Hopefully, the public will draw appropriate political lessons about public spending priorities from this news report in the Daily Wail:

“The predicted cost of the games when London won the bid in 2005 was £2.37billion. That figure has now spiralled to more than £12billion and could reach as much as £24billion, the Sky Sports investigation claims.”
http://www.dailymail.co.uk/news/article-2092077/London-2012-Olympics-cost-spiral-24bn–10-TIMES-higher-2005-estimate.html

Hmmnnn… not ALL of the British public apparently; support for Scottish independence actually seems to have been bolstered by the Olympics. another one in the eye for the misinformation spouted by the mainstream media it appears!

http://www.google.com/hostednews/ukpress/article/ALeqM5hSlc9Nvbs6EpSk9TiGqoU0YlHh7g?docId=N0419861344783863180A

For comparison:

“Yorkshire has finished up with seven gold medals, two silver and three bronzes, placing it twelfth in the medal table if regarded as an independent country, as it should be.”
http://www.guardian.co.uk/uk/the-northerner/2012/aug/13/yorkshire-olympic-medals-gold-tourism-leeds-york-dales-sheffield-hull?newsfeed=true

But then Yorkshire is somewhere near the bottom of the league table for the results of the school-leaving exams.

1

Like Wilde’s cynic, the economist also knows the price of everything and the value of nothing.

4: “Like Wilde’s cynic, the economist also knows the price of everything and the value of nothing.”

That’s rich seeing as how the London School of Economics (LSE) was founded by prominent socialists:

“LSE was founded in 1895. The decision to create the School was made by four Fabians at a breakfast party at Borough Farm, near Milford, Surrey, on 4 August 1894. The four were Beatrice and Sidney Webb, Graham Wallas and George Bernard Shaw.”
http://www.flickr.com/photos/lselibrary/sets/72157622618340936/

5

The LSE was founded by four Fabians not four economists, so I fail to see your point.

6: “The LSE was founded by four Fabians not four economists, so I fail to see your point.”

As with Heinz foods, we can note that there are at least 57 varieties of socialism, of which the Fabians are but one.

The Webbs were famously the authors of: Soviet Communism – A New Civilization (1936) while GB Shaw was the author of: The Intelligent Woman’s Guide to Socialism and Capitalism (1928).

With socialist minded colleagues – like HG Wells and Annie Besant, Keir Hardie, RH Tawney and GDH Cole – they evidently believed there was a gap among British institutions of higher education in the late 19th century to provide for the teaching of the economics disciplines required for running a socialist government, seeing as how Marx had signally failed to do so. You may recall that Laski, professor of politics at the LSE, was famously chairman of the Labour Party during part of the time of Attlee’s Labour government 1945-51. Relevant insights for the Olympics legacy can be gleaned from this recent contribution from within the LSE:

Humanity may split into two sub-species in 100,000 years’ time as predicted by HG Wells, an expert has said. Evolutionary theorist Oliver Curry of the London School of Economics expects a genetic upper class and a dim-witted underclass to emerge.
http://news.bbc.co.uk/1/hi/6057734.stm

As the London Olympics has shown, Marx was quite wrong about religion being the opium of the masses.

@ 7 Bob B

“Humanity may split into two sub-species in 100,000 years’ time as predicted by HG Wells, an expert has said. Evolutionary theorist Oliver Curry of the London School of Economics expects a genetic upper class and a dim-witted underclass to emerge.”

While I’ve occasionally speculated about the possible real-world emergence of Morlocks and Eloi, a glance at that article suggests that it’s based on the ancient discipline of Making Stuff Up As You Go Along.

Also, HG Wells didn’t predict it as far as I know. Portraying a fictional future is not the same as making predictions.

HG Wells, along with others, promoted the Eugenics cause.

“At its peak of popularity eugenics was supported by a wide variety of prominent people, including Winston Churchill, Margaret Sanger, Marie Stopes, HG Wells, Theodore Roosevelt, George Bernard Shaw, John Maynard Keynes, John Harvey Kellogg, Linus Pauling and Sidney Webb.”
http://en.wikipedia.org/wiki/Eugenics

All that I’m saying is that promoting compulsory team sports in primary schools, at the expense of basic skills in reading, writing and maths, is going to do no end of harm to the lifetime earning prospects of many.

A few stand to gain substantial personal wealth from elite sports but we must not be conned into believing that sports matter for more folk than being up to scratch by international standards in basic education skills. This was the worrying observation of the HoC Public Accounts Committee in 2006:

“Up to 12 million working UK adults have the literacy skills expected of a primary school child, the [HoC] Public Accounts Committee says. . . The report says there are up 12 million people holding down jobs with literacy skills and up to 16 million with numeracy skills at the level expected of children leaving primary school.” [BBC web site]

Also, HG Wells didn’t predict it as far as I know. Portraying a fictional future is not the same as making predictions.

Yes, its a satire rather than a prediction. Wells didn’t become a ‘prophet’ till much later, by which time his sf was a great deal less fun.

And you’ll note the Morlocks – decended from the working class – are the intelligent ones who keep the machines running, not the sheeplike Eloi. Wells himself had grown up ‘downstairs’.

7

Marx, of course, was writing about the conditions within the 19th century, just as Smiths’ works reflected late 18th century society, sure there are some universals which they both picked-up on. Marx was the one who related work and the economic base to the subjective feelings of the human within that environment, Smith looked at the mechanical workings of a market. And this is the model which most economists follow, hence the observation that ‘they know the price of everything and the value of nothing’.

There are several models of socialism with one universal thread running through, and that is the absence of private ownership of the means of production. Certainly a common thread within modern socialism is education (something which Marx would have upheld) and inferred when he wrote about ‘false consciousness’.

Shaw appears to have become disappointed with his brainchild, he famously noted that ‘If all economists were laid end to end they would not reach a conclusion’

“Smith looked at the mechanical workings of a market. And this is the model which most economists follow, hence the observation that ‘they know the price of everything and the value of nothing’. ”

We need to understand how markets function without sentimental fog and to be able to work out unwelcome contingent consequences. Economists – from Smith onwards – have provided much of the substantive criticism of how markets can malfunction: it’s just that Marxists choose to overlook that. I’ve previously posted links to where mainstream academic economics was on market failure 50 years ago: Francis Bator: The Anatomy of Market Failure
http://instruct1.cit.cornell.edu/courses/econ335/out/bator_qje.pdf

The literature has grown much since – try googling on: Akerlof on: The Market for Lemons, and John Sutton on: Market Structure Theory and Evidence.

Recent books: Robert Shiller on: Irrational Exuberance (Princeton UP); John Cassidy on: How Markets Fail (Penguin Books); Kenneth Rogoff and Carmen Reinhart: This Time Is Different – 800 years of failure (Princeton UP).

To claim that economists have been persistently blind to market failures is demonstrably untrue. The trouble that economists have is that many self-avowed rightists and leftists are uncomfortable with the unsentimental analysis of economists – hence all the juvenile jokes about economists disagreeing as though political activists, lawyers, medics, scientists etc never disagreed.

To return to the topic first raised of public expenditure, as we are in a time of austerity, might it not have been a good idea to have kept the Olympic Games costs down by concentrating upon the bare essentials and cancelling the fripperies such as the opening and closing theatricals, and putting the money saved into providing sports facilities for schools and local authorities? I think that this might have won considerable public approval across the political spectrum.

‘We need to understand how markets function without sentimental fog’.

Quite, that’s why the majority of the work of economists is attempting to explain why outcomes were not as expected, because like it or not, the ‘sentimental fog’ as you label it, is very much part of the human character.

Economics has to be the only discipline which purports to be a science and excludes some of the most important variables.

Steveb: “Economics has to be the only discipline which purports to be a science and excludes some of the most important variables.”

“Importance”, like beauty, is in the eye of the beholder. Mushy sentiment in the discussion of economic issues to divert attention from underlying fundamentals and unintended consequences isn’t in short supply. I’ve heard/read this kind of mushy nonsense many times in the last several decades:

“We must not reckon profit and loss according to the book, but only according to political needs. There must be no calculation of cost. I require that you do all that you can and to prove that part of the national fortune is in your hands. Whether new investment can be written off in every case is a matter of indifference.” From speech in 1936 by Goering, the Nazi minister for economics, quoted in John Hiden: Republican and Fascist Germany (Longman 1996), p.128.

OTOH I take this kind of critical assessment of consumer rationality seriously:

The Paradox of Choice, a Google lecture by Prof Barry Schwartz:
http://video.google.com/videoplay?docid=6127548813950043200

Marketing theorists really do have a developed strategy called: Confusion Marketing.

15

‘Importance’ might be in the eye of the beholder but I think you will find that science demands that all known variables are considered, so I call that an important aspect of studying any phenomena. But it doesn’t surprise me that you dismiss that, because that is what economics demand that we do. The quote you refer to about profit and loss, which is more akin to book-keeping than economics, and reflects the speaker’s particular values. And this is why economic predictions fail, not because of any particular political leaning but because it fails to consider subjective motivations which cannot be objectively costed or predicted.

To apply this to the debate in question, the Olympics appear to have great (subjective) value for many people who may or may not feel that the financial outlay was justified.

We need to understand how markets function without sentimental fog’.

That ‘sentimental fog’ is human subjectivity, and it’s what seperates human beings from economists.

16

“Importance’ might be in the eye of the beholder but I think you will find that science demands that all known variables are considered, so I call that an important aspect of studying any phenomena. . . ”

Most of that is just nonsense IMO. Science makes no such claim. Scientific models almost invariably simplify. Newton’s laws of motion assume a vacuum – a body falling out of a plane doesn’t fall according to Newton’s laws of motion because of air resistance. It would be silly to dismiss Newtonian mechanics because of that.

“To apply this to the debate in question, the Olympics appear to have great (subjective) value for many people who may or may not feel that the financial outlay was justified.”

Evidently so but it’s up to the rest of us to comment on the consequences of choosing to ignor cost considerations and allowing the euphoria to obscure the downstream consequences of neglecting to tackle the deficiencies in primary schooling.

Elite sports may make a few very wealthy but the living standards of most of us depend on our education. Failing competence in the basics of reading, writing and maths at primary school is very likely to hold back personal development in secondary schooling and thereby block prospects for tertiary education:

“The National Curriculum test results also revealed that in spite of an improvement in English and maths, more than a third of pupils still left primary school without a proper grasp of the basics in reading, writing and maths.” [August 2010]
http://www.ft.com/cms/s/0/ba881948-9f3f-11df-8732-00144feabdc0.html

The Guardian May 2010: “One fifth of school-leavers so illiterate and innumerate they struggle to cope with challenges of everyday life.

18

You are confusing simplification with ignoring variables as in your own example of air resistance affecting a falling object, which you note would not perform the same way if it occured in a vacuum. Do you really believe that scientists at NASA would ignore possible changes in air resistance (a variable) when eg developing space rockets and calculate on the basis of the conditions in a vacuum?

And is it your own value that the Olympics are less important than say the outcome of National Curriculum results?

19

You are evidently confused. Newtonian mechanics assumes a vacuum. That is the theory which we don’t discard because of the simplifying assumption. Of course, NASA and army snipers take into account air resistance and wind velocity when making calculations but that is because the basic Newtonian theory doesn’t.

“And is it your own value that the Olympics are less important than say the outcome of National Curriculum results?”

The HoC Public Accounts Committee has reported its concerns about the poor general standards of adult literacy and numeracy and the downstream consequences. IMO that is of much greater relevance to supporting and improving general living standards and productivity in work than elite sporting opportunities for the few so they can make a lot of money from advertising product endorsements.

Economists are much better at criticising mainstream economics than rank amateurs who know little economics. Try the references @12.

Newton’s laws don’t assume vacuum. In fact they implicitly take drag and friction into account. And you’d hope so given Gallileo and others were talking about friction long before Newton.

As for mechanical markets, I’ve been reading a bit about economics and markets recently and I don’t recall seeing them described as such; christ, if anything is “subjective”, it is the value of a widget that the buyer and seller respectively perceive.

“My goat is worth five chickens.”

“Come off it, it’s clearly only worth two chickens and a few of these logs.”

The models might appear mechanical; “if this happens, then that happens.”

20

‘Of course NASA and army snipers take into account air resistance and wind velocity when making calculations but that is because the basic Newtonian theory doesn’t’

Quite, those calculations enable (mostly) for outcomes to be predicted because they take account of the variables, or, to put it another way, phenomena which will affect the outcome. Economics ignores factors which affect outcome and label them ‘sentimental fog’, thankfully NASA scientists do not take that approach and I doubt if you will find scientists in any other discipline treating variables as inconsequential.

I am aware of your opinion with regard to adult literacy and note that you quote the HoC Public Accounts Committee but all of this is subjective, indeed, if there followed a large demand in sporting activities and products, after the recent Olympics, we would be pointed in the sporting direction as a means of improving national productivity.

@Bob B #9:

All that I’m saying is that promoting compulsory team sports in primary schools, at the expense of basic skills in reading, writing and maths, is going to do no end of harm to the lifetime earning prospects of many.

I don’t think anyone disagrees with this. The issue is with the “at the expense of” in the middle of that sentence. This implies a view that schools are already operating as effectively as they can, so that any shift in focus from academics to sport of necessity will adversely affect academics. You have failed even to attempt to demonstrate the truth of that hidden premise.

Robin

There are only so many hours in the day and only so many resources. Is more taxpayers’ money going to be put into primary schooling to afford the additional teachers and facilities for all the compulsory additional sports? What other lesson time will have to be given up to allow for the additonal time spent playing additional sport?

Yorkshire likes to flourish the number of Olympic medals it won. Fine. Perhaps Yorkshire would also like to post up the number of failing schools it has and where Yorkshire districts come in the league table for English local education authorities.

Downstream, I suspect employers and inward investors will be the more impressed with this factor than with Olympic medals:

London has the best state schools in England
http://www.ft.com/cms/s/0/2c0866fe-dbca-11e1-aba3-00144feab49a.html#axzz23XlbXWaE

22

“Economics ignores factors which affect outcome and label them ‘sentimental fog’,”

The classic case in recent times where sentiment prevailed over hard economic analysis was in the launch of the Euzozone. After all, Greece as the country of Plato couldn’t be excluded. As we can now see, the consequences have been disastrous.

A bit of history: As Snowden – the chancellor in Ramsay MacDonald’s Labour government 1929-31 – reportedly said when the so-called National Government took Sterling off the Gold Standard in September 1931: They didn’t tell us we could do that. By April 1932 Bank Rate was down to 2pc where is stayed until August 1939, close to the outbreak of WW2. The result was a housing boom – mostly in the south of England and the midlands. The National Government wasn’t inhibited by any sentimental attachment between Sterling and Gold.

@Bob B #24:

Can we have this argument in only one thread, please? As I’ve said in the other relevant thread, you are assuming that in all cases teachers are teaching as effectively as is possible given the time and resources available to them. That is an assumption that requires justification, particularly in the light of variations in school performance; could you provide that justification in the other thread?

As for Yorkshire’s alleged medal tally; there is some very odd counting going on. You can’t for example have both Armitstead (born in Otley, trained in Manchester) and Ransley (born in Ashford, Kent, learnt to row at York University). Again, Triggs Hodge is a little suspect (born Aylesbury, home town Hebden, learnt to row Staffordshire, rowing club Molesey).

<blockquote.London has the best state schools in England.

And London provided more medallists than Yorkshire…

25

It is interesting but how was ‘economics ignored’ and more importantly which hard economic analysis predicted or otherwise the outcome which we all now know with hindsight?

Greece is known for its’ great thinkers, mathematicians, scientists and philosophers, and also the Olympics, but despite its’ great intellectual history it has never been a wealthy country, which kind of questions your view that intellectual pursuits are the future for our increased national productivity.

Steveb

“It is interesting but how was ‘economics ignored’ and more importantly which hard economic analysis predicted or otherwise the outcome which we all now know with hindsight?”

Not so. I was only marginally aware of the potential pitfalls of monetary union in the mid 1990s – it wasn’t my job interest at that time: IT was. But then I read the late Rudi Dornbusch on: Euro phantasies, in Foreign Affairs September 1996. His paper is available online but it has a steep subscription barrier: the gist of his analysis is included in later editions of his mainstream text: Macroeconomics (McGraw Hill). Dornbusch, who was born a German national, was prof of international economics at the MIT. Other warnings came from Paul Krugman, and also from Marty Feldstein on EMU and internatioanl conflict, in Foreign Affairs November 1997:
http://www.nber.org/feldstein/fa1197.html

And from James Forder with Christopher Huhne in: Both Sides of the Coin (Profile Books 2001). Heseltine, a leading advocate of Britain joining the Euro, was advised against that course by his own economic adviser Walter Eltis – see his book: Britain, Europe and EMU (Palgrave 2000). The potential pifalls are clearly evident in what has beome the standard text: Paul De Grauwe: The economics of monetary union (OUP).

I’m a veteran of the online debates c. 2000 about Britain joining the Euro. My PC was much hacked at the time and if the Europhiles had had their way, I would have long since been consigned to a lunatic asylum for posting then that Britain should avoid joining the Euro. Sensible debate became impossible.

Monetary unions without political and fiscal unions have poor track records of survival in history. Countries in monetary unions loose national autonomy in setting monetary policy to suit national conditions. Optimal currency areas depend on the national economies of constituent countries behaving in a sufficiently similar way (“convergence”) so they can live with the same monetary policy regime without unacceptable instability – such as the property price bubbles of Ireland and Spain in the Eurozone. Without fiscal systems to transfer funds from chronic trade surplus countries in currency unions to chronic deficit countries, deflationary pressures will build up.

Robin

“Can we have this argument in only one thread, please? As I’ve said in the other relevant thread, you are assuming that in all cases teachers are teaching as effectively as is possible given the time and resources available to them. That is an assumption that requires justification, particularly in the light of variations in school performance; could you provide that justification in the other thread?”

Schools may fail for many reasons besides poor teaching – reasons such as traditional antipathies towards any kind of academic learning. I’ve often posted this quote from George Orwell: The Road to Wigan Pier (1937), Chp.7:

“The time was when I used to lament over quite imaginary pictures of lads of fourteen dragged protesting from their lessons and set to work at dismal jobs. It seemed to me dreadful that the doom of a ‘job’ should descend upon anyone at fourteen. Of course I know now that there is not one working-class boy in a thousand who does not pine for the day when he will leave school. He wants to be doing real work, not wasting his time on ridiculous rubbish like history and geography. To the working class, the notion of staying at school till you are nearly grown-up seems merely contemptible and unmanly.”
http://orwell.ru/library/novels/The_Road_to_Wigan_Pier/english/e_rtwp

As is clear from Orwell’s text, he was then writing mainly about South Yorkshire. Elite sports – and football mania – are welcome distractions from such tedious lessons doing reading, writing and maths.

There are only so many hours in a day: which lessons are to be pruned to make way for those additional hours of compulsory sports in primary schools?

When making their investment decisions, I suspect employers and inward investors will be more influenced by the availability of a skilled and educated workforce than by the availability of a few elite athletes.

28

There is too much information in your post for me to digest but I note that, as far as I can see, there is no reference to Greece
.
But before you spend any more time trying to convince me of the scientific merits or otherwise of economics, I have never stated that they are not useful. I put them in the same category as a GP attempting to ascertain what may be wrong with a patient, which requires a great deal of knowledge and skill. The science is the objective tests and observations together with the interventions, which have been researched and practised over a long period of time.

And returning to the subject of the thread, we haven’t had enough time to stand back and judge what impact the Olympics have and whether or not they were worth the financial outlay. It is pointless suggesting that we should concentrate more on intellectual pursuits when large numbers of graduates in all disciplines can’t get work. And do you think that if every failing school in Yorkshire was to suddenly produce excellent exam results, our our national productivity would rise?

29

According to Orwell ‘He wants to be doing real work’ not football mania. I’m surprised you got that wrong considering the number of times you have quoted the text.

30

Greece always was an outlier with little of the convergence needed to fit into a stable “optimal currency area”. There was a prior substantial economics literature on the requirements for a stable monetary union but that was ignored, as was the critical literature about EMU and the advice of the EU Commission because Europhile politicians wanted to press ahead on the way to the ever closer integration of Europe regardless. As Delors said in an interview last December:

The Euro was doomed from the start:
http://www.telegraph.co.uk/finance/financialcrisis/8932647/Euro-doomed-from-start-says-Jacques-Delors.html

“And returning to the subject of the thread, we haven’t had enough time to stand back and judge what impact the Olympics have and whether or not they were worth the financial outlay.”

Judging by media reports, we can be pretty sure that some dedicated academics and journos are focused on tracking the costs and benefits. For sure Britain created a good international impression but I worry that various internal vested interests will divert attention and resources from issues that we really need to worry about. There is a lot of bad news that some want to bury.

@Bob B #29:

I feel like I’m arguing against Eliza…

Defend your claim that it is without exception impossible to teach children better than they are now being taught.

Robin

“Defend your claim that it is without exception impossible to teach children better than they are now being taught.”

I’ve not claimed that. More importantly, you haven’t said what other lessons are to be scrapped order to make way for the additional compulsory team sports in primary schools and whether that is conducive to reducing the third of primary school leavers who are deficient in basic reading, writing and maths skills. We also need to know where are the additional sports teachers to come from and whether they are to be added to or will replace existing teaching staff.

It’s amazing how all that has been quickly swept under the proverbial by the campaign for more compulsory team sports. With all the talk in the news about over optimistic tendering for the west coast rail franchise, it’s timely to recall that the predicted cost of the games when London won the bid in 2005 to stage the Olympics was £2.37billion. That increased four fold and no one batted an eyelid.

@Bob B #34:

“Defend your claim that it is without exception impossible to teach children better than they are now being taught.”

I’ve not claimed that.

Yes, you have – see your next sentence.

More importantly, you haven’t said what other lessons are to be scrapped order to make way for the additional compulsory team sports in primary schools and whether that is conducive to reducing the third of primary school leavers who are deficient in basic reading, writing and maths skills.

If teaching of basic reading, writing and maths can be improved, then even reducing the number of hours teaching those skills need not affect the quality of the teaching.

You have claimed that reducing the hours spent teaching those skills necessarily and without exception reduces the academic standard of those pupils.

In any event – what is wrong with increasing primary school hours by 24 minutes a day to make time for 2 hours of PE?

Robin

C’mon. More time spent on compulsory sports in primary schools means less time spent on other subjects – be it reading, writing and maths or geopgraphy, history, art and music. My perspective is that we need to worry more about the finding that a third of primary school leavers are deficient in basic reading, writing and maths skills long before we require schools to devote more lessons to compulsory sports. A third is an especially worrying high percentage.

I’ve already said @29 that local entrenched cultural pressures may be averse to anything remotely academic and teachers may be hard pressed to compensate for that. More time spent on sports stokes the very notion that sports is more important than all that boring academic stuff.

We’ve still not resolved where the extra sports teachers are coming from and whether that will mean other staff will have to go.

In the BBC Today programme this Thursday morning, someone from the CBI was saying about two-third of new jobs are high-skill jobs. Deficiency in reading, writing and maths is not a good starting point for high-skill jobs. It emerged that the CBI is producing an analysis of employment trends around October time. I’ll be watching out for that.