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Weekend reflections

John Quiggin38 Comments

Weekend Reflections is on again. Please comment on any topic of interest (civilised discussion and no coarse language, please). Feel free to put in contributions more lengthy than for the Monday Message Board or standard comments.

38 thoughts on “Weekend reflections”

  1. With the government resorting to picking winners (to fight CO2 emissions) I was surprised that they passed over the application for funding submitted by Enviromission. It’s proposal seems much more sound than the photovolatic project (which can’t deliver electricity at night) that did get funding. Obviously the market was surprised also and following sudden movements in stock Enviromission called a temporary 2 day halt to trading while it tried to draft an explaination regarding the impact.

    In any case the money would have been more wisely spent if they had instead given grants to consumers that buy green energy.

  2. I would like to know a little more about being carbon neutral.
    It sounds like a cross between political correctness and the Y2K bug

  3. John, I understand that you are not a big fan of the Austrian school of economics, which you dismiss as a few people in second tier universities and a person with a field project in Africa. How about giving some credit to Mises and Hayek for pointing out some decades before the fall of the Wall that central planning could never work? That looks like a pretty impressive achievement in retrospect, especially when you consider the tens of millions of lives that were wrecked in the failure of the central planning project.

    It may help to remember that there was a time when Marxism could have been dismissed in much the same way, and look how that turned out in a few decades!

    Just in case the Austrian point of view turns out to be robust, it will be helpful to provide some onging commentary on the work that they are doing for the benefit of people who are open-minded on the issue without having the time or the interest to go looking for themselves. This piece from 1985 gives some indication of the main lines of the Austrian project, especially at it applies to economic rationalism and deregulation in Australia.

    http://www.the-rathouse.com/hayaustriankey.html

    On that topic I am interested to know whether you still think that deregulation was a mistake, or whether you just meant to say that it should have been done better.

    And this is a story from Peter Boettke, writing about the kind of political economy they are doing at the London School of Economics these days. Peter is one of the young movers and shakers at George Mason University and he has just spent some time at the LSE where he gave some talks and wrote some papers that are linked from this post.

    http://austrianeconomists.typepad.com/weblog/2006/10/is_there_a_uniq.html

    “The LSE approach, Puglisi tell his reader, is characterized by four distinctive traits in resarch: (1) combine theory and evidence; (2) focus on small, self-contained, and meaningful objects within a given set of political institutions rather than all-encompassing political institutions; (3) sound empirical methods as exemplified by panel data analysis as opposed to cross country analyses that intrinsically suffer from omitted variables and problems of heterogeneity, and (4) a search for black holes in the existing literature that might be filled in a manner similar to the Becker inspired Chicago approach.”

    “Puglisi argues that the LSE approach to political economy results in politically feasible political economy. This LSE approach to political economy is most closely identified with Tim Besley. But does it really represent a separate school of thought in political economy as Puglisi suggests?”

  4. I fell to sleep on Thursday night listening to Phillip Adams interview Chris Masters about his much hyped book… “Jonestownâ€?. I doubt it would have registered on my radar if the ABC board had allowed it to be publish. I had a slight recollection of a 4 Corners episode with the same name. Now I will probably go out and buy the book.

    Despite all the hissing and booing that you hear coming from some quarters, Masters sounded quite reasonable. But I expected nothing less. One of the statements that he made was that while Jones seems to push a far right world-view, he is more in the mold of the “agrarian socialist”. I guess I understand what he means. The “turn the rivers inland solutionâ€? was trotted out many-a-time by AJ.

    Adams used phrases like: “recklessnessâ€? and “simulated rageâ€? to describe the Jones persona. But what really puzzles me is the tendency of well educated gay men to favour the right-wing world view… something that neither Adams or Masters discussed (I am not trying to make a generalisation, just an observation).

    Given the antagonism between the Christian Right and gays, how do people like Carl Rove (it is only rumored, he has not actually come out yet) reconcile their way of life with their political power base. It must be a very uneasy tension indeed. Another schism of thought maybe.

    Or maybe it is just a means to an ends. Frued would probably say that it was an outcome of sexual repression. And if female politicians have to be twice as ruthless as male politicians to succeed… well what about gays?

    Whatever the case, ruthlessness is not pretty, and is not a quality I would vote for (or listen to). It all sounds like a bad British comedy based in war-time France, with gay German officers as the main comic relief. It would be sad, if it wasn’t slightly humorous.

  6. The problem with Austrian economics and hard core libertarians: there would be no internet, compulsory superannuation, universal healthcare, congestion charges, gun control, climate change policies, workers rights, and compulsory seatbelts for safety. Similar to socialism it lies in the la la land of dreams with very little practical real world applications.

    Before debunking central planning (and it should be treated with suspicion) think of the many infrastructure programs and works that have been successful due to central planning even by the ‘so called’ elites. Just think of central park in New York, Big Bang fianancial services in London, Snowy Hydro scheme. This is evidence of central planning that works.

    It is a shame in these days that you either have to be pure libertarian or social technocrat. We can be more realistic.

  7. “The problem with Austrian economics and hard core libertarians: there would be no internet, compulsory superannuation, universal healthcare, congestion charges, gun control, climate change policies, workers rights, and compulsory seatbelts for safety”

    Are you trying to produce a list of good things, bad things, just things, or a mix?

  10. Sheik Hilaly’s logic:

    cat + uncovered meat = eat

    The cat engages in its entirely natural behaviour of eating a blameless piece of meat.

    man + uncovered woman = attack

    The man engages in his entirely natural behaviour of attacking a blameless woman.

    Since all cats will eat meat that is presented to them (it is the natural behaviour of a cat), this means that all men will attack an uncovered woman.

    So who exactly is Sheik Hilaly insulting with his idiotic analogy?

  13. chrisl -carbon offsetting at least is a start but some schemes haven’t been up to scratch, others mightn’t get the full worth as climate change may effect the future of the plantations, while some say that this isn’t helping just shifting the burden and that it is only delaying the lifestyle changes that are needed.

  15. The sheik is certainly a villain w.r.t womens’ freedom, most mens’ honour, and cats but it will be his comments about the Bush White House that will set the security services here and abroad going. Little wonder that his charges want him to take the hage pilgrimage until at least next January. You never know who he might meet in that million plus throng at Mecca. Or who might be following him.

  16. “So who exactly is Sheik Hilaly insulting with his idiotic analogy?”

    Who said he was being idiotic? With Muslim men about with views like Hilali, of course women should be wearing, all over, kevlar burkhas. Hilali’s just being practical.

  18. The EnviroMission towers are struggling to get off the ground as the technology is not seen as being proven despite past experiments showing that the method does work. However, try to ask for money to build a tower a Kilometre into the sky in middle of the desert and see if you don’t get strange looks. No wonder they scaled the first one back a bit.

  19. I’m sorry, I hadn’t read the imam’s speech when I posted the above. I hadn’t realised that the meat was to blame for being eaten by the cat!

    Otherwise I’d have thought it was a case of “lock up your cats!” (or perhaps, observa, put them in a kevlar chastity belt?)

  21. simonjm
    If you took a flight in an plane and got somebody else to plant a tree,
    would your conscience be clear?
    It would seem to me that the CO2 you produced would be somewhere in the stratosphere and the tree way down on terra firma
    Better to stay on Terra Firma yourself

  22. “or perhaps, observa, put them in a kevlar chastity belt?”
    Well I wouldn’t know what they have under those burkhas, but then I don’t go round looking up Scotsmans’ kilts either.

  23. “Can the Free Market Slow Deforestation?”
    Yes and not only that it could reverse the trend of deforestation if only the constitution of the free marketplace were changed to facilitate that. The problem is the quantity control freaks are itching to pull more government levers that will ultimately fail for lack of political imprimatur, apart from the lack of shorter time frame incentive.

  24. The market can stop deforestation, but only when governments put a price on carbon dioxide pollution.

    As long as it still free to pump CO2, the Mother of All Externalities, into the atmosphere, then nothing will change. John Howard is the only thing now standing between us and a long road to averting a highly probable catastrophe.

  25. Private ownership can control deforestation because when people own things they have a vested interest in their continued productivity and value. There is a heap of literature on free market environmentalism that shows over and over that private ownership generally creates an incentive for conservation rather than exploitation. Of course that does not always work due to ignorance or short-sight, but you will find that most of the major environmental disasters have happened under public ownership and socialsm. Check out the state of the environment in the USR!

  26. While revisting some basic engineering and metereological science (Given the latest data about thermoclines and the Gulf Stream)I had reason to revist the laws of thermodynamics, for the unintiated and courtesy of Wikipedia:

    * A common scientific joke, as stated by C.P. Snow, expresses the four laws simply and surprisingly accurately as:

    Zeroth: “You must play the game.”
    First: “You can’t win.”
    Second: “You can’t break even.”
    Third: “You can’t quit the game.”

    That in summary is my view of the problem with our changes to the worlds ecoysystems, release of energy over time and our profligate over use of the worlds finite resources. If you don’t understand this then your a contrarian.

  28. Chrisl might like to try Lohmann’s rather lengthy attack on carbon offset programs (“Carbon Trading: A Critical Conversation on Climate Change, Privatisation and Power”) downloadable from this site

  29. By the way, the report of the Stern Review is supposed to be coming out on Monday. In a teaser dated 29/10/06, The Independent said: “In a preview of a report he is to deliver next Monday, Sir Nicholas [Stern] told the Cabinet the world would have to pay 1 per cent of its annual GDP to avert catastrophe. But doing nothing could cost 5 to 20 times that amount. He told them: “Business- as-usual will derail growth.”

  30. If your statement about educated gay men being left wing then what do you make of Bob Brown. I suspect that your theory is inaccurate.

    I suspect you mean right-wing. But I agree that Bob Brown is a good example. He does not come over as an angry person (as far as I can see). He seems to argue his point of view in an open and dignified manner. As far as I can recall, he has never hidden behind legal threats to protect his persona, unlike Alan Jones.

    I did use the word tendency. And I am yet to come across a gay man who is not fairly well educated. So I think it would be difficult to tar them all with the same brush. I guess I was examining the Alan Jones personna, more from a sexual repression point of view. Maybe if he had been more open about his sexuality, he would not be as angry. I don’t know.

  31. chrisl unless I’m missing something you are still trying to cancel that Co2 however long those particular molecules takes to cycle through the system.

    So at the moment the answer is yes, though I’ve already looked in freighter cruises and there is more press recently on the co2 benefits of taking the train.

    On flights in general I’ve also read that it has been suggested that the standard operating ceiling comes down plus there should be no night flights.

    My advice sell shares in airlines and tourism heavily reliant on air travel as it will be slugged when global enforced emission caps are introduced.

  32. simonjm
    Would it be even remotely possible to plant enough trees to take up the co2 produced by all the planes flying up and down and back again?
    And the plantation tree planters stand accused of taking too much water,thus not allowing runoff into the streams!
    By the way if you are thinking of flying to Melbourne(low level,during the day) remember that there isn’t a train there(unless you walk to Broadmeadows)

  33. Trees are not the best solution, algae farming could provide the solution as salt water could be used. Alternatively the add iron to the ocean to encourage more natural algae. It might mess up the eco-system but then again so will high temperatures.

  34. The good news: I got a letter on the topic of my Negative Payroll Tax hobbyhorse into the Weekly Telegraph.

    The bad news: they edited out my references to the likes of Professor Kim Swales of the University of Strathclyde, whom God preserve, and to my own games theoretic work on the area. Any casual reader who comes across it will think “this fool does not know that incidence is what counts, not impact, and therefore his suggestion is irrelevant, immaterial and unconstructive”.

    (Anyone who thinks that I just might know what I am talking about, right or wrong, feel free to look at my publications page for further and better particulars.)

    Con, your comments about “The problem with Austrian economics and hard core libertarians” don’t stand up on their own, thus:-

    – “there would be no internet”; possibly not the particular thing we have now, evolved from Arpanet, but most likely something. The thing is, it took communications technology plus a critical mass of communicators. Did either of those require a government kickstart? Did either get other alternatives squeezed.crowded out by the actual government versions we had?

    – “compulsory superannuation”; again, how much of the need was itself artificially generated? Aleutian Islanders provided for their old people in other ways, so this is far more a comment on the government mediated situation than on some underlying need addressed by a government solution.

    – “universal healthcare; see above.

    – “congestion charges”; again, without centres, would such centralised solutions be necessary in the first place? Until the industrial era, almost the only reason for large population aggregations was central spending. After that, location issues modified the simplistic understanding of Von Thun’s description (thus, Birmingham). However, it isn’t these aggregations that suffer most from such congestion, Birmingham itself shows the fallibility of planned solutions, and there is every reason to suppose that free market responses to congestion include dissipating the aggregations, not compensating for them.

    – “gun control”; well, that is in part a technological question, and in part an ethos one. It is certainly unsound to arm the police and disarm the people, so what of this vaunted gun control? Sadly, gun control does not actually work to diminish atrocities, given that the atrocious can find so many alternatives. I would suggest reading Perrin’s “Giving up the Gun” for a fuller insight of what is involved.

    – “climate change policies”; er, these are in place? That is even before deciding whether the problem is real (which I believe) or whether the proposed solutions are sound (which I doubt, based on our short termism and an insight into Pilot Induced Oscillation).

    – “workers rights”; again, this is a partial solution to a partly self created problem, much like minimum wages by fiat. Far better to engineer out the need.

    – “compulsory seatbelts for safety”; partly, a less infantilised people would react better, and partly, it’s no damned business of anyone else’s anyway (arguments of cost to health systems that are passed on to the general public are in fact arguments against such systems).

    I appreciate that raising these questions is not a disproof of the earlier assertions, but it does show that the examples are of open questions, not of established matters.

    Even if it “lies in the la la land of dreams with very little practical real world applications”, it has at least the merit of a reference point – the usefulness of fruitful error or of a good theory. The lack of practicality merely reflects on the crowding out, and is a symptom of the underlying deeper problems.

    As for “Before debunking central planning (and it should be treated with suspicion) think of the many infrastructure programs and works that have been successful due to central planning even by the ‘so called’ elites. Just think of central park in New York, Big Bang fianancial [sic] services in London, Snowy Hydro scheme. This is evidence of central planning that works.” – Well, only in the sense that it achieves what it sets out to, not that either it is worth it or that it was a good idea in the first place. Without artificial conurbations like New York (grown on the back of the Erie Canal), much of that land would be open now anyway. The Big Bang financial services
    would have been unnecessary. The Snowy scheme was a good idea, but was not properly amortised and financed, which is an omitted cost. And so on.

    “It is a shame in these days that you either have to be pure libertarian or social technocrat. We can be more realistic.” No, we cannot. True “pure libertarians” admit no compromise on points of principle – which does not mean that their ideas cannot be adapted, just that you should not kid yourself about being a little bit pregnant.

  35. chrisl carbon credits give other ways to offset other than just planting trees.

    Given I rarely fly as it is and when possible prefer to walk ride or take the bus it isn’t a big factor for me.

    I’m more on the side of lifestyle changes and offsets as a last resort.

    Unless they get fuel cell planes -we already have fuel cell trains- I wonder if we will see a return blimps as a form of air travel, I know a few companies are looking at them again for freight. Maybe even large ground effect planes maybe better.

  37. #6 Con, you are missing the point, the critique of central planning was not directed against particular infrastructure projects in the context of a market economy, it attacked the idea that a central planning body could determine all the production decisions in the economy.

    The more interesting aspect of the Austrian approach nowadays is to return the idea of human decision-making to the centre of the scene in place of mathematical models and cognate approaches that only work by making unrealistic assumptions.

    Click to access man_as_machine.pdf

  38. Thanks P.M Lawrence your fundamentalist views have been noted. Rafe you have a point regarding central planning determining all the production decisions in the economy. I’m just making the point that in any capitalist system there’s some central planning and to totally take ‘pure’ versions like P.M. Lawrence is fantasy.

    Finally Peter are you arguing that pure libertarians want decentralised non-clustering of people/resources? You should try living in New York (I do!) where many ‘libertarians’ love the idea of artificial conurbations. They network, gossip, manage hedge funds, play golf and being all too human, frequently compare assets/jets, mansions off the Hamptons and philanthropy. Same goes for Los Angeles (movie business), Silicon Valley (tech business) and Boston (Academia).

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