Progressive politics without unions? "If you want progressive policies, the comparative historical evidence suggests it’s very helpful to have a strong labor movement" writes Lane Kenworthy. But in the US unions are weak and getting weaker. Is there an alternative strategy?
No such thing as bad publicity? "I’ve received the ultimate accolade from News Corporation", writes economist John Quiggin. As Paul Krugman notes in the New York Times, Quiggin "has received a full sliming from the Murdoch empire." More here, here, here and here.
What’s the biggest benefit of a liberal arts education? For many America’s undergraduates, it’s learning how to intellectualize your "own life choices in a way that belittles others and enforces class barriers." Or at least, that’s the conclusion Ed at Ginandtacos draws from a recent story in the Huffington Post.
Electric wheelchair etiquette: "I never collide with anyone," writes Carl, "at least not when I’m sober." At Working at Perfect Carl explores the unwritten rules of driving an electric wheelchair on roads and footpaths.
Are there no limits to Kevin’s power? At Catallaxy Files Sinclair Davidson posts a graph showing how Labor’s abolition of Work Choices caused the global financial crisis … or something like that.
UPDATE: Sinclair Davidson responds "Don Arthur over at Club Troppo interprets this graph as showing that Kevin Rudd caused the GFC. Don is one of the more smarter social democrats, so it’s unsurprising they can’t handle money or manage an economy."
Virtual horses at risk of starvation: Virtual horses in the online game Second Life may starve if the real life company that sells their virtual feed loses a real life court battle. Legal Eagle explains at Skepticlawyer.
They do like a misleading graph or two over at Catallaxy.
Actually they do not even mention the GFC in the article nor show it on the graph.
Nor is that much history before workchoices
Breath-taking even of Sinkers.Joseph would be proud.
Quiggin is in the news in other areas as well.
This bloke doesn’t hold back from blasting a review of Zombies.
Catallaxy also forgot to label July 2009 as the month in which the FW Act took effect. Coincidentally (and I don’t suggest it’s more than a coincidence), that’s also the month in which employment growth took off. Doesn’t really fit the narrative though, as they say.
That’s a lie – and you know it.
what was the point of it?
Sinclair he’s teasing. Jeez, everyone has to have the same sauce.
But Sinclair, doesn’t the economy manage itself through the magic of markets?
Of course, at times, astute management is needed, I grant you, to socialize the losses of imprudent bankers and to preserve the profit margins of miners expropriating publicly owned resources. But that is for the greater good, haw haw haw. In the meantime, we must be vigilant lest meddling social democrats plunge us into another GFC and resist reasonable demands that low-to-middle income earners pick up the tab.
Markets, Schmarkets. The real cause of the GFC was gravity waves a tremor in the orbit of cometary Venus which were picked up and amplified by alien artefacts on the Earth’s surface – for example Stonehenge, the Great Pyramid and the Easter Island statues – so powerfully that they influenced the lending decisions of the world’s major banks. It’s all explained on the internet, somewhere or other, probably in the suppressed wikipedia pages that you can only access from a router in Roswell, New Mexico.
Sinclair also wants us to believe that the ever remarkable Kevin engineered his heart surgery to avoid voting on a carbon tax. Unfortunately, unlike Kevins pulse Sinclair’s credibility remains undetectable.
“more smarter”?
John Black is former ALP senator – see his argument in the AFR.
Sinclair
John Black is a former ALP Senator who completely escaped my radar. I suspect you would have more credibility quoting Mark Latham. Appealing to dubious authority for stupid ideas doesn’t increase the believability of what you posted.
And by the way how do you know that Don attended public education? I’ve never asked him myself, but there are reasons to suspect otherwise – although it’s entirely up to hin whether he wants to illuminate us.
The question that remains unanswered is: just what the hell was the intended point of Sinker’s graph in that post at Catallaxy? Until we’re told that, Don’s interpretation of its intent stands as valid as anyone elses.
Meanwhile I’m happily rejoicing in the fact that Sinkers is neither managing my money nor managing the economy.
John Black has been punditting for a while. Can’t say I recall hearing of him as a senator.
Pedro/Peter – not my place to say if he was a good or bad senator, I don’t know. But he was a senator and the AFR touts his opinions, partly on that basis. I linked to the story and asked the question.
Paul – don’t want to be horrible, but if you think that graph shows that Rudd caused the GFC you probably don’t have money worth managing.
Don,
Don’t close threads. Why is it the fault of your libertarian visitors if they have to put up with conspiracy theorists who can’t remember who they are?
I’m replying to Peter here.
…and now back to a real discussion with someone who isn’t licking toads.
Peter. Actually it was in the same order of magnitude.
Why they need be any higher than 17% of GDP?
Yes that’s right.
Peter, are you being rhetorical here? How could you know I was wrong before and not know this?
In the Vietnam war it was about 3.6% of GDP and now it is about 2 %. Defence spending also fell towards the Vietnam war.
GDP growth. As GDP grows, the value of higher education grows as well. Unless you are saying the value of a BA in 1951 is the same as a BA in 2011 in absolute, real terms.
“4) The value of university educations are grossly overrated. Look at graduate earnings.
But both of you have ignored the public/private disparity. The median wages are for the Federal Government – which has had recurrent growth greater than GDP growth and wages growth greater than recurrent spending, GDP or private sector productivity.
You haven’t addressed the blowout in public sector recurrent spending since Howard’s second term or low public sector productivity. As long as the public sector has lower productivity than the private sector, I can clip off more than 12-16%. Why has recurrent expenditure grown by 4.5% annually over the last ten years, with wages growing at 5.5% (Feds)?”
You have also made the presumption that all the work the Government does is good. Why is it so good that they are employing lawyers higher than the market rate to enforce counterproductive drug laws the graduates themselves are likely to cheat on?
Here’s a challenge for you Peter. Tell me what level of GDP Government spending could be with the same or better outcomes.
I’d be interested to know if you think that there is no Federal-State duplication, wasteful programmes, over-allocation of x,y,z etc.
Don doesn’t think the FWA doesn’t matter.
In terms of pre downturn hours worked, unemployment hit 8% in the post GFC recession.
However unemployment only hit 5.8%. This was far below virtually every forecast anyone made.
We have not had a fall in GDI as high as what we had in the 2009 downturn with such a small fall in the level of workers losing their jobs, for a very long time.
There is no example like this in Australian history since before the war.
Employment growth and job ads took a lot long than that to “take off”. The driver of jobs and job ads were in WA anyway. NSW has the most retail and it has been copping it in the neck ever since.
Disingenuous little bugger, aren’t you? Of course you intended to be horrible. And you succeeded much to your discredit.
<smugly superior>As it happens, I don’t have any money worth managing but that doesn’t bother me one iota since I don’t measure my personal worth by the size of my bank account.</smugly superior>
-1 if you think the reason to acquire wealth is to feel morally superior.
Here I was think that it was a personal choice or not but it served a purpose to derive an income from it and have a higher quality of life (you know, being able to retire, buy medicine, computers, wine, housing etc).
think–>thinking
For the uncoolly morally superior typo Kings and Queens.
Sinclair, your link is next to useless. Anyway, it is a poor show to be reduced to peddling gossip.
Another positive comment from rog.
I discuss the banking crisis here (subscription required) and am happy for insolvent banks to fail.
Sinclair, I have seen Black in the Oz on occasions so someone else thinks him worth listening to. :-)
Mr D, then you obviously didn’t notice the numerous comments on Catallaxy against the finance bailouts. But anyway, those are two different things. The finance bailout was to stop of finance system meltdown. The stimulus was to end the recession by priming the pump. The biggest element of the bailout here was the unlimited guarantee, which was heavily criticised by libertarians and other classical liberals.
Given that they are different things you could hold different positions without compromising your ideology.
Oh please, enough of read-the-fine-print. You were certainly associating him with the accusations you made otherwise you would not have made those comments.
Denmore, are you living in a parallel universe? European nations are basically getting their heads handed to them on a platter because of their untenable fiscal positions and it appears that the entire western banking system is possibly imperiled if there’s one policy mistake from here on. One policy error and our banking system will turn into a plane crash… and don’t think Australian banks will be immune either.
The US is running a budget deficit of 10% of GDP. The recent debt ceiling increase that will be filled up by the time the next president is elected. This means they will be running a debt position of around 100% of GDP….. while looking for another ceiling increase on or about January 2013.
They weren’t bailouts as you think (and flamethrowers on the right too) they were. The shareholders of the failed banks were massacred with dilution.
The TARP was necessary. If there was no TARP the fed wire would have collapsed and you would not have been able to swipe you card to buy food at the supermarket. Even in Australia.
“The TARP was necessary. If there was no TARP the fed wire would have collapsed and you would not have been able to swipe you card to buy food at the supermarket. Even in Australia.”
Seems like welfare for suits to me, crowding out those efficient (and far smarter in terms of risk management) entities that would have replaced them had they gone to the wall. So now we’re stuck at square one still, and have yet to see any real regulation to stop the same thing happening again.
Conrad:
You’re flaming throwing like some on the lunatic right. In an ideal world yes, that would be correct. But we’re not talking about an ideal world here.
Large Banks have exposure (assets an liabilities) all over the world crossing dozens of different legal systems.
Imagine for a moment, what say 100 Lehman liquidations would look like all going on at the same time. This would be happening in different parts of the world mind you.
Also keep in mind that you need the Fed wire open to allow to access to consumers…. and by consumers I mean people going out and buying their food. Now imagine that you swiped your card somewhere in Ohio and the supermarket’s bank would take your card because it wasn’t sure it would get the money from the other bank. There’s huge intra-credit risk that occurs between the banks. What are you going to do for food that day?
When Bernanke said on the fateful weekend that if they didn’t do something the Federal Reserve banking system would collapse he wasn’t kidding!
(Example Citigroup goes broke).
Now imagine what happens if say a Milan judge places a freeze on say Citi’s Italian deposits (balance sheet) because there is a claim against Citi by an Italian bank. Now a imagine what would happen if the Germans saw that and their courts acted too, in order to protect German entities from losing out on their ability to make a claim because it was first come first serve and they placed an order to Freeze Citi’s German balance sheet.
Some people were suggesting that it would have been a good idea to hit the bond holders and have them come down a notch and become equity holders. That’s true. It would have been a good way to do it. However a large portion of senior debt ranks equal to depositors, which means that depositors money would have been at risk.
I have no problem with that in theory. However all this legal wrangling would not have taken place in 24 hours. you’d need weeks, months and years to sort this crap out.
Well that’s not true. There’s Basle 3 coming out requiring large banks that can create systemic risk to hold extra capital and there are a host of new regulations on line.
But here’s the problem. All this will require a credit tightening around the world as banks either have to raise new capital to meet these guidelines, or lower their balance sheets…. the knock on effect is less lending and higher credit costs. That’s not exactly a good thing for the world economy trying to get out of a huge bust.
In fact this is really freaking perverse, because we’re tightening up bank credit during the recovery phase when asset quality is pretty decent relatively speaking. Meanwhile there was a general global loosening at the height of the boom. The damn cycle is in reverse.
JC, you sound like the Al Gore of the suit world. If it was really so bad, why are all your libertarian colleagues happy to see it happen (not least of which appears to be SD at #25)?
Conrad:
The discussion as about TARP and the fact you thought it was a bailout for Walls Street. I was in fact a bailout for Main Street.
If Sinc disagrees with me, that’s fine.
oops
Damn Ipad.
The discussion as about TARP and the fact you thought it was a bailout for Wall Street. It was in fact a bailout for Main Street.
In any event if this is in fact true, conrad, we will soon find out what a full on liquidation is going to feel like.
http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/8682852/The-ECB-throws-Italy-and-Spain-to-the-wolves.html
This will make Lehman feel like child’s play.
JC, I’m sure defaulting is bad (just ask an Argentinian). It’s just whether it’s bad in the short term but better in the long term. It seems to me that kicking the can down the road doesn’t really help anyone unless you do something serious inbetween and even then, possibly not. I’ve no idea how Greece, for example, with a declining and aging population (and it’s professionals emmigrating) is ever going to get out of it’s mess without defaulting. It seems to me they would be better off doing it sooner rather than later.
Conrad:
It may be okay for Greece to default; the market could take that in isolation. I’m just not sure how a PIIG default on mass is gunna work out that may not take 15-20 years to “work” out.
If the Telegraph’s piece is correct (and they seem to be linking Spiegal) Greek default is already yesterday’s news. We’re talking here about an entire PIIG default, which would mean the end of the West’s banking system defaulting. It may well be German posturing, but we don’t know that until tomorrow. However if it isn’t I suggest we start a new calendar by referring to Monday as Day one. lol
That’s not two years of hard scratching by Greece alone.
JC, Greece’s fiscal position was a mess before any ot this happened. They went into the GFC with a debt to GDP ratio of close to 100%. That’s not an indictment of a Keynesian stimulus to deal with a demand shock, but a reflection of structurally unsound fiscal policies.
In any case, the public subsidy to finance capital predates the GFC. It was the hands-off, laissez faire attitude of both Democrat and Republican administrations to off-balance sheet banking and derivatives that caused the mess. The TARP was just the ambulance at the bottom of the cliff.
Unless I’m mistaken Denmore, every single country with a debt problem also participated in the Stimulus. So please explain how raising more debt helped Greece, or those countries in a fiscal mess, as I’d be really interested in knowing.
Which public subsidy is that? Please be specific. Also ensure that you are able to quantify the benefits derived from having a banking system that is more highly leveraged (thereby lending out more) than if banks were left as full privatized risk. In other words you really need to explain your subsidy and quantify it through a CBA not leaving out the benefits.
Absolute nonsense. American banking was/is the most regulated industry in the world.
We had
internal auditors
external auditors
State banking examiners
Fed examiners
Stock exchange audits
Futures exchange audits
FDIC examination
Compliance departments.
SEC checks/compliance
As for off balance sheet….derivative books weren’t what caused the problems. It was a good old fashioned real estate crash that did. Most of these assets where held in securities that the SEC itself and Basel 2 allowed banks to hold at preferential capital haircuts, as securities were thought to be far safer than straight loans. In fact the the SEC promoted securitization as a way of “strengthening” bank balance sheets. The thinking was that they could sell these off in a adverse liquidity event.
JC’s a Yank or a Yankee brown nose.
Who would’ve thought.
Oh JC, I can see you’re from ‘it’s the gumming that done it school’ so there really isn’t much point in arguing with you. But the reality was the US state was captured by the financial sector. The CFTC requested and was denied oversight of derivative trading and the SEC was a revolving door to Goldman Sachs, which in turn had a mortgage on the Treasury. The whole system was busted and compromised. Anyone with a modicum of common sense can see that.
Greece is red herring. You can’t judge the effectiveness of fiscal stimulus in Australia with what happened in a country that had no flexible on interest rates or currency. As for the US, you can take the meltdown in equity markets in recent days as an oh-shit moment as people reflect on the consequences of withdrawing stimulus in an economy barely back on its feet after the last knockdown. If fiscal repair really is urgent, the answer might be to cancel the Bush tax cuts, but your ideological brethren over there appear to have as much sense as you do.
I agree with Mr D about the influence of wall st in the US. But funnily enough, the one policy success was the wall st bank bailout. The problems in the US banking system are outside of wall st.
The continuing big problem is leverage. The are three varieties of govt leverage problems going around. A couple of countries have tanked on their banking systems, a couple of countries have tanked on the problems arising from a weak currency economy gaining a strong currency and the others have a problem that includes a significant element of future govt spending because of their welfare state.
The graph that was used a few days ago to allegedly discredit the republicans is irrelevant to the problem facing the US, which most assuredly is not an absence of debt finance govt spending.
But then you do; avoiding my responses (you0 adding ingredients to this soup you’re cooking.
Really? I often read the same sort of screed on both lunatic leftwing and rightwing sites, so where did you get that from?
So you think regulatory battles to increase territorial claims would have solved the problem in some of sort of magical way like Merlin waving his wand? You’re also avoiding the fact that derivative books had no direct participation the GFC.
Sure you can. Every nation in the EU participated in the stimulus so the flexibility of the exchange rate would have worked equally for them all. Secondly if it wasn’t going to work, as you say, why did the IMF and the Brussels ask them they participate? Demand it even.
Withdrawing stimulus in the US? Are you serious? The actual spending cut in the present year’s estimate is a humungous $21 billion while the budget deficit for this year and the next will be around 9% of GDP (around $1.2 trillion per year). If you think this is withdrawing stimulus then this is another universe. The recent cuts are all in the long term estimates.
Go ahead and raise taxes in the middle of a slow down. See what happens.
I find it really interesting that you’ve been everywhere peddling the idea that we should have a 100% state sponsored/sponsored/subsidized media but demand that the banking system which forms the arterial complex for the economy should go to the dogs. How do you compartmentalize your system of subsidies?
I haven’t argued for a state subsidized media. I’ve argued for a truly competitive media JC. I’m like you see. I like open markets. I just don’t think governments should be in the pocket of Big Capital, Big Media or Big Anything.
Really? So advocating a government going out to hurt “participants” is open markets is it?
I presume this below was a fair characterization of your advocacy, no?
And when News Ltd finally bit the dust and we’re left with Fairfax, I presume you would have no problem with a right wing government coming in and hurting them (Fairfax) when they get their turn.
Interesting interpretation of open markets Denmore.
You realize that how south American governments have operated since forever. Every time a new government comes into power they’d simply close down the opposing media group and support their own rent seekers.
There’s nothing really new in what you were advocating, you realize. It’s just a form of an anglicized version of *Caudillo economics.
*
Mate, News Corp are doing a very good job all on their own of driving themselves out of business. They don’t need the help of the government or anyone else. If they do crash, someone else will replace them. That’s competition which I assume you believe in? Good night.
.
So you want to see them fail by themselves, or do you want the government to give them a shove either through implicit or explicit bullying because it’s no longer clear what exactly you’re advocating, as before you were pushing for rarified caudillo tactics.
Keating was wrong?
Copy that.
Unless I am mistaken JC is arguing that Murdoch needs to be protected from the law. Others would argue that the law needs to be protected from the likes of Murdoch. Staying with the Romance language theme, in southern Italy protection is the business fari vagnari ‘u pizzu
Sinkers refuses to tell anyone what was the point of the ‘graph’
I think we know why.
This comment ‘Those vertical red yellow and black lines ob the graph are astonishingly arbitrary.
Uh, no. They mark policy changes that influence the labor market.
And by a freaky coincidence, the chart changes direction every time it hits one of those lines (except for the last election).’ was allowed so they could continue in their ignorant prejudice.
Joseph would be proud