Monday Message Board

Back again with another Monday Message Board.

Post comments on any topic. Civil discussion and no coarse language please. Side discussions and idees fixes to the sandpits, please. If you would like to receive my (hopefully) regular email news, please sign up using the following link You can also follow me on Twitter @JohnQuiggin, at my Facebook public page   and at my Economics in Two Lessons page

54 thoughts on “Monday Message Board

  1. The recent comments and behaviors of Scott Morrison and Josh Frydenberg are revealing of their true attitude and hidden agenda with respect to the COVID-19 pandemic.Their true attitude and hidden agenda can be summed up like this. “Open up, no matter what. Let the pandemic rip. Deaths don’t matter. Only wealth matters, particularly the wealth of, and consequent donations from, our business backers.”

    That is the essential message from Morrison and Frydenberg once stripped of its contradictions and obfuscations. Frydenberg claims Dan Andrews and the Victorian government do not have a “road map” out of the pandemic. Actually they do. The road map is the set of expert advised, model informed, lock-down levels and the triggers (in terms of rising or falling numbers) for changing the levels. That is the road map. The key fact about a road map ( made plain for the fools who blithely misuse the road map analogy) is that roads must be passable to be used. I may have a road map from Town A to Town B. There may be five alternate routes. However, if all routes are seriously flooded then as they say “If it’s flooded, forget it!” The same applies to a road map out of COVID-19. If critical areas are flooded with COVID-19 cases (with “flooded” defined by epidemiological experts and expert standards) then forget it. You can’t follow the road map, or the actual road, out of lock-down yet.

    Morrison’s and Frydenberg’s claims about economic damage in Victoria (real in itself) and the “need” to open up other state borders, do not tally. If the economic damage from a state’s hard lock-down is so great then risking other states by forcing them to open prematurely is illogical. Premature opening of other states will just make them economic basket cases like Victoria is currently under its necessitous hard lock-down.

    Morrison and Frydenberg are now pushing for the premature re-opening of Victoria and of other state borders in the face of rising case numbers in Qld and NSW! This is only consistent with a strategy of “spread the virus and let it rip”. Morrison and Frydenberg clearly want a US-style COVID-19 disaster here in Australia. Why is that? The majority of the people are against that course of action. The majority of expert epidemiological and medical opinion is against that course. The majority of academic economic opinion (so far as I can tell) is also against that course.

    Who is in favor of such a course? It can only be the monied backers of the LNP: those large owners of capital who value their own wealth accumulation higher than both other human lives and the long-term heath of the overall economy. The healthiest economy today is the COVID-19 elimination economy which does limited but hard lock-downs at need to put down spot outbreaks and can then operate fully open domestically for most of the time (and place). China and New Zealand, to name two, are proofs that this strategy works. The USA and the EU are proof that the “let it rip by stupidity, accident or design” strategy is a strategy for much higher long-run human and economic pains and costs.

    We can also notice that the MFs (the Morrison-Frydenbergites) are really only attacking the Labor states. This whole attack is political and ideological: nothing to do with science and nothing to do with any enlightened and objective economics which cares for more than just elite capitalist wealth accumulation: indeed cares for human lives, overall economic health and the longer term.

  2. Where is the frontier of economic development right now?
    — Macau 129,103
    1 Luxembourg 121,293
    2 Singapore 101,376
    3 Qatar 96,491
    4 Ireland 88,241
    — Cayman Islands (2018) 72,481
    5 Switzerland 70,989
    6 United Arab Emirates 69,901
    7 Norway 66,832
    8 United States 65,281
    9 Brunei 64,673
    — Hong Kong 62,375
    10 San Marino (2018) 60,750
    11 Iceland 60,061
    12 Denmark 59,830
    13 Netherlands 59,687
    — Bermuda (2013) 59,483
    14 Austria 59,111
    15 Germany 56,052
    16 Sweden 55,815
    — Taiwan 55,078
    17 Belgium 54,545
    18 Australia 53,320
    19 Kuwait 51,912
    20 Canada 51,342
    Yes í´m a sucker for that kind of lazy wikipedia list armchair analysis. So the last querubble about Singapore reminded me of this list. The Heritage foundation would havy an easy job to turtore that top 20 data in a way that it confesses low taxes on capital and the like are great for gdp.

    That´s not true of course in any meaningfull way. The smaller nations, on that list, pretty much everyone below 20 million inhabitants (maybe not Norway? enough oil anyway) are all free riding the rest of the world by operating as a tax haven to some extend. Some smaller ones don´t do anything else usefull like Ireland.They are also doing it in a way that just distorts their gdp numbers: Ireland is not really anywhere that rich in reality. Luxemurg is pretty much tax haven only aswell. Others got huge basic resource windfalls – Norway, Emirates, Brunai etc.
    City states are also pretty meaningless. If you´d remove Sydney from Australia as an independet state, that would also be a super rich nation. It works even better with a major port serving a larger population.

    Ok, lets shorten this a bit, if you look at these countrie more closely, there is just one anomaly, that is not easy to explain, the US. For the rankings within the rest, it is just not obvious how any nation could catch up to the other one easily, there is just nothing that could be replicated, even when comparing nations that are not all oil/tax evasion. For example the Netherlands do have some gas windfalls and some tax evasion while Germany still got some drag from the east: Overall no real edge left there. So while i got a lot to bitch about my nations education system or any other kind of problems, its unlikely moving up to being the world benmark would make all that much of a difference in gdp. Now to the US: Considerng how much worse other indiactors of human well being besides gdp are there ppp gdp might just be distorted as our host already suggest some time back in a post.

  3. Ikonoclast,

    You write: “The USA and the EU are proof that the “let it rip by stupidity, accident or design” strategy is a strategy for much higher long-run human and economic pains and costs.”

    There are enormous differences between the USA and the EU and, to a lesser extent within the EU regarding infection and death rates per unit of population. Moreover, with the exception of the UK (still in Europe) and Sweden, none of the EU countries has followed a “let it rip” policy. The UK was late, relative to mainland EU countries in introducing containment measures. The PM of Sweden has acknowledged their policy of appealing to people to do the right thing was not sufficient to protect particularly people in aged care facilities.

    The infection rates are, at least to some extent, dependent on the testing rates. Death rates are also contain an element of uncertainty regarding the recording. Still they provide an indication of differences.

    Death per 1 million population as at yesterday [source; worldometers live]

    Australia: 26

    USA: 565

    EU countries (sample of 13 only)
    Greece 25
    Chechia 39
    Norway 49
    Austria 81
    Denmark 108
    Germany 112
    Portugal 178
    Netherlands 363
    France 469
    Sweden 576
    Italy 587
    (UK 611)
    Spain 620

    Italy, Spain and France had a much more rigorous lock-downs than Germany, but similar to that of Greece (the outcome is very different). I understand there are many factors that contribute to the large variation in this statistic. For example, the timing of the introduction of restrictions, urbanisation, prevalence or otherwise of elderly people living in aged care homes, health care infrastructure and many more. One specific location specific factor is the nature of the initial outbreak. The wide-spread initial outbreak in Italy overran the hospital system. By comparison in Germany the first person (person zero) was quickly identified and contact tracing resulted in a quick containment.

    The borders between EU-Schengen countries were closed for quite some time, except for goods traffic. Later on it transpired that special arrangements had been made for border town residents. The closure was said to be necessary to have time to coordinate the policy measures between the EU countries.

  4. 35% of Americans say they would not take a shot of a safe vaccine even were one available. This is a suggestion for paying people to take a shot of a safe vaccine:

    It seems to me this works better politically than punishing people (with fines or heightened restrictions) for not taking a shot. At v$1000 per head, the total cost is negligible compared to the ongoing costs of the pandemic.

  5. Exciting news for us e-bus aficionados! Panama City is buying:
    “MiBus has decided to cancel an order for 160 new diesel buses and purchase electric buses from BYD instead. In total, MiBus will spend $35 million to purchase 195 medium size electric buses for use in Panama City.”, via CleanTechnica.

    The news here is the price, $180,000 each. The now obsolete Wikipedia page on the bestselling BYD K9 12-meter bus gives the minimum price as $395,000. In 2018, BNEF used reference price of $450,000 for an equivalent diesel bus; this won’t have changed much since. BYD are now selling electric buses much cheaper than diesel. Since they have always been far superior on every other metric – fuel costs, maintenance, CO2 emissions, air pollution, noise, driver and passenger comfort, while range is perfectly adequate – the choice is now a no-brainer.

    Could this be a one-off explained by special factors? I can’t see why BYD would sell at a loss just to break in to one tiny market. I would like to think that it’s down to the fact that that the bus operations contractor, FirstGroup, is based not just in canny Scotland but in notoriously flinty Aberdeen, but I don’t believe it. Occam advises us take the news at face value, subject to disconfirmation.

    Assuming it’s true, it won’t just be diesel bus manufacturers going out of business pretty soon. Electric trucks use the same LiFePo batteries, and are orders of magnitude more numerous. Long- distance electric haulage requires heavy investment in 1 MW fast chargers on the roadd, but that’s a just a small part of the truck fleet. Electric trucks are already technically fine for hub-and-spoke regional distribution, where charging can be done at fleet depots and regular destinations.

  6. Correction: it’s trucks in general that are more numerous than buses, not electric trucks – yet.

  7. Harry, it seems to me the USA population is not representative of that in many countries anymore, if it ever, was, regarding many but not all areas of social, economic and political life. The US health system is surely a point in case as are their versions of various religions that are also known in other countries. If payment works in the USA that is fine. But there is no need to copy it in other countries. Not all populations respond only to monetary incentives.

    But thanks for passing on the Greg Mankiw’s blog link.

  8. Ernestine Gross,

    It’s hard to find aggregate data for the EU on some issues. As far as I can see, the EU since Brexit now has about 150,000 deaths from COVID-19 in a round number. The EU population since Brexit, is about 450 million. That gives a death rate of 333 per million compared to USA’s 565 per million by your figure. It’s not even twice as good, let alone an order of magnitude better.

    I would rate something like an order of magnitude better than the USA as a reasonable benchmark for having avoided “letting it rip” to date. That would set the effective response-to-date benchmark at about 50 deaths per million. Above that is an ineffective response to date. China claims a rate of 3 deaths per 1 million. That may or may not be credible. But then again Taiwan claims 0.3 deaths per 1 million. By contrast to these achievements, 50 deaths per million seems a very lenient benchmark for developed countries. The USA and EU are in the positively dreadful category. These are signs of advanced systemic political economy and social decay presaging likely comprehensive collapse.

  9. Ikonoclast – “Who is in favor of such a course? It can only be the monied backers of the LNP: those large owners of capital who value their own wealth accumulation higher than both other human lives and the long-term heath of the overall economy.”

    …In short, Australia’s great China era just ended and it will be all downhill from here.

    Which brings us back to the timing of the pivot. Is Scotty from Marketing ready for this? If he were, then he would be busy creating a very different economic plan than the one he has, which might be summarised as:

    •open all domestic borders to spread COVID-19 across Australia so he can reopen the national border;
    •flood the joint with foreign students and temporary foreign workers to reboot mass immigration, and
    •force up house prices.

    That plan can be labeled ‘Homicidal Howardism’. For its general outline, let’s turn to a speech by Immigration Minister Alan Tudge on Friday: (…)

    A measure of just how far short of any kind of China-pivot economic plan is Morrison is what it should actually look like:

    •massive taxation and export tariffs on mining rents shoved into a sovereign wealth fund;
    •RBA and APRA banged together and Phil Lowe replaced by a mercantilist to force all monetary easing into the currency;
    •negative gearing reform to deflate property;
    •any and every productivity reform unleashed;
    •get the universities off the Chinese tit and fund research publically;
    •gut the gas cartel to crash energy prices;
    •a huge push into renewable energy and post-carbon economy;
    •massive tax and regulatory incentives to rebuild the industrial base;
    •huge infrastructure investments to keep the nation employed as we transition.

    That is, a competitiveness and nation-building agenda so far outside of the world view of contemporary IPA-driven Coalition trickle-down numbskulls that it is heresy.

  10. There is this outfit in California called the Antelope Valley Transit authority. They are charging their electric busses using solar and further battery storage to go with the solar. Sounds like a very good usage for solar because its off-grid. I think trucks will be a bridge too far. Because the idea with trucks is to load up as much as possible and the battery will be too much of the load. Whereas with busses you are not trying to max out the load. But still that would be a pretty good thing to get most of the sunshine city busses electrical.

  11. @ 11:54 am,

    in addition to “huge basic resource windfalls” Norway has built a massive sovereign wealth fund for the long term. How does the revenue and growth from that already rate against their oil revenue? Pretty good, I’ll bet.

    In contrast Australia has given away cheaply and then even squandered most all of the pittance remaining after the routine local oligarchy directed sell outs of what might have been Australian “huge basic resource windfalls”. And Australia has just now bit off the Chinese hand that was feeding it! That wiki top 20i list needs updating.

  12. Try To Remember 7:18 pm – “When vaccine advocates say that a vaccine is effective they don’t mean its effective. They mean it creates antibodies. Which is not the same thing as being effective.”

    A good vaccine initiates a wider immunological response than initial antibodies..

    No, terminology is important. By ‘effective’ scientists working in the field mean a measure of how a vaccine offers protection against a disease in “real world” conditions. Another measure, ‘efficacy’, is the measure applied in controlled circumstances like a clinical trial. Effectiveness is usually lower than efficacy.

  13. Ikonoclast,
    It is simply not true that the EU countries I have listed have followed a “let it rip” policy. I don’t know much about the policies followed by countries, which joined the EU in the more recent past, although I know Poland and Hungary have relatively low rates.
    It is not possible to infer the policy from the death statistics because the initial conditions differ, as I have tried to indicate with a couple of examples.

  14. TryToRemember: I don’t see why bus companies should get into the energy production or storage line, beyond the opportunities open to any business like rooftop solar panels and, especially, V2G. Grid emissions are not their problem. Storage will be cheapest if left to utilities and independent energy producers who have access to the full range of storage technologies, from grid batteries ($100,000?) to pumped hydro ($1bn?). There are some psychological and emergency backup benefits from home battery storage, and I may even get some myself to go with the new solar panels, but basically it’s just a big market failure.

  15. Covid-19 deaths for Europe since February. (I hope the embedding works). The recent surge in cases is not matched by a rise in deaths. Probably we are just seeing the effect of far better testing, catching far more low-symptom cases among children and young people than in April.
    Find more statistics at Statista

  16. James, in Australia the solar feed-in tariff can be zero while the retail price of electricity can be over 30 cents. This creates an opportunity for arbitrage with home and business batteries. (The fact they are not already popular shows how cruddy home and business batteries are at the moment. But I’m sure they’ll improve.) This arbitrage opportunity remains no matter how cheap utility scale storage gets.

  17. Ronald: What you say is true, but why should I not see the distorted incentives as a market failure? In Germany, the similarly sky-high retail price to households is quite consciously a subsidy to keep German industry competitive (even aluminium smelters, which David Ricardo would say should be moved to Iceland along with the geothermally heated bananas). What’s the excuse in Australia?

    The distorsion is present to a lesser degree here in Spain. The new solar panels I’ve contracted for will, when they replace grid electricity, save me 11.3€c/kwh, the marginal cost of grid supply. But my exported surplus at other times will only get the wholesale rate, about 5c/kwh. Endesa (my utility) will resell this to my neighbours at 11.3c/kwh, with negligible use of transmission and distribution infrastructure. Money for old rope, for them. So I will have an arbitrage opportunity to shift this 5c electricity to the 11c box with a battery. The gain to the whole economy and to cutting emissions will be negligible – unlike the panels themselves, which genuinely do cut emissions and save on capacity investment.

  18. Green steel update: The HYBRIT test plant in Sweden for hydrogen DRI has started operations. Photo: It’s not yet a steelworks, but it is much bigger than a lab testbed. This is real money and real engineering. Arcelor-Mittal are building another test plant in Hamburg, but I can’t find a photo. Instead, the stunning Elbphilharmonie, which looks like a futuristic steelworks but is actually a concert hall.×1024.png

  19. “TryToRemember: I don’t see why bus companies should get into the energy production or storage line, beyond the opportunities open to any business like rooftop solar panels and, especially, V2G.”

    In the case of the Antelope Valley Transit authority the say they’ve saved a lot of money doing so, and the boss seems to think that their supply security is much better this way. The thing is that these bus companies have a lot of parking space. Therefore they have a lot of places to stick up solar panels. They seem to be doing very well from it and they aren’t destabilising the grid. So it may turn out that a bus company in a sunny city may be almost uniquely suited for generating its own power through solar. I mean the boss could be gilding the lilly, but I got kind of excited over it.

    Contrast this to our alleged national scientist talking about exporting hydrogen to Japan. Some ideas are so inherently foolish they ought not be attempted. I like that hydrogen steelworks idea but to be efficient the hydrogen needs to be generated and used pretty much on the spot. Hydrogen is not to be compressed and transported great distances.

  20. On the vaccine issue “Try to Remember” raises many points which I’ll read up on. I always treated it as a “balance of probabilities” issue. Namely, that the chance of contracting a disease*cost to me of getting it was much greater than the expected damage from a vaccine.

  21. Ernestine Gross,

    My wording was poor. Perhaps, I should have characterized European approaches to COVID-19 as the absence of coherent or effective strategy, This refers to both preparation and response. The EU (like most of the world) was unprepared for COVID-19, as a novel zoonotic disease challenge, and responded poorly. The threat was underestimated and the responses were either ill-conceived, inadequate or both. This applies even to Australia. We avoided a significant first wave, mainly by accident and advantages of geography, but are now having a significant second wave. Our response too is on the cusp of turning into a rank failure .

    Essentially, I meant that the empirical outcomes of the EU are not significantly distinguishable from the outcomes of the US. When some countries (including the crowded and not fully developed original epicenter of the virus) can do ORDERS OF MAGNITUDE better than both the US and EU, then the US and EU outcomes are exposed as rank failures by comparison. In an exam, to get a mark half as good as that of the elite students is usually considered a failure. To get a mark orders of magnitude worse is like “Did you do anything? Did you open a book? Did you prepare at all?”

    We ought to hold our entire societies to a very tough standard because the challenges that are yet to come will collapse our societies and destroy us otherwise. Denials and “passes conceded” will not cut it. We will die en masse in the next few decades unless we change things radically. I refer not only to COVID-19 but to the waves (plural) of zoonotic diseases headed our way plus of course climate change, earth cycle breakdowns, the sixth mass extinction and other related challenges.

    Yet, we fell in an undignified (and death-inducing) heap at the first low hurdle. What a disgraceful and disturbing performance by the West. The Sinic East has eclipsed us to an extraordinary degree and shown us what can be done. The COVID-19 crisis is a low bar, a mild challenge, compared to the crises to come. If we set our bar so low that we can’t even get over the first hurdle then pity help us down the track. The hurdles will be much higher.

  22. James, even if we were paying the US average of 18 dollarydoo cents per kilowatt-hour the opportunity for arbitrage would still exist for home and business batteries. Australia is a weird outlier where it will make financial sense first.

    Outside of a few special situations such as a property being limited to zero solar exports, batteries don’t decrease emissions and instead, of course, increase them. No one here believes batteries decrease emissions in normal use except for two groups — people and politicians. This may actually be one group, as my understanding is people are also politicians.

  23. Ikonoclast, yes several ministers in EU countries have acknowledged lack of preparedness for the pandemic on the EU level. This is why they needed to close the inter-European borders for some time, except for goods (rather like border closures between States in Australia). They also acknowledged their dependence on exports from China of medical supplies and their resolve to not let this happen again (with measurable results in a very short time). Isn’t this what makes living in a liberal democracy worthwhile? It is in my opinion. Moreover, the governments of liberal democracies (social democrats included) also explicitly depend on the cooperation of the public.

    Sweden is, in a sense in the best position within Europe to take the notion of a liberal democracy to its limit in a pandemic. The largest city has less than 1 million inhabitants. The level of education may be classified as high and universal. The population is more homogeneous than that of say the UK, which reduces the language problem. The health and social security system is among the best in the world. Its border with Norway consists of a mountain range with very few people, if any, and with Finland, a former colony of Sweden (long ago), which introduced restrictions very early. This leaves a bridge to Denmark, a country that also introduced restrictions very early.

    Still, relying on individuals’ acting responsibly didn’t quite work as assumed. I suspect many articles have been written and will be written analysing why it didn’t work as assumed. There is one possible cause I am prepared to offer: Lack of relevant information. That is to say, six months after the start of the pandemic there are still new scientific results being published every day. These results were not known in March. Moreover, it exceeds an individual’s capacity to take in the new results on any one day. Some governments of EU countries that were not overrun by multiple clusters at the beginning stated explicitly that the lock down is necessary to gain time for scientists and politicians and the public at large to learn about this new virus and to work out how to deal with it.

    So, the EU countries, rather like Australia, used lock downs only sparingly and on medical advice. It is not easy, IMO, to find a balance between fundamental human rights in a liberal democracy and public health. It is impossible to achieve this without errors (ex post), IMHO.

    It seems to me, people, including journalists, tend to have difficulties dealing with a dynamic process which involves an exponential growth rate of at least one variable. Barely a day passes without a journalist or business lobbyist or commentator asking for a date when things return to normal. Where are the efficient market hypothesis people, I wonder.

    Of course in a dictatorship the desired outcome is achieved by decree, irrespective of what actually goes on.

    As for China, I understand scientists in EU countries exchange their findings with Chinese scientists. They speak the same language and hopefully they know how to avoid getting entangled in the geo-politics.

  24. I continue to hold the position that the COVID-19 crisis is a relatively small crisis compared to the crises to come. If certain empires (I consider I use the term advisedly) like the USA and the EU cannot cope with this relatively mild crisis, there is little to no hope that they can cope with the more serious crises to come, unless they radically reform themselves.

    Chris Hedges does a good line in jeremiads. He has been predicting disaster for years for the USA and has been proven correct to date. I feel he probably will be correct about the future too. He predicts terminal collapse for the USA.

    We had better hope he is wrong. If the US collapses they will bring the world down, quite deliberately, in the process. Hoping Hedges is wrong means hoping for revolutionary change. Without revolutionary change, the collapse of the USA and thence the world is a near certainty.

    The time is over for books, speeches and debates alone. The time for voting and taking direct action to radically change our entire political economy has arrived. Radical language, voting and direct action all have to operate in concert. Any one or two are powerless on their own. In a two-party, one-ideology state, where the wealth and power elites have captured the parties, voting on its own is useless. No matter who you vote for you still get a neoliberal capitalist apologist or a right wing reactionary. The two-party, one-ideology, neoliberal state, is a ratchet and hold system. The right (or ultra-right as it is now in the US) ratchets up neoliberal measures and tightens law and order screws on the people. The faux-center (really a mid-right) candidate group , if they win, then essentially hold the system at the current point. Real reform does not occur.

    Speech and debate handled properly can provide logical and moral suasion. Non-violent direct action, also known as civil resistance may include sit-ins, strikes, workplace occupations, street blockades, hacktivism or counter-economics (though difficult to organize responsibly in a pandemic). Violent direct action may include political violence, assault, sabotage, arson and property destruction. I do not advocate violent direct action for moral, strategic and tactical reasons. (I will expand on that if people want me to.) In contrast to the above, electoral politics, diplomacy, negotiation and arbitration are not direct action: they are electoral action in the accepted, rigged and gamed paradigm.

    Speeches and debates, as logical and moral suasion for left politics can and will recruit like-thinking supporters of the same class, and natural ally classes, to the cause. (There is the exception of one class which should be a natural ally class of left politics but is actually recruited to the reactionary right by anti-intellectual, nationalist and racist appeals. These are the anti-intellectual, nationalist and racist elements of the working class.) Debate and rhetoric will line up existing supporters and sympathisers and move some “undecideds” into your camp. Such words will have no effect on capitalists, their supporters and apologists, nor any effect on anti-intellectuals and essentially neo-fascist nationalists and racists. Left logic and suasion are force-less on those who will lose by the implementation of greater equality. It is also force-less on those too brutish to possess empathy and/or too unintelligent or brainwashed to understand their own enlightened self-interest. These classes understand only one thing and that is power, brute power, or kinetic force as the military and security theorists call it. Kinetic force means blows and bullets essentially. This is the true “language” of reactionary politics. Called “law and order” it is really retributive and terroristic violence.

    The demonstration of logical and moral suasion power is force-less against the capitalists and their reactionary working-class element supporters. (Not all the working-class is reactionary of course, only a large minority of it.) The next form of demonstration is the demonstration of numbers. People can be intimidated by numbers alone. The true object of peaceful demonstration and non-cooperation is to show great numbers, if possible. Great numbers, sheer masses, show a potential for power and an implicit threat even in a peaceful outward form. Peaceful masses show a hinted threat of violence, at the very least as a threat of just resistance to unjust oppression and violence. Voting then is the way of counting support, counting the numbers, as well as being a method of changing governments.

    If many logically and morally powerful arguments are made, and then many numbers are marshaled on the streets, in the workplaces and in cyberspace and then many votes are cast at the elections for socialist candidates, then and only then will there be a multiplicative or synergistic effect. It will require this kind of overwhelming demonstration of people power to change political economy in the West.

    When things get bad enough people do rebel in radical ways, if history is any guide. Things will certainly get bad enough. The climate crisis, the 6th mass extinction and related crises will absolutely drive this. These will be inescapable real changes on a vast, momentous and disastrous scale The USA is in the vanguard, showing us where all this is heading. As the US trends today, we all will trend tomorrow unless we radically change our regional and global systems.

  25. Some good news. There is a new plane out. Streamlined top and bottom, so shaped like a dirigible or a whale. Its so fuel-efficient it might force everyone into six seater covid-safe luxury. It can spend a lot of its time gliding. Once its up in the air its miles per gallon is more akin to that of a car.

    How about that. Being compelled to give up on crowded airports and crowded planes just because of the reality of aerodynamics? If its all true then, thats an whole new era of flying. I suspect the horror of Covid, if not the Covid itself, will be around a long time. Mr Otto might find himself very wealthy late in life. With this alternative you’d never even consider flying in a big crowded jet again. Who wants to share viruses with everyone aboard these days right?

    The plane is the Celera 500L.

  26. If, and it is a big IF, there is an even “Greater Recession” after this pandemic runs its course, then how does globalisation recover its ascendancy? This is not the 1920s. There the world had lost lives in the First World War so were not easily shocked by lives lost to the Spanish Flu. I am not sure consumer confidence levels can be that resilient in the 2020s. Also there is the social decay occurring in the USA. No matter who wins the next Presidential election (and more importantly the half congressional election) the USA will be a bitterly divided nation. How can it recover its economic dominance with this level of social unrest? At least Europe is more settled today than it was before the pandemic. The Euro zone is the only real chance for globalisation. China may be entering a period of War Communism, at the very least it will still be caught up in a trade war with its biggest market. Russia is a basket case of poor macroeconomic management decisions. The Asian Tigers feed off trade out of Europe. Africa seems tied up with the fate of China. As for Latin America it has always run its own race. Where does that leave our own region. We are all caught between the proverbial rock and hard place. Yes the UK, still the fifth largest economy in the world, will be more heavily involved in our region in terms of trade relations and tourism. But will that be enough to make up for the trade freeze we are coping from China? Globalization requires a degree of foreign tolerance that seems to be missing at the moment. Disguised protectionism seems to be occurring in many parts pf this new normal world. So is globalisation finished? It may be too early to call this one but it does seem to be a possibility for the twenties. .

  27. Do we want globalisation? Doesn’t it contain with it over-optimisation, lack of redundancy, debt peonage and imbalances that don’t get corrected? I think its better to hope for a more fuel efficient manufacturing resurgence than to be too hung up on whether its globalised manufacturing or not. I’d settle for it either way. Maybe also a somewhat decarbonised manufacturing renaissance.

    We should talk to Mr Otto and start turning the Celera 500L out like sausages. Even perhaps with on-the-spot hydrogen for the welding work. There could be something for everyone in a manufacturing revival. See the riots in the US? Would these people be getting in so much strife if they all had well paid unionised work?

  28. ideas thread said this may be of interest in the spirit of serendipity;

    “The lady doth protest too much, methinks’: Truth negating implications and effects of an epistemic frame trap.”

    Insights into the Workings of an Epistemic Frame Trap

    Marion Nao adds a discourse analytic perspective to imperfect cognition via Goffman’s sociological theory of frame trap. It presents some key insights from a recent paper in Language and Communication, entitled:  ‘The lady doth protest too much, methinks’: Truth negating implications and effects of an epistemic frame trap.

    Marion Nao holds a PhD in Language and Communication Research from Cardiff University, UK, and currently teaches online for Universitat Oberta de Catalunya, Spain.

    “Many of us may be uncomfortably familiar with the concept and experience of a double-bind or Catch-22 situation, in which, crudely put, you’re damned if you do and damned if you don’t. Add to the complex a discursive mechanism by which the more you do, the more damned you are, in anticipation of which being damned if you don’t might seem like the lesser of the two evils, and you likely have the workings of a frame trap. In short, and metaphorically, with increased resistance, you tighten your own noose. So, how does frame trap work, and why might it be relevant to biased beliefs?”…

    (Imperfect Cognitions
    Blog on delusions, memory distortions, confabulations, biased beliefs, and other imperfect cognitions.
    Tuesday, 25 August 2020)

  29. Queensland Apocalypse update
    Item in The Guardian about “large carpet snakes that fell through the ceiling of a Queensland home on Monday while apparently engaged in a fight with another male over a female snake.”
    From the photo, the celling is flimsy plasterboard. Looks like yet another regulatory failure of neoliberal government to protect hardworking Australian families against long-tail risks.

  30. One for the iconoclasts from Steve Keen:

    Dr Keen: Economics “drastically underestimating climate damage”
    By David Llewellyn-Smith in Carbon Economy
    at 11:20 am on September 2, 2020 | 12 comments
    Via Dr Steve Keen, cross-posted from Taylor and Francis:

    The appallingly bad neoclassical economics of climate change
    Steve Keen
    Published online: 01 Sep 2020

    Forecasts by economists of the economic damage from climate change have been notably sanguine, compared to warnings by scientists about damage to the biosphere. This is because economists made their own predictions of damages, using three spurious methods: assuming that about 90% of GDP will be unaffected by climate change, because it happens indoors; using the relationship between temperature and GDP today as a proxy for the impact of global warming over time; and using surveys that diluted extreme warnings from scientists with optimistic expectations from economists. Nordhaus has misrepresented the scientific literature to justify the using a smooth function to describe the damage to GDP from climate change. Correcting for these errors makes it feasible that the economic damages from climate change are at least an order of magnitude worse than forecast by economists, and may be so great as to threaten the survival of human civilization.

    William Nordhaus was awarded the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel (Mirowski, 2020) in 2018 for his work on climate change. His first major paper in this area…

    This practice was replicated, rather than challenged, by subsequent Neoclassical economists – with some honourable exceptions, notably Pindyck (2017), Weitzman (2011a, 2011b), DeCanio (2003), Cline (1996), Darwin (1999), Kaufmann (1997, 1998), and Quiggin and Horowitz (1999)…

    The end product is a set of purported empirical estimates of the impact of climate change upon the economy that are utterly spurious, and yet which have been used to calibrate the ‘Integrated Assessment Models’ (IAMs) that have largely guided the political responses to climate change…

    …Conclusion: drastically underestimating economic damages from global warming

    Were climate change an effectively trivial area of public policy, then the appallingly bad work done by Neoclassical economists on climate change would not matter greatly. It could be treated, like the intentional Sokal hoax (Sokal, 2008), as merely a salutary tale about the foibles of the Academy.

    But the impact of climate change upon the economy, human society, and the viability of the Earth’s biosphere in general, are matters of the greatest importance. That work this bad has been done, and been taken seriously, is therefore not merely an intellectual travesty like the Sokal hoax. If climate change does lead to the catastrophic outcomes that some scientists now openly contemplate (Kulp & Strauss, 2019; Lenton et al., 2019; Lynas, 2020; Moses, 2020; Raymond et al., 2020; Wang et al., 2019; Xu et al., 2020; Yumashev et al., 2019), then these Neoclassical economists will be complicit in causing the greatest crisis, not merely in the history of capitalism, but potentially in the history of life on Earth.”

  31. Ceilings can be made from something other than flimsy plasterboard? But… how would the snakes fall through?

  32. One ought not get too excited about Keen critiquing Nordhaus. Neither of them are scientists. Certainly I’d tend to side with Keen on most matters economic. We have the positive externality of CO2. It increases net primary production and makes growing things easier so keeps food prices low. But seeing this opportune level of CO2 in the atmosphere what do we do with it? Do we just let it reduce of its own accord or should we seize the moment and use this pure dumb luck to create a lot of soil and green the deserts? I would go with the latter and one would think the CO2-haters would want that also. But if you are going to be crazy and wrong about one thing you are probably going to be crazy and wrong about many things. So I don’t see a lot of common cause being likely.

  33. The Unraveling of America.

    And yes, of course, the whole climate is unraveling too. But at current rates, the US will unravel first.

    The possums that used to gallop and fight in my roof space never fell through the ceiling. Conclusion: Possums are lighter than carpet snakes Stands to reason. Carpet snakes eat possums.

    Am I saying the US is the (o)possum and China is the Python? Maybe. In that case Climate Change is the Titanoboa.

  34. A little Birdy told me: “Neither of them are scientists.”

    Sad. What of the scientists and science cited in the paper?

  35. +1 “Svante says: AT 8:01 PM
    A little Birdy told me: “Neither of them are scientists.”
    Sad. What of the scientists and science cited in the paper?”.

    Thanks for the link.

    Steve Keen’s big idea.

    “MINSKY: Reforming economics with visual monetary modeling

    “Computer program for building & visually simulating dynamic, monetary economic models. A vital tool for a new approach to economics

    “Professor Steve Keen Explains Minsky Pt II – Bank Models
    youtube com/watch?v=gfOURFkMhKM

  36. I recommend this talk on Youtube by Professor R. D. Wolff.

    “Economic Update: China: Capitalist, Socialist or What?” (Link below.)

    This a good talk for all on the left and right to watch. It gets beyond ideology and outlines what Russia was really like (at the economic level) and what China is like now (at the economic level). It illustrates that Russia and China never progressed beyond “state capitalism”. It illustrates that “socialism” (really “state capitalism”) was only different in degree, not kind, from mixed economy “capitalism”. It illustrates the need to get beyond ideology (yes, I am looking at myself too) and analyze real political economy systems historically and structurally and look at how they actually work(ed).

    It raises some interesting thoughts about private property which I want to pursue at a later date. This video might prime us to think about about the inescapability of personal property and maybe even private property. No, these thoughts do not mean I am becoming neoliberal. Talking about the inescapability of private property does not imply support for a system where 1 person has a billion dollars accumulated and a billion persons each have one dollar accumulated.

    Note: If anyone can tell me how to post these links without putting the windowed video straight into the comment that would be good. I don’t want to fill up J.Q.’s blog with windowed videos.

  37. Dr Keen on MMT and the virus economy LIVE 12:30 AEST
    MB Fund Podcast:

    “..On the agenda, we give an overview of how the Coronavirus crisis will have impacted the already fragile economy when all is said and done, addressing the fiscal and monetary policy responses available to government. We then switch our attention to MMT, where Professor Keen will talk us through his Minsky modelling of MMT and how he believes MMT can be utilised in the economy during the COVID pandemic and to combat chronically low inflation, along with the resulting outcomes of MMT compared with traditional economic approaches”

    #MMT #ModernMonetaryTheory #CoronavirusEconomy
    Is MMT the solution to the Coronavirus Economy? with Prof. Steve Keen | Nucleus Investment Insights
    62 watching now
    •Started streaming 32 minutes ago

  38. KT2, 7:04am, “Steve Keen’s big idea.”

    Thanks KT2, but I think the ideas published by Keen in “The appallingly bad neoclassical economics of climate change”, 01 Sep 2020, are bigger!

    His exposure of how the craven loony duplicitous magical thinking majority of economists in lock step since 1993 have sold the world down the drain and into the closing jaws of global climate, global extinction level catastrophe is a BIG wake up call!

    Just for example, who knew how the garbage these rats have thrived on and passed around amongst themselves had such great sway in the decisions and reports of the IPCC? Their economics rubbish has been passed off and accepted as climate science! Their climate related pseudo science is given greater weight than fair dinkum climate science!

    As Prof Keen writes at one point it’s all “GIGO” – garbage in, garbage out. W Shakespear’s line “first we kill the lawyers” has often been used out of context. I can think of numerous new appropriate contexts for an altered wording: “first we kill the lawyers economists.”

    A few snips below, some emphasis mine:


    …The impact of these economists goes beyond merely advising governments, to actually writing the economic components of the formal reports by the IPCC (‘Intergovernmental Panel On Climate Change’), the main authority coordinating humanity’s response, such as it is, to climate change. The blasé conclusions they reach – such as the following from the 2014 IPCC Report (Field et al., 2014) – carry far more weight with politicians, obsessed as they are with their countries’ GDP growth rates, than the much more alarming ecological warnings in the sections of the Report written by actual scientists:

    Global economic impacts from climate change are difficult to estimate. Economic impact estimates completed over the past 20 years vary in their coverage of subsets of economic sectors and depend on a large number of assumptions, many of which are disputable, and many estimates do not account for catastrophic changes, tipping points, and many other factors. With these recognized limitations, the incomplete estimates of global annual economic losses for additional temperature increases of ∼2°C are between 0.2 and 2.0% of income. (Arent, Tol, et al., 2014, p. 663; emphasis added)

    This is a prediction, not of a drop in the annual rate of economic growth – which would be significant even, at the lower bound of 0.2% – but a prediction that the level of GDP will be between 0.2% and 2% lower, when global temperatures are 2°C higher than pre-industrial levels, compared to what they would have been in the complete absence of global warming. This involves a trivial decline in the predicted rate of economic growth between 2014 and whenever the 2°C increase occurs, even at the upper bound of 2%.

    Given the impact that economists have had on public policy towards climate change, and the immediacy of the threat we now face from climate change (Amen et al., 2008; Gills, 2020; Gills & Morgan, 2019), this work could soon be exposed as the most significant and dangerous hoax in the history of science.


    Enumeration: it’s what you don’t count that counts

    Since this was the first paper in a research tradition, one might hope that subsequent researchers challenged this assumption. However, instead of challenging it, they replicated it. The 2014 IPCC Report repeats the assertion that climate change will be a trivial determinant of future economic performance:

    For most economic sectors, the impact of climate change will be small relative to the impacts of other drivers (medium evidence, high agreement). Changes in population, age, income, technology, relative prices, lifestyle, regulation, governance, and many other aspects of socioeconomic development will have an impact on the supply and demand of economic goods and services that is large relative to the impact of climate change. (Arent et al., 2014b, p. 662)

    It also repeats the assertion that indoor activities will be unaffected. The one change between Nordhaus in 1991 and the IPCC Report 23 years later is that it no longer lumps mining in the ‘not really exposed to climate change’ bracket (Nordhaus, 1993). 2 Otherwise it repeats Nordhaus’s assumption that anything done indoors will be unaffected by climate change:

    FAQ 10.3 Are other economic sectors vulnerable to climate change too?

    Economic activities such as agriculture, forestry, fisheries, and mining are exposed to the weather and thus vulnerable to climate change. Other economic activities, such as manufacturing and services, largely take place in controlled environments and are not really exposed to climate change. (Arent et al., 2014b, p. 688; emphasis added)

    All the intervening papers between Nordhaus in 1991 and the IPCC in 2014 maintain this assumption: neither manufacturing, nor mining, transportation, communication, finance, insurance and non-coastal real estate, retail and wholesale trade, nor government services, appear in the ‘enumerated’ industries in the ‘Coverage’ column in Table A1. All these studies have simply assumed that these industries, which account for of the order of 90% of GDP, will be unaffected by climate change.

    There is a ‘poker player’s tell’ in the FAQ quoted above which implies that these Neoclassical economists are on a par with United States President, Donald Trump, in their appreciation of what climate change entails. This is the statement that ‘Economic activities such as agriculture, forestry, fisheries, and mining are exposed to the weather and thus vulnerable to climate change’. Explicitly, they are saying that if an activity is exposed to the weather, it is vulnerable to climate change, but if it is not, it is ‘not really exposed to climate change’. They are equating the climate to the weather. [ !!!!!!!!!

    While this is a harsh judgment to pass on fellow academics, there is simply no other way to make sense of their collective decision to exclude, by assumption, almost 90% of GDP from their enumeration of damages from climate change. Nor is there any other way to interpret the core assumption of their other dominant method of making up numbers for their models, the so-called ‘statistical’ or ‘cross-sectional’ method.

  39. Svante – thanks. Bigger but not msnews. Yet. JQ, any comment please.

    Ikon will Bigger appreciate your para… “His exposure of how the craven loony duplicitous magical thinking majority of economists in lock step since 1993 have sold the world down the drain and into the closing jaws of global climate, global extinction level catastrophe is a BIG wake up call!” ☺

  40. Live longer. Make your own age enhancement model. Test your methalation. “fits an elastic net model (a mixed L1/L2 penalized linear regression” [2]

    [2] “Age prediction using machine learning

    By: Ekaterina Polkh, Anup Kumar

    How to use machine learning to create predictive models from biological datasets (RNA-seq and DNA methylation)?

    – Learn ageing biomarkers from RNA-seq and DNA methylation datasets

    – Apply regression based machine learning algorithms

    – Learn feature selection and hyperparameter optimisation

    Introduction to Galaxy Analyses
    Time estimation: 2 hours

    A brief walk through the epigenetic clocks

    [2]. You can make your own here: ]

    “Conceptually, epigenetic clocks are very simple2. One starts from CpG methylation data and an endpoint of interest, such as age or mortality risk. Then one fits an elastic net model (a mixed L1/L2 penalized linear regression) so ultimately one gets DNAmAge=a+b1CpG_1+b2CpG_2+…DNAmAge=a+b1CpG1​+b2CpG2​+…. This is good to frame a conservative case for the clocks: Unlike with fancier statistical techniques it is hard to fudge results using elastic nets; there are fewer hyperparameters to tweak, and being a simple model it is harder to overfit a training set.”
    Last updated: 2020-07-16 
    Is this article wrong?

    …”It has recently been found possible to estimate age, mortality risk, or general health by looking merely at the epigenome. The models used to do so are referred to as epigenetic (or methylation) clocks.

    “Epigenetic clocks are increasingly becoming a popular choice for scientists in the field of aging research to measure the putative efficacy of anti-aging interventions. They may make it possible to get results before full Kaplan-Meier curves are available, and they could serve, at least seemingly, as a replacement for a host of other biomarkers. I recommend reading the introductory sections of The Longevity FAQ as well as those about epigenetics before reading this post as it gives some more context.

    As a quick recap about epigenetics,” …

    May be wonkish / and funded???

    Reversal of Epigenetic Age with Diet and Lifestyle in a Pilot Randomized Clinical Trial

    Kara Fitzgerald,  el al…

    This article is a preprint
    Manipulations to set back biological age and extend lifespan in animal models are well established, and translation to humans has begun. The length of human life makes it impractical to evaluate results by plotting mortality curves, so surrogate markers of age have been suggested and, at present, the best established surrogates are DNA methylation clocks. Herein we report on a randomized, controlled clinical trial designed to be a first step in evaluating the effect of a diet and lifestyle intervention on biological age. Compared to participants in the control group (n=20), participants in the treatment group tested an average 3.23 years younger at the end of the eight-week program according to the Horvath DNAmAge clock (p=0.018). Those in the treatment group (n=18) tested an average 1.96 years younger at the end of the program compared to the same individuals at the beginning with a strong trend towards significance (p=0.066 for within group change). This is the first such trial to demonstrate a potential reversal of biological age. In this study, the intervention was confined to diet and lifestyle changes previously identified as safe to use. The prescribed program included multiple components with documented mechanistic activity on epigenetic pathways, including moderate exercise, breathing exercises for stress, and a diet rich in methyl donor nutrients and polyphenols.” 

    July 14, 2020.
    The copyright holder for this preprint is the author/funder, who has granted medRxiv a license to display the preprint in perpetuity. It is made available under a CC-BY-NC-ND 4.0 International license.

  41. Try To Remember: I don’t monitor the Message Board really closely. But no climate denialism (including scepticism and lukewarmism) is tolerated. If you want to post that kind of material you can put it in the Sandpit.

  42. “I do not reguard his work as representive of the economic profession.”

    hahaha, better be careful. That sounds like an endorsement.

  43. JQ – “I don’t regard his work as representative of the economic profession.”

    The trouble with that as Keen makes out numerous times in passing, indeed serious trouble for the wider economics profession as I see it, is that Tol, Nordhaus, et al, are regarded where it counts and by the public to date as representative of the best the profession has to offer, and as superior authorities on global climate change by both governments and the IPCC.

    In shaping reports, predictions, and responses, their pseudoscience echo chamber has carried more weight where it counts than ‘real’ climate scientists presenting actual science. This is not like the big fossil fuel vested interests pulling strings… Where it really counts this has been taken undeservedly as the cream of disinterested, rigorous academia! Crikey, they even get a Nobel prize for this utter garbage.

    Will the wider profession find similar to Keen on this such that it is brought to the general public’s notice, or will it attempt to bury Keen’s thorough exposure of the sham and allow such rot and craziness within their ranks to carry on?

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