Quiggin vs Williamson: The home game

John Quiggin104 Comments

A while ago, my stoush with US economist Stephen Williamson over his attack on Zombie Economics (in some blog posts and what was presented as a review, for the Journal of Economic Literature) attracted a fair bit of attention around the Intertubes. Now Williamson’s longer review, to which I briefly responded here, has turned up in Agenda, published by the ANU School of Economics.

There’s a history here. Way back before blogging was born, the current editor of Agenda, William Coleman co-authored a book, Exasperating Calculators, published by Keith Windschuttle’s MacLeay Press in which I got a brief but critical mention, along with lots of others. I wrote a fairly scathing review (over the fold, also with a review of a book by Wolfgang Kasper) and I think there may have been one or two more rounds.

So, I wasn’t all that surprised to see Williamson’s piece appearing in Agenda, although I do feel (given Williamson’s putdowns of me as an Aussie yokel, and member of the “farm team”) that they could have tried for an Australian, instead of an import on this occasion. I don’t have time for a full-length response at the moment, except to say that I don’t think Williamson really engages with my argument at any point.

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Euro-Kremlinology

John Quiggin3 Comments

Understanding developments in the European crisis has become rather like Kremlinology, trying to figure out the meaning of subtle changes in wording, and rearrangements of the Politburo on the podium for May Day parades. In particular, Mario Draghi of the ECB goes back and forth, sometimes suggesting that the ECB will do what nearly everyone else can see is minimally necessary to the survival of the euro (namely, print lots of them, and use some to buy EU government debt, as was done by the Fed and the Bank of England). At other times, though, it’s as if Jean-Claude Trichet is doing a ventriloquist act.

In one respect, todays EU agreement was anything but subtle. The fact that the Eurozone countries and those aspiring to join them were prepared to go ahead without the UK (and a few others) suggests that they have something serious in mind. But what – the announcement is pretty much a restatement of the Growth and Stability pact, and under present circumstances, the deficit targets can only be seen as aspirational.

Applying one of the approaches that used to be standard in Kremlinology (not necessarily a reliable one, then or now) I’m going to assume that the EU leaders are acting with some sort of coherent goal in mind and work from there. In particular, I’m going to assume that everyone who matters now recognizes the need for a big monetary expansion and the use of newly created money to resolve, or at least stabilize, the debt crisis.Read More »

Sausages, legislation and the Draft Basin Plan

John Quiggin75 Comments

Bismarck is supposed to have said that for the sake of digestion and peace of mind, one should never watch the process by which either sausages or legislation is made. Certainly that’s true of the Draft Basin Plan released by the Murray Darling Basin Authority a few days ago.

What was supposed to be an evidence-based analysis aimed at determining sustainable outcomes was derailed by poor communications and legalistic processes. The botched release of the Guide to the plan last year produced an outpouring of fear and outrage among irrigators who were repeatedly told that their water allocations would be “cut”. The Government rapidly abandoned the process and engaged in the political bargaining that has produced a new plan, of which the most prominent feature is a proposed environmental water allocation of 2750 gigalitres (or perhaps less) well below the 3000 to 4000 GL suggested in the Guide as the minimum necessary for a sustainable outcome.

The process by which this outcome was reached wasn’t pretty and, unsurprisingly, no one is happy about it (I had my dummy-spit a fair while ago). But, considered as a political compromise, the outcome isn’t all that bad. If the 2750 GL total holds, the environmental allocation will be around 25 per cent of the median flow – that’s comparable to what the Snowy got in the deal brokered by Craig Ingram in 2009. It’s a lot better than seemed possible even seven years ago, when politicians could barely agree on measures to return 500 GL, and a suggestion of 1500 was ruled out of court before it was even studied.

Thanks to the Water for the Future program, something like 1700 GL of average flow has already been (re)purchased from irrigators who have been happy to sell. If the government pursues this path, they could declare victory in a few years time and abandon the costly boondoggles involved in subsidising supposedly water-saving engineering projects.

Please don’t blow this chance

John Quiggin105 Comments

The desertion of Liberal (or LNP?) member Peter Slipper to take up the Speakership offers the Labor government a great opportunity, but also the temptation to mess things up disastrously. The opportunity is to see out a full Parliamentary term, long enough to put the carbon tax and MRRT in place in a way that the Opposition will either have to accept them, or announce a credible plan to replace them – something that is clearly beyond the capacity of its current leader.

The temptation is that the corrupt hacks who infest the ALP machine will use the extra vote to renege on the promise to Andrew Wilkie to tackle the scourge of poker machine gambling through precommitment. A large section of the ALP has been tied to the hotel and club industry since time immemorial and have obstructed any reform that would challenge the interests of this industry.

Even disregarding the issue of principle, it would be really stupid to break the deal with Wilkie. The government’s only chance is to survive past the point when the scare campaign about the carbon tax and MRRT will be shown up for what it is. If Wilkie abandons them and one ALP member has to leave Parliament for some reason, the government will fall. In that case, electoral support or opposition from the poker machine lobby will make no difference.

Still time to help East Africa

John Quiggin5 Comments

We’ve raised over $4000 for the East Africa appeal, more than $8000 after the Australian government’s matching contribution. That’s enough to make a real difference to the lives of hundreds of people living in the most desperate conditions. But there’s still time to reach the appeal target of $5000. I started things off with a contribution and now I’ve done the half marathon as promised, finishing in a time of 1:57:16, more than three minutes below my previous best time. Surely that’s worth the effort of clicking the link and putting in whatever you can afford for this truly worthy cause.

I haven’t used any gimmicks for this appeal so far, but if we reach $5000 I’ll buy and post the after-race photo, which should provide much innocent amusement for readers, what with my special race gear and generally depleted condition.

Update The $5000 target has been reached! Thanks so much to my readers who have, as usual, given generously to help others.

I’m not going to close off the appeal for another couple of days. If you haven’t given already, put in whatever you can afford.

I haven’t heard from the race photographers yet, but presumably they will be in touch, so that I can post the evidence.

Finally, I have just learned that two runners died during the event, the first time this has happened in the 13 years it has been run. My condolences go to their families. Remember, if you are thinking of taking up any strenuous sport ,to build up slowly, have regular medical checks and stay within your limits on race day.End update