Comfort zone

The bomb at the Boston marathon has killed 3 and injured 177 [so far! some of the injuries are life threatening].

In Iraq this week there have been more than 30 bombings killing 50 people and injuring over 300, hardly making the back pages, I hate to think what is happening in Syria which appears to have fallen off the media radar completely.

I have no wish to denigrate the Boston bombing, but when the event is close to home it seems more shocking to the locals. We should not forget what is happening in the rest of the world.

We are all in it together

min wage rise 1.9%
inflation stands @ 2.8%


The minimum wage has been cut, not increased.

Vince Cable rightly noted that "cuts in real wages depress consumption" but the 12p increase in the minimum wage to £6.31 is a real-terms cut. After recent speculation that the minimum wage could be frozen or cut in cash terms, Vince Cable used his speech at The Institute of Directors to announce that the adult rate would increase by 1.9 per cent (12p) to £6.31 an hour, the under-21s rate by 5p to £5.03 and the under-18s rate by 4p to £3.72.

In justifying the increase, against those on the right who argue that the minimum wage prices workers out of employment, Cable cited the Keynesian insight that "cuts in real wages depress consumption and demand and thereby cause unemployment." Cable is right; low earners are forced to spend, rather than save, what little they receive (their "marginal propensity to consume" is greater) and stimulate growth as a result.

It's worth noting, then, that the minimum wage has just been cut in real-terms. CPI inflation was 2.8 per cent in February and RPI inflation was 3.2 per cent. The former is forecast by the Office for Budget Responsibility to average 2.8 per cent this year. Indeed, as the Resolution Foundation's James Plunkett recently noted, in real-terms, the minimum wage has already fallen back to its 2004 level.

GDP

For decades, the measure of a country or region’s economic vitality has been the output of GDP [gross domestic product]. Lately, however, economists and other informed observers have been questioning the accuracy of GDP, as it tends to be based on industrial measures, and misses the ever-expanding mass of digital activity.

GDP fails to capture the explosive amount of free information goods available over the Internet, including Wikipedia articles, Google maps, Linux open source software and YouTube videos. While suitable when economies were dominated by the production of physical goods, GDP does not adequately capture the growing share of services and the production of increasingly complex solutions that characterise advanced economies. Nor does it reflect important economic activity beyond production, such as income, consumption and living standards.

According to the official GDP statistics, the information sector (software, publishing, motion picture and sound recording, broadcasting, telecom, and information and data processing services) is about the same share of the economy as it was 25 years ago -  about 4%. Do we not have access to more information than ever before?

Percentages

In discussions on the internet, when discussing groups of people, quite often these people are divided into two groups: The haves and the have-nots, the good and the bad, the intelligent and the stupid, the hardcore and the casual, and so on. Statements about these two groups are usually made as if there was a clear distinction between them. In mathematical terms, if you plotted something like video game skill on the x-axis and the number of people having this skill on the y-axis, people talk of it as if the distribution was bi-modal; that is as if the curve would have two distinctive humps, one of good players and one of bad players.

Scientifically speaking that is utter nonsense. The Central Limit Theorem says that if you make for example this plot of video game skill of a large enough population, what you will get is a bell curve with a single hump in the middle. That is why this curve is called a "normal distribution". The nature of this curve is that 68% of people are within one standard deviation of the average.

For example 68% of people have an IQ between 85 and 115, and are thus of average intelligence. Of course people are notoriously bad at estimating their own IQ or other qualities, so that if you rely on self-assessment you end up with the observation that most people are above average, which is a mathematical impossibility.

Hypocrites

Greg Mulholland MP for Leeds North west has just slammed Anne Keatley-Clarke CEO of Children’s Heart Federation on Radio fours Today programme, of raising inflammatory statements when she raised parents concerns in the Leeds medical row. She pointed out that parents feel frightened because they had been threatened by local administrators at the trust, when raising issues previously.

Last week the Prime Minister David Cameron and the government said that people should not feel inhibited about raising concerns about the NHS. Jeremy Hunt Secretary of State for Health said “he will set up a new regulatory model for the NHS with a strong, independent Chief Inspector of hospitals” . He also said there would be no more NHS cover-ups as the NHS was told to adopt culture of zero harm and those found going against this principle will be put on a blacklist which will stop them working in the health service.

How is he going to progress this issue when members of the coalition accuse people who speak out against bad NHS practices of being inflammatory? Greg Mulholland needs to realise that he is crushing the debate rather than adding to it, by going down the road of censorship.

Bedroom Tax

There is a problem here with the maths. The scale is enormous.


56,000 households by the overall benefit cap
500,000 disabled people will lose out when DLA becomes PIP
660,000 households will be hit by the bedroom tax
1.36 million households by Local Housing Allowance cuts
2.4 million households by the Council Tax Benefit cut
9.6 million households by 2015/16 by benefits up-rating

Last year 1.7 million grants and crisis loans were made to people on the brink of destitution or rebuilding their lives following homelessness - these are to be abolished, cut and localised. Even Legal Aid for housing and benefit disputes is to be stopped, so people who believe they have been treated unfairly will have no power to challenge.

Homelessness is already rising as the economic downturn and previous cuts take their toll. Over the past two years rough sleeping has risen by 31 per cent, and the number of households accepted as homeless by local authorities has gone up by 26 per cent. Unemployment and underemployment remain stubbornly high.

How much is the government saving by doing this?

Oh, let us not forget that at the end of this week those making more than £150,000 a year will have their income tax cut!

What if?

The ratcheting up off rhetoric in Korea, North & South is worrying.

On the one hand, there is no real evidence that North Korea would be able to defeat the US in a one on one and China & Russia have both urged caution in media statements, showing quite clearly that at this time they do not want any involvement.

However, what if China and or Russia saw North Korea take on the US and inevitably the West and decided to step in to assist? There are several reasons why they should. Officially they are allies, they might consider the little guy is being picked on, or they might just fancy getting stuck into some aggression. Well we have a nightmare scenario unfolding.

I feel as though there is never enough shouting going on before a conflict starts, and I wish the UN and others not just in the West would become more verbally aggressive in situations like these so that they do not slip over into an irreconcilable state. Once the first shot is fired, it is too late, but before that happens negotiations can always have a chance of success. I am not suggesting that our PM goes rallying in with the first volley, but it does appear as though those that could speak out are sitting in meetings wondering who is going to make the first move.

Guys, it needs to be now, today, everyone with a bit of sanity needs to condemn North Koreas actions so that they slow down.