Not so long ago, I wondered
whether capitalists and supporters of capitalism really understood the way it
worked, a theme picked up again in relation to pubs in this
post. Pubs, in particular, have been back in the news again over the last
week, with Farage’s proposal
that impoverishing 450,000 children and redirecting the money saved into pubs
could knock 5p off the price of a pint and save thousands of pubs, and the suggestion from the
First Minister, Eluned Morgan, that people should stop drinking wine and
watching Netflix at home and get down to the pub instead. The opposition’s
response to the First Minister was, sadly, more Farage than Morgan, claiming
that the problem was for the government rather than citizens to solve, and lies
in the system of rates and taxation. Both Farage and the opposition in the
Senedd seem to be starting from the wholly unrealistic proposition – albeit a basic
tenet of classical economics – that all consumer decisions boil down to cost
comparisons. Under that tenet, people choose wine and Netflix over beer and
pubs purely on the basis of relative cost.
Like much of theoretical economics, it’s utter
nonsense. It is an established fact that young people, overall, are drinking
less and that traditional pubs are considered increasingly unattractive to many
of them. Cutting the price of a pub visit so that more people go, or
encouraging people to drink more when they get there – which is what subsidies,
whether direct or in the form of tax concessions, actually set out to do – might
delay the inevitable, but if supply outstrips demand by an increasing margin,
and if that falling demand is the result of demographic change rather than
price considerations, then capitalism decrees that the supply should fall. Put
another way, closing pubs is the natural and rational outcome of a change in
consumer choices.
Whether that’s a good thing or not is another
question. I’m certainly not a fan of leaving all decisions to the dictates of
capitalist markets. There are some pubs – particularly, but not exclusively, in rural
areas – which also provide a sort of community hub, and act as a centre for
other (not necessarily alcohol-related) activities. There is a case, in terms
of social cohesion rather than dry cost-benefit analysis, for government action
to keep such places open. That, though, requires rather more effort in
identifying criteria and assessing locations against those criteria than some
sort of blanket aid to the sector (which is what changes to the taxation regime
provide). Setting out to save all pubs may be popular with those who use them,
but it’s not good policy, and nor is it a good use of resources. And proposing
to impoverish children to achieve it is about the best illustration one can
think of as to why it’s wrong.
Posts
2 comments:
Well argued piece if I may say so Borthlas. Agree in full. Pubs, eh? They don't have a divine right to exist. I have enjoyed many a pint in many a pub but they do tend to under-deliver. Wrong for meetings (eg Plaid branches) that have any claim to be serious. Loss of pubs is a downstream symptom of social fragmentation that has many deep and worrying causes. Of which child misery and undereducation are two more symptoms. Duw a'n helpu if we have to rely on the Noble Baroness to provide Welsh answers to chilling Welsh problems.
Pub closures are hardly a new thing. For example, Dic Mortimer has been running a "Pubocalypse" series since he started his website some 15 years ago, documenting the demise of the "local" in Cardiff. A common theme seems to be that while some are sadly missed, many of the rest - particularly those taken over by certain corporate chains - are or were pretty grim. And while I'm on the subject, the food in many of these chain pubs is really not very good - the ones who do serve decent food seem to be doing OK. You gets what you pays for, I guess.
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