Club Troppo

Ever since I read his marvellous The Truth about Markets I’ve been a fan of John Kay – an economist who doesn’t like to get too far away from reality. He’s also not a zealot for any particular view of the world, except that pathetic kind of vagueness and pluralism to which I aspire myself. Perhaps he might even be a Conservative, Liberal Social Democrat after my own heart. In any event, this post is just a marker to suggest that you do yourself a favour as Molly Meldrum used to invoke us to do and get a hold of his recent paper on “The Rationale of the Market Economy” It’s subtitled ‘A European Perspective’ but it’s not entirely clear why since his focus is universal (though judging from some of his columns, Kay thinks that the market life the French have built for themselves is better than the market life the Americans have built for themselves (pause for our red meat eaters to scoff and tell us that that’s just fine while he sips on his champaign and latte.)

Anyway, the key theme of the paper is the importance of pluralism – in civil and market society. Couldn’t agree more.

This passage puts the argument and may get you linking through to the article itself – note it looks like it’s behind a paywall but if you persevere you’ll find it’s just a wailing wall – you just give them a few details and they let you download the document and ask you to lobby your local library to take their journal.

Greed must be constrained, but it is inadequate to describe that constraint simply as the rule of law. The property rights that are critical to the rule of law are not given by nature, but are socially constructed.4 Information asymmetry is endemic in modern economies with complex products, and that asymmetry is handled mainly through the mechanisms of trust relationships and reputation. Market economies operate with far more coordination and cooperation than the model of unrestricted greed allows. The simplistic account of human motivation based on self interest comprehensively fails to recognise the real complexities of human behaviour. (Continued)

The global warming debate has morphed into Mondo Bizzaro.  Rudd is capable of mounting a succinct and persuasive explanation of his emissions trading scheme but chooses not to do so,  preferring to shift the electoral focus to subjects the pollsters tell him are more unequivocally propitious.

Tony Abbott, who thinks man-made global warming is “crap”, nevertheless promises to spend billions of taxpayers’ dollars in dealing with it, even though his predecessor rightly labels the Mad Monk’s policy as  “a recipe for fiscal recklessness on a grand scale” that would increase taxes and fail to reduce emissions.  Of course, the cognoscenti know that Abbott’s policy is just a minimally plausible figleaf he has no intention of ever implementing, but which allows him the elbow room to orchestrate a rerun of Labor’s 1998 GST scare campaign by labelling the ETS a “great big new tax”.

Only Turnbull bothers to present a considered, analytical case for the ETS, but no-one listens because he’s yesterday’s man and neither policy nor principle nor even intelligent discussion are of the slightest interest to the reptiles of Australia’s political media.  Politics is just a footy game for nerds.

It currently seems highly unlikely that an ETS or any other effective policy to combat man-made global warming will be implemented in the near to medium term, either in Australia or elsewhere, something Paul Frijters has presciently been saying here at Troppo for a rather long time.  No wonder they voted him Australia’s best young economist.  Maybe the time really has come to start seriously canvassing geo-engineering solutions to global warming, as Paul has previously canvassed here and here.  I’ll come back to that point in a moment.

(Continued)

While we’re waiting for Ken’s dissertation on the ethics of forcing minors to watch the Prime Minister’s appearance on qanda, here are a few comments on the program itself. [Update: more from Mark Bahnisch]

Kevin Rudd and Tony Jones looked like twins, both prematurely white, bespectacled and beaming, standing on either side of the Speaker’s chair in Old Parliament House. Coalition partisans would have been enraged to see the two of them, the Labor PM and the government-salaried Labor propagandist, using public money and airtime to propagandise to an assembly of impressionable young minds.

Rudd obviously enjoyed the encounter. You couldn’t say he had the youngsters eating of the palm of his hand, but the rapport was good. I don’t know how the audience was selected, but see no reason why it wouldn’t have been a representative cross-section of 15-25 year olds, in terms of political background. Rudd clearly sees himself as their kind of guy, and not without justification.

Not entirely, anyway. (Continued)

Remember me?  That grumpy old bloke who once obsessively spewed forth half-baked opinions here at Troppo?  After being AWOL for some time a comeback of sorts seems imminent.  I’m experiencing fitful urges to post, usually on very silly topics like whether Jen may have committed reportable child abuse by forcing young Jessica to watch KRudd being quizzed by members of James Farrell’s dumb generation on Q & A.

Pending one of these strange mental formations actually crystallising into a semi-coherent blog post, I’m warming up by making a major CT housekeeping announcement.  After deep introspection between Nicholas Gruen and myself, we’ve decided to abolish (on a trial basis) the requirement for readers to register before making comment box contributions.  It’s a decision we might come to regret, but our subjective impression is that the incidence of truly destructive trollery has been significantly reduced across the ozblogosphere in recent times.  It may be that the loss of spontaneity and freedom that inevitably flow from forcing readers to register before they can participate in discussion is a price we no longer need pay.  Anyway, time will tell …

It is relatively easy for economists to debate efficiency issues e.g. when we discuss privatisation.

But when we are discussing a host of particular economic issues – such as the distribution effects of labour market deregulation, or the role of health care, or the role of investment in education, or why a government stimulus is needed (when interest rates are up against the zero bound) one problem keeps coming up. Has economics now become so mathematized and divorced from moral philosophy that it is no longer concerned with trade-offs between equality and efficiency? (Something Greg Mankiw recently reminded of this).

Does it now mean that, within the Paretian framework, there is no reason why a person B does not need to care about the effect of government public policy on the welfare of another person B so long as person B can theoretically be made materially better off?

This leaves us with an economics literature that few people can truly understand, either in its content or its relevance the important moral and economic arguments that confront us today?

Read the comments by Maxine Udall.

The February edition of The Monthly is out, including Robert Manne’s eagerly-awaited ‘Comment’ on Windschuttle.

Windschuttle attacked Manne in January’s Quadrant, saying that he should stand down from his position at La Trobe, then on Monday went on ABC radio’s Counterpoint to summarise the general case against the stolen generations ‘myth’ that forms the thesis of his Volume III. The debate is a bit hard to follow, because Manne has responded to Windschuttle’s print arguments on radio, and to his radio arguments in print. That is, Manne replied to Windschuttle’s personal attack on Late Night Live, and, contrary to Phillip Adams’ advice, it turns out that the piece in The Monthly adds nothing to that — it’s just a general critique of Windschuttle’s book. (Continued)

I have been arguing here that America is different to other countries, and in particular that the right wing party (one can hardly call it conservative) is different. Here’s some hard evidence. It is as Markos Moulitsas says, tragic. These are the attitudes of self identified Republicans.

Serving it up to the hyperconnected generation

I read The Dumbest Generation over Christmas, though it came out in 2008. It’s a very satisfying polemic, as well as thoroughly researched — to the extent that I’m competent to judge — and its author Mark Bauerlein is a cut above the average as a stylist.

The title refers to American teenagers and young adults up to about 30, and the book is as provocative as it suggests. Bauerlein presents four theses:

1. The generation in question is indeed dumb, in the sense that they know very little about history, politics, current affairs and literature. This conclusion is based not on anecdotal evidence, but on a mass of academic research that Bauerlein painstakingly surveys. Furthermore, the youth of today are unabashedly ignorant, scornful of books, and bemused that previous generations endured the tedium of reading and absorbing such patently boring and irrelevant material.

2. The source of the trouble is, of course, the amount of time youth devote to electronic interaction, or engrossed in cyberspace amusements. It isn’t just that these activities absorb time that would be better spent on reading books; they foster a focus on ephemeral peer preoccupations, an impatient preference for instant gratification, and a narcissistic fascination with adolescent culture. All this serves to stunt vocabulary, conceptual growth and intellectual stamina, while shutting out adult influences and other sources of enduring wisdom. There is no shortage of sage social commentators ready to respond with ‘Ah, but our youth are developing new and wonderful kinds of intelligence and literacy — creative, empowered, dynamic [etc., etc.]‘. However, contrary to the impression given by Michael Duffy, who doesn’t seem to have penetrated very far into the book, Bauerlein is perfectly aware of these arguments, and takes on a phalanx of apologists, harpooning their inflated claims one after the other. (Continued)

William Hardy Wilson is a fairly well regarded Australian architect of the 20th century and is such usually afforded a few paragraphs in biographical dictionaries and encyclopaedias. These will mention in passing a few well regarded buildings and pay brief mention to an unrealised effort late in his career to create a new architecture combining European and Asian aesthetics.

This does us a great disservice! Hardy Wilson’s later work was an attempt in his own mind to do no less than save civilisation. His own historical theory of everything, which dictated this work, was amazingly bizarre and for this alone is worth recounting. But he also held strong visions of a future Eurasian Australia. The parallels and contrasts with our own multicultural society are striking in both superficial and deeper ways. (Continued)