Nothing like a good dose of austerity for the working class and other misérables. Such treats do come back and bite even the well heeled. And to remember, had it not been for some less ‘captured’ Parliamentarians the UK would have been off to war with its ally, the US, against Syria, and spending taxpayers’ pounds with the enthusiasm of a drunken sailor — and with no concern about ‘austerity’…
So there he is, the UK Prime Minister (of selfie-photo fame with the US President and Danish PM) in galoshes (‘wellies’) sloshing through flood waters doing the photo-op thing for the cameras. Thing is that gambit is not working for this non-working class lad, and Eton boy.
Simon Wren-Lewis has a go at the bumblers looking for some flood waters, of which there are many, to do the ‘I feel your pain’ photo nonsense.
Austerity and Flood Damage. ‘Nice’ photo of the damage.
Are the UK floods Cameron’s Katrina? Another ‘nice’ overhead suggests a modern version of the flood prone Bangladesh.
Even if the weather event is statistically a rare one, putting a few pennies into the kitty to deal with natural disasters as the flooding would have mitigated some of the damage. And when at least one of this upper crust team is a climate-change sceptic, we know the peasants are on their own. The irony would be that flood waters and inclement weather pay no heed to the exceptionalism of the non-peasants.
And talking about the upper crust, we have an interview of Boris Johnson, where the Mayor shows a total non-familiarity with the basics of life, the price of bread or of milk — clearly a task for those downstairs.
We should not forget that these folk were voted into office, and not by aliens.
…evidence that real economists have a macabre sense of humour?…
Bombarded with the drivel of ‘expansionary austerity’, we realise there has to be something truly divine in that belief system. So driven by curiosity we take a look at economics from the perspective of those high priests of the school of mystical economics, No, Human Sacrifices Do Not Lead To Economic Growth. [Truly, an article that causes one of those ‘why did I not think of such a title’ moments, as its content emphasises the title.] Read the rest of this entry »
…if we consider that there are economists with a cause and economists with analysis, and even economists with insufficient analysis, we learn to discard (or not buy) the chaff…
Two articles from different directions merit a glance.
In the area of macroeconomics we find an article that sheds light on the design and implementation of macroeconomic policy. Simple and straightforward – having only a hammer or having expertise in using only that hammer does not make everything a nail, when the task at hand is to repair a leaking faucet or to treat a wound.
It is all the more serious when the policy is directed to benefit mainly the more influential class of society to the detriment of the less fortunate – where the culprit, in this case the financial sector, is promptly bailed out and enabled, and the victims, the unemployed and increasingly disadvantaged, pay to support the earlier and continuing transgressions of that sector. An example, the latest unemployment rate, for the Eurozone, 12.1%; Spain, 26%; Greece, 27.5% – rates that have generated no sense of urgency to remedy the problem in the affected countries, as focus remains on austerity.
Mike Konczal comes to the rescue over at next new deal, despite the esoteric-sounding title of the post, Two Simple Reasons to Not Fight Bubbles With Higher Interest Rates.
In the area of microeconomics, Tim Taylor over at conversable economist uses the US Thanksgiving Day celebration to explain supply and demand for the holiday victuals. The analysis highlights the importance of data and how the data are transformed into charts and tables that complement or reinforce the analysis. Aside a minor typo, he offers something to chew on with his, An Economist Chews Over Thankgiving.
So, then, once the likelihood of ideology or ignorance in economic discourse is considered, economics comes across not as indiscipline or alchemy but rather as the discipline that it is. Charlatans do abound.
Just when you thought, ’At long last, dead and buried’, the impossible happens. Debt walks abroad in the land , in Germany , a resurrection that would have gone unnoticed but for an enterprising and civic-minded ‘Yves Smith’ who understands the language and the economics. We learn that the otherwise well-respected and accomplished Prof Rogoff decides to exhume and breathe life into the buried R-R GITD, and he does so in a fit of academic pique.
Over at naked capitalism is Ms Webber’s well-researched and comprehensive head scratcher, Ken Rogoff Loses It, Calls Criticism of Errors in Debt Paper a “Witch Hunt” From this we realise to our chagrin that the redoubtable Prof Rogoff has clearly outclassed our incomparable Miracle Max.
To the world’s bemusement, ‘un jeu d’enfants malhonnêtes‘, the game of ‘debt ceiling’, artificial contrivance, is played, yet again on the people of the US and the world; and it should resume early in 2014, with the same hysteria. A cynical but useful distraction is deployed to show US ‘democracy’ at work as legislators and administration officials pursue their private agenda, unexamined, or cursorily if so, by the very understanding corporate media.
Once more, and ever critical will be the pressing need to address and reduce the ‘crushing debt’ and the ‘intolerable’ debt/GDP ratio – with the implicit agreement of the duopoly to drastically cut social programmes to resolve the ‘crisis’ that will undermine US ‘credibility’. [Will the very dead and deeply buried ‘fiscal cliff’ be resurrected?]
And analysts who fail to sell the desiderata of the political and special interests class are rarely afforded the MSM forum to state the obvious. Despite that, and with the myriad ways in which it has been said before, we have once again the statement from alternative media: There is no debt crisis
And to consider the ulterior motives behind the frenzy to attack, destroy and dismember Syria have been exposed, one conclusion seems apparent: This time is, should be, different – the revenge of the formerly duped and still very economically disadvantaged.
Only in the USA.
The Farce continues – debt, deficit, fiscal cliff, Grand Bargain, sequester… As the famous Yogi Berra would say, ‘It’s déjà vu, all over again’…
And not just the curmudgeon will be unimpressed with acting as poor as the play is weak, and just as predictable in its obvious guile. Without any further ado, and we just happen to have, as Woody Allen would say in Annie Hall, right here the exposure of the charade being perpetrated against a majority of USans sedated into malleable ignorance. What do we have?
The debt thing is a joke, a poorly disguised distraction. Other than the usual mass of disadvantaged, one high profile casualty would be team Reinhart-Rogoff who had, or allowed to be, misused their non-peer reviewed or double checked, GITD, damaging their reputations in the process.
We then have The Grand Bargain, (the Great Betrayal according to William K. Black) by a US President who had conceded even more than had been requested. Fortunately for the voiceless, the surfeit of concessions had been rejected by an unhinged fringe group of hysterical opponents with a scorched earth policy, and one bent on a return to some mythical US of the past. In essence, though, the rhetoric between the indistinguishable exalted leaders of the corporate duopoly darkly comic and cynical, as greater self-enrichment is one result of their corporate sponsors profiting from their legislative endeavours.
A curmudgeon’s brief guide to the charade. And the only prerequisite needed is just a modicum of critical thinking. For starters, the destructive impact of the ‘Great Recession’ insufficiently slowed, yet there is the sound of the ‘dog whistle’ to ‘pivot’ (always a sport or military metaphor) to debt reduction, and a President ever eager to lead the attack – if the ‘polls’ or ‘media’ indicate possible political advantage.
In 2009 the fair blog identifies The Deficit Distraction
Although Obama says he “make[s] no apologies for having acted short-term to deal with our recession,” he appears to have bowed somewhat to budget-balancing pressure, claiming sleeplessness over the deficit (Washington Post, 6/23/09), and declaring his intention to create a deficit-neutral healthcare bill (New York Times, 6/26/09).
The date of the article? September 2009. Quickly to 2011. We have the question, Has the Media Totally Forgotten About the Unemployed? And here the latter day peers of Incitatus would make him look wiser than Solomon.
On Capitol Hill, any trace of job-oriented stimulus has melted with the winter snow. Instead, the city’s hot for deficit reduction, and the press has caught the fever.
Galileo Galilei would be confused.
After all, he did have to use his telescope, something very, very few had then, and also had to apply some serious maths in his astronomy, knowledge and skills way beyond most of his day. And there was the challenge of those orbiting distant and close planets including earth, which were a bit too large to show folk in Tuscany or Rome to prove his theory and discovery. And in any case, the general public had no option but to believe the religious and Aristotelian truth that the planets orbited the earth – the heresy business could be brutal for body and mind.
So this present challenge should be a no-brainer, no challenge, right? All the data and evidence are out there, readily available for even an economics senior to analyse and reach the obvious conclusion? Wrong. Just like Galileo, analysts in an enlightened western world face similar rejection and ridicule – the new religion of Crony Capitalism has declared the reality to be a fiction. No matter how detailed and clear the analysis, though not in Latin, the verdict of the corporate media, ‘Heresy!’
Repudiation of the Reinhart-Rogoff advocacy of that famous ‘fiscal cliff’, inconclusive in their GITD, did not mean the religious truth of Expansionary Austerity would not remain received doctrine for the faithful. Thus, Krugman would state, in referring to a chart on government purchases in his The Depressed Economy Is All About Austerity,
As you can see, the gap is large and has been growing rapidly; it’s currently at about 400 billion 2009 dollars, or more than 2 1/2 percent of GDP. Given reasonable multipliers, this suggests that real GDP is somewhere between 3 and 3.75 percent lower than it would have been without the austerity. And given the usual Okun’s Law rule of half a point of unemployment per point of GDP, this in turn says that without the austerity we’d have an unemployment rate well under 6 percent, maybe even under 5.5 percent.
And that unemployment rate is not the more realistic U6. Read the rest of this entry »