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

30 thoughts on “Monday Message Board

  1. Nice idea. Climate solutions mapped globally linked to blog post of solution. ymmv.

    “The climate solutions map
    “The climate solutions map gathers hundreds of previous posts from the blog archives and maps them across the globe, presenting a journey through the diversity of climate solutions.”

    Post JQ’s nuclear solution. With own icon.

  2. After the Coalitions win in the Hunter region by-election the dominant narrative is that Scott Morrison is a miracle worker again and Labor is out of touch with working people (again). Getting sucked into arguing on their terms is a mistake .All this just months after being exposed running a rape protection racket in Parliament house . Like Boris Johnston and the rest he even gets credit for pretending to fix things that were broken by his own side of politics. Ideological 180 degree turns are no problem ,endless stuff ups and scandals dont count.

    Lets just zoom out a bit and call it for what it is – a slide into post truth tribal politics where winning is the only metric . Its a bargain between the top (tax cuts and deregulation) and the bottom (cultural anxiety) and enough of the middle class to win. Getting dragged into arguing individual issues using only the terms of those in control is a waste of time ,they arent interested in playing by the rules .It is happening here as it is in every other comparable country . In England it is commonly said that people now vote on culture not on economics ,thats the nicest way of putting it. We have gone down the rabbit hole. Its a soul destroying democracy killing election winning formulae .

  3. … In England it is commonly said …

    Many things are commonly said. Some of them are true; some of them aren’t.

  4. Jetan Koshi has been looking at past projections by the IEA and has found them to be inaccurate. This may have been due to the influence of member states and their domestic politics.

    “In its WEO 2008 the IEA “reference scenario” suggested coal power would reach 12,000TWh by 2020

    In reality, coal was 25% lower (-3,000TWh, equiv of overall EU demand)

    Solar output was 8x higher than expected

    Wind nearly twice as high”

  5. J.W.,

    And the speed of Bitcoin transactions is that of a fish in treacle. It is clear that crypto currency was designed as a wealth-transfer scam. The whole intent is wealth transfer by speculation on an asset which is near-worthless in real terms. This is nothing new. Tulips are nearly worthless in real terms. What is the real worth of a tulip? You can’t eat it. It provides no useful products or services except that it’s pretty to look at. Same with non-industrial diamonds. They are common and near worthless except to look at. Their value is created by artificial scarcity. Which is exactly how the value of crypto is created. The artificial scarcity of near-worthless objects to enable wealth transfer scams. That’s what it’s all about. Tulips, diamonds, baseball cards, crypto coins. It’s the same thing each time.

  6. Surely Bitcoin mania is another example of tokenism. To be money an item must be a measure of value. If the dollar value rate of that item changes dramatically, then this becomes questionable. A certain amount of stability is necessary for something to be called money. If, for example, Bitcoin was used as a standard for deferred payments, then few creditors would know what they would get after amortization. As Sinclair Davidson wrote in The Australian Financial Review (Monday 24 May 2021 page 39); Blockchain business models do have a future role in the digital economy. They may even have a role to play in the real economy of the future. But there will be a need for what he calls a “regulatory framework” to support the stability of any cryptocurrency.

  7. blockchain is/was supposed to be absolutely traceable.
    so.your asset couldn’t just disappear (be stolen)

    not so.

    so,it looks to be an energy guzzling waste of space,oxygen and time.

  8. Iko: “Tulips are nearly worthless in real terms. What is the real worth of a tulip? You can’t eat it. It provides no useful products or services except that it’s pretty to look at. Same with non-industrial diamonds. ” Guite wrong. Tulips, diamonds, and gold provide utility in one of its most basic forms, sensory pleasure.

    The Keukenhof tulip gardens near Lisse in Holland attracted 1.5 million visitors a year pre-pandemic, mostly of course in the short tulip flowering season – recommended, but don’t expect to have the place to yourself. The park sits in the middle of great fields of commercially grown tulips, allowed to flower because what’s sold is the bulbs. Useful things can be the object of speculative bubbles just as well as useless ones, there is no iron law.

    There is a fine page of I think Huizinga on the late mediaeval perception of wealth. The Latin for the sin of lust is “luxuria”, and wealth and sensuality were intertwined. The rich man enjoyed he glint of gold coins and jewellery trickling through his fingers, the stroking of costly furs and silks, the light reflected from the hair and breasts of his young mistress. In 1450 they would not have seen the point of abstract and invisible wealth like derivatives or cryptocurrency.

  9. Many products can obtain their sales price in large parts due to the status symbol function. To go one step back, some are not even strictly status symbols, rather simply goods that create most of their value only in social interaction. They don’t however tend to be entirely useless in any other form as James pointed out. Bitcoins (or any other of those thingies) pretty much are useless. Remember last time someone told us we, or at least I got no clue because I didn’t bother to make the distinction to possible other applications of the basic technology, which reveals my technical ignorance and thus must be wrong. If only life where that easy….. we could just let the best mathematicians run things, and who are the best (up to a point somewhere in obscure academic theory) would be relatively easy to figure out by objective tests. Not so, the flaw with cryptocurrencies is too fundamental, predates the technical issues. Scientology’s members also think they are superior beings once they reach some rank in the sect and no doubt all those members know a lot more about the sect than we do. They are still getting scammed by the upper crust which is quite easy to see from the outside.

  10. sunshine@3.54
    ” Lets just zoom out a bit and call it for what it is – a slide into post truth tribal politics where winning is the only metric ”

    Post truth aka Lies.

    Partners… in lies, from the top.

    “A dossier of lies and falsehoods
    How Scott Morrison manipulates the truth

    Paul Krugman;
    …” The Big Lie about the election didn’t well up from the grass roots — it was promoted from above, initially by Trump himself, but what’s crucial is that almost no prominent Republican politicians have been willing to contradict his claims and many have rushed to back them up.

    “Or to put it another way, the fundamental problem lies less with the crazies than with the careerists; not with the madness of Marjorie Taylor Greene, but with the spinelessness of Kevin McCarthy.

    “And this spinelessness has deep institutional roots.

  11. J.W.

    I reference your statement: “Quite wrong. Tulips, diamonds, and gold provide utility in one of its most basic forms, sensory pleasure.”

    Actually I am quite right. Here are my reasons. The indulgence of sensory pleasure is fine provided it does not cause offsetting (and especially larger) negative internalities and negative externalities. Negative internalities we can call other bad effects internal to the system (person) taking the pleasure, as in say the negative internal effects of drinking too much. Negative externalities we are all familiar with if we read a little about economics.

    I argue that the negative externalities of large tulip fields are themselves large in terms of economic opportunity cost and environmental damage. While we can enjoy a sunset and a natural landscape quietly and we create no significant environmental externalities if we walked to our viewing spot, the growing of vast fields of tulips is a waste of resources and causes significant environmental damage. This matters in a world where sustainablle limits have been breached. Indulging in excess and unwise pleasures in an overshoot world is very dangerous and highly immoral.

    What once appeared to be harmless, middle class pleasures now manifest as world destroying indulgences when performed to an industrial scale by hundreds of millions if not billions of people.

  12. Provocative comments from Steve Keen, a fellow at University College London’s Institute for Strategy, Resilience and Security, in an interview with CNBC recently, including:

    “Fundamentally, the economists have totally misrepresented the science and ignored it where it contradicts their bias that climate change is not a big deal because, in their opinion, capitalism can handle anything.”

    “I think we should throw the economists completely out of this discussion and sit the politicians down with the scientists and say these are the potential outcomes of that much of a change to the biosphere; we are toying with forces far in excess of ones we can actually address.”

  13. Agreeing with James, commodity currencies typically have an inherent value which is then enhanced by their status as a store of value. Whether Ikon is happy about it or not, people like looking at tulips and gold has lots of practical and decorative uses. Fiat money is valuable because governments accept it as payment of tax obligations. If crypto has an inherent value, it arises from its use in illegal transactions such as ransomware and drug trade. I

  14. Some of the cryptos that are gaining some credibility among financial institutions – ethereum and filecoin – do suggest they have a functionality. For example, filecoin states that it offers increased and decentralized computer storage options that can be paid for in “fils”. There is also the suggestion that contracts are unambiguous and self-enforcing – suggestions that are difficult to understand for economists concerned with the incomplete contracts – post-contractual opportunism literature. There are also suggestions that reputable firms are using the blockchain technologies that these firms offer as a kind of superstructure technology.

    Of course, the market action centers on the value of the coins – the “ether” and the “fils”.

    I suspect the whole thing is a con but a little unsure. There seem to me to be plausible stories that don’t quite pan out and a lot of handwaving that seems to target the “get rich quick” believers and enthusiasts.

    The proponents argue that these currencies are trying to replace central banks. That is a problem in itself since central banks are likely to defend their turf – the Chinese and the US have done so. As John mentions, illegal transactions can be securely made using these platforms but the volatility of values must be a major turnoff.

    I am reminded of Warren Buffet’s suggestion not to invest in things you don’t understand. I don’t understand these new technologies so I won’t. But as I learn more I might change my mind.

  15. Again – the basic confusion about money. It’s a debt. Think about it. You hand over commodity or service, get token redeemable wherever said token is recognised (usually area of current residence). Or you get some portion of payer’s credit transferred to you (EFTPOS, credit card, letter of credit etc). The value derives from its recognition.

    Gold is almost universally recognised, so is ultimate token. Could be silver (eg Ming/Manchu China, or India – Keynes early work was on how to transition the rupee from silver to the European gold standard). Excellent tokens – portable, not easily faked, easily valued (unlike, say, cows or bondmaids or marten furs or bushels of rice or barley).

    “Store of value? What is being ‘stored’ is a claim on future earnings – if the earnings decline the value diminishes. As gold is so widely recognised, it’s the ultimate store. Most other stores have narrower recognition.

    Debts need a benchmark against which to evaluate risk. Governments, as the longest-lasting, generally most credit-worthy institutions around, set the benchmark (and the US government, currently, the international benchmark).

    Bitcoin and the rest have value in accord with their recognition and the creditworthiness of the issuer.

  16. J.Q.,

    “Whether Ikon is happy about it or not” is not really the issue. I am saying the planet (biosphere) is not happy about our excess consumption. It is telling us in no uncertain terms. Every unnecessary consumption will need to be pared away. That’s the bottom line. And even you surely understand the opportunity cost issue. Perhaps tulip fields could be used to grow greens to improve Western diets or left to re-wild for nature. How heavy and damaging are the fertilizer costs I wonder?

    The idea that harmless indulgences are still harmless indulgences when indulged in on a grand scale by millions of people is… well an idea which does not hold up. Invoking “utility” as a dogma which supports any and all frivolous wasting of earth’s resources is just that, a dogma. And one without any supportable ethical or scientific basis. It’s simply a metaphysical belief of conventional economics.

  17. Photo of tulip fields near Lisse: Hands up all the Puritans like Iko demanding they be converted to growing healthy cabbages. While we are waiting for the votes to trickle in, I think I’ll trade some of my gold hoard for a sable stole for my young mistress.

  18. Poor old JQ. Now has to be bedroom police and asio too! Only masters & phd’s? Not degrees?

    “Privacy fears over University of Sydney form asking researchers to declare relationships

    “All students studying masters degrees or PhDs will have to detail ‘broadly relevant’ relationships with sexual partners or ex-partners and with overseas organisations

    “All students studying masters degrees or PhDs will have to detail ‘broadly relevant’ relationships with sexual partners or ex-partners and with overseas organisations “…

  19. J.W.,

    That’s a nice jab or jape by you and well illustrates how denial and ridicule can be deployed against otherwise uncomfortable and unanswerable logic. It appears you do not understand the criticality of the world situation with respect to limits to growth, climate change and the general exhaustion of world resources including the depletion of waste sink capacities and bio-services.

    The tulips are only a minor example but like sundries and contributions from the tail in a cricket score these multiple minor contributions do add up to a significant part of the final tally. We need to radically reconsider all our non-essential consumption. It’s sad that you and J.Q., who are otherwise enllightened people, cannot be brought to understand the criticality of stopping every frivolous consumption. Of course, if you cannot understand it how much less can the exploitative elites and benighted masses understand it? Which all illustrates, of course, the hopelessness of humanity’s case. It’s very sad.

  20. I’m in favor of putting a carbon price in place equal to the cost of removing the carbon emitted and sequestering it long term and then letting the cabbage/tulip ratio sort itself out. (And, of course, also making sure the very poor have enough money votes to buy cabbages or tulips if they wish — but that goes without saying if you’re not a sociopath.)

  21. I’m on a high. No not that type. This type. The missing phrase type. But… 10-30 yrs before referendum for inclusion in constitution.

    A “Duty of Care” is THE phrase missing in constitution and legislation. Thanks kids. Whoever you are.

    A duty of care would allow just about every decision to reexamined by placing a Duty of Care filter against any policy. 

    This, and the Dutch “percentage reduction in carbon” against Shell, provide a big, as the article headline states “crack in the wall” toward human and climate justice.

    Look out High Court here they come. A giveaway – the facts were not “contested by the minister”.

    I can’t see, if a molecule of mercury finds it way into a childs lungs, the High Court cannot decline to accept a duty of care – maybe I’m a Pollyanna on this point, yet a duty of care, imo, reverses neoliberalism in time, and makes the culture more caring. ymmv.

    I hope you all agree duty of care is BIG.

    “Australian teenagers’ climate change class action case opens ‘big crack in the wall’, expert says

    “The judge ordered the two parties to make further submissions outlining how the newly determined duty of care impacted the minister’s assessment of the mine.”

    “The lawyers involved say the ruling is a global first.”

    “Despite Justice Mordecai Bromberg agreeing the minister had the duty of care to protect young people from climate change, that climate change would cause catastrophic and “startling” harm to young people, and that the mine would increase the chance of that harm, he dismissed the application for an injunction on technical grounds.”

    “He said while the court did not grant an injunction as a remedy in this case, the door was open to claim damages for the impacts of climate change, now that the duty of care had been established.

    “”I think this has blown open a duty of care for climate change in Australia. It’s blown it open,” he said.

    “Dr McGrath said the case was likely to be appealed all the way to the High Court. 

    “It’s a great decision to defend in an appeal,” he said. “He’s gone through the facts of climate change, made some serious findings of facts.

    “Findings on facts are not normally open to appeal, and in this case most of the facts were not contested by the minister.”

  22. KT2,

    I like Krugman’s essay “The Banality of Democratic Collapse” a lot. However he might, or might not, be surprised to know that the USA is not the only democracy on earth. But I guess it’s like the “World Series”. Every activity undertaken by Americans is not just better than the rest of the world. It IS the world, at least according to Americans. Crucially, they have no idea just how far China has drawn ahead of them,, China is at least doubly as powerful as the USA now on ALL measures except in nuclear weapons. And the funny thing about nuclear weapons is that 400 are as good (or as bad) as 4,000 or 40,000. It makes no difference. An exchange of a “mere” 400 ends the world with nuclear winter. China has at least 400 nuclear weapons and maybe double or treble that. That cancels all of the US advantage. Therefore other forms of power triumph at all levels short of nuclear Armageddon. China is streets ahead of the USA in everything. The USA is crumbling like a sandcastle under a tsunami. We are in for a torrid time. I expect Chinese boots on the ground in Australia by 2040 and maybe even 2030. I’ll be dead before 2040, maybe even by 2030. Not such a bad thing perhaps.

  23. Iko/Malvolio “It’s sad that you and J.Q., who are otherwise enllightened people, cannot be brought to understand the criticality of stopping every frivolous consumption.”

    It’s not that we fail to understand your case. We think it’s wrong. People are driven by fear and love: and love is much the stronger. Effective Green politics must appeal sometimes to pragmatism – renewables are cheaper – and to fears of loss – deaths form air pollution and hurricanes. But for my money. what really works is eros. People “like” there to be polar bears, stripey little fish on coal reefs, whale song, koala bears, kapok trees and redwoods, flights of macaws above the Amazon, giant icebergs, giraffes browsing at dawn; and if possible to experience them in person. These are pleasures, iko, consumption. We need lots more of them.

    One of the weaknesses of reasonable socialism as against communism as the loss of the wild utopian vision of plenty. It’s in Isaiah 25:
    “On this mountain the Lord Almighty will prepare a feast of rich food for all peoples,a banquet of aged wine— the best of meats and the finest of wines. On this mountain he will destroy the shroud that enfolds all peoples, the sheet that covers all nations; he will swallow up death forever.” Verse 60:6 throws in great herds of camels “bearing gold and incense and proclaiming the praise of the Lord”. Good booze and camel song, hat’s the ticket.

  24. James Wimberley,

    You have confirmed for me that you don’t understand. Thanks for that clarification. I was a libertine and wastrel in youth. Since then I have developed a little more sense. Either that or my desires have weakened enough such that they can be restrained.

    “Those who restrain desire do so because theirs is weak enough to be restrained.” – William Blake.

    Either way, it is incumbent upon matured people to provide that weight of caution and restraint necessary to restrain the unbridled passions and idiocies of inexperienced and impulsive youth. However, a key characteristic of many older people under late stage capitalism has been a continuation of irresponsibility and self-indulgence into old age and a blithe carelessness about and dismissal of preserving the living biosphere for all life. I see you fit that pattern to a “T”. It is the most immoral stance possible.

  25. Re Duty of Care, figures below do Not include health costs.  + “Annual productivity losses from heat stress have been estimated at A$616 per employed person,” MJA below. Max productivity @14C, I think. Better pp costs please.

    “Climate change will cost a young Australian up to $245,000 over their lifetime, court case reveals

    “The Federal Court today dismissed a bid by a group of Australian teenagers seeking to prevent federal environment minister Sussan Ley from approving a coalmine extension in New South Wales.

    “While the teens’ request for an injunction was unsuccessful, a number of important developments emerged during the court proceedings. This included new figures on the financial costs of climate change to young Australians over their lifetimes.

    “An independent expert witness put the loss at between A$125,000 and A$245,000 per person. The calculation was a conservative one, and did not include health impacts which were assessed separately.

    “The evidence was accepted by both the federal government’s legal team and the judge. That it was uncontested represents an important shift. No longer are the financial impacts of climate change a vague future loss – they’re now a tangible, quantifiable harm.

    May 27, 2021
     Liam Phelan, Jacquie Svenson, University of Newcastle

    Health. Death – free it seems. Any better specific costs of climate health costs pp please.

    “The MJA–Lancet Countdown on health and climate change: Australian policy inaction threatens lives

    …”Annual productivity losses from heat stress have been estimated at A$616 per employed person,”…

    Med J Aust 2018; 209 (11): 474. || doi: 10.5694/mja18.00789 
    Published online: 29 November 2018

    I cannot understand why the government needs to use private consultants. Yet I am guilty too. I also was chief factotum for just such an expert group during the 1990’s.

    Climate Risk Engines
    We believe that when people can quantify the costs of climate change, it empowers them to plan for resilience, to innovate, and to change the way things are done.
    We strive to build the most powerful and accurate risk engines possible using the best data and technology available.

    …” CRE Paragon [silly name for supercomputer] we can diagnose current and future risks to portfolios exceeding 1 million assets. CRE Paragon was first used to compute the climate and extreme weather risks to the 1.5 million mortgages held by the Commonwealth Bank. CRE Paragon’™s current record is 14.7m properties in a single run.”

    Perhaps JQ may ask them to run a model and dataset.

  26. Brazil tries Norway… ubi and sovereign wealth fund.

    “Socialist Utopia: A City in Brazil Experiments with the Unconditional Basic Income
    . …
    “Business Versus the Surroundings
    “Following the instance set by Norway, town has established a fund designed to proceed pumping revenues into the group as fossil fuels are phased out. “We have now a most of 20 years,” says Quaquá.
    “A COVID Chief
    “The subsequent step was Quaquá’s introduction of an unconditional fundamental revenue for these residing in poverty. Round 1 / 4 of town’s inhabitants – 42,000 individuals – obtain cash from the state. All they have to do is show that they’ve lived in Maricá for at the very least the final three years and don’t earn greater than thrice the minimal wage.

    “The essential revenue isn’t paid out in Brazilian reals, although, however in Mumbuca, a digital forex which solely circulates in Maricá. It’s linked to the actual at a 1:1 alternate charge and represents an try and juice the native economic system. “Individuals used to go to Rio to buy groceries,” says Quaquá. “Now, they spend their cash right here.”

    Paywalled source: socialist-utopia-a-city-in-brazil-experiments-with-the-unconditional-basic-income-a-

  27. Gifts of flowers bring pleasure. There is value in bringing pleasure to others; it is not a frivolous activity.

  28. J-D,

    It is frivolous and environmentally destructive to run large cut flower industries. This is not about one in a thousand persons, on any given day, harmlessly picking a few wildflowers of a non-threatened species growing in abundance locally.

    Bringing frivolous and spurious pleasure to a few other humans at the expense of the entire environment and many more humans is morally reprehensible. The giving of flowers is over-commercialized by far. Most of the desire to receive such gifts is brainwashed into people by the capitalist interests concerned. People are being duped as usual.

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