John Phelan is a Contributing Editor of The Commentator and fellow of The Cobden Centre. He blogs at TheBoyPhelan.
When I told a friend of mine three years ago that I was interested in Austrian economics she asked “Isn’t that just selling cuckoo clocks and lederhosen?” True, she wasn’t the brightest, but Austrian economics was fringe stuff. An influential school originating in Vienna in the late nineteenth and early twentieth century it was largely buried under the Keynesian avalanche of the 1930’s. That’s changing.
The Austrian school survived in America where émigré economists escaping the turmoil of 1930s Europe inspired a new generation. Perennial presidential candidate Ron Paul is an advocate of Austrian economics and the Ludwig von Mises Institute dominates the field.
But the economic crisis has seen the school gain new popularity in Britain. Radio 4 broadcast one show, "Yo Hayek!", which examined the ideas of one of the leading Austrian school economists, and a debate between Keynesians and "Hayekians" (the Austrians won). The Economist, bastion of conventional economics, recently carried a complimentary piece. The Institute of Economic Affairs has produced or reproduced a number of works in and on the Austrian school and Eamonn Butler has written an excellent short introduction for the Adam Smith Institute. In The Cobden Centre the UK now has its own Austrian-minded think tank and in May last year the first (to my knowledge) Austrian MP, Steve Baker, was elected.
John Phelan is a Conservative Party member and a final year economics student at Birkbeck College who blogs here.
A period of prolonged and extensive strikes could be bad news for a government battling to get runaway borrowing under control. So far the muted support for the coalition’s fiscal programme outweighs the noisy opposition. But, given that with high inflation and interest rate rises on the way we probably haven’t seen the end of the downturn yet, this could change.
But you can never underestimate the stupidity of trade unions.
That “Thatcher’s children” is still a term of abuse shows how Margaret Thatcher and the decade she dominated are still relevant. Conjured up by Eds Miliband and Izzard ‘Thatcher’ is shorthand for greed and destructive selfishness.
John Phelan is a Conservative Party member and a final year economics student at Birkbeck College.
You would have to be mad to run a football club the way Leeds United were run in the late 1990s and early 2000s.
Between 1995 and 2000 they spent £48 million more on players than they brought in. For a short time this brought success. The club secured Premiership finishes of 4th, 3rd and 4th between 1998 and 2001, earning the money-spinning bounty of Champions League football. By New Year's Day 2002 Leeds United were top of the League.
Five days later came the exogenous event. Leeds were knocked out of the Cup, their form slumped, and at the end of the season they were pipped to the fourth Champions League spot. Without the European money Leeds couldn’t pay the interest on their loans and began offloading players for fractions of what they had paid. By 2004 they were relegated, owing £100 million. In 2007 they were relegated again to the backwaters of the third division where they languished until last year.
You would have to be even madder to run an economy like that. Nevertheless, that is exactly what the last Labour government did, a government in which Ed Balls, grudgingly appointed as Shadow Chancellor, played such a prominent part.
On December 17th 1922 the Union flag was lowered over the Royal Barracks in Dublin, marking the end of British rule in southern Ireland. To a large extent (quite how large was the cause of the brutal civil war) this moment marked the achievement of the dream of Patrick Pearse who, on Easter Monday 1916, had announced, “We ordain that the elected Representatives of the Irish people alone have power to make laws binding on the people of Ireland”.
On November 22nd 2010, the 88-year experiment in Irish self-government came to an end. Worried that Ireland’s economic woes could infect them, its partners in the Euro, accompanied by representatives from the IMF, descended on Dublin to demand that the Fianna Fail government accept a loan. After days of brow beating and arm twisting that would have put Lloyd George and Churchill to shame, the Irish acquiesced.
The Irish experiment in self government ended in regret. In their anger, the Irish cursed everything that had happened to their economy in the previous twenty years, anything to do with the ‘Celtic Tiger’ was now reviled. This risked throwing a decent fiscal baby out with rancid monetary bath water. The famously low corporation tax of 12.5% introduced in the 1990s attracted business to Ireland; by 2001, more than 13% of all Foreign Direct Investment into the European Union went to Ireland. Between the late 1980s and Ireland’s entry into the Euro, this helped to add 500,000 jobs to the Irish economy’s existing 1.3 million. This led to a doubling of Irish GDP per capita. Then the Euro came along.
The experiment ended in excess. When they entered the Euro in 1999, the Irish inherited the low interest rates of the Euro area’s dominant economy, Germany. Able to borrow cheap, government and individuals alike went on a spending binge. Between 2000 and 2003 public spending rose by 48%. The boxwallahs from Brussels and Washington arrived at a Dublin Airport - whose manager is on a salary twice that of the German Chancellor.