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The reality wars are over. Reality won.

November 13th, 2012

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  1. Jarrah
    November 14th, 2012 at 21:33 | #1

    “Sure Jim, but tell me, would like a second or third power cable or water main running down your street ? This is how real competition works.”

    Early power and gas companies in the US did exactly that.

    “Private enterprise can also stuff up you know. Have you not heard of the GFC ?”

    That was a combination of market failure and government failure.

  2. Jordan
    November 14th, 2012 at 21:33 | #2

    @Jim Rose
    That still does not explain the reality that there is no market at monopolies, market which conservative use as argument that it will make monopolies better.
    Market does not exist for monopolies or network industries.
    Deffinition of monopoly….?
    So what is the true reason to privatize monopolies? When it is well known that government is providing services at bellow market price and equitably, hence automatic loss to budget but more then equal benefit to industry and people.
    Why to take away such huge benefit from industry and people? For whom is taken away?

  3. Ron E Joggles
    November 14th, 2012 at 21:36 | #3

    “The reality wars are over. Reality won.”

    If only this were true. Trying to be optimistic, the disastrous consequences of the over-burdening of our poor, unappreciated planet are ever more apparent and this can only become the general view. But that won’t change the mindset of those who believe what they prefer to be true, and the shift in position will soon be rationalized away.

  4. Jim Rose
    November 14th, 2012 at 21:50 | #4

    Jordan, if the government wants to see a service sold at below cost, they can subsidise it out of the budget, plain for all to see. prescription drugs are subsidised.

    why did the government own TAA? airlines are not a natural monopoly.

  5. Jim Rose
    November 14th, 2012 at 22:03 | #5

    Jordan, you did not look very hard for negative consequence of high debt or deficit in USA. Obama has presided over the weakest recovery since the Great Depression:
    • Government Policies and the Delayed Economic Recovery. Editors: Lee E. Ohanian, and John B. Taylor, September 02, 2012.

    • The Economic Crisis from a Neoclassical Perspective by Lee Ohanian. Journal of Economic Perspectives, Fall 2010, pp. 45-66.

    • Ellen R. McGrattan & Edward C. Prescott, 2012. “The labor productivity puzzle,” Working Papers 694, Federal Reserve Bank of Minneapolis.

    • Fiscal Sentiment and the Weak Recovery from the Great Recession: A Quantitative Exploration by Finn E. Kydland and Carlos E. J. M. Zarazaga, 2012

    John Taylor has published too many papers to mention since 2007 on how bad government policies are prolonging the great recession

  6. Jordan
    November 14th, 2012 at 22:05 | #6

    @Jim Rose
    do you plan to ignore most of my questions?
    I was really hoping that while searching for answers you would be able to see the reality, … ah ..well
    Why did the gov. own TAA? don’t know.
    Maybe you know why did gov. own internet?
    Or atomic bomb? Or nuclear reaserch for power source? Or why did gov. own satelites? GSP? Or why does government own money?
    Do you know?

  7. Jordan
    November 14th, 2012 at 22:09 | #7

    @Jim Rose
    I guess you are trying to say that gov. debt is taking away from private investment at 1% interset rate. Are you really serious?
    1% interest profit is more attractive then 3% or 5% interest profit???
    Whom are you kidding?

  8. rog
    November 14th, 2012 at 22:09 | #8

    The reality is that despite four years of wilful and obstructive behaviour the Repubs were unable to gather sufficient support to lead govt. They must now compromise or take the full blame for the consequences.

  9. Jim Rose
    November 14th, 2012 at 22:09 | #9

    Jordan, many of your questions are answered in the links provided and at http://johnhcochrane.blogspot.co.nz/2012/11/debate-with-goolsbee.html#more where cochrane argues that
    ” by what economics is the central key to escaping sclerotic growth that we should sharply raise marginal tax rates on investment and business formation? When, ever, has a society experiencing sclerotic growth restored robust prosperity by a tax-based redistribution?”

    perhaps you could answer this question?

  10. Jordan
    November 14th, 2012 at 23:44 | #10

    @Jim Rose
    I can not answer that question because i never thought about it and i do not know if anyone is proposing to do it that way, but i can answer this question;
    ” by what economics is the central key to escaping sclerotic growth that we should sharply raise marginal tax rates xxxxxxxx? When, ever, has a society experiencing sclerotic growth restored robust prosperity by a tax-based redistribution?”
    I erased from your question that which noone is proposing or suggesting in order to answer it.

    Lets imagine an equilibrium economy. with everything constant and everyone spends all income and everyone is employed and capital is constant 0% inflation. Equilibrium.
    Everything is fine, but oops, someone is born, another mouth to feed, to school, to clothe. But since it is equilibrium that new person will stay unemployed and to be fed and clothed it has to be taken from someone else. And now it is a same amount of money but more people, what will happen?
    Same amount of money but more food and clothes needed, what will happen?
    What will happen in equilibrium if one person get to keep more and more money while the amount of total money is same?

    We are not in sclerotic growth, we are in sclerotic recovery.
    Any sclerotic growth with cash reserves of the companies high and extreme wealth aslo high and majority of people without good income and with high unemployment, like we are in now the answer to boost the economy is high marginal tax rate. Or transfer of frozen wealth to those that will use it or need it and which will go back to those on the top again and send it down trough tax again and again. It is called surplus circulation as Yanis Yaroufakis calles it (even tough he applys it mostly to global movement of money and trade).
    It is called SURPLUS CIRCULATION. Since it is heterodox term i will explain it again.
    Movement of money in economy
    ->wealthy (or who has money and idea)->worker->product->wealthy->worker->
    YOu see the movement from wealthy trough production to workers who buy products with money going back to owners. It is a circle of money flow.
    Now if you cut the flow and stop it at one place which naturaly is at the wealthy and keep accumulating it. Can you make the wealthy keep the circle flowing if he will lose by keeping the flow like in deflation would happen? no you can not. Except by taxes, which will redistribute that accumulated capital (frozen) to the ones that will now have enough to buy products the wealthy produce.
    It is frozen capital, or in todays case it is frozen at government debt since there is no other place to invest, there is no buyers (poor workers) of possible products.
    Capital would freeze in stock market too since price of stocks are no benefit to companies, stock prices are reflection of a company’s equity value. There is no benefit in capital inflow to companies past IPOs.
    Surplus not as in Marxists sense but in discretionary income, savings sense. Savings that will never, never be used for products or services, or never be invested into production.
    Surplus as in so much wealth that it will be frozen in financial assets that will only produce more wealth that will never be spent on services. Something like investing capital on capital to produce more capital. It is frozen in productive sense.
    So such surplus has no way of reaching production and purposeful use unless taxed and redistributed to those that will use it.

  11. Jordan
    November 14th, 2012 at 23:51 | #11

    The period of most prosperous growth of USA was with the highest marginal tax rate ever 94%.
    Period between 1950-1965 in communist Jugoslavia which had really progressive tax was of world record growth average 12.7%. for 15 years.

  12. Jordan
    November 15th, 2012 at 00:26 | #12

    Or to use simpler wording.
    High marginal tax rate is a way to move capital from unproductive part of GDP to productive part, trough those that will benefit from and know how to use it best. From investing capital on capital (frozen kapital) to investing in production.
    Amount of money or GDP number itself will not change. For that you need to print money, since private banks won’t do it anymore, there is too much risk for banks, then the government must in order to raise GDP number itself and with that to reduce deficit.

  13. Jordan
    November 15th, 2012 at 00:44 | #13

    Here is much better explenation of SUrplus circulation but about global and EU and euro problem with solutions.
    There is two more seminars in Materials and archive
    http://www.modernmoneyandpublicpurpose.com/seminar-3.html

  14. Michael Mouse
    November 15th, 2012 at 01:50 | #14

    “The reality wars are over. Reality won.”

    True iff you adjudicate who won by reference to reality. Which is kinda taking a side in the whole war, which is, tragically, ongoing. Seems some people just don’t know when they’re beat – in reality.

  15. Jim Rose
    November 15th, 2012 at 05:42 | #15

    Jordan, marginal taxes are about one-third higher in the major EU states so per capita incomes are about 1/3rd lower that the USA.

    the Swedes had the third-highest OECD per capita income, almost equal to the USA in the late 1960s, but higher levels of income inequality.

    By the late 1980s,Swedish government spending grew from 30 percent of gross domestic product to more than 60 percent of GDP. Swedish marginal income tax rates hit 65-75% for most full-time employees as compared to about 40% in 1960.

    Swedish economists encountered a new phenomenon they named Swedosclerosis:
    1. Economic growth slowed to a crawl in the 1970s and 1980s.
    2. Sweden dropped from near the top spot in the OECD rankings to 18th by 1998 – a drop from 120% to 90% of the OECD average inside three decades.
    3. about 65 per cent of the electorate receive (nearly) all their income from the public sector—either as employees of government agencies (excluding government corporations and public utilities) or live off transfer payments.
    4. No net private sector job creation since the 1950s, by some estimates!

    In 1997, Lindbeck suggested that the Swedish Experiment was unravelling.

    Sweden is a classic example of Director’s Law. Once a country becomes rich because of capitalism, politicians look for ways to redistribute more of this new found wealth to the middle class.

    HT: http://www.project-syndicate.org/commentary/the-three-swedish-models

  16. Savvas Tzionis
    November 15th, 2012 at 06:45 | #16

    Can someone explain to me why, in Obama’s first post election speech, the only ‘sound-bites’ I heard were about tax cuts, and not just to the rich?

  17. Jordan
    November 15th, 2012 at 07:21 | #17

    @Jim Rose
    Where are important statistics?
    Why do you consider the growth as all important? What for?
    If there is an equilibrium and no population rise, why would you expect the growth?
    What do you need the growth for?

  18. Ernestine Gross
    November 15th, 2012 at 07:53 | #18

    For a very long time, I find the discussions involving Jim Rose very amusing. It is like observing a randomisation process in verbal arguments under the control of Jim Rose.

  19. Jordan
    November 15th, 2012 at 08:02 | #19

    Important statistics are unemployment rate and wealth distribution.
    Sweden has the most equal wealth distribution in the world.
    Bottom 20% people hold 19% of wealth
    Secong quintile 20%
    Third 20%
    fourth 20%
    top quintile holds 21 %
    Income distribution and tax scheme made it so equal.

    Usually the reason for growth is to have healthy economy, to fight inflation and low unemployment.
    But reality is that growth is needed to follow the population growth so that they have jobs available for new people entering the economy and inflation is there so that there is new money to cover for new products needed for new population.
    I was asking the questions in hope that you will try to answer them. In hope that you will see what are your priorities but to no avail.
    You were probably thinking that answers are too obvious, but they are not. They reveal motivations for such economic philosophy that has no purpose but to make rich richer.
    While the central purpose of economic philosophy should be full employment, reduced suffering and maximised prosperity.
    All your conservative philosophy is for making rich richer.
    In todays time technology is such that all food and production needed for survival is done with about 15% of workers, food with only 1% population, rest of them is to make life easier and nicer for everyone. But no, some wants it all for them only.

  20. Jordan
    November 15th, 2012 at 08:08 | #20

    @Ernestine Gross
    Isn’t that how usual argumenting with conservative goes? Loosing an argument then jumping to another one in order to avoid conceiding the point.
    The conservative reasoning process most probably look the same as their arguing process.

  21. Bring back Birdy at Catallaxy
    November 15th, 2012 at 09:48 | #21

    The forces of unreality still have to be dislodged from their island sanctuary to the north-west of Europe.

    http://www.bbc.co.uk/news/uk-northern-ireland-20321741

  22. Jim Birch
    November 15th, 2012 at 13:04 | #22

    @Jim Rose

    why did the government own TAA? airlines are not a natural monopoly.

    I think you might have history backwards here. The government created TAA to counter the ANA monopoly, didn’t it? TAA and ANA/Ansett-ANA acted a bit like a duopoly for a long time, but they did pioneer safe, good quality air transport in Australia when no one else wanted to. The feeling at the time was that TAA kept a lid on what Ansett might charge.

    It is possible to evaluate these things in terms of cost-benefit. Public and private systems have advantages and disadvantages which can be more-or-less evaluated in economic terms rather than relying on abstract value systems. I don’t know if you’ve ever been in business but the universal objective is to charge customers as much of the utility of the product as you can get away with, where public services only have to cover costs. This may or may not be a big issue. Private is typically better where genuine competition conditions exist because it is usually more innovative and responsive, but not always, eg, the US highly-privatised health care system costs about twice per capita as much any other country to provide a service with outcomes that equal countries spending a tenth as much.

    What beats me about you guys is that you are happy to pull a magical principle out of somewhere that precludes one option.

  23. Ikonoclast
    November 15th, 2012 at 14:20 | #23

    @Ernestine Gross

    Yes, in some cases it is best not to argue or engage in discussion with certain posters. More generally, it is interesting to consider how many people have ever changed an opinion via blog argument and associated (personal) research prompted by said blog argument.

    I have changed one personal view. Namely, that I now view some renewable energy EROEI (wind and solar esp.) as sufficient to sustain our economic systems (along with the associated and necessary energy savings) and thus avert a fossil fuels peak energy crisis.

    I now leave in the air the question of whether world economic growth can continue much longer. However, I have my doubts and suspect that if not an energy shortage then other material shortages, species extinctions, climate catastrophes and over-population will halt real economic growth within a decade or two.

    Ernestine’s and JQ’s severe doubts about some (many?) aspects of MMT have given me pause and made me more cautious about MMT claims. However, I am still a Keynesian with a Functional Finance twist in pragmatic terms and a kind of a Green Marxist with an evolutionary rather than revolutionary bias in “academic” and idealistic terms.

    Unless corporate, oligarchic capitalism is at least morphed into a kind of worker collective capitalism (where the capital belongs to the workers’ collective of each enterprise rather then to capitalist owners, “rentier” shareholders and executive managerialists) then I see little chance of the economic system or the entire political economy ever being properly responsive to the legitimate right and needs of the workers and the masses of ordinary people.

  24. ts
    November 15th, 2012 at 16:32 | #24

    Ikonoclast :@Ernestine Gross I now leave in the air the question of whether world economic growth can continue much longer. However, I have my doubts and suspect that if not an energy shortage then other material shortages, species extinctions, climate catastrophes and over-population will halt real economic growth within a decade or two.

    Malthusian predictions have invariably been proved wrong throughout history, though it never stops people making them and changing the terms of prediction once disproved.

  25. Jordan
    November 15th, 2012 at 17:02 | #25

    @Ikonoclast
    Yes i thought so too, in some cases is better to leave them be, like in cases when due to lack of contradictory arguments readeship dwindles so that blogers are forced to beg friends to contradict comments to spark discussions. Maybe JIm Rose was such case.

    I do not believe that we can keep heating the earth at this pace and not cause more issues. Even tough i believe it is the heat energy that is taken from earth and placed into atmosphere more of a problem then C02 emmissions. It is like placing a giant heater on earth and expect not to get wormer. So even solar project trap more energy and keeps it here on earth, not nearly as much as fosil fuels but still..

    I am also proponent of worker cooperatives but in evolutionary ways not revolutionary as you say and the idea is slowly building up to the critical mass.
    Tough, there is a problem with it too. I am from Croatia, former Yugoslavia republic where worker collectives were implemented in the whole country after WII. I am learning more and more about resons why it did not succed.
    The main reson was the private property instinct, wish to keep the gains in power and distribution. There was a rulling class, a bit tougher to find it in worker collectives, but there was a rulling class.
    It was a bureaocracy within collectives that decided distribution of surplus and they steared it to themseves slowly but more noticably. Reforms in 1963 tried to deal with it and failed. Praxis schoolars argue that it was the middle level of state aparatus that prevented reforms which aimed to spread collective power of workers themselves from factory level to national level. State top administration with Tito and Kardelj wanted to do reforms but republic bureaocracy which held distributive power did not. So they kept on thinking about preserving the privilege but economy needed constant work and development (central planing). Decission makers were more and more mired in preserving their status then solving the real problems in economy. They became inert and were doing only ad hoc solutions. With the pressure from kapitalist world and foreign debt Yugoslavia’s rulling class was easily lured into capitalist thinking and saw a loot that was theirs for taking, but fought a war over loot in the end.
    We are now private money neoliberal paradise.
    Same what happen with a lot of Sillicon Valley start ups that started as workers collective but switched to private ownership of those that started it as soon as there was a lot of profit to share. Private ownership instinct was stronger then collective philosophy.
    Richard Wollf had a nice description in his last Economic update on how to solve that. It will require a school system with emphasis on liberal arts education and civic purpose to prevent privat ownership instincts. But we see that those courses and schools are dissapearing in privatized systems.
    http://rdwolff.com/content/economic-update-puerto-rico-colony-and-laboratory

  26. Katz
    November 15th, 2012 at 17:23 | #26

    Obama’s real dad an American Communist. (Sorry Birthers.) and Obama’s mother a p*rnst*r.

  27. Ernestine Gross
    November 15th, 2012 at 17:29 | #27

    @Ikonoclast

    I have benefitted a lot from JQ’s blog and also from some commentators, you included. On political matters (where my ignorance was – or still is – most outstanding) I’ve reached a possibly temporary conclusion, namely: Sensible Labour and sensible Liberals and sensible Greens are all social democrates with slightly different shades of emphasis. The quality of the policies depend on the quality of the people whereby I would consider honesty to be a ‘key performance indicator’ for quality. The rest of them I call ‘neocons’ (the con bit is so ‘realistic’ in my subjective opinion, and I don’t have to distinguish between ‘left’ and ‘right’) in my private mental model. This is some progress, No?

  28. Jim Rose
    November 15th, 2012 at 17:58 | #28

    @Jim Birch did you forget the two airlines policy stopping new entry?

  29. Fran Barlow
    November 15th, 2012 at 18:02 | #29

    Rachel Maddow puts PrQ’s claim as strongly as one can:

  30. Jim Rose
    November 15th, 2012 at 18:09 | #30

    @Jordan google harold demsetz 1968 why regulate utilities. discusses how when there is so called natural monopoly, competition in the market is displaced by competition for the market. franchises can be used to replaced utility regulation with auctions to supply the market at the lowest price and cost.

    the franchising response to natural monopolies dates back to the 1850s.

  31. Jordan
    November 15th, 2012 at 19:46 | #31

    @Jim Rose
    Was there a reason for privatising utilities?

  32. Ikonoclast
    November 15th, 2012 at 19:48 | #32

    @Fran Barlow

    The lady nails it.

  33. Jordan
    November 15th, 2012 at 20:24 | #33

    @Ikonoclast
    Yes i thought so too, in some cases is better to leave them be, like in cases when due to lack of contradictory arguments readeship dwindles so that blogers are forced to beg friends to contradict comments to spark discussions. Maybe JIm Rose was such case.

    I do not believe that we can keep heating the earth at this pace and not cause more issues. Even tough i believe it is the heat energy that is taken from earth and placed into atmosphere more of a problem then C02 emmissions. It is like placing a giant heater on earth and expect not to get wormer. So even solar project trap more energy and keeps it here on earth, not nearly as much as fosil fuels but still..

  34. Jordan
    November 15th, 2012 at 20:29 | #34

    My post has not been moderated for 4 hours so i am reposting it in two parts
    @Ikonoclast
    I am also proponent of worker cooperatives but in evolutionary ways as you say and the idea is slowly building up to the critical mass.
    Tough, there is a problem with it too. I am from Croatia, former Yugoslavia republic where worker collectives were implemented in the whole country after WII. I am learning more and more about reasons why it did not succed.
    The main reason was the private property instinct, wish to keep the gains in power and distribution. There was a rulling class, a bit tougher to find it within worker collectives, but there was a rulling class.
    It was a bureaocracy within collectives that decided distribution of surplus and they steared it to themseves slowly but more noticably. Reforms in 1963 tried to deal with it and failed. Praxis schoolars argue that it was the middle level of state aparatus that prevented reforms which aimed to spread collective power of workers themselves from factory level to national level. State top administration with Tito and Kardelj wanted to do reforms but republic bureaocracy which held distributive power did not. So they kept on thinking about preserving the privilege but economy needed constant work and development (central planing). Decission makers were more and more mired in preserving their status then solving the real problems in economy. They became inert and were doing only ad hoc solutions. With the pressure from kapitalist world and foreign debt Yugoslavia’s rulling class was easily lured into capitalist thinking and saw a loot that was theirs for taking, but fought a war over the loot in the end.
    We are now private money neoliberal paradise.
    Same what happen with a lot of Sillicon Valley start ups that started as workers collective but switched to private ownership of those that started it as soon as there was a lot of profit to share while new entrants became employees only. Private ownership instinct was stronger then collective philosophy.
    Richard Wollf had a nice description in his last Economic update on how to solve that. It will require a school system with emphasis on liberal arts education and civic purpose to prevent privat ownership instincts. But we see that those courses and schools are dissapearing in privatized systems.

  35. Chris Warren
    November 15th, 2012 at 22:46 | #35

    @Jordan

    The main reason was the private property instinct,

    I spent over a month touring workers councils and BOALs and studying associated labour in Yugoslavia in 1980. I have followed it since but not in detail.

    In my view the main reason was not “private property instinct”, but as you point out:

    It was a bureaocracy within collectives that decided distribution of surplus and they steared it to themseves slowly but more noticably.

    and

    Decission makers were more and more mired in preserving their status

    but importantly:

    foreign debt

    .

    Your comment:

    State top administration with Tito and Kardelj wanted to do reforms but republic bureaocracy which held distributive power did not.

    is interesting as Tito died in 1980. Are you suggesting that these problems disrupted selfmanagement in the 70′s.

    As I recall, strikes (mostly over workers income) increased in the 1980′s. Right-wing commentators often try to invoke some idealistic interpretation of apparent self-management failure. The far left (including anarchists) do also. These views can coalesce as in the case of the Yugoslav Praxis .

    You can see a right-wing misinterpretation in the British Journal of Political Science – v10, n3, July 1980: G. Shabad, Strikes in Yugoslavia: Implications for Industrial Democracy.

    Nonetheless, with this experience, the theory of associated labour and self-management is a viable form of alternative to capitalism. Whether this is by evolution or not, depends on circumstances, not theories.

  36. Chris Warren
    November 15th, 2012 at 22:55 | #36

    Jordan :
    @Jim Rose
    I guess you are trying to say that gov. debt is taking away from private investment at 1% interset rate. Are you really serious?
    1% interest profit is more attractive then 3% or 5% interest profit???
    Whom are you kidding?

    American capitalists prefer to invest millions at low interest, than thousands at higher interest.

    Fact of life. This also leads to Third World underdeveloped, because hopeful microstates able to service small loans are denied this opportunity as capitalist funds all swarm to larger economies.

    Borrowers seeking funds in Switzerland, even with good interest prospects were rebuffed, even as millions were made available to multinational corporations at lower rates.

    Bloody reality wins again.

  37. Chris Warren
    November 15th, 2012 at 22:56 | #37

    @Jim Rose
    I guess you are trying to say that gov. debt is taking away from private investment at 1% interset rate. Are you really serious?
    1% interest profit is more attractive then 3% or 5% interest profit???
    Whom are you kidding?

    American capitalists prefer to invest millions at low interest, than thousands at higher interest.

    Fact of life. This also leads to Third World underdeveloped, because hopeful microstates able to service small loans are denied this opportunity as capitalist funds all swarm to larger economies.

    Borrowers seeking smaller loans in Switzerland, even with good interest prospects were rebuffed, even as millions were made available to multinational corporations at lower rates.

    Bloody reality wins again.

  38. Jordan
    November 15th, 2012 at 23:37 | #38

    @Chris Warren
    It was a bureaocracy within collectives that decided distribution of surplus and they steared it to themseves slowly but more noticably.
    Private property instinct was cause of that. What else could be the reason behind bureaocratic spontaneous strugle to preserve privileges; selfishness, greed? I just call it private property instinct. We know how strong it is.
    In a situation where, theoretically, everyone is same, works and contributes the same, why would one distinct class develop? They had privilege to distribute a surplus. Due to private property instinct, they steered it to themselves.

    Full decade before ’80 this poped up and Praxis was banned in 1974. The privileged class got hurt by their writings.

    There were mass demonstration of students in ’68. Students were the kids of privileged class, and their demands were for more rights. From whoom?
    Student demonstrations in Zagreb in ’71, for more rights from centralized directives. They were all demonstrations for more privilege. Those that enjoyed privileges wanted more.
    The rulling class used the students for demonstrations, cause they were too afraid to do it themselves, and Tito’s reaction after ’71 proved them right.
    It was much later that workers started demonstrations, once the difference in benefits of regular worker in production from benefits of bureaocracy became too obvious. It was more then 10:1 distribution difference in a country where everyone was taught that we are the same. And contribution was skewed and distribution was skewed toward bureaocracy. Hence, it was too obvious to ignore. But to no avail for workers.
    First it were demonstrations for privilege to distribute, then much later demonstrations against unequal distribution.

    Tito and Kardelj reforms failed in 1967.
    Rulling class demonstration in 1968, ’71
    Workers demonstrations in ’80s

  39. Jordan
    November 15th, 2012 at 23:53 | #39

    @Chris Warren
    That was my attempt to make him think about it, and was hoping that he would answer; ok, market is broken, which is opening for another attack.

    Honestly, i did not consider that but was thinking more on the line that investing in production became too risky. With a default on credit, no interest rate can help returns on loans. And Treasuries are super safe.

  40. November 16th, 2012 at 01:47 | #40

    Reality might have had an election victory, but realpolitik keeps finding ways to make denial palatable policy, even as the problems increase – perhaps exponentially. The optimistic narrative is “constraints drive innovation”.

  41. Jim Rose
    November 16th, 2012 at 05:45 | #41

    @Jordan was there a reason for the stae owning utilities

  42. Jordan
    November 16th, 2012 at 07:10 | #42

    @Jim Rose
    Yes. They didn’t have that or this utility so they joined forces to build it because private “entrepenuers” did not have resources or they saw no profit in it.
    Can you imagine building power line 20 miles for 20 houses. Only state would do that for the benefit of those 20 homes. Private utilities would demand those 20 houses to pay for all of it.
    Only state could do it.

  43. Jordan
    November 16th, 2012 at 07:12 | #43

    so i guess you do not have an answer on why to privatize it.

  44. JB Cairns
    November 16th, 2012 at 07:58 | #44

    Jim,

    I would have thought it was a duty of a person such as yourself to explain to the innumerates on Catallaxy the methodology behind Silver, Wang and even our own Simon Jackman and why they were all getting the same results.

    Why were you silent? Was this another Lindzen moment for you?

  45. Dan
    November 16th, 2012 at 09:02 | #45

    @Fran Barlow

    Hear hear!

  46. MG42
    November 16th, 2012 at 09:57 | #46

    Jim Rose :
    @Jordan was there a reason for the stae owning utilities

    In a very large nutshell, since early days of Australian settlement there was some distrust about unfettered capitalism and having a large number of government businesses and a large scale of government involvement in the economy was accepted as a way to maximise social goals, Australia at the time being highly populist, egalitarian and unionised. TAA was just the latest in a line of GBE’s which only started being dismantled in the 80′s.

  47. may
    November 16th, 2012 at 11:52 | #47

    more reality.
    where will it end?

    http://www.saveourmarinelife.org.au/proclamation

    crossed fingers.

  48. may
    November 16th, 2012 at 11:53 | #48

    jeez it worked again.

  49. Jim Birch
    November 16th, 2012 at 12:02 | #49

    @Jim Rose
    That’s a fairly weak point. There was two airline policy. AFAIK it was supposed to supply a level of competition while maintaining continuity, safety and quality of air service to a small dispersed population. Those were the days when governments were actually expected to make reality-based decisions that benefited the community rather than satisfy anyone’s rights of access to markets or enact particular world views, so you might consider forgiving them their ideological incompetence. (Those were the days!)

    You might note that at that time there was an even more limited market for air travel in Australia than there is now and there weren’t lines of entrepreneurs proffering alternate comprehensive services. (The airlines were expected to cross-subsidise their less profitable routes.) You might also note that despite deregulation, we remain very close to the two airline policy outcome so it’s likely the policy rationale was reasonably realistic.

  50. Mel
    November 16th, 2012 at 14:09 | #50

    Now Rosey, how about telling us a little more about Romney’s plan to save the US.

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