New on the website

John Quiggin2 Comments

A piece I wrote for the Fin on the ‘generation game’ several years back, but omitted to post on my website is finally online. Here’s a couple of paras.

One of the standard ploys in journalism, marketing and political commentary is the generation game. The basic idea is to label a generation ‘X’ or ‘Y’, then dissect its attitudes, culture, and relationship with other generations. The most famous generation, of course, is that of the Baby Boomers, born between the end of World War II and the early 1960s, and their most enduring contribution to the generation gap is the ‘Generation Gap’ between children and their parents.

At first sight, discussion of this kind can carry with it an air of fresh insight, but most of it stales rapidly. Much of what passes for discussion about the merits or otherwise of particular generations is little more than a repetition of unchanging formulas about different age groups ö the moral degeneration of the young, the rigidity and hypocrisy of the old, and so on.

Update 30/8/03 As if to prove my point, today’s Fin (subscription required) runs a particularly silly generation game, with an even sillier lead on the front page. After recycling the the usual cliched half-truths, the article turns to a complete furphy as its main theme. Boomers are blamed for grabbing the old age pension and leaving nothing for the young. In reality, boomers paid taxes during the 1970s and 1980s to finance a universal non-means-tested pension, with access for women at 60 and men at 65. Even when the pension was means-tested, tax concessions for superannuation and easy access to lump sums gave lots of early retirees the chance to double dip.

Now pensions are tested on both income and assets, the women’s age is being raised to 65 (just in time for the first boomers) and there’s talk of pushing the pension age up to 67 after that. Concessions for superannuation, while still generous compared to most other investments, have been scaled back significantly, as has the generosity of employer contributions. On any reasonable assessment, it’s the Depression kids who have done well on this score and the boomers who have paid for schemes whose benefits they will never enjoy.

Walmart and productivity, Round 2

John Quiggin2 Comments

Brad de Long slams as ‘fast food journalism’ a piece in the Financial Times by John Kay, on the topic of US and European retail productivity. His main complaint is that Kay implies that productivity statistics for retailing take no account of differences in the quality of service between friendly local retail markets and gigantic US-style megamarts. As Brad correctly says, the Bureau of Labor Statistics in the US takes a lot of trouble over this kind of thing.

Brad goes on to say, or at least imply, that Kay’s preference for the friendly local market over the Carrefour supermarket is snobbish and takes no account of the benefits to low-income workers from low-margin stores like WalMart, which are denied them by European regulation. This seems a bit unfair – as I read Kay, he’s saying that the regulations are superfluous and that the local markets can survive the competition.

Turning to the more general issue of productivity comparisons, Brad’s post raises quite a few points. First, while the BLS no doubt does its best, it is still true that retail productivity is hard to measure, and that claims of large gains must be taken with a grain of salt. For example, in principle, the BLS should take account of the increased travel time required for shoppers to go to edge-of-town Walmarts, but I don’t think they do so.

Second, as I pointed out in another recent post on this topic, the quality adjustments undertaken by the BLS do not take account, even in principle, of the negative externalities arising from people driving long distances, externalities that include traffic congestion, the loss of green space and thousands of extra road deaths every year.

Third, the BLS generally does a lot more of this ‘hedonic adjustment’ than do European statistical agencies (or, as far as I can tell, the Australian Bureau of Statistics). I think the BLS estimates are probably more accurate on balance. Regardless of which estimates are better, the inconsistency means that comparisons of US and European GDP and productivity growth are systematically biased in favor of the US, by about 0.5 percentage points per year.

Finally, the really big question is whether the differences in US and European consumption patterns, working hours and so on are driven by different tastes, different relative prices and regulatory constraints or some complex combination of the two. I’m still planning a big post on this question Real Soon Now.

Academic freedom

John Quiggin11 Comments

I’ve finally got around to resuming the debate with Andrew Norton over my claim that neoliberals (or, if you prefer, contemporary classical liberals) are not particularly supportive of freedom of speech. Norton argues that the absence of discussion of freedom of speech reflects the fact that, with minor exceptions, freedom of speech is not threatened.

But at least one form of freedom of speech, academic freedom, is coming under sustained attack. Academics are regularly being subject to attacks from university managers either for criticising the commercial operations of the university or for political speech. The most notable recent example was the Steele case, but it is by no means unique.

The Centre for Independent Studies has been active participant in this debate, and has presented the viewpoints of university managers concerned to manage or suppress academic freedom. The most striking instance is a piece by Steven & Gregory Schwartz (Steven Schwartz was formerly vice-chancellor of Murdoch university. The breakout quotes chosen by the CIS in republishing the piece give the basic line

the laissez-faire approach to academic freedom is neither logical nor practical

like freedom of speech, academic freedom has its limits

Lauchlan Chipman is more reasonable, but still seeks to invent precedents for the restrictions on academic speech managers are now trying to impose.

Australian universities have always insisted that academics have no right to comment publicly, except as ordinary citizens, on any matters outside their area of academic expertise. Whether written or unwritten, such policies have always denied academics the right to use their university rank, occupational position, or address in external communications on other than their area of academic expertise

I can say from personal experience that this is untrue. Precisely this issue was vigorously debated when I was at James Cook University, where the management was trying to suppress an environmental law lecturer who was criticising an influential local property magnate. You can read a bit about the case here (search for David Haigh). At the time, the Academic Board had sufficient power to resist this move, but as Chipman indicates, it’s a standard item in the managerialist log of claims. And of course it’s managers who decide what is relevant.

The concept of academic freedom raises a lot of complex issues, including the general ‘whistleblower’ problem, the relative weight placed on freedom of contract and freedom of speech and the nature of universities. But it’s easy to see who is in favour of free speech and who is against it.

Asian values

John Quiggin4 Comments

Absurd comparisons between Pauline Hanson and Nelson Mandela have not helped to advance the debate. But a more useful comparison might be made with legal harassment of opposition politicians in countries like Singapore. It is not illegal to oppose the government there, but somehow opposition leaders seem to run afoul of the law a lot, notably with defamation actions. In particular there are strict regulations on the constitutions and financial affairs of political parties, which cause big problems for opposition parties.

Australia is not the same as Singapore. Nevertheless, I imagine the Hanson case will be quoted prominently in reply next time anyone from Australia criticises restrictions on the political freedom of our Asian neighbours.

Reality bites

John Quiggin8 Comments

This reported statement from Paul Bremer, acknowledging that reconstruction in Iraq will cost tens of billions of dollars, and that oil revenue will come nowhere near paying for this is a welcome acknowledgement of reality. But there is still no sign that the US Administration as a whole has accepted the need to spend lots more money. And even Bremer is still sticking to the party line that other countries (read Old Europe) can be expected to give buckets of money to Uncle Sam while being treated as pariahs or interlopers.

Meanwhile Howard is steering clear of the whole thing, offering no more than the handful of troops still left in Iraq and no serious money. I’m in two minds about this. Certainly, we have plenty of problems closer to home, and the benefit-cost ratio is probably higher in the Solomons than in Iraq. On the other hand, we invaded Iraq, smashed its economy to bits, and are now leaving the unfortunate Iraqis to pick up the pieces.

Abbott v Hanson

John Quiggin23 Comments

Our legal system behaves in strange ways. Pauline Hanson was jailed for three years for a highly technical breach of the electoral registration rules. But apparently it’s OK for one political party to foment and fund legal disputes within another.

Update According to Ken Parish, Abbott may indeed be in legal difficulty over this.

A belated farewell

John Quiggin1 Comment

Blogging is hard work – it’s particularly hard if you try to keep up with what other bloggers have been doing on a regular basis. I’ve let that slide a bit recently, and have been busy enough just responding to comments and pings. As a result I only just read this signoff post from Carita Kazakoff’s Manas blog. Carita didn’t post all that often (probably why she’s managed to kick the habit), but she brought a refreshingly different perspective to a lot of the issues she covered, particularly East Timor/Timor Leste.
Her post gives a hint that she may return next year, which would be very welcome.