Remain or fade

The big day is here. A referendum that should never have happened, forced by a minor extremist party, allowed to happen by intellectual lightweights in government. The EU Referendum decides whether Britain keeps its seat at the table or is pushed outside to listen through the keyhole. So despite my libertarian leanings I’m voting to stay.

This is why. (Note: I have Masters training in finance, statistics, and behavioural economics, so while not a pro, I’m at least an informed amateur). Here we go:

Pretty much everyone believes a Brexit means economic difficulty for a while. Opinions as to how bad it’d be vary, but nobody – Remain or Leave – is pretending it’d be hugs and puppies by Monday. With even Leavers generally agreeing there’ll be a year or two of pain.

Now while we can predict broad economic outcomes a few years out with some accuracy (it’s called the Short-Term Debt Cycle) nobody can predict much beyond that.

So: there is 100% agreement we’ll have a couple of painful years -a timescale we can predict. Versus a 50% belief we’ll grow faster afterwards – a timescale that can’t be predicted.

In other words, Remain’s economic case is grounded in reality, whereas Leave’s is based on wishful thinking.

Someone on the street offers you a choice of £10 today, or a 50% chance of £12 in five years. Which would you take?

If you like Gaussians, then assuming the first guess falls within two SDs and the second within the third, this means there’s over 95% chance the economy is best off with Remain, versus less than a 5% chance it’s best off with Leave.

Based on simple statistics, the economy is better off if we Remain. Because a Remain vote is grounded in solid reality, whereas a Leave vote is wishful thinking. If you’re voting on the economy as I am, Remain is your best choice.

Simple solutions to complex problems: target the hardcore criminals

The USA’s “black budget” – the part of security spending outside scrutiny, including the NSA’s spy-on-everyone programmes – is now an incredible $59bn. All of it unaccountable with the figure rising each year. There’s a much better way to achieve national security – one that preserves civil liberties for the law-abiding while creating half a million jobs for no net increase in cost. The solution: focus on the actual criminal.

Let’s look at some UK figures first. In England & Wales, a hardcore of 5000 people commit around half of all crime. Raise the set to 100,000, and you’ve basically covered all crime except the odd parking ticket. Assuming the same dynamic applies to the USA, that’s 25,000 people on the Most Dangerous List and half a million on the Watch List.

(The USA locks up a lot of people for life who’d merely be cautioned in the UK, so the actual figures might be higher, but the principle holds.)

The simple solution to this complex problem: for $59bn you could pay over a million people a decent salary to watch one person each.

That’s it: all these new employees do is follow one specific lawbreaker around, day in day out, reporting on what they do and who they’re doing it with. Infringement of civil liberties? These people are known criminals; they’ve already demonstrated their lack of interest in civil society. And the upside – no need to listen in to everyone in the world’s emails and calls – is a far greater prize.

Imagine: the ancient legal principles dating back to the Magna Carta – the right to be free of unreasonable search or seizure, to not be detained without reasonable suspicion – actually coming back into force, regaining the rights we’ve all lost since 9/11.  Big win for the honest citizen.

The cost structure is appealing, too. Many of those 0.5m offenders will be low-risk and nonviolent. (There are plenty of people in jail across the USA because they got caught with a joint at 18 or slept with a girlfriend aged 17.) So watching them like a hawk wouldn’t even be a full-time posting: the odd phone call and app check-in would suffice.

This means the hardcore ones could then be assigned up to a dozen Watchers each: experienced professionals whose sole job it is to stick closer to the offender than their own shadow. There’s an excellent career path for a young Watcher. In your first years on the job, you get Mildred Who Once Took a Bong Hit Near a Window. With a bit of seniority, you get assigned to Fred Who Repeatedly Drives Uninsured. Five years in, you’re into Boris the Bag Snatcher and Mohammed The Hate Preacher. Stay in the job long enough, you might even get the worst of the worst, a tax-and-spend socialist or something. (OK, but you get my point.)

That’s my simple solution: target the people who actually do crime. Civil liberties get respected once again: the lawbreakers earn credits based on how long they’ve stayed on the straight and narrow, giving both watched and Watcher aligned incentives. The jail population shrinks by two-thirds overnight; over a million people return to society within strict limits. It also erases the artificial distinction between criminal and civil law – which in the USA and UK doesn’t really exist in practice anyway, with 1% of the population in jail and white-collar crimes being charged under Terrorism legislation.

We don’t need a secret security apparatus watching our every move, where everyone is a suspect and your thoughts are used against you. We just need to do the sane thing – watch the criminals.

 

 

The trouble with Harris & Hoole

There’s a new chain of coffee shops in town, which I’d normally regard as a major event: I like coffee but limit myself to one cup a day, so it’s got to be a good one.

I recently tried Harris & Hoole‘s London Bridge outpost and it’s exactly what a hip independent coffee shop should be: chalkboard menus, boho chic decor, unbrushed wood and sunny smiles. Even the server was an ideal representation of a Seattle/San Francisco hipster chick, all short hair, snakehips and big geek-glasses. (I thought she was hot, although to complete the vibe she was presumably gay, or at least bi-curious.) Perfect.

And then you taste the coffee.

Oh, dear.

It’s so bad you can taste the Tesco in it.

Yes, Harris & Hoole isn’t independent. It’s a venture by the supermarket giant, and it shows everything that’s gone wrong with Tesco in the last 3-5 years. There’s nothing wrong with a coffee shop owned by a supermarket; I shop at Tesco all the time. But I used to be a fanatical Tesco fan, and now I only go there because it’s nearby. It fell so far, so fast, so obviously that the brand just hollowed itself out.

I stopped loving Tesco about three years ago, when its boardroom cost-cutting showed up too much in the food. Today I buy the basics there, wine, maybe the odd bit of deli, but most of my £70+ weekly spend now goes to Waitrose. (Which I need to get in the car for.) Harris & Hoole illustrates why.

If you launch a coffee shop, it should really be about the coffee. That should be the single thing you concentrate on first, the one thing you don’t subject to salami-slicing on costs; there are lots of coffee shops out there, so the bean’s got to be special. Yet it’s the most characterless, bargain-basement discount filter drip I’ve ever tasted. And – sharing this with Starbuck’s – it wasn’t bloody hot. I know the marketing rationale: keep it cool and they’ll gulp it and get out, faster table-turn. Well, they succeeded: I gulped and got out. Trouble is I won’t be going back.

Oh, Tesco, you came so close. If only you’d put the resources that went into studying the Seattle scene… into the one thing that mattered.

£100k to £10m: a ten-year project

ad73b-37barsinbunkerGiven my modest life goals, I’ve been thinking about how achievable a rich but not ultra-rich level of wealth really is for the average middle-class taxpayer over the course of his working life. So I’m exploring a challenge-to-self: can one individual, operating alone with a job and a bit of capital, build a £10m wealth portfolio in ten years?

It doesn’t involve following some get-rich-quick scheme. (Nobody who gets rich quick ever does.) It’s about doing the right things: developing solid client relationships, doing the right kind of work, understanding your market. Most of all, it’s about the numbers: credit leverage, asset allocation, yields and margins and revenue streams. It sounds like complex financial stuff, but it’s not. Remember there are only two questions in finance, the cost of capital and the return on it. The assumptions below are reasonable: around 5% capital appreciation, 4% cost of capital, reinvested profits and average rental yields.

I’m not the type who employs people (people suck) so owning a big business is out of the question; startups come with such a high risk factor it’s not reasonable to build this strategy on a business anyway. So this is more about what’s possible for a lone wolf. Someone intelligent and self-actuated, but without infrastructure beyond the benefits of living in a stable nation like the UK. I can’t remember a time when I lived without risk (there’s a factor of seven between my worst and best-earning years); the novelty of this strategy is that it takes risk out, aiming for a positive outcome without requiring assumptions multiple SDs from the mean.

Here’s what to do. (As if I needed to say it, this isn’t financial advice; it’s a hypothetical plan I want to follow myself and you should ignore it totally. I don’t really want you competing with me for hot properties.)

Year One: the setup year.

You need a solid income, whatever it’s from: regular salary, sales commissions, client retainers, whatever. It doesn’t need to be a six-figure monster: my plan needs £60-80k. A high-but-not-skyscraping salary for the UK, not even in the top 1% of earners. If you can only hit £40k or so, it’s still possible but it requires a change in mindset. Cancel the Sky subscription, rent your spare room, sell the car and take the bus. Act like the low-income person you now are. People live healthy lives in the world’s priciest cities for under £20k.

Intertwined with this is your credit rating. All the big ratings agencies allow consumer access: Experian, Equifax, CallCredit. Check your score. If it’s low, take active steps to raise it; not much less than a top-decile credit score allows the balance of credit and yield in this plan. Your goal for this year is to have £100k in investable assets in two years, most of which you’ve got already in less investable forms.

Year Two: the savings year.

With discipline a careful worker can save £20-30k/yr. By Year 2 you’re looking to make first use of it. The only longterm asset capable of paying for itself is property; most great fortunes are built on it. My preference is for small freehold houses in secure locations;  land has been a well-regarded asset for 5,000 years, and things like management fees in flats can eat away huge amounts of cashflow. Furthermore, with no-one living above or below to worry about, risk is minimised.

Britain’s property websites allow awesome depth of research; leverage them. My plan involves two shabby but structurally sound 1/2-bedroom homes, on a good street in an up-and-coming area, in a sweet spot like London’s Zone 2 near a Tube. Too fiddly to attract commercial investors, most private buyers get turned off by stale decor, and the market is spotty enough there are bargains at the edges. Find them with a ruthlessly critical eye. It’s not your house to live in, it’s your asset to sweat.

Let’s say costs are around £200k each. Allow a £40k deposit for each plus £20k for stamp duty and solid kitchen and bathroom refurbs, then approach mortgage vendors with your credit rating, income statements, and deposit. Spend two months refurbishing both. Use all the tricks – constant flooring throughout, lots of brilliant white paint, and little touches like making sure all lightswitches and sockets are the same type and free of paint flecks. (I’ve just done this to my own house and it raised the rentable value by £200 a month.)

Two mortgages of £160k carry repayments around £2200/mth. Renting the houses to young professionals brings in around £2600/mth, and capital appreciation another £20k on paper over the first year. Two primary goals are answered: you want capital growth that outpaces inflation (as London’s market is likely to do longterm) and loan repayments covered about 120%. You control a £420k portfolio that pays for itself and your £100k of initial capital has earned a 25% return on paper: you’re on your way.

Year Three: we’re in business.

You’re still saving. And it’s getting easier since you’re pulling in an extra £5k or so from rentals. By December there’s £40k to buy a third Buy-to-Let. (Let’s say it costs £210k.) Your first two properties add £20k to your equity during the year; your portfolio’s past £600k. And we’re just getting started. The biggest risk is to lose sight of the ten-year goal, sell up and splurge: Rule One is that these are long-term assets that grow over time, even while you’re driving a hatchback and watching basic satellite. If you have a surplus, use it to pay down mortage sums to increase your equity.

Year Four: do it again.

The prices are higher, but so are the rents you can extract. (One reason property works as an investment is that it builds in inflation: rents and capital appreciation tend to track.) At the end of the year the portfolio spans four properties and over £1m on paper; it’s producing a solid surplus of over £1000/mth in rent and in the next 12 months will rise £50k in value. The plan is starting to show concrete results. You need to look at tax planning here: your surplus of rental income over interest costs is now significant and the authorities look at this very, very closely. Be open, be honest, but explore all options for carried interest and remortgaging with your financial advisor.

Year Five: that sustainable vibe.

After another year, we’ve reached the halfway milestone: not portfolio size, but a self-sustaining buying strategy. The 40-50k to purchase each additional property is now mostly covered by rent yield: your portfolio is now pulling itself up by its own bootstraps. You’re using money to make money. Portfolio size: around £1.5m, with a third of it equity.

Year Six: the Long 15.

There’s a way to go, and on paper you’re less than 20% of the way there, but there’s a story behind the numbers. Your sixth purchase, taking price rises into account, puts your portfolio in the £2m range with free cashflow of over three grand a month. You’ve been working and earning a long time with few luxuries, but – hey – what are luxuries? The luxury to do what you want each day beholden to no-one: that’s luxury. And you’re better than halfway there.

Year Seven: getting lucky.

By the end of this year you’re at the point where the equity in your portfolio balances your remaining debt, at about a million each way. (If this sounds a lot, remember you’ve funded it to the tune of £350k or so out of your own pocket plus another £350k in reinvested rents: if you neglect capital appreciation for a moment, your return is less than 50% spread over seven years, not much better than a good savings bond.) Of course you DON’T neglect capital growth, which has been around £350k too, and 14% per annum taking it all into account is a far juicier average.

Year Eight: rolling in it.

With your mortgage repayments starting to bite into the capital sums you borrowed, the yield curve is looking good: you’re bringing in twice as much each month in rent payments as cost of capital, with your equity to debt ratio seeing two-to-one on the horizon and you’re comfortably a millionaire after liabilities.

Only one million? Yes – don’t forget tax. Britain has been good to you: it’s the UK’s strong institutions and stable government that gives investors and residents the confidence to come here, supporting your rental market and your capital appreciation. In most places in the world this can’t happen. Look at tax not as a cost, but as your contribution to civil society.

Year Nine: the end in sight.

Portfolio size: over £3.5m. Gross income over costs of over £10,000 every month, with over half your loans paid. With nine properties under your belt by year end, about as many as you’d want to handle working alone, it’s time to start planning the endgame: what you’re going to do in another year or so.

But it’s also time to start congratulating yourself: you may have deprived yourself of Lamborghinis and Breitlings, but let’s face it – they’re just stuff. You’ve probably discovered you don’t need them anyway. It’s time to give up work and concentrate on your portfolio.

Year Ten: the finish line.

No purchase this year, but your portfolio’s valued over £4m and the income allows you to pay down all remaining mortgage amounts. The tax implications here are  sizeable: make sure you make provision for all the tax… your contribution to the social stability that’s enabled your plan to work over the decade.

Outcome: you own £4m of net assets outright, plus a revenue stream of over a quarter of a million pounds a year: another £4m of Net Present Value right there. Over the next year, £250k of revenue plus a further £200k of capital appreciation give you a track record a larger scale investor will look at: an asset delivering stable returns close to £500,000/yr is the sort of thing pension funds get interested in.

All options are open now, from a straightfoward sale to exotic derivatives that securitise your assets and income streams. Remortgaging the lot gives you very high returns over costs (at least six percentage points) due to competitive loan rates now available to you. For the rest of your life, you can enjoy the returns associated with a £10m fortune while steadily accumulating an actual £10m in capital value. The work is done: your portfolio will climb to £10m over the next few years without further work. You’ve made it.

Of course, this plan assumes you find the right properties, capture the right lending deals, keep it rolling and disciplined over multi-year periods. But that’s the point. Not everyone can do it. And for people prepared to put in the work, research the market and sweat the small stuff… there are rewards.

The coming apocalypse: seven billion reasons

705px-Operation_Upshot-Knothole_-_Badger_001Some say I’m cynical. Actually I’m not: all I do is try harder than anyone else to see the world as it really is. Here’s the truth of it: I’m a happy person. I think the UK is the greatest place in the world to sleep soundly, build a business, or be a citizen in.

Which is why if I’m negative on tomorrow, it’s worth a shake.

And I am negative. Not for my personal situation, but for the world as a whole. Because I can’t stop thinking of where the megatrends are going. All the social and economic factors that collectively decide what’s going to happen seem to be pointing one way, and when the streams cross, there’s only one outcome.

We’re heading for another world war, on a 3-5yr timescale.

I’m not talking a regional conflict, or even the assymetries of Iraq and Afghanistan. I’m talking the Hundred Suns scenario, global thermonuclear war, toxic wastelands from Los Angeles to Leningrad and tribal affiliations co-opting civilisation. Consider the evidence… then consider how they interact when they all happen together.

nuclear-explosion1. Our unrepayable debt. The “rich” world owes approximately thirty-two trillion US dollars. And it’s expanding 1.7 percentage points faster than its economies are growing. Britain alone pays nearly a billion pounds a week in interest on its borrowings. You can’t pay back amounts like that in a New Normal of low growth. You can’t inflate it away, either. Not with households throttling back spending, companies hoarding cash, and central banks around the OECD keeping interest rates low. Our trillions of dollars, Euros, pounds and yen in debt are crushing us.

2. The attitudes preventing progress. Despite our debt, the West’s citizenry is clapping its hands over its ears – whole populations with a rising sense of entitlement on both sides of the Atlantic that everyone’s needs must be catered for, without limit, forever, paid from government coffers. (Who fills those coffers? Er, nobody much.) And they won’t vote for anyone who can solve it. Nobody wants to do the right thing, and a billion Westerners do nothing but stand around with their hands out and their mouths open.

3. China is peaking, not rising. It might seem unstoppable; in fact, the big red blot is already on a downward trend. All the IP-stealing, all the Fake Banks, all the new money – nothing there is sustainable or backed by real assets. The Communist Party took a gamble a couple of decades ago, betting they could keep the illusion going for enough years to bootstrap the country to real prosperity: it almost worked, but the West is getting wise to it, and its companies are starting to be recognised for the straw men they are. The tensions this is creating within China – mass unemployment, wealth inequalities, political impotence – will only have one result: a strike outwards by an uncontrolled military. All it’ll take is one sea captain to make an ill-advised landing on an island inside the fantastical nine-dash-line, and NATO gets dragged in. China is the flashpoint, and a billion Chinese will want someone to blame.

4. The Islamic assymetry. The Muslim Brotherhood – a more cohesive and on-message global organisation than Karl Rove’s Republicans in the Bush years – has quietly stepped into the chaos of the Arab Spring, and is putting its people into positions of power across the Arab world. But a day is coming when the West no longer needs the oil that finances our “real” enemies like Saudi Arabia. (The ultimate source of most terrorist financing and investment in mosques and madrassas staffed by imported imams who pour hate into frustrated youth all day, every day.) Meaning this quiet consolidation across the Ummah is happening without schools, without jobs, without prosperity to take the edge off their frustration and rage.  And the Muslim world will start to see extremists as the way out. Terrorism won’t be a few million fanatics, tacitly supported by a few hundred million sympathisers and opposed by the rest. We’re heading for one billion extremists, today’s assymetric war on terror multiplied a thousandfold, pushing political resources beyond reason. A billion Muslims will turn on us, and on each other.

mid-Greenhouse_George_Early_Fireball.ogv5. This angry Earth. Whether or not global warming is inevitable, cyclical, or chaotic, you can’t be pumping a billion tons of noxious gases into our atmosphere each year and expect any good to come of it. 80% of the world’s population lives near coasts; the majority of their homes are beneath the waves with just a few extra metres of sea level. (The amusing thing here is that it’s happened before; we conventionally think civilisation is just a few thousand years old, but there are coherent societal structures – cities – on the ocean floor over eighty thousand years old that used to be on the shores. The only reason this isn’t widely known is that historians aren’t generally scuba trained.) Pressure on the West to do the right thing, while the developing world has a license to keep doing wrong, creates no incentive for anyone to do anything, and a billion Africans who never caused it are already feeling the heat.

6. The end of the rains. There is no Peak Oil, but there is Peak Water. We’re drinking the deserts dry and desalination is too energy-intensive to replace freshwater sources; few cities outside the northern temperate zone are genuinely viable, and those that are are at risk of drowning in brine. Water is a scarce commodity, and billions in the South are already thirsty.

7. The fall of democracy. The compact between citizen and State is broken; with professional politicians inhabiting our Houses and psephology now so advanced a pollster can predict an election with 100% accuracy in every US State, politics is turning ever more polarised – concentrating on the extreme edges, the swing votes, only the few thousand people who can affect the result. The US Capitol is partisan beyond belief; younger democracies in Asia and Africa are just family and tribal businesses working under a pretext. Government has been co-opted by the fringes, and we can’t do anything about it.

When you take all these trends together, there’s only one logical conclusion: it won’t be a crash, but a war.

War is how China’s leaders will deflect attention from their failings. War is how the West will forget its debt. War is how the angry young men of the deserts will fill their time.

There won’t be ground invasions: there’ll be a few days of skirmishing, then someone in China will miscalculate and take it nuclear.

Then there will be blood.

Hundreds of millions will die. Billions more will suffer. Nations will dissolve; tribe will build wall against tribe; family will fight family. Packs of feral children will run naked in the toxic streets, and we shall hunt them for food. Society will be deleted, and there will be no Undo button.

atomic-blast-imagesSome regions may escape. There’s no obvious reason South America will be dragged in, but that continent is at risk of becoming one big narcostate anyway. Australia’s leaders may take the hard decision not to support NATO, and escape the nuclear carnage: Mad Max will tread the fallout everywhere but his homeland. India may go on being India, in all its chaotic complexity, although I expect Pakistan to take its chance once the birds are in the air. But for Europe, North America, the Middle East, and Northeast Asia, decimation is the only outcome.

And maybe – just maybe – it’s for the best. (And not just because a nuclear airburst is the most beautiful thing imaginable.)

We can’t inflate away our debt, stop China stealing, make Muslims respect us. We just can’t. As with every great crisis, the best solution may be to start over.

I’ll survive; probably even prosper, given the opportunities every great upheaval presents. (Chris Worth, Marketer to the Thames Valley Wasteland.) But I worry about the rest. Billions will suffer pain, all because we couldn’t make the few big decisions that really need taking.

Watch this space.

Circle: healthcare through a glass darkly

Sometimes, investing is really simple. You just look at the numbers, then look at the people.

My former client Circle‘s CEO resigned yesterday, and his statement – full of qualifiers about how “the board had agreed” – delivers a clear message that he was pushed. A few big numbers confirm why. I decided two years back Circle had no longterm future, but my concern now’s with the broader effect on private providers.

We’ve got to have more private provision of public services. But if Circle fails, the fat cats of Britain’s bloated public sector will think they’ve won.

Ali Parsa was actually a decent guy (for an investment banker) with a heroic personal story, and many of the people I worked with there were highly intelligent and qualified. People with a vision of private providers edging out inefficient public sector organisations, saving the NHS from itself. It was a good vision.

When Circle was my client, I poured in far more time and resources than they ever paid for. (Until I was pushed out by a rather odd newcomer, who herself lasted about a year I think.) I believed in the vision and enjoyed working on it. But what clinched Circle’s fate for me was the Hinchingbrooke contract: a £1bn poisoned chalice.

My opinion: Circle needed a big number on its balance sheet to keep investors hot. And £1bn is a big number. But Hinchingbrooke is a big hospital – far too big – and spread over ten years, £100m a year to keep it going with the capacities and commitments agreed didn’t look likely. As that’s become clear, the share price has been falling, hitting a nadir around a quarter of its launch price.

There’s nothing wrong with the vision. The issue for me was Circle’s culture. What it never had – in my opinion – was enough of “the boring stuff”.

What’s the boring stuff? Effective management structures and chains of responsibility, roles and resource planning and basic management accounting. Taking its traits from Parsa himself (as all companies do) it preferred a seat-of-the-pants, on-the-fly approach, resulting in vast energy going into minor decisions and an office culture that was more battlezone than bureau, clever people often taking decisions outside their expertise and projects withering on the vine whenever a Next Big Thing came along. Just like an investment bank. (I’ve had investment banks as clients, too, and what happened in them wasn’t so much people management as crowd control.)

It was chaotic… but everyone felt that if they’re working this hard, they must be achieving something.

And they did: Circle single-handedly shifted the debate on private provision of public services. (Like any organisation, the NHS has bloated over time. Far beyond Bevan’s remit, into a monster that thinks it can do everything, without the market mechanisms that tell you what’s useful.) With this news, I’m concerned it’s going to shift the debate again – back in the dastardly public sector’s favour. The union bosses are already crowing.

(An aside: have you seen UNISON’s office building? This supposedly public-service-inspired organisation has the most luxuriously appointed headquarters outside an African dictator’s gin palace. Nobody loves the trappings of wealth quite like a socialist.)

If Circle fails at Hinchingbrooke (the first NHS hospital to be taken over by a private provider) it means the public sector workers who hate private business will consider the case closed. Politicians will listen to them. And the debate will remain poisonous for decades. No private provider will be allowed to run public healthcare services again, and the NHS will keep sucking taxpayer funds into its gaping maw until it destroys us all. 

I’ve been mentally short Circle since Day One; knowing the company’s personality and finances, I thought – and still think – Hinchingbrooke will be the death of it. But I hope against hope it can succeed – because if Circle fails, the public sector will think they’ve won.

In praise of White Van Man

220px-White_vans_OxfordHe gets a lot of stick for his black-and-white politics. His attitude to the taxman is somewhat less than servile. And the way he drives earns a lot of ire. But I’m a big fan of White Van Man.

White Van Man is the working-class (stress working) male who spends much of his day in and around his vehicle. He’s the builder with your new front door in the back, the handyman hooking up your plumbing, the removals guy lugging your mattress across town for a quick fifty. He’s usually white, left school in his teens, and gets a bit lost on the finer points of Keynesian economics, yet he’s more cheerful (and more resourceful) than a senior manager at any FTSE-100 member. And that’s why I like him.

White Van Man is that freak of nature in today’s society: someone who doesn’t demand anything more than the most basic of safety nets from the government. He’s not a parasite, not even a socialist (although he may vote Labour.) He works hard, often for himself; his days start at dawn and his kids are often asleep by the time he gets home. But he doesn’t complain.

White Van Man pays his taxes. (Although perhaps a smaller percentage than the tax code strictly specifies.) But his needs aren’t high; he doesn’t march on Whitehall when his pay hasn’t risen in a year like Britain’s ultra-mollycoddled Public Sector drones. He wants a hospital for his parents, a school for his kids, maybe a house where the rent leaves a fiver left over for chips, and… that’s about it.

He doesn’t expect anything he hasn’t paid for – and he often pays more tax, more consistently than any other group. His earnings of £25-50k deliver around £5k a year to the Treasury and much more to the broader economy. Think about it: a self-employed builder putting up a conservatory a week increases the nation’s housing stock by a million pounds a year. A gift that keeps on giving for decades on our overcrowded island, even if you abhor those forests of uPVC wrapping Britain’s suburban brickwork.

And he keeps on doing it, in all weathers, in conditions most salaried workers would consider appalling.

Yet White Van Man doesn’t ask for much. He likes to watch the football, enjoy a beer, do his job with a minimum of hassle. And all he needs to do it is to be left alone. He wants the freedom to make the odd off-colour joke; to hold views offensive to some groups without being prosecuted for them; for the traffic cop to show a bit of understanding if it was an empty motorway in good weather.

He wants a bit of give and take, a bit of common sense to apply, without having to worry about a twenty-point Code of Conduct or densely worded contract. These opinionated, chain-smoking, sarcastic men are the backbone of Britain, if you treat them well.

I always let White Van Man out at busy junctions; after all, I’m on my way to a comfortable office, he’s got to make a one-hour delivery slot or his family goes hungry. I’ll add extra for a job well done and make sure they’ve got all the tea and biscuits they need. I won’t load extra tasks into the brief or be late for him, because all he wants out of life is to get home by 7 to watch Arsenal.

And beyond that, the resourcefulness of White Van Man means makes him a valuable friend. He’ll know someone who’s selling a fridge, or can tile your outside wall, or can get rid of that overhanging tree your neighbours complain about. (Or the neighbours themselves, depending on which part of town he’s from.)

That’s why I always try to make life a bit easier for White Van Man…. and why you should, too.