Friday, 16 January 2015

HS2 as groundhog day

This is an easy post to write because its mostly already been written, so actually lets tag on some new bits at the end. Anyhoo, according to the BBC MPs are questioning the value for money of HS2. Except, there's  no need to waste time and money doing so because we already know the government's own, "independent" value for money analysis is a made up pile of bull crap.

Go here to a Dec 2013 post wherein "Professor Dan Graham of Imperial College, London, said "I do not think the statistical work is reliable" while Professor Henry Overman of the London School of Economics described KPMG's approach as "essentially made up". And lets be clear, an academic calling something “essentially made up” is more than casting doubt, he is saying it's garbage to an extent where this isn't actually a debate."

To which the consultants - who guessed the size of HS2's financial benefits  - said; their methodology "does not have a firm statistical foundation”.

And that's it really. There is no debate - the analysis isn't "reliable", is "essentially made up" and lacks "a firm statistical foundation". Well there is one debate, but that;'s why hasn't HS2 been shitcanned already, like seriously? Like what we are seeing are Tories willing to piss away money on vanity infrastructure projects like a Tony Blair on speed at the same time as they're changing welfare rules to the point where people wrongly denied benefits are committing suicide.

There's something nastily Republican/GOP about how the Tories stink these days.

Sunday, 4 January 2015

In praise of Russell Brand. Seriously *.

Successive Labour and Tory governments have had increasing institutional investment in the British residential property market as a policy goal. The Montague review, for instance, was targeted at identifying both barriers to institutional investment and ways of overcoming them; and with institutional investors’ allocations to residential property rising from £7.6 billion in 2012 to £12.7 billion in 2014, it’s an area where government can claim to have had some success.

Whoopee, except I’m not sure how much awareness there is of the fact property investors typically - and fundamentally - differ from other institutional investors. A pension fund, for instance, owns lots of little bits of companies, enough to give it the right to contribute a few votes at an AGM and get patronised by the CEO and CFO once in a while, but not enough to really influence whatever it is a company does. By contrast, property investors usually own whatever it is they invest in outright (give or take a bank loan), which is why property investors actively “sweat” their assets, be it churning the - poorer performing - pubs in a pubco portfolio or increasing the number of folks selling things off carts down the aisle of your local shopping centre.

This brings us to Russell Brand who helped draw attention to what increased institutional investment in residential property can, does and will mean. After an Ummurikan investment firm bought the New Era Estate in London, it promptly set about trying to evict people in the name of redevelopment i.e. get in folks who could pay higher rents/buy the properties; nice. So sure, sure, the London housing market is different, but the principle applies across Britain - institutional investors will actively try to “sweat” their assets, that being potentially a euphemism for clearing out entire estates en masse.

Now there is the moral case against evicting people because you can, but that will never fly beyond the pages of the Grauniad, so lets make an economic one; evicting people like this imposes obvious externalities (costs) on everyone else i.e. us  - the employer that finds his key staff have resigned to move elsewhere, the employees who can no longer afford the commute so resign and sign on, the schools contending with an influx of new pupils, the transport companies that suddenly lose out on wodges of fares, etc., etc.,  bause the thing to bear in mind is why successive governments have tried to encourage more institutional investment; s social housing has become increasingly about social need, this has left a widening stratum of working poor too “rich” to qualify for housing association help and too poor to buy a house – these are the precarious people government is hoping institutional investors will cater for.

And my god the interviewer in the clip above was a monumental walloper for trying so hard to turn such a fundamental issue into a  story about the size of Russell Brand’s bank account.


* fucking hell. This is how shite politics has got in Britain today.