When he passed away in 2006, Milton Friedman was rightly mourned by all, but by none more so than libertarians.  To us, he was nothing short of a hero.  His Capitalism and Freedom has become a classic in defence of both economic and civil freedoms.  In Counter-Revolution in Monetary Theory, he wrote the oft-quoted principle behind monetary policy:

Inflation is always and everywhere a monetary phenomenon in the sense that it is and can be produced only by a more rapid increase in the quantity of money than in output.

These words, sadly, seem to have been lost on the vast majority of economics students today.

I’ve never claimed to have any high expectations of my fellow economics students.  In fact, I barely mask by outright contempt for the vast majority of them, who fill their otherwise empty heads with propaganda spouted by the leftist lecturers in the hope that it’s their passport to a job at an investment bank.  Today took the biscuit for sheer stupidity.

In a hall of over 200 second-year economics students, not a single person ventured the correct answer to the question, “In medium-run equilibrium, what is the inflation equal to?”  OK, I’m sure some people knew the answer but couldn’t be arsed to say it.  After all, I was in the class myself, but I far too interested in seeing long it would be, and how many ridiculous answers would be proffered, before we’d somebody would guess the right one (I have to get inspiration and amusement somehow!).

It was a long time.  One third-year student, with a job at a top investment bank waiting for him on graduation, thought that it was the same as equilibrium output.  Inflation and GDP are the same?  God, help us all…

Of course, Milton Friedman was right.  By the Fisher equation, inflation is the growth of the money supply above what the real economy can support.  If the money supply increases by 5%, but GDP increases by only 3%, inflation will be 2% [Very roughly.  I’m taking some liberties, but not nearly as many as the aforementioned halfwits].  This very simple relation is lost on a year of student economists.

Judging by the Daily Mail’s front page on Tuesday, it’s a relation lost on far more.  Apparently, we can cure all our woes by reducing interest rates.  By reducing the interest rate, the government increases the money supply, leading to spiralling inflation as outlined above.  That’s a good solution for the Daily Mail’s readership of home owners, who beg for government-induced inflation to pay off their huge mortgages for them, but it’s pretty shitty for the rest of us, and, in the long-run, the economy as a whole.

If one assumes that the state does have a role in controlling the currency (and there are sound economic arguments against it), the Bank of England’s first priority should be defend the value of the currency that it requires its citizens to hold as sacrosanct.  They’re bankers: their job is to keep money safe, and that means not destroying its value.

To do that requires a knowledge of monetary theory that is sadly lost on them, on the Daily Mail, and, judging by the current crop of UCL undergraduates, on the next generation of hedge-fund managers.

Just how stupid are the people that govern and micromanage our lives? If the actions of Antonio Nunes, the head of Portugal’s equivalent of the Food Standards Agency, are to be judged, the Portuguese must be suffering from a particular degree of ineptitude not seen in this country since John Prescott hung up his croquet whites.

In addition to telling Portuguese people what they can’t eat, Nunes’s job also includes telling them where they can’t smoke. And, since New Year’s, that’s included any bars, cafés, restaurants, and casinos. So, you’d think it would occur to Senhor Nunes not to light up in a casino in the early hours of 1st January to celebrate the new year. You’d think so, but you’d be oh so wrong.

Apparently, he didn’t realise casinos were covered by the ban, and has said, “We will have to look into what is in the law”. I don’t know whether it’s more fun to believe him or not. If he was aware, he’s a crook. If he wasn’t aware, he’s an imbecile. The laws we have rammed down our throats are only as good as the people responsible for upholding them, and whether in Bloomsbury or Braga, it seems as though there’s always going to be one constant: there’s rarely a good man amongst them.

Oh, good God, no. Those cretins have done it again:

Two computer discs holding the personal details of all families in the UK with a child under 16 have gone missing. The Child Benefit data on them includes name, address, date of birth, National Insurance number and, where relevant, bank details of 25m people.

In short, the government has given out comprehensive personal and financial details of almost half the population to… well, who knows? It would have to take a particularly stupid criminal to NOT commit fraud on a massive and hitherto unprecedented scale. This comes, of course, at a time when the government wants us to hand over even more information, and centralise it yet further into one handy fraudster-friendly item.

Goodness knows how they manage to keep up their incredible pace, but the Home Office and the Treasury seem to be in a heated battle to prove themselves to each be the most incompetent administrators in the world. I reckon this fuck-up puts the Treasury ahead by a nose, although there’s no doubting the Home Office’s ability to recover from this set-back.

Faux-Chancellor Alistair Darling’s statement to the Commons today would have been risible had it not been a statement of general government negligence and specific personal idiocy.

In [releasing the information] it is clear that the strict rules governing HMRC standing procedures were not followed. These procedures relate to the security and access to data as well as its transit to ensure that data is properly protected.

As this story (and the two other similar stories that he related) prove, these standing procedures don’t ensure anything. If they aren’t followed, they aren’t worth the paper they’re written on. This proves the government’s fundamental inability to be trusted with our information, because no regulation or safe-guard seems adequate to prevent them from giving our vital financial details away.

In terms of protecting confidential data, Her Majesty’s Revenue and Customs is operationally independent of Ministers. It is established by statute. It is run by its Chairman, Paul Gray, and a Board of Commissioners who are responsible for its operations, but answerable to Parliament through me.

So what if it’s operationally independent of Ministers? It’s institutionally dependent upon Ministers, who are responsible for executing the will of Parliament: and, in this case, screwing up big time. If HMRC is answerable to Parliament through Darling, Darling should be held responsible by Parliament.

That’s quite an elementary point of ministerial responsibility, as espoused by Gordon Brown yesterday:

In accordance with the Ministerial Code, Ministers are accountable for the decisions and actions of their Departments, including answers to parliamentary questions.

Huh. Do what the real Chancellor says, Darling. Fall on your sword now, lest one of the 25m people you’ve betrayed and endangered runs it through you. Back to what the condemned man said today:

If someone the innocent victim of fraud as a result of this incident, people can be assured they have protection under the Banking Code so they will not suffer any financial loss as a result.

Wait a minute. The Banking Code? The Banking Code states (under s. 12.12) that the banks accept liability for the loss of financial details of their customers’ details. So, in this case, the government has given away the details, exposed every bank and building society in the UK to yet more risk, and claims that it’s done nothing wrong, because the Banking Code protects consumers. Yes, it protects consumers, but it passes liability to banks, which have done nothing wrong.

In his devastatingly understated attack on the government, George Osborne raised this issue:

If fraud does occur—and of course it is good to hear that there is no evidence of that at present—where will the liability for any losses rest? The Chancellor said at the end of his statement that people would not lose out. Does that mean that the responsibility now rests with the Government, and, in effect, is the Chancellor now offering another general guarantee to depositors and people with bank accounts?

I would say the government should guarantee the deposits, and bear the brunt itself, but they’d only increase taxes to pay for it. It’s lose-lose-lose.

Let me reiterate:

1. There is no evidence this data has reached the wrong hands
2. There is no evidence of fraud or criminal activity
3. Banks and building societies are putting in place safeguards to protect people’s accounts
4. Banks and building societies will continue to monitor their accounts
5. No-one will suffer any loss if they are an innocent victim of fraud

No, let me reiterate:

1. We have no evidence that it has not reached the wrong hands. We know for certain that it’s not where it should be: under lock and key and not allowed to see the light of day.
2. Given the scale of the cock-up, with 25m victims, it’s almost impossible to detect fraud.
3. Why the heck should they do anything? You dropped them in it. You sort it out.
4. Again, why should they? Banks have enough to worry about right now than monitoring people’s accounts because the government screwed us over.
5. No-one will suffer any loss. Except banks and building societies and, therefore, their customers and members.

There is no excuse for this fiasco. They shouldn’t have had that information in the first place. They certainly shouldn’t have put it all in one database. And it goes without saying that they shouldn’t have sent it by courier to the wrong address without registering the transit. This is a disaster of monumental proportions, and the government pretends that it’s all OK.

The least that should happen is that Alistair Darling’s head should roll. There is no escaping the fact that the ministerial code requires him to be responsible for all activities in his department, and that includes all agencies over which his department presides, including HMRC.

A more salient lesson can be learned from the government’s attitude towards the debacle. Not only can HMRC not be trusted to handle our information with care, but their refusal to take the blame suggests that they believe this to be an occupational hazard. The fact is that we knew that already, which is exactly why we have consistently opposed the government’s ID card scheme.

This, coupled with recent outbreaks of rank stupidity and incompetence at the Home Office, only go to show that we can trust ministers as far as we can throw them. But, so long as we are throwing them, how about we throw them out? Now: before they give away the other 35m people’s financial details. I’m sure they’ll find a way to do it.

Even put within the context of his own error-strewn career, Conservative mayoral candidate Boris Johnson’s statement that he wants Hillary Clinton to be elected President, argued at length in the Telegraph, must go down as one of the most stupid things he could possibly say.  I assume it’s just one of his japes.  I hope it’s one of his curiously charming bounder’s comments that he made without regard to the actual words that he propagated.

But let’s say that he actually means it.  The crux of his argument is that Bill Clinton would make a better presidential spouse than the maritally-challenged Rudy Giuliani could possibly afford.  Wait for the incredulity to kick in.

He readily concedes - and rightly so:

She represents, on the face of it, everything I came into politics to oppose: not just a general desire to raise taxes and nationalise things, but an all-round purse-lipped political correctness.

He concedes - and rightly so - that the most important issues are:

Who should have their finger on the nuclear button? Who should be Commander-in-Chief of the American military, the hugest and most lethal killing machine in history?  The world may still face all kinds of economic upheavals, as the panic from the American subprime mortgage sector spreads around the world, like a kind of financial BSE. Whose brain can we rely on to protect us?

For all the importance of the President’s position as Commander-in-Chief of the America’s military might, for all the significance of his role as head of state of the world’s largest economy, and for all the powers enshrined in the constitution of the presidency, Boris makes his decision based on who sleeps in the presidential bed.  And, like Boris, I slap my forehead in astonishment.

Clinton is economically naive, spouting nonsense that is only believable because it’s placed in the wider context of a very left-of-centre Democratic nomination race.  She has lauded the New Deal, called the free market the “most radically disruptive force in Americna life”, and lobbied for heavy tariffs on (of all things) candlemakers.  Her support of more stringent campaign finance reform, a ban on flag-burning, and computer game censorship threatens freedom of speech.  She has offered each 18-year old $5,000 to pay for beer college.

This doesn’t sound like a programme that Boris should support.  When he spoke to UCL last October, he asked people to guess who his political hero is.  Margaret Thatcher?  Winston Churchill?  Robert Peel?  No, no, et mille fois non.  His answer was the mayor from Jaws, because, in Boris’ words “he did absolutely nothing: just as government should.”  Wonderful answer, illustrating a sound libertarian philosophy underpinning his characteristic umming and erring.  So what the hell is he doing endorsing her?

I hope that it’s just political posturing.  I really, really do.  Just as Ken Livingstone monopolises the left-wing vote, so Boris has his staunch supporters to the right.  The mayoral race therefore hinges on who can cannibalise the Liberal Democrats’ voter base: winning their second-choice votes.

Due to the timing of the mayoral race, Boris can easily change his tune after he (hopefully) wins, cite events in the primaries, and switch to Giuliani or whoever else.  If he does that, he can claim ‘no harm, no foul’, and move on to replacing bendy buses or whatever else he wants to do with the GLA’s £10.7bn budget.  If he doesn’t, and this is a sincere and honest statement in favour of Clinton’s candidacy, and therefore the principles that she espouses, it must go down as Boris’ most stupid gaffe to date.

On Wednesday, the Kremlin reinstituted price controls on a range of agricultural products in an attempt to control runaway inflation. Those words, in and of themselves, should strike fear into the hearts of the most indomitable men. Certainly, they do mine.

To counter what Vladimir Putin believes to be politically-unacceptable food prices, the government has slapped price controls on bread, cheese and milk, eggs, sugar, and vegetable oil. In this way, the government now controls, directly and immediately, the prices of all the major staple non-meat food products in Russia.

The government claims this to be a ‘voluntary’ agreement with companies, but this - as almost all claims of innocence by the Russian government - is a sham. One only has to look at the way that oil giants Yukos and Russneft were taken over by the Kremlin or pro-Kremlin lackeys to see what ‘voluntary’ means in Putin’s Russia.

There is no opacity to this ploy. The scheme is clearly and undeniably an attempt by Putin’s government to curry favour with the Russian electorate ahead of parliamentary elections in December by employing what are cynical and economically-misguided populist measures.

It doesn’t take a genius to work out that price controls can’t possibly work. Let’s say, for the sake of argument, that Putin’s premise is right: that prices are ‘too’ high. High prices come about because there is an excess of demand over supply. The institution of price controls only works when they reduce the price paid for by the market. This, of course, increases demands and further restricts supply.

Hence, price controls are self-defeating: driving up the natural market prices, reducing economic output, and creating an official rate-market rate price differential that is exploited by the black market. Price controls don’t work. They don’t respect the rights of the individual. They belong in the Soviet era of direct economic control. They have no place in a free society.

Ayn Rand’s novel We the Living, published 70 years ago, focuses the outcome of price controls, of rationing, and similarly motivated and similarly ill-reasoned policies. What followed, in fiction and in history, was a catastrophic nightmare for Russia then. Unless this government or the next is willing to step back from the edge and reverse this Soviet-esque policy, there can be no surprise when Russia once again finds itself facing catastrophe.

When most people hear that I study economics, they say, “Oh, a good, solid, libertarian subject”.  However, having been rejected by Cambridge after trying to teach Partha Dasgupta* about the Laffer curve, I don’t exactly hold my own subject in the highest of regards.

Today’s ‘Macroeconomic Theory and Policy’ tutorial kinda proved my point.

[The government] printing money has no negative effect on the economy: only good.  In the Western system, with the separation of politicians from central banks, this is not possible.  However, [PR] China, which is my country, we have this without negative effects.

Squeamish Westerners.  If only our government was more like the Chinese and risked over-inflating our economy just as theirs has done.  And if only our government was more hard-nosed and cared as little about deliberately keeping down the value of private assets as they did over there.  Darn bourgeois property rights getting in the way of sound economics…

A balanced budget policy cannot help an economy in a depression.  In a depression, the revenue goes down, but expenditure goes up, because unemployment benefits go up.  Thus, to try to balance the budget makes a bad situation even worse.  That’s stupid for the government to do so, because it relies on the government cutting spending or raising tax.

Yes, balanced budgets are incredibly stupid.  After all, we’ve already established that running a structural budget deficit is no problem, so long as the government is capable of printing its way out of trouble.  Just to correct my tutor here, if the economy is as described, the best way a government can correct its deficit is exactly to balance the budget: by scrapping the afore-mentioned unemployment benefit and getting people back to work and back paying taxes to fund the government’s assumed largesse.

After my scrape at Cambridge, I sometimes wonder if not knowing the first thing about economic public policy is considered a requisite ‘talent’ for teaching the subject in our universities.

*A lefty development economist who is (and this is not unrelated to the first factor) nailed-on for the Nobel Prize.

When you cross the Independent with a man with a name like ‘Le Grand’, you know it’s going to be an uncomfortable morning’s reading.  But when the rubbish said newspaper and said man spout are as rancid as that that corrupt the minds of the nation this morning, we could be excused for choking on our cornflakes (it’s lunch, but I was hungover at breakfast, so I’m having cornflakes now anyway).

The ‘Le Grand’ in question is Professor Julian, chair of Health England - whatever that is - and professor at LSE.  Speaking to the Royal Statistical Society on Monday night, he suggested that the way to end the health crisis was to introduce:

a smoking permit, which smokers would have to produce when buying cigarettes, an “exercise hour” to be provided by all large companies for their employees and a ban on salt in processed food.

Fair enough.  I mean, not fair - they’re stupid, stomach-churningly abysmal ideas that deserve to be lined up against the wall and shot one-by-one, and anyone can see right through that - but we’re used to this sort of shit from the government and its incompetent and intellectually illiterate advisers.

But what really gets me is that, apparently:

The idea, dubbed “libertarian paternalism”, reverses the traditional government approach that requires individuals to opt in to healthy schemes. Instead, they would have to opt out to make the unhealthy choice, by buying a smoking permit, choosing not to participate in the exercise hour or adding salt at the table.

What the f***?  “Libertarian paternalism”?  How the f*** is this libertarian?  Who the f*** dubs it ‘libertarian’?  This is about giving the government complete control over our lives.  It is about shifting the assumption of innocence to the assumption of guilt.  It is about making ourselves - the people - subservient to them - the state: those that we created to help us, not the other way around.  That is the opposite of libertarianism.  It is totalitarianism.  The ‘traditional government approach’ of allowing people a choice is not ‘traditional’.  It is essential.

Professor Le Grand may use his credentials to spit fascistic political bile at us, under the guise of a ’statistical’ analysis of the health problem, but so can we.  We, true libertarians, refuse to let you use that word.  We refuse to let you steal our clothing.  We refuse to let you drape the terminology of freedom and tolerance over your policy of slavery and intolerance.

Le Grand can piss off back to the LSE.  He can give us back our clothing, and he can piss off.  God help him if he runs into the Hayek Society any time soon.  If he does, he might just want to get some new clothes designed with those with second arseholes in mind.

Since becoming its leader, David Cameron has changed the Conservative Party beyond almost all recognition. Focusing on so-called ’social justice’, he has embarked on a wide-ranging reform programme. In a major policy announcement, Cameron today unveiled plans for the conscription of teenagers into what he calls the ‘National Citizen Service’. This bold action marks the completion of the Conservatives’ metamorphosis: not to acceptable and laudable electability, but to irredeemable statism, socialism, and suicide.

The New Tory plan is for all 16-year olds to take part in a six-week social engineering programme at the end of compulsory education, which the Tories rightly believe should end at 16, and not 18 as Labour intends to make it. During the programme, the participants would be forced to do rather pointless things like paint community centres and mow grass verges in a vain attempt to gain ‘inspiration’ and ‘respect for others’.

Cameron hasn’t done much to mask the collectivist ideology underpinning and undermining the new policy. Its name says it all really; ‘National Citizen Service’ combins connotations of the socialism of the National Health Serice with the nationalism of national service conscription, adulterated only by submission to the state for participants, and submission to second-class citizenship for those that deign to argue.

The policy has been heavily promoted by today’s Sun, which congratulates Cameron and itself for succumbing to the populism that the Sun has long espoused. Big government, nationalism, and slave labour in the guise of preserving law and order are the Sun’s favourite cocktail.

It will mix people from different backgrounds. North and south, black and white, rich and poor. They will be putting something back into the community.

And if they want to put something back into the community, they’ll do just that, by working through charities, the Scouts, religious groups, or other similar volunteer programmes. This method intrudes on people’s lives, forcing them to do the bidding of the state, regardless of circumstances, regardless of choice. Cameron’s message is, no matter where you live, no matter what your skin colour, no matter what your parents income, you can’t hide from Big Brother.

It will be away of learning respect for our country and each other, just like national service was.

National service was about forcing people to do what the people with guns said: a way to get cheap meat for the grinder of the expected apocalyptic war with the Soviet Union. If you think that’s a fair comparison, Mr Cameron, you dig your own grave.

Whether individuals are leaving school, moving on from their GCSEs to another qualification, or have dropped out of the system altogether, our national programme would take them out of their comfort zone, provide them with a chance to mix with others away from home.

Take people of ouf the comfort zone? So the New Tories think that it’s the role and responsibility of the state to make people’s lives uncomfortable? Misery may be the currency of oppression, but it certainly shouldn’t be the raison d’etre for it.

The Sun picks up where Dave leaves off.

Bookish swots will be shown there is more to life than just exams.

The dangerous intellectuals must learn the values of national solidarity and service to the greater ideal that they can’t learn in books. Well, except in books that were banned during the Second World War. In fact, let’s just burn all the books to prevent subversive decadent ideas like ‘liberty’, ‘education’, and ‘personal betterment’ spreading.

Teenagers will not be forced by law to take part in the NCS. … Instead, it will become so attractive it will become a natural part of growing up.

So the state will force people using ’soft’ power. It’s already been implied that employers will be forced to give preference to participants. They’d probably ban all non-participants going into higher education. They might increase the tax rate for those that refuse to bow to their demands. Or they might just make it compulsory further down the line when people have stopped caring. I wonder who it was that did that…

Der Stürmer’s own editorial urges us to ‘give it a chance’.

The Boy Scouts offered this sort of community training for more than half a century. The Duke of Edinburgh scheme and Outward Bound courses have been amazingly successful.

And, despite the Sun’s ignorant use of the past tense, they continue to be. For a century, the Scouts have done all that Dave wants to accomplish. And they’ve achieved it all without the heavy hand of the state forcing them.

… not all youngsters are tearaways looking for someone to mug. The vast majority are decent, considerate, and appalled by bad behaviour.

After a two-page spread of belligerent idiocy on the part of the world’s favourite newspaper, we get some sense. Not everyone is a tearaway. Most aren’t. So why does the government think it’s its responsibility to employ this one-size-fits-all national service? By forcing teenagers to work, they do nothing but alienate and belittle them: telling them that their libery is a luxury that the state won’t afford them, and that their future will be a future of compulsion, slavery, and misery. When the outlook’s that bleak, no wonder we have so much under-age drinking.

When Cameron told the world, “There is such a thing as society. It’s not just the same thing as the state”, I rejoiced. Not that I disagreed with Thatcher’s assessment to begin with, but it was refreshing to hear that a politician whose very value comes from his centrism was espousing a fundamentally libertarian argument.

This monstrosity of a policy undermines that. It is a concession by Cameron that individualism is dead, and that liberty has lost. It is a surrender of the big citizen to big government. It’s sad that this leaves no major party’s leadership willing to stand up for rights. Fortunately, it matters not one jot to the friends of freedom that Cameron has thrown in the towel. To us, it only proves that we can’t rely on others to make the case for so long as we have voices ourselves.