Political parties of the left and right first reaction to almost any problem is that ‘something must be done’ by the state. The ‘socialists of all...

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It seems political parties of the left and right first reaction to almost any problem is that ‘something must be done’ by the state. The ‘socialists of all parties’, as F. A. Hayek put it in his 1944 The Road to Serfdom, have pursued an extraordinary expansion of the state’s role in recent decades – further accentuated by the policies made to address the Covid-19 pandemic.


The ‘something must be done’ mantra incorrectly assumes that policymakers have the knowledge and information to achieve the best outcomes. But state intervention often has unintended consequences, leading to demands for even more state action to fix new problems. Thus, the interventionist cycle continues.


J. Wiseman and A. Peacock identified this situation decades ago as the ‘displacement effect’ of public spending and taxes after a major event. Put simply, governments are more prone to intervene in times of trouble, and the population are more willing to welcome such intervention, leading to higher taxation and public spending.


Most recently, enlarged government spending and deficits – largely monetised by the Bank of England in 2020-21 – caused a surge in inflation. Now we are seeing calls for counterproductive policies to fix inflation, from caps on mortgage and rental payments to price controls on food, which would result in terrible shortages. The interventionist approach led to our current predicament and now policymakers are facing demands to pursue policies that will only create even more problems.


So, can the interventionist cycle be interrupted? Can liberalism be saved?


The Vinson Centre for the Public Understanding of Economics and Entrepreneurship (at the University of Buckingham) will be hosting its annual conference ([link removed]) in the Classical Political Economy tradition, where we will be exploring an alternative to the current rise in statism. We will cover ‘The perils of big government and market intervention: the revival of ‘the spirit of 1945’?’ (session 1), ‘Classical liberalism’ (session 2), and ‘Liberalism in retreat’ (session 3).


These panels include many individuals affiliated with the IEA:
* James Forder, IEA Academic and Research Director,
* Syed Kamall, IEA Academic Fellow
* Martin Ricketts, Chairman, IEA Academic Advisory Council
* Mark Pennington, Christian Bjørnskov, & Pedro Schwartz, IEA Academic Advisory Council Members


I look forward to seeing you there,

Dr Juan Castañeda

Director of the Vinson Centre for the Public Understanding of Economics and Entrepreneurship

(University of Buckingham)

Member, IEA Academic Advisory Council
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** The NHS Turns 75
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Is it still the ‘envy of the world’?

This week, the National Health Service turned 75, but much like ourselves, the older an institution gets, the more visible its flaws become. IEA research has highlighted deficiencies in the NHS model and discussed systemic healthcare reform to provide improved healthcare outcomes and provide greater consumer choice. This week was no different.
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IEA Head of Lifestyle Economics Christopher Snowdon appeared on BBC Radio Ulster ([link removed]) to participate in a panel discussion on the state of the NHS.

Commenting on the tragedies caused by the NHS’ poor healthcare outcomes, Christopher suggested:

"I don't want to burst anyone's bubble on this 75th anniversary, but we should also commemorate the lives of the many people who have died as a result of the NHS."
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On GB News ([link removed]) , Christopher discussed the NHS’ poor healthcare outcomes and argued that increasing disputes over pay are the product of a centralised, uncompetitive system.

Misaligned priorities…Christopher also wrote for The Critic ([link removed]) criticising Chief Executive of NHS England Amanda Pritchard’s recent misinformed comments about gambling addiction. With long waiting lists and doctors’ strikes putting lives at risk, one might think Pritchard has bigger fish to fry.
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Ripe for reform… IEA Head of Political Economy Kristian Niemietz was quoted in The Daily Mail ([link removed]) endorsing former Health Secretary Sajid Javid’s proposal that a Royal Commission be set up to examine the NHS’ future.
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To mark this week’s anniversary, Kristian headed down to St Thomas’ Hospital to film an explainer ([link removed]) on the history of the NHS and how it became the failed system it is today.
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Kristian has written extensively on healthcare reform, including his landmark book, ‘Universal Healthcare Without the NHS’ ([link removed]) .

IEA Latest.
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** The CMA is distorting the market ([link removed])
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Christopher Snowdon, Sky News ([link removed]) & The Spectator ([link removed])

CMA fueling chaos… The Competition and Markets Authority (CMA) has criticised supermarket profit margins in the fuel industry, but their claims don’t stack up. This is a highly competitive sector with complex dynamics.
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** Rishi’s five pledges lacked ambition ([link removed])
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Economics Fellow Julian Jessop, The Daily Express ([link removed])

Ambition deficit… Although the Prime Minister is likely to meet his five core pledges in areas such as inflation and economic growth, we should hold our applause, his promises were not nearly bold enough.
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** The nanny state risks destroying pubs
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Christopher Snowdon, quoted in The Times ([link removed]) , The Daily Telegraph ([link removed]) , The Independent ([link removed]) , The Sun ([link removed]) and The Daily Mail ([link removed]) .

Eyes on the road… The British Medical Association wants to tighten drink-driving rules so people can no longer get behind the wheel after one pint of beer or glass of wine. But such a move would not impact road deaths and risks further damage to Britain’s battered hospitality industry.
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** Nick Ephgrave must rectify SFO failures ([link removed])
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IEA research ([link removed]) quoted in The Times ([link removed])

Fraud focus… In January, the IEA published ‘Fraud Focus’ ([link removed]) , a research paper authored by IEA Academic and Research Fellow Dr James Forder, discussing the failures of the Serious Fraud Office.

This paper was quoted this week in an article in The Times ([link removed]) covering the challenges facing the new head of the SFO, Nick Ephgrave.
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** What can we learn from Adam Smith? ([link removed])
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Communications Officer Harrison Griffiths interviews

Dr Mark Skousen, IEA YouTube Channel ([link removed])

Happy Birthday... This year marks the 300th birthday of the great economist Adam Smith. But looking around, policymakers have forgotten his core messages.
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** England’s private utilities struggle to pass l’eau bar ([link removed])
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IEA Academic Advisory Council member Steve H. Hanke, Financial Times ([link removed])

To the highest bidder… The recent Thames Water fiasco has led many to question whether water should ever have been privatised. But privatisation was badly implemented, largely because policymakers failed to read the work of 19th Century thinker Sir Edwin Chadwick.
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** Fighting for Free Speech ([link removed])
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Head of Cultural Affairs Marc Glendening interviews Baroness Fox, IEA YouTube Channel ([link removed])

Free speech under attack... In both our private and public institutions, the right to free speech is increasingly under threat, but how should we lead the fight back?
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** Is 'Greedflation' Pushing Up Prices? ([link removed])
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Director of Public Policy and Communications Matthew Lesh interviews Christopher Snowdon, IEA YouTube Channel ([link removed])

The pursuit of profit... A new study by the Competition and Markets Authority claims that high supermarket profits are pushing up fuel prices. This comes amid widespread claims that profiteering is driving inflation. But is this all true?

IEA Insider.


** IEA Summer Media Party
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The IEA was delighted to host Britain’s leading journalists for the IEA’s Summer Media Party with special guest speakers The Rt Hon Tom Tugendhat MP MBE VR, Cabinet member and Minister of State for Security of the United Kingdom, and The Rt Hon David Davis MP.

There was a wide array of major outlets represented including The Telegraph, Sky News, Daily Express, GB News, The Times, Guido Fawkes, The Spectator, i News, TalkTV, and many more.

Tugendhat’s comments on freeing up pension fund investments were reported in The Telegraph and the Daily Express ([link removed]) .

“We have trillions of pounds in pensions. The problem is that it isn’t being used to fund businesses and invest in the future, generating jobs and wealth,” Tugendhat said.

Politico also reported on the party ([link removed]) :

“Tom Tugendhat opened his speech at the IEA’s bash by attacking the “draconian, anti-free market, some might even say unconservative new policy [that] hangs over Westminster … Elon Musk’s decision to start rationing tweets.”
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