Sunday, November 29, 2015

Quo Vadis, Labour/Labor?


Due to the backlash (intra-party and in the media) Jeremy Corbyn is confronting, thoughtful people in Britain are wondering about the future of the British Labour Party. Given that the Australian Labor Party shares many similarities with its British counterpart (and it's facing its own problems) perhaps Aussies should pay more attention to those wonderings, which may have something to say to lefties in general.

A quick and dirty summary of the proceedings, as I know of them:
  1. Colin Talbot ("Whither Labour?", Nov. 19) makes a compelling case for an upcoming Labour "civil war" between a centrist "social democratic" Labour Party faction, and a more leftist "reformist socialist" faction (which would include Corbyn); he doesn't, however, provide evidence in support of his claims.
  2. Simon Wren-Lewis ("Is this really social democracy versus socialism?", Nov. 22) finds Talbot's views "depressing" and tries to build a rosier scenario. Was he successful? You be the judge.
  3. Chris Dillow ("Two realities of Labour politics", Nov. 24) is "inclined to agree with Simon", and offers his own scenario. Is it plausible? That is not clear, to me. You tell me.
Me, I can't tell you what's going to happen: my crystal ball is in the repair shop.

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I can tell you something, though. The way Talbot identifies misconceptions plaguing the "reformist socialists" faction of the UK Labour Party applies to much of the Left worldwide:
"New Labour and 'Blairism' was not, as many on Labour's socialist left now want to claim, an historical aberration in which the traditionally socialist Labour party was captured by neo-liberal infected right-wing social democrats. New Labour was merely a tilting back towards traditional social democracy, slightly revised, after the surge in reformist socialist support within Labour of the 80s (which did it so much electoral damage)."
I'd add two things to that. Firstly, that neo-liberalism isn't an "historical aberration" of capitalism, either. Shitty-capitalism (as I sometimes call "neo-liberalism") and New-Deal-capitalism are species within the same "capitalism" genus: what's different is the adjective, not the noun. Chances are the "historical aberration" was New-Deal-capitalism.

And, secondly, neo-liberal social-democrats are only "slightly revised" versions of New-Deal social-democrats. They aren't historical aberrations, either.

Like me mates say: "Both are shit, only from different piles". "Same shit; different piles".


UPDATE:
30/11/2015. The dilemma of what Talbot calls social democrats, represented locally by the Labor Party, is that their sales pitch is that they are neither right, nor left. That worked fairly well for Bill Shorten, while the alternative was Tony Abbott. But since Malcolm Turnbull's coup, that's no longer the case. The result?

Thursday, November 26, 2015

The Paradoxical Kalecki (and part iii)


(From part ii)

The tables below may help in this discussion.

In principle, capitalists hold the frying pan by the handle: they decide (i) the payroll cut magnitude (D) and (ii), from what they get, capitalists decide how much to consume and invest (without loss of generality, in the examples following they consume as much as they invest).


Tuesday, November 24, 2015

The Paradoxical Kalecki (part ii)


(From part i)

For convenience, let's repeat the argument presented last, adding some emphasis:
"Answering the question 'Where do profits come from?' requires a macroeconomic perspective. Profits are produced by specific macroeconomic flows of funds. Unfortunately, the macro perspective necessary to investigate these flows can be elusive because of a logical trap: the tendency to assume wrongly that circumstances that apply to the familiar case of the single firm also apply to the entire business sector.
"To illustrate the problem of applying a microeconomic perspective to a macro situation, consider the following. As every entrepreneur knows, employee costs are a major influence on a firm's profits. Cutting payroll expenses means a more robust bottom line. Accordingly, it is commonly believed that when firms throughout the economy hold down wages, they improve aggregate profits. However, for the whole business sector, cutting employee compensation reduces revenue as well as expenses. Less worker pay means less personal income and, therefore, less personal spending on the goods and services sold by businesses. Therefore, cutting payrolls will not directly increase corporate profits".
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Saturday, November 21, 2015

The Paradoxical Kalecki (part i)


(Motivated by a side discussion at Peter Cooper's)

Following Keynes and the paradox of thrift he popularised, Keynesian economists have developed a taste for paradoxes. In most cases I'm sure there is something to those paradoxes; in a few cases, they may be meaningless, but otherwise harmless.

In one case, however, this reliance on paradoxes seems detrimental. Paradoxically it involves misinterpreting Polish economist MichaƂ Kalecki's price equation:

(1)          P = Cp + I.

Thursday, November 19, 2015

Bernie Sanders and Social Democracy?


This film tells the story of the campaign to turn a normal family, decent Americans, your next door neighbours -- maybe even democratic socialists -- into true-blue social democrats.

They were travelling to San Diego, in family holidays. On their way, they met the social democratic family (played by the PASOK crew, Tony Blair, Bill Clinton, and Paul Keating).



Now, is your turn, Bernie. Join the family. You can't go wrong.

Tuesday, November 17, 2015

3D-Printed Rocket in Canberra.


Year 11 students from Gungahlin College -- a public school in Canberra -- designed, built (using a 3D printer), and fired a test rocket (the ABC Online page includes sound recording and photos) as part of their project to launch a high-altitude balloon, next year.

And it was a fairly sophisticated gadget, too, including (apart from their own engine): "accelerometer, magnetometer, altimeter and GPS, as well as temperature and humidity sensors". The use of a 3D printer, say the students, adds flexibility to the project: it's a matter of hours to design and get a new component, if required.

The launch -- yesterday -- was generally successful, apart from a glitch in the the memory card set to record the flight data. Apparently, the electronic components, coming from different manufacturers, are difficult to integrate.

The kids are going to repeat the launch next week. Congratulations to the students and their teachers and good luck to them!

Sunday, November 15, 2015

Keynes' Gesellist Infection.


William A. Darity (Samuel DuBois Cook Professor of Public Policy, Sanford School of Public Policy, Duke University) argues "that in substantial portions of The General Theory, J.M. Keynes was a mere Gesellist, particularly but not uniquely, in his expressions of political philosophy vis-a-vis the relationship between state and economy".

Keynes' debt to the German Silvio Gesell (one of his beloved monetary "cranks" and "heretics") is no secret, although the technical details are often forgotten. In a nutshell, Keynes adopted Gesell's idea of precautionary money demand as explanation for economic slumps. As financial assets are not produced by labour, this demand invalidates Say's Law.

Friday, November 13, 2015

Cooper on Marx and MMT.


Peter Cooper, a very promising Marxist/MMT Australian economist, has started a series of articles on the relationship between Marxist economics and MMT.

Cooper himself has written about Marx and MMT before and builds upon insights obtained from both pre-eminent Marxist scholars (he mentions Duncan Folley, co-winner -- with Lance Taylor -- of this year's Leontief Prize) and leading MMT exponents William Mitchell, L. Randall Wray, and Mathew Forstater (all of which have been mentioned before in this blog).

For those of us of some age, the Internet has been a bit of a mixed blessing. For one, it has delivered valuable content; for another, whatever good present in the Internet, it's mixed with all sorts of rubbish and the general public is left to separate the wheat from the chaff.

Judging by his first post, Cooper's series is wheat of the best quality and fulfills one's hopes and expectations of what the Internet could be. I cannot urge you enough to read and learn from him.

To Peter, my congratulations and thanks for this magnificent effort.

Wednesday, November 11, 2015

Cogito Ergo Sum.


Two persons are credited with the quotes below. One is very well-known among economists -- amateurs and professionals, alike -- the other is better-known among philosophers and logicians.

Person A is quoted variously as saying:
"I don't need algebra, I can think."
or, in an alternative version:
"I never learned math, so I had to think."
Person B:
"Few persons care to study logic, because everybody conceives himself to be proficient enough in the art of reasoning already. But I observe that this satisfaction is limited to one's own ratiocination, and does not extend to that of other men."
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Sunday, November 8, 2015

A Favourite of Mine.

Doppler effect of water flow around a swan. [A]

Let's hypothesise.

Suppose I tell you "Joe is a man". We can -- hopefully readers will agree -- abbreviate that sentence: M. (Think of stenography.)

Now, we may say: if Joe is a man, then he must have testicles and penis. Yes? This longer sentence is formed by "Joe is a man" and "Joe has testes and willy", joined by a connective ("then").


Friday, November 6, 2015

Varoufakis: Talking the Talk.



Yanis Varoufakis certainly talks the talk. Above (h/t Charlie Tan) is him "in conversation with Aaron Bastani".

Around 6:00 minutes into the interview, Varoufakis says:
"One of my convictions is that the Left lost the battle in the early part of the 20th century by abandoning Marx's commitment to the concept of emancipation and liberty."
Not bad. Not bad at all. [*]

Wednesday, November 4, 2015

Be an Astronaut!



NASA is searching for the next generation of astronauts (from ABC News online, and NASA)!

Requirements:
  • US citizen.
  • "bachelor's degree in a science, technology, engineering or mathematics field" (minimum).
  • "be followed by at least three years of related, progressively responsible experience".
  • "pass a long-duration spaceflight physical test".
  • "Distant visual acuity: 20/20 or better uncorrected, correctable to 20/20; Blood pressure: 140/90 measured in a sitting position; Height between 58.5 [148.59 cm] and 76 inches [193.04 cm]."
Really cool. I envy you boys and girls. Good luck!

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Unfortunately, Aussie kids won't be running in that space race.

But, never mind, young Australians: You can always have a life full of meaning, achievement, adventure, and excitement on Earth. You study economics/law, work for free as an intern for a free-market "non-partisan" (wink, wink) "think" tank; next, you become an apparatchik for a "conservative, right-of-centre, libertarian" party.

After that, you go into Parliament, to "squeeze" parliamentary allowances and to suck up "network" like crazy with your future business partners. You may even win a legal coup d'etat leadership challenge!

Worse comes to worse, you can always join the Labor Party.

Wouldn't that make you feel proud?

Tuesday, November 3, 2015

Corbin vs Pommy Bullies.


Personally, I don't know a great deal about Jeremy Corbin.

But I do know something relating to him: I don't like bullies. And I especially dislike cowardly pommy bullies. I mean, when all that arrogant, pale-faced mediocrity manages to find the balls to have a go against a single person -- as they are doing against Corbin -- it's a sure sign there must be something valuable about him/her.