I closed the last sandpit because it had collapsed into a string of personal attacks – if I get time I’ll go through and delete them. I’m opening a new one, but restating the need for civil discussion, which includes a requirement for no personal attacks on other posters. I’m going to be enforcing this more stringently from now on.
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John Quiggin 
I gather that the Syrian opposition forces are funded by some of the other states in the Middle East except for Iran. The media never ask why?
• Why would Turkey want war and anarchy next door?
• Why would the Middle-east and Gulf autocrats want the Arab spring to last longer? They could be next?
I recommend the CPAC coverage from Daily Kos blogger Hunter: http://www.dailykos.com/news/cpac%202013
The crux:
Well, I wonder who has been and who is currently selling both the Syrian government and the Syrian opposition weapons. It never cease to amaze me that these desperately poor countries (for the most part) in MENA (Middle East and North Africa) are nevertheless awash with weapons and war materiel. Where is it coming from, who is paying for it and who is peddling it?
Anyone know some verifiable facts on this? This report might be a good place to start.
Click to access act301172011en.pdf
It seems Europe (including UK and Russia) and the USA are the main culprits. This is a clear example (even clearer than the tobacco industry) that profits depend, in many cases, on inflicting systematic death in other corners of the globe.
This is the best description of MMT yet and consequences of it in the present world. Comments bellow are as good as they come, too.
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MMT is a shallow rationalisation. Its core thesis:
is false under capitalism.
Under capitalism, with everything else staying the same, prices must always rise faster than wages. This is the only way the same rate of profit can be maintained as capital accumulates.
Things are more complex in reality because workers share can fall, capital can concentrate and markets can expand due to population growth, but in principle, prices must rise faster than wages because final consumption revenues must rise further than costs because capitalists demand a constant rate of return on their ever increasing accumulating Capital.
End of story.
There you go again, assiming that capital yields no surplus over deprectaion! We have been through this before with the lawnmower eample; are you seriously siggesting that the added productivity of using a lawnmower over clipeers exactly equals the depreciation on the lawn mower. Three more points:
a) if capital had zero productivity then the optimal capital stock would be zero.
b) if the profit maximising markup was k% before invesment in unproductive capital, it would not go up to more that k% after the investment in said capital (ie Marx’s transformation problem has no solution)
and (c) real wages have increased dramatically since Marx’s time.
I have come across two comments by Professor Aynsley Kellow, my old colleague and well-known climate contrarian, on a blog thread published immediately prior to the 2012 US Presidential election. Due to recent policy changes at this blog, I cannot name the blog at which Aynsley Kellow’s comments were posted. However, the comments were sceptical of poll predictions that Obama would will the election, and specifically criticised Nate Silver, stating that Silver’s predictive methods suffered from the same problems as climate models that predict global warming. It is not known whether Professor Kellow revised his views on this point after the election.
@Paul Norton
Probably not. He’ll be insisting that the Tea Party elect a new people …
@Paul Norton
That’s not my interpretation of the rules. As stated in “Peace Breaks Out …”
Assuming, purely for the sake of argument, that the unnamed blog were Catallaxy, nothing you’ve said above meets either of these tests IMO, although I suppose calling him an “old colleague” or “well known climate contrarian” might be personal references. You might simply have said “Professor Aynsley Kellow, over at Catallaxy, asserts as follows: {…}” and you’d surely have passed muster.
@Paul Norton the prediction markets got 50 states out of 50 right in 2012.
As Steven Pinker demonstrates, we’ve never known so much peace. Hitherto, from the primitive communism of the hunter-gatherer to the early years of the industrial revolution, life has been brutal and short. But now, we in the bosom of secular democratic capitalism are many times more likely to die from boredom or gluttony than from villainy or want.
This from a Guardian review of Pinker’s scholarship on historical levels of violence:
“So what has made human beings less violent? Pinker organises his history through six trends. First is the “pacification process”: the shift from hunting and gathering to the first agricultural civilisations, bringing a fivefold decrease in violent death. Next is the “civilising process”, starting in the late middle ages. Then comes the “humanitarian revolution” of the 15th to 18th centuries, gradually reducing despotism, judicial torture and duelling. Finally there’s the “long peace” following the second world war and the “new peace” after the fall of communism: both periods are notable for their championing of human rights and a growing disapproval of everyday aggression. We’re hardly angels yet but we have become a far less brutally cruel and more peace-loving species.”
Is it any wonder that the working class in the advanced capitalist nations loves capitalism as a mother loves her newborn babe but hates the communists with a passion worthy of the devil.
Herewith endeth the Sermon. Peace be upon ye.
And yet centrally planned societies, like those of Scandinavia and Singapore, enjoy greater and wider levels of comfort and achievement than do those that attempt to represent capitalism eg USA
Mel, “Is it any wonder that the working class in the advanced capitalist nations loves capitalism as a mother loves her newborn babe but hates the communists with a passion worthy of the devil.”
What is a wonder, I think is how you know this.
What ‘working class’ do you hang out with Mel? The rural agrarians out in the regional areas that I talk to are not all that anti socialism at all. Many of the dairy farmers, in particular,
have had to become ‘workers’ in town and quite clearly and very emphatically, they hate capitalism, as represented by the coles woolies duopoly and they seem to be realising that it is the profit at all costs attitude and the requirement to compete without compassion, that capitalism has forced on us and our children, our society and our government, that is the real problem.
@Julie Thomas
Ignore mel, it is just trolling and deliberately injecting psywar concepts such as “hate”. This is not normal behaviour.
In fact only mel is ‘hate’.
As during Enclosures and Dickensesque industrialisation, and as in the receiving end of colonial slavery, people have learned to truly hate capitalism like no other, even more so as they watch their children in the Third World forced out of school to spend their days scavenging on huge piles of urban waste looking for recyclables.
As they loose their jobs, their houses and cash, as they see the climate destroyed purely by capitalist demands for fossil fuel, more people will learn to ‘hate’ capitalism.
Maybe we all need to learn to ‘hate’ mel.
Chris I managed to ignore the ‘nasty, brutal and short’ silliness but it really is interesting how openly how people in my small community – old tree changers of various ‘classes’, are pooling their experiences and finding that the real ’cause’ is neo-liberal capitalism. There are people who worked hard all their lives to be self-supporting, became mum and dad investors and then lost so much of that wealth are meeting up at the craft co-op where I work – amazing how many people out here are ‘into’ that word ‘co-op’ these days – with the dairy farmers and others of us who think that a co-operative community is the best way to survive the slow collapse and re-organisation that is happening, and working out what has happened to our values and our character over the past decades.
Mel gets very bad back pain I think and can’t get proper pain relief so he gets cranky but he’s not ‘that’ bad, for an old fart. I think he has redeeming features but then I think almost everyone has 🙂
oops a bit incoherent but I’m on my way to work sorry
Ikonoclast,
Yes, in principle I agree with the EU bailout conditions for Cyprus. Given the information available to me, the EU is prepared to provide about Euro 10 billion on the condition that the beneficiaries of the Cyprus financial sector (banks and their clients) make a contribution of about Euro 5.8 billion in the form of a once only levy on deposits.
The initial proposal was to levy a little less than 10% on accounts above Euro 100,000 and a little more than 6% but less than 7% on accounts less than Euro 100,000.
By last week-end the Sueddeutsche Zeitung (major German newspaper not classified as a sensationalist tabloid) reported that it was the EU finance official, Schulz, (not the Cyprus government) who proposed to exclude “small” deposits. I have no information on whether or not the EU wants 10% instead of a little less than 10% on very big deposits. (I suspect they would want that).
In the meantime it transpired from the local (Sydney) press that Russian oligarchs and the Russian state has deposits in Cyprus banks (confirmed in the Sueddeutsche Monday local time edition) and ex-comrad Putin is not pleased. One figure banded around is the Russians could ‘lose’ about Euro 2 billion if the levy is imposed (with deposits up to Euro 20000 being levy free).
Isn’t it obvious that the Russians wouldn’t ‘lose’ anything if they had used their apparently Euro20 billion for productive investment (or social services) in Russia instead of getting high (higher than in Germany) interest in Euros??
Today I read a Cyprus official has flown to Moscow to get more loans. Well, well, this is where ‘political economy’ starts. Consider the location of Cyprus, NATO, the EU and Cyprus’ history.
Do Cyprus people and their politicians really believe they can have the ECB underwrite loans from Moscow??
I don’t believe it is fair to simultaneously treat people as equal but not when they are in a lender-borrower relationship. There is a distinction in my mind between helping out borrowers when they have struck bad luck and the apparent demand that it is the lenders’ fault when the borrower goes bust. I’d accept the latter only for juveniles.
Nothing in my foregoing paragraph contradicts anything I’ve ever said or written regarding the proverbial Wall Street bankers.
The various attacks on the ECB play into the hands of the proverbial Wall Street bankers.
The notion of austerity in many EURO countries is not the same as that contained in an article by a US economist that was taken to shreds by our host. The term austerity in many EURO countries (eg Germany, Netherlands, Denmark, France, Italy excluding bunga bunga), Austria is more akin to the behaviour of Australian borrowers as of the onset of the GFC, namely to try to live a bit more economical and pay off debt faster.
The MMT idea that a sovereign country can issue its own money is neither new nor interesting. As is apparent from the behaviour of the Cyprus official going to Moscow, he or she has no confidence in a hypothetical own currency – they want a line of credit from a big brother first.
The Cyprus government (with the support of its population) is playing a geo-political game. The international financial markets aren’t fooled by it nor the EU governments; only some journos (and possibly some MMT supporters) are.
@Julie Thomas
Co-operatives are part of the solution. They need to be promoted strongly – they can be a structural mechanism for differentiating between normal profits and capitalism while also enhancing local economic democracy.
@Ernestine Gross
That’s an interesting and very orthodox construction (IMO). We are going to have to agree in parts and disagree in parts.
First on Cyprus;
1. Cyprus like most modern mini-nations (Singapore is an exception) is not viable under any system. It will always need propping up. Mini-nations suffer from dis-economies of small scale. What natural resources and natural advantages does Cyprus have? Very few I can guess without even checking. Is the landscape already exhausted soil-wise, vegetation-wise etc. from millenia of human and domestic animal oppcupation? Again, my safe guess is yes without even checking. Also, I suspect the local Mediterranean waters are largely fished out.
2. Cyprus opted to become a tax haven. This is the route often taken now by small island nations with relatively little else going for them. Tax haven status is a form of quasi-legal, quasi-crooked financial chicanery. This strategy works while the world financial bubble keeps growing. As soon as the bubble starts collapsing, places that put all their eggs into the shonky end of the financial sector basket collapse with it.
3. Local Cypriots now have two choices apart from emigration. These are to live on their own meagre recources or live on transfers. Being a tax haven engineered transfers of monies, capital and income to Cyprus. These are still transfers. The other ways to live on transfers are to recieve aid or amalgamate with a larger, more prosperous nation state and receive vertical fiscal transfers from that state’s federal government.
4. The choices are to be independent, proud and poor or to join a larger, viable nation, accept a form of federated statehood and accept transfer payments. In return, Cyprus no doubt has strategic value from its location. That is its bargaining chip.
Second, on the ECU;
5. Supporting ECU policy is tantamount to supporting an already obvious loser. Cyprus, Greece, Spain, Potugal, Ireland and perhaps soon Italy are already in a Great Depression. This is the result of the austerity policies and single currency zone of the ECU. This is the result of creating the opposite of an “Optimal Currency Area” i.e. a “Dysfunctional Currency Area” (dysfunctional for political, ideological and demographic inequality reasons).
6. MMT theorists like Bill Mitchell have been consistently predicting the EU will plunge further into trouble under current policies. They also offer explanations which appear logically consistent with the facts. The MMT theorists have been consistently proved correct. So far, the empirical facts support MMT on this matter. I will go with the empirical facts until something dramatic happens to dis-prove the MMT theory (in the Popperian sense).
@Mel
I think the word you’re looking for is “opines”. Steven Pinker ain’t “demonstrated” nuthin’.
Tim M,
Pinker marshals an impressive body of evidence to support his argument. I haven’t seen anyone land a killer blow on his argument but if you have any links to well argued counter-arguments I’d like to see them.
http://www.zcommunications.org/reality-denial-steven-pinkers-apologetics-for-western-imperial-volence-by-edward-s-herman-and-david-peterson-1
I see some people above have tried to get something going on MMT and in response some Austrian has replied.
If we’re not very careful we will soon move on to fiat versus commodity money, and fiat money is like Israel/Palestine in the blogosphere – for some reason quite impossible to have a civilised discussion about. In fact the Blog Which Must Not Be Named once had a famous thread of doom on it. John may be kept very busy enforcing his new rules if it goes there.
@Ikonoclast , its hardly just MMT people who predicted the Euro problems – economists ranging from the far right (Mundell, Feldstein) all the way to the far left (Bill Mitchell, sundry Marxists) did so. I don’t think you can claim vindication explicitly for MMT people here – they’re hardly the only ones familiar with the term “optimal currency area”.
At the risk of igniting the war I feared in my earlier comment the Euro looks rather similar to the sort of problems the Gold Standard was prone to, and for similar reasons ….
Chris Warren at #6
MMT policies have a redistributive effect by employing unwmployed and proposes as everyone sle on how to invest in the future.
That redistributive effect has inflationary effect on the wealth and debt of non wealthy. It is a counter to normal distribution upward you have described.
Just as 1930-1970 period was capitalist, it was very succesfull due to high marginal tax and rising inflation which have strong enough redistributive effect to counter distribution upward of capitalist order. Unions held those redistributive policy alive and well.
But as we can see, organized capitalist had more perseverance and capital to winn against those redistributive policies that kept capitalism in check. Since that outcome will repeat again if the world ever returns to Keynesian policies i prefer change to more cooperative system that does not have such distributive effect upward in its core.
MMT is just Keynes without gold standard effects that allow for new and more exotic policies.
on “its hardly just MMT people who predicted the Euro problems” , Milton Friedman predicted that the euro would not survive its first major recession saying that “it’s hard to believe that it’s going to be a stable system for a long time” and “It’s only a year old. Give it time to develop its troubles” and ” It would exacerbate political tensions by converting divergent shocks that could have been readily accommodated by exchange rate changes into divisive political issues”
HT: http://www.project-syndicate.org/commentary/the-euro–monetary-unity-to-political-disunity#eAckTegoHOyBEsWT.99
thanks Nick, weighing in at 55 pages on my word processor that looks like a seriously substantial review by someone i respect. looking forward to reading it. -a.v.@Nick
@Mel I would think the continued success of People’s Republic of China woud be sufficient.
@Tim Peterson
As I said previously…
It takes a bit of thought to step through this issue.
Anyone using a lawn mover in the same market as everyone else uses shears will gain a competitive advantage. Capital obtains this so-called “return” in the short-term. But this is competed away and this return is a transfer from the market share of others.
Capital has obvious productivity – it increases the product per hour of workers. But still, assuming a free market, this is only the normal wage at equilibrium.
To be specific – assuming:
– hand cut grass is the same as machine cut grass.
– That anyone can sell cut grass services using a machine,
– that numerous grass cutters switch to machines, and
– everyone knows the prices being sought/offered for grass cutting.
A rational lawn mower worker will continue to supply lawn mowing provided they cover a wage and depreciation. If they demand anything more, they will tend to supply less, and at higher prices. This forces the market to operate inefficiently because, if the demand for grass cutting is downward sloping, there is a preferable, greater consumption quantity at lower prices.
It is possible to complicate this story, for example if a worker borrows a machine and pays rent. But then this confused Steve Keen no end, so I wait to see whether Keen confusion is really behind your concerns.
@derrida derider
Difference in MMT and others who described problems of eurozone as “optimal currency area” is in description of the mechanisms of predicted problems.
Can you find any present country as “optimal currency area”. Is Australia an “optimal currency area”? Any country has permanent defficit and surplus areas so that is not an optimal currency area. Every city has permanent surplus and deficit areas. Every subdivision has permanent deficit and surplus areas, even families have permanent deficit and surplus areas.
What you described as “optimal currency area” is just an area that has transfer mechanism to acomodate for out of ballance payment without tribal antagonisms.
Any less developed state in Australia is in permanent defficit but as a part of a federal system has transfer mechanisms that enbles permanent circulation.
Federal transfer mechanisms for “optimal currency area” are united health and retirement system, intentional higher military production investments into deficit areas, Purposefull federal investments, and so on.
This transfer mechanisms into permanent deficit areas has the same affect and relation as redistribution effect i described in the earlier post. Lack of transfer mechanism toward permanent deficit areas in eurozone which is existing in any federal system is what MMT describes as the problem. Not the fact that there are permanent deficit and surplus areas as others “predicted”. MMT says that permanent deficit and surplus areas is a normal state of any currency areas and gives solutions, while others say that existance of permanent deficit and surplus is the problem and it should somehow be removed, which is acctually impossible in any single currency area.
Permanent imbalance in any single currency area is reality, whether between members of the familly, between areas in towns, between cities, regions, states in a federation, countries within eurozone or currencies tied by gold standard or euro standard (pegged to the euro or dollar) or between wealthy and poor. There is a natural tendency for distribution upward.
This is the fact and extremely rarely can be changed but it can be amelieted by transfer mechanisms.
MMT describes movement of money within a currency area while classical economists prefer to deal only in real values and talk about money, debt and banks is heresy.
This circulation of money between permanent surplus and deficit factors helped by transfer mechanisms i like to call Nominal Surplus Circulation.
@Mel
Mel, I don’t even necessarily disagree with Pinker, in fact I think his thesis has some plausibility, but to claim he has “demonstrated” his thesis, is far too strong a statement. He does marshal a lot of information to support his arguments but, like all, essentially sociological theories of this kind, most of his argument is based on interpretations of historical and archeological material. He’s not exactly dropping cannonballs from the leaning tower of Pisa. Because they have a relatively low level of certainty compared with, say, physical experiments, interpretations of this kind, however persuasive, can never be proven in anything like a conclusive way, and are always open to challenge.
Because of that, I don’t think anybody needs to have landed a “killer blow” (whatever that means) to refute the notion that Pinker has demonstrated the thesis (as opposed to having simply put forward a plausible hypothesis). All that’s required is to cast doubt and offer counter-interpretations of the historical data. It’s actually debatable whether it’s even possible at all to “demonstrate” the truth of a broad sociological thesis about the overall history of humanity.
Interesting new news about Vietnam war
@Tim Macknay
I actually disagree with much of what Pinker says and I think he underestimates the deaths from various recent conflicts but I do accept the broad brush claim about the violent nature of hunter-gatherer and horticultural and feudal societies cf. the present.
To some extent, my original post on this thread was a reaction to the crude and hyperventilating criticisms of capitalism as it manifests itself in the West that we see on this blog.
@Nick
The authors of the piece you link to include Edward Herman, who was of course a notorious apologist for Pol Pot’s Khmer Rouge. As you are undoubtedly aware, he claimed the first hand accounts victims who survived the Khmer Rouge were unreliable.
More recently, Herman has rewritten the history of Rwandan genocide and the wars in the former Yugoslavia and in this latest article, Herman and friend claims the US is currently encircling and threatening China among a laundry list of other misdeeds.
George Monbiot on Herman and co.
@Mel In crude retreat you fail to mention that Pinker has been soundly refuted by the evidence and you fail to demonstrate how criticisms of capitalism, irrespective of their validity, are “crude and hyperventilating”.
as herman & peterson advance a critique along the historical & political front, douglas p. fry is an anthropologist who disagrees with piker’s claim:-
http://www.bookforum.com/inprint/018_04/8575
a.v.
@Nick
The authors of the piece you link to include Edward Herman, who was of course a notorious apologist for P0l Pot’s Khmer Rouge. As you are undoubtedly aware, he claimed the first hand accounts of victims who survived the Khmer Rouge were unreliable.
encircling and threatening China among a laundry list of other misdeeds and that the Khmer Rouge was in many ways just what progressives had been hoping for.
George Monbiot on Herman and Peterson’s fabrication of history:
” I consulted four of the world’s leading genocide scholars: Martin Shaw, Adam Jones, Linda Melvern and Marko Attila Hoare. I asked them each to write a brief response to the claims the two men made on Znet. Their statements, which I have also posted on my website, are devastating(8,9,10,11). They accuse Herman and Peterson of obfuscating, distorting and misrepresenting the evidence, and of engaging in genocide denial.”
Sorry. Misedit of #38. Should read:
The authors of the piece you link to include Edward Herman, who was of course a notorious apologist for P0l Pot’s Khmer Rouge. As you are undoubtedly aware, he claimed the first hand accounts of victims who survived the Khmer Rouge were unreliable and that the Khmer Rouge was in many ways just what progressives had been hoping for.
Pinker claims “we may be living in the most peaceful era in our species’ existence.” So in this peaceful era (!?) we witness this:
http://www.iraqbodycount.org/ (an under estimate)
and Yankee drones raining death amongst the villages of faraway lands echoing possible chemical war in Syria.
As wars rage all around us today, it is entirely expected that a Monkton would step up to exploit the situation. However Pinker (Monkton Mk II) is easily dispensed with as Nick provided above [ie Herman & Peterson]. It would appear that capitalism has waged almost continuous war against many others, from the smallest of nations, Guatemala and Grenada, to decades of region-wide bombing campaigns in the Middle East. If you follow the violence from only the United States, you see after WWII almost perpetual war, whether in Korea, Vietnam, Chile, Afghanistan, the Middle East or Bosnia. In such circumstances America needs a Monkton or a Windschuttle.
Herman & Peterson find that Pinker makes extremely silly assertions – reflects gross political bias – displays staggering naiveté – presents overwhelmingly ideological work, with biases that reveal themselves at every level and on all topics – presents rhetoric saturated with political bias, straw persons, and literal errors – a blatant display of internalized Cold War ideology – Orwellian inversion of real history – a remarkable inversion of reality – Panglossian nonsense grounded in ideological thinking – dodging of the facts – a stream of pro-war apologetics – pure assertion – the uncritical acceptance of official and implausible claims – a refusal to report inconvenient evidence – selecting his sources on the basis of their congenial findings – accepting methodologies that are often laughable – engages in multi-leveled deception – ignores state terrorism – follows a party-line invidiously – seriously misrepresents past and current events – suppresses facts that conflict with his beliefs – echos the work of other researchers closely aligned with a decades-old U.S. and Western agenda – parrots the State Department’s designation of who engages in “terrorism,” – writes beyond the preferential method of research – a classic of misrepresentation – takes the Western media’s headlines and choruses of moral outrage as unbiased unlike serious analysts or scholars – is underpinned by racism – gross misrepresentations of history – conspicuously displays racist biases – establishment ideology – rewrites history to accommodate establishment perspective – averts his eyes from inconvenient facts – contains outlandish moments – is extreme fanaticism masquerading as scholarship – contains definitional sleights-of-hand – disingenuous arguments – suppresses inconvenient examples – presents figures that fail to teach the lessons that Pinker claims they do – uses bravado to disguise lack of substance – deals with data with a cavalier attitude – uses cherry-picked data – presents a “trite Hobbesian message” – fails spectacularly – inflates death tolls from the past and minimises those in the modern period – massages numbers – plots data on logarithmic scale to reduce the apparent scale of recent atrocities – makes remarkably deceptive claims – implores readers to ignore major pieces of evidence – and whose scholarly apparatus is but a misleading façade.
Herman & Peterson conclude –
http://www.thirdworldtraveler.com/Blum/US_Interventions_WBlumZ.html
@Ikonoclast
Cyprus. There are a few empirical details you might wish to consider.
a) Since posting last on this topic, I learned from the EU(Euro) press that the offer from the EU(Euro) countries is even more generous than what I knew at the time of my first post. In exchange for the once only levy on Cyrpian bank deposits (as detailed before), the depositors are offered shares in the banks. In Finance one calls this a debt/equity swap.
b) Cyprus has a small population (size of Adelaide), highly educated, with a mean income of about US$28,000 p.c.
c) Its history is long and bloody. Throughout the mid-20th century there was acute conflict between the Turkish minority and the Greek majority. The disagreement among the Cypriots are bigger than those within EU countries on many issues, including on international treaties (eg with Israel).
d) Cyprus has extensive natural resoures: Its climate (hence tourism and gastronomy – expats from the North of the EU), fishing and, natural gas reserves. There is also agriculture and trade.
e) Cyprus has a long history in geo-politics. It has now income from several UK military posts.
f) Cyprus joined the EU only in 2004 and adopted the EURO in January 2008. I’d like to note that by January 2008 there was ample evidence the international financial system is on the brink (look up JQ’s post from mid August 2007), even though the extent of the disaster wasn’t known even among people knowledgeable in this area.
g) Interviews of financial consultants from Cyrpus, reported in the Sueddeutsche Zeitung, revealed the Cypriot banks hold extensive deposits from Russian abnd Greek ‘investors’ and these banks lent to Greece. (I’d like to recall there is a recognised tax collection problem in Greece – surely this will enduce a few thoughts on was going on there.)
h) As for other countries, there are extensive transfer (development) programs within the EU and the EURO countries in particular. However, these programs are not outsourced to tax minimisers and other get rich fast merchants (some, I suppose, could be called ‘oligarchs’, but I leave the name calling to others).
It seems to me ‘theoreticians’ and their followers who argue against ‘capitalism’ (without ever specifying what it means) and against the EU project as well as the EURO are not familiar with the methodology of checking for the logical consistency of their theories.
The EU project rests not only on what governments do but also on the populations everywhere learning about a social-ecological-market economy – which I call a contemproary version of social-democracy. There is no room for a tax haven for obvious reasons.
The post by Jordan regarding wealth distribution and transfer within geo-politically defined countries is, IMO, valid and apt.
I leave it to you to work out whose interests the Cyprian parliament represented.
Mundell, the originator of the notion of ‘optimal currency area’, did not show up at the 2011 Lindau meeting of economists.
A reference to an ‘optimal currency area’ would presuppose a reworking of the idea within the context of a ‘global economy’ that is linked by multinational corporations and financial institutions. The contemporary international institutional environment is very different from that at the time when Mundell wrote on this topic.
I am puzzled to note that the origin of the GFC has already been forgotten. Spain and Ireland (but not Greece) problems were made in the board rooms of the proverbial Wall Street banks and their friends, the rating agencies, and not in Brussel. Greece’s problems were made in the offices of creative accountants – overseen by governments. My information on Portugal is very limited (they had problems with the EU specified sizes of oranges – but this cannot be all of it). So, the stereotypical arguments (naive macro-economics) regarding the EU may apply in some offices in Newcastle but are difficult to identify anywhere else.
If this were so, there would be no tendancy for prices to grow faster than wages!!!
Capital is costly; producers need to make enough to cover their interest payments/return on equity. This isn’t to say that the rate of return on capital is written in stone. Neocassical growth theories explains how the rate of return on capital will fall as the capital stock deepens (ie more capital per worker) until it stabilizes a lower level as the economy converges to steady state growth. Again, there is no tendancy in this deterministic model for prices to rise more than wages (although you could introduce shocks that had this effect temporarily).
Mel, I’m not all that interested in what Monbiot has to say, and neither should you be. He dismisses the authors as “genocide denialists” because they cite evidence of lower figures for Tutsis slaughtered, and higher figures for Hutus slaughtered, than he or the experts who agree with him are prepared to accept.
Monbiot reports 800,000 Tutsi deaths. Herman and Davidson assert that, based on Rwandan census figures from 1991, it could only have been 300-000-500,000. Their argument is straightforward – either the census figures were out by several hundred thousand, or the claims of 800,000 Tutsi deaths are out by several hundred thousand. I fail to see why raising this should invite accusations of “genocide denial”.
The figures they cite for Hutu deaths – which sent Monbiot into paroxysms of indignation and outrage – also clearly include those in the Congo in the immediate aftermath of the Rwandan Genocide, where, according to Amnesty International figures, in 3 months alone, the US-backed invading Rwandan Defence Forces rounded up and slaughtered some 200,000 Hutu refugees.
In 2004, Monbiot, doing a pretty good impression of a Bush Doctrinist, would seek to justify this mass-slaughter of refugees:
http://www.monbiot.com/2004/12/14/a-deadly-reversal/
“Rwanda has already invaded the DRC (or Zaire, as it used to be called), twice. In both cases it appeared to have justification. The Interahamwe militias who had killed 800,000 Rwandans fled there after the genocide in 1994. They were sheltered first by President Mobutu, then by President Kabila. They wanted to reinvade Rwanda and resume the genocide.”
However, he concedes in the same article:
“But after moving into the eastern DRC for the second time, in 1998, Rwanda more or less forgot about the genocidaires. It had found something more interesting: minerals.”
Which begs more questions than Monbiot is prepared to answer. He is willing to hold the Rwandan Defence Forces accountable for 3.8 million deaths in the Congo – but derides as “loony” anyone who might dare to question what took place just a few short years earlier in Rwanda.
@Tim Peterson
Yes – Hallelujah – you got it kiddo!
The rest of your post was capitalist theory. Capitalists need to to cover their interest payments/return on equity and these deductions are corrupted by capitalism.
All this is rather complex, but there is a difference between market socialist “interest” and capitalist “interest”. An additional return on capital, at equilibrium in a free market, is impossible – it will always be competed away.
@Nick
I’m not that interested in what Monbiot says either, but I am interested in what the professional researchers who publish in the peer reviewed literature have to say. Monbiot contacted four of them (see my quote), none of whom are right wingers, and each of them provided compelling arguments for why we should regard Herman, Peterson et al as cranks.
Call me old fashioned if you will, but unless there is a compelling reason to do otherwise, I give extra weight to the opinions and arguments of experienced peer reviewed researchers in less weight to the opinions of amateur keyboard sleuths and cause-pushers like Herman.
If you wish to believe Herman and Peterson, fine, that is your right, but I see no point in engaging with you further if you don’t at least read the arguments that peer reviewed scholars on genocide, such as Jones, Caplan, Hoare, Shaw and Malvern use to dismiss them as serial fraudsters.
Oops- Melvern is only a journo. My bad.
As we all know, if Mel pushes a barrow, it quickly falls apart.
It appears that Monbiot’s exercise was itself a camouflage, and Marko Attila Hoare is a disreputable source.
http://www.srebrenica-project.com/index.php?option=com_content&view=article&id=156
RUDD bottled it. Keating was happy to win by 7 votes.
Abbott should form a draft rudd movement.
A new kevin needed to make one mistake and the old kevin would have taken labor below 30%