Category: Trade

Disruption and the Gods

Always the most impressive artifacts to come out of archaeological digs are those made of gold. It’s an element that comes down through the millennium unhindered by the turbulence of the daily News. It’s been a repository of wealth for as long as we have walked the Earth. That might be a brave statement. Let’s say people have admired and desired gold for that long.

A strange hold over people. In the last couple of years, the chart of the gold price has resembled that of rocket taking off. If you thought house prices have shot up a lot in the last decade have a quick look at the gold price. From 1978 to 2008 the curve looks relatively flat. Once past that date renowned for the financial crisis then the value of gold goes mostly one way.

Is this good or bad? One might even say – who cares. Well, geopolitics, inflation and monetary policy all play their part. I’m not talking about a precise indicator of these factors, but the linkage is clear. Many people see gold as a hedge against the declining value of other assets.

Geopolitics is a nebulous term. It can mean a million and one things. I guess on the one side of the coin is stability and on the other is instability. To relate the rapid rise of the value of gold to anything it may as well be the growth in the influence of disruptive forces.

Disruption has become incredibly fashionable in the last few years.

It’s like a newfound management trend. Although it’s not. Once upon a time, everyone was supposed to be rational, to create a harmonious world in which we could prosper. Management gurus who said as much thrived. Classical theories flourished[1].

However, they did warn us that institutions and organisations would change dramatically, in time. And that’s the component that disruptors have latched on to. Impatient to change in a softly-softly manner, the current mode is more along the lines of – to hell with it, do it now, come hell or high water. Don’t bother me with any of that risk assessment stuff.

I think, the downside of this pursuit of disruption is instability, insecurity and a latent fragility. Yes, it’s hidden. When a powerful disrupter succeeds the surface reaction is a round of applause. Under the surface the lack of long-term thinking invites an avalanche of negative repercussions. If the current gold price is a crude indicator, then there are potentially a lot of nasties just over the horizon.

An example to consider is the radical move to privatise the water industry in the UK. You bet that was disruptive. A politically fashionable move at the time. Surely a commercial mindset would serve the consumer, improve efficiency and increase investment. Ho Ho.

In the management of change, disruption has its place. If it’s the only card that a leader holds, and couple that with impatience, and outcomes are not going to be good. If they are good then it’s sheer luck.

[1] https://www.waterstones.com/book/gods-of-management/charles-b-handy/9781788165624

North Atlantic Airspace and Trade

Back to Greenland. A cold, cold land of mountains, snow, and ice. Next door to Iceland. I agree, the naming of places doesn’t make a lot of sense. Perhaps Greenland should be Iceland. And Iceland should be Fireland. Just under the Earth’s crust molten rock sits. It waits for the opportunity to come to the surface.

Iceland is highly volcanic. A land that’s growing and ripping itself apart at the same time. It sits on the Mid Atlantic Ridge[1]. The North American and Eurasian plates are moving away along the line of the Mid Atlantic Ridge. This is global geography. Not economic or social geography but the physical stuff. Ironically, considering the News, the North American plate is moving westward, and the Eurasian plate is moving eastward. Don’t worry this movement is slow.

When flying it’s usually faster to travel East than it is to travel West. A fast-moving band of air known as the jet stream[2] whizzes across the Atlantic. It represents that boundary between the cold polar air and the warmer southern air. The airspace of the North Atlantic (NAT)[3], which links two great continents is busy. There are seven Oceanic Control Areas (OCAs). US, Canada, Norway, Greenland (Denmark), Iceland, Ireland, and The Azores (Portugal) all have a role to play.

Back in the mid-1990s, I worked on Reduced Vertical Separation Minimum (RVSM). Looking at aircraft altimetry to determine what accuracy requirements would permit a change in separation standards. These standards, and the manual that goes with them are the responsibility of the ICAO European and North Atlantic Office in Paris. Yes, that’s Paris, France.

Given the arguments put forward by US President Trump, and his supporters, it does seem surprising that only Greenland is of interest. In aviation what happens across the North Atlantic, all the way up to the North Pole, depends on seven sovereign countries working together.

I’d say if there’s reason to be suspicious or concerned about one of them in terms of their capability, security measures, or vulnerability, what about the rest?

Whether goods or travellers go by air or by sea, across the Northern Atlantic, the success of their journey depends on communication, collaboration, and cooperation between sovereign countries. Without conflict of a major kind, it would be difficult for one country to take over that space.

I also did work on guidance material for Polar Navigation[4]. In the polar region, magnetic heading is unreliable or useless for aircraft navigation. Thus, it’s important to have other suitable accurate sources of navigation to be able to plan a flight over the top of the Earth. Aircraft communication is an issue too.

Russian airspace may be closed but this does not stop airlines flying over the pole. Finnair goes to Japan over the North pole[5]. Meticulous planning is needed to make theses flights safe.

Anyway, my point is that much of the commotion over Greenland’s fate tends to ignore the complexities of international trade and travel. At all stages international standards, communication, collaboration, and cooperation are essential regardless of who you are.

[1] https://www.geolsoc.org.uk/Plate-Tectonics/Chap3-Plate-Margins/Divergent/Mid-Atlantic-Ridge.html

[2] https://weather.metoffice.gov.uk/learn-about/weather/types-of-weather/wind/what-is-the-jet-stream

[3] https://skybrary.aero/articles/north-atlantic-operations-airspace

[4] https://www.faa.gov/sites/faa.gov/files/2022-11/Polar_Route_Operations.pdf

[5] https://www.finnair.com/gb-en/bluewings/world-of-finnair/flying-over-the-north-pole–well-planned-is-half-done–2557656

Reflections: Decade Since Brexit

Ten years ago, the world was a different place. “The past is a foreign country”. That bit is true. I still had an apartment is Cologne. Although, that phase of my life was coming to an end. The first two months of 2016 were about wrapping up the loose ends. Deregistering, as is the way when leaving German. Coming to a settlement with my landlord. Packing up and moving back to the UK. Saying goodbye to my regular haunts. Saying goodbye to a wonderful city.

Being an astute watcher of the UK political landscape, I could see that a vail of discontent was hovering over my homeland. There was a frustration amongst those in government. Can this endless debate about the UK’s place in Europe be resolved? Can it be knocked on the head once and for all?

The UK Prime Minister (PM), David Cameron was sitting on a small majority after the General Election of 2015. Conservatives were nervous but wanting to retake the agenda by trying to put to bed the Europe question. As it turns out Cameron made a grave mistake. He entertained the notion of a national referendum to advise the government on what to do next. An act that was uncommon to the UK’s normal way of doing business.

Probably one of the most foolish political acts a UK PM has taken in a very long time. Naturally, in 2016 few had an idea of the chaos that would be unleashed by this attempt at quelling internal Conservative Party wranglings. It’s true that these wranglings were not new. Just perpetual or should I say perennial.

My return to the UK wasn’t a celebration of the achievements we had made in Europe. That collectively we were in a much better place than before. That we had build something to be proud of. No, it was more of a submersion into an angry and emotional row. A heated row littered with misinformation and just simple run of the mill nonsense.

As I write this it’s plainly evident that the experiment, that was Brexit, damaged the country. Not only that but it resolved nothing. Instead of settling an issue it stirred up animosities and tribal conflicts. Today’s soap opera on the right-wing of UK politics is evidence enough of unresolved rivalries and ideological divides. An insular mindset and unresolvable differences.

In January 2016, there was no practical plan to leave the European Union (EU). It was almost unthinkable. Surely sensibility would prevail. That’s the political trap that Cameron fell into. Dare I say an almighty display of his cultured public-school arrogance. Convinced that if arguments were put to the public authoritatively, logically and rationally a remain result would be a simple foregone conclusion. That the political risks were manageable. That’s how wrong a man in power can be.

Moving on a decade. Yes, it is that long. Lots of water under the bridge. To the idiots on stage now, I say: the UK is not broken. It surely isn’t in as good a place as it could be. Had Brexit not taken place then we’d all be much more prosperous. We would be contenting with continuity. That includes squabbling right-wingers, but the fact is that they will never ever desist.

What’s sad is that the opinion polls say that a significant number of people want more of the same. More nonsense from the people who brought us Brexit in the first place. More from those doomsters and has-beens who complain without any realistic ideas of how to solve problems. A karnival of conmen.

Now, in the UK we have two right leaning political parties that are almost the same. One being the Conservatives and the other Reform. Each trying to outdo each other to attract the same voters. Stirring up discontent wherever they can find it. Projecting a negative image of the country whenever they speak. Feuding in a way that should convince people that neither is fit to govern.

POST: These folk explain it all in clay. Claysplained (@claysplained) • Instagram photos and videos

What to Expect

What’s going to happen in 2026? Predictions are always more a matter for the ancient Greek Gods than mere mortals but here goes. For the world of civil aviation:

Global air traffic will continue to grow,

Large hub airports will continue to expand,

Commercial air travel safety improvement will stagnate,

Electric air taxis will become a reality,

Pontification about the next generation of single aisle aircraft will continue,

Impacts of climate change will increase,

Blows to climate action will be slowly reversed,

AI breakthroughs will continue but adoption will slow,

Drone technology will advance at pace,

More airspace will be subject to conflict warnings,

Volatility and instability will plague the commercial manufacturing sector,

Regulatory harmonisation will struggle to advance,

And for certain, the United States will formally mark its 250th birthday.

Some pluses and some minuses. It will not be a dull year.

Globally the future of civil aviation is a healthy one. Propensity to travel is deeply ingrained in our ideas of development and growth. The complexities of adopting innovations are not new to the aviation industry. What may be new is finding a workforce that is as captivated by aviation as past generations. To train, induct them and offer them the attractive careers paths that compete with other fields. Anticipation of potential technology transformations often lacks a vision for the people who will make them possible.

Evolution of

Looking at the weird and wonderful picture of an unlikely lump of materials with wires hanging off, it’s easy to dismiss. A laboratory experiment that drew together theory and practice to produce a brand-new electrical device. Not something that occurred in nature. Even though its behaviour is of that of materials in nature.

Certainly, the implications of this experiment could not have been fully understood at the time. That said, progress to industrialise this new device was rapid. By the time of 1956, the “inventors” were awarded a Nobel Prize in Physics. In 1947, the transistor, was a fruitful combination of science and practical thinking in a laboratory where that was encouraged.

Bell Laboratories, given its history was a logical place for arguably the most important modern invention to be first put together. Arguing over “most important” there are several matters to consider. For one, how universal, how ubiquitous would this humble device become? Would it have a dramatic impact of everyday life for decades after its invention? Would it change every aspect of human organisation? Would its design, development and production become essential to the world? The simple answer – yes.

My first encounter with the germanium transistor was as a boy in the 1970s. Stripping them out of junked radios and record player amplifiers. Building simple circuits. PNP germanium junction transistors were tiny tin cans with three colour coded leads. With a soldering iron and a primitive breadboard there were plenty of designs in popular magazines to copy. Now, this is considered as vintage technology since germanium has long given way to silicon.

The clock, the radio, the bathroom scales, my shaver, my toothbrush, even in my bathroom every appliance contains circuits that are transistor based. It would be possible to live without some of these items, or at least substitute them with the mechanical versions, but that’s only for eccentrics, museums and heritage houses.

In 1947, the prototype transistor was on a bench being studied. It came along too late to play a part in the huge leap forward technology made during World War II. What became apparent is that the technology that had been developed using thermionic valves was convertible into a transistor-based versions. Size shrank and performance improved dramatically.

What’s my message? It’s another way of looking at so called artificial intelligence. Technology doesn’t come out of the blue. It doesn’t plot new pathways in the first years of its invention. It often takes things we already do and speeds them up or makes them cheaper or makes them more lethal.

We create another stepping stone upon which further developments can take place. So, maybe there is a South Sea Bubble about to burst. Much of the frantic investment that has taken place assumes that artificial intelligence is of itself a wonder. Let’s say it isn’t. The wonder is what it will allow us to do. Much of that side of the coin is a massive unknown. Much as the three who invented the solid-state transistor could not have envisaged tens of millions of them stuffed inside every computer chip on the planet.

Vintage germanium components are sough after by specialists. Apparently, audio amplifiers sound better to those who are sensitive to certain musical tones. Artificial intelligence has a proliferation of applications. A lot are gimmicks. Some are extremely serious.

POST: It’s often the boring stuff that can best be improved rapidly, note: One real reason AI isn’t delivering: Meatbags in manglement • The Register

Political Intolerance

Although there’s a growing intolerance in the UK. That can be seen in the opinion poll ratings for the Reform Party. Voicing opinions that are likely to arouse conflict, and division has become a calling card. Done on a regular basis the media can’t resist covering every foghorn moment. This offers them a disproportionate coverage, as if the sky is falling every day.

Kinda funny that a European folk tale, with a moral twist, is the basis of a political strategy in 2025. “Chicken Licken” got hit on the head by an acorn and deduced that the world was about to end so he’d better tell everyone right away.

I started, although there’s a growing intolerance in the UK, and meant to lead on to deducing that I’d say that people in the UK are more tolerant than those in the US. Now, this isn’t the case. For from it, tolerance is being stretched to the limits in the US.

For all the bad Press the current UK Prime Minister (PM) gets, his language has been coherent, deliberate, and understandable. That is like most of his predecessors, except the one who was in office only as long as a lettuce remained fresh, namely perhaps Liz Truss. Starmer is a lawyer after all. Not a great orator. Certainly not a comedian.

If Labour’s leader Starmer stood on a public platform and exclaimed “nobody understands magnets” I’m sure he wouldn’t last longer in post than Liz Truss did. See how intolerant people are in the UK.

Humanity understands magnetism. That’s down to a couple of heroes on mine. Michael Faraday[1] and James Clerk Maxwell. By applying experimentation and mathematics they both mapped out how electromagnetism works. Much of the modern world depends on their discoveries. Electrical power is at the core of technical society.

If the PM were to redefine his government’s environmental policies and take against wind energy, I doubt that he’d say, “The windmills are driving the whales crazy, obviously.” It’s true that the UK has a lot of wind turbines in the North Sea and that there are whales who pass that way[2]. That sentence alone would have the members of the House of Commons rolling in the aisles. It would be difficult for supporters and opponents alike to remain calm in such a situation.

On both sides of the Atlantic there’s so much debate and discussion about artificial intelligence that it’s impossible to get away from it. Yes, there must be a few ostriches, with their heads in the sand, who when asked wouldn’t know of the existence of AI. Can’t be many though.

So far, the PM hasn’t resorted to saying “Around the globe everyone is talking about artificial intelligence. I find that too artificial, I can’t stand it. I don’t even like the name.” Naturally, I stand to be corrected because there may come a time at Prime Minister’s Question Time that the subject of dropping the word “artificial” comes up. It’s hasn’t yet. If this subject became part of the ding done exchange at the dispatch box in parliament there is one thing for sure. Everyone would know that it would be time for a new PM.

Will Starmer survive 2026. My prediction is that he will survive in post but that will not stop arguments about his future. Overall, here my conclusion is that people in the US are far more tolerant than those in the UK.

[1] https://www.mritannica.com/biography/Michael-Faraday

[2] https://www.wildlifetrusts.org/wildlife-explorer/marine/marine-mammals-and-sea-turtles/minke-whale

Rethinking Taxation Strategies

The whole subject of land value tax is not one to get into if you are looking for something to read while waiting for a bus or looking for a light-hearted story. Yes, that could be said about any discussion about taxation. Probably one of the reasons why so few people engage in conversations about the nitty gritty of this subject.

LVT (Land Value Tax) is not new. This idea has been on the block for decades. One of the underlying reasons for its popularity is that instead of taxing things society likes, like business, commerce and employment, this tax scheme aims at an asset value. In a country where land is a valuable commodity, at least in populated areas, here’s a tax base that this solid.

The part LVT could play in UK tax reform is a major one. That’s where this subject gets twisty. How to get from where we are now to a new scheme that is understandable, straightforward, and acknowledged as fair. That is, at least in comparison with the existing taxation schemes.

One provision needed is to distinguish between public land to private land. There’s no point in raising revenue to fund local government and then getting that entity to use those funds pay the same tax. If private organisations lease public land, then there would need to be a provision too.

Then there’s the difficult issue of revaluations of private land such that the result is fair and genuinely reflects “value”. A city car park and a golf course are very different in that respect. Fine there is a national land registry, although there are still packets of land unregistered.

Quite a bureaucratic set-up establishing a Valuation Agency. Even if most of the necessary information is already held by lots of existing organisations. Every set of accounts is going to have value for assets held or owned. The range of accuracy of these values can be wide.

I’m not making a case against LVT. What I am saying is that tax reform is not easy. Those proposing it must have a long-term perspective. Must be committed to getting away from making ever more complicated fragmentary changes to legacy schemes. Adding ever more complexity to an unreadable tax code.  

Tax reform is not easy. Facing up to those who gain an advantage from the status-quo is often one of the greatest pressures that a government faces. Making life simpler and less burdensome for small businesses, shops, pubs and restaurants is a great ambition. Facing up to the owners of golf courses and sprawling country estates, now that’s not so easy.

Now, when I wonder what the New Year will bring it doesn’t seem that the current government is not brave enough to make radical changes. Their approach, over the last year, has been one of cautious incremental tinkering. If they have core principle, no one is quite sure what they are.

Lessons from Nature

I once said to Kwasi Kwarteng[1] that peak Boris Johnson passed during the early part of his terms as London mayor. Naturally, predicably he didn’t agree with me. This was in the Parliamentary constituency of Runnymede and Weybridge in 2017. I was the Liberal Democrat candidate standing against former Conservative Minister Philip Hammond. The public event we were attending was in Egham in Surrey.

Wow. A hell lot of water has passed under the bridge since that time. It’s like looking back at medieval history and trying to find a thread that links with the here and now. Governments have been and gone, careers have flourished and collapsed, Trump has been and gone and then returned and as was predicted Brexit has turned out to be a disaster.

Here’s a thought. It has always astonished me that we have a common fallacy. If a shelf regarding person who makes a lot of noise was once, even for a fleeting time, good at one job, they will be good at a loosely similar job. What a load of nonsense. So, it has turned out to be.

I’ve been watching the BBC’s series Kingdom[2]. About the animal kingdom. I know that the filming of such a spectacular series takes an enormous amount of dedication and effort. We get the pleasure of watching a well edited set of stories about leopards, hyena, wild dogs, and lions.

It’s tough out there to survive the seasons in the imposing Zambian landscape. We get to see the shifting of power between animal families and from generation to generation. It’s raw nature doing what it does and what it has been doing since the dawn of time. In what appears a paradise, nature is cruel. Rivals quickly exploit weakness. It’s going a bit far to draw a direct link between the rivals in the wild and the rivals in our parliamentary democracy. That said, there are lessons nature can teach us.

One is that top dogs don’t stay top dogs forever. They get their moment in the sun and then it passes. The fight to make a claim on a territory is perpetual. Yes, the cycles of the season have their impact and luck, good or bad, plays its part.

Two, is that a bad move remains a bad move. Ignoring crocodiles is never a good move. Wandering about without the protection of the pack is a high-risk strategy. Backing off, and fighting another day, is the best way to deal with a bigger, meaner, and hungrier opponent.

Where am I going with talk of these two different worlds? Human nature and animal nature.

It’s my reaction to seeing the scribblings of a former Prime Minister wibbling on about how dangerous it would be to reverse Brexit. Boris Johnson, that man whose star faded a long time ago, is writing for tabloid newspapers. He’s writing exactly what anyone would expect to see from those who will not learn from experience.

A bad move remains a bad move. Now, nearly ten years on, a bad decision remains a bad decision. Write what you like, it’s impossible to transform a failed project into a kind of utopia. What’s worse is to try and scare people by writing that we must tolerate failure because we once adopted a failed project is ludicrous. It’s irresponsible. It’s mad.

[1] UK Chancellor of the Exchequer from September to October 2022 under PM Liz Truss.

[2] https://www.bbc.co.uk/programmes/m002hdgh

A New Customs Union

Let’s not put up taxes. Let’s trade more. Seem obvious. Well not in late 2025 in Britain. This possibility must be forcefully put on the agenda for debate in parliament. Raise revenue, rather than raising new taxes, has got to be the better way to go. The bigger the pot the more chance that a government has got to balance the books. Taxes have their place but not to be the default opinion, in all cases.

The Labour Party has been talking the talk on growth in the economy but frequently marching in the opposite direction. It’s as if they embrace the comfort blanket of domestic tax increases too readily without thinking of the long-term impact. Habits are hard to change.

Before, what a majority agree was a mistake, Brexit, trade with our next-door neighbours was in a much healthier position than it is now. We’ve (UK) created barriers and obstacles that have diminished our trading position to no advantage whatsoever. Coming up for a decade of backward thinking.

In parliament, the Liberal Democrats are tabling a bill that calls for creating new Customs Union (CU) with the European Union (EU).

What is a CU? Simply put, it’s a trade agreement between countries to abolish tariffs on the goods they trade with each other. So, instead of barriers and obstacles to trade, the whole process becomes easier and cheaper.

Yes, such an agreement with the EU would have implications for relations with non-EU countries. What I’d say in that respect is that such negotiations with non-EU countries on tariffs haven’t been going so well in the last year. The UK has been buffeted by the policy of other nations, where their policy often spins on a dime. On / off fragile agreements don’t add enduring value.

Such a new CU with our next-door neighbours would boost the UK’s GDP by a significant amount. A boost of £25bn a year for the public finances is predicted. Thus, the growing demands that drive for domestic tax increases would be abated or at least be affordable.

Do you remember? So, many advocates of Brexit said we’d never leave the CU. It’s easily forgotten but some of the most ardent Brexit supports were saying this to the electorate. In essence being untruthful.

Back in January 2017, the Conservative Prime Minister (PM) of the time confirmed that the UK would not remain in the EU CU. What a massive mistake PM May made. The repercussions have been devastating for businesses and the public up and down the UK. It was an act of disfigurement that damaged our economy for nothing more than political dogma.

Sadly, we are where we are. I wouldn’t start from here. Wouldn’t it be great if negotiations started to take the UK into a new CU with our nearest, biggest trading neighbours and partners.

Sadly, the way the parliamentary vote will go is rather predicable. The Labour Party, in its current form, is not the internationalist Labour Party of its history and traditions. Currently, government support is not forthcoming. They prefer to talk the talk without walking the walk.

Post: Fix Britain’s Trade – Liberal Democrats

UK’s Digital Dependency

Under the title of “Culture” The Guardian newspaper offered an article that caught my eye this weekend. The author, Tim Wu was offering a point of view about the economic landscape that we inhabit in Britain. The theme was the drift that has taken place whereby we find that a huge dependency has grown-up over the last couple of decades. That is the unassailable dominance of a small number of US companies throughout the whole of our country.

What am I using to write this remark? It’s a computer program called “Word” sold to me by a multinational company called “Microsoft.” What’s strange is that this way of expressing my relationship with Microsoft isn’t commonplace. There’s a tendance to treat software, like Word as if it has always been with us and always will be. Like the public roads I drive my car on. Completely taken for granted. That is until a problem arises.

This Saturday article wasn’t about computer software per-se. Although the world of computing is riddled with intellectual property rights there remains a kind of openness to new ways of doing business. Digital ones and noughts are like the text on this page. They can be rearranged in all manner of diverse ways. The combinations and permutations are almost infinite.

Tim Wu argues that we should look to the way transport systems developed as an analogy to the electronic communications infrastructure we use.

Roads developed in the era of the horse. More than 200-years ago, before the time of the railroad. In fact, they go back a lot longer than a few hundred years ago. The Romans were particularly good road builders. However, that was a state enterprise aimed at getting armies around a sprawling empire.

The condition of roads in Britain took a leap forward when commercial enterprise found a way of getting an income from the primary land transport system of the day. Road tolls were a way of building and maintaining a network of highways. This network was physical. Fixed in place.

Digital infrastructure is more than cables, wireless systems, and databanks. Without the human interface all that extensive structure is unusable. That’s were a small number of US companies dominate the marketplace. This complete extra territorial dominance is, like my comment about Word above, taken for granted.

Tim Wu’s analogy doesn’t cut the mustard. It does illuminate an inconvenient truth. The reason the big US companies are driving the future of communication and technology is because they have captured a massive global income stream. However, much of that position depends on the laws that prevail in each nation. That prevail at a time when globalisation was seen as almost unquestionable. Now, the question arises has national sovereignty been sacrificed on the alter of progress? If so, what next?

There’s often been a hard kick-back against anticompetitive behaviour. Monopolies are not considered the best way to serve the public interest. Nevertheless, throughout history they have been pivotal in our story. Like it or not, that’s how the elegant country houses and castles of Britain were paid for and furnished. The same experience can be witnessed at the Newport Mansions[1] in the US.

How do we democratise rapidly advancing technology? There’s a mighty big question.

[1] https://www.newportmansions.org/