Club Troppo

Some Troppodillians may be familiar with the wonderful Melbourne Film Blog. A few weeks ago I decided that it was just ridiculous that I didn’t consult it more. I only see about one film every month or two, and almost invariably the ones that are advertised in the papers. And yet fantastic films are being screened all the time as part of various film festivals. So while I was mashing the Melb Film Blog’s Google Calendar onto mine, I decided to ask Paul Martin, the author of said blog to help us out here at Troppo. I sent him this email.

Having subscribed to your blog via feed reader, one thing that keeps bugging
me is how much great stuff I’ve missed from not reading your blog. I’m now
trying to remedy that, but you probably know how time poor we’ve all become
in the age of the information deluge.

I don’t know if you know of Club Troppo but it’s a group blog commenting on
things of general interest to its authors who are interested in policy and
cultural things like films.

I wondered if there were any ways that we could co-operate to get
information to people quickly about opportunities to see great films.
Because so many of the best films are in festivals, often it’s critical to
get a ‘tip off’ from someone who is in your position, because hearing about
it from one of us amateurs who happens to have seen a film means it’s often
too late. I can certainly give you a logon to cross-post the reviews you
think we’d be most keen to read if you’d be prepared to do so. But perhaps
there are also other possibilities.

(Continued)

(Originally published in the business pages of the Melbourne Age and Sydney Morning Herald on 21 April 2010)

One of the sillier propositions which has been propagated on the internet and in a range of investment newsletters over the past couple of years is the idea that the ‘quantitative easing’ strategies pursued by central banks such as the US Federal Reserve or the Bank of England in response to the financial crisis amount to ‘printing money’ in order to finance mushrooming budget deficits, and must inevitably lead not merely to higher inflation at some point in the future, but (in the more extreme variants) to the sort of hyper-inflation experienced in Weimar Germany in 1923, or more recently in Robert Mugabe’s Zimbabwe.

It’s certainly true that central banks in most of the major advanced economies have pursued a variety of unorthodox strategies since the onset of the financial crisis in order to provide liquidity to the banking system, to support particular financial institutions or markets, and to get around the problem created by the inability to reduce interest rates below zero. These strategies have generally entailed central banks making loans or purchasing securities that they ordinarily would not, in much larger amounts than they ordinarily would, and for longer periods than they usually do.

Before the onset of the financial crisis, the US Federal Reserve’s balance sheet was of a size in the order of about US$900 billion, with the vast majority of its liabilities comprised of US dollar notes on issue, and most of its assets being holdings of US Treasury securities (that is, debt issued by the US Federal Government). After the collapse of Lehman Brothers in September 2008, however, the Fed’s balance sheet expanded rapidly, to around US$2¼ trillion (US$2,250 billion), by November 2008, and has remained at around that level ever since.

At no time since the collapse of Lehman Brothers has the Fed had more US Treasury securities on its balance sheet than the US$790 billion it had in mid-2007, when the financial crisis initially erupted. As of early this month, its holdings of US Government debt stood at just under US$777 billion. Thus, it is simply not true to say that the Fed has financed, or ‘monetized’, any part of the increase in the US Budget deficit since the onset of the financial crisis.

Rather, the money ‘created’ electronically by the Fed has gone largely to provide liquidity to parts of the US or global financial system that were critically short of it. For example, beginning shortly after the collapse of Lehman Brothers it provided as much as US$500billion worth of US dollars through swap facilities with foreign central banks (including the Reserve Bank of Australia). These facilities have now closed. The Fed provided liquidity to the US banking system and to various markets within the broader US financial system (such as that for commercial paper) in excess of US$1,000 billion on several occasions late in 2008. This support is now down to less than US$60 billion. It also provided over US$100 billion for the bail-outs of Bear Stearns and AIG; most of this is still outstanding. (Continued)

Ostensibly, Rudd’s reform package is about centralising funding and decentralising control. It may be that Rudd is drinking his own koolaid on this one. Previously I thought it was a package set up from the start in order to provide either to kill the Insulation Ignition Program or to provide a useful glittery centrepiece for the next election campaign when the premiers shot it down.

But no: he apparently wanted it to succeed this round. So a few billion dollars were promised to the premiers, and all of them accepted — except WA, possibly because they realise that they’ll be propping up the disasters in NSW, SA and the unavoidably expensive NT system.

But if Rudd believes that control will remain decentralised, he’s kidding himself. He’s forgotten the golden rule of politics: who has the gold, makes the rules. An even cursory examination of the management of higher education would make this clear. The passage of time has seen successive federal departments impose ever-more onerous regulation and stricture upon the universities. These self-governing institutions have been reduced to rather unflattering supplications in order to obtain their money-fix.

And so it will be with hospitals. Rudd has recreated everything bad about the federal higher education system: from the centralisation of power through money right down to centrally-planned price fixing.

My observation that the US is a normal sane country harbouring a crazy one inside it (that for all my admiration for him, Abraham really should have let the South slough themselves off into oblivion without polluting the Great Republic) has served inadvertently as linkbait and our visits have shot up about eightfold.

Anyway, even without the frisson from that adventure, I would have posted this new benchmark in craziness. It’s very upsetting, but we now have ” open-carry rallies”. Heaven help us from escalating craziness. And yes, folks, this kind of thing doesn’t get traction in Australia or any other developed country I can think of, except the benighted US. From today’s Melbourne Age.

DANIEL Almond, a three-tour veteran of Iraq, prepared to ”muster outside DC” overnight with several dozen other self-proclaimed patriots, all armed.

The were planning to make history as the first people to take their guns to a demonstration in an American national park. The Virginia rally is deliberately being held in sight of the Capitol, just a few kilometres from the White House.

Mr Almond (below) planned to carry his loaded pistol, his rifle unloaded and slung to the rear, a bandoleer of magazines containing ammunition draped over his polo-shirted shoulder.

The real-estate agent organised the rally because he is upset about healthcare, climate control, bank bailouts, drug laws and what he sees as President Barack Obama’s insistence on and the Democratic Congress’s capitulation to a ”totalitarian socialism” that tramples individual rights.

So-called open-carry rallies have been taking place all across the country. Hundreds gathered in New Mexico, Ohio and Michigan last week, and rallies were taking place in Arizona. . . .

The brandishing of weapons is ”not just an impotent symbol” but ”a reminder of who we are”, Mr Almond said. ”The founders knew that it is the tendency of government to expand itself and embrace its own power, and they knew the citizenry had to be reminded of that.”

Visit msnbc.com for breaking news, world news, and news about the economy

Comparing the Effectiveness of Regulation and Pro-Social Emotions to Enhance Cooperation: Experimental Evidence from Fishing Communities in Colombia

Abstract: This paper presents the results from a series of framed field experiments conducted in fishing communities off the Caribbean coast of Colombia. The goal is to investigate the relative effectiveness of exogenous regulatory pressure and pro-social emotions in promoting cooperative behavior in a public goods context. The random public revelation of an individual’s contribution and its consequences for the rest of the group leads to significantly higher public good contributions and social welfare than regulatory pressure, even under regulations that are designed to motivate fully efficient contributions.

A little more grist to my mill identifying just which are the craziest states of the United States of America.

Robert Manne’s new book (co-edited), “Goodbye to All That? The failure of neo-liberalism and the urgency of change”, is an attack on neo-liberalism.
There are several academic political philosophies currently in vogue: libertarianism (or its opposite): acute market intervention), classical liberalism and social liberalism.
Libertarianism objects to most forms of state intervention apart from a minimal role that protects against force, theft and fraud. Neo-liberalism is comparably defined by Manne as “the superiority of the invisible hand of the market to the economic intervention of government”. It argues that material prosperity and economic growth are best achieved through actions of individuals pursing their self –interest.
All the critical Reviews of Manne (which I have read) support his underlying thesis by re-stating the pro-intervention thesis – or they attack it on two distinct grounds: firstly, they adopt the authentic libertarian viewpoint; and secondly, they contend that “true” libertarianism does not exist.
This brings me to the main alternatives to libertarianism – classical liberalism and social liberalism. They both accept that a market system calls for a large degree of liberalism. For example, it insists on support for free international trade and market-based competitive pressures and it requires a floating currency, removal of the old controls on interest rates and international capital movements and free entry of foreign banks into the market.
Classical liberalism leans towards a higher degree of labour market freedom and ‘smaller government” – but allowing a greater role for government restraints than libertarians. On the other hand, social liberalism, while accepting the need for a liberal market economy, believes in a strong social safety net , seeks to promote substantive equality of opportunity, advocates increased financial regulation, accepts that debt is often necessary to finance privatisation and ensure overall macro-economic stability and wants safeguards to ensure that labour market regulation ensures fairness.
The reasons I am in the social liberalism camp is that It acknowledges that there are major equity/efficiency trade-offs in policy which need to be assessed.

No doubt some of you will know of this, but Prezi is a fabulous (relatively) new online platform for making presentations. It builds the presentation from a ‘mind map’. Very compelling, and it’s remarkably simple to put these presentations together from your browser. Check out this presentation on the new economy which is pretty interesting in and of itself. But it’s a fabulous illustration of Prezi’s capacity to visually represent the structure of an argument, the relationship between the slides or the elements of the argument.

Here’s an email I received from the Brotherhood of St Lawrence, disclosing an event that I’d like to go to, but won’t be able to. But some Troppodillian may wish to go.

‘War Child’ film tells the story of Emmanuel Jal: a child of war in Sudan, a boy soldier, a survivor, a refugee. Follow Jal’s extraordinary journey as he finds the courage to overcome adversity and rises to become an international musical artist.

This Emmy-nominated, feature-length documentary intersperses original interviews, live concerts, and rare footage of Jal as a seven year-old boy. ‘War Child’ will make you cry, laugh, dance and celebrate the power of hope. See why audiences from New York, Berlin and London have raved about this award-winning film.

DATE AND TIME: Thursday, 29 April – 6pm

VENUE: ACMI Cinemas, Australian Centre for the Moving Image, Federation Square, Melbourne

COST: $30 (includes live music, finger food from a world of diverse cultures, beer & wine)

To book tickets please call (03) 9483 2484, email events@bsl.org.au or visit our website www.bsl.org.au/whatson.asp

Please assist us by circulating this flyer to your networks. We hope to see you there.