Sunday, 9 October 2016 - 5:49pm

Published by Matthew Davidson on Sun, 09/10/2016 - 5:49pm in

This week, I have been mostly reading:

  • Time to Kill Security Questions—or Answer Them With Lies — In Wired, Lily Hay Newman asks you to "please reset your mother's maiden name": The notion of using robust, random passwords has become all but mainstream—by now anyone with an inkling of security sense knows that “password1” and “1234567” aren’t doing them any favors. But even as password security improves, there’s something even more problematic that underlies them: security questions.
  • Billionaire: Chinese real estate is 'biggest bubble in history' — Jethro Mullen and Andrew Stevens, CNN Money [I wouldn't normally cite CNN, but it's worth it for the tl;dr. You can't avert a private-sector debt crisis without fiscal policy. Private sector deleveraging without public sector spending is a) unlikely, and b) suicidal.]: "The problem is the economy hasn't bottomed out," Wang said. "If we remove leverage too fast, the economy may suffer further. So we'll have to wait until the economy is back on the track of rebounding -- that's when we gradually reduce leverage and debts."
  • What’s So Bad about the Trade Deficit? — David Glasner reproduces a column he wrote in 1984, because we're still having the same misbegotten arguments: Just what is so dangerous about receiving more goods from foreigners than we give them back is never actually explained, but it is often suggested that that it causes a loss of American jobs. […] It almost seems tedious to do so, but it apparently still needs to be pointed out that buying less from foreigners means that they will buy less from us for the simple reason that they will have fewer dollars with which to purchase our products. […] Anyone who has ever thought about it has probably wondered why a country that gives up more goods in trade than it gets back is said to have a favorable balance of trade.
  • Anti-Intellectualism, Terrorism, and Elections in Contemporary Education: a Discussion with Noam Chomsky — an interview by Dan Falcone and Saul Isaacson in CounterPunch: I mean even before the Second World War Paris was one of the main centers of intellectual and cultural life. But now Paris is a kind of subsidiary of Germany, their traditional enemy and they can’t come to terms with it. They’ve tried to create one crazy thing after another to try to be exciting, each one more lunatic than the last, and this is one of them. And it’s picked up here in mostly literature departments and some humanities departments. It kind of gives the impression of being serious. Like you use big words and you have complicated sentences and there’s things nobody can understand, so we must be like physicists because I can’t understand them and they can’t understand me.
  • Chartalism and Stock-Flow Consistency: A Reply to Nick Rowe — Alexander X. Douglas: In a world of perfect certainty, there would be no need to accumulate dollars: people would spend all their dollars (or whatever currency) buying what they need today on the spot market and everything they need tomorrow on the forward market. Cue the requisite Keynes quotations about money as the barometer of uncertainty.
  • How Perfect Markets Concentrate Wealth and Strangle Growth and Prosperity — Steve Roth: The dynamics are straightforward here: poorer people spend a larger percentage of their income than richer people. So if less money is transferred to richer people (or more to poorer people), there’s more spending — so producers produce more (incentives matter), there’s more surplus from production, more income, more wealth…rinse and repeat.
  • Undercommoning within, against and beyond the university-as-such — the Undercommoning Collective have been reading Paulo Freire: We recognize that the university as it currently exists is part of an archipelago of social institutions of neoliberal, free-market racial capitalism. It includes the for-profit prison and the non-for-profit agency, the offshore army base and the offshore tax haven, the underfunded public and the elite private school, the migrant-worker staffed shop floor and the Wall Street trading floor, the factory and the factory farm. All are organs for sorting, exalting, exploiting, drilling, controlling and/or wasting what they call “human capital” and that we call our lives.
  • OECD joins the rush to fiscal expansion – for now at least — Bill Mitchell: In the last month or so, we have seen the IMF publish material that is critical of what they call neo-liberalism. They now claim that the sort of policies that the IMF and the OECD have championed for several decades have damaged the well-being of people and societies. They now advocate policy positions that are diametrically opposite their past recommendations (for example, in relation to capital controls). In the most recent OECD Economic Outlook we now read that their is an “urgent need” for fiscal expansion – for large-scale expenditure on public infrastructure and education – despite this organisation advocating the opposite policies at the height of the crisis. It is too early to say whether these ‘swallows’ constitute a break-down of the neo-liberal Groupthink that has dominated these institutions over the last several decades. But for now, we should welcome the change of position, albeit from elements within these institutions. They are now advocating policies that Modern Monetary Theory (MMT) proponents have consistently proposed throughout the crisis.
  • Public spaces are going private – and our cities will suffer — Harry Smith in the Conversation: Part of the explanation for this trend is that local authorities are increasingly using existing public spaces to raise funds, by charging for events or leasing their spaces to companies. In many cases, cash-strapped authorities are suffering from public sector cuts, and trying to improve or maintain their open spaces by entering into deals with private organisations.
  • National borders exist to pen poor people into reservations of poverty — Giles Fraser in the Guardian: We are so hypocritical about borders. We cheer when the Berlin Wall comes down. We condemn the Israelis for their separation barrier and Donald Trump for his ludicrous Mexican fence. But are we really so different? We also police our borders with guns and razor wire as if we had some God-given right to this particular stretch of land. Through the random lottery of life, I have a UK passport. I didn’t work for it or do anything whatsoever to deserve it. In economic terms, I just happened to be born lucky. […] It’s like our own little version of The Hunger Games. And it is so normal to us, we don’t even recognise it as a moral issue.
  • Why universal basic income is seizing the agenda — Richard Murphy in iNews: So why do it? There are many reasons. First, a lot (bit not all) of state benefits would roll over into the basic income and that would simplify the whole benefits system, saving a great deal. Second, work would always pay, but the tax rate when taking work and losing benefits would fall to a much more acceptable level, which would end the poverty trap that still ensnares far too many people in the current system.
  • Cutting Australia’s Corporate Income Tax: A Gift to the U.S. Treasury Department — Dean Baker for Crikey: One of the ironies of proposals to reduce Australia’s tax rate is that the U.S. Treasury would be a major beneficiary. The logic is straightforward, even if seldom advertised by proponents of the tax cut. Under tax treaties, the U.S. credits it multinationals with tax payments to the Australian government on a dollar for basis. This means that if a U.S. multinational has its Australian tax bill cut by $10 million then its U.S. tax bill likely increases by the same amount. The money saved by the company in Australia will go straight to the U.S. Treasury. [Okay, sectoral balances and all that: the money actually goes to the Fed, where it just redeems the liability incurred when the money was issued, and the Fed actually provides new money when Treasury spends. However the irony stands.]
  • Adjuncts are unionizing, but that won’t fix what’s wrong in higher education — Lisa Liberty Becker in the Washington Post: The Service Employees International Union (SEIU), also the force behind the Fight for 15 movement, has mobilized adjuncts in such spots as Washington, Boston and Los Angeles. During this past semester alone, according to the SEIU, adjuncts at 11 schools have ratified or agreed on union contracts. While there have been short-term gains, the deeper we become entrenched in adjunct unions, the more we are locked in an educational structure that shortchanges students by skimping on teaching.
  • Six thoughts on teaching — Richard Seymour: In a way, the teacher’s job isn’t to inform students of what they, ignorant little twits, don’t know. It is to place a different value on not-knowing. It is to enable students to make peace with the fact that not-knowing is the usual state of affairs.
  • Conquer Your Day With the Power of Breakfast! — in McSweeney’s Internet Tendency, Curtis Retherford makes me LOL, and a LOL from me does not come cheap, my friend: Breakfast. Breakfast stands alone. Breakfast is the most important meal of the day. It is the meal that fuels you for everything you encounter, that gets you ready for those important meetings. First thing in the morning, sit down and eat a bunch of eggs, and you will be able to tackle the day with confidence. You’ll be able to lean in to those who stand in your way and whisper softly in their ear, “my stomach is filled with eggs.” Their eyes will widen. They will not have realized that you have come prepared.
  • The Great British higher education sell-off — Ehsan Masood, openDemocracy: Private sector involvement in public services is now so mainstream it is surprising that it has taken so long for the market to meet higher education. But surprised we should be. The idea that we should be allowed to become rich from the education of present and future generations was a step too far even for Margaret Thatcher. Not so, however, for her successors.[…] I challenge any entrepreneur to read the research and HE bill, and not emerge feeling that you have struck oil. If these proposals become law, then, over time, the fee-paying student will become the human equivalent of black gold.
  • Let’s Get Fiscal — Bill Emmott (former editor-in-chief of The Economist) at Project Syndicate: In the inflation-plagued 1970s and 1980s, when investors’ demand for inflation-risk premia pushed up long-term borrowing costs, larger deficits tended to boost long-term interest rates further, while smaller deficits reduced them. It was this experience that caused policymakers after 2010 to assume that reducing government demand would help to boost private investment. […] But times have changed. For starters, we are no longer living in an inflationary era. On the contrary, Japan and some eurozone countries face deflation, while inflation in the UK is essentially zero. Only in America is inflation picking up – and only gently. Moreover, long-term borrowing costs are at historic lows, just as they have been throughout the last five years. Pursuing austerity in this context has resulted in a drag on growth so severe that not even the halving of energy prices over the last 18 months has overcome it.
  • ‘Chemophobia’ is irrational, harmful – and hard to break — Corey S Powell: In reality, ‘natural’ products are usually more chemically complicated than anything we can create in the lab. […] The distinction between natural and synthetic chemicals is not merely ambiguous, it is non-existent. The fact that an ingredient is synthetic does not automatically make it dangerous, and the fact that it is natural doesn’t make it safe. Botulinum, produced by bacteria that grow in honey, is more than 1.3 billion times as toxic as lead and is the reason why infants should never eat honey. A cup of apple seeds contains enough natural cyanide to kill an adult human.
  • Herstory, for Real — Ted Rall: Hillary Clintons probable victory in the Democratic presidential nomination is said to mark an important historical achievement for women. Certainly, she would become the first woman in the United States to be the nominee of a major party. From a broader historical vantage point, however, there's nothing novel about a woman marrying a powerful political leader and achieving power as a result, which is what happened in Clinton's case. It's time for the system to reward women who achieve power of their own accord.