economist to find tidy relationships that produce predictable results. Not all parents, to keep with your analogy, care for their children, and not all economists have benevolent intentions. Like everyone else they are corruptible. You are making a logical mistake: failing to separate economic good sense with the people who make it. Put the economist in power and he becomes like a politician too and subject to the same pressures. You seem to think that politicians and economists are completely different people, but many MPs were economists before they went into politics - Gordon Brown, for example.

As for the debts of Spain, as an example, I'm not sure they are as great as were the debts of RBS in 2008. The banking system went wonky because economists came up with false models that the heads of those businesses could not understand and so could not criticise. It seems to me that the evidence of economists being benevolent is unhistorical. The great boom of Holland in the 17th century, Italian banking under the Medici's in the 15th century, or Britain in the early 19th was not led by economists. The Great Depression of the 30s was more the effect of govts. listening to economists than those events.

What you're arguing for is a priesthood of economists, always wise and benevolent. Allow any group special status and they use it to benefit themselves.

Neither is it true that politicians always lie to electorates. Sometimes they unite people for struggles ahead. There are many many examples of politicians sacrificing party advantage for national interest or justice. Pres. Johnson signing he civil rights bills commented that in doing so he had signed away the south for the Democratic party for a generation.

You need to read more history, Vamps.

[mi.mic.mick.mick jones]

It's a compelling argument Mick, about the private sector making money from the NHS. On the face of it you're morally right.

But if it really IS all about getting the best care for the patient then what do you do when, for example, it costs say £2m a year to provide a directly employed security guard service to hospital X and it can be contracted out to an external supplier for 20% less ?

Surely you can live with Securicor making a 5% profit on the job if the patients get an extra £400k a years worth of better drugs/ more nurses/superior equipment. If not, how do you justify to patients who are denied care or treatment that the reason they're being denied is because you can't stand the idea of a company making a profit ?

But how does the private company supply the service cheaper? By simply paying less for. Security guards, equipment etc. offering a poorer service purely so he can cream off a few bob for himself, cheapest is not always best...optimum is best.I had the misfortune of having to visit a poorly relative in pinderfields recently... Even the bed the bloke was lying in was rented from a private company....meaning some scrote is taking money from the NHS for renting beds to a hospital...you couldn't fucking make it up, this type of thing must be being repeated over the entire system, and to me, that's fraud, nothing else, like Arabs renting sand from somewhere.

[Blackwhite]

It's a compelling argument Mick, about the private sector making money from the NHS. On the face of it you're morally right.

But if it really IS all about getting the best care for the patient then what do you do when, for example, it costs say £2m a year to provide a directly employed security guard service to hospital X and it can be contracted out to an external supplier for 20% less ?

Surely you can live with Securicor making a 5% profit on the job if the patients get an extra £400k a years worth of better drugs/ more nurses/superior equipment. If not, how do you justify to patients who are denied care or treatment that the reason they're being denied is because you can't stand the idea of a company making a profit ?

But how does the private company supply the service cheaper? By simply paying less for. Security guards, equipment etc. offering a poorer service purely so he can cream off a few bob for himself, cheapest is not always best...optimum is best.I had the misfortune of having to visit a poorly relative in pinderfields recently... Even the bed the bloke was lying in was rented from a private company....meaning some scrote is taking money from the NHS for renting beds to a hospital...you couldn't fucking make it up, this type of thing must be being repeated over the entire system, and to me, that's fraud, nothing else, like Arabs renting sand from somewhere.

It's about to get a whole lot worse.

[jackos]

It's a compelling argument Mick, about the private sector making money from the NHS. On the face of it you're morally right.

But if it really IS all about getting the best care for the patient then what do you do when, for example, it costs say £2m a year to provide a directly employed security guard service to hospital X and it can be contracted out to an external supplier for 20% less ?

Surely you can live with Securicor making a 5% profit on the job if the patients get an extra £400k a years worth of better drugs/ more nurses/superior equipment. If not, how do you justify to patients who are denied care or treatment that the reason they're being denied is because you can't stand the idea of a company making a profit ?

But how does the private company supply the service cheaper? By simply paying less for. Security guards, equipment etc. offering a poorer service purely so he can cream off a few bob for himself, cheapest is not always best...optimum is best.I had the misfortune of having to visit a poorly relative in pinderfields recently... Even the bed the bloke was lying in was rented from a private company....meaning some scrote is taking money from the NHS for renting beds to a hospital...you couldn't fucking make it up, this type of thing must be being repeated over the entire system, and to me, that's fraud, nothing else, like Arabs renting sand from somewhere.

A company running hospitals n old folks homes in Sweden had few great ideas, they weigh 'nappies' to see if they have enough piss in them n needed changing, they only order half the portions of food cause the pensioners didn't eat a full portion ( cause the food is pre-packed shit you silly cunts ), got rid of all the qualified staff.. You'd be surprised how much money you can make out if privately run schools, clinics, hospitals etc if you are careful with costs. The Swedish companies are so successful that they are winning bids in the UK n all. We are very proud of them I can tell you.

[Vampire]

SOL, there are so many logical problems and factual errors in your post I scarcely know where to begin.

not all economists have benevolent intentions. Like everyone else they are corruptible….. Put the economist in power and he becomes like a politician too and subject to the same pressures.

I never claimed that all economists are incorruptible. We are human and therefore no more and no less corruptible than any other fallible group of humans. A Government of economists would, however, be subject to the same accountability, transparency and anti-corruption controls as any other Government so this is not really relevant to whether or not we would provide better or worse government than today’s political parties.

My argument was not that we are less corruptible, it was simply that we would manage the economy better thereby generating more prosperity to meet the needs of the people.

You seem to think that politicians and economists are completely different people, but many MPs were economists before they went into politics - Gordon Brown, for example.

Factually incorrect – perhaps it is you who should read your history? Gordon was a history graduate and worked as a lecturer and journalist before entering politics. I’m pleased you have mentioned him though, because he was a rare example of a political leader who listened to economic advice, grasped what he was being told, and usually demonstrated good economic judgement.

As for the debts of Spain, as an example, I'm not sure they are as great as were the debts of RBS in 2008.

Spain’s debts (as a % of GDP) are not as large as Greece or Italy, or indeed the USA or UK. They do, however, have a credibility problem because the 2011 deficit was 8.5% of GDP despite a previous commitment to 6%, and their Government did itself no favours by rewriting the agreement with the EU for a target of 4.4% of GDP this year – unilaterally declaring the target should be increased to 5.8% before rowing back to 5.3% (nothing spooks markets more than undershooting expectations and breaking previous promises).

My main criticism of Spain, however, for some time (read my previous posts) has not been its debts , but its low productivity and competitiveness mainly because it ignores economic fundamentals in its labor market. That is where it has consistently ignored external economic advice and that is why it has an unemployment rate of 24% and youth unemployment of 50%.

I'm not sure they are as great as were the debts of RBS in 2008. The banking system went wonky because economists came up with false models that the heads of those businesses could not understand and so could not criticise.

Here you are really out of your depth lecturing on things you appear to know nothing about. RBS was not brought down by the advice of economists and I notice you provide no substantiation for such an absurd claim. The Executive Directors of RBS, e.g. Goodwin, Cameron, Pell, Fisher, who made the key decisions on the RBS Board are not (to my knowledge) economists. Most of them are career bankers.

The due diligence on RBS’ disastrous purchase of ABN Amro would have been done by accountants, not economists. Innovation in financial products such as securitised mortgages, e.g. CDOs, was not the creation of economists. The models to calculate risk associated with such products would have been done by the geeks and quants in the market and credit risk departments – not the Group economist. We have no say in the design of incentivisation and bonus schemes that encourage the booking of short term sales at the expense of long term risk. As someone who has spent some of his career in financial services I know these things – you are just spinning an inaccurate yarn to suit your argument.

The role of the Group Economist in a financial services institution like RBS is to monitor and analyse global economic markets and trends to identify opportunities and threats for banking products. We do not run our banks or have an executive say in their decisions.

It seems to me that the evidence of economists being benevolent is unhistorical. The great boom of Holland in the 17th century, Italian banking under the Medici's in the 15th century, or Britain in the early 19th was not led by economists. The Great Depression of the 30s was more the effect of govts. listening to economists than those events.

Questioning the economics profession in the 15th or 17th century would be like questioning the medical profession back then for practicing lobotomy or putting leeches on people. These were not modern developed professions back then.

Again, you provide no substantiation for your assertion that the Great Depression was caused by economists, but I am prepared to concede that back then the profession was still in its infancy and we did not understand what was going on as we do now. What we learned from those events, for example through the ground breaking work of economists such as Keynes and Fisher, was instrumental in preventing the banking crises and recession of 2008 from turning into another full blown depression. The UK rescue scheme by Gordon Brown (who listened to his economic advisors), copied in the USA and EU, really did save the world from financial and economic collapse just a few years ago. And this was largely thanks to economists.

[Blackwhite]

The History of Progress in Economics:

"Give this guy money. Then all will be well."

"Ah. OK. Got it. Try this."

"Ouch. It's alright... Try that."

"FUCK! OK, I think I've thought of something cool..."

"Erm... this is due to that, I think. If we do this, we;ll be fine."

Etfc. It's more art than science, and if it looks scientific it's usually a trick. Fraud. Imposture.

[gazurtoids]

Indeed. The dismal science, in't it?

[Blackwhite]

Indeed. The dismal science, in't it?

Actually, the Gay Science has a lot going for it.

[WHITETHROUGH]

Political parties run by economists .....You could argue for Political Parties run by Scientists, Physicists and Engineers, at least the bullshit counter would be low as the sums would add up.

[gazurtoids]

Political parties run by economists .....You could argue for Political Parties run by Scientists, Physicists and Engineers, at least the bullshit counter would be low as the sums would add up.

I would offer my vote but... have you seen academic politics?!

[WHITETHROUGH]

Political parties run by economists .....You could argue for Political Parties run by Scientists, Physicists and Engineers, at least the bullshit counter would be low as the sums would add up.

I would offer my vote but... have you seen academic politics?!

The highlight of my week is an Engineering meeting

It is brutal.

There is nothing fluffy and bollox is an often used term. The Academic politics and harsh intellectual bullying is cruel, and I learned early on never to say ‘I think’...everything must add up and if it doesn’t you go away and do it again. I am so prepared for these meetings and nothing is left to chance...I love being an Engineer

[Vampire]

The History of Progress in Economics:

"Give this guy money. Then all will be well."

"Ah. OK. Got it. Try this."

"Ouch. It's alright... Try that."

"FUCK! OK, I think I've thought of something cool..."

"Erm... this is due to that, I think. If we do this, we;ll be fine."

Etfc. It's more art than science, and if it looks scientific it's usually a trick. Fraud. Imposture.

You should have brought your interpreter with you. Or, perhaps you don't really have anything to say on this subject and therefore prefer to hide behind a veil of ambiguity in the hope some people might think you're making a profound statement they don't understand when really it is you that has no kowledge or expertise in the subject matter.

I notice you are unable to critique, contradict, or challenge anything I have actually posted in defence of economists, nor are you able to put forward a rational and clear argument of your own. Maybe that is wise. Last time you tried to be more explicit (your post on Greek default) you made a fool of yourself and were easily ripped apart. You would be so again if you engaged in open debate - hence your preference for this sort of meaningless opaque dribble.

Stick to petri dishes, Blackwhite, you are clearly out of your depth on economics.

[Blackwhite]

Stick to petri dishes, Blackwhite, you are clearly out of your depth on economics.

Well, you are probably right. However as you know, my contention is that you are as well. (And you would be even if you were that which you purport to be )

[Vampire]

Stick to petri dishes, Blackwhite, you are clearly out of your depth on economics.

Well, you are probably right. However as you know, my contention is that you are as well. (And you would be even if you were that which you purport to be )

Blackwhite, you really must get over your obsession with me. You profess no interest in economics, but can’t resist stalking me on economics threads. You have even stalked me on cricket threads despite confessing no interest in that game. Your purpose is not to contribute to the subject matter, but merely to have an irrational crack at me.

Many of your posts on this Board are negative and spiteful (and not just towards me). You need to appreciate an old lesson that having poison inside you damages you more than those you hate. A lot of your anger seems directed at those more successful than you, but envy is just the sort of poison I’m talking about.

Accept your station in life Blackwhite. Be comfortable in your own skin. Have joy in your heart, and spread joy to others. You’ll feel better for it.

[Vampire]

The highlight of my week is an Engineering meeting

It is brutal.

There is nothing fluffy and bollox is an often used term. The Academic politics and harsh intellectual bullying is cruel, and I learned early on never to say ‘I think’...everything must add up and if it doesn’t you go away and do it again. I am so prepared for these meetings and nothing is left to chance...I love being an Engineer

An interesting post, Whitethrough, and I assure you meetings I run are also results focussed and intolerant of bullshit. As an engineer, I’d be interested in your thoughts on a subject I have recently been thinking about.

At a time when most of the developed world has been losing manufacturing exports as a result of foreign competition (particularly in Asia), and shrinking their manufacturing sectors, how has Germany been able to buck the trend and continue to grow its exports particularly of engineering products (vehicles, machines, electronic devices, and chemicals account for more than half of Germany’s exports)?

How have the Germans managed to remain competitive (despite paying higher wages) than the competition in Asia? How have they maintained their reputation for quality (I still rank the Audi as the best car I have ever driven and our Miele washing machine is simply a different class to anything we’ve had before)?

Sure, there’s some obvious economic arguments such as their liberalised labor market (youth unemployment is 8.2% compared with 50.5% in Spain), and they invest more in training and apprenticeships – prizing relevant jobs based training above PhDs from third rate universities in obscure subjects whether peer reviewed or not.

But there must be more to it? As an engineer, what do you think of German engineering and why does it remain so competitive and ahead of the game?

[Dale White]

http://en.wikipedia.org/wiki/Vorsprung_durch_Technik

[WHITETHROUGH]

Vampire,

An interesting post, Whitethrough, and I assure you meetings I run are also results focussed and intolerant of bullshit. As an engineer, I’d be interested in your thoughts on a subject I have recently been thinking about.

At a time when most of the developed world has been losing manufacturing exports as a result of foreign competition (particularly in Asia), and shrinking their manufacturing sectors, how has Germany been able to buck the trend and continue to grow its exports particularly of engineering products (vehicles, machines, electronic devices, and chemicals account for more than half of Germany’s exports)?

How have the Germans managed to remain competitive (despite paying higher wages) than the competition in Asia? How have they maintained their reputation for quality (I still rank the Audi as the best car I have ever driven and our Miele washing machine is simply a different class to anything we’ve had before)?

Sure, there’s some obvious economic arguments such as their liberalised labor market (youth unemployment is 8.2% compared with 50.5% in Spain), and they invest more in training and apprenticeships – prizing relevant jobs based training above PhDs from third rate universities in obscure subjects whether peer reviewed or not.

But there must be more to it? As an engineer, what do you think of German engineering and why does it remain so competitive and ahead of the game?

As you have asked here are some of my general thoughts on engineering both here and abroad.

I work for a company that develops and sells all around the world a high end Physics/ Engineering / Software based product with an excellent mark up. I don’t particularly want to get in to what we sell other than we only have two other competitors. The Germans are not one of them.

Because of the difficulty of producing this product the Japanese and Chinese have both attempted to copy and develop it and fallen flat on their faces...ahem!

Obviously you have to ask the reason why.

Firstly there is a particular quirky British way of developing risky and often blue sky products...we just take a chance after some initial work and turn it on. If there is smoke you re-engineer and learn very quickly. What this enables you to do is make intellectual ‘big steps’.

The Japanese especially have a small iteration approach; they end up with a Master- Student relationship type of thing! It takes them a long time to get it right and because they are an honour based society where failure is frowned upon they hide things and lie. They are not the best as solving problems and if there is no manual they tend to struggle. Do you really think the problems at Fukushima are under control, I have my doubts!

Here is an example of the Japanese approach. During World War2 for the best part they came up with Suicide Bombers and on our side we invented the Nuclear Bomb.

As for the Chinese well we all know they like to copy things. There are problems with this approach as the original product if it has enough complexity can always stay one step ahead of them. There is the British ‘fault’ approach where known faults are designed and left in the earlier products with complex and time consuming problem solving required. These problems were noted at the ‘smoke’ stage. Also releasing complex patents which require a lot of work to eventually find they actually don’t work like they are intended are an excellent ruse to keep the Far East occupied.

The Yanks are also very British Orientated in their approach and so end up being natural competitors. I like the Yank Engineering and I think that is reciprocated...they have nicked a bit of us including what we manufacture as well as a lot of German stuff...we all nick of each other!

The Germans as you have highlighted have some very good products and I know they got in to China very quickly and the Chinese are lapping it up. But they have started to make mistakes with their usual methodical and knowledge based approach by trying to adopt a Japanese style manufacturing and design approach which I think is stifling them. I recon because of demographic issues in there ‘Grey Haired ‘Engineering community they are starting to get a bit lazy or desperate?

As for us well we still punch above our weight in Engineering/ Science and Technology not helped by a general misunderstood position from poor Government during the last 25-30 years.

I know some of my opinions are generalised but I have worked on some very high tech projects with some clever people in my time and the Far East isn’t all it’s cracked up to be. In the West we can out think these people and still come out on top, we have no choice now we just got to roll our sleeves up.

[gazurtoids]

I don't think there is a demographic problem with engineering in Germany. It's very well respected as a discipline, unlike in the UK, and they seem to train plenty. I am basing this on the University I work in though, rather than having hard numbers to hand. The German chemical industry also appears to be far bigger than ours.

[Vampire]

Vampire,

An interesting post, Whitethrough, and I assure you meetings I run are also results focussed and intolerant of bullshit. As an engineer, I’d be interested in your thoughts on a subject I have recently been thinking about.

At a time when most of the developed world has been losing manufacturing exports as a result of foreign competition (particularly in Asia), and shrinking their manufacturing sectors, how has Germany been able to buck the trend and continue to grow its exports particularly of engineering products (vehicles, machines, electronic devices, and chemicals account for more than half of Germany’s exports)?

How have the Germans managed to remain competitive (despite paying higher wages) than the competition in Asia? How have they maintained their reputation for quality (I still rank the Audi as the best car I have ever driven and our Miele washing machine is simply a different class to anything we’ve had before)?

Sure, there’s some obvious economic arguments such as their liberalised labor market (youth unemployment is 8.2% compared with 50.5% in Spain), and they invest more in training and apprenticeships – prizing relevant jobs based training above PhDs from third rate universities in obscure subjects whether peer reviewed or not.

But there must be more to it? As an engineer, what do you think of German engineering and why does it remain so competitive and ahead of the game?

As you have asked here are some of my general thoughts on engineering both here and abroad.

I work for a company that develops and sells all around the world a high end Physics/ Engineering / Software based product with an excellent mark up. I don’t particularly want to get in to what we sell other than we only have two other competitors. The Germans are not one of them.

Because of the difficulty of producing this product the Japanese and Chinese have both attempted to copy and develop it and fallen flat on their faces...ahem!

Obviously you have to ask the reason why.

Firstly there is a particular quirky British way of developing risky and often blue sky products...we just take a chance after some initial work and turn it on. If there is smoke you re-engineer and learn very quickly. What this enables you to do is make intellectual ‘big steps’.

The Japanese especially have a small iteration approach; they end up with a Master- Student relationship type of thing! It takes them a long time to get it right and because they are an honour based society where failure is frowned upon they hide things and lie. They are not the best as solving problems and if there is no manual they tend to struggle. Do you really think the problems at Fukushima are under control, I have my doubts!

Here is an example of the Japanese approach. During World War2 for the best part they came up with Suicide Bombers and on our side we invented the Nuclear Bomb.

As for the Chinese well we all know they like to copy things. There are problems with this approach as the original product if it has enough complexity can always stay one step ahead of them. There is the British ‘fault’ approach where known faults are designed and left in the earlier products with complex and time consuming problem solving required. These problems were noted at the ‘smoke’ stage. Also releasing complex patents which require a lot of work to eventually find they actually don’t work like they are intended are an excellent ruse to keep the Far East occupied.

The Yanks are also very British Orientated in their approach and so end up being natural competitors. I like the Yank Engineering and I think that is reciprocated...they have nicked a bit of us including what we manufacture as well as a lot of German stuff...we all nick of each other!

The Germans as you have highlighted have some very good products and I know they got in to China very quickly and the Chinese are lapping it up. But they have started to make mistakes with their usual methodical and knowledge based approach by trying to adopt a Japanese style manufacturing and design approach which I think is stifling them. I recon because of demographic issues in there ‘Grey Haired ‘Engineering community they are starting to get a bit lazy or desperate?

As for us well we still punch above our weight in Engineering/ Science and Technology not helped by a general misunderstood position from poor Government during the last 25-30 years.

I know some of my opinions are generalised but I have worked on some very high tech projects with some clever people in my time and the Far East isn’t all it’s cracked up to be. In the West we can out think these people and still come out on top, we have no choice now we just got to roll our sleeves up.

Thanks, Whitethrough.

Some interesting insights - though as a natural born sceptic you won't be surprised that I am not completely convinced.

From what you have said, I suspect yours is a niche market. A niche market can always do well, but UK manufacturing and engineering in general is in decline.

You're right that Japan is in serious trouble. Some of this is down to more than a decade of economic underperformance - low growth and deflation (japanese consumers hold off buying products because with deflation they will always be cheaper tomorrow), but also some of their big companies have lost the plot. Sony - which invented the Walkman - has simply not kept pace with, for example Apple, which killed the walkman with the Ipod. Samsung sells twice as many tellies as Sony today (though I have to admit we still have Sony tellies in our house as they are a superior product).

But you say little of Germany. It is an engineering success story that stands out in the world economy and therefore fascinates me. I'm not sure I agree that "demographic issues in their ‘Grey Haired ‘Engineering community they are starting to get a bit lazy." Demographic issues are certainly a big issue in Germany particularly in relation to their State spending on pensions for example, but I think you may be under-estimating their model on training and apprenticeships. The more I think about it that could be the key to their success. They really do prize training in real world skills over the sort of duff meaningless degrees in obscure academia and arts practiced elsewhere. They also prefer economists to accountants (but that is a different matter). Then again, they don't produce much decent art or pop music!