The smoking gun

We have become so accustomed to reading of children being knifed for their mobile telephones, men robbed and then gratuitously stabbed to death, and grannies beaten over the head for a few pence, that we are no longer surprised by it. But if you have a memory as long as mine, you will know how alarmingly we have descended. Source

So writes Bill Deedes, about crime in the UK. Looking at a broad indicator of crime, the number of indictable offences per thousand population in 1900 in England and Wales was 2.4 and in 1997 the figure was 89.1. Over the same period the population has increased by 63 per cent – far less than the increase in number of crimes. Even so, taking homicides (which in England and Wales include murder, manslaughter, and infanticide) the number per million population more than doubled from the early 1960s to 1997.

We can assume that the statistics are unequivocal and that crime has risen sharply in the past few decades. But can we blame government for the increase? Poor government performance may have had little to do with this. Indeed, government may have performed superbly, given the many diverse factors that contribute to lawlessness. As well, there is the question of how much weight we should attach to crime, compared to other areas in which similarly broad indicators show unequivocal improvements. For example: from 1901 to 1999 the life expectancy of new born children rose from 45 years for boys and 49 years for girls, to 75 years and 80 years respectively. Similar improvements can be seen for most of the measurable indicators of housing and education. In these areas, as in crime, government has played a large role.

The point is that a worsening of even quite broad indicators, even when government is spending increasing sums aimed at improving them, does not in itself prove poor government performance. There are simply too many other variables involved.

So what does constitute conclusive evidence that governments are inefficient? In two words: perverse subsidies. These can be defined as subsidies that are economically inefficient and environmentally destructive. In most cases they are also socially inequitable. They include policies that subsidise environmentally-intensive sectors or sub-sectors such energy, mining, fishing, forestry, transport, construction and intensive farming and agribusiness. They amount to hundreds of billions of dollars a year.

Perverse subsidies are nothing new, and neither is knowledge about their perversity. The abuse of resources that is the European Union’s Common Agricultural Policy has been known about, and quantified, for decades. Its environmental depredations and the burdens it imposes on developing countries have been estimated and documented for almost as long. Their size and persistence are all that is really required to show that government does indeed squander our resources, and they cast a shadow over all government programmes where the evidence appears at first sight more equivocal.