A sideways look at economics
Christmas is fast approaching, so what better way to end a year of Thank Fathom it’s Friday than with a short Christmas tale? A merry Christmas to all who celebrate, and happy, restful holidays to you all!
It was a dark and freezing cold afternoon when Mr Claus trudged in from the reindeer feeding. Based on the weather outside, you would think that all was right in the world: that the polar ice caps weren’t melting, and that the Claus household was not seriously considering a big relocation. You would, however, be wrong. Temperatures were rising all over, spring was coming earlier each year, and Arctic snow and ice were all too often replaced with dreary downpours of rain.
They had settled on London for their move, because, as Mr Claus reasoned, if it was going to rain all the time they might as well have access to better cultural services. The North Pole, while many things, was not a noted hub for thespian activity, to Mr Claus’s great dismay. Mrs Claus had tried to convince her husband to move to France, dreaming as she did of warm summer nights and the smell of lavender fields, and reasoning that if they were going to move, they might as well go somewhere the weather was nice. However, Mr Claus had been adamant that his complexion was not at all suited to the climate in Provence, and so they had started looking into what it would cost to move to London.
As he knocked clumps of snow off his boots — brown for everyday wear — Mr Claus reminded himself to remind Mrs Claus to remind him that they needed more of that premium reindeer feed that Blitzen loved so much. You might reasonably ask yourself why Mr Claus needed to remind himself to remind Mrs Claus to remind him, when he could just remind himself, but that is a question for a different day and perhaps a different blog.[1]
Meanwhile, in the kitchen Mrs Claus was poring over the mock-up of what their yearly accounts would look like if they went through with the move, her frown getting deeper and deeper with every perusal. In fact, her distress over the increasingly unbalanced balance sheet was such that she barely registered the banging noises of her husband kicking his boots against the hallway wall.
“Hello, my dear!” Mr Claus cried in a jolly way as he entered the room, rubbing his hands together in front of the hearth and making drops of snow cascade from the sleeves of his coat and jump and spit in the flames. “Are you still doing the mock accounts? Let me know when you move to inventory, will you, we need more of that Cari-booyah feed. And don’t you think I should have new red boots this year? The trimming’s really not looking its best on the old ones.”
“New boots?” Mrs Claus exclaimed. “Not a chance! With these prices we’ll have a struggle putting Christmas together at all. And the reindeer will have to make do with hay from now on.”
“What?” Mr Claus looked taken aback. “But Blitzen loves the new feed, and the others do too, you know. Why, I don’t think I’ve ever seen Rudolph’s nose this red before.”
Mrs Claus shook her head in exasperation, “Look at this!” she exclaimed, pointing to a chart titled ‘Estimated reindeer upkeep’. “Reindeer food is up by more than eight per cent just over the last year.
“That’s not even counting the veterinary costs, as we’ll need at least one vet visit per year if we move to London, after that new EU regulation on animal health certificates.”[2]
Seeing that her husband was about to interrupt, Mrs Claus quickly went on, “And the elf wage costs will go up, not only because we’ll have to pay more to match the UK manufacturing wages, but also because you know the ELLO [3] will insist on being compensated for the generally weaker labour laws.”
“Not to mention,” she continued to her increasingly overwhelmed husband, “the cost of bringing the elves over in the first place, nearly £1000 in visa application fees per elf — and then there’s the immigration health surcharge, which is going up in January to £1035 per elf per year, and needs to be paid upfront.”
“But the elves are highly skilled, and as we only need them for part of the year they could be employed in other work during our off-season. I thought the UK was suffering from labour shortages?” said Mr Claus, confused.
“Well, they are still to some extent,” Mrs Claus agreed, pointing to a chart on the latest vacancy figures. “Nevertheless, those are the fees.”
“Well,” Mr Claus began, fingers now anxiously and dangerously tangled in his luxuriant white beard. “Surely we’ll have some funds from selling the house. Couldn’t that cover some of it?”
“Not really,” Mrs Claus sighed. “We would need to buy a new home with an adjacent workshop there, and London house prices have more than doubled in the last decade.”
Both fell silent, with Mrs Claus wondering whether this was the right moment to pull up her chart comparing house prices in southern France,[4] and Mr Claus desperately trying to find a solution that allowed him to fulfil his lifelong dream of a semi-retirement that included weekly visits to Shakespeare’s Globe theatre.
“I’ve got it!” Mr Claus suddenly cried, quite shocking Mrs Claus out of her reveries, which involved drinking rosé while painting on the terrace. “I’ll email James. We haven’t asked for more funds in the last five years, and he has plenty of money.” James was Mr Claus’s cousin several times removed, though with the exception of his white hair he bore little resemblance to his elder relative. He did, however, have a key redeeming feature, as he was chief executive of the Coca-Cola Company — the Claus Corporation’s chief donor.
And so Mr Claus went into the office to compose his email with a renewed spring in his step, while Mrs Claus resigned herself to becoming a regular passenger on the Eurostar, trying not to focus overmuch on the added 4.5-hour train journey she would need to take to get from Paris to Aix-en-Provence. As the week passed waiting for a reply, they carried on preparing for Christmas: the gifts slightly smaller this year than last, as the North Pole hadn’t completely escaped inflation either. The reindeer grudgingly accepted the re-introduction of hay into their diet. However, when the reply arrived it was not what they had been hoping for.
Dear Cousin,
Thank you for your message! Sadly, the advent of the new drug ‘WeGovy’ – the highly successful weight-loss drug (have you heard of it?) – means we cannot set aside extra funding. The potential for a large drop in consumer demand for fizzy drinks and the like has made our CFO exceptionally tight with the purse strings.
I wish you and Mrs Claus all the best and good luck with your busy season!
Warm regards,
James.
Mrs Claus looked over at her husband, whose downtrodden and defeated expression recalled to mind a child who’d just been told that Christmas had been cancelled. “I’m sorry, darling,” Mrs Claus consoled, “but it’s not all bad, even if we don’t move to London. We have each other, we have our health, and we have our purpose: to spread Christmas cheer to one and all.”
“I suppose so,” Mr Claus sighed, picking up the large bundle of newly arrived Christmas wishes. “I’ll take these over to the workshop, then.” So distracted was he by the unfortunate news, however, that when one of the wishes blew off the pile and into a dark and dusty corner, he didn’t notice it at all. If he had, this is what he would have read:
Dear Santa,
For Christmas this year all I want is inflation at 2%.
Your friend,
Andrew Bailey.
[The end.]
[1] If you’re unfamiliar with the domestic concept of ‘the mental load’, this article is a good place to start. https://slate.com/human-interest/2018/03/women-are-overburdened-with-their-families-mental-loads.html
[2] The chart is based on eurozone data but the picture is likely to be similar for UK, as evidenced by the CMA launching a review of the veterinary sector in part due to high prices. https://www.gov.uk/government/news/cma-launches-review-of-vet-sector
[3] Elf Labour Laws Organisation.
[4] Admittedly these had nearly doubled too, but there was a vast difference between a rise of 150% and a rise of 95%.
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