AN OUTSIDE VIEW

The Chief Executive of Shelter has written an article in today's Guardian about the housing crisis and the need to build more. It is not a crisis. The situation has been much the same since the end of World War 2. The problem is chronic. Houses are affordable. What is not affordable is the land the houses stand on. Land value taxation is an essential element in any solution to this. But where are all these new houses going to go? And if they were all built, how would their occupants get to work? And where would their children go to school? And what about all the other services they will need? The problem cannot be considered in isolation. A major factor in all this is regional imbalance. 85% of the UK population live within an area bounded by Leeds, Dover, Bournemouth, Bristol, Birmingham and Liverpool - about one third of the total land area. And most of that within a 100 mile circle centred on Oxford. This is due to decades of economic mismanagement. A major factor is our tax sys...

Swedish house prices in millions of SEK. Stockholm: 3,4 mkr (+15%) Skåne: 2,1 mkr (+11%) Halland: 2,0 mkr (+8%) Uppsala: 1,9 mkr (+9%) Västra Götaland: 1,8 mkr (+12%) Gotland: 1,6 mkr (+15%) Södermanland: 1,6 mkr (+9%) Östergötland: 1,6 mkr (+8%) Västmanland: 1,5 mkr (+7%) Blekinge: 1,2 mkr (+5%) Jönköping: 1,1 mkr (+3%) Kronoberg: 1,1 mkr (+8%) Örebro: 1,1 mkr (+6%) Västerbotten: 1,1 mkr (+12%) Jämtland: 1,0 mkr (+16%) Kalmar: 1,0 mkr (+9%) Värmland: 0,9 mkr (+9%) Gävleborg: 0,9 mkr (+8%) Dalarna: 0,9 mkr (+6%) Västernorrland: 0,8 mkr (+10%) Norrbotten: 0,8 mkr (+8%) Storstadsområdena Stor-Stockholm: 3,4 mkr (+15%) Stor-Malmö: 2,7 mkr (+10%) Stor-Göteborg: 2,6 mkr (+11%) Source: Källa och defenitioner: Statisktiska Centralbyråns småhusbarometer. Siffran i parantes anger prisförändringen jämfört med samma period 2006. Figures in brackets are increase compared with 2006. One million kronor is about £75,000, which is roughly equal to the value of the building. This is very interesting. T...

For the first time for years, I will be away from Brighton during the LibDem conference. I like the LibDems. They are nice people, generous, worthy and well-intentioned. They are not greedy, or envious or bitter or over- ambitious. They are polite, they will listen and they are generally open to new ideas. They are exactly the kind of people who ought to be running the country. And with the largest number of LibDems in parliament since the end of World War 2, they might have been expected to make a big impact on the British political stage. Sadly they do not. Why could this be? It seems to me that the Liberal Party lost its soul when it joined with the Social Democratic Party. Liberalism was once a coherent political philosophy. It did not stand at a half-way point between the Left and the Right but in a triangular relationship to them. This was a good place to be. If you believe both Left and Right to be wrong, then a judicious mixture of the two is unlikely to be right. But that is w...

There is lots of comment on the Northern Rock affair again today in the Sunday papers. Now there are calls for regulation. The next great crash is unstoppable. It will probably come in a couple of years' time. It is too late to do anything about it. The time to have acted was some time between the previous one of 1992 and 2005. The best analysis of the process is by Fred Harrison, who successfully predicted the crash of 1992. Harrison has now demonstrated that the boom/bust cycle, which recurs about every 18 years, is due to the interaction of the land and financial markets. Harrison's prediction is for 2010. Read Harrison on the next great crash The Northern Rock affair shows the process in actions. Their imprudent loans have been helping to stoke up house prices. But, and this seems to go unremarked by the politicians and pundits, it is not house prices that have been stoked up. What has been stoked up is the cost of land. And the stupid lenders imagine that land is solid we...

I noticed an article on the subject in the Guardian. It is worrying that anyone should even read anything into this event, let alone write an article about it. It was basic good manners. Have the Guardian's commentators nothing better to think about? What makes matters worse that the space could have been used for a biting analysis of Brown's economic policies since 1997. The Northern Rock problem is the harbinger of the great collapse which can be expected around the year 2009 and which is now unstoppable. Had Blair acted any time between 1997 and around 2004, the coming disaster could have been avoided. FOR AN ANALYSIS OF THE BOOM/SLUMP CYCLE

9 minutes to 3 Originally uploaded by ne15 . I had long invested in Northern Rock term bonds as they give a good rate of interest. But a year or so ago, when I saw their lending offers - I began to have my doubts and did not reinvest. They were offering silly loans, annual incomes multiplied by an absurd figure. All of which helped to stoke up house prices. Only it is not house prices that have been stoked up. Builders' wages and the cost of building materials have hardly risen. What has been stoked up is the cost of land. And the stupid lenders imagine that land is solid wealth and perfect collateral for loans. But when I was taught economics it was drummed into me that LAND IS NOT WEALTH. Every bank manager should have that slogan facing his or her desk. This is an area where governments should intervene. Lenders should not be allowed to advance loans using land as collateral.

Zoe Williams, writing in today's Guardian (Wednesday September 12, 2007), criticises the government over its policy to give all pregnant women £120 towards fresh fruit and vegetables. Her criticism is that the money will go to everyone and not just the needy. It is a pity that she did not dig deeper into this issue. She is right about questioning handouts for fruit and vegetables and baby bonds, etc, but wrong on the matter of means testing. Much of the whole relationship between the state and the individual is means-tested. This is true of the entire tax and benefits system and it is part of the problem. Not only does it give no incentive for people to move out of the underclass - it helps to keep them in it. In this context these fringe benefits are marginal to the issue of what to do about Britain's growing wealth gap and the growing hereditary underclass. If one takes a long view, it can be seen that the underclass first arose in England (Scotland has a different history) i...

I see this hardy perennial has come up again. Nobody seems to mention how public sector labour costs are distorted by our tax system. One might have expected someone - commentators, union representatives, journalists, politicians, economists etc - to have referred to this. But it does not happen. In the face of this kind of blindness, problems are insoluble and all we get is strife. Real wages are the goods and services that can actually be purchased in exchange for labour. Owing to the way the tax system is constructed, it costs an employer over £1.80 in order to leave the employee with £1 of actual purchasing power. This is how we have achieved the seemingly impossible - the low wage, high labour cost economy. In the public sector or course, where the labour costs are paid by the taxpayer, the money is given with one hand and taken away with the other. This is called churning. It is an expensive administrative exercise which produces nothing and achieves nothing, apart from deceiving...

Ängelholm pilgrimage 028 Originally uploaded by [florestan] . This illustrates the core of Catholic superstition. The priest is holding up what is known as the Blessed Sacrament. It is just a piece of bread that a Catholic priest has pronounced the words of consecration over. According to Catholic doctrine, it has become the Body of Christ, that is, God. My nice rational friend told me that, chemically, it is unchanged. I suggested that it cannot be proved that it is still in the same quantum state. I have not received a response. Chemical states, quantum states or whatever are, in truth irrelevant. I am happy to accept the Catholic doctrine on this matter. There are some things one knows, like relationships, for example, without having to have them explained by rational argument. This is one of them.

The TUC conference has prompted a lot of comment, for example an article by Polly Toynbee on the growing wealth gap. There is talk of a commission, and giving the unions more power. A commission will not solve anything. And the unions can only exert power in economic circumstances that are favourable to them. In harsh conditions they are irrelevant. And if work is plentiful they are superfluous. What we are seeing is a re-run of what happened in the early part of the nineteenth century. During this period, an enormous increase in productivity following the Industrial Revolution had, paradoxically, produced a small class of wealthy people and a huge class of the wretchedly poor. The extra wealth had not been distributed. Marx tried to analyse what had happened and his view remains generally accepted even though it will not stand up to close examination. But an American economist Henry George, who also looked at the problem, came up with an altogether more convincing explanation. This wa...

SWEDISH DOGS are a special breed. They have no rear-end orifice. I have not seen any deposits since I arrived and can only conclude that is the explanation. SWEDISH TEETH are funny too. It could be because of the Swedish style of dentistry. Anyway, the Swedes can't suck them as in ssssssssssssst, can't do that, it'll cost you. If they can help you, they normally will and won't make a big thing out of it. Often they will help more than they need or one would reasonably expect.

" Nearly 85% of Britons want a smaller gap between rich and poor, with just 34% believing Britain became fairer under Tony Blair, according to a poll of 3,000 voters conducted by YouGov for the Fabian Society. It found only 2% believed much progress had been made in narrowing the gap between rich and poor in the past 10 years. The poll is one of the best indicators of the public mood as Gordon Brown makes his strategic choices for the spending review. The findings show the public believes it is possible to reduce the gap between poor and rich significantly without damaging the economy, but there is support only for targeted tax increases. Nearly 80% thought taxes could be raised on big company profits and 67% supported a rise in the top rate to 50% for those earning over £100,000 a year. " The widening gap between rich and poor in Britain is obviously something that a lot of people are worried about, but the statistics about wanting higher taxes on big company profits and peo...

Vadstena_1710.jpg Originally uploaded by seadipper . On the way back to the coach. People from different places had different flags to follow so they would not get lost. This is the recently invented flag of Västgötaland. The papal colours with the blue of Sweden. There were a lot of regional flags being waved, which made for a colourful occasion despite the grey sky.

Vadstena_1700.jpg Originally uploaded by seadipper . In the afternoon there was a Blessed Sacrament procession from the modern Brigittine nuns' church to the original fourteenth century pilgrimage church where St Brigit's relics are kept. The heavens opened and people got their feet wet. There was Benediction in the church. The picture was taken afterwards. I think it is good that the protestant Church of Sweden allows its buildings to be used for Catholic services. It is as if Glastonbury Abbey had not been destroyed and was being used by the Church of England and the C of E let the same thing happen there.

Vadstena_1698.jpg Originally uploaded by seadipper . Bishop Arborelius saying Mass.

Vadstena_1695.jpg Originally uploaded by seadipper . The Brigittines again.

Vadstena_1691.jpg Originally uploaded by seadipper . Some of the congregation, with the Brigittines in the foreground.

Vadstena_1689.jpg Originally uploaded by seadipper . People came from all over Sweden to attend Mass in the courtyard of the castle at Vadestena. This was when people where just starting to arrive - eventually the space was full up.

Red Originally uploaded by iwouldstay . I have been pondering this further. What actually is the aim and purpose of a long distance high speed rail link? And how might such a link be tied into Britain's sub-standard infrastructure? And what might be/needs to be done to upgrade that? There are obvious gaps in electrification. London to Bristol and Cardiff/Oxford/Banbury/Birmingham, Bristol to Birmingham, Leeds to Manchester come to mind and there are probably others. And capacity improvements can be achieved by grade separated junctions, signalling schemes, platform lengthening, upgrading of alternative routes. As well as improved design of rolling stock; replacement of slam door stock actually resulted in a loss in seating due to poor design. Then the Channel Tunnel High Speed line needs to be brought further into the country, as much for freight as passenger services. Since this runs on the east side of England, much of which is flat and relatively undeveloped, it might be possib...

There has been a email discussion on this for the past couple of weeks. A lot of US supporters of land value taxation advocate Capital Value (CV) lists as the basis of assessment. The argument against is that the tax erodes its own base and is arithmetical nonsense once the rates get high. I quoted a figure of 5% as the most that could be raised without knocking CVs down to the point they would be meaningless as a revenue base. And a response came back like this... New Hampshire has ad valorem rates of 4%, and no problems. Kiaochow, which probably recovered the highest fraction of land rent in history, used an ad valorem rate of 6%. You appear not to understand the effect of an increase in the ad valorem rate on capital value. Yes. It knocks it down. Unless other taxes have come off at the same time or there are other factors pushing up the price. If you are taxing 6% of assessed capital value, then the capital values must be around 45% of what they would be in the absence of the tax. ...

There is a massive rental market in both residential and commercial sectors. This makes it easy to calculate land rental values by the residual method. eg a 100 sq metre flat in Hove lets for £12000 a year. This has been the case for the past five years at least. Council tax is another £1000. ie Gross value is £13000. Maintenance is £2000. Administration et is £2000 a year. So AV is £9000. Building value is £90000 at a building cost of £90 per square metre. To convert this into an annual figure, say 5% (OK, it might be between 4% and 6%) of that is £4500 ie within the range £3600 and £5400. The balance is the annual value of the land AV (land), £4500 (land rental value range is £5400 to £3600). At the £4500 figure, if the initial rate of land rent charge is 22%, they will be paying the same and will not complain. In fact, they are used to increases of up to £150 a year and would probably only grumble a bit if the initial rate was 25%, which would come to £1250. However, because there ...

The problem surfaced in a land valuation study carried out in West Oxfordshire. The aim was to see what would happen if the same revenue was raised from the same area using land values as the basis of the assessment. In effect, it was a notional pilot study. Residential property is subject to the Council Tax, a relatively small charge locally determined and based on banded selling prices. Commercial property is subject to the National Non Domestic Rate (NNDR or UBR) which is a relatively larger charge based on rental values. The same property will be subject to much higher charges if it goes from residential to commercial use, which distorts the property market and patterns of land use in the UK. This differential has the effect of depressing the price of property, actually the price of land, in commercial use. The valuation was on capital values. The valuer applied a correction to strip out the hope values. But no correction was applied to adjust for the differential taxes currently b...

Over the past few years the idea seems to have grown up amongst supporters of land value taxation that it is impossible to determine the rental value of land. It has apparently come from the USA. They claim that it is irrelevant how the valuation list is done, but that it is too difficult or politically problematic to measure rental values. To assess the rent of land from capital values by the residual method on a developed site, in principle this is the process. 1. deduct the value of the structures on the site. 2. deduct hope value. 3 decapitalise this value using an agreed figure of probably around 5%. 4 add in all property taxes actually being paid at the time of valuation. To assess from rental values of a developed site the process is. 1 deduct the decapitalised value of the structures. 2 add in all property taxes actually being paid at the time of valuation. Site values as determined by a variety of methods are then "smoothed". The first valuation is obviously the most...

There was a long discussion thread this week on the Guardian's web pages, following the test run of the Eurostar train over the newly finished route into London. First. The entire conventional rail network in the UK is sub standard. Britain has a narrow gauge railway running on standard gauge track, with sharp curvature. This precludes double deck trains entirely and results in all other trains being cramped and uncomfortable. Compare Eurostar with the TGV to see the difference. Therefore to get proper value out of new high speed lines, they cannot use existing routes into city centres, though there may be some alternatives such as the line into London Marylebone. Second. What counts is door to door journey times. Within the UK, people are concentrated into an area bounded roughly by Leeds, Manchester, Bournemouth and Dover - over 85% live and work there. But within that area they are quite dispersed - it is a pattern of development that cannot be served efficiently by public tra...

milf eurostar train paris Originally uploaded by candidphoto . The Eurostar was due to make its record-breaking test run over the new route today. Whether this investment was actually good value for money is a moot point. There may be a case for a high speed rail link to the north but most journeys are local and urban, not between cities hundreds of miles apart. It would probably be better to spend the money on local transport instead, for example on urban tram systems. And also on electrification and upgrading of existing routes. Due largely to decades of economic mismanagement, around 85% of the population of Britain live in about one-third of the land area, roughly speaking within a radius of about 150 miles from Coventry. This means that inter-city journeys are typically a lot shorter than they are on mainland Europe, and so higher speeds do not give such useful reductions in journey times. Bearing in mind that costs rise exponentially with speed, and that there is an optimum spee...

Plaxton Premiere Volvo B10M Originally uploaded by inglian . Yesterday there was a report about a coach overturning due to dangerous driving - the driver was arrested on suspicion of being drunk. Earlier in the year, another coach overturned. And ten years on, there is still discussion about how Princess Diana was killed. Was it dangerous driving or was there a conspiracy? What does not seem to get much of a mention is the contribution of engineering design towards safety or the lack of it. Princess Diana's car could not have ended up running into a concrete column in Britain or other countries where potential hazards are protected by ARMCO barrier. This is the corrugated steel strip used in the centre reservation of motorways and can be seen in the left of the picture. And now take a look at the coach, which is a standard contemporary design with a high floor. Single deck buses and coaches from the 1940s and earlier had low floors with the engine at the front. But then came the ...

This was a surprise. There isn't a Catholic church there, so the priest comes from Helsingborg and says mass on Sundays at 2.00 pm in the Rönne Church (Baptist). What did we get? A very well attended service, with a full church. The mass was in Swedish and the Ordinary was sung in Latin, Gregorian Chant, Mass VIII. And as usual in Sweden, the congregation was from a diverse range of places. All the same, everyone joined in the singing. They are hoping to get a church of their own. There is a lesson in this.

trauermantel Originally uploaded by HaPe_Gera . Camberwell Beauty - I saw one when I was staying on Åland. Other creatures I have seen for the first time were a tawny owl. a grass snake and an adder.