Monthly Archives: March 2010

Concert tickets and the free market

Earlier this week I heard another discussion on You and Yours about ticket touting and the ‘no ticket’ scammers that try to rip off gig goers. One comment by the chair of the culture, media and sport select committee had me spitting out my tea, and then laughing heartily.

The story was ostensibly prompted by Muse’s plan to only sell tickets through their own site, so hoping that only the fans who actually want to go (‘the true fans’) can get tickets, as opposed to those who want to buy some and then resell at a higher price. This reselling, known as the ‘secondary market’, won’t be outlawed as government can see the ‘advantages for consumers’ (, p. 2), and as society seems to believe in the primacy of the market it would seem absurd to say that reselling has to be at face value. If this were the case, then those who get the tickets are just those quickest to act, and some ‘true fans’ still wouldn’t be able to go. At least with the clearing mechanism of the touts, those who want to go most (as measured by willingness to part with cash) get to go, and one never hears complaints about being able to buy tickets at less than face value from the touts!

But the concern here is the selling of tickets that haven’t been released yet. Of course there are some scammers who pretend to have a ticket, sell and fail to deliver: this is fraud. However, there are others who sell a forward contract on the tickets, taking someone’s money to deliver tickets that they are sure they will have at the point at which they need to sell:

Winifred Robinson: Would you support the idea of making it illegal to sell tickets that you don’t have in your possession? Because often in defence afterwards, these online sellers who don’t deliver will tell you that someone else let them down.

John Whittingdale, MP: Well, if you are trying to sell something you don’t deserve(?), then that is a criminal act in itself…

This is where I laughed. I laughed because selling something you don’t have in your possession is pretty common, and arguably the basis of our entire financial market, and a large part of our non-financial economy too. Futures trading, forward trading and a whole host of derivatives are based on buying and selling ‘promises’ as opposed to the actual commodities or shares.  Even in the old-fashioned manufacturing industries, importation and retail, money can be handed over before the goods are in existence, never mind in the sellers hand (known as ‘paying up front’, and I imagine the MP has heard of this). And sometimes someone further up the chain may let the seller down, and the deal doesn’t happen. Money can be returned, bankruptcies occur, and so on. Some end consumers can make losses like this too: if you pay for a telly online, and then the import company goes bust, you an end up with nothing. I don’t think the government is thinking of making all of this economic activity illegal too… that would be ridiculous.

If regulation is needed to counter the risks of default, perhaps they should start with the financial markets. After all, if we take the most cited reason for the current economic difficulties – sub-prime mortgage defaults – what we find is a number of financial bodies trading in future income streams (the repayments of homeowners) that in the end didn’t come in. They may have been wrapped up in credit default swaps and collateralized debt obligations, but effectively people were trading in the the future monthly payments of householders, as this is where the profit would come from eventually. It wasn’t these payments that were in the hands of the sellers, but promissory notes for these payments, and as we have seen some of these payments aren’t being made. How this differs from selling a gig ticket you don’t own yet, I can’t see.

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Income distribution

A couple of weeks back I went to a debate about the legacy of the miners’ strike. There was a lot of shouting at Edwina Currie, being the only Conservative there, and a member of the government at the time. There was an element of nostalgia too, with mining jobs being romanticised a bit too much (George Galloway and Ken Loach were there too). However, the fact remains that these dirty and dangerous jobs seem to pay better than the service sector jobs that have replaced them.

One of the more interesting claims was that British workers have really good earnings. Edwina pulled out the ‘creative industries’ argument, like Charlie Leadbeater’s Living on Thin Air, effectively saying we could all be earning good money designing computer games. It is of course true that the average British wage is high, and the creative industries is profitable. But for the worker at the bottom of the pile, it’s the distribution that counts.

For example, if a company makes £1m p.a., after costs, and shares it between 50 workers equally, then they all get £20k each. But if they decide to ‘award’ the 4 managers with £100k salaries, then the remaining 46 only get £13k each. The mean wage in each is the same, so in any analysis we should examine the distribution, not just the minimum, maximum and means.

Thus, on the one hand the government can tell its domestic audience that we’ve never had it so good, and that we’re paid really well. This was Edwina Currie’s line. But when its audience is overseas investment, a different story is told:

‘The UK has a competitive salary structure in the service sector [i.e. cheap], particularly when compared to countries such as Germany, Ireland,Spain, Sweden and Switzerland… hourly compensation costs for production workers in the UK are also lower than in many other countries…’ (UK Invest)

The same document also shows that the UK has the reputation of the most flexible labour market [i.e. best for business, not workers], except for China:

UK has most flexible labour market

But internally, businesses give the impression of being hampered by red tape, unions with too much power, and the minimum wage. The CBI originally said the minimum wage would reduce the number of jobs, then each time there’s due to be a raise they say the same thing.

Perhaps at GDP per head, the UK is doing well, but we also have the most unequal wage structure outside the US, so people can still be badly paid here.

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On Monday, Andrew Gilligan’s Dispatches created a scare story about an ‘extremist’ Islamist group (Islamic Forum Europe: to be fair, they are Islamist but hardly extremist) infiltrating local politics in East London. This comes close to some of my work on ‘extremists’ in local politics, and the idea of ‘entryism’ just made me laugh… it’s what I call a minor conspiracy theory, that easily elides into the grand conspiracy theories of global organiations and elites who secretly control everything.

‘Entryism’ suggests a group of IFE people meeting, and secretly deciding to join a particular party en mass without revealing their prior affiliation. They hope to get enough numbers to steer the organisation in the way that they (who are stereotyped as being all of one mind) think will achieve the goals of their ‘actual’ organisation.

The reality, as far as I have found in my research, is much less conspiratorial.

First, ‘extremist’ activists are the same as everyone else involved in community stuff. They are the ‘do-ers’, who join a number of groups. In my research Islamist and far-right activists want to do good in society, and see their ideology / worldview as contributing to the good society. But their work isn’t limited to their specific ideology… they might be involved in charity work, residents’ groups, local consultation bodies, a religious group. Just like a Labour party person might be involved in their local church or community group. If members of the CofE join the Conservatives is this entryism? Given that involvement in community organisations is highly correlated with other involvement, we should expect this. It seems natural that when someone finds that having their say in a community group doesn’t achieve change, they then get involved in formal politics.

Second, they don’t come as a bloc: the activists do not all think alike in ‘extremist’ groups or any other for that matter. Groups as diverse as the BNP, IFE, Islam4UK, the Catholic Church, Labour, are attributed with a collective ideology, but ‘extremists’ suggests that this collective ideology is unbending and the only thing the activists think about. But, ‘extremists’ disagree just like those in Labour or the Conservatives. Some in IFE might see the local Labour group as a good way of gaining influence, others might detest the idea of joining a party which took us in to the war on terror. A conspiracy theory would have IFE members joining Labour, despite their reservations, on the orders of some IFE grand plan. I’m more inclined to believe in individuals, making little decisions that collectively make democracy work.

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Medical mistakes

Here’s another question of an order of magnitude… Daniel Ubani, a German ‘stand-in doctor’ who was over in the UK doing a shift as an on-call GP and gave a patient a fatal overdose of diamorphine (Guardian again). He gave the patient 10 times the amount – at first I wondered if he’d got millilitres and centilitres mixed up. However, you can now read the inquest material and it makes for interesting reading.

It seems that the mistake came when David Gray’s partner mentioned 100mg and 10mg, pethidine and diamorphine, in the same conversation. Having no pethidine, Ubani chose the diamorphine. Hearing 100mg, he chose the bigger vial. As diamorphine isn’t used in Germany he wouldn’t know the correct dose: he didn’t look at the instructions kept with the drugs, hence ‘manslaughter by gross negligence’. However, the death could have been prevented by proper induction. It seems that no-one showed Ubani round his equipment: he should have known that the 100mg vial was for palliative care and used in slow release with a syringe driver, as opposed to all at once.

At the inquest there was a some discussion about Ubani’s proficiency in understanding English. However, one of his employers said that his English was OK, and it seems unlikely that this was a huge factor. His unfamiliarity with NHS kit and procedures was more to blame. However, the papers seem to have decided that the black African with a German passport was an example of non-English speaking foreigners making a mess of things (see the Mirror). There’s a lot of blame on the profit making agencies too.

But, as noted in the report, this has happened before, and the month before the deaths NHS Cambridgeshire were discussing changing the boxes of drugs to avoid this:

“In attempting to relieve patients in acute pain, doctors in two different situations erroneously selected the 30mg diamorphine vial…and administrated the entire contents to their patients by injection.

“This six-fold overdose caused respiratory depression and collapse; the patients had to be admitted to hospital for resuscitation. If this is repeated and the patient not rescued in time, death could result.” (C4)

I don’t know if these doctors were the stereotyped foreign doctor, unable to speak English, or not. The lack of media interest suggests not as I’m sure a scandal would be being promoted as I write.

Indeed, focusing on this rare occurence misses the wider issues in ‘patient safety’. If society is fixated on this one fatal mistake, then it can ignore the fact that in 2007 there were ‘as many as 860,000 errors or near misses involving medicines’ in the NHS (Guardian). I’m sure that not all these mistakes were down to foreign doctors, but are down to normal human error, the kind of error that can often be avoided with the right systems in place, good management and so on. Dull (and expensive but that’s another story).

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An order of magnitude

We know many people are bad at maths. However, most mistakes are easily spotted through experience and common sense. But sometimes, common sense is lacking: here I’m talking about the Conservatives gaff on teenage pregnancy.

So first, the Conservatives. A few days ago they launched a document called Labour’s Two Nations, that was supposed to show how there is great inequality in Britain today (let’s ignore the fact that the rise in inequality happened in the 1980s). What they wanted to point out was that under-18 girls in the most deprived areas are three times more likely to become pregnant than in the least deprived areas (Guardian). It’s not clear what this means with regards to ‘most deprived’ and ‘areas’ – I think it’s top and bottom centiles and districts – and I’m sure I could find a more shocking figure if I chose a harsher definition of most and least deprived. The mistake they did make, though, was to divide 54 by 1000 and come up with 54% not 5.4%. That’s if they did a calculation: some social statistics come as ‘per 1000’ or ‘per 10,000’ and it’s important to notice this.

This matters for two reasons. First, because 54% v 18% is a big difference and much more significant than a difference between 5.4% and 1.8% (significant thought this is). Second, because anyone with any sense would realise that 54%, that is over half, is completely absurd.  Anywhere with 54% of its teenagers pregnant would have babies everywhere. Either the writer and editor just missed this, or they genuinely believed that there could be such a place and they are massively out of touch with normal life.

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