Economics

Putting predictions to the test

Published by Anonymous (not verified) on Sun, 17/09/2017 - 7:58pm in

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Economics

It is the somewhat gratifying lesson of Philip Tetlock’s new book that people who make prediction their business — people who appear as experts on television, get quoted in newspaper articles, advise governments and businesses, and participate in punditry roundtables — are no better than the rest of us. When they’re wrong, they’re rarely held […]

Economic growth and gender

Published by Anonymous (not verified) on Sun, 17/09/2017 - 1:59am in

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Economics

The economic implications of gender discrimination are most serious. To deny women is to deprive a country of labor​ and talent, but — even worse — to undermine the drive to achievement of boys and men. One cannot rear young people in such wise that half of them think themselves superior by biology, without dulling […]

Risk and uncertainty: why gilts can be seriously overvalued

Published by Anonymous (not verified) on Sun, 17/09/2017 - 12:42am in

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Economics

I wrote what I thought to be an entirely reasonable blog yesterday on why I think the next financial crisis will be more serious than the last, and a host of people who have never appeared in the comments section of this blog before I did so poured in to tell me how wrong I am.

To be precise, they without exception objected to the suggestion within the chart that I reproduced from Prof Daniel Mugge, who is Professor of Political Arithmetic at the University of Amsterdam, that UK gilts are overvalued. If you want to know what political arithmetic is, his explanation is available by following the last link, from which the most telling phrase in the current context may be this:

[W]hen branches of government publish evidence, either to assess past policies or to devise new ones, we demand that they not be colored already. But they inevitably are colored, consciously or otherwise. This applies most immediately to quantitative indicators, and especially to those that are so ubiquitous that we take them for granted: inflation gauges, GDP, unemployment figures, trade statistics, government debt levels. After all, measuring abstract economic quantities is never straightforward, and the choice for one formula over the other carries implications that are rarely understood beyond a narrow circle of experts and communicated to the wider public.

I have not asked Daniel if he approved of what I’d written, but we’ve mailed since and he raised no issue. He retweeted the blog post. I am guessing he is not taking issue. And I can guess as to why that is. What his work looks at is, amongst other things, the way false perceptions of data can be used to create misunderstanding for political advantage.

I respectfully suggest to those making comment that they are guilty of a number of things. First, they ignored most of my blog. I did not discuss overvaluation of gilts in isolation; I discussed it as part of a phenomenon of over valuation that is likely to correct. I was not, then, discussing a microeconomic phenomenon of whether or not a particular formula applied at a point in time or not  but was instead considering what might happen to gilt valuation in the event of what I called a discontinuity. This idea of a discontinuity seems to be a possibility beyond the comprehension of those commenting. In their world it would seem crashes do not happen, but even if they do, they are always self correcting (hence their obsession with simultaneous liability restatement to match asset price changes). Unlike them I live in a world where crashes do occur, with consequences. It’s called the real one. So do they, for the record, but they seem intent on pretending otherwise.

Second, they believe their models. As one commentator said:

Gilts are defined by nominal, coupon and redemption date. Valuation is determined by discounted cash flow against the yield curve alongside the perceived certainty that the payments will be received i.e. they will not default.

Another invited me to use a spreadsheet, which, he claimed would prove that he was right. And I have to tell him, they won’t.

So reluctantly I have to explain why that is the case: I say reluctantly only because I would have thought the world would have learned this stuff by now but it seems it has not, meaning that the odds of another crisis both occurring and having worse consequences than last time move from near certainty in my estimation to absolute certainty, precisely because the lessons of 2008 have very obviously not been understood by those who think they know finance.

Those lessons were succinctly summarised by Adair Turner  in his 2009 report on the financial crisis (para 1.4):

At the core of these assumptions has been the theory of efficient and rational markets. Five propositions with implications for regulatory approach have followed:

(i) Market prices are good indicators of rationally evaluated economic value.

(ii) The development of securitised credit, since based on the creation of new and more liquid markets, has improved both allocative efficiency and financial stability.

(iii) The risk characteristics of financial markets can be inferred from mathematical analysis, delivering robust quantitative measures of trading risk.

(iv) Market discipline can be used as an effective tool in constraining harmful risk taking.

(v) Financial innovation can be assumed to be beneficial since market competition would winnow out any innovations which did not deliver value added.

Each of these assumptions is now subject to extensive challenge on both theoretical and empirical grounds, with potential implications for the appropriate design of regulation and for the role of regulatory authorities.

In other words, standard capital asset pricing models do not work.

That said, I have already seen the responses on the blog saying this is not true of gilts, even if it is of other assets. The logic is that because UK gilts cannot fail (a point on which I agree) they are risk free meaning that the factors incorrectly appraised in 2008 cannot recur in the gilt markets now. Ignoring for a minute that this suggests that all commentators appear to agree with my contention on other asset values (and I am taking that as read because no one has said otherwise) let me still address the issue of gilt valuation and why that too may be incorrect.

What the commentators are assuming is that they can correctly appraise risk. That is because they think there is only risk with regard to gilt returns. This is implicit in the comment that we only need to know nominal, coupon, the redemption rate and the yield curve. In isolation, and at a point in time, that model works in isolation.

I stress though it works to produce a current value, not an actual value. Tomorrow’s value may be quite different, of course, using the very same model. But  I am sure those commenting use this system day in and day out to trade vast sums and extract a rent from society for doing so, believing that they are incredibly clever for doing so when all they actually do is arbitrage that daily difference in perception which their model cannot value at a point in time because it, quite literally, discounts it, which is the flaw at its very heart.

But the reality is (and why do I still have to point this out?) that we do not live in a risky world, which is what this model assumes; we live in an uncertain one, even when it comes to gilts. And that is why this model is wrong.

This difference between risk and uncertainty is fundamental, but seemingly unknown to my commentators, just as it was to Adair Turner, as he has readily admitted it was to him and most of the City pre-2008. Risk means we can attach a probability to an event. In fact, not only can we attach a probability to an event, but we can even attach a probability to when an event might happen. So, in gilt terms, the only variable that the commentators thinks of consequence is if there is an interest rate change and when, and both these can be predicted and so priced, hence their apparent certainty.

Uncertainty on the other hand means we simply do not know what will happen. A probability cannot be attached to an  uncertain event. We do not know what will happen, or when, and what the consequence might be. We can guess, but we will be wrong. No amount of modelling can deal with the uncertainty: the future of uncertain events is not known.

My first contention is that a discontinuity – a disruption resulting from a financial crisis – creates uncertain consequences, even for gilts. My second – which I will come to – is that the consequences of uncertainty need time to play out. As a result, I argue gilt revaluation can be created by the type of crisis three of us predicted on Thursday.

Let me deal with two issues in turn. First, I am presuming for reasons already noted that those commenting accept that it is possible that stock market, property, personal and mortgage debt valuations on bank balance sheets, corporate debt, and derivatives based on all these things, appear over-valued at present. We can broadly argue that this is the result of misguided use of QE: I argued that this would happen in 2010  meaning I have some form in this area. In that case let’s assume a crash can happen.

This is my ‘discontinuity’. We do not know what will trigger this. We do not know where it will start. We do not know its scale, although I think it will be big. We cannot predict the durability of institutions in the face of it. We cannot predict their liquidity at a point of time during it. We are unable to say how long the consequences will last. And quite critically we do not know how governments will react. If those things are not a measure of uncertainty I am not sure what is and of course each has spillovers for the gilt market.

What are those spillovers? First, there could be market breakdown: liquidity failure might ensure that. We cannot know that market players will not fail, especially when their current solvency is based solely on inflated asset values that will disappear overnight.

Second, there could be forced selling of gilts: the supposedly reliable asset may be sold in the face of liquidity failures to realise cash wherever it is available.

Third, there could alternatively be a flight to safety and a massive demand for gilts, assuming that liquidity survives. So prices might irrationally rise: the excess value now is in no small part a measure of risk aversion and not just yield. This excess may increase.

But let’s also be clear that, fourthly, the government may respond to this by flooding the market with gilts to maintain positive interest rates by reversing QE. It would be an act of folly, but governments are capable of those.

Fifth, things might go the other way. The government might have to (I think it will) inject cash into the economy. But it could not do QE again because there may not be enough gilts to do it with. So the gilt market may be abandoned and direct cash issuance could happen. It happened in WW1. It could happen again. And that changes the whole long term nature of the market.

Sixth there are unpredictable inflation consequences impacting yield expectations.

Seventh, interest rates could move in a number of ways.

But, eighth, just to add some fun serious tax changes could have serious impacts on asset values. Throw in a wealth tax and see what happens.

My point is, we just don’t know. But the commentators ignore all this. They say we are dealing with risk when glaringly obviously in a discontinuity that need not, and almost certainly will not be the case. There model refuses to recognise that this could seriously disrupt the gilt market. Mine accepts it could. They’re different models. And I say I am right because my model is evidence based: I am discussing the world that is. Their model is based on a world that clearly does not exist. That’s why they’re wrong.

And then, I come to my second theme, which is that contrary to the suggestion from my commentators, markets will not react immediately or rationally to any of these scenarios and the others that are possible (I am not suggesting the above list is complete). The idea that markets clear immediately is what is called ‘freshwater’ thinking because it is associated with Chicago. The assumption is that rational people rationally change their minds immediately when facts change because a) they know precisely what is happening and b) can process it immediately. This, of course is absurd. That cannot happen. Instead, there is a lag in processing, if it ever happens at all (the fact that I am writing this blog shows that for some this clearly has not occurred since 2008). This is ‘saltwater’ thinking because it is the basis for the neo-Keynesian of east coast USA universities.

Saltwater thinking is, of course, correct. But we also do not know how long correction takes, or if at all (and by raising that point I make my own position clear) But what we do know is that whilst it occurs models break down, sometimes completely. So the discontinuity has an impact, even on gilt markets, whilst reappraisal to take account of the new reality occurs.

And the only thing we know about that new reality is that gilts will be redeemed at par, which means that the only rational valuation in the face of discontinuity is something not too far from that value. But right now we are far from it. And I’d suggest that makes the current premium looks decidedly uncomfortable.

You can disagree, of course. But please don’t say there is no logic to my disagreement, because there most certainly is, and unless anyone criticising it is willing to claim their clairvoyance their counter-argument based on a spreadsheet is actually utterly irrational, because making such a claim just shows  what they do not admit that you do not know and what assumptions you will not embrace.

At least I admit the scale of my uncertainty. It really is time my commentators did theirs.

PS This has been written in haste in little more than 90 minutes – which is pretty good going for 2,200 words. It could be improved  As a result and I may return to it to do so at some time. 

Stiglitz and the full force of Sonnenschein-Mantel-Debreu

Published by Anonymous (not verified) on Sat, 16/09/2017 - 11:43pm in

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Economics

In his recent article on Where Modern Macroeconomics Went Wrong, Joseph Stiglitz acknowledges that his approach “and that of DSGE models begins with the same starting point: the competitive equilibrium model of Arrow and Debreu.” This is probably also the reason why Stiglitz’ critique doesn’t go far enough. It’s strange that mainstream macroeconomists still stick […]

As Children Starve, Rees-Mogg Finds Growth in Food Banks ‘Uplifting’

Published by Anonymous (not verified) on Sat, 16/09/2017 - 7:34pm in

I’ve had to write this response to Rees-Mogg’s fatuous, complacent and quite frankly, evil comments about the massive increase in food banks, because it made me so furious. On Thursday, Mike over at Vox Political reported that the Camborne Pool and Redruth food bank reported that some children in Cornwall are literally starving. This food bank hands out 10,000 meals a month, but states that they know there are many more children that they aren’t reaching.

At the same time, Rees-Mogg, whom Mike describes as the darling of the Tory party, was on LBC radio saying that he found this ‘uplifting’. Mike responded by describing Rees-Mogg as an ignorant, homicidal fool.

http://voxpoliticalonline.com/2017/09/14/food-bank-says-children-are-starving-rees-mogg-finds-that-uplifting/

Yesterday, Mike also put up the news that a food bank in Bath has challenged Mogg to volunteer to work for them, so he can see for himself the hardship that the people coming to these banks are experiencing, and hear their stories. Mike commented that there was fat chance of that, as Mogg hasn’t done a day’s work in his life. But he would be improved by having to work in one, or, better still, having to go to one himself.

http://voxpoliticalonline.com/2017/09/15/after-rees-mogg-said-food-banks-that-couldnt-help-the-starving-were-uplifting-hes-challenged-to-work-in-one/

The I yesterday printed Mogg’s comments in full. Basically, the aristo Tory MP for north-east Somerset said that the amount of generosity shown by people in the expansion of food banks was ‘uplifting’, and then went to claim that state aid could not solve the problem of poverty or provide for all the poor.

There’s nothing new in what he said. Bill Clinton made pretty much the same speech when he was president of the US. Clinton stated that there wasn’t a government programme that could solve every eventuality, and so praised private charity and initiatives in doing so. His speech, and admiration for private charity, was part of his ideological commitment to reducing still further whatever was left of the vestigial American welfare state that Reagan and the Republicans hadn’t already destroyed.

Thatcher, and it seems Young Master Mogg, believed that reducing state aid would result in more people giving to charity. And it’s true that studies in the US have shown that Conservative religious people give more to charity than secular liberals. But this misses an important point:

Private charity on its own is insufficient to tackle poverty. State aid is far better at doing so.

I also found a piece in Lobster’s ‘View from the Bridge’ a little while ago, that quoted a biography of Thatcher. Before she died, Thatcher herself supposedly realized that destroying the welfare state hadn’t made people more generous.

Which completely contradicts what Mogg has said above.

As for Mogg’s own attitude, this is the arrogant complacency of a wealthy aristocrat, who has little understanding of the lives of working people, and who fears them and the state will undermine the position of himself and his similarly entitled monied chums at the apex of British society. Young Master Mogg has voted consistently against increasing welfare benefits for them, and voted for increasing the tax burden on working people. But he’s been dead opposed to increasing the tax burden on people earning over £150,000 a year.

It’s the attitude the complacent British upper and middle classes, that looked with bland equanimity on the grinding poverty and squalor of industrial Britain and saw nothing wrong with it. It’s the same attitude that produced this appalling piece of poetry on the benefits of work to children.

‘Tis proper, Sophy, to be sure,
To pity and relieve the poor.
But do not waste your pity here,
Work is not hard to her, my dear,
It makes her healthy, strong and gay,
And is as pleasant as your play.

from Peter Vansittart, Voices 1870-1914, p. 76.

And it’s also contemporary in that we’ve had for the past decade or so Tories and Blairites telling us how wonderful work is for the mental wellbeing of the disabled, even when the empirical evidence says the exact opposite.

Mogg’s a complacent, ignorant pratt, who looks on the growth of child poverty due to the free trade policies of his poverty with complete indifference. Get him out. He has no place in politics, and his views will lead to more starvation and suffering.

Pat Mills Talks to Sasha Simic of the SWP about the Politics of 2000AD

This comes from the Socialist Workers’ Party, an organization of which I am not a member and which I don’t support. But this is another really great video, in which one of the great creators of the British comics for over forty years talks about politics, social class, the role of capitalism and women and feminism, not just in 2000AD, but also in comics and publishing generally, and the media.

Mills was speaking as part of annual four day convention the Socialist Workers hold on Marxism. Simic introduces himself as the person, who gets the annual geek slot. As well as a member of the party, he’s also a convener of USDAW. And he’s very happy in this, the centenary of the Russian Revolution, to have on Pat Mills.

Mills starts by saying that as he was growing up in the 50s and 60s, he read the same books everyone else did – John Buchan, Ian Fleming, Dennis Wheatley, Sherlock Holmes and the Scarlet Pimpernel. But there was something about it that made him angry, and it was only looking back on it that he came to realise that what infuriated him was the fact that these were all authors from the upper and middle classes, who created heroes from those class backgrounds. He makes the point that these were good writers, but that some of their work was very sinister the more you go into it. Like John Buchan. Buchan was the major propagandist of the First World War. Mills says that Alistair Campbell, Tony Blair’s infamous spin doctor, had nothing on him. He promoted the First world War, for which he was rewarded with the governorship of Canada.
He states that he doesn’t want to go too far into it as he’ll start ranting. Nevertheless, he’s glad to be able to talk to the people at the SWP’s convention, as it means they have a similar opinion to him, and he doesn’t have to censor himself.

He makes the point that there are very, very few working class heroes, and believes this is quite deliberate. It’s to deprive working people of a strong role. When the working people do appear, it’s as loyal batmen, or sidekicks, and there is an element of parody there. And it’s not just in comics and literature. In the 1980s he was contacted by the producers of Dr. Who to do a story. He wanted to have a working class spaceship captain. He was told by the script editor that they couldn’t. They also didn’t like his idea to have a working class family. It was only by looking back on where this hatred of the heroes of traditional literature came from, that he came to realise that it wasn’t just that he didn’t want to have any generals in his work.

He also talks about how it’s easier to get away with subversion in comics, as comics are treated as a trivial form of literature, which nobody really cares about. The profit motive also helps. So long as it’s making money, comics companies don’t care what’s going on. And this explains how he was able to get away with some of the things he did in Battle. He states that the way he works is by pretending to write something mainstream and inoffensive, and then subvert it from within. An example of that is Charley’s War in Battle. This looks like an ordinary war strip, but in fact was very anti-war. Even so, there were times when he had to be careful and know when to give up. One of these was about a story he wanted to run about the entry of the Americans into the War. In this story, a group of White American squaddies are members of the Klan, and try to lynch a Black soldier. Charley wades in to help the Black guy. The management rejected the story on the grounds that they didn’t want anything too controversial. Mills decided to draw in his horns and bite his tongue at that point, because he had a bigger story lined up about the British invasion of Russian in 1919, when we sent in 20-30,000 men. It was, he says, our Vietnam, and has been whitewashed out of the history books.

He also makes the point that subversion was also present in the girls’ comics. Even more so, as there was a psychological angle that wasn’t present in the boys’. For example, there was one story called ‘Ella in Easy Street’, where a young girl reacts against her aspirational family. They want to get on, and so the father has two jobs, and the mother is similarly working very hard to support their aspirations. But Ella herself is unhappy, as it’s destroying what they are as a family. And so she sets out to sabotage their yuppie dream. Mills says that it’s not all one-dimensional – he looks at the situation from both sides, pro and con, but the story makes the point that there are things that are more important that materialism and social advancement, like family, comradeship. He says that such a story could not be published now. It’s rather like The Loneliness of the Long Distance Runner, where the hero, in the end, throws the race as a way of giving the system the finger.

Mills reminds his audience just how massive girls’ comics were in the ’70s. They were bigger, much bigger, than the boys’. 2000AD sold 200,000 copies a week in its prime. But Tammy, one of the girls’ comics, sold 260,000. This is really surprising, as women read much more than we men. These comics have all disappeared. This, he says, is because the boys’ took over the sandpit. He has been trying to revive them, and so a couple of stories from Misty have been republished in an album.

This gets him onto the issue of reaching the audience, who really need it. In the case of the stories from Misty, this has meant that there are two serials on sale, both of which are very good, but in a book costing £17 – odd. The only people going to read that are the mothers of the present generation of girls, perhaps. To reach the girls, it needs to be set at a lower price they can afford. This is also a problem with the political material. If you write something subversive, it will receive glowing reviews but be bought by people, who already agree with you. He wants his message to get further out, and not to become a coffee table book for north London.

He talks about the way British comics have grown up with their readership, and the advantages and disadvantages this has brought. British comics has, with the exception of 2000AD, more or less disappeared, and the readership of that comic is in its 30s and 40s. People have put this down to demographics and the rise of computer games, saying that this was inevitable. It wasn’t. It was our fault, says Mills. We fumbled it. Games workshop still have young people amongst their audience, while the French also have computer games across the Channel, but their children are reading comics.

Mills goes on to say that it’s easier writing for adults. Writing for 9 and 10 year olds is much harder, because if they don’t like a story, they’ll say. He says to his audience that they may think the same way, but they’re much too polite to say it at conventions. And they had to respond to their young readers as well, as the kids voted on it every week. They’d tell you if they thought it was a bad story, even if you thought it was the best one so far, and asked yourself what was wrong with the little sh*ts.

He also talks about how difficult it is to break into comics. He has friends, who have been trying for decades to get into 2000AD, and have been unsuccessful. His advice to people trying to do so is: don’t bother. There’s nothing wrong with you, it’s 2000AD. And this also effects text publishing. All the publishers have now been bought up, so that HarperCollins have the fingers in everything, such as Hodder and Stoughton. And their politics aren’t ours.

The way round this is to get into web publishing. Here he digresses and talks about pulp fiction, which is a close relative of comics. He was talking to a guy at a convention, who writes pulp fiction and puts it on the net. It only costs a few pence. The man writes about a zombie apocalypse, but – and this is true, as he’s seen the payment slips – he’s pulling in £3,000 a month. Mills says that this is important as well. He wants to get his material out there, but he also wants to eat. This shows you how you can make money publishing it yourself. Later on in the video, after the questions and the comments from the audience, he goes further into this. He mentions some of the web publishers, one of which is subsidiary of Amazon, which will allow people to publish their own work. He also talks about self-publishing and chapbooks. He found out about these while writing Defoe, his story about Leveller zombie killer in an alternative 17th century England. Chapbooks were so called because they were cheap books, the cheap literature of the masses. And this is what comics should go back to. He says that everyone should produce comics, in the same way that everyone can also make music by picking up an instrument and playing a few chords.

He also praises some of the other subversive literature people have self-produced. Like one piece satirizing the British army’s recruitment posters. ‘Join the army’, it says, ‘- like prison, but with more fighting’. Mills is fairly sure he knows who wrote that as well. It was another guy he met at a convention, who was probably responsible for the anti-war film on YouTube Action Man: Battlefield Casualties. He enormously admires this film, and is envious of the people, who made it.

He also talks about some of the fan letters he’s had. One was from the CEO of a school, he talks about the way reading 2000AD opened up his mind and changed his moral compass. The man says that everything he learned about Fascism, he learned from Judge Dredd, everything about racism from Strontium Dog, and feminism from Halo Jones. He and his headmaster, whom he names, were both punks and he’s now opened a school in Doncaster. The most subversive thing you can do now is to try to create an open-minded and questioning generation of young people. The letter is signed, yours, from a company director, but not an evil one, and then the gentleman’s name.

He concludes this part of the talk by describing the career of James Clarke, a member of the Socialist Labour Party, the Communist Party, a lion tamer and conscientious objector. During the War he ran escape lines for British squaddies in France. And people say that pacifists are cowards, Mills jokes. How much braver can you be than sticking your head in a lion’s mouth. He wrote a pamphlet defending a group of comrades, who tried to start the revolution by following the example of the Irish Nationalists and blow things up with a bomb. The pamphlet argued that this was wrong, and that if the working class wanted to gain power, they should concentrate on confronting capitalism through direct action. He also wrote poetry. Mills describes Clark as being a kind of Scots Tom Baker. One of these is a biting satire of Kipling’s If. The poem begins by asking if the reader can wake up every morning at 5 O’clock, or 4.30, and then labour at their machines, and see their wives and children suffer deprivation while those, who haven’t earned it take it all the profits, and describes the backbreaking grind of hard working life for the capitalist class in several stanzas. It ends with the statement that if you can do all that, and still be complacent, then go out, buy a gun and blow your brains out.

Clearly, I don’t recommend any actually do this, but it is a witty and funny response to Kipling’s poem. I found it hugely funny, and I do think it’s a great response to what was voted Britain’s favourite poem by the Beeb’s viewers and readers a few years ago. Can you imagine the sheer Tory rage that would erupt if someone dared to recite it on television!

Many of the comments are from people thanking Mills for opening their eyes and for writing such great stories. They include a man, who describes how Mills’ works are on his shelf next to his copy of Das Kapital. Another man describes how he used to buy 2000AD just after going to church on Sunday. So after listening to some very boring sermons, he came back from Baptist chapel to read all this subversion. One young woman says that the zines – the small press magazines, that appeared in the 1990s – seem to be still around, as she has seen them at punk concerts. Another young woman says that although comics are seen as a boys’ thing, when she goes into Forbidden Planet near her, there are always three girls in there and two boys. She also talks about how many young women read Japanese manga. Mills states in reply that manga stories generally are light and frothy, and so not the kind of stories he wants to write. But as for women in comics, he says that he spoken several times to students on graphic novel courses, and each time about 75 per cent of them have been women, which is good.

He also talks about Crisis and Action. The Third World War strip in Crisis was about the politics of food, and was set in a world where food production was dominated by a vast multinational formed by the merger of two of today’s megacorporations. Mills states that when the strip covered what was going on in South America, that was acceptable. However, at one point he moved the story to Brixton, finding a Black co-writer to help with the story. At that point, the White Guardian-reading liberals started to be uncomfortable with it. There was also a story in which Britain leaves the EU. This results in the rise of a Fascist dictatorship, and the EU responds by invading Britain. Mills says that he’s been trying to get Crisis relaunched, but the company are stringing him along with excuses, probably because it’s easier than arguing with him.

Mills obviously did the right thing by finding a Black co-writer. Marvel suffered a barrage of criticism with some of their attempts to launch a series of Black superheroes, like the Black Panther as part of the Blaxploitation wave of the 1970s. The Black Panther was particularly criticized. The creators were old, White dudes, who didn’t understand urban Black culture, even if the comics themselves were sincere in presenting a sympathetic view of Black Americans and combating racism.

He also talks briefly about Action, and the controversy that caused. What really upset Mary Whitehouse and the rest was ‘Kid’s Rule UK’, a strip in which a disease killed everyone over 16, and Britain was inhabited solely by warring street gangs. Mills used to take the same train from where he was living at the time with Mary Whitehouse. He said he was editing a Hookjaw script at the time, and notice Whitehouse over the other side of the carriage looking daggers at him. So he put in more carnage and more arms and legs being bitten off.

One of the most interesting questions is about the politics and morality of Judge Dredd. Dredd is a fascist, and in one of the strips it seemed to take the side of authority over subversion with no irony. This was in a story about the punks taking over Megacity 1. At the end of the strip, Dredd gets hold of the leader, and makes him say, ‘I’m a dirty punk.’ Mills actually agrees with the speaker, and says that there are people, who take Dredd as a role-model. He’s had letters from them, which he doesn’t like. He doesn’t know what these people do. Perhaps they have their own chapterhouse somewhere. He went cold inside when he heard about the story. It wasn’t one of his. It was by John Wagner, who isn’t at all political, but is very cynical, so this has some of the same effects of politics. But 75 per cent of Dredd comes from Mills. Mills states that it’s a flawed character, and that can be seen in why the two Dredd films never did well at the box office. Dredd was based on a particular teacher at his old school, as was Torquemada, the Grand Master of Termight, a genocidally racist Fascist military feudal order ruling Earth thousands of years in the future. They were both two sides of the same coin. That was why he enjoyed humiliating Torquemada. But it isn’t done with Dredd. Yet it could have been different, and there could be instances where people have their revenge on Dredd without losing the power of the character. He states that it was because Chopper did this in the story ‘Unamerican Graffiti’, that this became the favourite Dredd story of all time.

It’s a fascinating insight into the politics of the comics industry. The zines and other self-published small magazines he describes were a product of the Punk scene, where people did start putting together their own fanzines in their bedrooms. It was part of the mass creativity that punk at its height unleashed. As for the web comics, he talks about a couple that he finds particularly impressive, including those by the author of the dystopian science fiction story Y – the Last Man, set in a future in which all the men in the world have been killed by another disease. A number of my friends used to publish their own small press magazines in the 1990s, as did Mike. Mike started his own, small press comic, Violent, as an homage to Action when it was that comics anniversary. Mike was helped by some of the artists and writers from 2000AD, and so some of the tales are very professional. But probably not for delicate, gentle souls.

Amongst SF fandom, chapbooks are small books which another publishes himself. And they have been the route some professionally published authors have taken into print. Stephen Baxter is one of them. I think his Xelee stories first appeared in a chapbook he sold at one of the SF conventions.

Looking back at Kids Rule UK, this was my least favourite strip in Action. I was bullied at school, and so the idea of a Britain, where everything had broken down and there was nothing but bullying and juvenile violence really scared me. Action took many of its strips from the popular culture of the time. Hookjaw was basically Jaws. One-Eyed Jack seemed based very much on the type of hard-boiled American cop shows, if not actually Dirty Harry. One of the SF movies of the late sixties was about an America in which teenagers had seized power, and put all the adults in concentration camps were they were force-fed LSD. One of the four Star Trek stories that were banned on British television until the 1980s was ‘Miri’. In this tale, Kirk, Spock and the others beam down to a planet occupied entirely by children, as all the ‘grups’ – the adults – have been killed by disease. Kids Rule UK seems very much in the same vein as these stories.

Mills’ story about Dr. Who not wanting to show a working class family, let alone a spaceship captain, shows how far the series has come when it was relaunched by Russell T. Davis. Christopher Eccleston basically played the Doctor as northern and working class, wile Rose Tyler’s family and friends were ordinary people in a London tower block. As for not wanting to show a working class spaceship captain, that probably comes from very ingrained class attitudes in the aviation industry. A friend of mine trained as a pilot. When he was studying, their tutor told the class that the British exam included a question no other country in the world required, and which was particularly difficult. He stated that it was put there to weed out people from working or lower middle class backgrounds, as they would fail and not be able to retake the exam, as their competitors from the upper classes could.

It’s great to hear Mills encourage people try to produce their own work, and not be disheartened if they are rejected by mainstream publishers. I’m also saddened by the absence of any comics for children. They offered me when I was a lad an escape into a whole world of fun and imagination. And at their best, they do encourage children to take an interest in real issues like racism, sexism, bigotry and exploitation. I hope some way can be found to reverse their disappearance.

Paul Krugman: Politicians, Promises, and Getting Real

Published by Anonymous (not verified) on Sat, 16/09/2017 - 3:35am in

Paul Krugman:

Politicians, Promises, and Getting Real, by Paul Krugman, NY Times: On Wednesday Donald Trump demanded that Congress move quickly to enact his tax reform plan. But so far he has not, in fact, offered any such plan...

Meanwhile, 17 Senate Democrats ... have signed on to Bernie Sanders’s call for expanding Medicare to cover the whole population. So far, however, Sanders hasn’t produced either an estimate of how much that would cost or a specific proposal about how to pay for it.

I don’t mean to suggest that these cases are comparable: The distinctive Trumpian mix of ignorance and fraudulence has no counterpart among Democrats. Still, both stories raise the question of how much ... policy clarity matters for politicians’ ability to win elections and ... govern.

About elections: The fact that Trump is in the White House suggests that politicians can get away with telling voters just about anything that sounds good. ...

On the other hand, the ignominious failure of Trumpcare shows that reality sometimes does matter. ... Once the public realized that tens of millions would lose coverage..., there was a huge backlash...

The story of tax reform ... is starting to look a bit similar. ...

In fact, Trump himself seems to be experiencing cognitive dissonance. “The rich will not be gaining at all with this plan,” he declared Wednesday. ... Is he oblivious, lying, or both? ...

The contrast between what he’s claiming and anything Republicans in Congress will be willing to support is so great as to practically invite ridicule and another popular backlash. ...

But is the push for single-payer health care taking Democrats down a similar path?

Unlike just about everything Trump and company are proposing, Medicare for all is a substantively good idea. Yet actually making it happen would probably mean ... a serious political backlash. For one..., it would require a substantial increase in taxes. For another, it would mean telling scores of millions of Americans who get health coverage though their employers, and are generally satisfied..., that they need to give it up and accept something different. ...

Democrats could eventually find themselves facing a Trumpcare-type debacle, unable either to implement their unrealistic vision or to let it go.

The point is that while unrealistic promises may not hurt you in elections, they can become a big problem when you try to govern. Having a vision for the future is good, but being real about the difficulties is also good. Democrats, take heed.

Fed May Have Too Much Faith in Inflation Forecasts

Published by Anonymous (not verified) on Sat, 16/09/2017 - 3:35am in

Tim Duy:

Fed May Have Too Much Faith in Inflation Forecasts, by Tim Duy: Despite a low unemployment rate, inflation slowed this year, confounding central bankers who set in motion a tightening cycle on the expectation of firming prices. This leaves the Federal Reserve stuck in a quandary. Either transitory factors restrain inflation only temporarily, or perhaps expectations sink below the Fed’s 2 percent target. If the former, the central bank can continue along the current path of gradual rate hikes. The majority of monetary policy makers lean in this direction. But if the latter, sticking to the current plan risks excessive slowing and even recession. It is the type of policy mistake we should fear in the mature stages of a business cycle... ...[Continued at Bloomberg Prophets]...

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