John R

Thanks for resurrecting this almost religious thread after so long.

I remember having some interesting discussions with the OP, Jeremy Bosk, an amiable chap in my age range, and would like to think he is still alive and kicking. Are you receiving us, Jeremy?

What is rather topical today, and it's a thought that has often crossed my mind, is that so much of the wealth of the UK is a result of the nation's intellectual capital arising from the work of past geniuses. Newton, Arkwright, Watt. Faraday. Brunel, Rutherford Turing and many more besides..

Much of the toil that once necessarily was the common lot of humanity has now been handed over to machines. I do not need to employ washerwomen, cooks, musicians, jesters, ostlers, postillions, servants, to enjoy a life more comfortable and entertaining than any of the kings of the earth enjoyed 300 years ago. The benefits of technology are not being distributed fairly, although I note that Finland is starting to experiment with a citizen's basic universal subsistence allowance.

Perhaps that could be worthy of some further discussion?

Seattle's currently trialing a higher minimum wage – currently $13/hour, rising next year to $15

But, along with every corporation I know which has tried similar schemes, the net effect so far has done anything but level the playing field

Markets tend to be very good at setting their own prices ... and when we try and manipulate them, they try to rebalance ... In the case of Seattle, as minimum wages rose, so did unemployment

With a century and a half of failed socialist experiments, I suspect the effect of a universal income would be a simple devaluing of wealth through inflation ... The simplest rule of markets: when you start giving something away, it becomes worth less

I think it was Thomas Sowell who said something along the lines of: Every attempt to redistribute wealth has only led to a broader distribution of poverty

Exactly. The main determinant in UK house prices is not supply and demand (the demand is always there) but simply the amount that can be borrowed/lenders are willing to lend. The change to allow all a spouse's salary instead of, what was it, 25%?, has led to a one-time additional surge in house prices as more spouses (wives) went out to work, until now over 70% of owned households have both partners working. And so, the majority are living in the same housing stock as before, but paying twice as much to do so....

Residential property, and the UK's mania with it, is the main distortion of our sclerotic economy. The ONS figures for 18 Aug 2016 give the "net worth" of dwellings etc. at 5.5trillion of the entire UK net worth of 8.8 trillion - that is 62.5% on my calculator.

If only half that was devoted to R&D, manufacturing capability, infrastructure, education....


Edit: from the ONS summary: "By asset type, dwellings again were the most valuable type of non-financial asset. Adding in those belonging to other sectors, their total value came to £5.5 trillion at end-2015, up 7% on the previous year. This was over four times their value in 1995, when they came to £1.2 trillion; the increase was mainly due to increases in house prices rather than a change in the number of dwellings."