Sunday, January 28, 2007

The cost of free healthcare

British people are proud of their National Health Service, and so they should be.

Having free health care at the point of entry is something envied by people around the world. (Others would need to see it to believe it!)

When you consider that almost 50 million people in the US (equivalent to almost the entire British population) don't have the necessary health insurance required to pay for medical treatment, you realise how lucky people in the UK really are.

Not surprisingly however, the NHS is constantly underfunded.

Of course by definition, if you provide a service for free, the potential demand will be infinite!

Clearly the NHS will always be underfunded.

The question will always remain, by how much and where should any additional funding be coming from?

The answer goes to the very heart of the issue of how the political system currently works.


As a way to move the NHS forwards, the British government has recently imposed a series of 'targets' to help ensure an improving service is being provided to all patients.

The result has been enormous pressure being placed on staff and management to achieve these targets in order to 'stay in business'.

Overall, there have been improvements but even though targets are a good idea, what the NHS really needs now is more money.

The problems of more expensive technology, an ageing population and higher expectations are not going to be solved by setting targets alone. Someone has to pay for this and that someone is...

... You!

But at the moment no political party has the incentive to raise taxes to pay for improved public services. Why?

Because people don't want to pay higher taxes for improved public services.

Consider that statement for a moment...

People... don't want... to pay... higher taxes... for improved public services.

First, ask yourself if you agree with the premise of this argument? Second, are you one of those people?

I believe your answers to each of these questions are most likely to be 'yes' and 'probably not'.


The current state of British (and any other) politics is to essentially offer the choice of either higher or lower taxes.

This puts the voter in a conveniently awkward situation: they can vote for lower taxes, knowing they will be better off, at the expense of others.

What's worse, the decreasing voter turnout in British elections means that 40% of the British popualation (myself included) never get their voices heard.

Is it really fair for 30% of the population to be represented by people offering the false hope of a 'low tax' economy, when this leads to the situation of a increasingly underfunded NHS?

Once the 40% silent minority becomes 51%, it will signal a time for change in British politics. Maybe this could usher in a new generation of politics that stands for what people truly want.

Monday, January 08, 2007

Economists have learnt to subtract

There is one subject that economists love to talk about: growth.

Growth in home prices, growth in consumer spending, growth in the economy etc.

The basic question they are paid to answer is: "how are we doing compared to last year?"

But isn't looking at growth of data like GDP going to miss the damaging effects of global warming and the depletion of natural resources?

Not really. Unless there's likely to be a major change in the rate of depletion over the next 12 months (the economist's usual time horizon).


As highlighted in the movie An Inconvenient Truth, the monthly average carbon dioxide concentration has been steadily rising for over half a century.

Note the level of CO2 has been rising steadily, not at an increasing rate.

Going up

If we use this chart as a some kind of benchmark for the destruction of natural resources, we might conclude that until now, this destruction has occured at a constant rate.

So what is the incentive for economists to "factor in" the effects of depleting natural resources if their main concern is the growth rate of the global economy over the next 12 months?

Not very high.

Spot the difference

It's not that economists don't care about the depletion of natural resources. It's just not their job.

Central banks and governments can barely keep their own economies under control for a year, let alone limit the emission of CO2.

Of course, once the depletion of natural resouces starts to have a material effect on major cities (by drowning them), then economists will start to be concerned, but only if it cuts the growth rate of GDP!

Monday, January 01, 2007

Paris: a higher calorie Tokyo

Japanese are famous for taking something and improving on it. They did it with Paris.

And now I know why.

So many details of Paris are replicated in Tokyo, only with a (sometimes not so) slight improvement.

Below are a some examples:

-- Tokyo's underground is designed similarly to Paris, only much more modern; there is no English version for the French announcer, no information about where you can change at the next station;

-- Tokyo's 'Champs Elysees' is smaller, so made to look more exclusive;

-- Japanese people are as proud of their culture, only less arrogant!;

-- Japanese food is just as tasty, only much healthier!

To visit Paris you understand what inspired many of the details you find in Tokyo.

So if you ever decide to visit Tokyo, visit Paris first.