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Tuesday, 28 June 2016 - 9:34pm

Published by Matthew Davidson on Tue, 28/06/2016 - 9:34pm in

The jewel in Coffs Harbour's cliche crown is still putting out the red light for any real estate agents in need of discreet, high-class services, after rejecting suggestions that a news story requires more than one source before it can be considered journalism.

The Advocate's advertorial editor-in-chief, Mr. Earnest Hardwicke-Goodge said he was disappointed by so many readers mystified as to why the unchanged ownership of prime CBD graffiti canvas was considered newsworthy.

"The continued presence of readers is a regrettable distraction from our core business of connecting advertisers with other sophisticated, consensual, like-minded advertisers," Mr. Hardwicke-Goodge said. "Unfortunately, despite filling any unsold advertorial space with the most unreadable tripe imaginable, we've been unable to shake them off."

Mr. Hardwicke-Goodge said that while an upcoming series of particularly nauseating stories of wholly uninspiring local people doing utterly unremarkable things had the potential to turn the situation around for the paper and it's key stakeholders, he urged any remaining would-be readers to remember one simple rule: "If you're not looking to scam or be scammed, just put the paper down and walk away; it's not for you."

Sunday, 26 June 2016 - 5:20pm

Published by Matthew Davidson on Sun, 26/06/2016 - 5:20pm in

This week, I have been mostly reading:

  • How Bernie Gives Hope for the Future — Ian Welsh provides a nuanced and pursuasive variant on the "nothing left to lose" argument for social change, to which I've never subscribed, but hey, you take your hope where you can get it: This is not the 2000s or 90s. This is not the age of compromise. The fruits of neoliberalism, neoconservatism, and oligarchy are being reaped; the youngsters have now grown up and never known a good economy. Many barely remember a time when the US wasn’t at war. […] The Democrats are the conservative party right now. They are about the status quo: Keep neo-liberaling, keep bombing and invading brown people’s countries, keep shoveling money to the rich. […] But Bernie lost in a genuinely hopeful way, showing that a socialist is now viable in the US and that young people are massively against the status quo.
  • On decriminalizing the sex trade — Chris Dillow: Here, though, is the thing. I – and I, strongly suspect, Mr Corbyn too – favour legalization of the sex industry in the context of other policies that empower women to reject exploitation. For me, these include full employment policies to give them other career possibilities; a mass housebuilding programme to reduce rents; and – of course - a basic income to improve their outside options.
  • What Will Many Bernie Sanders Voters Do After July? — Ralph Nader in Common Dreams: Here we go again. Every four years, the Democratic leaders define the Democratic candidate by how bad the Republicans are. This is designed to panic and mute their followers. Every four years, both parties become more corporatist. Sanders’ voters want to define the Democratic Party by how good it can be for the people. […] Where does this leave the Sanders people who see Hillary as experienced in waging wars, qualified as an entrenched pol, and realistic to suit the plutocracy’s tastes, and not really getting much of anything progressive done (alluding to the ways she has described herself)?
  • The trouble with getting the BBC to be less popular — David Mitchell, who—damn him—is still occasionally funny, in the Guardian: A report, commissioned by the Department for Culture, Media and Sport and published last week, argues that “greater distinctiveness” in the BBC’s output will allow its commercial rivals to make an extra £115m a year. […] Unfortunately the distinctiveness of a Hitchcock movie, a Lowry painting or a Cole Porter lyric doesn’t seem to be the sort the report is getting at, because that’s a kind people really like. That would be entirely counterproductive to its stated aims. By “distinctiveness”, the report means that the BBC should deliberately target smaller and more niche audiences, in order to allow the commercial sector to take the bigger ones. Its distinctive flavour would be less like chicken liver and more like calves’ brains. Because that would be fairer on the market place.
  • Paul Samuelson on Deficit Myths — L. Randall Wray at New Economic Perspectives: […] the need to balance the budget over some time period determined by the movements of celestial objects, or over the course of a business cycle is a myth, an old-fashioned religion. But that superstition is seen as necessary because if everyone realizes that government is not actually constrained by the necessity of balanced budgets, then it might spend “out of control”, taking too large a percent of the nation’s resources. Samuelson sees merit in that view. It is difficult not to agree with him. But what if the religious belief in budget balance makes it impossible to spend on the necessary scale to achieve the public purpose? […] We don’t need myths. We need more democracy, more understanding, and more transparency. We do need to constrain our leaders—but not through dysfunctional superstitions.
  • The Fed shouldn’t accept the “new normal” without a fight — Josh Bivens at the Economic Policy Institute: [A] key contributor to productivity growth is technological advance. This technological advance does not fall from the sky, rather it is the product of directed investment (R&D) and trial and error (workers learning by doing). When the pace of R&D investment is slow and output growth is slow enough to provide fewer opportunities for learning by doing, it is not shocking that technological advancement may slow. Further, there is ample evidence that firms boost labor-saving investments (which boost productivity) when labor costs are rising rapidly. Rapid labor cost growth has not been a feature of the recovery from the Great Recession. Between 2007 and 2014, real hourly pay for the median worker, for example, has slightly declined (see Table 1 here), and the share of corporate sector income accruing to capital owners rather than to employees reached historic highs. This labor market slack and weak wage growth has provided very little spur to boost productivity in the search for higher profits.
  • How negative-gearing changes can bring life back to eerily quiet suburbs — Kim Dovey in The Conversation: It is impossible to say how much this production of empty architecture is a function of negative gearing since it also goes hand-in-hand with neoliberal markets and high disparities of wealth. However, the curbing of negative gearing will have a significant impact in getting empty housing onto the market. This in turn could go some way to reversing this cycle of emptiness – bringing life to the shops, offices, streets, parks and public transport.
  • It's Time to Rid the DNC of DINOs, Starting With the Chair — by a gestalt creature called The Daily Take Team, from The Thom Hartmann Program: Jim Fouts, a three-term Independent mayor of Warren, Michigan, attended Sunday's Democratic debate, just like he had attended the Republican debate on Thursday. […] He told BuzzFeed News that he was seated behind Wasserman Schultz, and that he was praising Bernie's performance and talking about how this debate proved that more debates were a good idea for the Democrats. Then, during an early commercial break, Fouts and his assistant were taken out of their seats and the sergeant at arms told him, "The people that run this want you ejected, they don't want you here." Fouts was allowed to watch the rest of the debate from his seat, but he had to be careful about even clapping too loud or at the wrong time, for fear of getting ejected. […] Debbie Wasserman Schultz isn't the only Democrat-In-Name-Only (DINO) in the Democratic leadership. But as the DNC Chair, she is the highest-ranking DINO in the party. Tim Canova will take her seat in Congress, but Clinton is sure to give her a plum job elsewhere, for services rendered during the primaries.
  • On the results of the UK referendum — DiEM25: OUT won because the EU establishment have made it impossible, through their anti-democratic reign (not to mention the asphyxiation of weaker countries like Greece), for the people of Britain to imagine a democratic EU.
  • The American Fascist — Robert Reich: As did the early twentieth-century fascists, Trump is focusing his campaign on the angers of white working people who have been losing economic ground for years, and who are easy prey for demagogues seeking to build their own power by scapegoating others. […] As the Washington Post’s Jeff Guo has pointed out, Trump performs best in places where middle-aged whites are dying the fastest.
  • Whither Europe? The Modest Camp vs the Federalist Austerians — Yanis Varoufakis and James Galbraith: Soon after the Great Crisis of the Eurozone struck, Europe decided to treat it piecemeal – as though each affected country had committed separate and unrelated policy errors. The governing institutions of Europe denied that the difficulties of Greece, Ireland, Spain, Portugal and Italy could be part of a single disaster, spanning at once the realms of banking, public debt and investment.
  • Negative Gearing. It's turning us into a nation of landlords and serfs — Peter Martin: The great Australian dream meant owning your own home. "Getting ahead" means getting ahead of someone else. It's how Treasurer Scott Morrison sees the Australian dream. […] It's certainly what negative gearing is about. "The vast bulk of Australians who use negative gearing are just trying to get ahead and trying to get their family in a better position," Morrison says. But negative gearing only gets them ahead if prices climb. The more that people negatively gear in order to get ahead, the more prices climb. The further they climb, the harder houses become to buy. And the harder they become to buy, the more the Australian dream recedes.
  • Whittingdale is wrong: it is advertisers who are destroying the digital economy — Alexander Hanff in openDemocracy: Publishers feel like they have no control over the type of ads being forced on them by adtech companies and advertising agencies. This is a situation that needs to change – publishers should control all of the content they publish – including ads; and traditionally that was always the case. […] Advertisers and brands need to understand that their route to the audience is via the publishers whose content they are poisoning through invasive technologies and an ever increasing greed for more and more data. They need to purify the water before they can persuade us to start drinking it again – they need to stop tracking and profiling us, they need to better police their networks and platforms to eliminate malvertising and they need to yield control of the experience back to the publishers who own the audience. [Needless to say, we should object to being considered "owned" by publishers as well.]

Monday, 20 June 2016 - 9:44pm

Published by Matthew Davidson on Mon, 20/06/2016 - 9:44pm in

This confirms my long-held suspicion that Bellingen is really an extended episode of Father Ted.

"And you say the giant rock hasn't moved since? … Yes, I agree that is curious. … Well, I'm no giant rock expert, but I'd say that if it's got it into its head to stay where it is, you'll be wanting to undertake some processes - safe ones if at all possible. So it's on the left-hand side of the road - is that my left or your left? … Ah, the rock's left, of course. Right you are. Listen to me now; big eedjit!"

Sunday, 19 June 2016 - 9:29pm

Published by Matthew Davidson on Sun, 19/06/2016 - 9:29pm in

This week, I have been mostly reading:

  • Saturday Morning Breakfast Cereal (via Timothy Taylor):
  • The rise of Donald Trump — Dean Baker, Real World Economics Review Blog: Whatever the final outcome of the presidential race, Trump has exposed a sense of extreme anger among large segments of the population. These people are unhappy about economic policies that have undermined their financial security. Their anger may be misdirected towards immigrants or other countries, but it is not about to go away unless the policies change.
  • Larry Fink and His BlackRock Team Poised to Take Over Hillary Clinton’s Treasury Department — David Dayen at The Intercept: BlackRock is far from a household name, but it is the largest asset management firm in the world, controlling $4.6 trillion in investor funds — about a trillion dollars more than the annual federal budget, and five times the assets of Goldman Sachs. And Larry Fink, BlackRock’s CEO, has assembled a veritable shadow government full of former Treasury Department officials at his company. […] And his priorities appear to be so in sync with Clinton’s that it’s not entirely clear who shares whose agenda. Clinton, for her part, has refused to rule out a treasury secretary drawn from Wall Street.
  • Joe Wilson to Hillary Clinton in 2010: Baghdad “Has Been Bled to Death” — Zaid Jilani in The Intercept: My trip to Baghdad (September 6-11) has left me slack jawed. I have struggled to find the correct historical analogy to describe a vibrant, historically important Middle Eastern city being slowly bled to death. Berlin and Dresden in World War II were devastated but they and their populations were not subjected to seven years of occupation that included ethnic cleansing, segregation of people by religious identity, and untold violence perpetrated upon them by both military and private security services. […] The service people don’t see themselves there to bring peace, light, joy or even democracy to Iraq. They are there to kill the “camel jockeys.”
  • Why Trump? — George Lakoff: Language that fits [a conservative or progressive] worldview activates that worldview, strengthening it, while turning off the other worldview and weakening it. The more Trump’s views are discussed in the media, the more they are activated and the stronger they get, both in the minds of hardcore conservatives and in the minds of moderate progressives. This is true even if you are attacking Trump’s views. The reason is that negating a frame activates that frame, as I pointed out in the book Don’t Think of an Elephant! It doesn’t matter if you are promoting Trump or attacking Trump, you are helping Trump.
  • The Federal Reserve and the Global Fracture — Antti J. Ronkainen interviews Michael Hudson: The aim of lowering interest rates was to provide banks with cheap credit. The pretense was that banks might lend to help the economy get going again. But the Fed’s idea was simply to re-inflate the Bubble Economy. It aimed at restoring the value of the mortgages that banks had in their loan portfolios. The hope was that easy credit would spur new mortgage lending to bid housing prices back up – as if this would help the economy rather than simply raising the price of home ownership. […] Banks did make money, but not by lending into the “real” production and consumption economy. They mainly engaged in arbitrage and speculation, and lending to hedge funds and companies to buy their own stocks yielding higher dividend returns than the low interest rates that were available.
  • RICHARD KOO: The 'struggle between markets and central banks has only just begun' — David Scutt of Business Insider Australia points us towards this illustration of how trying to increase the amount of broad money by issuing base money is "pushing on a string":
    Nomura Koo
  • The Unemployment Rate Isn’t Used to Keep Unemployment Low (With Graph) — Ian Welsh: So, the unemployment rate from late 70s and on, has been used to determine if wages should cause inflation, and to then raise interest rates to make sure they don’t. Not incidentally, the result is also to crush wages, because, essentially, wages that improve are nothing more than wages that increase faster than non-wage inflation. The unemployment rate not only doesn’t measure how good the economy feels for ordinary people, it was actually used, with purposeful action, to crush wages.
  • There's more than one way to kill negative gearing — Peter Martin: Before John Howard halved the headline rate of capital gains tax at the turn of the century, negative gearing was relatively unattractive. Landlords as a group made money. In 1999-2000 they made a combined $219 million. Ever since then they've lost money. In 2012-13 they lost a net $5.4 billion... Capital gains matter because they are the mechanism negative gearers use to make money. The profits they make from eventually selling their properties are meant to exceed their annual losses from rent. A cut-rate capital gains tax makes those profits more likely. Investors can write off their annual losses at the full tax rate and pay tax on their eventual profits at only half the rate.
  • Exit Planning — Thomas Geoghegan in The Baffler: Toe-to-toe, it’s the elderly and not the robots who are taking jobs from the young. […] The more we shrink the welfare state—I mean cut back on private pensions, Social Security, and Medicare so that older Americans must stay in the workforce—the harder it is for a young person to land a job. D.C. think tanks love to tell the elderly that we’re really in fine shape and that it is our duty to keep on working. To an audience of older college grads, like me, they say, “Hang on to those college-type jobs.” At the same time, they push more young people into college. Isn’t this a contradiction? It seems that the one hand does not know what the other hand is doing. That’s the problem with neoliberalism.

Friday, 17 June 2016 - 8:43pm

Published by Matthew Davidson on Fri, 17/06/2016 - 8:43pm in

I briefly considered doing a Cat Stevens act, but it's such a crowded market. And the turf wars are brutal. I mentioned I was thinking about it to Steve Moonshadow and he savagely lashed out, giving me the most horrendous swollen black eye, saying "Come anywhere near my patch, and I'll do the other one, then you won't have to look no more. Understand?".

Anyway, you really need to go niche to make an impact. I thought maybe James Taylor, Donovan, even Mary Hopkin (promising, but I just couldn't make the blonde wig work).

Finally, I hit on the perfect, under-exploited formula. You can catch "Turned Out Nice Again - A Moving Homage to George Formby" during my 2016 east coast tour, starting in Grafton and ending slightly north of Grafton. Check local pubs, community theatres, and scout halls for dates and times. Celebrate the life and work of a man who has united generations around the simple pleasures of flat caps, ukuleles, leaning on lampposts and appreciating the occasional little stick of Blackpool rock. Who knows - you might see what I can see, when I'm cleaning windows!

Friday, 17 June 2016 - 6:09pm

Published by Matthew Davidson on Fri, 17/06/2016 - 6:09pm in

Ha! We stride boldly into a vision of the future from the 1970s. More roads! More cars! More shopping malls! More dormitory suburbs! Knock it all down, and if you can't knock it down, knock something else down to bypass it!

Soon the current plague of property investors will pass, leaving ghost malls sitting alongside the ghost arcades of a previous plague. A home for tattoo parlours, the ever-expanding offices of the privatised dole police, and placards proclaiming "This space for rent" and "Vote Hartsuyker".

Tuesday, 14 June 2016 - 12:24pm

Published by Matthew Davidson on Tue, 14/06/2016 - 12:24pm in

If there's one thing you can say about Coffs, it's that it's never afraid to build on its weaknesses. Our local university campus dropped it's Bachelor of Arts course three years ago to make room for an expanded range of business studies courses (on this at least I'm not kidding). We're celebrated as the region with the highest per capita concentration of Elvis impersonators, and the home of "Ain'tmusic: the Original Australian Adam and the Ants (and Tears for Fears) Tribute Show". And the local thigh slappers and scenery chewers collective is currently rehearsing "Rocky Horror Get Your Gun!" The combination of suburban sprawl and inadequate public transport means that for most of the population an evening out involves sitting on an upturned milk crate in the garage listening to Cold Chisel records, gulping rum and coke from a can, and wondering where it all started going so wrong.

I can save us some consultancy money and and deliver a report on the viability of a new performing arts centre right now: There is  none. Anybody in Coffs interested in seriously pursuing the arts has already left. A performing arts centre will, in approximately three years, be hollowed out and refitted as the new expanded headquarters for one of our flourishing Job Services providers. We might as well consider the viability of establishing a space exploration program.

Sunday, 12 June 2016 - 7:54pm

Published by Matthew Davidson on Sun, 12/06/2016 - 7:54pm in

This week, I have been mostly reading:

  • So Sue Them: What We’ve Learned About the Debt Collection Lawsuit Machine — Paul Kiel, ProPublica: In 1996, there were around 500 court judgments in New Jersey from suits filed by debt buyers. By 2008, that number had reached 140,000. […] For the most part, debt buyers purchase defaulted credit card accounts, typically for a few pennies on the dollar. Starting in the late 90’s, the industry began a period of rapid growth and then exploded in the middle of the last decade. That led to a sharp spike in suits, many of them by smaller debt buying companies that have since gone out of business. The industry is now dominated by several large companies.
  • Hey Joe, banks can’t lend out reserves — Steve Keen: For me, watching academic economists and Central Bankers (the vast majority of whom trained as economists) tell the banks to “lend your excess reserves to the public, dammit!”, is akin to watching some delusional person in a playground watching two kids playing on a see-saw, and criticising them because they weren’t both up in the air at the same time.
  • The Barbarism of Donald Trump — Ian Welsh: I don’t know if Clinton will torture. I know Bernie Sanders won’t. I know there are options available in the American election that don’t sell the tattered remains of America’s soul.
  • Corbyn's Progress — Tariq Ali: Blair, angered by this outburst of democracy in a party that he had moulded in his own image, declared that the Labour Party would be unelectable unless Corbyn was removed. Brown kept relatively quiet, perhaps because he was busy negotiating his very own private finance initiative with the investment firm Pimco (Ben Bernanke and the former ECB president Jean-Claude Trichet are also joining its ‘global advisory board’). Simultaneously, his ennobled former chancellor, Lord Darling, was on his way to work for Morgan Stanley in Wall Street. Blair, an adviser to J.P. Morgan since 2008, must have chuckled. At last, a New Labour reunion in the land of the free. All that ‘light-touch’ regulation was bearing rich fruit. Virtually every senior member of the Blair and Brown cabinets went to work for a corporation that had benefited from their policies.
  • Folks Worried About Robots Taking Our Jobs Need to Learn Arithmetic — Dean Baker: It is important to recognize that “owning robots” is a political issue, not an economic one. Specifically, people own robots because we give them patent monopolies. In most cases robots would be very cheap to produce if the government didn’t threaten to arrest people for not respecting patents. […] So we end up with money going from the rest of us to people who own robots because the government has given these people a monopoly over the use of the technology. Suppose the government didn’t give a monopoly over the use of the technology. Suppose that we funded the research through a different mechanism or at least made the monopolies shorter and weaker. Then the folks who developed the robots would not have so much money, the robots would be cheaper, and the rest of us would be richer.
  • MMT, trade balance and balance of payments — Mike Norman: A net importer is gaining "stuff" in an exchange with a net exporter, and the net exporter is accumulating the currency of the net importer. Thus the net importer is benefiting in real terms while the next exporter is benefiting in financial terms. The net exporter is diminishing domestic product (real) for domestic use, and the net importer is increasing indebtedness (financial) to the net exporter. On the other hand, net imports are beneficial to the economy and nation at full employment. The nation has more stuff than it would otherwise have at the current level of productivity. Because foreign workers are contributing to domestic productivity. And the country is not exporting jobs.
  • Saturday Morning Breakfast Cereal:
  • Listening to past Treasurers is a dangerous past-time — Bill Mitchell: On January 23, 2016, a former Australian Treasurer Peter Costello (1996-2007) gave a speech to the Young Liberals (the youth movement of the conservative party in Australia) – Balanced Budgets as a Youth Policy – which was sad in the sense that some people never get over being dumped as out of touch and unpopular and was ridiculous in the sense that it is a denial of reality and macroeconomic understanding. He mounted the same old arguments that have been used to justify the pursuit of fiscal surpluses (grandchildren etc) but failed to recognise that his period as Treasurer was abnormal in terms of our history and left the nation exposed to the GFC as a result of the massive buildup in private sector debt over his period of tenure. The only reason he achieved the surpluses was because growth was driven by the household credit binge which ultimately proved to be unsustainable. Fiscal deficits are historically normal and should not be resisted. They are the mirror image in a national accounting sense of non-government surpluses, which historically, have proven to be the best basis for sustained growth and low unemployment.
  • Tilting at windmills: The Faustian folly of quantitative easing — Steve Keen, Real World Economics Review Blog: QE gets into the money supply—not via lending, which is impossible, but via asset purchases, which far and away benefit rich households more than poor ones. Rich households also benefit from the income the share transactions generate. And finally, some of that money gets to poor households when the rich ones—made richer still by QE—buy some services off them. The real economy has thus received some impetus from QE, but only a relatively trivial amount of the money created has got into circulation in Main Street. As Michael Hudson puts it, Bernanke’s helicopter dumped money on Wall Street, not Main Street. The bubble before the financial crisis had already exaggerated income inequality past what is sustainable in a capitalist society. Central Bank meddling via QE has made this problem worse, and without the illusion of a boom (like the Internet and Subprime Bubbles) to make it seem somehow palatable. And Neil Wilson adds some more context, though I must admit that I couldn't follow his logic for one crucial step.
  • Bernie Sanders proved politicians can make it this far without selling their souls — Robert Reich in the Guardian: Sanders’ courage in taking on the political establishment has emboldened millions to stand up and demand our voices be heard. Regardless of what Sanders decides to do now, he has ignited a movement that will fight onward. We will fight to put more progressives into the House and Senate. We will fight at the state level. We will organize for the 2020 presidential election. We will not succumb to cynicism. We are in it for the long haul. We will never give up.
  • We are being led by imbeciles — Bill Mitchell: I was reading John Maynard Keynes recently – circa 1928 – that is, 8 years before the publication of the General Theory with his Treatise on Money intervening. He was railing against the principles and practice of ‘sound finance’, which he noted had deliberately caused billions of pounds in lost income for the British economy. He urged the Treasury and the Bank of England to abandon their conservative (austerity) approach to the economy and, instead, embark on wide-scale fiscal stimulus to create jobs and prosperity. He concluded that with thousands of workers idling away in mass unemployment that it was “utterly imbecile to say that we cannot afford” to stimulate employment via large-scale public works – building infrastructure etc. He considered the policy makers who opposed such options were caught up in “the delirium of mental confusion”. The stark reality is that 88 years later, he could have written exactly the same article and would have been ‘right on the money’.
  • Why I don't use heroin — Chris Arnade, The Guardian: Addiction is a symptom of something very wrong with our society. That in any city or town, across all of America, people live on the streets, shooting up, selling themselves for another bag, should make us all stop and ask ourselves “why does our society create and allow such pain?”.

Saturday, 11 June 2016 - 6:44pm

Published by Matthew Davidson on Sat, 11/06/2016 - 6:44pm in

"Once you get to beach if you have any doubt about your abilities in the conditions it is best not to go out."

Are you mad? Is there any statement that could possibly do more to persuade the country's idiots that they must flock to the beach in order to demonstrate that they have absolutely NO doubt about their ability to handle ANY conditions.

"I know you weren't intending to go to the beach, and it is winter, so there's no reason for anybody to think any less of you, or call you a wuss, if you opt not to take on these challenging conditions. Not everybody is made for challenging conditions. Don't shoot the messenger; I'm just alerting you to the fact that the challenging conditions are there, and you're not. I'm not insinuating anything. In fact I stood up for you when the other guys were having a go at you. I said you were more sensitive, and that we should respect and cherish that. So, please, you do what makes you special tomorrow, while we're out there, in challenging conditions."

Sunday, 5 June 2016 - 8:25am

Published by Matthew Davidson on Sun, 05/06/2016 - 8:25am in

This week, I have been mostly reading:

  • Wall Street’s Message to Young Adults: “You are Clueless” — Bill Black at NEP elicits a LOL: Wall Street CEOs are very upset with young adults. They believe you are “clueless” and “voting against [your] own interests” when you support Bernie Sanders. A Wall Street CEO took to the pages of the Wall Street Journal to decry the fact that “Millennials are flocking to Sanders.” It would be cruel to note that one has to be clueless to believe that writing an op ed in the WSJ was a good way to reach millennials supporting Bernie.
  • Dear Paul — Gerald Friedman (Context here): While you don’t know me, you seem to feel free to speculate about my values and interests. You assume that an outsider economist like myself must be considered not particularly “insightful or even technically competent.” And, elaborating this theory, you conclude that envy would lead me to jump on an opportunity for self-advancement by shilling for an outsider politician. Now this theory might be tested empirically. You could easily have tested your theory by investigating my motives empirically. You could have called me and asked. Or you could have read any of the news stories where I explained how I stumbled on this research project, and where I explained my (lack of) connection to the Sanders campaign. Krugman's continuing public self-immolation is baffling.
  • Saturday Morning Breakfast Cereal:
  • Who are the capitalists? — David F. Ruccio: It’s one of the questions I ask my students. And they always get the answer wrong. So, in my experience, do most other people. But it’s a key issue. If we’re going to figure out how capitalism works—and, perhaps even more important, how to change it—we need to know who the capitalists are.
  • Surprised by the rise of Bernie Sanders and Jeremy Corbyn? Then you need to get out more — Simon Wren-Lewis: Political commentators talk to politicians who talk to political commentators. It tells us how embedded the influence of the City and Wall Street is. The media relies on economists from the financial sector, and so tends to see the economy from their perspective. The blind spot is mostly to the left, because we have the Daily Mail and Fox News. As a result, it came as a complete surprise that a crisis caused by the financial sector that left that sector unscathed but instead led to a diminished role for the state, might make many people rather angry.
  • Robert Samuelson Is Unhappy that We Have Evidence Based Economics — Dean Baker at CEPR: There are still millions of unemployed or underemployed workers who would like full-time jobs. This means that the concern about balanced budgets is needlessly keeping these people unemployed. And the weakness of the labor market is keeping tens of millions of workers from having the bargaining power necessary to get their share of the benefits from economic growth in higher wages. Perhaps even worse, the obsession with deficits prevents us from doing things we really need to do. The neglected items form a long list, from early childhood education and affordable college to keeping the kids in Flint from being poisoned.
  • Australia’s Housing Bubble: In the Grip of Insanity — Pater Tenebrarum, who appears to be some kind of gold bug, but as the link comes via Naked Capitalism, and I agree with the conclusion, I'm prepared to overlook the tinfoil hat: In this particular case, the boom has already progressed to a rare extreme: with home prices at 10 to 12 times disposable income (far higher than the peaks attained in the housing bubbles in the US, Ireland and Spain), the end is clearly getting close. Australian home-owners, property investors and banks will be in for quite a rude awakening.
  • How to Explain the Sanders Campaign to an Idiot, Paul Krugman or a Clintonite in 8 Sentences — Seth Abramson in the Huffington Post: Bernie Sanders […] is staying in the race because all the extant hard data suggests he is a stronger general election candidate than Mrs. Clinton, because he passionately believes the Democrats must defeat Donald Trump in the fall, and because Mrs. Clinton’s stunning failure to secure 59 percent of pledged delegates didn’t merely invite but indeed encouraged him to take his case to superdelegates in July […] The Democratic Party has never, in modern history, run a candidate with an unfavorable rating as high as Mrs. Clinton’s […] Sanders plans to continue his campaign in the hope of saving Democratic elders from their slavish devotion to a political dynasty that’s turned the Party from its New Deal roots toward a neoliberal corporatism now destroying the middle class.
  • Waist deep in the Big Muddy — John Quiggin: The sudden collapse of four for-profit vocational education enterprises including Aspire college is the latest in a string of scandals, failures and license revocations in the sector. […] The provision of public funds to for-profit operators has been a predictable, and predicted disaster. Of all the disasters perpetrated under the banner of microeconomic reform, education reform has probably been the worst.
  • Morrison's tax swap would have taken from the poor and given to the rich — Peter Martin: The most shocking thing in the Treasury analysis delivered to Scott Morrison on January 25 isn't the finding that a cut in income tax funded by a lift in the goods and services tax wouldn't boost the economy at all. It's what Morrison asked the Treasury to model. He asked it to model a lift in GST from 10 to 15 per cent and then the handing back of every possible cent in income tax cuts. Because boosting the GST automatically results in extra spending on benefits such as Newstart, family allowances and pensions as prices climb it isn't possible to give all of it back. But it is possible to hand back $30 billion of the $35 billion as tax cuts, and that's what Morrison asked the Treasury to model in the first instance, not legislated increases in benefits of the kind delivered by his predecessor Peter Costello when introducing the GST. The impact is horrific.
  • To Fix Inequality and Steady the Economy, Think Radically — Lynn Parramore at INET interviews Adair Turner: […] for the decade leading up to 2007, a whole lot of people who weren’t getting raises felt that they were doing ok because they managed to buy a house that was going up in price. But it all came to and end, a catastrophic end. Rising inequality can create a more highly leveraged economy, and it can then make the economy vulnerable to a crash like 2008. And in that crash, the really malign thing is that the crash itself tends to further increase inequality because it tends to be the people at the lower end of the wealth distribution who were highly leveraged and had to borrow lots of money to buy their house. In the downswing, they lose all the wealth they’ve got.

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