Saturday, February 28, 2009

Labour Don't Understand Markets: No 94

One of the predictable consequences of the banking crisis has been the spectacle of Labour MPs reverting to type in their slavering hostility to the market economy. Brown's Labour Party has largely kept its anti-capitalism beliefs hidden but now they've been set free (who needs Clause 4 now bruvvers?), the current state of the economy has brought those deep seated and hidden in the darkest places, anti-market views, bubbling to the surface.

Last week witnessed one small example of the Government caving into the anti-market brigade; a consultation from Andy Burnham’s department proposing a clamp down on people re-selling tickets.

It could have been worse. Thankfully, the Government ruled out a complete ban on the re-sale of tickets. But overall, the document exposes Labour’s failure to understand the basic principles of market economics, its default preference for regulation and its ‘we know what is best for you’ attitude.

Here is a typical example; Labour ministers want to introduce a “voluntary” (now where have we heard that before) ban on ticket touting for major events like the FA Cup and Grand National. All that will achieve is to make it impossible for legitimate fans to sell unwanted tickets. EBay and other ‘online’ market places argue that you can be sure it won’t stop street touts – instead, they’ll have the market all to themselves and will line their pockets.

What this sorry episode reveals is that Labour still doesn’t understand the basic rules of supply and demand. Pretty worrying when you consider that Andy Burnham’s last job was at the Treasury…but I suppose he knows that if his beloved Everton ever get to a final he will be given a ticket - well as long as they do it this season or perhaps next.


Jim Baxter said...

Agreed Iain. This was precisely the argument against your position the other week on legitimate, if usurious, money-lenders. Ban things that people need or want and are going to have, one way or the other, and the crooks get rich.

Chris Paul said...

If only! In a way.

Seriously though, as you admitted yourself, when people have criticised this government e.g. those bishops it has largely been a criticism of markets. And Labour people accept markets are a huge factor, but want to prevent them running riot.

Cameron agreed at Davos when he stated that the greed and freedom kicked off by Margaret thatcher had gone too far and needed to be reined in.

Ticket touting, or any move to dampen its excesses, is irrelevant.

And you don't actually seem to understand market economics yourself Iain. If you do you've been hiding your light under a bushel.

an ex-apprentice said...

No no no, Mr Dale, Andy "mascara" Burnham's total lack of any knowledge of Economics, or Finance, or even basic mathematics beyond an ability to add two and two and get the right answer 50% of the time, these were not a hindrance to his employment at HM Treasury, but a pre-requisite. For Heaven's sake you wouldn't want people there who actually had a clue, would you? You're obviously still struggling to fully grasp the way this government works.

PS Actually being patronised by a cretin like Mr Paul is a rare treat, you must be killing yourself laughing.

Calais said...

In life much is fundamentally unclear.

But here we have found an exception.

Chris Paul IS a prat.

Martin S said...

They seem unable to understand their own backers, the trade union movement. As in:-

"My God! We totally misunderstood the situation! We thought they be pleased we were going to sell off Royal Mail!"

an ex-apprentice said...

A further postscript on Mr Paul.

On his own sitehe suggests Dolly the Sheep might be in trouble for calling anther blogger "a sad twat".

Inappropriate choice of language presumably, and we all recall the storm in a teacup Dolly stirred up over Carol Thatcher and her use of the term "Golliwog", which by it's very nature, we were informed, was inherently racist, and must not be used.

And on Mr Paul's subsequent posting, about Fred the Shred's bonus, guess what he has scattered all over?

GOLLIWOGS!! Dozens of the little blighters.

force12 said...

What the hell is all this 'voluntary' crap Labour keep pushing. Do they think we are stupid?

'Voluntary' is merely the period between them making some cock eyed statement and when the interfering knobs legislate.

If they had the balls and conviction they would either leave well alone or propose legislation and get on with it.

Half-hearted measures, 'a nanny knows best' attitude coupled with a threat.

wv: painanus - exactly.

Glyn H said...

Of course Labour does not understand ‘markets’, they are socialists. Capitalism seeks to build and create by the use of human endeavour and socialism seeks to destroy and tear down. Socialisms parent, communism fails because each according to his need etc. does not comprehend human acquisitiveness to provide for ones family and future.

an ex-apprentice said...

Dear Mr H,

Can I borrow that book after you?

Johnny Norfolk said...

Labour at its best, fiddling around with unimportant issues and missing the big picture.
They are just so small minded and never learn or move on.
Its a case of too many people with not enough to do, so they come up with silly things like this. Do they realy believe they can stop tickets being resold to the highest bidder.

Alan Douglas said...

It is such a relief to know that this Labour government has finally found the solution to the current market turmoil : BANNING ticket touts.

We can all sleep peacefully in our graves now.

Alan Douglas

PS When we had two employees called Chris and Paul we spoonerised their names, which gave us the entirely appropriate Piss and Crawl. Just saying ....

Unsworth said...

Usual knee-jerk response to single interest pressure groups. Labour has no concept whatsoever of business.

Nor does it have the slightest idea of contract law.

Caveat Emptor. It's a simple as that.

If I want to pay vast amounts of money to go to see a Cliff Richard performance, that's up to me. Mind you, I'll be seeing the shrink on the NHS shortly thereafter.

Anonymous said...

They don't know how to run a country either, but they do know how to spin and cover up.

Anonymous said...

You are so desperate as to be laughable Mr Paul. 'greed and freedom kicked off by Thatcher'

Well we will leave aside the fact that you think freedom is a bad thing but 'greed'??

Dream on. Brown presides over a shambles but the labour play book has to revert every one of their disasters back to Thatcher. The BoE regulated the banks under Thatcher. Its Brown who lit the blue touchpaper on 'greed'- and was happy to rake in the taxes that resulted in the good times.

BTW - why this fuss over Sir Freds pension. It will be taxed at 40% and for all anyone knows he may do some good works with the rest. :-)

JMB said...

The trouble with ticket sales is that it is not someone selling off a few tickets because they could not attend an event. Ticket touts buy them in quantity, often from doubtful sources, then sell at a premium price because they are now in short supply.

How would you feel if you were only able to produce a fixed number of copies of your magazine, someone bought up all the copies and then sold at £100 each?

Paul Halsall said...


Iain, markets do, in fact, seem to have failed in their proposed purpose of allocating resources efficiently. The score this year is definitely

Adam Smith City 0 Karl Marx United 5

The Huntsman said...

They do not understand anything terribly much, most of them never having worked in or for a real commercial enterprise as opposed to a Think Tank, trade union, Academic institution or whatever.

In particular they do not understand (or of they do, do not wish to acknowledge) the effects of taxation.

I received this from a friend in the USA. It will amuse most save those who think Saint Barack walks on water....

"Letter from the Boss,

As the CEO of this business that employs 140 people, I have accepted the fact that Barack Obama is our new President, and that our taxes and government fees will now increase in a BIG way.

To compensate for this additional overhead, I figure that the clients will have to see an increase in our fees of about 8% but since we cannot raise those prices right now due to the dismal state of our economy, we will have to lay off several of our employees instead.

This unfortunate economic reality has really been eating at me for a while, as we believe we are family here and I didn't know how to choose who will have to go.

After giving it considerable thought, this is what I did: I strolled through our parking lot and found 11 Obama bumper stickers on our employees' cars and have decided these folks will be the first to be laid off. I can't think of a more fair way to approach this problem.

They wanted change; I gave it to them.

If you have a better idea, let me know.


The Boss"

Roger Thornhill said...

Labour is Socialist. Driven by

1. Envy of wealth and position, yet coveting it
2. Guilt and self-loathing of any achievements pre socialism, including inherited wealth/position for others, yet clutching onto their own in secret. Ladder kickers.
3. Mistrust of the individual who must be restrained, watched, controlled, ergo free exchange, i.e. markets.
4. Contempt for workers, who must be kept down, collectivised and owned by the Party. How dare they become Middle Class and aspirational except to serve the Party via Academia, Politics and other Fifth Columnist activity.

Trumpeter Lanfried said...

Don't you understand, Iain? If your ticket costs you £100 and mine costs £150 it's NOT FAIR!!!

Similarly, if you are tall, good-looking and charming, and I am small, grotty and sullen, it's NOT FAIR!!!

Socialism strives to remedy these injustices.

Phil C said...

To stray onto topic... I don't know why this should be a matter of public policy. It is a simple matter of a contract between the seller and buyer. If an event organiser wishes tickets to be non-transferable it should work out how to enforce that. Airline companies do it very simply by requiring you to give your passport number. Alternatively, the seller could just charge the market rate in the first place.

pxcentric said...

To continue to believe wholeheartedly in a system that has crashed so spectacularly you would need to be sensationally thick. Or a banker.

imran said...

Actually the problem is that the decisions are taken without knowing and realizing the ground level facts. The person who enforces the laws on the people and don't know what is the real condition of the effected people then you cannot expect a good and fair decision.

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