Sunday, October 14, 2007


What do the two halves of the Control Party - its Scottish and Northern wing, and its Southern and Posh wing, both - think should have no price in our society? Recap: a price is a measure of something's value in terms of the alternatives you forgo by choosing it. Prices are a constraint; they force us to allocate resources between competing priorities. Straightforward enough, so far.

In public policy, if you wish to constrain the growth of something or the use of a resource, there are essentially two ways to do it - you can ration it, or you can tax it. The first corresponds to an artificial restriction of supply; the second to an artificial constraint on demand. Either way, what is being achieved is either equivalent to raising the price, or analogous to raising the price.

Successive governments have been quite keen on creating quasi-markets or budgeting systems for various things; GPs are meant to "buy in services" from NHS trusts, the government departments are meant to pay a capital levy to the Treasury to force them to economise capital. But what is interesting are the limits of this principle.

It seems that it is acceptable for some things to be treated as if they were cost-free; specifically incarceration, roads, and unearned income. The government frequently tries to influence the judiciary to send more people to jail, and has changed the law to make it harder to leave jail. Therefore the jails are so full it is actually impossible for some people to be released. Perhaps the Home Office should be forced to buy the extra prison places it wants from the Ministry of Justice every time it wishes to rattle the keys? Or alternatively, perhaps each court should have an annual budget for punishment, thus being forced to prioritise its use of scarce cells?

Similarly, it seems the idea of building more roads is being floated again. Simultaneously, we are told that traffic on the railways is to be demand-managed; that is to say its price is to rise in order to keep the demand from exceeding supply. But roads are treated as if they were more like air.

And finally, both clunking fist and Dave from PR are in agreement that gains captured from the housing bubble or inherited are to be taxed at a substantially lower rate than income from either wages or even company profits. It is now the policy of both wings of the Control Party that both labour and capital should subsidise the land bubble, inherited wealth, and dubious hedge-fund manoeuvrings.

Priceless indeed. You thought the elimination of the 10% lower rate of income tax was bad enough; hell, it was even framed as an encouragement to the poor to work harder. It's not just a policy skewed to the rich, though; it's a policy skewed to the idle rich.

As a brief example of one of the many reasons this is awful, consider the Vertu range of mobile phones; beware the Flash-ridden website. These are heavily designed, or rather designered; their design is in fact far from beautiful or functional, but is intended to convey the impression of good or at least expensive design. And they are tricked out in various inappropriately posh materials (diamonds, for example).

However, the actual electronics within the case are unimpressive. The company is a Nokia division, but very little of their engineering effort has gone into them. For example, only two of them have an e-mail client, only one has a UMTS radio, and none have WLAN support, GPS, a serious programming environment, or any of the other features Nokia packs into its most advanced devices. Nokia's N-series devices are marketed at those whose taste in displays of wealth lies towards the Modernist end of the spectrum, and delight in technology for its own sake. Its E-series devices are marketed at people, and more importantly organisations, who actually find mobile e-mail, GPS, integration with enterprise telephone systems, VPN service, and the like useful.

Vertu's role is to get rid of old models for silly prices to people who are impressed by ornamentation, and who are unlikely to require IPSec; rich people who don't work and have no taste, in other words. Can you see what I'm driving at?

Oh, and I agree with every damn word of this and this.

1 comment:

cabalamat said...

The Virtu phones remind me of nothing more than US cars of the 1950s: all chrome and crap suspensions.

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