07/09/2014
It is not often that this column speaks kindly of the EU,
writes Booker (with the text from his original piece, before editing).
But, he continues, I'm afraid all that hyper-ventilating about how Brussels is trying to save the planet by "banning" our vacuum cleaners and much else completely misses the point of a rather interesting story. As one tabloid front-page screamed "Now kettles face EU ban: Brussels meddlers in new assault on our way of life".
In fact there is no "ban" on powerful vacuum cleaners, kettles, hair-dryers or anything else. What Brussels is doing, under its eco-design directive, 2009/125, is to encourage manufacturers to develop appliances which require less electricity to produce a much more efficient performance. We had various technical experts last week trying to explain this, even on the BBC' s
You and Yours programme, but their common sense was drowned out by the wave of hysteria over those "Brussels meddlers".
There is not even any total ban on those appliances which use more power than is necessary. Since the directive refers only to "domestic" use, it is still possible, as with light bulbs before them, to buy vacuum cleaners above the new power limit, so long as these are for "commercial or industrial" use. Sir James Dyson tells us that he could make a machine just as effective as the 2,000 to 3,000 watt models now being "banned", using only 700 watts.
What Brussels is doing here is to follow similar moves in America and elsewhere to reduce our overall electricity demand simply by switching to appliances so much more efficient that, in the US, washing machines are now on sale which have cut energy use by 75 percent but which cost 45 percent less and even wash clothes even more effectively.
This is all part of a drive to promote what is called "demand side management", by devising ways to cut electricity demand without reducing overall performance. Demand side management may be particularly popular in Europe because of the need to accommodate all those absurdly expensive windmills and solar panels which are so inefficient and unreliable at producing electricity.
But it is still a sensible step, Booker concludes, which could eventually save us having to build three or four more proper power stations. Perhaps Brussels could now consider passing a law making it illegal to produce electric kettles which last only a year or two before we have to rush out to buy new ones.
And with that, Booker steps into the debate that has been rampaging through this blog for the last few day, his column eliciting over 500 comments (so far) on an issue which invokes some passionate responses.
One of the interesting comments on Booker's column related not to vacuum cleaners, but
washing machines, asking where the sense was in no longer allowing hot-fill models. Yet, it seems, the Commission had
thought of that and the reasoning (on face value) seems plausible (see page 70).
Looking at the comments, it seems there is much the same mix as found on this blog. There are those who believe energy efficiency standards should be left to the market, and that there is no room for regulatory interference; there are those who object in principle to EU involvement; and there are those who object to the measure because it is focused on saving CO2 emissions, rather then energy efficiency,
per se.
What particularly intrigues me are those who argue â as a matter of principle â that deregulation is the way forward to a more healthy economy, with inherent presumption that regulation is necessarily a Bad Thing, while the absence of regulation is a Good, always to be sought after.
I was thus asked to look at
this piece by Alistair Heath, telling us that: "Growth-destroying red tape is holding Britain back", as if this was might be the final word on the debate.
One has to admit to a certain malicious pleasure in being able to say that Mr Heath was still in short trousers when I was trudging the streets in Whitehall, trying to make sense out of John Major's 1992 deregulation initiative. I am no more enamoured with the process than I was then.
Simply, before we get to the point of deregulation, we have to get to the point of understanding something of the regulatory process, and its manifold drivers, knowledge which seems to be missing from all levels of society.
Illustrating this, we get Heath writing of "our reflexive national obsession with seeking to regulate and restrict all that moves", as if this somehow explained why governments throughout the world â irrespective of cultural base â seek to regulate the affairs of their societies. Such facile analysis, it seems to me, is very much part of the problem.
Nevertheless, this paves the way for Heath to tell us that this "obsession" also comes "with immense yet hidden costs", as if the concept of "cost-benefit" had yet to be invented. Yet cost is of no matter if the benefit is substantially greater than the cost, and we can afford the initial investment.
What can only then invoke a wry smile is Heath's reliance on a paper published in the
Journal of Economic Growth by two US economists - John W Dawson, of Appalachian State University, and John J Seater, of North Carolina State University.
In "Federal Regulation and Aggregate Economic Growth", we are told, the authors use "sophisticated econometric techniques to calculate how regulations affect the US economy". And, it turns out, "the growth-destroying impact is even greater than many had previously thought â and there is no doubt that similar conclusions would apply to the UK".
If one pauses to note that "sophisticated econometric techniques" is another name for computer modelling â the use of which Mr Heath would abhor when applied to climate change predictions â we find him asking us to accept that:
Regulations added since 1949 have slashed the annual US GDP growth rate by about two percentage points, an astonishingly large figure. As a result of the power of compounding, this means that, shockingly, US GDP was at last count a mere 28pc of what it would have been had regulation remained at its 1949 level.
However, the idea that "level" of regulation is a useful working parameter is, frankly, absurd. Amongst other things, it ignores entirely the fact that the economy has expanded and had become far more complex, with processes and industries that didn't even exist in 1949.
In the particular context of the vacuum cleaner regulation, though, it perpetrates a huge fallacy. If this and other efficiency regulations are successful, they will â alongside other power management techniques â reduce significantly the amount of electricity we have to produce, and the number of power stations we will have to build - thereby reducing overall the GDP. Thus, in this case, a reduced GDP is a measure of regulatory success.
In this one issue, therefore, we see all manner of points raised, which means that we are far from finished with the discussion. It is one to which, I suspect, we will be returning.
