IEA Conversations
How can we make sense of the political realignment taking place in the United Kingdom?

How can we make sense of the political realignment taking place in the United Kingdom?

December 11, 2019

How can we make sense of the political realignment taking place in the United Kingdom?

In one of the very first Live from Lord North Street podcast episodes, the IEA’s Dr Stephen Davies discussed this topic with Kate Andrews. Having developed his political realignment theory for several years now, Steve offers in our podcast today an explanation the ongoing political realignment, particularly highlighted the UK’s general election. He discusses the triggers for change (including Brexit and the growing support for socialist ideas), the reshuffle of political structures, parties, voting blocs and redefinition of what it means to be on ‘the left’ and ‘the right’, both in the UK and abroad.

You can subscribe to this podcast on Apple Podcasts, Spotify and Podbean.

Why do democracies choose ‘bad’ policies?

Why do democracies choose ‘bad’ policies?

December 4, 2019

Darren Grimes, Digital Manager at the IEA, is joined by Professor Bryan Caplan, an American economist and author, who is currently sitting on the New York Times Best Sellers list with his latest book 'Open Borders'.

The United Kingdom is currently in a general election period that has seen a slew of spending commitments, politicians of all hues talk of the ‘good’ government can do and expressing the opinion that it is the job of government to identify and correct market failure. At the expense of groups like consumers and taxpayers.

Professor Caplan's sobering assessment in his 2007 book ‘The Myth of the Rational Voter: Why Democracies Choose Bad Policies’, argued that the greatest obstacle to sound economic policy is not entrenched special interests or rampant lobbying, but the popular misconceptions, irrational beliefs, and personal biases held by ordinary voters.

Professor Caplan lays out several ways to make democratic government work 'better' - for example, urging economic educators to focus on correcting popular misconceptions and recommending that democracies do less and let markets take up the slack. "The Myth of the Rational Voter" took an unflinching look at how people who vote under the influence of false beliefs ultimately end up with government that delivers lousy results.

Are the irrational preferences described by Professor Caplan in his book inevitable and hard wired? If so can they be countered? Is the only way to educate people in the sphere of economics, and if so does that imply that only people with an economics degree should be allowed to vote? What does Professor Caplan think about Jay Brennan's notion of epistocracy? As well as Brennan’s argument that if you are not well informed and know you are not you have a moral duty not to vote? They're all topics covered within the podcast.

You can subscribe to this podcast on Apple Podcasts, Spotify and Podbean.

Is poverty relative, or is it absolute?

Is poverty relative, or is it absolute?

November 28, 2019

When the early poverty researchers Charles booth and Benjamin Seebohm Rowntree visited the East End of London in the late 19th century, they found large numbers of people living in the most desperate poverty. Inadequate food and shelter and unsanitary conditions were commonplace for Booth, Rowntree, and their contemporaries.

Measuring poverty was a relatively simple matter of counting the number of people engaged in a daily struggle to exist in the face of absolute hardship. Today, measuring poverty in developed nations has become a far more complex and contested matter. The struggle to acquire the basic essentials of food, shelter and hygienic conditions no longer exists on such a widespread basis.

Indeed, it could be argued that it no longer exists at all in this country. But many people, including the UK government, and charities such as Oxfam, the Child Poverty Action Group, and the Resolution Foundation, believe that poverty remains rife in the United Kingdom.

The UK defines poverty as disposable income that falls below 60% of the national medium. But imagine a country in which the national median income is a million pounds, someone making £590,000 a year might well fall below the 60% of the median average income, but that person would hardly be impoverished.

Similarly, those making more $168, the actual median per capita income in Burkina Faso in West Africa, are no better off for their neighbor's poverty.

So are we getting poverty measurements wrong? Is poverty relative, or is it absolute?

Joining IEA Digital Manager Darren Grimes to discuss is Kristian Niemietz, Head of Political Economy at the IEA and author of the 2011 release 'A New Understanding of Poverty'.

Should we scrap the ‘hugely inefficient’ corporation tax?

Should we scrap the ‘hugely inefficient’ corporation tax?

November 21, 2019

The IEA's Economics Fellow Julian Jessop argues for the IEA podcast this week that whilst he welcomes both the Conservative and Labour Party's supportive soundings on targeting business rates as an area in need of reform, he views the whole corporation tax system as increasingly out of date too.

Julian views the Conservative Party’s plan to postpone further cuts to corporation tax as a "mistake", and indeed the Labour Party’s pledge to reverse the cuts, arguing that both ignore research showing more than half the burden is borne by workers; furthermore Julian says, corporation tax remains an inefficient way to raise government revenue and has a negative impact on both investment and entrepreneurship.

Darren Grimes, Digital Manager at the IEA, asks Julian to take him through his thinking on why he believes both the Labour Party and Conservative proposals on Corporation Tax aren’t right if the aim is to boost both investment and entrepreneurship.

You can subscribe to this podcast on Apple Podcasts, Spotify and Podbean.

From BBC to NBT: Is it time to scrap the fee?

From BBC to NBT: Is it time to scrap the fee?

November 14, 2019

The world in which the BBC operates has changed dramatically. Viewers and listeners have unlimited choice and are ruthlessly discerning. So, is it time to scrap the licence fee?

Today’s guest, the IEA’s Senior Academic Fellow, Professor Philip Booth, says that we should, arguing that the BBC funding model needs to be pulled into the 21st century. The UK has a long history of successful mutuals and co-operatives, Philip argues, that are popular with their members. Such an ownership model for the BBC would be fit-for-purpose in the modern broadcasting world, detach the BBC from the state, and promote real diversity of corporate structures in the world of media.

A re-modelled BBC could better leverage its brand internationally and be a commercial success as well as perform other less-overtly commercial functions that its member-viewers value.

You can subscribe to this podcast on Apple Podcasts, Spotify or Podbean!

Why has no other European country copied the NHS model?

Why has no other European country copied the NHS model?

November 7, 2019

No other European country has copied the NHS model in half a century. Almost all comparable countries use a mix of funding mechanisms, rather than relying on taxation alone, and most outperform the NHS in health outcomes.

UK cancer survival rates lag behind those of comparable countries, A&E delays are increasing, the number of operations being cancelled is dire, staffing rates are in freefall and the tick-box target culture is sending doctors and dentists screaming into the private sector. The UK has one doctor for 356 people, against a developed world average of one for 277.

The NHS’s archaic divisions of labour between GPs, hospital doctors, pharmacies and clinics is now indefensible. So too is the division between the NHS itself and social and domiciliary care. As any victim of these restrictive practices knows, treatment delayed is treatment denied.

Sooner or later, the pressure of demand (now from all age groups) will force the NHS to choose between rationing by some form of means-tested pricing or by further bureaucratic delay. Last year’s Guardian survey of foreign systems showed there were plenty of other ways to organise public health. Before the coming of the NHS, London’s (local) health service was regarded as the best in Europe. It is not that now. 

So what are the alternatives? 

In countries without the NHS what does healthcare and insurance look like for sick, older or poorer people? Are the rich able to purchase a luxury tier of healthcare and what happens if your insurer goes bankrupt in countries like the Netherlands, Switzerland, Germany, Belgium or Israel?

To discuss, the IEA’s Darren Grimes asked Dr Kristian Niemietz to join him, author of ‘Universal Healthcare without the NHS’.

Advancing freedom, human rights and economic development in Venezuela

Advancing freedom, human rights and economic development in Venezuela

November 2, 2019

Venezuela is currently facing the worst dictatorial regime in Latin America. Moreover, its economic collapse is the worst in the modern history of the western hemisphere. Jorge Jraissati is the President of the Venezuelan Alliance, an international platform for initiatives advancing freedom, human rights and economic development in Venezuela, Jorge will not only explain how Venezuelans plan to reconquer their democracy and rebuild their economy but also share some lessons from the Venezuelan experience applicable to other nations. Why is the Venezuelan economy ruined? How and why did Venezuela become socialist?

Jorge’s work has focused on raising international awareness about the importance of achieving a free and democratic Venezuela and he has been invited as a guest lecturer to more than twenty academic institutions such as Harvard, NYU and Cambridge. Academically, Jorge is an economist from the Wilkes Honors College, and a Visiting Fellow of the Abigail Adams Institute at Harvard.

This recording was taken during a talk by Jorge at the Institute of Economic Affairs in October. 

30 years on from the fall of the Berlin Wall

30 years on from the fall of the Berlin Wall

October 31, 2019

November marks the 30th anniversary of the fall of the Berlin Wall. Built to separate East and West Germany and to stop the flow of people from East to West, the wall came to symbolise the ideological divide between the communist Soviet bloc and the western democratic capitalism. Years on, East Germany still lags the West.

But after four decades of socialism, just how big was the economic gap between East and West? Whilst West Germany experienced aWirtschaftswunder and became one of the world’s economic powerhouses, in 1989, the East German economy lay in shambles. But is this perception correct, or is it sometimes overblown? How different really was the standards of living between East and West and what did it take to overcome the “legacy cost” of socialism after 1989?

Today, according to some surveys, many people in Central and Eastern Europe say they miss the “good old days” of socialism, or at least important aspects of it. Some seem to have “buyers’ remorse”, disappointed with the results of economic liberalisation. Does this show that capitalism is not that great, after all? If people still look back fondly on the days of state socialism, can we truly say we’ve won?

It’s true to say that socialist ideas has had somewhat of a resurgence in this country. Proponents – often young people – argue that this time around socialism will be different. When challenged, they say Marx never advocated any of the terror, coercion and loss of life incurred under Soviet rule, nor did Marx demand a wall be built through the German capital. Is it therefore inevitable that socialism leads to coercion and the stamping out of freedoms? Or is it as John McDonnell put it, like blaming all Catholics for the Inquisition?

Joining the IEA’s Digital Manager, Darren Grimes to discuss the legacy of the Berlin Wall's fall is the IEA’s Head of Political Economy, Dr Kristian Niemitz and author of ‘Socialism: The Failed Idea That Never Dies’.

Gig economy: empowerment or exploitation?

Gig economy: empowerment or exploitation?

October 24, 2019

The IEA's Mark Littlewood, having watched Ken Loach's latest film, would recommend it "if you want to see the gloomiest, bleakest, worst possible run of luck that a family in Newcastle could have, working in flexible gig jobs, this film shows it."

But Mark says he was left scratching his head thinking about the counterfactual: would these people have been better off in the pre-gig economy world? Mark concludes that he doesn't really think they would have been, but for their horrific run of bad luck. Mark asks whether Loach’s film might have been a little stronger if the characters involved hadn’t had all of the very worst things imaginable thrown at them.

So the IEA's Digital Manager, Darren Grimes, spoke to him about the film, the legitimate concerns raised in it, and questions Mark on if the gig economy offers genuine empowerment or very real exploitation.

Rebels without a cause?

Rebels without a cause?

October 11, 2019

When it comes to environmental problems in general and global warming in particular, the general consensus is that ‘something must be done’. Greta Thunberg and Extinction Rebellion have become sensations. But what is worrying about this phenomenon is that the more detached from critical reason their arguments become the more they are acclaimed. Greta, for example, began by arguing that those who put forward alternative views were liars and asserted that she had a special gift for being able to tell when people were lying. Her recent speech at the UN Climate Summit was simply a series of assertions.

Extinction Rebellion seems to be strongly linked to far-left political movements. The left often argues that climate change cannot be solved by markets. And aren’t hasty, to be honest about the trade-offs involved. The IEA's Digital Manager, Darren Grimes, asked the IEA’s Victoria Hewson, Head of Regulatory Affairs, and the IEA's Head of Political Economy, Dr Kristian Niemietz, to join him and discuss the trade-offs and challenges of adopting such a radical carbon-neutral prescription.