I'm ranting altogether too much over local "journalism", and this comment introduces nothing new to what I've posted many times before, but since the Advocate won't publish it:
Again I have to wonder why drivel produced by the seething hive mind of News Corp is being syndicated by my local newspaper. This opinion comes from somebody who appears to be innumerate (eight taxpayers out of ten doesn't necessarily - or even very likely - equal eight dollars out of every ten) economically illiterate, and empirically wrong.
Tax dollars do not fund welfare, or any other function of the federal government. Currency issuing governments create money when they spend and destroy money when they tax. "Will there be enough money?" is a nonsensical question when applied to the federal government. As Warren Mosler puts it, the government neither has nor does not have money. If you work for a living, it is in your interest that the government provides money for those who otherwise wouldn't have any, because they spend it - and quickly. Income support for the unemployed becomes income for the employed pretty much instantly. Cutting back on welfare payments means cutting back on business revenues.
And the claim that the "problem" of welfare is increasing in scale is just wrong. Last year's Household, Income, and Labour Dynamics in Australia (HILDA) report shows dependence on welfare payments by people of working age declining pretty consistently since the turn of the century. This opinion piece is pure class war propaganda. None of us can conceivably benefit in any way from pushing people into destitution in the moralistic belief that they must somehow deserve it.
The glaziers and carpenters have been busy these past few weeks and a new store is taking shape at Coffs Central.
[…]A leading Australia men's clothing brand, GazMan provides contemporary, casual and business attire for every occasion.
Men's polo shirts, chino pants, denim, knitwear sports jackets and business wear will line the about to be completed display racks.
Wow. Forget I.F. Stone or Seymour Hersch. If I'd just written a piece like this, I would have to consider hanging up my word processor for good. When it comes to local journalism, it really does not get much better than this. At the pinnacle of any profession it's all to easy to rest on one's laurels and say that there's nothing that one cannot do. It takes a special kind of crusading spirit to declare that there's nothing that one will not do.
This week, my academic performance has delivered a crushing blow to my self-confidence, so to reassure myself that I'm still capable of abstract thought, I have been mostly reading:
- Nature is priceless, which is why turning it into ‘natural capital’ is wrong — Bram Büscher and Robert Fletcher:
The move from nature to natural capital is problematic because it assumes that different forms of capital - human, financial, natural - can be made equivalent and exchanged. In practice - and despite proponents’s insistence to the contrary - this means that everything must potentially be expressed through a common, quantitative unit: money. But complex, qualitative, heterogeneous natures, as these same proponents acknowledge, can never adequately be represented in quantitative, homogenous money-units. […] Natural capital is therefore inherently anti-ecological and has little to do with giving value to nature, or rendering this value visible. It is the exploitation of nature to inject more value, and seeming legitimacy, into a faltering capitalist growth economy.
- The true cost of our insanely low Newstart allowance — Peter Martin:
This week, at the National Press Club, Social Services Minister Christian Porter dismissed suggestions that it needed to lift the Newstart unemployment benefit of just $264.35 per week. "The fact that people who find it challenging to subsist on Newstart do so for short periods of time might actually speak to the fact that that's one of the design points of the system," he said. The low rate was "working okay because the encouragement is there to move off those payments quickly".
- Reducing income inequality — Bill Mitchell:
[…] financial market deregulation provided capital with ‘all its Christmases at once! – it could have a higher profit share and suppress real wages growth and keep profits high by realising the increased sales and productivity improvements. How? The trick was found in the rise of so-called ‘financial engineering’, which pushed ever increasing debt onto the household and corporate sectors. The capitalists found that they could sustain purchasing power and receive a bonus along the way in the form of interest payments. This seemed to be a much better strategy than paying higher real wages.
- Why credit card interest rates are high — Peter Martin:
The best guess as to why most of us don't much care about rates comes from studies that find that alongside the sizeable proportion of the population that pays off its cards on time (and so doesn't care about rates) is a larger group of "deluded optimists" who believe they will pay their cards off on time. They're not concerned about rates either because they falsely believe they won't have to pay them. Psychological tests show the more likely people are to select cards with high rates, the more optimistic they are about all things.
The current system of knowledge dissemination isn’t working and Sci-Hub is merely a symptom of the problem — Iván Farías Pelcastre and Flor González Correa in the LSE Impact Blog:
Some scholars consider that, by removing barriers to access to knowledge, Sci-Hub is actually promoting the widest possible dissemination and use of academic research for the benefit of the entire scientific community. For instance, Masoud Shahnazar, Iran-based independent literary researcher, states that “we Iranians really owe [Sci-Hub] a lot” for providing access to the materials Iranian scholars require for their research. How researchers are able to access paywalled papers in a country faced with economic sanctions which prevent international payments is one of many questions that the current model cannot effectively answer.
- Time To Treat Bank CEOs Like Adults — Dean Baker in HuffPo:
Regardless of the exact motives, the real question is what will be the consequences for [Wells Fargo CEO John] Stumpf and other top executives. Thus far, he has been forced to stand before a Senate committee and look contrite for four hours. Stumpf stands to make $19 million this year in compensation. That’s almost $5 million for each hour of contrition. Millions of trouble-making high school students must be very jealous.
- Stupefied: How organisations enshrine collective stupidity and employees are rewarded for checking their brains at the office door — André Spicer in Aeon:
One well-known firm that Mats Alvesson and I studied for our book The Stupidity Paradox (2016) said it employed only the best and the brightest. When these smart new recruits arrived in the office, they expected great intellectual challenges. However, they quickly found themselves working long hours on ‘boring’ and ‘pointless’ routine work. After a few years of dull tasks, they hoped that they’d move on to more interesting things. But this did not happen. As they rose through the ranks, these ambitious young consultants realised that what was most important was not coming up with a well-thought-through solution. It was keeping clients happy with impressive PowerPoint shows. Those who did insist on carefully thinking through their client’s problems often found their ideas unwelcome. If they persisted in using their brains, they were often politely told that the office might not be the place for them.
Through trial and error Joel overcame a range of food intolerances which lead him to identify a niche in the market. Around one in four Australians suffer a food intolerance of some description and as a solution, Joel has developed a range of fresh, healthy meal choices that not only taste great, but also accommodate a wide range of common food intolerances.
One in four? According to whom? Any even mildly debilitating health problem suffered by 25% of the population is a major public health issue, not something to be solved by plucky food truck entrepreneurs. Actual medical research, as opposed to self-reported conviction, puts the figure at about one-tenth of that (eg. doi:10.1111/j.1365-2222.2008.03184.x), but let's not permit science to get in the way of a little entrepreneurship.
If you're going to make claims of medical efficacy based on "trial and error" and a sample size of one, why stop at one in four? Why not get into the diagnosis market and make that three in four? Coffs is hardly short of well-to-do cretins desperate to be cured of imaginary ailments.
Give me gluten-free flour, or give me death! I want to take my snake oil as a burger to go. Ooh, and a kale and chipboard smoothy. And a side order of those healing crystals. My spirit guide says they're delicious.
This week, I have been feeling guilty about skipping a month, and mostly reading:
- Why Do Anything? A Meditation on Procrastination — Costica Bradatan in the New York Times:
The drama of procrastination comes from its split nature. Just like the architect from Shiraz, the procrastinator is smitten by the perfect picture of that which is yet to be born; he falls under the spell of all that purity and splendor. What he is beholding is something whole, uncorrupted by time, untainted by the workings of a messed-up world. At the same time, though, the procrastinator is fully aware that all that has to go. No sooner does he get a glimpse of the perfection that precedes actualization than he is doomed to become part of the actualization process himself, to be the one who defaces the ideal and brings into the world a precarious copy, unlike the architect who saves it by burning the plans.
- China’s Army of Global Homebuyers Is Suddenly Short on Cash — Bloomberg News:
Less than a month after China announced fresh curbs on overseas payments, anecdotal reports from realtors, homeowners and developers suggest the restrictions are already weighing on the world’s biggest real estate buying spree. […] “If it’s too difficult, I’m out,’’ said Mr. Zheng, 66, a retired civil servant in Shanghai who declined to give his first name to avoid attracting regulatory scrutiny. He may abandon a 2.4 million yuan ($348,903) home purchase in western Melbourne, even after shelling out a 300,000 yuan deposit last August. He’s due to make another big payment next month.[Tick… tick… tick…]
- Why Trump's Staff Is Lying — Tyler Cowen, Bloomberg View:
By requiring subordinates to speak untruths, a leader can undercut their independent standing, including their standing with the public, with the media and with other members of the administration. That makes those individuals grow more dependent on the leader and less likely to mount independent rebellions against the structure of command. Promoting such chains of lies is a classic tactic when a leader distrusts his subordinates and expects to continue to distrust them in the future. Another reason for promoting lying is what economists sometimes call loyalty filters. If you want to ascertain if someone is truly loyal to you, ask them to do something outrageous or stupid. If they balk, then you know right away they aren’t fully with you.
- The Private Debt Crisis — Richard Vague:
When too high, private debt becomes a drag on economic growth. It chips away at the margin of growth trends. Though different researchers cite different levels, a growing body of research suggests that when private debt enters the range of 100 to 150 percent of GDP, it impedes economic growth. When private debt is high, consumers and businesses have to divert an increased portion of their income to paying interest and principal on that debt—and they spend and invest less as a result. That’s a very real part of what’s weighing on economic growth. After private debt reaches these high levels, it suppresses demand.
THE Real Estate Property Guide team stepped into a suburban oasis this week at Boambee East.
Unrealestate principal and selling agent Kerry Hines said the home is a true escape from the everyday grind.
"It has a central location, close to everything, yet it's almost a private oasis," she said.
"Close to everything"? I've lived in Boambee East and the isolation almost drove me mad. You are close to nothing except mile after mile of Colorbond fencing and hopeless despair. It's the country's largest open-air prison.
Walk the streets of an evening and I guarantee that before long you'll see a miserable middle aged man sitting alone on an upturned milk crate in his garage, listening to his Cold Chisel and Meatloaf records, over and over, and reaching into the carton on the floor beside him for another joyless can of rum and coke.
You'll also see the occasional old man or woman grimly pushing a walking frame down the middle of the road, because there are no footpaths, and in any case the grass verge is full of cars; the tiny prefab half-block houses necessitate using the garage as living space, and four or five car households are the average, because walking or public transport are out of the question, despite being so wonderfully "close to everything".
Kick the juice bottle bongs, empty opioid packs, and petrol cans out of your way, make sure the guy unconscious in a pool of urine is still breathing, and within an hour or two you'll get to the nearest pub. Recent renovations can't hide the fact that it's basically a livestock shed, optimised for slopping out rather than ambiance. In any case by the time you get there, they'll be stacking chairs and locking up.
So yes, a social, cultural, and intellectual desert is the perfect spot for a suburban oasis. Enjoy!
You have helped the workers by helping the company obtain a supervised repayment plan for the superannuation and taxes due to the ATO. Your assistance gave the company a chance to recover and for the workers to keep their jobs.
These two gentlemen tirelessly give, and give, and give, by… erm… not giving. But honestly, what employee would be so churlish as to refuse an extension of their Christmas holiday to February? Especially if about half of it might have been paid for.
The company has paid all wages through to 18 January 2017. This has been allocated and is being processed. The Australia day public holiday has delayed these payments being processed.
I am dismayed that a tiny contingent of Trotskyite entryists (they're everywhere, I tell you!) and chardonnay-sipping elitists in the press have dragged the reputation of this thriving concern through the mud - after everything that Mr Van Vliet and Mr Hartsukyer MP have done for the workers and their community.
Picture the day a delegation of grimy but loyal workers visited Mr Van Vliet's office in Malaysia, wringing their flat caps and begging "We just can't in all good conscience accept any more superannuation payment after all what you done for us. It's a crime that a gent like y'self should have to pay tax, an' all. Please go see Mr Hartsuyker, for we hear he's a kind man with a heart open to the struggles of the multinational CEO. There's no shame in that, sir!"
What nobody seems to realise is that it's not only Mr Van Vliet; there's a whole parent company with (according to Bloomberg) a whopping eight employees, ranging from himself all the way down to the lowliest Vice President. Just imagine them, weeping into their hotel pillows, and explaining to their professional companion for the evening how powerless they are in the face of the Australia Day public holiday!
I suggest the workers, duly chastened, should have a whip round and post a money order to Renewable Fuel Corp's Las Vegas mailing address. Include a note instructing Mr Van Vliet to go down the road and put it all on black. The first rule of the entrepreneur is never gamble with your own money.
Update 30/1/2017: Voluntary liquidation. You could have knocked me down with a feather.
This week, I have been plagued by self-doubt and mostly reading:
- Overt Monetary Financing – again — Bill Mitchell:
From the perspective of Modern Monetary Theory (MMT), a helicopter drop is equivalent to an increase in the fiscal deficit in the sense that new financial assets are created and the net worth of the non-government sector increases. It occurs when the government uses its currency-issuing capacity (linking treasury spending to central bank operations) without matching its deficit spending with debt-issues to the non-government sector. So the central bank adds some numbers to the treasury’s bank account to match its spending plans and in return may be given treasury bonds to an equivalent value. Instead of selling debt to the private sector, the treasury simply sells it to the central bank, which then creates new funds in return. This accounting smokescreen is, of course, unnecessary. The central bank doesn’t need the offsetting asset (government debt) given that it creates the currency ‘out of thin air’. So the swapping of public debt for account credits is just an accounting convention.
- We are not and never will be dependent on bond markets — Richard Murphy:
[…] no government need issue gilts at all. It has only been EU law that has required the UK to do so in recent years. It is that law which has prevented the government simply issuing new money instead at any time. […] far from investors doing the government a favour by investing in gilts the government does savers an enormous favour by letting them place funds on effective deposit at guaranteed fixed rates with the only deposit taker who will never default because they can always print more money to make sure that they will not do so. The government could, in effect, entirely avoid paying this interest but for the essential role that the government wants its bonds to play in certain key financial markets, such as the repo and pension sectors.
This week, I have been mostly reading:
- Stand, Fight, Resist — Jason Griffey:
Neutrality favors the powerful, and further marginalizes the marginalized. In the face of the current political climate, with the use of opinions as bludgeons and disinformation as the weapon of choice for manipulation and intellectual coercion, it is up to those who value fact and believe in the care of those in need to stand up and positively affirm that to do otherwise is evil.
- Going down the drain, putting this wondrous stock market at risk? — Wolf Richter:
Companies in the S&P 500 spent about $3 trillion since 2011 to buy back their own shares, often with borrowed money. It’s part of a noble magic called financial engineering, the simplest way to goose the all-important metric of earnings per share (by lowering the number of shares outstanding). And it creates buying pressure in the stock market that drives up share prices. […] “Only” 362 of the S&P 500 companies bought back shares in Q3, the second lowest number in three years, with Q2 having been the lowest number (blue line in the chart below).[And, not unrelated:]
- Apple CEO Tim Cook Met With Trump to “Engage” on Gigantic Corporate Tax Cut — Jon Schwarz, the Intercept:
Cook first described how it was critical for Apple to “engage” with governments on what he called “our key areas of focus.” According to Cook, these include “privacy and security, education,” “advocating for human rights for everyone,” “the environment and really combating climate change” and “creating jobs” — i.e., nothing as mundane as money. But in the third paragraph, Cook acknowledged, “We have other things that are more business-centric — like tax reform.”[And, tying it all together a few months ago:]
- Standing up to Apple — Robert Reich:
Congress’s last tax amnesty occurred in 2004, when global U.S. corporations brought back about $300 billion from overseas, and paid just a tax rate of 5.25 percent rather than the regular 35 percent U.S. corporate rate. Corporate executives argued then – as they argue now – that the amnesty would allow them to reinvest those earnings in America. The argument was baloney then and it’s baloney now. A study by the National Bureau of Economic Research found that 92 percent of the repatriated cash was used to pay for dividends, share buybacks or executive bonuses.
- James Galbraith Tells Us What Everyone Needs to Know About Inequality — Polly Cleveland reviews - well, quotes from - Jamie's new book at the D&S Blog:
Galbraith adds a new insight: not only did the postwar high-tax regime induce corporations to keep executive pay in check, it also induced them to retain profits and reinvest them in the corporation. With the 1980’s “greed is good” transformation, rates of reinvestment slowed as executives started taking more for themselves—surely helping slow the overall rate of growth.[i.e. for currency-issuing governments, the purpose of taxation isn't revenue-raising; it's about steering the economy toward desirable public policy ends.]
- A Chat (Avec Chat) — Wondermark, by David Malki !: