John Quiggin

“Not Keen on Harsanyi”.

Prof. Steve Keen and economics in general are having problems at the University of Western Sydney.

It’s interesting how things never change…
http://aussiemagpie.blogspot.com.au/2012/11/not-keen-on-harsanyi.html

Has anybody noticed that Christmas advertising seems subdued this year? That’s OK by me as I find it moronic. We are urged to consume frivolous trinkets, buy gifts for people we otherwise ignore and engorge ourselves with the burnt flesh of hapless animals. All done to tinkling sounds and the glitter of Christmas tree lights, now carbon taxed of course. Then there’s dreaming of a white Christmas except it’s 35C. A visitor from another galaxy might conclude we are not the full quid.

I think some TV networks would do well to avoid the cloying Kris Kringle movies. Show enth repeats of anything that is halfway interesting.

This afternoon (21 November) Security Council members will meet in consultations at 3 p.m. to discuss a draft press statement on the ceasefire agreement between Hamas and Israel which was announced today by Egyptian President Mohamed Morsi. It seems the Secretary-General, who is in Tel Aviv, will brief the Council on the Gaza situation and subsequent ceasefire agreement at 3.30 p.m. via VTC.

It seems the draft press statement, circulated by the US earlier today, welcomes the ceasefire agreement, calls on the parties to uphold it, expresses support for ongoing efforts by the international community to consolidate the ceasefire and commends the role played by Morsi and the Secretary-General in reaching the agreement. The draft press statement also apparently deplores the loss of civilian lives and urges restoration of calm in full. There also seem to be references to the need for emergency aid for Gaza and quick delivery of such humanitarian assistance.

Earlier today, prior to the announcement of the ceasefire, Council members were preparing to hold a debate, requested by the Arab Group, on the Gaza situation this afternoon. However, at press time it seemed the debate had been called off. (Council members met briefly on the Gaza situation yesterday at 3 pm to discuss the possibility of holding a debate but adjourned until 6 pm anticipating the ceasefire announcement.)

Also, earlier today, Russia had called for a vote on a revised draft resolution (S/2012/855) which it had put in blue on 19 November. However, the vote on the Russian draft resolution has also been put on hold following the ceasefire announcement. The draft resolution expresses concern at the deteriorating situation and escalation of violence in Gaza and southern Israel. It also expresses support for the current mediation efforts and demands a cessation of violence and encourages the resumption of Israeli-Palestinian bilateral negotiations on the basis of the two-state solution as envisaged in resolution 1850 (2008). In addition the draft focuses on humanitarian issues and the need for humanitarian access in Gaza.

While Council members are aware of the need to quickly respond to this positive development, it is unclear whether possible additions to the draft will delay agreement. It seems some members, in particular Morocco on behalf of the Arab Group, may see value in incorporating some of the elements of the draft resolution into the draft press statement, such as references to the peace process. There may also be interest from other members in incorporating the more specific references to humanitarian issues and humanitarian access.

This was an interesting summary from “What’sInBlue.Org”.

Morocco put up a “Draft Press Statement” last Thursday calling for peace in Israel/Gaza. This is the weakest form of UN action but even that was vetoed by the US.

Now, a week later, there has been no UN security council action thanks to the US and the ceasefire just announced appears to be timed to suit US/Israel and to avoid the possibility of an “Open Debate” and/or the Russian statement.

Payroll Tax: has anyone looked at or know of any studies that assess removing payroll taxes in Australia?

My initial thought would be that a tax revenue neutral strategy that replaced payroll taxes with an increase in the company tax rate would be far more efficient overall. Currently firms get overly generous deductions for capital depreciation along with dedcutions for interest on borrowings while labour is taxed twice (payroll and income taxes). Surely it would be more efficient to place labour costs on a more equal footing to capital inputs.

@TT

Labour gets taxed thrice – payroll – PAYE – then GST when they spend wages.

Cutting payroll tax is a common cry. However the tax base needs to be as broad as possible.

Payroll tax is a state-based tax, while company tax is a federal tax. States who are responsible for schools, hospitals, police, etc would not be willing to see their tax base wither nor be beholden to any future austerity driven federal regime.

Payroll tax, handled equitably, supports local services and assists decentralisation.

Why fiddle with payroll tax if the problem is weak taxation of company super-profits?

If the federal boffins can tax mining super-profits why not bank and energy providers super-profits?

Just saw a great film about ‘Zionism’. Strongly recommend it to anyone with a brain and an interest in the world generally and the middle-east specifically.

Here’s what the film-maker says about it:

“I have recently finished an independent documentary, The Zionist Story, in which I aim to present not just the history of the Israeli/Palestinian conflict, but also the core reason for it: the Zionist ideology, its goals (past and present) and its firm grip not only on Israeli society, but also, increasingly, on the perception of Middle East issues in Western democracies.

These concepts have already been demonstrated in the excellent ‘Occupation 101′ documentary made by Abdallah Omeish and Sufyan Omeish, but in my documentary I approach the subject from the perspective of an Israeli, ex-reserve soldier and someone who has spent his entire life in the shadow of Zionism.

I hope you can find a moment to watch The Zionist Story and, if you like it, please feel free to share it with others. (As both the documentary and the archived footage used are for educational purposes only, the film can be freely distributed).

I have made this documentary entirely by myself, with virtually no budget, although doing my best to achieve high professional standard, and I hope that this ‘home-spun’ production will be of interest to viewers.” – Ronen Berelovich.

You can see it by reconstructing this link:

http : // www . informationclearinghouse . info/article33128 . htm

Professor Keen, on capital account (via Minsky) has identified 1966 as the year that the US reached a level of fragility. Where the debt to GDP ratio had gotten too high. And when loanable funds were being allocated to non-productive uses. This sort of sounds about right to me. Some of us usually date the problem to 1971 when the last link to gold was cut. But 66 ties in pretty well with the Johnson guns and butter policy.

Things have gone so bad now that we will stagnate, and the Americans will collapse unless radical steps are taken. To go back to Sado-Monetarism without some sort of partial Jubilee would be akin to some sort of vicious chemotherapy. I favor partial jubilee then tough money as well as 100% backing. But if we cannot do that we have to take control of the bankers. I mean we HAVE to. There isn’t a way out. Unless we stop them lending for consumer finance, and asset inflation, and force them to lend to improve operations, we are in big big trouble. Certainly the Americans are yesterdays news. Most people don’t understand the terminal nature of the problem.

@John Quiggin
Excellent news! I abhor this slide from economics to commerce as if commerce is economics.

A curious twist to the EMH

A new research paper by David McLean and Jeffrey Pontiff explicitly examines the idea that academic research into anomalies is a self-denying endeavour. They find some evidence of spurious patterns: if a given dataset suggests an anomaly, including subsequent data tends to erode it. But what is really striking is that after an anomaly has been published, it quickly shrinks – although it does not disappear.

The anomalies are most likely to persist when they apply to small, illiquid markets – as one might expect, because there it is harder to profit from the anomaly.

The efficient markets hypothesis is surely false. What is striking is that it is very close to being true. For the Warren Buffetts of the world, “almost true” is not true at all. For the rest of us, beating the market remains an elusive dream.

http://timharford.com/2012/11/still-think-you-can-beat-the-market/