Sunday, 8 January 2017

BS Britain

From this afternoon we will see the latest strikes by hard-line unions on public transport. This time on the state-owned Tube network. The RMT is cross that its members can no longer hide behind counters in stations and have to actually interact with customers, and do roles other than selling tickets. That we no longer really need ticket-sellers seems to be ignored. In a normal industry, the workforce would re-shape, with roles lost where they are no longer appropriate and - most likely - boosted in other areas. For example, banks no longer need so many staff at branches, but need more at the end of phone lines to deal with problems when they arise. In my own industry, we have lost secretaries but gained admin and other support roles. Times change, but in BS Britain customers and - inevitably - the overall economy are held to ransom by those resisting the inevitable.

We are back in the 1970s, make no mistake. The Thatcher counter-revolution has largely been undone. We have Butskellists in charge at all levels. The "centre ground" is coveted by all except those on the very fringes (such as Jezza). Nobody should be upset, if at all possible: in this world a minor tweak here to this policy or a change to that tax rule there will solve everything. A morale-boosting speech is worth a thousand actions.

Politicians make promises they know cannot be delivered, whether a "fare freeze" and "no strikes" in London, or getting the Mexican taxpayer to pay for a wall to protect the US border. Any upfront challenge is batted away, but as soon as the election is won the promise is diluted so much that even a homeopath would balk.

You can see why voters get frustrated. You can see why people lose faith in The System. It is basically impossible for everyone to be pleased at the same time. That is why we have elections and democracy in the first place. When one faction loses support, it is time for the other faction to take its turn in power. Except the system is broken: each faction in the UK tries to garner the support of the other faction's natural supporters. But in the end it does not work, and we just end up with a bigger state, more taxes, more economic friction and more frustration.

I should in no way feel "hard done by". I earn a good salary (somewhere above the 90th percentile, if the official numbers are to be believed), my mortgage is cheap, I have money left over to save at the end of the month; and yet I do not feel prosperous. I have - on paper - a healthy net position, but that money does not buy me very much. I save a lot of my income into a pension and even if I continue to do so until I am 70+ it will give me very little in retirement income. My flat has nearly doubled in value since I bought it yet, if I move, most of my cash savings will be wiped out in transaction costs. Despite my good salary and savings ethic, I cannot even really buy anywhere significantly nicer to live if I stay in London. I know people on much higher incomes who have the same problem. I spend a small fortune on public transport, which frequently lets me down. 

If people in my situation (highly educated, highly skilled, well paid, healthy) are frustrated, what hope is there for everyone else?

I had high hopes for Theresa May, but tomorrow she will apparently launch the Sharing Society. The state will intervene more, on behalf of those just above struggling. Will it also intervene less where that would be appropriate? We are not told. In the absence of evidence to the contrary, we should presume that it will mean more taxes, less efficiency and so ultimately slower growth.

It is time for firm action on the BS. Let's call things out where they clearly aren't working properly: whether it is overstaffed public transport systems or a completely dysfunctional housing market. Let's accept that sorting this stuff out means that for any particular action about half the electorate will be disappointed or angry - whether it is NIMBYs, those in public-sector unions or Soft-Brexiters. Let's stop trying to appeal to everyone, and crack on with clearing up this malaise. And quickly, before too many of the highly-educated, highly-skilled, well-paid and healthy decide to look for better-functioning, lower-taxed, sunnier climes.


Matt said...

Sadly sorting out the housing market requires removing those on zombie tracker mortgages who only just manage on almost 0% interest rates.

That'd be a whole lot of angry people who 'deserve' the executive slave box (and low end Beamer/Merc) they can't afford.

Demetrius said...

According to my very large Keynesian flow chart we need to increase savings, raise rates of interest, curtail consumption based on debt and invest only in projects which will yield real rates of return. We have a problem.

Electro-Kevin said...

It's not really the '70s. The railway unions are actually fragmented along company lines. Of the 25 TOCs only (only ?) one or two are in dispute and there is no chance of flying picketing, closed shops nor intimidating members into voting for strike.

The standard was reset for legal strike support for ballot to reach 50% recently and the Southern dispute still achieved this. The reason ?

The staff have good cause.

Drivers are being asked to check 12 car commuter trains of 1000 plus passengers using a system which allows only a few seconds viewing time once power is taken. The RAIB has already said that interlock systems cannot be relied upon to prevent trap-and-drag incidents. There is also the issue of fog and camera misting.

Where DOO was originally intended - inner city areas, short trains, local help available - Aslef have agreed to it. (I can go into disabled access, faults and failures and out of course train movements and the need for staff but will not bore you here.)

DOO was not designed for what is being proposed on Southern. It's also worth noting that Southern is not a TOC but a management organisation being told what to do by the DfT. There is suspicion that this is a test bed for conflict with the unions on real TOCs.

I expect there is a certain amount of union protectionism over jobs but why shouldn't there be if a business is expanding ? The Tories purport to stand for well paid jobs - but where they exist they want to get rid of them.

I understand the argument "under qualified/overpaid" but not really. £30k in London/SE is not wealthy by a long shot and the passengers will not see the difference. It is more a case that the average person is *underpaid* these days.

"Make the unions pay compensation."

This will work but is a big change in the country's nature and a step towards totalitarianism.

And finally "This is unionists trying to dislodge the government." Yes. But they have to get through a largely conservative (small c) workforce to do it and for that they need a legitimate case (H&S normally.) TFL seems to be an odd case and I have taken their unionists to task for their over-use of industrial action.

Case by case, I think, Blue. The Daily Mail loves to conflate all these things and yet Mick Whelan (the real Aslef Leader, not Tosh McDonald) is in full on denial that there is any concerted effort here in this month's Aslef Journal. I believe him. I've never been on strike in 26 years.

NB The Telegraph yesterday had an article "DOO fit for service" then left it two paragraphs down to explain "... once mirrors and cameras had been sorted out." Jeeesus Cheerist !.

Blue Eyes said...

EK this is a tube strike. About "understaffing" of ticket halls.

Blue Eyes said...

The previous tube strike was about "understaffing" on the Night Tube, which was solved with a bung to drivers.

That BS leads me to presume that all rail union strike action is BS. You see, the unions are undermining their own credibility.

The Southern strike is not about DOO. Southern are not introducing DOO.

Electro-Kevin said...

Like I said. TfL RMT is a law unto itself. The London effect where everone goes for the money - only to realise that it doesn't buy much when you get it.

Yes. I agree wholeheartedly. The RMT in London has been unreasonable. But the rest is not BS. That's our bad and not yours. (The RMT represents many trades which is why I don't belong to it.)

Blue Eyes said...

Well it all means we are ALL worse off. Including probably the people who support this crap.

Anonymous said...

Demetrius said: "curtail consumption based on debt"

That means greatly reducing the number of students at universities, or finding some way to finance colleges and universities without student loans.

Don Cox

Anonymous said...

@ Let's call things out where they clearly aren't working properly

Thats the Daily Mail's game. How uncivilised, dear.

Anonymous said...

Things won't get sorted out because ideology means the wrong questions get asked.

Take public transport. It wasn't very good nationalised, and it's not very good privatised, yet its the private/public argument that constantly gets raised and not "why is it crap?"

A bit of sanity would suggest that the economically viable services should be run privately, no subsidy, and the socially useful, yet uneconomic, should be run publically. But the UK is ever against finding the appropriate tool for the job, and demands either a hammer or a screwdriver regardless of the fact the problems consist of both nails and screws.

Suff said...

Greetings from Abbaland Blue come on out the waters lovely. I loved the homeopath comment.
Yes the taxes are eye watering but you can see where they are spent and the quality of life is great. The only thing I miss from the U.K. Is the banter.
I call BS on the Pension system. With the glass ceiling removed and placed firmly on the head of any straight white male ( officially now known as haters ), shouldn't our sling back wearing co workers be forced to make a greater contribution. They do after all live longer so the premiums should be set to match. Also as a smoker and heavy drinker my health insurance is higher, yet I have to pay the same pension when im not expected to live as long.
I agree we have to call out the BS but at the same time we have to live in the system we have, otherwise you just end up howling at the moon. With the above in mind. I took a look at my own laughing curve and realized it wasn't high enough. I have my own company and pay myself a comfortable salary just below the mental tax rate. This leaves the vast majority of the money in the company. With no incentive to pay more tax or put it in a pension, I took four months off work (still paid myself) and build an extension on my house. I probably generated more personal equity than I would have generated working for years. Depending how the contracts fall I will be doing the same this year only I will use the time to travel. Life's for living, get on with it

Nick Drew said...

What follows is not wholly fair on your post, BE - and frustration is frustration - but I can't help thinking that seeing the matter through a property lens does not give a total perspective. You may never speak to me again, but ...

in my first army posting to Germany (1970s) we were the only British regiment in the city, so the Officers Mess was well in with the local gentry and we'd get lots of invitations to visit them (professional people - lawyers, doctors, Mittlestander businessmen etc). Their homes were (a) almost invariably flats; and (b) by British standards, eyebrow-raisingly small (and, of course, always as neat as a new pin, stuffed full of the latest electricals). All these chaps seemed happy and proud.

Everything is relative to expectations: it could be that, twenty years from now, lamenting not having a Big House will sound a bit like someone in the 1950s lamenting that they will never have servants like they were accustomed to before the war and always expected to have

now it's all fine & well for me, having made some dosh in the 1990s etc etc. And of course I'm a big believer in (i) property and (ii) aspiration. And I have kids of my own in their 30's, neither of whom own property ...

so I'm an old dinosaur, who started out when there was free university education and career planning and final salary pensions etc etc; but the point is made

(and BTW, no final salary pension for me - been gigging too long, and the rest was in Equitable Life ...)

Blue Eyes said...

Suff I did consider accepting a job in Norway a couple of years ago. They actually have some time for professionals. Also they *encourage* house-building. Their taxes are sky-high, but their public services have a reputation of brutal efficiency. If our public services were brutally efficient I would not gripe so much about how much I hand over. But they are not. And I am not sure how much actual service I will ever actually receive. Much of public spending is on pension benefits which I am unlikely to ever get myself.

Nick, fair point. I don't see why we can't build more flats and houses though. There is no shortage of land even in the SE. I don't just want a nicer home for myself (although I do want that) I am saying that the system seems to have been desgined to stop anyone from getting somewhere nice to live unless they have an enormous salary or huge wealth.

Do you think apart from housing everything is pretty good? I don't.

Steven_L said...

I had high hopes for Theresa May...

You're kidding, she's the most prudish PM in living memory. If you think people are frustrated now, just wait 'til she blocks their online porn.

Steven_L said...

My flat has nearly doubled in value since I bought it

Wasn't it $2 to the £ when you bought, one euro fifty, 240 yen? If my old man sold his place in 2007 he would have got $800k. Now he would get $500k tops. You're smarter that this BE, you surely don't buy into this nonsense that UK house prices are higher than the 2007 peak do you?

Blue Eyes said...

How many bushels of wheat could I get for it?

Electro-Kevin said...
This comment has been removed by the author.
Electro-Kevin said...

Blue - You could always rent your flat out and try further afield. I understand though. It really isn't fair on you and I've always felt that (what with all the hard work and study.) Alas London comes at a premium and perhaps small should be considered bijous in that vicinity.

Sorry to have meandered onto union stuff and I should have either avoided or attached a thoughtful preamble to it. But seeing as I did...

(avert gaze if you don't want to get into it !)

More on the tube dispute below. It isn't just about ticket offices but the staffs' secondary role in manning stations for contingencies.

If you go back in the archives there is more on the Night Tube issue too. (Tube drivers have always been contracted to work over night as far as I know.)

Electro-Kevin said...

"The previous tube strike was about "understaffing" on the Night Tube, which was solved with a bung to drivers."

Solved by the recruitment of part-time TOps according to AS.

theProle said...

"If people in my situation (highly educated, highly skilled, well paid, healthy) are frustrated, what hope is there for everyone else?"

It's only really the SE that's got a problem. I live in a nice market town in a rural bit of the Midlands. I earn slightly less than the national average wage, and frankly feel pretty comfortable. I'm probably less well educated than you (started work after A levels, although my education to that point was very good). My mortgage on a not terribly nice 3 bed house (bought 2012) equals about a weeks pay a month. I spend a little less than I earn most months without any real conscious restraint on my spending.
My job is interesting and fulfilling, with very light touch management most of the time, which is why I stay, despite almost certainly being able to earn more elsewhere. My commute is a 25min drive on empty roads, costs £30 a week in fuel.
I'd probably give my position in life an 8 out of 10.

I dread to think what I would need to earn in the South East for a similarly relaxed lifestyle.

Blue Eyes said...

EK, I brought up the unions ;)

Whatever the purported issue at hand is, the main rail unions have appeared to get to a point where no change can be made without a strike. That might be unfair but that is how it looks from a customers' perspective.

As for housing, yes small is beautiful. Maybe I should stop saving and start spending. Yes, put myself in a position where I can never do anything because I have no cash. Hawaii here I come!

The Prole: sounds good. All I would have to do us give up proximity to family, friends and my few other interests. If I am going to do that I may as well at least get some better weather and less political BS.

Raedwald said...

If it's any consolation, BE, all capital assets including housing are vastly overvalued and no-one can convince me that the bubble won't burst, so the problem won't last for ever.

Electro-Kevin said...

BE - "the main rail unions have appeared to get to a point where no change can be made without a strike."

That really is just a perception. There are 25 TOCs and only one of them is on strike. 99.99% of crews are not on strike and never have been. (I haven't in 26 years)

Had I not been in reciept of the Aslef Journal I would not have known what Mick Whelan had to say about Southern. Only what other people say Mick Whelan says about Southern. It is still hard to get any detail of what the dispute is about.

As a representative myself there perennial local safety matters that were repeatedly discussed in meetings without recourse to industrial action and this is true for reps up and down the land. Some agenda items became a standing joke - the state of the walking route in *** Yard to the shore supply. (Ten years we argued until the coffee went cold with that !!!) The lighting in ******* Yard. The disagreement about the industry using a Fatigue Index designed for airport baggage handlers to calculate train driver rotas... loads of it.

The usual method is to accept certain issues and use them as bargaining chips or as a demonstration of reasonableness so that when you have something that is unacceptable (such as blinds not being allowed on DMUs because of leasing problems) you have built trust with management - and a raft of pending issues which amount to a debt !

So I hope that I have explained enough that this union stuff is not BS or needless confrontation. Aslef Shrugged (and his commenters) provide a highly interesting read - not least for its decent prose and cogency - and explains some of the underlying.

Night Tube was not solved with a bung to drivers. They recruited part-timers.

The ticket office dispute isn't about the closer of ticket offices but the unmanned stations which will result in a heaving capital city on an already DOO service (accepted long ago by the unions.)

Finally. Protection of jobs which this is about too. (Automation/DOO is accepted on the railway but it has to be good if it is to displace staff.)

I avoid automated tills like the plague. Especially in London. I want the minnions (including the migrants) to have real jobs. I also shop locally when more canny people are doing it online. I know it doesn't make sense in the modern world because it costs me more but I imagine what the alternative would do to my local high street.

Electro-Kevin said...
This comment has been removed by the author.
Electro-Kevin said...

PS, You're a London boy born and bred. Leaving will always exact a cost on you. It may be worth paying but it will be a cost nonetheless.

Personally I regret moving and have never settled since.

(That's why I suggested perhaps renting your flat out rather than selling it.)

Nick Drew said...

Do you think apart from housing everything is pretty good? I don't

we do debate this around here periodically, don't we. IIRC you are sometimes to be found on the optimistic side of this, BE

Blue Eyes said...

Well maybe struggling to get from my damp flat to work today has taken the shine off. Even the 70s German professionals had public transport!

Steven_L said...

How many bushels of wheat could I get for it?

Bushels of wheat tend to get more affordable as a result of technological progress and growth. Likewise, building houses gets more affordable. It costs £100k or less to build a 3 bed detached house.

You know fine well it's the land that grows in value. The fact of the matter is that a typical building plot in the UK is worth less now, measured using a mixed basket of major currencies as is sensible to do, than it was in 2007.

Likewise UK GDP and UK average earnings, when measured like this, look a lot different. Just look at the forecourts - oil is $55 and petrol is £1.19/L. In 2007 I was paying 99p/L at $100/barrel.

Thinking in £ is a mugs game.

Blue Eyes said...

SL you half get my point and I half agree. My point is that the USD value of my home now vs 2007 is irrelevant to me as all my earning and costs are in GBP.

However I agree that the only thing that really matters is how my home's value has performed compared with the market, and on this count I am down compared to the sort of place I would like to live, and significantly up compared to not having bought it in the first place.

Steven_L said...

I don't know how the maths pans out for you (and probably as a Londoner on a high LTV mortgage you are 'up' against renting and safe savings in government bonds). But I reckon most people in the UK are still down on not selling 10 years ago, revolving into to safe assets and renting.

If you factor in the opportunity to revolves from bonds into equities, even just tracking the S&P500, anyone who both held UK property going into the GFC and who cares about their net worth (and I accept most people aren't actually all that bothered/greedy) made a massive mistake.

US bonds and equities have been among the best mainstream assets to own for the last 10 years, and UK property has been one of the worst.

mike fowle said...

EK, I commuted for long spells between the 1960s and the 1980s. My journey was frequently disrupted by industrial action of one sort or another, and the staff were with few exceptions surly and unhelpful. That is my "perception" based on experience.

Anonymous said...

BE - "I had high hopes for Theresa May"

At that point the whole thing fell to the ground .. ;-)

But I can understand, I had high hopes for Tony Blair in 1997.

It's not at all like the 1970s though. Back then a single earner on a low wage could still buy a house in most of the UK. University didn't mean crippling debt. Pensions were final salary. We still made things like computers and aircraft. And Prime Ministers worried about the balance of payments, not about child mental health (on which, if we're all so much less tightly buttoned than we were, how come there seems to be more mental illness?).

Electro-Kevin said...

Mike Fowle: 1980 was... 37 years ago !

I got my long service badge recently (25 years) I joined in 1991 ! Never on strike in my life.

Privatisation took place in 1994. said...