Mises Institute of Scotland - Austrian Economics & the Liberty of Man


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Farewell to Thrift

by admin
182 years ago, in January 1835, the Airdrie Savings bank opened for business. It was, and remains, a community-run venture allowing personal savings to be safely stored and wisely invested. This week it was announced that the bank will be wound down and closed in the Spring. We mark its passing as a signal of a larger catastrophe; we are in a world where thrift – frugality and wise economic management – is a thing of the past.

As a small boy my earliest memories of banking are of going into the huge (to me) main banking hall of the Airdrie Savings Bank with my mother and a large glass jar, full of thrupenny-bits. This was banking Airdrie style, with real savings and a bit of grandeur to the experience. The double-height neo-classical banking hall, the atmosphere of hushed concentration from the staff, the massive portraits on the wall, one of a gallant chap in red British-Army dress uniform and wearing a fine feathered military hat, made quite an impression on me. Then, of course, there were no bandit screens between the staff and the customers. One felt like a welcomed investor. I could have been in London or New York, investing millions, and not have been treated any better than I was as a small boy with a jar of oddly shaped brass coins.

Such was banking in the late 1960’s. Even then the Airdrie Savings bank (ASB) was an outlier. The only independent savings bank left in the United Kingdom; the only one to refuse to be swallowed up into larger organisations. But it worked well, in those days, where the pound was tied to the dollar and the dollar was tied to gold and gold was real money that could neither be printed nor counterfeited.

Looking back with adult eyes, the sequence of causes and effects that was to eventually destroy this organisation was already in place. The news in the evenings was full of helicopters and gunfire, for the war in Vietnam was in full flood. Wars, we must remember, are expensive things and are paid for not only in blood but also by devaluing currencies and silently robbing populations. Bombs were needed and, so, also, were dollars. The dollars were duly printed and the gold drained away from the US hoard. First a trickle and then a deluge. In 1971, President Richard Nixon went on TV and told the American people and the world about the evil speculators and the need to protect the financial security of America. He said he was temporarily suspending convertibility of the dollar into gold. What he really said was the US was bust and was defaulting on its debt. The last tether to reality was severed in world financial markets, the last restraint gone. For the Airdrie Savings Bank, the die was cast but it would be a generation before events worked themselves out.

Unrestrained fiat currency manipulation saw inflation in the 1970s, speculation in the 1980s and a transition to the “PhD standard” – control by wise economic sages such as Alan Greenspan – in the 1990’s. We were told this was an end to boom and bust. We were told the central bankers now had the wisdom, the power and the data to fine tune the world financial system for peak performance and peak communal wellbeing. Banking had become sexy, it had become politics, or perhaps it had become faith. It was all a long way from Airdrie and from thrift. The effects were visible first in the real economy, where the good productive jobs ebbed away from the town of Airdrie and the independent spirit that had built and maintained the bank was slowly eroded. But the bank continued almost as before. Yet now there were bandit screens between the tellers and the public.

And now we come to 2008. The 11th September (interesting date) to be precise. The whole banking system stood on the brink, hours from a complete collapse. There would be riots, blood in the streets, martial law, starvation and panic – unless the government, via its ability to extract wealth by taxation, bailed out the banks. And bail they did.

For a while “banker” was term of abuse as people realised how much was paid, and how much ordinary people were suffering. Some, with an eye for cause and effect traced the problem from the PhD standard in monetary regulation to the wild greed of the big banks and the “Greenspan Put”. Some looked for an alternative model. Some even looked to Airdrie. In 2010 new investment came in to encourage expansion. This was directly and explicitly a reaction to the 2008 banking crisis.

A group of Scotland’s leading businessmen have come together to support the expansion of Airdrie Savings Bank outside of its Lanarkshire homeland.

The list includes Brian Souter, Ewan Brown, Alastair Salvesen, Sir Tom Farmer, Ann Gloag, Sir Angus Grossart, Sir David Murray and DC Thomson & Co Ltd. They plan to create at least one, and possibly two new branches over the next 18 months, [this] comes as the bank celebrates its 175th birthday.

In addition, Airdrie Savings Bank is looking at developing an account-opening network in Scottish towns and cities where there is a proven demand for its services. The bank has also been investing in internet banking as a platform to support expansion.

Bob Boyle, president of Airdrie Savings Bank said: “The trustees are delighted that so many prominent Scottish business figures have come forward to back our ambitions to expand. Several are supporting us through a combination of deposits and borrowings.

“Airdrie Savings Bank, as you would expect, is approaching expansion with caution. We will dip our toe in the water by opening one branch at a time to prove the sustainability of growth before considering more ambitious plans.”

Brian Souter said “Airdrie Savings Bank represents what Scottish banks once stood for – security of funds, a focus on savings and outstanding personal service.

“We aim to bring this traditional blend to the people of Scotland by supporting the bank’s development as we believe the mutual principle is fundamental to the integrity of the bank.

“We are doing this because so many Scots are dismayed at what has happened within the banking sector.”

But from the optimism of 2010, to the closure of 2017 what has happened? It was not a case of over expansion. The bank has no problem with inadequate reserves (theirs are over three times greater than required by the government regulator). Rather it is a story of slow strangulation by the very regulations that politicians claim will prevent risky behaviour by banks and will encourage the wise stewardship of resources that had been the modus operandi of the ASB since 1835. In other words the cure was the killer.

Chairman Jeremy Brettell said: “Whilst we are financially strong, a comprehensive strategic review of all future options concluded that we will not have – as a very small bank – the resources in the years ahead to provide the products and services our customers need in this increasingly digital world.

“The decision to implement a phased end of business activities is totally consistent with the over-riding responsibility of our Board of Trustees to protect the best interests of our customers, both now and in the future.”

Chief executive Rod Ashley said: “In taking this difficult decision, the trustees have taken full account of the bank’s proud history.

“However, we are in absolutely no doubt that acting now from a position of financial strength is both prudent and responsible, and in the best future interests of our customers.”

Mr Ashley cited a “shrinking customer base” and “declining footfall” as contributing to the closure.

He said: “Sad as the course of action outlined today is – in terms of our history and heritage – we are in absolutely no doubt it is in the best future interests of our customers.”

The hidden effects of regulation which prevent competition with established interests, stop innovation dead in its tracks and disproportionately burden smaller firms are well known in (Austrian) economic circles, but politicians still succeed in selling this to the public as a restraint upon large corporations. It is in truth a restraint upon the free market and the little-guy and a subsidy to the large corporations.

Consider the specific case of the Government’s banking deposit guarantee. This work of fiction claims the government, in the event of a bank collapse, will reimburse savers for the first £85,000 (Euro 100,000) lost in any collapse. For the masses, who believe the plain written meaning of the words, this means that more conservative careful organisations are no safer than the risky ones – for the government guarantees that all banks, and all depositors shall be equal. The natural free market advantage which would normally accrue to risk averse and wisely run organisations is wiped out to all but those few investors who do not believe that tiny reserves in government hands can guarantee a massive financial industry.

Furthermore, for the ASB, it is not merely regulation that is to blame, for the income of the bank was also hit. That income came from three main sources: deposits held in other (larger) banks, loans to the public secured against property and the purchase of UK government debt.

All have been hit by the unprecedented zero Interest rate policy (ZIRP).

This has maintained an unrelenting squeeze on the bank, not sufficient to create losses for the overheads are low by virtue of ASB’s uber-thrifty corporate structure:

No shareholders

The Bank has no shareholders. It does not need to pay dividends and any surpluses are available for reinvestment for the benefit of customers. The Bank is governed by a Board made up of Trustees and Executive Managers. The Trustees give of their time without remuneration and have no financial interest in the Bank’s progress. This form of corporate governance is another of the Bank’s unique qualities.(ASB Website)

But rather the reduction in interest rates has hit the ASBs income and forced it to likewise lower the interest it pays to savers to almost nothing. Without an incentive to save or at any rate to save via an institution such as a bank, why would people cross the threshold? Keeping the money in cash, in a Paypal account, or anywhere else where it is safe but yields no interest, is just as good as a bank in the world of ZIRP. Worse, saving at all becomes less attractive. Rather debt, being subsidised, grows and families find themselves ever-more in its unforgiving grip.

In summary, all incentives to thrift, to the careful management of scarce resources, are obliterated in the modern world of fiat money, PhD economists and zero percent interest rates. They are replaced by a burdensome regulatory environment, and by a financial system where money is free for bankers and almost free for the public. As a result, thrift dies, replaced by theft from savers and subsidy to speculators. Like the service I once received as a small boy in the Airdrie Savings Bank, I shall miss it.

First published UK Column, 22nd Jan 2017


Nationhood versus Nationalism

by admin

Western Confusion Highlighted in Scottish National Socialism

I was drawn to this topic, a sensitive one to be sure in contemporary Scotland, by a social media post sharply critical of a letter published in the die-hard SNP supporting paper “The National”. The social media post highlighted the xenophobic and anti-English sentiments in this letter as symptomatic of a narrow prejudice at the heart of Scottish nationalism, and by extension most or all nationalist movements. The offending letter is reproduced in full below:

So now we have a part-time deputy leader. Angus is out of the country four days a week, he is an MP, he is the leader of London SNP MPs and now he is deputy leader with an important role to play in our independence campaign. This part-time attitude to our independence must stop. Angus also had an important role to play in indyref1 and we lost. We have the same old people in the same old positions making the same old mistakes.

I am also very concerned about the inclusive policy adopted by the party. The most important vote any Scot can have is the vote for their country’s independence. This precious vote of ours has been given away to any Tom, Dick or Harry who happens to be in the country at the time.

The English girl passing her time in Scotland till her visa to Australia came through voted No in indyref1 because she didn’t want Scotland to be independent and two weeks later she emigrated to Australia, an independent country. Since the EU referendum I have been angry at the number of EU people who voted against independence. When they were given the honour of a vote in Scotland’s bid for independence they voted against me and my grandchildren having the same citizens rights as they take for granted in their own countries.

We now have retired English people buying homes in the Borders. We have a housing boom in the Highlands as ex-pats buy cheap homes and in my area of Fife we have building firms building homes for English in-comers.

I am a Scot born in Scotland and I have lived here for 75 years and I am reduced to hoping and praying that all these fly-by-nights, who are in the country two minutes, will give me the right to my country’s independence. Scotland’s vital independence has been reduced to a cheap lottery where anyone can claim a ticket and take part. They don’t have to buy a ticket because that would mean putting a value on our independence vote. Our precious independent vote has been given away to the lowest bidder.

So in thrall has my party become to their inclusive mantra that I don’t believe they have any idea of the offence they have given.

Those who are born and living in Scotland and those who have lived here for 20 years, is the value I would put on the right to take part in our referendum, and that is 50 years less than my generation has given to Scotland.

Can we wonder why my generation does not trust their pensions and assets accrued over a lifetime to a government that can give away our right to decide our country’s future so easily and so cheaply?

G Ross

I found to my surprise that I was more sympathetic to the difficulty of the author than I might have expected. That is not to say that I share any anti-English sentiment. I do not and the reasons for this are outlined in my talk at Winchester titled “Who are the British?” in which I touched on our common history and future, shared identity and heritage.

Rather I sympathise with the larger truth the writer was encountering. That is the conflict between state endowed citizenship and full membership of a nation. The state employs crude rules to assess who does and who does not qualify for a magic ticket called citizenship. This ticket entitles the holder to a claim on his neighbour’s wealth and income via the welfare state and to a say in his neighbour’s future via democracy, which let us always recall is simply majority (or mob) rule. It even allows the holder via that same democracy to take away or add to the rights of his neighbour, add or remove legal protections enjoyed by his neighbour. In the case highlighted in the letter it allows the holder to help decide the future nature of government, even in a case where the individual has no intention of being subjected to that government.

I read another account of this same problem recently. It considered the hypothetical case of a Turk immigrating to Holland and becoming a citizen. He or she will immediately wield the full powers of citizenship, no more or less than a son of an ancient Dutch family, whose ancestors won the land back from the North Sea and fought and bled to keep it from being the dominion of a Spanish king. Furthermore that clog-wearing Dutchman may be fully part of the culture of the nation, embrace its reformed Christianity, cherish its democratic ideals, respect its limits on power and value its pluralism. The incomer may embrace none of these attributes, may be entirely alien to the culture, may even be hostile to it and wish to undermine it and change it out of all recognition. The state cares not for such subtleties, for how can it? It cannot consider the fullness of a nation any more than it can acknowledge the richness of a family. Rather it imposes crude measures for even cruder reasons.

And what might those reasons be?

  • To have a workforce capable of satisfying promises made to the previous generation now retiring.
  • To have a substitute for falling birth-rates in a country of high tax and high living costs where families are becoming less affordable.
  • To provide voters for political hucksters and opportunists with an eye to power at all costs

….among a myriad of short term fixes to problems often of the state’s own manufacture.

In Scotland, we have a strange brand of National Socialism, which calls itself “Civic Nationalism”. This grew up in the age of unchallenged left wing dogma and rampant warriors for social justice. To talk about race or ethnicity, or culture or history was the greatest of crimes. Nationhood was to be merely (or as we will see mostly) defined by geography, no other social science was relevant. Where you are located is all, make it across the line on the map with the right paperwork, or appropriate excuse and you are in brother. No further questions asked, or indeed permitted.


Or so it is claimed. The reality is, as always, more complicated and more threatening. For even the SNP realised that geography is not enough. But as good social Justice warriors they saw ethnicity, history, culture and faith as “divisive”. Rather, they have implicitly introduced another requirement: adherence to the basic tenets of the PARTY. Thus the “others” that are now demonised are the “Tories” (which has echoes of the American Revolution which was built on Scottish Enlightenment ideas). I initially thought “Tories” was merely a euphemism for “English” – a means of hiding a common prejudice. That is wrong however, for although the less educated and more bitter supporters of “Civic Nationalism” do exhibit this trait it is NOT the party line. The “Tories” are Scots who have become “traitors”, “quislings”, “uncle tams”, “Yoons”. They are thus no longer true Scots by the SNP’s definition. Though they are the majority, they are nonetheless foreigners in their own land.

Thus eschewing the traditional idea of nation as an extension of family, the SNP/Scottish Left also turn away from the tolerance and pluralism inherent in that view, the acceptance of diverse opinions as all part of the mix. They will tolerate any variety, except a variety of ideas. But that approach though toxic and inherently totalitarian nonetheless ignores all the really important issues surrounding what makes a nation a nation; and what defines a people. It draws no distinction between being kind to the stranger in your midst and allowing that stranger to become a full participant in the life of the nation. It repeats the error made by the left all across the western world; It belittles the very idea of nationhood.

We have recently lived through a prime example of this lack of regard for nationhood. Tony Blair’s Labour government sought to change our society by means of mass immigration, without asking the people of course. It was belatedly reported in the Telegraph here:


The huge increases in migrants over the last decade were partly due to a politically motivated attempt by ministers to radically change the country and “rub the Right’s nose in diversity”, according to Andrew Neather, a former adviser to Tony Blair, Jack Straw and David Blunkett

So we have political manipulation, resulting in the initiation of huge changes in the nation that are neither discussed nor approved by those who will be affected. Worse still, it seems to be built on two equally shaky foundations:

  1. The politically correct notion that the race/culture of our island (and indeed the whole of Western Society) is defective and must be changed so that we can learn tolerance; and that to question or even highlight this assumption makes a critic a right-wing racist xenophobe.
  1. The new religion of the political left, – multiculturalism, equality of all, absolute majority rule, identity politics subdividing every country into competing interests – will create from any human grouping a nation as secure as one based on the ties of extended family, shared culture and values, law and history, and built gradually over time.

Should anyone consider this summary too strong, please view the German Green Party’s Dr. v. Berg stating in their parliament that it is a good thing that Germans will soon be a minority in a new “super-cultural” society which will displace any uniquely German culture.

The absurdity of this position in Britain and Scotland was recently and spectacularly highlighted by the doyen of the metrosexual media – The Huffington Post.

Scottish independence is now the last redoubt behind which everyone across the UK who believes in human solidarity, internationalism, and a multicultural society must gather to stem the rising tide of Brexit poison that threatens to drown us all.

You really could not make it up: A nationalism is now the last best hope for internationalism!

This foolishness shows a wider problem, the political left (and in the UK all significant parties are of the political left) has ceased to be relevant. Events are now being driven by forces they cannot control and do not understand. These are effects largely caused by their amateur tinkering with the nature of the nation, and the idea of a people (and equally amateurish tinkering with the economy). That tinkering goes back 100 years to the aftermath of the first world war and the Wilsonian dreaming of a new order in which all nations are equal (and the USA is more equal than others), This involved an attack on both European culture and British culture which somewhere along the line became ingrained in the left. Add the ill-starred influences of Gramsci and Lukacs; the Frankfurt School, the communist manifesto and political correctness and you have a political culture where the nation must die, indeed is perceived to be already out of date, anachronistic, backward. It must be replaced by the super-state and eventually by the world state. Hence the SNP and mainstream left’s buy-in to the European project and abandonment of the idea of Great Britain (a viable and powerful independent Nation).

But no-one asked the people – and in return the people are now asking questions that the political elite cannot answer.

I contend that we must find our own answers, rooted in an understanding of both who we are as a people and the nature of mankind. The absolute values of right v wrong, truth v deception, peace v strife and love v hate must be reasserted. These are, first and foremost, matters for the individual, as we daily have proof that the state cannot discern right from wrong, only operates with lies, finds its strength in war and is incapable of love. We must each make those choices and re-establish what we mean by a nation once again. It is more than a welfare system, a tax and spend overlordship and an NHS. It is shared values that do not prevent dissent, if is mutual care that is not dependent on the theft of taxation, it is shared faith that does not prevent frank examination of that faith, it is a loose extension of the family to the kindred both those related by blood and those welcomed from other nations.

Our political leadership has sought to destroy the family, the church, the nation; all things which bind us together. We must refuse to follow them to perdition and instead rebuild what they have wasted.

The “Named Persons” Scheme – Making Scotland a National Panopticon

by admin

The Children and Young People (Scotland) Act 2014 created the role of the named person; a state appointed guardian for every child. This is a state functionary charged with monitoring the child’s well-being and who is required by statute to organise rapid and very early intervention into family life by any and all branches of the state if that vital well-being is threatened, or even might conceivably be threatened in the future.

This might seem all a little bit “East German”, a sentiment expressed by the BBC’s Gordon Brewer at 10:39 into this interview with the minister responsible – Aileen Campbell MSP. That however should merely pique our curiosity regarding why such a totalitarian policy should be introduced into the land once home to the ideas of Adam Smith and The Scottish Common Sense school of Philosophy. Surely a common sense approach to family life is incompatible with universal monitoring of every child. From whence, we should therefore ask, did such an idea arise?

alieen campbell brewer

Looking at the underpinnings of the named person idea we meet at every turn the acronym “GIRFEC“, which stands for “Getting it Right for Every Child”, and which bears many similarities to the US Scheme “No Child Left Behind” and the English “Every Child Matters”. Of GIRFEC we are told:

Getting it right for every child is important because it improves outcomes for all children. It does this by creating a single system of service planning and delivery across children’s services…[it]….

…consistently identifies at an early stage children who need help

But, when pressed on the totalitarian and anti-liberal aspects of a compulsory scheme of data sharing and state over-sight of family life, the reassuring words morph into something else. Ultimately the justification rests on two key benefits:

  • Saving the cost to the public purse
  • Saving the lives of vulnerable children

Let us therefore examine these two bottom lines in the GIRFEC calculus

The public purse in a modern welfare state is greatly harmed if the citizens are not on the whole productive, healthy and law-adiding. The welfare state, however, is a system which subsidises idleness, illness and where the criminal justice system  is a huge financial drain on government coffers. Clearly, we have a problem. The GIRFEC solution is based on the belief that early years development is vital (3 years old is too late) and that by intervening in families at an early stage problems can be nipped in the bud. Social decay can be reversed, Prison populations can be slashed, Hospital wards can be emptied. All that is needed is a little more state involvement; a little more compliance form the populace. The cost of the named person scheme and of the early intervention that it entails will be repaid many times over in reduced welfare bills in the new, happier Scotland that will be created. It is the state version of:

Cast thy bread upon the waters: for thou shalt find it after many days.(ecc 11:1)

Saving the vulnerable child plays upon the normal response of mankind to wish to care for and protect those too young to look after themselves and the common revulsion we feel at a report of an innocent child being harmed. However, as most children who are harmed are either in state care or are known to, and already “safeguarded” by government social workers and child protective services, this the appeal is not what it first seems.  To  reason that “if it saves just one child” the scheme is justified is not to demonstrate that the introduction of this system will, with any certainty save a child. Rather it relies on what many instinctively see; that abused children commonly live such disordered, chaotic, random and dangerous lives that any system, however illogical or oppressive could, with luck, perhaps make a difference on rare occasions. Who is to say it would not? Such is the gut reaction against child abuse this argument plays strongly. This however ignores the less obvious, but more certain effect of government intervention into family life – harm.

Harm can come in many forms:

  • Children and young people damaged by vaccines
  • Sick children  made worse by harmful medical intervention
  • Families broken under the pressure of unwarranted investigation
  • Children wrongly taken into care (and children in state care have the greatest risk of abuse and the poorest life chances)
  • The mis-use of power by state functionaries for their own ends
  • Paedophilia within state organisations dealing with children
  • Suicide by parents who have lost their children to wrongful state intervention

amongst a whole panoply of horrors inflicted daily on innocent families all across the country.

Thus, what is unsaid in this scheme, is that there is no guarantee the state will get it right for each child, for your child, the aim is to reduce costs and harm on a population-wide basis. That this is done by early intervention before problems become significant and with practitioners warned “doing nothing is not an option” is to admit that unwarranted and unnecessary state intervention in family life is part of the plan. It is simply that the state calculates that it will be to the state’s net benefit; the the harm will be outweighed by the good. There is a word for this philosophy; the word is utilitarianism.

Utilitarianism’s prophet was Jeremy Bentham (1748-1832) who defined the fundamental axiom of his philosophy as:

it is the greatest happiness of the greatest number that is the measure of right and wrong

jeremy bentham

This is named person in a single line. It even uses the same word “happiness” as the Scottish Government often  substitutes for well-being. However Bentam went further with his felicific calculus which measured the pleasure and pain felt by an individual or by groups. To assist in remembering the seven variables he invented the following little ditty:

Intense, long, certain, speedy, fruitful, pure—

Such marks in pleasures and in pains endure.
Such pleasures seek if private be thy end:
If it be public, wide let them extend
Such pains avoid, whichever be thy view:

If pains must come, let them extend to few.

The Scottish government have gone one better with a 8-indicator approach and an acronym (there is always and acronym) SHANARRI – safe, healthy, achieving, nurtured, active, respected, responsible, included. The message is the same however “If pains must come let them extend to few”

Murray Rothbard considered this pleasure pain calculus in volume II of his History of Economic Thought; significantly, he noted:

But one thing can be said for Bentham’s grotesque doctrine. At least Bentham attempted, no matter how fallaciously, to ground his cost-benefit analysis on an objective standard of benefit and cost. Later utilitarian theorists, along with the body of economics, eventually abandoned the pleasure-pain calculus. But in doing so, they also abandoned any attempt to provide a standard to ground ad hoc costs and benefits on some sort of intelligible basis. Since then, the appeal to cost and benefit, even on a personal level, has necessarily been vague, unsupported and arbitrary.

41tIr-VPbjL._SX331_BO1,204,203,200_ MurrayBW

Thus we have a system in Scotland dedicated to well-being, a quality that the proponents of this policy cannot define, let alone measure. Vagueness is all around. A further insight from Rothbard is the concentration on outcomes.

…in addition to the problems of the pleasure-pain calculus, personal utilitarianism counsels that actions be judged not on their nature but on their consequences. But, in the non-Bethamite, mere cost-benefit (rather than ‘objective’ pleasure-pain) analysis, how is anyone to gauge the consequences of any action? And why is it considered easier, let alone more ‘scientific’, to judge consequences than to judge an act itself by its nature? Furthermore, it is often very difficult to figure out what the consequences of any contemplated action will be. How we are to find the secondary, tertiary, etc. consequences, let alone the more immediate ones? We suspect that Herbert Spencer, in his critique of utilitarianism, was correct: it is often easier to know what is right than what is expedient.

Wise words, yet the Scottish Government remains convinced that its functionaries will be able to use compulsion when intervening in family life before any problem escalates to be of major concern and that this patently unlawful conduct can be justified by the claimed future benefits.

How then should we sum up the plans of the Scottish Government to introduce a compulsory state guardian to oversee the happiness of every child whilst admitting that it will involve harm to some children, perhaps to your chlld, for the greater good? There is an architectural quality about this construction, so towering and vast is the scheme, so shiny the facade, so rotten the foundations, that suggests an architectural metaphor. And Bentham provided one – the panopticon. Returning to Rothbards’s description:

‘Panopticon’, in Greek, means ‘all-seeing’, and the name was highly suitable for the object in view. Another Benthamite synonym for the panopticon was ‘the Inspection House’. The idea was to maximize the supervision of prisoners/school children/paupers/employees by the all-seeing inspector, who would be seated at a tower in the centre of a circular spider-web able to spy on all the cells in the periphery. By mirrors and other devices, each of the spied upon could never know where the inspector was looking at any given time. Thus the panopticon would accomplish the goal of a 100 per cent inspected and supervised society without the means; since everyone could be under inspection at any time without knowing it. Bentham’s apologists have reduced his scheme to merely one of prison ‘reform’ , but Bentham tried to make it clear that all social institutions were to be encompassed by the panopticon; that it was to serve as a model for ‘houses of industry, workhouses, poorhouses, manufactories, mad-houses, lazrettos, hospitals, and schools’. An atheist hardly given to scriptural citation, Bentham nevertheless waxed rhapsodic about the social ideal of the panopticon, quoting from the Psalms: ‘Thou art about my path, and about my bed; and spies out all my ways … ‘ As Professor Himmelfarb aptly puts it: Bentham did not believe in God, but he did believe in the qualities apotheosized in God. The Panopticon was a realization of the divine ideal, spying out the ways of the transgressor…

What more more perfect metaphor for the named person scheme could be found than the Panopticon?


by admin

Item number 1 in the Commonweal big book of ideas is a strange and telling, even apologetic starting point; it is:

We raise the top rate of income tax (£150k and over) back to 50p, after being brought down to 45p under the last Tory-Lib Dem coalition government in 2013. A conservative estimate of an extra £20 million will be brought in from this.

Firstly we should note the government revenue generated by this measure is a meagre £20 Million – this equates to 1 penny per person per day for those resident in Scotland – or approximately 0.03% of the required revenues of an independent Scotland. An immediate question is therefore “Why bother?” The reasons must be due to concerns other than revenue

That is of course assuming tax revenues go up; they equally could go down for, as  Alan Manning of the Centre for Economic Performance, London School of Economics and Political Science noted in his paper on the top rate of income tax:

Reported taxable income falls as tax rates increase. So rises in the top tax rates bring in less government revenue than one would predict assuming taxable income does not respond. Indeed, tax revenue might even fall.

It should be emphasised that we know very little about many of the parameters needed to estimate the total revenue effects.

EA029 1

So why would Big Idea number #1 be such a pathetic and weak measure, which might yield little if any government revenue?

For the answer we turn to Frank Chodorov, he wrote what became an American classic arguing that the income tax, more than any other legislative change in American history, made it possible to violate individual rights, one of the founding principles. This work was called Income tax- The root of all evil.  In it he argues that income taxes are different from other forms of taxation because they deny the right of private property and presume government control over all things. This is available as a free download or bound volume from the The Mises Bookstore.

Income Tax_Chodorov_20140513_Cover

Two Mises daily articles examine the destructive power of taxation:

How The Power To Tax Destroys,  JUNE 29, 2005 Michael Rozeff


To Tax Is to Destroy, APRIL 28, 2011Fred Buzzeo

The later article discusses a landmark court decision:

The landmark Supreme Court decision McCulloch v. Maryland (1819) has had wide impact on the powers of the federal government. In fact, this decision, more than any other, is responsible for the incredible growth of federal authority throughout the years. Today, Washington has a tight grip on every aspect of our lives, and much of this federal intrusion is due to the “implied powers” doctrine that emanated from this court decision.

In the case, the clerk of the Bank of the United States, James McCulloch, brought action against the state of Maryland. In opposition to the national bank, Maryland had imposed a tax on the Bank of the United States — hoping to tax it out of existence. McCulloch took the position that such a tax was an unconstitutional interference with the activities of the federal government by a state — in this case Maryland. Therefore, McCulloch brought action to stop Maryland from taxing the national bank out of existence.

Pleading the case on behalf of McCulloch, the eminent jurist Daniel Webster argued that Maryland had no authority to tax the bank. The essence of his argument was quite simple: “An unlimited power to tax involves, necessarily, a power to destroy.”

The court agreed. Speaking for a unanimous court, Chief Justice John Marshall echoed Webster’s words. He wrote, “The power to tax implies the power to destroy. If the States may tax one instrument, may they not tax every other instrument…?

Ha so we see the reason that the Commonweal’s first and foremost idea is a financial non-starter but a political imperative. They aim to destroy those considered too wealthy, too gifted, too fortunate. The implication would appear to be that wealth redistribution will raise up those less fortunate.

Now we at Mises Scotland consider such behaviour to be ethically indefensible. We are not alone in this view

Thou shalt not steal

 Thou shalt not covet thy neighbour’s house, thou shalt not covet thy neighbour’s wife, nor his manservant, nor his maidservant, nor his ox, nor his ass, nor any thing that is thy neighbour’s.

Exodus 20; 15 & 17 KJV

But putting aside for the moment the commandments of the Lord , as seems to be the fashion nowadays, and all other ethical concerns we can ask a further question, will such a taxation policy succeed in making the poor less poor in absolute terms?

Seeking clarity and simplicity on this matter, let us turn to Hazlitt’s classic Economics in One Lesson

The whole of economics can be reduced to a single lesson, and that lesson can be reduced to a single sentence. The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups. (p.17)

Taxes Discourage Production: “The government spenders create the very problem of unemployment that they profess to solve….the larger the percentage of the national income taken by taxes the greater the deterrent to private production and employment.(pp. 38-39)

In brief, the main problem we face today is not economic, but political. Sound economists are in substantial agreement concerning what ought to be done. Practically all government attempts to redistribute wealth and income tend to smother productive incentives and lead toward general impoverishment. (our emphasis)

Economics in One Lesson (1)

Ludwig von Mises in Economic Policy expanded upon the mechanism of impoverishment at play here:

Progressive taxation of income and profits means that precisely those parts of the income which people would have saved and invested are taxed away.

Economic Policy_Mises

And it is only by saving and investment, the true engines of growth, that the productivity of labour can be increased, and only with increasing productivity can we command a better standard of living.

So we can see that the Commonweal aim to increase government control over the individual and his or her property not caring that this will lead to both general impoverishment and loss of liberty,

Let us leave the closing comments to Henry Hazlitt

It is the proper sphere of government to create and enforce a framework of law that prohibits force and fraud. But it must refrain from specific economic interventions. Government‟s main economic function is to encourage and preserve a free market.

When Alexander the Great visited the philosopher Diogenes and asked whether he could do anything for him, Diogenes is said to have replied: “Yes, stand a little less between me and the sun.‟ It is what every citizen is entitled to ask of his government.

In our land of mist and rain, the Commonweal should have more sense that to block out the sun from industrious and ingenious Scots.


Photo from @frenchscotjeff via @VisitScotland

The Young ME Sufferers Trust: Why We Oppose The Named Person Legislation

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This is a speech given at the Scottish Liberty Forum event ‘Named Person and the Death of the Family’ Lesley Scott Scottish Officer, The Young ME Sufferers Trust.


Tymes Trust is the longest established national UK service for children and young people with the neurological disease Myalgic Encephalomyletis (ME) and their families. To give some context to our opposition to the Named Person legislation, our executive Director Jane Colby wrote in her paper “False Allegations of Child Abuse in Cases of childhood Myalgic Encephalomyelitis (ME)” that “There is no cure for ME. In its absence, management regimes are prescribed, typically based on cognitive behaviour therapy (CBT) and graded exercise therapy (GET). In the case of children this may involve the application of Child Protection powers to enforce treatment […] Parents who decline or withdraw children from management regimes, which may have worsened their illness, can find themselves facing investigation for child abuse or neglect.”

Calls to Tymes Trust Advice Line from Scottish families facing such investigation now have GIRFEC and the Named Person at the heart of them.

Recently on a Radio Scotland phone-in a presenter stated that “In place in Scotland at the moment we have the very successful GIRFEC system, Getting It Right For Every Child, which is about nurturing and protecting children …” [Louise White, Radio Scotland 28th Dec 2015 http://www.bbc.co.uk/programmes/ b06sp5vd] I found this a somewhat surprising statement and wondered on what evidence this resounding endorsement was based, given that it was due to a failure to embed GIRFEC throughout the 32 Scottish local authorities that had led a frustrated government to legislate it into statute.

GIRFEC as an approach has been around for some time, but understanding of its process was divergent amongst practitioners and implementation irregular across services. Only through the use of statutory powers making GIRFEC a legal duty could, it would seem, government realise its vision of the universal embedding of GIRFEC across the country. Which raises the question that if it is such a wonderful scheme why does it require the strong arm of statutory legislation in order for the workforce to employ it? And yet GIRFEC, as the Scottish Government documents tell us, already “threads through all existing policy, practice, strategy and legislation affecting children, young people and families.” [A Guide to Getting it right for every child http://www. gov.scot/resource/doc/1141/0065063.pdf]

GIRFEC pervades all aspects of the state’s interaction with parents and children. The Named Person or state guardian scheme is, in the government’s own words a “key element of the GIRFEC approach” and the powers that have been given to these state functionaries through the Children and Young People (Scotland) Act reflect the comprehensive reach and implication of GIRFEC requiring as they do the legally enforceable cooperation of all sectors, agencies and organisations who are involved with children, young people and families, even adult services where the adult is also a parent.

An industry has grown up around children and their parents that promotes a shift in authority and responsibility away from parents and towards the state

However there appears to be a concerning lack of awareness amongst the general public of the absoluteimpact of GIRFEC and the Named Person scheme which hides its illiberal and authoritarian intent behind the banal aim of “Making Scotland the best place to grow up.”

An industry has grown up around children and their parents that promotes this shift in authority and responsibility away from parents towards the state. It encourages parents to think themselves inadequate to the task and undermines their confidence in how they parent their own children.

… government identifying what they consider to be defects and enforcing corrective measures …

There are ever increasing numbers of parenting programmes such as CANparent, Mellow Parenting and Parentskool (spelt s-k-o-o-l) with mission statements about every parent achieving their best through the involvement of ‘professional’ parenting practitioners; then there are organisations like the Social Research Unit Dartington, and the Early Intervention Foundation which gather and assess data on children and families to inform both local and central government on the implementation of early intervention initiatives and promote investment in effective early intervention to local and national policy makers.

As part of this industry in Scotland the Early Years Collaborative is a Scottish Government initiative billed as “the World’s first multi-agency, bottom up quality improvement programme to support the transformation of early years.” [http://www.gov.scot/Topics/People/ Young-People/early-years/early-years-collaborative]. It is concerned with putting in place practical actions that will accelerate the conversion of processes and culture within public services to reflect the GIRFEC ideology of early intervention and prevention. To assist in this endeavour all 32 local authorities utilise Community Planning Partnerships which comprise all relevant public, private, voluntary and community bodies in its area to set out a joint vision with agreed objectives in the form of a Community Plan.

The Early Years Collaborative has, through so-called Learning Sessions, educated these Community Planning Partnerships on how to achieve their objectives through something called small tests of change or Plan-Do-Study-Act cycles which actually replicate a process that was developed in the 1950s by William Deming the American statistician, educator and consultant. Deming pioneered his Plan-Do-Study-Act cycles within the manufacturing industry to improve quality control based on a systematic tallying of product defects that includes the identification and analysis of their cause. Once the causes of defects are corrected, the outcomes are tracked to measure the effects of those corrections on subsequent product quality helping management continually gain more and better knowledge particularly about its processes and products.


For full article refer to :

The Young ME Sufferers Trust


Bought and Sold for GIRFEC Gold; How Government Buys Third Sector Allegiance

by admin

The first part of the title to this article is specific to Scotland and is taken from a Schoolhouse article of the same name.logo1

The second part of the title has worldwide application for the world-over Governments have learned to buy people. To have those people organised into worthy-sounding groups called “not-for-profit organisations” and “charities” suits the government objective for it hides the true nature of the transaction. This is the so called “halo effect”.

First let me explain those aspects which are specific to Scotland. The reference to gold is from Robert Burns’ poem  Such A Parcel Of Rogues In A Nation, which is still politically controversial after 300 years as it describes the bribery-fuelled decision of the Scots parliament to vote for union with England to create a new country called Great Britain. The key phrase is:rabbie

But pith and power, till my last hour,
I’ll mak this declaration;
We’re bought and sold for English gold-
Such a parcel of rogues in a nation!

The whole poem is also sung, and you can listen to it here.

So you’ll get the basic gist, betrayal of ancient and timeless principles for filthy lucre. And this brings us nicely to GIRFEC. This is the government acronym (and how they love their acronyms) for Getting It Right For Every Child; the Scottish Government version of “No Child Left Behind” in the USA and “Every Child Matters” in England. This programme embodies the view that only the state can prevent individual failure on the part of parents to raise their children in the correct manner, with the required beliefs, training and ability. The Scottish Government go so far as to list the essential and desirable qualities of every child; they should be successful learners, confident individuals, effective contributors and responsible citizens.

The stormfront of this policy is called the Named Person scheme – the dreadful idea that every child should have a state -appointed guardian or overseer. Named persons will be  single points of contact for anyone who has information to share about a child or their family. This information will address concerns that the child well being is  (or may in future) be affected by any matter arising from any factor. And for those who doubt that the Scottish Government would undertake anything so totalitarian, here is the quote from the draft statutory guidance:

When is a Child’s Plan required?
13.4.2 There are two main considerations in deciding if a child requires a Child’s Plan. The first is based on an assessment of wellbeing, as set out in Section 96 (2) and further explained in the Wellbeing section of this guidance. The child must be assessed as having a wellbeing need in terms of the wellbeing indicators described in the Act. This means that a judgement has been made that the child’s wellbeing is currently being adversely affected by any matter, or is at risk of being adversely affected, as specified in Section 33 (2). The adverse effect may be on one or more aspects of wellbeing and can arise from any factors relevant to the child. This judgement will usually be made by the Named Person, based on a holistic knowledge of the child, and informed by the use of the National Practice Model.


And where will the government get the information? Well, from everywhere; specifically from everyone on the payroll. The recent discovery that Borders Council are instructing taxi-drivers, hired by the council to ferry children and vulnerable adults to and from school, to report on overheard conversations  is the latest in a long line of damaging revelations concerning this scheme. The Scottish Daily Mail (28th Dec 2015) reported the story and called the policy “stasi-like interference into family life,”

Now to the specific example of betrayal; the Nationalist-supporting newspaper “The National” rushed to defend the government position on the taxi-driver-spy issue. In terms of factual information they could only confirm that the story was in fact accurate in all important regards. Their reply instead focussed on narrow party politics and asks the question who supports the scheme. Now this is of course a logical fallacy (appeal to authority) but what is interesting is the authorities used to bolster the roll-out of totalitarianism.

Parenting Across Scotland, Action for Children, Aberlour, Barnardo’s Scotland, Scottish Youth Parliament, Children 1st, Together (Scottish Alliance for Children’s Rights), One Parent Families Scotland, Scottish Childminding Association, Quarriers, Royal College of Nursing and the NSPCC have all thrown their weight behind the plan.

One state trade union and eleven charities.

As for the Royal College of Nursing, they say of themselves:

The Royal College of Nursing (RCN) is the UK’s largest professional association and union for nurses with around 425,000 members, of which around 39,000 are in Scotland. Nurses and health care support workers make up the majority of those working in health services and their contribution is vital to delivery of the Scottish Government’s health policy objectives.

And with the NHS representing almost the whole of the health sector in Scotland, this organisation has 39,000 members n the Scottish Government payroll.

But what of those independent charities? Charities are also funded by the Scottish Government and here is the announcement of £14.7M of funding for the year 2015/16. Let us compare the list of charities receiving government funding in this current year with the list of eleven charities supporting state monitoring of child well-being and so of family life:

Parenting Across Scotland http://www.parentingacrossscotland.org/  £          167,630.00
Action for Children https://www.actionforchildren.org.uk/  £          114,917.00
Aberlour Child Care Trust http://www.aberlour.org.uk/  £          209,209.00
Barnardo’s Scotland http://www.barnardos.org.uk/  £          232,790.00
Scottish Youth Parliament http://www.syp.org.uk/  £          325,000.00
Children 1st http://www.children1st.org.uk/  £          271,890.00
Together (Scottish Alliance for Children’s Rights) http://www.togetherscotland.org.uk/  £            31,460.00
One Parent Families Scotland http://www.opfs.org.uk/  £          354,150.00
Scottish Childminding Association http://www.childminding.org/  £          249,550.00
Quarriers, https://quarriers.org.uk/  £          211,498.00
The NSPCC https://www.nspcc.org.uk/  £          160,000.00
Total  £      2,328,094.00

So we see 11 from 11 receive substantial government grants; they support the government policy. To do otherwise would likely reduce their most significant and reliable revenue stream. It would also exclude them from “influence” on those in power.

Bought and sold, not for English gold, but for Scottish Government base metal coinage, these charities have not betrayed a nation so much as each and every single family within it. Oh that we had today a national poet of the stature Robert Burns to put the corruption in to song and verse for future generations to marvel at the weakness of man.

For, as even Scots-American socialist Upton Sinclair recognised

It is difficult to get a man to understand something, when his salary depends upon his not understanding it!



The Tangle of Well-being

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In the fifth chapter of Hayek’s road to serfdom, the chapter opens with a quote from Kirkcaldy’s son Adam Smith. It is as follows:

“The statesman  who should attempt to direct private people in what manner they ought to employ their capitals, would not only load  himself with a  most  unnecessary  attention,   but assume  an  authority  which could  safely  be trusted  to  no council and  senate  whatever, and which would nowhere be so dangerous  as in the  hands  of a man who had folly and presumption enough to fancy himself fit to exercise it.”

In modern Scotland, there is only limited support and government moves towards controlling the economy as a whole. Certain aspects are identified as being most in need of the tender touch of the totalitarian state. At present these are:

Land Ownership



Now you might be surprised at this starting point; how can a government who believes it should have more limited control over the economy seek to take the lead in raising every single child in the land? The answer lies with the Scottish model of government, an entirely new beast using ideas from America, from the UN and influenced by the manifest failure of both Soviet style state control and western welfarism. This mode of Government seeks to enlist the individual, with their unique creativity, in state directed ways. The state therefore is to define the outcomes required of us. We are free to engage our individual brilliance, but only insofar as this generates the required outcomes. This is an attempt to ape freedom without permitting genuine liberty to emerge.

Hence the Scottish Government have defined the outcomes of  child rearing, land use and economic activity and claim the right to continue to do so forever-more. In the area of family life, woe-betide those whose children fail to meet this specification; or those who some government official predicts will fail, for the mere belief in the mind of our wise overlords that the interests of the child may be affected in the future is enough for early intervention.

The key word is well-being. For a sample of the government propaganda on this subject, see these links:

Wellbeing explained to Young People

Scotgov page on wellbeing


Well-being is everything, and to improve well-being we are told we need state involvement in private family life; all in the interests of the child you understand. And well-being is now enshrined in primary legislation, the Children and Young Peoples Act. So what, you might be wondering is the definition of well-being? That dear reader , is not so clear:

Well-being is not a beach you go and lie on. It’s a sort of dynamic dance and there’s movement in that all the time and actually it’s the functionality of that movement which actually is true levels of well-being (Nic Marks, Radio 4, 7 January 2012).

Clear yet?

“a complex, multi-faceted construct that has continued to elude researchers’ attempts to define and measure it” (Pollard and Lee 2003)

How about now? The short answer is it cannot be defined, it is happiness, it is all encompassing satisfaction, in Glasgow it might be expressed “How are ye, in yersel?”.


Hayek saw this issue in the 1940’s and wrote about it in Road the Serfdom

The “social goal”, or “common purpose”, for which society is to be organised, is usually vaguely described as the “common good”, or the “general welfare”, or the “general interest”. It does not need much reflection to see that these terms have no sufficiently definite meaning to determine a particular course of action. The welfare and the happiness of millions cannot be measured on a single scale of less and more. The welfare of a people, like the happiness of a man, depends on a great many things that can be provided in an infinite variety of combinations. It cannot be adequately expressed as a single end, but only as a hierarchy of ends, a comprehensive scale of values in which every need of every person is given its place. To direct all our activities according to a single plan presupposes that every one of our needs is given its rank in an order of values which must be complete enough to make it possible to decide between all the different courses between which the planner has to choose. It presupposes, in short, the existence of a complete ethical code in which all the different human values are allotted their due place.

So Hayek saw, what few in contemporary Scotland can see; that state control of general well-being means state control of the ethical code by which we live our lives.


What, dear reader, could be more totalitarian than that?


Taking The High Road to Serfdom

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Take the High Road; is an piece of the lyric to the traditional Jacobite lament “The Bonnie Banks of Loch Lomond”. It is from the chorus:

O ye’ll take the high road, and I’ll take the low road,
And I’ll be in Scotland afore ye,
Where me and my true love will never meet again,
On the bonnie, bonnie banks o’ Loch Lomond.

This refers to a Scots tradition and belief that when a Scot dies his/her soul/spirit shall travel to Scotland before passing onto the next world which is called the low road in the song. The high road belongs to the living and the low road to the dead.

Written in dark days following the defeat of the Jacobite cause, this song has become a much loved part of contemporary Scots culture, it is sung at weddings, dances and football stadiums, any in doubt of this should view the following video:

In the dark days of 1940’s Europe, economist F A Von Hayek saw another road, a road from the collective effort of war to a collectivisation of the peace and of society as a whole. The end of road he saw was a loss of liberty so complete and impoverishing (both economically and spiritually) as to merit the name “serfdom”.


In contemporary Scotland we see a headlong, and largely unnoticed rush along that road; nationalism and socialism are meeting to create an impetus to ever more complete and invasive state control of all aspects of life. The background is a social-democratic state with those concepts taken to their logical conclusion. It current signs are attacks upon the family, upon property rights, and upon any seat of competing political, cultural or economic authority.

Those responsible are taking the High Road as defined in the song as they are very human, very alive and bringing their beliefs home to Scotland. They consider themselves to lewisbe taking the high road as an American might understand the term; as they bring a a morally superior approach towards each new enslavement. As CS Lewis explained this is the worst of all tyrannies:

“Of all tyrannies, a tyranny sincerely exercised for the good of its victims may be the most oppressive. It would be better to live under robber barons than under omnipotent moral busybodies. The robber baron’s cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who torment us for our own good will torment us without end for they do so with the approval of their own conscience. They may be more likely to go to Heaven yet at the same time likelier to make a Hell of earth. This very kindness stings with intolerable insult. To be “cured” against one’s will and cured of states which we may not regard as disease is to be put on a level of those who have not yet reached the age of reason or those who never will; to be classed with infants, imbeciles, and domestic animals.”

Our wise overlords have us on the High Road to Serfdom; in this blog series we shall explore each step, drawing insights from Hayek’s 1940’s masterpiece and arguing that freedom not servitude is the natural and happy state we should work towards.

Looking at The Common Weal Big Book of Ideas

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Scotland is in the midst of extensive debate concerning its future as a nation and how it should be governed. Two major aspects of this debate are sadly inadequate however.

The question of liberty is often raised in a collectivist framework – the liberty of the country as a single indivisible whole. The question of liberty as understood by Mises and by the whole classical liberal tradition – that is individual liberty – is rarely raised.

The related issue of how an economy should operate, whether by central command, free enterprise within a tightly state regulated environment or by laissez faire principles is likewise seldom examined.

In short the path of liberty is ignored. If it is considered at all, it is rapidly dismissed as too harsh, or too risky, or too unworkable or too unfair.

To reveal the errors in this contemporary narrative, The Mises Institute of Scotland will examine, week-by-week, the 101 Big Ideas defined by The Common Weal, a collectivist think-tank much involved in the national debate . They have published their ideas in book form, unsurprisingly called “A Book of Ideas”. It can be purchased here.




It should be fun!