Data and anecdotes

John Quiggin18 Comments

Among the outcomes produced by a market economy, real wages are arguably the most important single variable for most people. With inflation rising around the world, and sensitive prices like those of food and petroleum going up a lot, most people’s living standards depend mainly on whether wages grow faster than prices. I got a couple of pieces of info on this today, which illustrate the difference between data and anecdote.

In my morning email, the US Bureau of Labor Statistics (pdf file) advised that the US employment cost index (hourly wages + benefits) rose by 3.5 per cent last year, less than the inflation rate of about 4 per cent*. This continues a trend of declining real wages since 2003.

This afternoon, I looked at the NY Times to see a story about stagnant real wages in Europe, which began with a lengthy voxpop about a couple who had bought a breadmaker because baguettes were too dear, and continued in much the same vein. Deep within the article was the information that eurozone prices have risen by 22.5 per cent since 1999. But despite various claims about the declining purchasing power of wages, there is not a single piece of statistical evidence on wages anywhere in the story. Instead, we got a lengthy and inevitably inconclusive discussion of what constitutes the “middle class.

A quick visit to Eurostat reveals that Eurozone wages have risen about 30 per cent since 2000. German wages have increased by about 20 per cent, so the article’s claims of stagnation appear to be about right for Germany, but not for the EU as a whole. Of course, to do things properly you’d want to consider the impact of food prices on low-income households. But given the focus on the middle class, it seems reasonable to suppose that the price index measures the standard of living for the average middle class household reasonably well.

It seems sad that the NY Times has to cover issues like this by anecdote, but I guess it gets them a lot more readers than the BLS email statistics series.

* The US Fed prefers to focus on the “core” inflation rate, excluding food and energy prices, a use of “core” even more impressive than John Howard’s. so it says the rate is about 2 per cent. And the reforms to the CPI introduced by the Boskin Commission in the 1990s reduced the measured inflation rate by a percentage point or so, meaning that the current rate is comparable to 5 per cent inflation on the measures used in the 1970s and 1980s.

Substance and symbols

John Quiggin17 Comments

I don’t have much comment on the government’s measures to remove a wide variety of discrimination against same-sex couples, except to observe that this ought to put an end to the canard that the Rudd government is “all about symbolism”. This is an issue where Howard tried hard to push the symbolism of gay marriage as a wedge, and deservedly failed.

Wong on water

John Quiggin20 Comments

I’ve been too busy to do a proper assessment of the water policy announcement made on Tuesday by Penny Wong. The good news is that the government is finally getting moving on buying back water from irrigators, on a “willing seller” basis. That’s a significant change from the previous government, who clearly viewed buybacks as a last resort. However, as the ACF has pointed out, the previous plan did identify $3 billion for this purpose. It remains to be seen whether the government will take the shift further by applying more stringent cost benefit analysis to the engineering works favoured under the previous plan.

So, as with most things under the new government, a good start, but we’ll have to wait for more.

When good spamcatchers go bad

John Quiggin4 Comments

Akismet, my spam filter, is going a bit wild at present, after a long period when it worked fairly reliably. I’ve rescued six comments from the spam queue just now, but I may well have missed some.

As noted in a previous post, I’ve also become much harder on trolls, so there’s more going to moderation. If you’ve been banned and want to be readmitted on a promise of better behavior in future, you can write to me and ask. If you’ve been banned and you think your previous postings were just fine, post them somewhere else – I’m not interested.

Videoseminar today at ANU

John Quiggin16 Comments

Sorry again for late notice, but I’ll be presenting a video seminar 1pm today at ANU on intergenerational equity. For details contact Ralf Steinhauser on ph: 61 2 6125 4667.

Report: This was a bit of a bleeding edge experience, though it worked OK in the end. The big problem was presenting slides at the same time as video of me talking. ANU was expecting a hardware solution (dual video) while UQ was expecting a software solution (NetMeeting or Bridgit). Fortunately, I had sent the presentation ahead of time, so someone at the ANU end was able to run it for me. But I’ll have to develop a standard procedure for this.

I’ve attached the presentation (in PDF format)here

Read More »

One less stupid idea to worry about

John Quiggin23 Comments

The Queensland government has abandoned the idea of piping water from the Burdekin to the Southeast corner. A $350 000 study by GHD concluded that the proposal would be ruinously (as in $14 billion) expensive. I could have told them that for free, just by looking at the studies on Colin’s canal. Still, the Beatty government originally announced plans to spend $3 million on a feasibility study, so the GHD study is a bargain. And the big news is that the proposal is dead, once and for all.

War crimes trials?

John Quiggin132 Comments

It’s not that surprising to read that former Malaysian PM Mahathir Mohamad has called for an international tribunal to try Western leaders with war crimes over the war in Iraq, nominating Bush, Blair and Howard in particular. Mahathir is well-known as a provocateur, with a fondness for extreme statements, which have included anti-Semitic attacks on George Soros and others. So it’s unlikely that anyone will pay much attention to him.

Still, his views on Iraq as a war crime are widely shared. It scarcely seems beyond the bounds of possibility that someone like Baltasar Garzon might find a legal way to file criminal charges (Wikipedia says he’s already threatened a civil suit.

Such charges would have enough factual and legal support to make the outcome unpredictable if they ever came before a tribunal. Apart from the general question of the legality of the war itself, the US in particular has openly denied the applicability of the Geneva Conventions and has engaged in many actions (torture of prisoners, bombing of occupied civilian areas, reprisal attacks of various kinds) that at least arguably violate the Conventions.

On the other hand, the prospect of Bush, or any US official, for that matter, actually standing trial, let alone being convicted or punished, seems unthinkable. The only consistent inference that I can draw from this is that, if charges are ever laid in any jurisdiction, the governments concerned will find a way to abort the process without allowing the substantive issues to come before a court. Since most of the doctrines that might be used to achieve such an outcome (sovereign immunity, non-interference in internal affairs and so on) have already been repudiated, it seems as if such an outcome could only be justified in terms of a bald claim of “reasons of state”.

Are there any legal experts who can help me out here? I have two main questions:

1. Where if at all, might charges be brought against Bush and others?
2. How would the hearing of these charges be prevented?

We shall remember them (reposted from 2005)

John Quiggin39 Comments

On Anzac Day, there are two important things to remember

* Thousands of brave men died at Gallipoli and in the Great War and we should always honour their memory

* The Gallipoli campaign was a bloody and pointless diversionary attack in a bloody and pointless war. Millions were killed over trivial causes that were utterly irrelevant by the time the war ended. The 1914-8 War only paved the way for the even greater horrors of Nazism and Stalinism. Nothing good came of it.

From what I’ve seen of the last surviving Diggers they were fully aware of both of these things. At one time, it seemed possible that, as the generation who fought in the war passed on, we would forget the first of them. Now the danger is that we will forget the second. We should judge as harshly as possible the political and religious leaders who drove millions, mostly young men, to their deaths, and honour the handful who stood out against the War, including Bertrand Russell and Pope Benedict XV.