Turning up the heat on housing, economic growth and rice Top of the Charts 27 January 2023 Torsten Bell Afternoon all, All the best people are having their away days right now – looking forward to ours on Monday. On the downside, we don’t get to head to Chequers or any other country estate for it. But then again none of us are going to have to resign pretty soon afterwards. So that’s a plus. Don’t worry if you’re not imminently heading off for a mix of awkward team building and motivational speakers, because TOTCs offers the bad gags and promise of self-improvement that underpin any good away day, without the risk that comes to any Brit from extended social interactions. And what away day is going to cover the dangers of rice farming, the future of Blyth and the popularity of warm homes? Only a very very good one, let me tell you. Have a great weekend whether it’s home or away. Torsten Chief Executive Resolution Foundation Rubbish rice. I’ve a big problem: my wife’s constant preference for rice over bread/pasta that undermines our (obviously otherwise undistributed) domestic harmony. So I adore a new paper showing that rice – okay, rice farming – makes countries… miserable. Here’s the puzzle: as countries get richer they get happier, but East Asia has lower life satisfaction than it should given its wealth. That’s odd because these countries have high degrees of social interdependence (vs the atomised west), which generally boosts happiness. So what’s going on? Well high interdependence brings intense social comparisons (which make us miserable overall, even if the rich get a small smugness boost). Which is where the rice comes in. The authors show that within China the rice farming south has higher interdependence (because rice farming involves more pooling of labour than is needed in the wheat farming north), lower average happiness, and life satisfaction more tightly related to relative income (consistent with social comparisons being the problem). So, grains shape nations’ happiness as well as their health. Happy Hunt. The Chancellor had his big economic speech this morning telling the Tory right to calm down on tax cuts and Labour to perk up on Britain (despite the speech in many ways being something Rachel Reeves could have delivered, being pro-devolution, fiscal discipline, net zero etc). His basic pitch is Rishi Sunak’s (with a bit less of a west coast VC tech bro vibe) ie Britain is quite good at innovation and there are important/growing sectors that we can lead on (life sciences, digital, green etc). The Chancellor promises to unleash this potential via four Es. Which I’m assured aren’t pills but: Enterprise, Education, Employment (a March Budget focused on reducing inactivity) and Everywhere (promising “fiscal devolution”). The gaps? Nothing much here for those working in the big employing/lower paying sectors of our economy, and the urgency for action is slightly underdone by the claim we haven’t seen much decline over the past 15 years. We really have. Political pressure. We’re all quite keen on the judiciary (and the tax authority…) being independent from political power. It’s part of this whole liberal democracy thing. But even if that’s formally the case, are legal decisions influenced by politics? Fraid so, concludes research that finds judges in Brazil are 65 per cent less likely to convict politicians who have won elections of misconduct. Among those accused of misconduct, those just losing a mayoral election get convicted 17 percent of the time vs 6 per cent for those winning (informal or indirect influences overcome laws generally preventing politicians having formal influence over judges). Just another reason politicians should want to win elections… Insulation impact. Insulate our homes to get our energy consumption (and bills) down is the battle cry of the loft lagger. But a recent report flagged up by Evan Davis on Tuesday’s PM program (23 minutes in) pours at least half a glass of cold water on some of the claims for what home insulation achieves. Yes, insulating a loft reduces a household’s gas consumption immediately. But the effect doesn’t last, with energy use then rising back to around it’s previous levels over a few years. This is especially true in poorer areas. Now before the climate loons out there say this means home insulation is worthless note that this is the wrong take. Instead, what this shows is that many households choose to take the benefit of a better insulated home in greater warmth rather than just lower bills. It’s almost as if we value comfort. Who knew. Bettering Blyth. Levelling up gets a lot more concrete once you focus on specific places. The embarrassing collapse of Britishvolt has got everyone talking about Blyth – it’s proposed base for a Gigafactory in Northumberland. Most of what I’ve read has been nonsense, often just implying government should have chucked more cash into a failing firm. But there’s food for thought in Paul Swinney’s blog which rightly notes that while Blyth is a poor town, there are similar sized better off towns nearby (e.g Morpeth). What marks them out? Being home to higher income commuters to Newcastle. The unsubtle message (maybe the unsurprising one from the Centre for Cities) is that ensuring Newcastle’s success in creating many more high-skilled jobs is central to the future of Blyth – and lots of the rest of Northumberland. Chart of the Week There’s been lots of levelling up chat this week thanks to the Convention of the North up in Manchester, and the growth of discussions of place in economic/political debates is very good news. But one trend I’ve noticed is commentators talking about people from different parts of the UK almost as different species (which is odd – England is a tiny country). It’s common to assert people increasingly only feel attached to their own area, not the country as a whole (Grayson Perry did exactly this on the Today programme this Wednesday). But the data doesn’t support that, as COTW shows. People are increasingly more likely to worry about living conditions from a national than a local perspective – completely reversing their position two decades ago. I don’t know exactly why this is, but here are some inklings. First our stagnation has stuffed every region despite what people often claim about their being some big winners (over the past 15 years, annual median hourly pay growth has ranged from a whopping 0.4 per cent in Northern Ireland to -0.5 per cent in London). Second, people living through screens are often watching things nationally (or even internationally), rather than socialising locally. Obviously civic pride is a long way from dead (we REALLY care about our local high streets) but punters seem to recognise (more than politicians) that when it comes to tackling our economic malaise we really are all in it together.