The EU Outlaws “Woman Driver” Stereotypes

27.09.2017 • United Kingdom

Nick Hubble – Capital and Conflict (United Kingdom) –

This is one of my all-time favourites. The Telegraph’s Sam Meadows does a brilliant job of keeping his article about the EU’s ruling on car insurance fair and news-like.

But I couldn’t stop cackling. This is the best example of EU nincompoopery yet.

Five years ago, the EU ruled that car insurance companies were not allowed to charge men higher premiums based on their gender.

The idea that an insurance company cares about gender in and of itself is of course stupid. They care about things like the probability and cost of damage. Everything else is a proxy for figuring that out.

If they discover men are more likely to crash, drive more, drive more expensive vehicles, or some such factor, then applying a higher premium to men is basic risk management. It’s just what insurance companies do.

But the EU didn’t care about common sense or risk management. It banned the practice of using gender as the variable car insurance companies make their calculations on. Which of course solved and changed nothing.

Meadows explains that the gap between the premiums men and women pay has in fact grown since the directive.

John Miles from the insurance comparison site wins an award for his Sherlock Holmes style deductive reasoning skills:

“This is likely due to a number of factors, such as statistically higher accident rates for men and more men than women driving business and commercial vehicles – which are higher risk.

“The directive removed the ability of providers to give default discounts to women; however, the statistics and risk models used by insurers mean that the result is largely the same.”

Malcolm Tarling from the Association of British Insurers was also full of insightful comments that are painfully obvious:

“For motor insurance, factors such as the type of car, number of miles driven, driving record and claims experience will all impact on the cost of cover. Men and women are likely to drive different types of vehicle, do different mileage, and these variations, not gender pricing, will reflect in premiums.”

Who’d have thunk it, as one free market blogger likes to point out when the obvious reality smacks regulators on the back of the head.

This time, they really copped it

Surely whoever lobbied for this law was doing it tongue in cheek. It must’ve been a brilliant campaign. Taking on the old driving gender stereotypes and the absurd nature of regulation in one fell swoop. You can just imagine the horror or comedic disbelief of the lobbyist when the law actually passed.

The initiative tells you a lot about the nature of the EU and what keeps it busy. How much money did the regulation take to consider, pass and monitor?

The question is whether the British Parliament is as clueless, now we’re set to leave. It certainly seems to be when it comes to national finances, putting the entire nation at risk. If you haven’t already, you need to take a look at our horrific fiscal future and what to do about it.

The drama about EU insurance regulation makes you wonder what happens to all those variations on gender now available to people. Does becoming a man change your risk of a crash? At what point of the transition? Do you have to notify your insurer? Can it raise the price if you do?

And what about pregnancy? Are health insurers allowed to discriminate between men and women on the cost of maternity care – a major expense for women, but not men. Surely health insurance premiums shouldn’t reflect gender either.

I can’t wait to see the regulations on these issues of discrimination. Perhaps I’ll form a lobby group. The Transgender Driving and Pregnant Father Association.

There is a very serious side to this. What if all other forms of discrimination follow the same logic as car insurance?

What if companies aren’t actually sexist, but profit maximising?

What if women, immigrants and other groups are not discriminated against in the workplace because of their gender, but other economic factors?

Where does that leave our world of pointless regulation?

Germany turns to Jamaica

The German election is done and dusted. But nothing is clear.

At least the polls were right.

Angela Merkel’s party and her main competitor both reached 70-year lows in their share of the vote. There are now six parties with powerful shares of support. But somehow the chancellor can be labelled as the clear winner with only a third.

On an electoral map, Merkel’s hold on power certainly looks solid. But Germany’s electoral system is rather odd. Electorates are hardly important compared to the simple percentage vote. So even if she wins in an electorate, Merkel doesn’t just get the local member.

She now must get both the liberal Free Democrats (FDP) and the Greens party on board – traditional enemies. Her current coalition partner and closest competitor announced it preferred opposition. Why this announcement was so credible and not seen as a negotiation tactic is unclear.

Funnily enough, the various parties’ colours mean that Merkel’s black, the FDP’s yellow and the Greens’ green will leave Germany with a so-called Jamaica coalition. That could take quite some time to figure out. Perhaps Germany will join the Belgian and Dutch tradition of taking dozens of days to form government.

But the real story is the Alternative for Germany party, the AfD

Having dumped its founder, the party took a hard-right turn and focused on anti-immigration instead of euro-scepticism. Its clever posters featured “bikinis instead of burkas” and the like. The pitch certainly worked and it’s now the third biggest party in Germany!

But one day into parliament and the pair of leaders already had a major disagreement. It’s likely the AfD phenomenon is just a protest vote that will struggle to stick around.

However, it is concerning how extraordinarily high the AfD support is in isolated pockets of Germany. In former Eastern Germany, and especially around the eastern city of Leipzig, it got outright wins. As a West German by birth, the conclusion is clear and politically incorrect. The East Germans don’t like to share their West German subsidies with immigrants.

For Britain, the key question is whether the AfD continues to push its euro-scepticism, or if it has abandoned its founding intent completely. Having a pro-Brexit group inside each of Europe’s national parliaments will help negotiations by holding national leaders accountable. They cannot simply push pro-EU policies at the expense of local voters unopposed. That includes a vindictive treatment of Britain over Brexit.

From what I can tell, the AfD is barely euro-sceptic any longer. Even if Nigel Farage did show up to campaign.

However, the FDP might have the same effect

It’s vaguely Thatcherite and returned to relevance with this election. Given it’s needed to form power, and a historical partner of Merkel’s Christian Democratic Union (CDU), it looks like the FDP demands will have to be met by Merkel’s concessions. These could include some real thorns in the side of the EU, such as opposition to some of the reforms sought by Jean-Claude Juncker and French President Emmanuel Macron.

The sticking point in the Jamaica coalition is coal. Depending on who you ask, Merkel’s “energy turn” policy towards green power has been a disaster or a model example. The FDP argues that the shutdown of coal will simply lead to dirty energy imports.

That sounds fantastic for Britain given Cornwall and Devon are about to become energy powerhouses thanks to the invention of the steam engine mark 2.

Brexit negotiators will be watching the FDP’s demands closely. I will too.

Until next time,

Nick Hubble,
Capital & Conflict

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