Dominic Sayers

Mutual societies and apocalyptic events

Back at the dawn of time (2006), I wrote a series of posts to record some things I believed in. These were things I believed without being able to prove they were true - naked belief. I'm happy to say I still hold all these beliefs. Not that I cling to opinions when the facts change - I'm with Keynes on that one. But history has not demonstrated that any of these beliefs are wrong. In fact, history has started to provide some evidence in favour of some of these beliefs.

Mutual societies

Today news emerged of the Dunfermline Building Society's failure as a going concern. I claim this actually reinforces my belief that mutual societies should be some sort of protected species. What went wrong seems to be the the Dunfermline stopped acting in the long-term interests of its members and started behaving as if it had shareholders. Making aggressive commercial loans and approving risky mortgages is not what a mutual society should be doing (unless it's a mutual society of capital markets professionals). So my belief is refined somewhat: mutual societies should be encouraged by (for example) favourable tax legislation but their activities should be constrained by some sort of covenant that members are made aware of when they join.

Apocalyptic internet event

You're mad! was the usual reaction when I tried to persuade the pezzonovanti at my last company that there was a seismic event waiting to happen in the financial services industry. Turns out I was right, but I'm not claiming to have predicted the sub-prime crisis. My event was to do with data security and it hasn't happened yet. But the bots are gathering, and they are being expoited commercially in an ever more sophisticated way. The datapocalypse is coming. Don't say I didn't warn you. There's more than one black swan.

Tony Benn doing what he does

Whether you agree with him or not, the world needs people who do this: [youtube=http://www.youtube.com/watch?v=E21MdXe3BOQ&color1=0xb1b1b1&color2=0xcfcfcf&feature=player_embedded&fs=1] (Thanks, Glinner)

Which infrastructure projects would you invest in?

Firstly, IANAE (I am not an economist). There seems to be some sympathy for the Keynesian notion that one way out of recession is to (a) reduce interest rates and (b) make substantial investments with public money into infrastructure projects. Well in the UK we've done (a) to the extent that interest rates are at a record low. It would appear the only thing left is to start with the infrastructure investments. So what would you do to stimulate the UK economy? Here's my list:

1. Fibre To The Home (£29bn)
2. New airport in the Thames Estuary (£14bn)
3. Crossrail (£15bn)
4. High-speed rail link to the Midlands (£20bn)

A total bill of £78bn, a staggering amount in normal times but looking less intimidating compared to the sort of money the UK government is putting into rescuing the ailing banks. All the items on my list are existing proposals. Two of them are actually Conservative Party policy, so there is no lack of support for Keynesianism there. Crossrail is struggling to get the private finance it needs to get off the ground. This is not surprising given the current problems with the availability of credit. The government should just do away with the PFI smokescreen and get this project on their balance sheet. There's lots of other possibilities, but I've tried to include projects where the benefits are obvious and immediate and nothing is added to the operational cost base of the government - all these things would generate operating profits once built. And they would all benefit me personally. So get on with it please, Gordon.

One law for everybody - how dangerous!

According to the BBC, the Archbishop of Canterbury has just said in an interview "there's one law for everybody... I think that's a bit of a danger". He was talking about the introduction of Sharia Law for certain classes of litigation and for certain litigants (Muslims presumably).

Personally I'm not convinced. There's a very good reason for justice to be blind. Good enough for that to be the statue on top of the Old Bailey. Introducing a different legal system for a particular subgroup seems to me to be the danger, not the concept of "one law for everybody". I fully support the Archbish's right to talk about these issues and he's not a stupid man. And I'm sure the quote was taken slightly out of context (just as I have done here, I suppose). But I'm a strong believer in demonstrating that something is really broken before you decide to fix it. The principle of one law for everybody has stood the test of a considerable amount of time.

More on open source and security

Now Wired and TechDirt have chimed in on the same theme, that voting machines can only be acknowledged to be secure if the source code for their software is publically available. This isn't quite the same as open source, of course. They are not suggesting that the code should be publically changeable. Wired makes the valid point that scrutiny of the source code ought to be (and quite possibly is) a constitutional right. Also I didn't know that Australia had already done this two years ago.

The Economist on open source and security

I haven't yet attempted to support my belief that open source code is the only secure code, it remains a postulate. External support comes not just from Bruce Schneier et alii but this week also from The Economist. Unfortunately the online version of the article is hidden behind a paywall, but if you happen to be a subscriber then check it out here.

It's only a sentence at the end of the article, and I'm not sure the writer has any particular authority on the subject, but hey, it's The Economist :-)

Beliefs (0): Introduction

In these posts I am recording the things that I believe to be true without necessarily being able to prove them (yet!). Sidenote: here are some other people's beliefs: Edge World Question Centre 2005

Beliefs (5): Open source code is the only secure code

There is no point in depending on security through obscurity. It is possible to build a secure system even though everybody knows how it works. In this context, I also believe it should be a constitutional right for Americans to be able to see the code for the voting machines that register their electoral votes. If such machines are introduced in my country I will not use one until I have independent assurance that they are fair and secure.

Beliefs (4): There is a substantial risk of a catastrophic internet event

Despite all their investment in perimeter security, major corporate organisations are under a real threat of losing business or even losing their business. The corporate world has built a connected interdependent system that is based on a single technological platform. Anybody who believes that platform is not able to be compromised, or that nobody is interested in doing so, is living in a fantasy world. The evidence is public and the logic is simple.

Beliefs (3): No representation without taxation

I agree with the commonly-held belief that you shouldn't be taxed unless you are represented on the body that is taxing you. The Boston Tea Party was a worthy cause. However I also believe in the slightly less popular obverse argument. Why should you get a vote if you don't pay tax? Yes I know this unfairly disenfranchises women, who often are bringing up children rather than paying tax. Maybe there could be some exceptions to my rule but I'm talking about a general principle here.