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Monday Message Board

March 23rd, 2010

It’s time, once again for the Monday Message Board. Post comments on any topic. As usual, civilised discussion and no coarse language.

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  1. Fran Barlow
    March 23rd, 2010 at 06:44 | #1

    America sure is a perplexing place.

    Some of the best science, the noblest of people, the most innovative music, literature and art has its origins in the United States. Some of the world’s most inspiring people have been Americans. Yet within the bounds of that jurisdiction lurk also the ugliest and darkest of human passions. I can’t imagine how you could count it but as the recent hysteria over health reform reminds us, they surely punch above their weight in numbers of unhinged and misanthropic people per capita.

    In America, it seems every group of psychopaths imaginable has a support group. There are “birthers”, creationists, open racists, gun nuts, states’ righters, anti-abortionists, death penalty proponents, people still fighting the Cold War and now, anti-tax populists, the people who think giving access to health care to millions of fellow Americans before they are on death’s door in a plan that looks like the Republican responses to Clinton in 1994 is the flagstone of the international socialist revolution. The latest rubric for this is the so-called “tea-party” movement, which is kind of apt, because watching on the TV last night, some of them did look like extras from a scen out of Alice in Wonderland.

    I’ve often wondered why this is so. America, as most know but forget, is not nearly as secular as one might suppose. One tends to think of countries like Iran or Saudi Arabia when one thinks of religious absolutism, but American fundamentalism is surely every bit as rooted at the level of the populace as in either of these places. The intersection of this religious foundation with slavery and the broader colonising and pioneering ethos has left scars which are still not healed. Watching the braying mob outside the Congress, and recalling those hurling racial epithets at Lewis the other day, one can see that there are people who aren’t happy if they can’t be part of a lynching.

    In June of 1933, Trotsky in a pamplet entitled What is National Socialism? wrote the following:

    The program with which National Socialism came to power reminds one very much – alas – of a Jewish department store in an obscure province. What won’t you find here – cheap in price and in quality still lower! Recollections of the “happy” days of free competition, and hazy evocations of the stability of class society; hopes for the regeneration of the colonial empire, and dreams of a shut-in economy; phrases about a return from Roman law back to the Germanic, and pleas for an American moratorium; an envious hostility to inequality in the person of a proprietor in an automobile, and animal fear of equality in the person of a worker in a cap and without a collar; the frenzy of nationalism, and the fear of world creditors … all the refuse of international political thought has gone to fill up the spiritual treasury of the new Germanic Messianism.

    Fascism has opened up the depths of society for politics. Today, not only in peasant homes but also in city skyscrapers, there lives alongside of the twentieth century the tenth or the thirteenth. A hundred million people use electricity and still believe in the magic power of signs and exorcisms. The Pope of Rome broadcasts over the radio about the miraculous transformation of water into wine. Movie stars go to mediums. Aviators who pilot miraculous mechanisms created by man’s genius wear amulets on their sweaters. What inexhaustible reserves they possess of darkness, ignorance, and savagery! Despair has raised them to their feet fascism has given them a banner. Everything that should have been eliminated from the national organism in the form of cultural excrement in the course of the normal development of society has now come gushing out from the throat; capitalist society is puking up the undigested barbarism. Such is the physiology of National Socialism.

    These people are not (yet) for the most part fascists, but that, in the midst of this profound disturbance in US and world capitalism, they have found their voice and congealed portends something quite ominous.

  2. Chris Warren
    March 23rd, 2010 at 08:11 | #2

    Forget Iceland, forget Greece, – now the real problem emerges: The IMF has finally, coyly, admitted that the whole capitalist world is bankrupt: see –

    http://tinyurl.com/IMF-debt-warning

    While we have just gone through a GFC primarily based on just housing finance; what happens when the same problems emerge across every sector of all capitalist economies.

    There were similar warnings with respect to housing debt, in the year in the lead up to the GFC, and this is now what is emerging for the next broader event.

    The tragedy is that debt can be easily controlled by Governments, but because of threats from capitalists, Governments do nothing, but hope that future population growth or some future ‘boom’ will solve all.

    So far I have noticed newspapers looking for a ‘education exports boom’, ‘yellowcake boom’, and ‘China boom’.

    As ever, the underlying problem, is to get rid of capitalism. It is the only way the world will survive.

  3. March 23rd, 2010 at 08:36 | #3

    The Victorian Government’s War against Wildlife

    After the Epping community, including a school teacher, school children and volutary wildlife carers worked for months to plan to relocate 21 kangaroos trapped by the Victorian Government’s irresponsible overdevelopment of the area, the Victorian (so-called) Department of Sustainability sneakily, behind everyone’s backs, had the kangaroos killed.

    A memorial for the murdered kangaroos will be held on Sunday 28 March at 2pm at Oleander Drive off McDonalds Rd in South Morang.

  4. Ernestine Gross
    March 23rd, 2010 at 09:07 | #4

    I have a question about taxation, specifically about GST.

    GST is a goods and services tax. Suppose a decision is reached on a positive carbon tax of x$ per t of ghg emission. I say GST should be calculated on the before carbon tax amount because carbon tax is meant to deal with a negative externality in the production process.

    Any opinions?

  5. March 23rd, 2010 at 09:22 | #5

    So, Chris – an admission that many governments have overspent and are close to bankruptcy means that it is the time to hand more power over to governments, huh? Yes, I can understand that sort of logic.
    So, next time a bank is looking shaky, I suppose you would advocate making that bank the central bank? Perhaps compelling us to deposit there?
    Hmmmm, “interesting” logic at best.

  6. March 23rd, 2010 at 09:26 | #6

    EG,
    In a tradable (per Rudd) system the permits are a financial instrument and therefore GST exempt.
    If a carbon tax is imposed it would be very difficult to impose the GST on a before CT amount as the CT amount would be bundled up in the final cost of the goods and services supplied.

  7. Fran Barlow
    March 23rd, 2010 at 09:28 | #7

    @Ernestine Gross

    Thye right to dump effluent is a service like any other and making special rules for CO2 would thus be a subsidy. GST gets imposed last in my opinion.

    After all, the full value of GST is returned to the public in one form or another. Of course, an ETS could avoid this problem.

  8. paul walter
    March 23rd, 2010 at 09:33 | #8

    Well done Fran Barlow for an exegesis that so fully explains the SA Election, Australian politics at the mo, in fact global politics and globalisation as directed from the bread and circuses plebs of Ozark county, Arkansas, USA, in their imposed ignorance, as presented by MSM.
    Big busines wants to takeover something else somewhere; media upsets the rednecks and they’ll call for an invasion and bloodshed, which politicians will not resist for the basis upon which de facto world government is predicated upon, eg “democracy”is nothing more or better than the conditioned responses of manufactured or real idiots; the vote of the plebs.

  9. Tony G
    March 23rd, 2010 at 09:35 | #9

    Chris W said;
    “As ever, the underlying problem, is to get rid of capitalism. It is the only way the world will survive.”

    Chris, only a commo could make such a statement. Maybe you missed ‘the wall’ coming down after 65 years of communist dysfunction?

    Fran, if you think the US is on the threshold of facism you are definitly delusional.

  10. Chris Warren
    March 23rd, 2010 at 09:43 | #10

    @Tony G

    It is simple, simple intellectual rigor.

    If you read political economy properly (Ricardo, Smith, Marx, Keynes) then it is clear that capitalism leads to social and economic collapse.

    This has nothing to do with your concepts at all.

    So when will the wall between the United Sates and Mexico come down?

    When will the wall through Gaza come down?

    What do you want? walls coming down, or banking systems crashing to the ground.

    Maybe people like you should forget about walls for a while and attend to deeper issues.

  11. Fran Barlow
    March 23rd, 2010 at 09:49 | #11

    @Tony G

    Fran, if you think the US is on the threshold of facism (sic) you are definitly (sic) delusional.

    You obviously don’t read for meaning. I made no such claim. The teaparty delusionals remain a tiny and noisy minority, the numbers of which are very probably inflated by the lobbying firms acting on behalf paying people to show up and make the kind of spectacle that will get on TV. Most of them probably aren’t putative fascists.

    That they can exist at all in numbers big enough to be the subject of regular discussion tells us something about unresolved aspects of US culture and the need to find rational solutions to problems of human need.

  12. Chris Warren
    March 23rd, 2010 at 09:53 | #12

    @Andrew Reynolds

    Andrew the problem is not just ‘governments have overspent’.

    The problem, in its current guise, is debt of all types, public, private, and derivative.

    But this debt problem, ranted-on about by Keen and Co., is a mere symptom of a general crisis tendency that can also manifest itself as, inflation, unemployment, or impoverishment of the population (or any mixture of these).

    We have the debt problem now, because capitalists in the 1980′s and 1990′s struggled with the inflation/unemployment symptoms then bursting forth.

    They (Keating, Hawke, Thatcher, Regan) did not tell us that they were only making matters worse for future generations in 2010.

    Today’s debt is yesterday’s unemployment and inflation.

    The only way to solve the debt crisis is to skyrocket unemployment or inflation.

    The only way to solve unemployment and inflation is to skyrocket debt.

    This is capitalism, irrespective of government.

  13. Tony G
    March 23rd, 2010 at 10:31 | #13

    Chris W said;

    ” it is clear that capitalism leads to social and economic collapse.”

    Where is the evidence for that?

    One thing is clear, keeping a costly bloated government at bay and its filthy hands out of peoples pockets, is the best way to stave off social and economic collapse.

    Sorry Fran I must of misread it.

  14. Ernestine Gross
    March 23rd, 2010 at 10:35 | #14

    @Andrew Reynolds

    Thanks for your reply. If a carbon tax is levied at the source then the accounting problem you mention is not a serious one. I take it as given that a cap and trade (ETS) would not attract a GST. A carbon tas should leave GST revenue unchanged. It seems to me there are a few questions of detail left.

  15. Chris Warren
    March 23rd, 2010 at 10:42 | #15

    Tony G :
    Chris W said;
    ” it is clear that capitalism leads to social and economic collapse.”
    Where is the evidence for that?

    Derr…. Um…… where do you think?

    http://tinyurl.com/IMF-debt-warning

    Ann Pettifor’s “Debtonation blog” is also useful.

    The group ChristianAid has also produced useful analysis in the past, particularly on international aspects.

  16. James
    March 23rd, 2010 at 11:11 | #16

    @Chris Warren ,
    My understanding of the Chartalist account of monetary creation (which is perhaps the best available account atm) is that national debts, being debts that a nation creates in a currency which it itself endows with value, are not capable of “bankrupting” a country in any meaningful sense. “Unlike the mainstream rhetoric, insolvency is never an issue with deficits. The only danger with fiscal policy is inflation which would arise if the government pushed nominal spending growth above the real capacity of the economy to absorb it.” Austerity programs and balanced budgets are like medieval hair shirts – the suffering impresses onlookers with your piety to the faith (of neo-liberal mercantilism) but it doesn’t actually achieve anything.

  17. Chris Warren
    March 23rd, 2010 at 12:00 | #17

    @James

    A proper, natural, money creations, including some appropriate debt, is not capable of bankrupting a economy.

    Deficits by themselves are mundane and threaten no-one.

    The problem arises when any entity pushes spending above the real capacity of the economy, cycle after cycle.

    However national and personal debt, created as a bailout, stimulus, or to fund capitalist price structures is not of this type.

    There is good debt, and bad debt. Inflation and debt are, in essence, the same phenomena.

    However it is also possible to conceive of a totally debt-free, interest-free economy. What happens to IS-LM then?

  18. TerjeP (say tay-a)
    March 23rd, 2010 at 12:09 | #18

    EG – in practice I suspect that it does not matter a whole lot whether GST is applied or not. For exported goods GST does not apply. For goods consumed domestically a given cap under the ETS will set a higher carbon price if GST does not apply and a lower one if GST does not apply. Either way the cap will be met and the same amount of revenue extracted. It may however have implications for how much the states get. For reasons of administrative simplicity I think GST should apply. I believe this is currently the case with fuel taxes.

  19. TerjeP (say tay-a)
    March 23rd, 2010 at 12:22 | #19

    Chris – if by capitalism you mean government bailouts of private banks and businesses, government debt to fund adventureous wars, economic stimulus packages and government spending oriented towards consumption and the pump priming of demand rather than investment in core infrastructure then I share your sentiment that these things should be brought to an end. However such folly is rooted in ancient tradition and I doubt anything you or I might wish for is going to suddenly change the direction of society. Some key institutions may collapse or come to pass buy I suspect the debate about statism versus markets will be raging a hundred years from now just as strongly as it does today.

  20. Sam
    March 23rd, 2010 at 12:54 | #20

    TerjeP, I have heard you say previously that CO_2 emissions reductions should be achieved through a revenue neutral carbon tax. This means we would have to cut some other tax. I’m quite sympathetic to this idea, provided the tax change didn’t include any increase in regressivity (along the income scale) of the tax system.
    Since the GST is also regressive, it would seem an obvious candidate. Say, for every $10/ton we could cut the GST rate by 2%. Those numbers are just wild guesses, but probably not totally wrong. You may argue that this society should increase it’s tax regressivity anyhow, but surely climate change mitigation should not be mixed up in that debate.
    Much the same result could be achieved with an ETS, so long as no permits were given away to polluters. It would then just be a bit harder to estimate how much GST you should cut, for every cut in allowable emissions. What does everyone think of this? TerjeP, if you don’t agree with me, what other kind of tax would you cut?

  21. March 23rd, 2010 at 14:21 | #21

    EG,
    I think that, as the GST is an input tax then the prices of those inputs affect the amount of tax raised. If there is a meaningful carbon tax then that would (by necessity) flow through to GST revenue. If, however, this was balanced by a reduction to other taxation to leave overall revenue unchanged I would expect that GST revenue may also be substantially unchanged – but with sectoral changes as the sectoral impact of a CT would be unlikely to be matched by the sectoral impact of any tax reduction.
    .
    Sam,
    The problem with treating the GST in this way is that the revenue from the GST largely goes to the States and the impact of a CT would also disproportionately hit the States (through their owned coal fired power plants). The States could be almost guaranteed to stop it. If you thought that reducing regressivity was a good outcome, then (IMHO) rebalancing through the income tax system would be better.
    .
    Chris,
    It may be possible to conceive of a totally debt- and interest-free economy, but this is unlikely to be either economically efficient (in fact it is likely to be seriously injurious to the people living there) or something that can occur without serious compulsion. Debt and interest (or at least some compensation for the time value of money) are just too useful.

  22. Chris Warren
    March 23rd, 2010 at 14:28 | #22

    Andrew

    I see no reason why a debtinterest free economy would be inefficent. The distribution of incomes and goods would still be allocated to maximise utility.

    However debt and interest can create greater productivity which I think is the point you were trying to make.

    Please do not confuse efficiency with productivity.

    However capitalist debt and interest is different to normal debt and interest, so you have to specify what form of debt and interest you are cheering for (if any).

  23. March 23rd, 2010 at 14:35 | #23

    Chris,
    Perhaps you can clarify the difference between “capitalist” debt and interest and “normal” debt and interest before I respond fully.

  24. James
    March 23rd, 2010 at 14:45 | #24

    I also admit to not understanding Chris’ distinction here. Chris, you seemed to agree earlier that deficits are no big deal, but also argue that they are a major threat to the system.

  25. wilful
    March 23rd, 2010 at 14:49 | #25

    This is really angels on the head of a pin stuff, innit? I don’t see Chris Warren arguing for a completely debt-free economy, except as a theoretical construct.

    As a theoretical construct I can see some distant post-scarcity future where it could happen. But that’s just science fiction.

  26. Chris Warren
    March 23rd, 2010 at 15:25 | #26

    Normal debt means I issue a voucher today, that equals production tomorrow. The total amount of vouchers over a period equals the amount of production.

    Capitalist debt means I issue any number of vouchers today, controlled only by the interest rate.

    In the second case – if tomorrow’s production is insufficient, then I issue more vouchers to pay-off the old ones. The amount of vouchers over a period does not equal the amount of production.

    IN the first case the observed rate of profit (the key economic signal) equals the rate of wealth growth.

    In the second case the observed rate of profit (the key economic signal) equals the quantity of paper.

    The first is sustainable with no population increase or sales outside the economy.

    The second is only sustainable as long as either population increases or the relative amount sold outside the economy increases.

  27. Ernestine Gross
    March 23rd, 2010 at 15:45 | #27

    AR,

    GST may look like an input tax from a company’s point of view but it is a consumption tax on domestic consumption. I am quite sure about this. Again thanks for your reply. This is a manageably small technical problem, which, IMO, can be quite easily discussed in blog conversations as we do.

    Terje,
    In a full information economy (everybody has the same information and all of it), your argument about ETS prices for ghg emissions would hold, assuming everybody agrees that a GST should be levied on the price of ghg emissions. I am not convinced this is how it works in practice. Further, my point was about a carbon tax (ETS certificates do not attract a GST according to AR and he tends to be pretty accurate on the regulatory rules; so I take it as a given). I still maintain that a carbon tax should not attract a GST in addition. I know one can undo the effect by suitable redistributions but this involves a lot of paper work. At present it seems to me the simplest way of having a carbon tax is to tax at the source and applying GST before the carbon tax. More specifically, a carbon tax should be applied only to the emissions generated by the physical production and not attract a GST in addition. To illustrate, an electricity bill would have the following components:
    a) Sales price per unit *unit price (including carbon tax)
    b) carbon tax
    c) GST on (a)-(b)
    Total

    (I know, given public information on carbon tax per unit, consumers could deduce, approximately, how much they pay for overheads!)

  28. Chris Warren
    March 23rd, 2010 at 15:58 | #28

    @wilful

    Wilful is right.

    Modern society benefits from debt, we just have to object to capitalism.

    And in fact that is all.

    If there is no scarcity, then there is no political economy.

    Could there still be debts? I really do not know.

    Presumably, even in abundance, various endowments could be shifted to maximise utility. Could debt assist this?

  29. March 23rd, 2010 at 16:14 | #29

    EG,
    Most companies respond to the GST as an input tax (as you normally have to pay it on your input before you receive value from your outputs) so at a micro level that is what (IMHO) it is. If the sum of all these micro interaction is somehow to transform that into an output tax then I would have to bow to you on that. I just cannot see how that happens.
    .
    Part of the difficulty in any tax system is complications and I would think that this method of levying GST would be more complicated than is necessary. As I said up the thread, the GST is (at least in theory) paid straight to the States who, through their electricity utilities, would also be high payers of the tax.
    Calculating the CT on an individual unit of power may be reasonably easy, but this would then neglect the other elements of the CT that would have an impact on the final power bill – like the cost of cement, transport and many other things that are bundled up in the final bill.
    Would it not be much simpler just to levy the GST on the full amount of the whole lot and then, by calculation, compensate for the increase GST revenue in other ways for example reducing or eliminating payroll tax? This would then result in a simple tax that targets carbon emissions directly.
    .
    Chris,
    You seem to have a misunderstanding of the process of bank lending, falling for the old Rothbardian / Social Credit idea that somehow banks can lend out unlimited funds. They cannot. If they could, no bank would ever fail as all they would need to do would be to create more money for themselves through more lending. This misconception is driven by looking at the circular flow of funds (a process) in static form.
    In fact, the process you have identified as the “normal” process is the one that happens as a normal consequence of business. The only real source of more “vouchers” (by which I take it you mean money) is government or, in a specie system, the production of more specie.

  30. March 23rd, 2010 at 16:41 | #30

    Chris,
    If I may make a further observation – you also seem to have a misunderstanding of what “capitalism” is. At least from my point of view, capitalism is what results when you let people get on with their lives with a minimum of interference. It can also be called “freedom”. All of the faults you have so far pointed to as those of “capitalism” seem to me to be the faults that arise from interference by non-capitalist sources – i.e. the State.

  31. Ernestine Gross
    March 23rd, 2010 at 16:57 | #31

    AR, I can’t agree with you on the GST. A company pays per period, say per quarter, the difference between GST on sales and purchasings (alternatively put, GST on invoices it issues (receivables) and GST on invoices it receives (payables). This amount may be negative, in which case the ATO sends a cheque. It is a value added tax paid at the final consumption stage (hence consumption tax). It is not an output tax. I am quite sure about this.

  32. TerjeP (say tay-a)
    March 23rd, 2010 at 16:58 | #32

    You may argue that this society should increase it’s tax regressivity anyhow, but surely climate change mitigation should not be mixed up in that debate.

    Sam – I agree that we should avoid confusing these debates. And in terms of general tax cuts I think there is a good case for making the system more progressive in the short term by agressively inteasing the tax free threshold.

  33. Chris Warren
    March 23rd, 2010 at 17:10 | #33

    @Andrew Reynolds

    HUh? Misunderstanding of capitalism.

    You are pulling my leg.

    Everyone knows that capitalism is investing capital where it makes maximum profit (and politically manipulating society to maximise this process).

    Capitalists make the greatest profits where there is less freedom.

  34. TerjeP (say tay-a)
    March 23rd, 2010 at 17:12 | #34

    p.s. One approach I like is to index the tax free threshold each year by the rate that ensures no net increase in averge tax revenue per capita (inflation adjusted and for all taxes). In the early years the tax system would become much more progressive as low income earners lose a big chunk of their tax burden.

  35. TerjeP (say tay-a)
    March 23rd, 2010 at 17:14 | #35

    Chris – your ultimately engaged in a semantic argument then. Nobody publicly argues for the system you call capitalism. Those that advocate capitalism don’t mean what you describe.

  36. Sam
    March 23rd, 2010 at 17:15 | #36

    TerjeP, but specifically, would you cut the GST in order to introduce a revenue neutral carbon tax?

  37. TerjeP (say tay-a)
    March 23rd, 2010 at 17:16 | #37

    p.s. What you call capitalism is close to what I call neo-socialism.

  38. TerjeP (say tay-a)
    March 23rd, 2010 at 17:21 | #38

    Sam – GST would not be my first choice. I rather cut payroll tax or fuel tax. And I’d increase the tax free threshold before cutting GST. Likewise cuts to stamp duty on property purchases (the house moving tax) or the tariff on textile imports (our clothing tax). GST would be low on my list but I would cut other regressive taxes.

  39. Chris Warren
    March 23rd, 2010 at 18:14 | #39

    @TerjeP (say tay-a)

    Follow the dollars, not the labels.

    This fiddling with words is only a tactic of last resort.

    Capitalists know how to extract profit, irrespective of what their greed is called.

  40. Alice
    March 23rd, 2010 at 18:44 | #40

    @TerjeP (say tay-a)
    What any sane person would call laissez faire is what Terje calls” capitalism”..but then Terje never did have the common insight of the sense of order a capitalistic system needs that most of us have instinctively

    As well (thank the lord for the rest of us..Terje and his ilk have never fully experienced the utter disorder he so craves, only partially and not nearly enough to change his stubborn mind – when the rest of us are already screaming “enough”).

  41. March 23rd, 2010 at 19:41 | #41

    Chris,
    If that is the case then we are all capitalists. All of us know how to extract profit through such activities as selling our labour, investing or lending our savings and even such prosaic activities as working around our home. We also all know how to profit our communities by doing community work, donating to charities and other such activities.
    Only the scale differs.
    Congratulations, Chris. On that basis you are a capitalist.
    The important point with a free system is that we are able to make decisions of our own accord on what is, or is not, something we want to do. We also have to bear the responsibility for those decisions.

  42. Alice
    March 23rd, 2010 at 19:53 | #42

    @Ernestine Gross
    Of course it is Ernestine. GST is a tax on consumption instead of income. It is meant to grab the tax when it comes out of an individuals pocket on spending – rather than into a persons pocket as income (as income tax does).

    Its meant to catch people who work in the cash economy on the assumption that if they dont declare trheir income at least they spend it and will pay GST on their consumption.
    Trouble is it catches old folks who do declare their income and income taxes should have been reduced to match the imposition of the GST exactly. This never happened to the correct proprtions (ie income tax was not reduced to the xtent it covered GST impact fully) – so it is a tax on a tax and it is regressive being a flat rate. That hurts the poor.

    It has also turned thousands of small – medium and large businesses into defacto tax collectors for the ATO – forcing them to work out and pay quarterly BAS. The accountants have had a field day, the ATO save money but small business is smothered in a layer of regulation they dont need – collecting GST for the ATO.

    I dont know what Andy is rambling on about. I dont think he gets the GST impact but thats not unusual.

  43. Chris Warren
    March 23rd, 2010 at 20:37 | #43

    Andrew

    You probably realise by now just how much you misunderstand.

    Anyone can profit from their own labour. On the other hand, capitalists profit from others labour – this is what “extract” means.

    The scale is not even relevant. Extracting 20cents from a worker is capitalism, making $100 from your own labour is not.

  44. March 24th, 2010 at 08:41 | #44

    Alice,
    It is usual that you do not understand. Don’t worry, you may one day actually be employed in the real world.
    .
    Chris,
    So – governments are by their very nature capitalist? They “extract” a lot more than 20c from every worker out there.
    If this is not the case, what do you mean by “extract”?

  45. Fran Barlow
    March 24th, 2010 at 09:24 | #45

    @Andrew Reynolds

    So – governments are by their very nature capitalist? They “extract” a lot more than 20c from every worker out there. If this is not the case, what do you mean by “extract”?

    If you are referring to taxes, then this formulation is misleading. Governments (even capitalist ones) don’t “extract” money from workers. They move value (less the transaction cost) from one part of the economy to another, whereas the value extracted from workers by capitalists becomes the property with which the capitalist extracts value from other workers.

  46. Chris Warren
    March 24th, 2010 at 11:18 | #46

    Andrew is getting closer.

    Yes, governments extract from workers and business owners.

    However, now that you have got your toe dipped into the water, you should be aware that capitalism arises, not totally because of this extraction (which also occurred under fuedalism), but when the extract is reinvested to extract more.

    Although you will not understand this: capitalism is represented by:

    M – C – M’

    A two stage process. The extraction is stage 1.

    When democratic governments extract, they do not necessarily use this fund to generate profits for themselves. They tend to use the funds for non-capitalist bandaids.

    Capitalists rant and raille and winge and cry about this all the time.

  47. March 24th, 2010 at 12:11 | #47

    Chris,
    You seem to be operating with cardboard cut outs, both of “workers” and of “capitalists”. Let’s get a little more clarity, then.
    I am trying to work out what makes a “capitalist”. Say I employ a team of builders to build a house for me to live in. Am I being a “capitalist” if I do this once? How about if I do this twice, selling the first house to pay for the second? Have I extracted value from the workers that built my house if I only do it once and then pass the benefits on to my children or does it take me doing it twice before I have “extracted” value?

  48. Fran Barlow
    March 24th, 2010 at 13:04 | #48

    @Andrew Reynolds

    Say I employ a team of builders to build a house for me to live in. Am I being a “capitalist” if I do this once?

    If the house is not constructed as part of a regular process aimed at become a property investor then no, you aren’t. The contracting company are likely to be capitalists who emply builders. The builders themselves could be independent contractors i.e. petit bourgeois. If you are a property developer than you are one or other kind of rentier capitalist.

    Ultimately, being a capitalist of one kind or another entails profiting from trade in labour power (or seeking to).

    One may profit from trade in articles (such as when I use ebay to sell some personal effect, but unless I do this for a living I’m not a a capitalist. If I do it for a living I am a merchant petit bourgeois. If I emply people in my business then I am a merchant capitalist.

    Ultimately though the labels are not really all that interesting since it’s not capitalists we care about politically but the consequences attending capitalism as a system.

    One of these — the appropriation of surplus labour power — is of especial interest to us because it lies at the root, not only of social inequality, but of the persistent and recurrent crises within the system as a whole which in turn lead to stagnating and declining social production and the stalling of human progress.

  49. March 24th, 2010 at 13:13 | #49

    Fran,
    I know several people (most of them teachers) who do this on a regular basis – they buy a house and do it up and then move on two or three years later, mostly directly employing the people that they know and trust to do the work well. Most of the time this is a profitable little sideline for them and compensates them for the comparatively low wages they earn as teachers. Would you say that they are contributing to “not only … social inequality, but [also] the persistent and recurrent crises within the system as a whole which in turn lead to stagnating and declining social production and the stalling of human progress”?
    All they are doing is renovating houses using willing workers paid at rates the workers are happy to accept for the work supplied. Should they not be allowed to do this or would you do something else to reduce or eliminate the “…the stalling of human progress…” that you seem to think comes from this behaviour?

  50. Fran Barlow
    March 24th, 2010 at 13:43 | #50

    @Andrew Reynolds

    Would you say that they are contributing to “not only … social inequality, but [also] the persistent and recurrent crises within the system as a whole which in turn lead to stagnating and declining social production and the stalling of human progress”?

    In that case I wouldn’t. The problem is not that teachers or those positioning themselves to become househopping merchants. It is the system that makes equity in housing a tradeable commodity that is the problem.

    Perhaps it is your particular libertarian paradigm that is the problem, but you seem have to have a near-mechanical impulse to focus on individuals as instantiations of the system as a whole, as if these individual acts authored the system as a whole, when this is nearly the opposite of the case — it is the system as a whole and what it permits that authors individuals and their activities.

  51. March 24th, 2010 at 15:07 | #51

    Fran,
    I always find that if you focus on the system you end up being unable to see the wood for the trees – to me it is the individual that matters and societies that lose site of that end up with some of the horrors we have seen over the last century.
    .
    I am genuinely trying to understand your position, though, so I will need to work through some examples.
    .
    Let’s go back to looking at “equity in housing a tradeable commodity” as being a (not “the” as I presume you see there are more problems than simply that) “problem”. Why is this a problem? Let’s make it simpler – I do all of the work myself to renovate the home, building considerable value out of an almost unliveable shell partially through my own work but also (possibly) . Do you think that I should not be allowed to benefit from my own labour under those circumstances or have I missed something?

  52. Fran Barlow
    March 24th, 2010 at 15:13 | #52

    @Andrew Reynolds

    I do all of the work myself to renovate the home, building considerable value out of an almost unliveable shell partially through my own work but also (possibly) [unclear: FB]. Do you think that I should not be allowed to benefit from my own labour under those circumstances or have I missed something?

    Context: In this system, of course you should. Of course, one might conceive of system in which it would not be possible to have equitable title in housing. Housing might be part of the commons and the structural elements looked after through general social provision, in which case you would have no such labour from which to profit.

  53. March 24th, 2010 at 15:29 | #53

    I can conceive of many things. To be more specific – would that be a system you would support? If so, how would housing be allocated between the potential users of the general social provision of that housing? Once housing was allocated by this process how the the providers ensure that it was appropriately maintained and that it continued to be allocated reasonably efficiently?

  54. Fran Barlow
    March 24th, 2010 at 16:03 | #54

    @Andrew Reynolds

    be more specific – would that be a system you would support?

    Yes … I would

    how would housing be allocated between the potential users of the general social provision of that housing?

    An algorithm would be devised to select among housing applicants 9assuming they exceeded the available housing at the price required), weighting them on the basis of need, capacity to pay, waiting time and demographics in order to predispose a viable community within given housing complexes and estates.

    Once housing was allocated by this process how the the providers ensure that it was appropriately maintained and that it continued to be allocated reasonably efficiently?

    There would be something rather like a strata title body charged with ensuring those things needed to meet the state housing quality standards were undertaken. This would be drawn from within the pool of tenants and other stakeholders and would have ex-officio at least one qualified financial officer, a building engineer and would be audited for compliance by an independent person once every two years. Suitable permanent staff would be on site to carry out day-to-day maintenance. All of these would receive stipends for service commensurate with the time involved from the state. The people from the complex on the board would be drawn from the stakeholder community by sortition from those nominating. The state could intervene much as it can with local councils to sack dysfunctional boards or remove members guilty of malfeasance.

    The funds for this would be drawn from rental receipts and where necessary, this would be topped up on a formula by state funds — (for example, where the complex was charging lower rents due to having a substantial percentage of people on concessional rent due to them being on comparatively low income). Where the complexes accumulated surpluses, these could be repaid to tenants in dividends pro-rata.

    Vacancies would be filled as they arose on the same basis.

    The complexes themselves would arise from proposals produced by people who had formed themselves into housing coops and who had drawn up plans that met housing targets for each district and conformed to local environment plans. When a proposal was finally approved, the state would either put the proposal out to tender and fund construction, or the co-op itself would and receive a loan guarantee and go on to be the initial body corporate. The duty to do the debt service would fall upon each body corporate out of rental receipts.

  55. March 24th, 2010 at 16:44 | #55

    Fran,
    An interesting idea, but I can see a large number of practical (or at least I think practical) questions that arise form it.
    Would that not require a huge bureaucracy with all of the attendant waste?
    What would happen if someone was not happy with their allocation and wanted to do something else – say an individual wanted to express their own personality on their own dwelling? Would they be able to form a co-op of one?
    What scope would there be for individual expression in housing or would all of the houses be strictly regulated to conform to a given standard to reduce cost?
    If you are doing this on a community basis (as it seems you are) how are you going to avoid the ghetto issue, where the people who put together the co-op effectively exclude others?
    If someone was on a low income but wanted a comparatively expensive flat you seem to be indicating that the State would top up the payments. How would this be justified?
    .
    I have seen suggestions like this before, but AFAICS they would normally founder not on the point of ideals but on how it is practically implemented.

  56. Chris Warren
    March 24th, 2010 at 20:10 | #56

    @Andrew Reynolds

    Andrew Reynolds :
    Say I employ a team of builders to build a house for me to live in. Am I being a “capitalist” if I do this once?

    No (I assume you paid the workers with vouchers you earnt legitimately.)

    How about if I do this twice, selling the first house to pay for the second?

    No (I assume the house was sold on the open market)

    You can get wealthy by your own efforts or earnings. It is up to workers through their unions to ensure decent wages, in the knowledge of the real value of a completed house.

    If you deliberately avoid a union workforce, and employ oppressed workers on cheap wages – then you are a capitalist.

  57. Fran Barlow
    March 24th, 2010 at 22:28 | #57

    @Andrew Reynolds

    Would that not require a huge bureaucracy with all of the attendant waste?

    It’s hard to see why. Most of the compliance would be done locally by the stakeholders with the state merely auditing for compliance. If anything, there might be less bureaucracy than we have now.

    What would happen if someone was not happy with their allocation and wanted to do something else – say an individual wanted to express their own personality on their own dwelling?

    The same restrictions as apply in any body corporate would apply, within the overall LEP and other general provisions of course.

    What scope would there be for individual expression in housing or would all of the houses be strictly regulated to conform to a given standard to reduce cost?

    Proposals for complexes would take broad objectives into account but the diversity of the provision would be at the initiative of the proposers. Presumably they would bring a serious plan to the table that could be reconciled with the demographic mix the state was aiming to achieve. This would be evidence-based and probably rely on the experience of other comparable developments.

    If you are doing this on a community basis (as it seems you are) how are you going to avoid the ghetto issue, where the people who put together the co-op effectively exclude others?

    As I said above, the precise mix would be weighted to predispose the spread of results wanted in a random sort. Nobody could be rejected because they were poor or the wrong colour. The random sort would be run and would closely match the targets. Those passed over would automatically have their chances incremented on other applications, so the system wou,ld be self correcting.

    The mix would prevent ghetto-like conditions.

    If someone was on a low income but wanted a comparatively expensive flat you seem to be indicating that the State would top up the payments. How would this be justified?

    They would be able to apply for any place but they would only get marginal financial assistance for those meeting the acceptable quality standard in terms of space per person. Those getting assistance would not be allowed to get it at all if bidding more than 30% of household income, after recurrent obligations were deducted. Those not getting assistance could bid as much as they liked and this in turn could allow them to augment their chances of selection within their demographics.

  58. TerjeP (say tay-a)
    March 24th, 2010 at 22:32 | #58

    My father worked as a builder. He built homes for people and subcontracted out the electrical and plumbing work as well as some of the earth moving etc. However he did pretty much all the carpentry and similar such tasks himself. He made what I regards as a very modest income from doing this. He grew up in Denmark and his father was a union rep there and when he arrived in Australia he did join the carpenters union at first. However something must have changed his outlook along the way because growing up as a kid I recall he was always keen to avoid working on construction sites which required him to be in a union. I recall he did it once when work was scarce and he got a bit desparate but he didn’t like it. I think he felt somewhat intimidated by the conduct of the unions and regarded some of their behaviour to be unethical and thuggish. I don’t think he was oppressed by avoiding unions or by working for people who had no interest in employing unionised workers.

    I’ve had one job in my life that required me to be in a union. I quit after a short time because I hated it. I think there is a legitamate place in society for unions but I must admit that in practice I tend to have a quite visceral distaste for them. In my own life and in the life of those that I know I can’t see that they ever did much that was positive.

  59. Chris Warren
    March 25th, 2010 at 07:24 | #59

    So terjeP

    Maybe you hate Australian, being forced to pay taxes, and follow all these oppressive road rules.

    Maybe you feel intimidated by traffic lights.

    Do you feel intimidated by the thuggish behaviour of banks and employers.

    Maybe your dad should have migrated to Falkland Islands.

    As you spread your “visceral distaste” remember that people will see you in the same light.

    Explain to your Dad, that if unions had not maintained Australian wages, his attempts to make a modest income would have been jeopardised by being out-competed by Australian oppressed working conditions.

    He benefited by the standards set by others, as a lousy free-rider.

    He could have stayed in Denmark

  60. March 26th, 2010 at 11:03 | #60

    Save South East Queensland’s koalas from Bligh Government/developer greed

    The same selfish vested interests that want to turn our suburbs into sterile concrete jungles are also driving our iconic koala into extinction.

    If Queensland’s current runaway population growth continues, further encroachments upon the habitat of our endangered iconic koala are inevitable, practically guaranteeing their extinction from South East Queensland. Yet Premier Anna Bligh, by having renamed the ‘population summit’ to the ‘Growth Summit’, has told Queenslanders she is no longer interested in considering the one chance we have to save our koala, that is, population stability.

    I include below a letter from the Save Our Koalas rally organisers.

    Dear Koala Supporters,

    We asked what you wanted to do in response to the Queensland Government’s upcoming Growth Summit, and an overwhelming majority of you want to let Anna Bligh know that the Koala is more important than unlimited growth in Australia.

    We need to send a message loud and clear to Anna Bligh and Kevin Rudd, that rushed development will have a catastrophic effect on Koala populations in SEQ, our lifestyles and our biodiversity, and that it could cause the extinction of the koala.

    Rally outside the main entrance of Queensland <a href="State Library, Southbank, Brisbane at 11.00am Tuesday 30th March 2010.

    For further information: contact: saveourkoalas[AT]gmail.com

  61. smiths
    March 26th, 2010 at 11:46 | #61

    i wrote recently that i thought the current physics model of space and its formation was childish,
    this story is an example of the observations which are being made and will continue to be made that make the theories seem flawed

    In 2008 scientists reported the discovery of hundreds of galaxy clusters streaming in the same direction at more than 2.2 million miles (3.6 million kilometers) an hour.
    This mysterious motion can’t be explained by current models for distribution of mass in the universe. So the researchers made the controversial suggestion that the clusters are being tugged on by the gravity of matter outside the known universe.
    http://news.nationalgeographic.com/news/2010/03/100322-dark-flow-matter-outside-universe-multiverse

    i suppose we will get years of controversial patch theories before we get a thorough rethink

  62. TerjeP (say tay-a)
    March 26th, 2010 at 12:08 | #62

    Chris – I don’t hate Australia. Every country has it’s problems and a good patriot works to elliminate or mitigate those problems. I think labour market regulation in Australia is a problem. And I think our union movement has some cultural problems although they were worse in the past. I don’t accept your characterisation of trade unions as the source of workers prosperity.

  63. Chris Warren
    March 26th, 2010 at 20:17 | #63

    TerjeP

    You probably don’t know much about 18th century working conditions, 19th century campaigns for the 8hr day and old age pensions, and 20th century campaigns for annual leave, OHS standards and the rights of female workers.

    All these campaigns clearly ensured greater prosperity for Australian workers.

  64. TerjeP (say tay-a)
    March 27th, 2010 at 06:43 | #64

    Chris – I’m not convinced that the old age pension was a positive thing as it shut down the alternate aged income systems that were being developed through civil society, including by trade unions in fact. However I never said that unions had never done anything positive. I said that the union movement has some cultural problems, and I was actually thinking of the last 50 years not the last 200 years when I said it.

    In terms of prosperity I don’t dismiss the fact that unions have helped frame that propserity (ie safer workplaces etc) however I don’t accept that they have advanced wage rates beyond what would occur naturally in a growing economy.

  65. Chris Warren
    March 27th, 2010 at 12:18 | #65

    TerjeP

    But of course the public old age pension is positive compared to alternative systems, and trade unions in the last few years have done a wonderful job fighting off a very right-wing “liberal” government.

    The real cultural problem in Australia has come from rightwing capitalists such as Pauline Hanson, rightwing wars such as the first Gulf War, plus the fraudulent invasion of Iraq, and of course the rancid rightwing persecution of Haneef.

    But of course there is also the cultural problem of sex-molesting priests (of all types).

    But I suppose you might have concerns for the cultural problems that led to the stolen generation in the past 50 years, plus the more recent Windschuttle denial of crimes against humanity at the base of Australia.

    Finally there is a cultural problem between workers wages (dictated by laws and awards), and consumer prices with freedom to reach any height the market will bear. Under capitalism the natural tendency is for wages to fall and profits to rise, even in the last 50 years.

    So it seems that capitalism breeds its own culture. This can mislead people.

  66. TerjeP (say tay-a)
    March 27th, 2010 at 13:56 | #66

    Pauline was an odd sort of capitalist if she was one at all. I’ve disagreed with the Iraq war but I don’t see how it is relevant to trade unions and whether they are the source of worker prosperity. Likewise I don’t see the relevance of child sex abuse or child abduction. You seem to be suggesting that multiple wrongs make a right but to be honest I can’t really tell.

  67. Alice
    March 27th, 2010 at 14:09 | #67

    @TerjeP (say tay-a)
    I’ve disagreed with the Iraq war but I don’t see how it is relevant to trade unions and whether they are the source of worker prosperity. Likewise I don’t see the relevance of child sex abuse or child abduction.

    Interesting train of thought there Terje P. I not sure I see the link myself between collective bargaining by way of unions and well…the latter point you make…..
    Im certainly not sure than unions can be classed as “a wrong” Terje. There are lots of useful things about union activity Terje…its never was all beefy tatooed blokes and strikes and self interested politicians climbing from out of unions into the ranks of political leaders.
    They also act to protect employees rights from exploitation by employers. The demise of union and union activity (under joint assault from both sides of politics since the 1980s) has seen inequality climb and has resulted in inequitable workplace abuses. Union busting and hobbling has been part of the neoliberal extremism that needs to be partially unwound (as it has been with the widespread rejection of workchoices legislation which gave unprecedneted individual bargaining rights on the assumption that the employee has the same or similar power base from which to argue their case, as the employer. They dont Terje. What has been passing for individual workplace bargaining in this country has resulted in the “youth abuse” in this country. In one sense I guess I can see a link between child abuse and lack of regulation in the labour market…..

  68. TerjeP (say tay-a)
    March 27th, 2010 at 14:22 | #68

    Alice – if you have been following the debate you would know that I never said unions were wrong. I said:-

    1. Unions have a legitamate role to play in society.
    2. Unions have had some cultural problems.
    3. In practice I have not liked the unions I have encountered.

    Nowhere did I say the existance of union was wrong.

  69. Chris Warren
    March 27th, 2010 at 15:03 | #69

    @TerjeP (say tay-a)

    If you cannot see the relevance of these examples of capitalist “culture” why did you evoke some trade union “culture”.

    If you want to get onto one track at #14, why jump off at #16 just because it does not lead where you want.

    The issue is not Hansen, Iraq war, molesting priests, etc; but the need for those who want to pick on unions for “cultural problems”, to be consistent and include all the other cultural problems in society.

    But when faced with this – they jump track, quick smart.

    So if you are going to carry on about unions supposedly having some “cultural problems”, why not compare these to the cultural problems of Hansonism, Churches, Iraq war, racist culture behind Haneef’s mistreatment, and the Reithite culture behind Chris Corrigan?

  70. TerjeP (say tay-a)
    March 27th, 2010 at 15:52 | #70

    Chris – I don’t need to list all problems in society every time I wish to discuss one of them.

    For what it is worth I’m not interested in defending the views of Hansen the Iraq war, child molestation or abduction. I accept that these entail lousy values but that does not mean I can’t talk about trade unions. And just because lots of areas of society have faults that does not mean my points about the trade union movement are invalid. It seems to me that you are merely trying to create some form of diversion.

  71. Chris Warren
    March 27th, 2010 at 16:08 | #71

    Not diversion, but relevancy.

    If cops just arrest aboriginals for crossing double lines, their false behavior becomes apparent to those who see many others crossing double lines.

    It is no defence for the cops to say: “I am not interested in discussing line crossing by whites, or asians. We accept that these also cross double lines but this does not mean I can’t take action against aborigines.”

    “Just because everyone crosses double lines does not mean my action against aboriginals is invalid.”

    I suppose in this situation, of a false, biassed perspective, the cops would certainly try to claim that their accusers are “merely trying to create diversion”.

    But the rest of us will see straight through this pretence.

  72. iain
    March 27th, 2010 at 17:18 | #72

    Fran Barlow :@Andrew Reynolds

    Would you say that they are contributing to “not only … social inequality, but [also] the persistent and recurrent crises within the system as a whole which in turn lead to stagnating and declining social production and the stalling of human progress”?

    In that case I wouldn’t.

    I would.

    For capitalist apologists, Andrew’s housing development appears as normal and legitimate. It is surely “direct social relations between individuals at work” creating value for themselves and providing housing for others (potentially). A win for everyone, no doubt.

    For others, obviously, this is just another sad case of “material relations between persons and social relations between things”.

    Where are the materials coming from? At what environmental cost? Material relations between persons mask this cost.

    What is the social benefit of Australia’s housing pyramid scheme? Why does the so-called value of property renovation justify indentured slavery for many under 25 wanting to enter the property market? Social relations between things mask this cost.

  73. Alice
    March 27th, 2010 at 18:17 | #73

    @iain
    Iaian – I might just add that the housing price rises to the extremes of unaffordability co-incide rather niceley with tax breaks given to “investment property owners” – now this goes back to sometime mid nineties – someone correct me if I am wrong.

    Call me a cyncical old biddy – but I suspect the constant tinkering with superannuation and the lack of access to that form of savings in terms of liquidity, suspician re governments uses and abuses of large pools of quarantined super (and for that matter abuses by super fund managers and back room investment advisers) made a lot of people suspicious…including the already wealthy who are not slow to see what gives the best return and what doesnt.

    Net result….there are a whole lot of spare funds that piled…not into super but into real estate in this country. Dont trust the sharemarket? Dont trust financial sector? Dont trust government?

    Why the hell wouldnt people pile it into bricks? They did en masse in Australia. Its another way of saying “I want control over my savings…not you (financial firm/government etc)

    Distortions all round by people other than savers getting a $$$$$$ kickback from individual personal hard earned savings. Real estate was the last of the relatively safe refuges and even that isnt safe now because every man and his family piled into that market. No-one asks why.

  74. Alice
    March 27th, 2010 at 18:21 | #74

    @iain
    Iain

    You are better off asking Andy – who works in the financial markets in some sort of banking role – why is he so enamoured with doing up real estate to sell…

    Maybe because it (real estate tart ups) has been working better for Andy than the banks and financial firms he so loyally supports in many of his previous posts.

  75. Alice
    March 27th, 2010 at 18:41 | #75

    @TerjeP (say tay-a)
    I just found it interesting that you co-joined the idea of unions and childmolesting Terje – and then said two wrongs dont make a right…

    You werent attempting to introduce the idea that unions are a horror were you Terje?

    No you wouldnt have been trying to do that…surreptiously…at all.

    You must think we came down in the last shower Terje.

  76. TerjeP (say tay-a)
    March 28th, 2010 at 05:01 | #76

    Alice – I did not raise the issue of child molestation. Chris did in comment #15 paragraph 3. Specifically he said:-

    But of course there is also the cultural problem of sex-molesting priests (of all types).

    I made no reference to the issue before that. And my references to it subsequently were to point out that it has nothing to do with whether there are cultural issues in the trade unions movement. Chris was trying to co-join these issues not me.

  77. TerjeP (say tay-a)
    March 28th, 2010 at 11:20 | #77

    Alice – I suppose there is no chance of an apology.

  78. TerjeP (say tay-a)
    March 29th, 2010 at 14:02 | #78

    I’m still open to an apology.

  79. wilful
  80. March 30th, 2010 at 16:07 | #80

    Chris,
    I would agree that those who “…deliberately avoid a union workforce, and employ oppressed workers on cheap wages” deserve some censure. The idea of employing anyone on an “oppressive” basis I find repugnant. That said, on whom should the burden of proof be? If I advertise for someone to come and do same (say) bricklaying for me and offer to pay (say) $1 per brick laid then is it part of my responsibility to enquire about that person’s circumstance to see if they are a union member or that the terms could be considered “oppressive”?
    If it is not the employer’s role to do that then there is little philosophical difference between us on this.
    .
    Alice,
    Was that the previous comment where I said that bankers and others should be prosecuted for any criminal activity on the same basis as the rest of us – or some other comments?
    .
    Fran,
    On your first response: I would think that the development and maintenance of any such algorithm would be an enormous and complicated task. Given the algorithm would also be responsible for making one of the most important decisions for each and every one of us (where we get to live) I would think there would inevitably be a large amount of appeals against it output. I am not convinced that this would be as simple as putting some numbers into a system and then having the residence decisions for millions of people spat out the other end.
    On your second: Again, I would think that this would cause some real disputes. Trying to come to a simple decision on this I simply cannot see that it would be an easy, cut and dried case.
    On your third: As with the others this then involves what would need to be a long and complex argument, with appeals against decisions happening almost almost as a matter of course. While the current system sometimes ends up with appeals through the court system I cannot see this system as reducing complexity. Having been on the receiving end of these disputes in the past All I can see here is people arguing the point ad nauseum.
    The other major problem I could see in there is simple – corruption. The system you have proposed seems to rely heavily on the output of an algorithm, a fairly “black box” approach once you have millions of small inputs and millions of important outputs. Those writing the system would have a strong incentive to build things into it that favour either themselves or those close to them – or those that pay them. This then means that there would need to be a large supervisory body (a small one would just mean that they become easily open to corruption themselves), meaning more cost.
    Sorry, but I cannot see how this would be any of simple, efficient or cheap. While in theory this may make some sense all I can see is a bloated, expensive monster making seemingly arbitrary decisions not on behalf of the general welfare, but on behalf of those who run the system.

  81. Fran Barlow
    March 30th, 2010 at 16:17 | #81

    @Andrew Reynolds

    Andrew, I think you are massively overstating the problem. The current system has its own “algorithm” based largely on stuff that is far harder to get at and specify and what it spits our is inequity and inefficiency.

    There’s no problem at all auditing these things and aside from purely technical appeals — where the onus should be on the plaintiff to show error — I see no scope. To qualify you’d have to waive most of your rights to litigate.

    Since people have no rights at all in housing allocation now, I don’t think many would be bothered.

  82. March 30th, 2010 at 16:55 | #82

    Fran,
    The “algorithm” at the moment is one that operates largely without any central authority telling us where we can, or cannot, live – this is down to our individual needs, wants and abilities (including financial capacity). Most people can see the logic that if they cannot afford something, even with debt, then they cannot have it. If there was a system that allowed them to afford something but still not to have it because of some mathematical equation then I would think that they would be much more likely to dispute it – even if they may appreciate that it gave good answers for everyone else.
    What would happen if a person did not waive their rights to litigate? Would they simply be excluded from the system?

  83. Alice
    March 30th, 2010 at 17:40 | #83

    @Andrew Reynolds
    Andy – it totally escapes me where I have addressed a single comment to you in this thread…yet I have two responses from you, one where you accuse me of not living in the real world and some other response.

    I have absolutely no idea what you are talking about.

  84. Alice
    March 30th, 2010 at 17:42 | #84

    @TerjeP (say tay-a)
    No apology Terje – see your post at 16 where you cojoined the idea that unions and child molestation were two forms of wrong. Dont deny it Terje and dont be flippant with your responses. The suggestion is there. You are clearly suggesting unions are some form of moral wrong.

  85. Alicia
    March 30th, 2010 at 18:03 | #85

    @TerjeP (say tay-a)

    Personal whinging anecdote.

    Study some labour history and come back to us and then a sensible discussion about trade unions may be possible.

    Otherwise you just insult everyone’s intelligence.

    Something “libertarians” do habitually. Funny about that.

  86. TerjeP (say tay-a)
    March 30th, 2010 at 18:56 | #86

    Alice – if you take my comment in the context of the discussion it ought to be more than clear that the wrong refered to corrupt cultural practices within some unions and not unions as a concept. Comprehension isn’t one of your strong points is it?

  87. Alice
    March 30th, 2010 at 19:05 | #87

    @Alicia
    I agree with Alicia Terje – get over it. Subtle suggestions that unions are a moral evil is your strong point. Im not short on comprehension Terje – your anti union innuendos dont wash with me.
    Did you know Terje that one of the reasons that inequality has been on the rise for three decades has been researched and found to be the product of union bashing and dismantling by both sides of the political spectrum (including Hawke who made his way up through the unions and admits to instilling the priorities of the rich – what a cop out Hawke was). If you want to support and live in a world where elites, class and birthrights rule – move to Europe Terje. No loss to me, here in Australia, at all.

  88. Alicia
    March 30th, 2010 at 19:13 | #88

    “Libertarians” all – prove me wrong – are people (overwhelmingly male) who “once” were a member of – or had some vague but never to be forgotten dealings with – trade unions, but whose entire adult employment experience consists of being isolated small business or sole trader types typically working in IT/sales/finance.

    Not a very culturally representative or insightful segment of humanity. And invariably boring and ignorant as batshit.

  89. Fran Barlow
    March 30th, 2010 at 21:02 | #89

    @Andrew Reynolds

    The “algorithm” at the moment is one that operates largely without any central authority telling us where we can, or cannot, live – this is down to our individual needs, wants and abilities (including financial capacity).

    Or, put another way, the algorithm you like operates to ensure access to quality housing is determined exclusively by wealth and social privilege. Mine makes these much less significant. Since the vast majority of the populace are on the wrong end of this algorithm, the class of potential beneficiaries is huge.

    I’ve never heard of anyone litigating the Lotto result, and if this lotto ensured that everyone got a fair chance at winning, I can’t imagine anyone litigating. The algorithm would be much like any other piece of public policy, and the implementation could be transparent — like the lotto draw.

    What would happen if a person did not waive their rights to litigate? Would they simply be excluded from the system?

    Of course. Participation would involved accepting that no correspondence would be entered into, save the claim of clear malfeasance, corruption or error, and then the only relief would be another draw. Since even the losers get an incremented chance at the next draw, they have an incentive to accept the result.

  90. TerjeP (say tay-a)
    March 30th, 2010 at 21:10 | #90

    Did you know Terje that one of the reasons that inequality has been on the rise for three decades has been researched and found to be the product of union bashing and dismantling by both sides of the political spectrum

    No I didn’t know that. Do you care to cite the research? Has it been peer reviewed?

    If you want to support and live in a world where elites, class and birthrights rule – move to Europe Terje.

    No I don’t and no I won’t. It’s too cold in Europe.

  91. Alice
    March 30th, 2010 at 21:19 | #91

    @TerjeP (say tay-a)
    Terje –

    Im not here tro be your research assistant when you cant be bothered to do your own reading…Ill start you off (now go read on teh link between loss of unions and unons activity and rising inequality).

    http://www.nber.org/papers/w6520

    Buy yourself a warm coat and move to Europe.

  92. March 31st, 2010 at 13:29 | #92

    Fran,
    It is not only wealth and social privilege. I am not from a wealthy background, nor from one that would be counted as socially privileged, yet I have access to quality housing. To be honest, compared to what housing was like a century ago then just about everyone has access to quality housing now.
    As for the “waiving” of rights, you are essentially saying that either you give up your rights to protest or you do not get a home. That, if I may suggest, is not a recipe for freedom, it is highly oppressive. If you attempted to allocate employment on the same basis then I think you would see the issue there.
    .
    Alice,
    Terje is right – comprehension does seem to be a weak point. Try the one you addressed to Iain above that was pointed at me.

  93. wilful
    March 31st, 2010 at 14:15 | #93

    Actually Alice, it’s a reasonable request, when challenged on a fact, to provide your own linked evidence. You can’t wave that away by saying “I’m not your research assistant”, that’s very poor netiquette, it infers you really can’t prove what you were saying.

  94. Alice
    April 2nd, 2010 at 07:49 | #94

    @wilful
    says “Actually Alice, it’s a reasonable request, when challenged on a fact, to provide your own linked evidence.”

    Wilful – you obviously didnt notice the link in my post at 40. Would you like more linked evidence on the link between loss of union power and rising inequality over the past three or four decades?

  95. Freelander
    April 2nd, 2010 at 08:25 | #95

    ” I can conceive of many things. ”
    Talk about self parody.

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