Who's in charge?

Europe’s dairymen are so obsessed by the need for regulation that the worst economic slump in more than 70 years barely enters their consciousness.The European Commission will spend €600m this year on export subsidies and buying unwanted dairy goods which will then moulder in cold storage (the EU is not recreating mountains, insists one Eurocrat, “more a butter hillock”). Economist, 6 August

Who are these people, channeling your savings and the next generation's income into subsidised overproduction of butter? Who makes these decisions? It's been known for at least thirty years that these subsidies do very little except bolster the market value of farmland and transfer funds from ordinary people to the very rich. As with the bonuses for cynical bankers, our political system seems incapable of behaving rationally.

The truth is that, without any guiding principle other than expediency, our politicians are lost. There's no relationship between the policies they enact and the outcomes the people they represent want to see. Society, economics, the law; they and the way the interact are far, far too complex for anyone fully to understand. So short-term considerations are king.

A Social Policy Bond regime would be different. It would subordinate all activity to targeted outcomes. There can't be many who'd want to see the corrupt, insane systems of agricultural support of the west, which apart from enriching aristocrats are environmental and economic disastrous. People or governments would instead concentrate on defining the outcomes that we do actually want to see, and let the market decide how best to achieve them.