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G20: Why to avoid a re-run of the 1930s

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Paul Mason | 11:05 UK time, Friday, 12 November 2010

A few months before he killed himself, the Austrian novelist Stefan Zweig wrote this, about the 1930s:

"All the pale horses of the apocalypse have stormed through my life: revolution and famine, currency depreciation and terror, epidemics and emigration; I have seen great mass ideologies grow before my eyes and spread, fascism in Italy, national socialism in Germany, Bolshevism in Russia and above all the ultimate pestilence that has poisoned the flower of our European culture, nationalism in general."*

The 1930s, which began with a financial crisis, would see the worst depression in capitalism's 200 year history, and then a combined trade and currency war which solidified the world into competing economic blocs. By the time some of those blocs ran out of natural resources, towards the end of the decade, the pathetic military machines they had possessed in 1929 had become capable of conquering countries where those resources lay, wiping out whole parts of their populations in the process.

The great cosmopolitan cities, like Zweig's Vienna, would be scoured of all that was cosmopolitan: their Jewish communities, their academic freedom, their modern art, their gay nightclubs, their labour movements.

This is why you do not voluntarily want to re-enact the 1930s. But it is the shadow of the 1930s that has fallen across the G20 summit in Seoul. The leaders emerged, as we knew they would, without what David Cameron called "a glistening headline" - only 12 months after they had signed up to one glistening paragraph after another in Pittsburgh.

The sticking point, we are told, is "the global imbalances". Once arcane, today everybody who can read a newspaper, or Wikipedia, knows basically what they are: China produces, the west consumes; China saves, the west borrows; China exports, the west imports. This arrangement, which was once vaunted as a kind of yin-yang harmony pictogram for the world economy is now seen, rightly, as dysfunctional.

However, another way of putting it is that globalisation itself has become dysfunctional - or at least the form in which it has developed for 20 years.

To solve the imbalances you have to understand their causes - and there is a wide literature on this, which I will summarise.

The two main theories are called "savings glut" versus "over-borrowing". The over-saving thesis says: China's workers and businesses save too much and spend too little, the surplus capital in the world depresses the rate of interest and that cheap money flows into the western financial system creating boom and bust cycles.

The "over-borrowing" thesis says: America's population has become addicted to cheap credit, credit has replaced rising real wages, de-industrialisation pursued for a fast buck by firms offshoring their operations to China means the USA cannot restore its trade balance.

There is a third theory, advanced by economists at the Bank of France among others, known as "the investment strike": because (for the reasons outlined above) general rates of return are low, non-financial companies under-invest to keep headline rates of profit high. This too ensures the major part of capital remains in the financial system, depressing returns and creating bubbles. Martin Wolf's book "Fixing Global Finance" contains a much more detailed account of all this than I can give here.

It should come as no surprise that the proponents of blaming China are US economists, including Fed chief Ben Bernanke, and that supporters of the over-borrowing explanation are mainly sympathetic to the emerging markets.

But the trade, production and consumption imbalances are only one part of the story. The other is the labour market. Looked at from a labour market economics point of view, the problem is this: in the USA real wages have stagnated on some measures since 1973; in China, though they are rising, the labour market barely functions: large parts of wage costs are borne in the form of dormitory accommodation and three meals a day in the works canteen; anecdotally when western companies try to pay their workers more they are prevented by the CCP or its union, the ACFTU. In both sides of the world economy, the sustainable sources of consumer demand are depressed.

So one answer to "the imbalances" would be for real wages to rise both in China and in the West - however, put like that, "correcting the imbalances" looks more like "rolling back the Thatcher, Reagan, Deng Xiaopoing revolution in labour flexibility".

So how could the imbalances be resolved? On paper it is obvious: China has to stimulate domestic demand - not just for railways and bridges but for consumer goods and services - by raising wages and bringing in a welfare state. I have met farmers in China using 60% of their disposable income to send one child through university. Meanwhile the west has to become more industrial, its consumers have to save more and become less obsessed with buying cheap tat at large supermarkets.

America, above all, has to get its productive capacity back. If you wanted to be really controversial you could say that everywhere has to become a bit more like Sweden and Germany. I say controversial of course because, outside of these two countries, the "social model" they represent is widely despised.

So here is the challenge: you either rebalance through collaboration or you do it through competition.

America could easily plot a course to re-industrialise, upskill, raise wages and raise savings (and eradicate debt) as follows: trade controls against China and Latin America, massive money printing to stimulate inflation and shrink the national debt, aggressively devalue the dollar. The problem is it is half doing this without really trying: its QE2 policy does stimulate inflation and depress the value of the dollar. This is what Alan Greenspan meant when he wrote, two days ago in the FT:

"America is also pursuing a policy of currency weakening. The suppression of the renminbi and the recent weakening of the dollar are, of necessity, producing firming exchange rates in the rest of the world to, as they see it, the rest of the world's competitive disadvantage."

Tim Geithner hit back that he had no such intention, but in China, they do not care about the ideas inside Timothy Geithner's head, they care about the actions he is taking.

When it gets to this point what you need is a grand bargain; a spectacular (glistening if you like) gesture to which all sides sign up. That is what Keynes urged the participants at the London Conference in 1933:

"Our plan must be spectacular, so as to change the grey complexion of men's minds. It must apply to all countries and to all simultaneously. Each at the same time must feel able to remove barriers to trade and to purchase freely. If we all begin purchasing again, we shall all have the means to do so."

At that point the world's leaders were three years into the post-crash reality and trade war was looming. On 21 September 1931 Britain's new coalition government had left the gold standard, after pay cuts in the Royal Navy led to the Invergordon Mutiny, and a resulting run on sterling. Though they did not have the theoretical means to understand it, Britain had inadvertently saved itself from the worst of the Depression by devaluing sterling ("We didn't know you could do that," one hapless former Labour minister famously said). It had "beggared thy neighbour".

America, meanwhile, stuck to the old orthodoxy: though it was to begin Quantitative Easing in April 1932, it would stick to gold until 1933 - forcing itself to adopt deflationary monetary policy even as it tried to escape recession.

The lesson of the early 1930s has been drawn for us by one of the modern world's greatest economists:

"If monetary contraction propagated by the gold standard was the source of the worldwide deflation and depression, then countries abandoning the gold standard (or never adopting it) should have avoided much of the deflationary pressure. This seems to have been the case...There is a strong link between adherence to the gold standard and the severity of both deflation and depression"

That is a quote from Ben Bernanke's 1991 paper, The Gold Standard, Deflation and Financial Crisis in the Great Depression (with Harold James). Bernanke shows that countries that devalued their currencies first, recovered first. Those that refused to do so were driven by the orthodoxy of the time, shared by capitalist and communist alike, that strong currencies linked to metal were the only guarantee of economic stability.

Right now, countries are beginning to draw conclusions from Bernanke's insight: nobody wants to be the last person to devalue. Right now the USA is inflicting currency pain on all its supplier countries except China; China is inflicting pain on the USA through its dollar peg; Germany and Sweden are inflicting pain on the rest of Europe by using their competitive advantage within a mini-Gold Standard known as the Euro to outproduce the so-called PIGS, which are close to penury.

If the currency war continues, sooner or later trade war will follow.

What politicians are learning is that you can't stop trade wars by meaningless declarations: you can only do so by co-ordinated policy and by a massive shift in assumptions and accepted wisdom. By massive, heroic gestures like the ones Keynes urged. Geithner himself has put his finger on what such a gesture might entail: a one-time voluntary cap on trade surpluses by China, Germany and the other exporting countries in return for a reduction in budget deficits and debt. This is what never got close to happening at Seoul.

They are also learning that democracy and recession are great drivers of trade and currency war: though the central bankers form an unelected global club, the politicians they technically serve have to get elected every five years or so. There is a chance, sooner or later, that a party will come to power in a western democracy committed to overt trade and currency competition with other countries, whether it's the Greek KKE with its desire to leave the Euro or the Teaparty wing of the Republicans with their desire to declare trade war on China.

In addition, as my colleague Stephanie Flanders has pointed out, this was the summit where global consensus slightly fractured: the world view of the global south and emerging Asia was for the first time equally represented. Gordon Brown may have declared the Washington Consensus is dead, at London in April 2009, but it was in Seoul that the non-consensus emerged. The Washington Consensus, it is clear, will not be replaced with a new unity, but a new agreement to disagree.

This is where it becomes problematic - because unlike the 1930s, the world economy is massively more interlocked: in fact it is fused rather than interlocked; it is networked together by global financial flows, derivatives, multi-country production lines, massive raw material trade dependency.

Just take a look at the objects in front of you, and on your person, as you are reading this and make a list of where they come from; and then take your wallet out and ask how much credit would be available on your plastic were the source of it to be only the savers of your own country. Any return to competing trade blocs would shatter the modern world just as completely as 1914 shattered the world of coffee, cake and coloratura that nurtured Stefan Zweig.

Of course, what we now rely on is the various bilateral and multilateral bodies - the IMF, WTO, EU etc - to try and patch things up. They may have missed their chance for a spectacular circuit breaker but they could still patch things together. Even if patching things together is not as good as doing a deal on trade, climate change and currencies it is what they have to do.

Because there is one more reason why we do not want to re-run the 1930s if we can avoid it.

When the "pale horsemen of the apocalypse" visited Zweig's generation, it came as a total shock to them that they brought genocide, war, bombing of civilians, forced migration, disregard for the Geneva Conventions in war, and the overt attack on rationality by mobs devoted to medieval ideologies.

Unhappily, these phenomena are familiar to us already.

* Stefan Zweig, "The World of Yesterday", trans. Anthea Bell, London 2009, p20

Comments

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  • Comment number 1.

    Best business/economics blog on BBC website.

  • Comment number 2.

    "The great cosmopolitan cities, like Zweig's Vienna, would be scoured of all that was cosmopolitan: their Jewish communities, their academic freedom, their modern art, their gay nightclubs, their labour movements.

    This is why you do not voluntarily want to re-enact the 1930s. But it is the shadow of the 1930s that has fallen across the G20 summit in Seoul."


    Who is the you there?

    What Germany feared and fought off in the 1930s was not freedom but Bolshevism-of-the-left (oddly a right wing libertarian movement in practice). They saw (correctly I would suggest) what you describe as anarchism. That is what Lenin described as an infantile disorder. It is anarchism, a child's narcissistic view of the world. One has to distinguish the German (and Russian) Labour movements at the time (it was the Russian Labour party which led the revolution, essentially Fabians hence the Webbs' support of Russia in the 30s and 40s) from libertarian anarchism - the free-market. Even Russia was fighting off (purging) left wing communism as anarchists in the 1930s. This is why Germany and Russia were essentially allies from 1939-41 (see point 6. What happened from summer 1941-1947 was that state socialism (the National socialists were left-wing statists) swept westwards into Europe, it's spread was only halted by the vole face of the Jewish Morgenthau Plan into the Marshall Plan. Even Britain went left in 1945. Orwell was attacking Fabians in his 1984 (it's the centenary of the birth of the Fabian society which was in 1884).

    Blair/Orwell was, by his actions in support of the POUN/CNT a left wing communist, a Trot, an anarchist, a free-market shill.

  • Comment number 3.

    Another definitive blog. Monetarism free float exchange currencies and free markets and trade are irrelevant. Trade wars are inevitable and desirable if mass unemployment and civil disturbance is to be avoided. What devaluation of the dollar or the pound would be necessary to balance with China and others. Trade wars could be 'cold' and even managed under a consensual protocol but it requires the old economic dogma of free markets and laws of supply and demand to be relegated to the third division. Global corporations dont believe in them any more and nor do the Chinese. Trade war could be quotas and trading agreements. Reinvent Bretton Woods but I dont see Bernanke as a reincarnated JMK

  • Comment number 4.

    OK so we've established that Tabblenabble is into glider clubs and riding boots..

  • Comment number 5.

    Paul, you really are a cut above.

    Once again this is peerless: magisterial in tone, rich in content, yet easily understood by the average non Wonk.

    One day the best blog prize will deservedly be yours.

  • Comment number 6.

    Yes, let's get below the surface appearances & understand the economic crisis.

    The over-saving & over-borrowing explainations are still on the surface.

    The investment-strike gets closer as it alludes to the Marxist description of there being few profitable investment opportunities.
    But again, we need to get below the surface.

    The vulgar, shallow, mainstream economists of today just see imbalances because their models do not have the rate of profit at the forefront.

    Keynesians get closer than most because they see under-consumption.
    But they don't have a deeper model of what causes such under-consumption - they resort to 'animal spirits'.

    Paul, you must have read Rosa Luxemburg's Accumulation of Capital?
    Can you see the accumulation problem she was posing (which Marx had overlooked)?

    To understand the problem requires an understanding of value - of exchange-value (aggregate prices) & underlying value (in terms of socially necessary labour).
    Without this understanding you can't understand money, commodity production & boom & bust.

    Many Marxists just rather lazily recite the tendency of the rate of profit to fall (one of the main themes in Volume 3 of Das Kapital).
    They neglect the fact that capital accumulation & so an increase in the organic composition of capital can be offset by an increase in the rate of exploitation.
    Which is why the theory fails to explain adequately the boom & busts of capitalism's history.
    But the tendency of the rate of profit to fall does actually come into play when capitalism can no longer grow through increases in the labour force & has to resort to increasing surplus value relatively.
    (I know I may be losing a few people here, so think of it as capitalists having to grab a larger share of the cake because the cake is no longer growing).
    And with increases in energy prices, the rate of exploitation is going into reverse.
    A falling rate of exploitation & increases in the organic composition of capital will force down profit rates & cause a depression.

    But the tendency of the rate of profit falling due to capital accumulation (i.e. increases in the organic composition of capital) isn't the main factor going on (arguably).
    There's also the growth in unproductive labour (labour that falls outside of the circuit of capital; i.e. doesn't produce the means of subsistence to keep the workers alive, or produce new machines/buildings to replace depreciated capital or new capital investment).
    So police, lawyers, prison officers, social workers, insurance workers, bankers, etc are unproductive workers.
    This is not a moral-value judgement.
    Musicians are unproductive, but thats not to say we want a society without musicians.
    The simple fact is they consume what is produce by productive workers.
    In Marxist terms they get a share of surplus value & so depress profit rates.
    This, I'm guessing, in one of the main reasons for the fall in profit rates in the West.
    Those bankers & traders in the city are largely living off the surplus value created by Chinese & other emerging economy labour.

    Then there's the important ficticious capital.
    This essentially is exchange-value (aggregate prices) expanding faster than value.
    In otherwords, the value of what is produced in production is less than aggregate prices & this artifically increases reported rates of profit.
    The form this takes is mainly asset price inflation in property & shares.
    The asset bubble hides the true fall in profitabilty.
    The US dollar role as world reserve currency (fiat money) is the main reason for fictitious capital.

    This was all collapsing in 2007/08 as Banks realised that the western consumer was debt-saturated.
    So to keep the Ponzi scheme going money had to be printed.
    And yet more money will be printed to continually stave off the fall in capital values & depression.

    But they are running on ice as the ice is breaking.
    Eventually they will go under.

    Only then will people start to question why we have a system that is based on profit & periodically collapses with massive social costs.

  • Comment number 7.

    suppose the uk did what china did. Forced workers into dormitories on 3 meals a days from a canteen on fixed pay? The lefty unions would be the first to shriek?

    china is not playing by the same rules we have to. We pay carbon tax while they get carbon money while building a coal power station a week or what not. They ignore human rights, intellectual rights, environmental laws while we get fined if we ignore those 'costs'.

    china has a different model and different social end game. they are not interested in individualism [and all those pesky rights]. For them its 'Every citizen a soldier' ie every citizen is a tool of the state which works for the collective. Individualism is seen as luxury or even counter revolutionary.

    Given commodity prices are the the same for everyone worldwide why can't we make our own goods? Who is unfairly undercutting? What are the vested interests in the uk keeping land rents high, who are the firms objecting to domestic competition? That is where one should look rather than that smokescreen and disinformation about who spends and who doesn't.

    Cameron looked a fool saying chinese don't spend enough. Rather it is those who squander and let their money go easily who are fools. Fools and their money will soon depart.
    Cameron calls china to democracy. China in turn can call the Uk to communism. They may ask 'who is richer, who has the trend of growth and who the trend of poverty'? They could say democracy makes ordinary people poorer as it must pander to the interests of the rich. These are questions the hayekist uk govt cannot counter because the answers are manifest in everyday life.

    so the argument goes of those who adopt class or money as the highest idea of the mind. If one adopts the good as the highest idea of the mind then money or class is not the final arbiter. One might adopt different terminologies. Better free and poor than secure and a slave [like the chinese worker] etc.

    west and china have different highest ideas of the mind. There is no common ground.

  • Comment number 8.

    If I'd been David Cameron I would have talked about workers rights to the Chinese: "Take a look at yourselves; you're supposed to be communists."

  • Comment number 9.

    In 1930 no one yet knew that they had entered the First Great Depression.

    In 1939 men across Europe sighed with a heavy heart as they pulled on their uniforms and marched off to war.

    There are incredibly well paid men in positions of power now, men whom we are told are incredibly bright and whose every word is waited on, who have no idea that they place in the history and cause of the Second Great Depression has already been written.

    Human Nature - how do you quantify that in a Depression?

    Can people truly not see what is beginning here?


  • Comment number 10.

    This is not 1930's. There is no gold standard acting as the arche for money. We live in a world of fiat currency inscribed by the Fed, and inasmuch as China pegs to this, it is defacto using the dollar too. If we want to look for an arche for our modern economy then that would have to be oil. This is vital for our modern globalised marketplace. It is produced under tight control through OPEC, and the market is managed shrewdly by it's operators.

    We have seen in recent weeks that US currency action has a direct affect on the dollar price of oil. I do not think it is possible for the US to abandon this "gold standard" easily. The game to play for Bernanke is to drive up the cost of oil ( and other commodities) for China, and hence force a revaluation of the dollar peg.

    The downside ? How would US motorists react to gas at $10 a gallon

  • Comment number 11.

    ... the surplus capital in the world depresses the rate of interest and that cheap money flows into the western financial system creating boom and bust cycles.

    And isn't one problem of QE that it's just creating another bundle of cheap money?

    @7 jauntycyclist

    I don't really see the point in obsessing about China oppressing their workers, pegging their currency and generally "not playing fair". They're playing to their own agenda, and I don't really see Western capitalists as honourable cricketing gentleman. They've been happy to see wage levels in the US and Europe depressed, and mass unemployment to keep the workers in their places (middle or working class).

    If you wanted to be really controversial you could say that everywhere has to become a bit more like Sweden and Germany.

    It was interesting to see recently that Germany is running a substantial trade surplus with China - as is Japan, Taiwan, Australia and Malaysia. So "global trading imbalances" are not so one-dimensional. Maybe the imbalance is due to countries who have made the wrong economic choices in the past 20 years.

  • Comment number 12.

    This is one of Mason's best posts.

    As an American, I believe our economic problems are quite clear.

    Almost half of my country still lives in the 1800s, or wants to. Education is the best example. During Depression 1.0, education was not really important. To work in a factory or in the fields, knowing how to count was sufficient. Today, a high school education is only sufficient to work in a restaurant or the fields, and neither career path lies on the road to riches. Yet the Tea Party, Republicans, Libertarians, and like-minded people honestly believe that education is every individual's problem. If I were king, I would issue a JFK-esque call to educate the country before the end of the decade. I would implement Germany's practice of separating students into trade school and university groups.

    I would eliminate the H-1B and L-1 visas used to import cheaper, educated workers, forcing employers to think about educating their existing work force instead of treating local workers as throwaways. I would reverse the tax advantages for outsourcing, making it attractive for companies to relocate back here.

    And reregulating Wall Street -- and your City -- is essential. The obscene bonuses are bad enough, but all of the money that could be used for investment in infrastructure and manufacturing goes to an industry that creates absolutely nothing of value. All of the people worrying about whether bankers would emigrate to Shanghai are forgetting one large fact: China does not suffer economic fools gladly. As we saw with some of the sadistic freaks who poisoned Chinese children with melamine, China would execute bankers who take their economy down.

    Mason wrote: everywhere has to become a bit more like Sweden and Germany"

    I think you are mixing your stories here. Sweden and Germany are not that similar, trade-wise. Germany is an exporting powerhouse, second only to China, while Sweden is 27th in the world, just behind Poland. I would very much like the USA to become more like Germany.

    Mason wrote: "massive money printing to stimulate inflation"

    Here I disagree. As I wrote in my blog post, "Ben Bernanke and the kingdom of crystal skulls," QE2 is a gift to the wealthy. If we are to print money, it should be used as in the Depression era WPA and CCC agencies, i.e. to directly create jobs.

    Another thing you could have written about involves the WTO. China joined in 2001 and never seriously opened its markets, all the while expecting the world to accept Chinese goods. Now we are repeating the mistake with Russia. The G20 should expel China from the WTO and prevent Russia from joining until both of them open their markets and eliminate IP theft.

    http://saucymugwump.blogspot.com/

  • Comment number 13.

    Merkel is the only Western leader to get it spot on - how much longer will the people put up with the bankers, who caused this mess, getting richer at the tax-payers' expense?

    Merv King seems convinced that if he keeps saying that there is no UK inflation then people will believe him. Economically illiterate politicians may believe him but Joe Public who is seeing the cost of food, fuel, heating, etc, rise weekly knows differently.

    Ah, but unlike politicians King does not need to get re-elected.

    I believe we are months away at most, perhaps weeks or even hours, from a major down-turn in the global economy. Sovereign debt, bonds, gold, equities - one or several is bound to give sooner or later and cause a domino affect that politicians and central bankers will be unable to control.

    The NASDAQ is now close to its 2007 post-dot.con height, gold is hitting the roof and traders, almost to a man, are convinced that the DOW, FTSE et al will continue to soar. In times of such over-confidence it is perhaps best to step back.

    Will Merkel be proved right? How much longer will the masses put up with the rich getting obscenely rich at the impovishment of the masses?

    I would argue - not much longer.

  • Comment number 14.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 15.

    So how does the Bank of France/Wolf theory of an 'investment strike' relate to Richard Koo's concept of a 'balance sheet recession'.

    Koo's theory based on the experience of Japan's lost decade (during which he was an economics advisor to the government) posits that following a binge of over-leveraging corporations react to a recession by trying to rebuild their balance sheets - using revenue to reduce their debts and liquidate unprofitable assets rather than trying to expand turnover.

    Koo believes that this was the fundamental problem not just for Japan but for the 1930s as well, and although not a Keynesian, believes that the very worst thing governments can do is retrench in that the only thing standing between recession and depression is vigorous government spending - which even though it cannot alone end a recession (that won't happen until the capitalists have decided that their balance sheets have been restored) can stabilise the situation short of catastrophe.

    In fact with occasional departures that were soon abandoned he claims that this is pretty much exactly what happened with Japan - the recession lasted a decade but never produced the economic and social catastrophe which would have resulted if Japan had followed the advice of orthodox economists.

    The downside which Koo is too polite to mention is that it did result in the concreting over of a large part of Japan as successive governments could think of nothing better to do with its stimulus than give it to the politicians paymasters in the construction industry - however like it or not most Japanese would probably consider that preferable to losing their jobs.

  • Comment number 16.

    11

    in a zero sum game [see mervs speech from a couple weeks ago] for china to get rich someone has to get poor. our councils are turning street lights off. why is pointing out that Chinese communists are taking an aggressive pro active macro and micro economic approach to making us poor an obsession? I agree the uk hayekists have no love of ordinary people either which is why the foreign backed energy companies get away with outrageous increases in fuel bills.

    there need to be tariffs on Chinese goods to balance out their manipulation. They really don't care if the capitalists society falls. it would 'prove' their ideology.

  • Comment number 17.

    #12 saucymugwump

    'All of the people worrying about whether bankers would emigrate to Shanghai are forgetting one large fact: China does not suffer economic fools gladly. As we saw with some of the sadistic freaks who poisoned Chinese children with melamine, China would execute bankers who take their economy down.'

    ------------------------

    I totally agree and I wish that at least one journo or interviewer, on either side of the Atlantic, would ask where are the bankers going to go when they threaten to leave.

    The places that they keep threatening to go to - China/Hong Kong, the Middle East - would most likely have not have been so forgiving if the bankers had created such an economic mess over there as they have done so over here.

    At best I suspect most of the bankers would have had all their wealth seized before being thrown in jail. At worst, well I think we can all guess what the worst outcome might have been.

    The bluff of these people should have been called.

    Again, there seems to be a huge disconnect between how politicians perceive the mood of the People and the growing anger on the streets, in the offices, homes and pubs, etc, that the Public are now feeling not just towards the bankers but also towards politicians.

    I suspect, for historical reasons, Merkel is more aware of the dangers of ignoring such voices.

  • Comment number 18.

    In #10, supersnapshot wrote: "How would US motorists react to gas at $10 a gallon"

    There would be outrage at the government. People in the large cities, e.g. NYC and Chicago, would not be affected because they would simply continue to use mass transit. However, in most of the country, people would not have an option: they would have to pay the additional price and it would drive many people into poverty. Trains are not common here, as they are in the UK and the Continent. Outside of the major cities, busses are not an option.

    Even Mason probably does not know the reaction to plans to build mass transit here. In Denver, Colorado, there is a Libertarian named Jon Caldara. He is a typical Tea Party type, and has been that way for many years, long before the advent of the Tea Party. When Denver debated its light rail system, he actually wrote that we should not build a mass transit system; we should buy a few limousines to transport the wealthy from the suburbs to downtown. This genius could not imagine that wealthy people do not ride mass transit systems, but that the poor and middle classes do. Today, Denver's light rail system is standing-room-only during rush hour and not empty during the rest of the day.

    In #11, gastrogeorge wrote: "Maybe the imbalance is due to countries who have made the wrong economic choices in the past 20 years."

    Correct. Germany manufactures the highest-quality machine tools and automobiles in the world and the world covets these products. I am truly embarrassed at my government's proposal that Germany and China reduce their exports so the USA can recover. We should put our own house in order, not ask others to tear their house down.

  • Comment number 19.

    In # 7, jauntycyclist wrote: "west and china have different highest ideas of the mind. There is no common ground."

    This is very true. It reminds me of what happened during the Yalta Conference in early 1945 (the curious should read "Yalta: The Price of Peace" by S. M. Plokhy).

    Churchill regarded the concept of "spheres of influence" as a literal one, i.e. a place where Britain could influence events to a great deal. Stalin, on the other hand, regarded the concept as absolute, i.e. he wanted total control of the government. Churchill quite simply did not understand Stalin's extreme position and therefore accepted Stalin's promise that Eastern Europe would be independent.

    Churchill wanted control of Greece, so much so that his forces smashed a Communist uprising. Yet he complained when Stalin smashed protests against Communist governments in Eastern Europe. What is sauce for the goose is sauce for the gander. Either countries are free to choose alternative governments or they are not.

  • Comment number 20.

    6. At 1:05pm on 12 Nov 2010, duvinrouge wrote:

    "Paul, you must have read Rosa Luxemburg's Accumulation of Capital?
    Can you see the accumulation problem she was posing (which Marx had overlooked)?"


    Self-centred idealism/cognitivism can prevent one from seeing what makes one an anarchist and why Lenin was so critical of anarchists as the unwitting 'useful idiots' of exploitative capitalism.

    "To a considerable degree, Lenin's well known polemic Left-Wing
    Communism: An Infantile Disorder is an attack on the ideas of the emerging left communist currents. His main aim was to polemicise with currents moving towards pure revolutionary tactics by showing them that they could remain based on firmly revolutionary principles while utilising a variety of tactics. Therefore Lenin defended the use of parliamentarism and working within the official trade unions."


    The truth revolution in Russia, carried forward by Stalin after the purges of anarchists in the last 20s and 30s, was essentially just Fabian Socialism, aka Old Labour. Beware of Western Trotskyite versions of the USSR's history. They are libertarian.

  • Comment number 21.

    Imagine a gang of thieves having just robbed their neighbours, but now sitting together discussing the possible knock on the door by the local police. Imagine them talking of the police as Horsemen of the Apocalypse who are out to catch and drive them out of town for no good reason except that said police are nasty people who pick on people like them.

    The police are anti-roberist they say to each other. They are cruel and nasty etc.

    Hard as it may seem to normal people with a normal conscience, that's pretty close to how (criminal) psychopaths think and behave. See the problem? Most people can't believe they exist, but they do. Some of them can write very well, some are very clever.

  • Comment number 22.

    "China produces, the west consumes; China saves, the west borrows; China exports, the west imports. This arrangement, which was once vaunted as a kind of yin-yang harmony pictogram for the world economy is now seen, rightly, as dysfunctional."

    Do you appreciate that you are also describing the (temporary) relationship between adults and children, parents and infants. It is not sustainable. We have regressed, it shows in our academic attainment data and our social disorder statistics.

    "However, another way of putting it is that globalisation itself has become dysfunctional - or at least the form in which it has developed for 20 years.

    To solve the imbalances you have to understand their causes - and there is a wide literature on this, which I will summarise.

    The two main theories are called "savings glut" versus "over-borrowing".
    The over-saving thesis says: China's workers and businesses save too much and spend too little, the surplus capital in the world depresses the rate of interest and that cheap money flows into the western financial system creating boom and bust cycles.

    The "over-borrowing" thesis says: America's population has become addicted to cheap credit, credit has replaced rising real wages, de-industrialisation pursued for a fast buck by firms offshoring their operations to China means the USA cannot restore its trade balance."


    The old way of describing this conflict was between statism and libertarian free-market anarchism. The parents always lose patience in the end (sometime in adolescence) and throw out their over entitled narcissistic parasites for their own good. The adolescents get very mouthy in process, but to no avail. These are the arguments you are marshaling. That is the way to see this in stark reality. In the 1930s Germany, they'd had enough. Much the same happened in the USSR.

    Did the adolescents flee Westwards to UK and the USA? . Some folk never fully grow up cognitively, that's inevitable. It's a fragments of cognition issue (here, spatial/logical reasoning perhaps?). Some say it's also true of females as a group (they stop growing earlier in some cognitive areas which keeps them attractively child-like to males), which is possibly why males feel obliged to protect children and women at times of social duress and war. But what about feminised males, the ones who argue all the time - a bit like women? What happens now that everyone is allegedly equal and half the workforce is female alone?

  • Comment number 23.

    @16 jauntycyclist

    I wasn't particularly digging at you but at the general mentality from many people that the problem is somehow due to China not playing fair. My point is that nobody plays fair - least of all our ruling capitalists who are happily lining their pockets while everybody else can rot.

    I, also, would be in favour of erecting some trade barriers - they have their place. [Which country recovered from the SE Asia crisis fastest? Not those that followed the IMF consensus and cut the state, but Malaysia that ignored this advice and imposed capital restrictions]

    The problem, though, is that if we imposed barriers to China, who would manufacture the goods that are in demand. Not the UK (in the short term), as we don't make things any more (in any volume at a tolerable price). So manufacturing would just be displaced from China to Taiwan, or Vietnam or India or wherever. So a gradual and targeted approach is needed.

  • Comment number 24.

    Anything which is not discussing banking is not tackling the issue Mr Mason.
    Just gossip and not much mroe than tabloid journalism.

    1.Split casino from retail
    2.Hike reserves required in 2 years not by 2018 (BASEL3)
    3. Make Act of Parliament we will nevr again bail the banksters out.

    At a stroke bad lending would cease. Our currency would soar. We would be the most attractive country in the west for investment. Our cost of living would plummet so our standard of living would soar. Theodore Hayek - not John Keynes.
    Yes 2-3 years of recession but compared to 25...!!! I refer you to Japan now and the West in 1930s.
    Oh how about US 1921 - when they did opposite to Keynes. How come you NEVER talk about that?

  • Comment number 25.

    "4. At 12:49pm on 12 Nov 2010, SeanBroseley wrote:
    OK so we've established that Tabblenabble is into glider clubs and riding boots.."


    No, I'm describing why what happened, did happen. What you are now seeing is the consequences of not learning form history. Just look at how our demography is changing. It is the same pattern which concerned people here in the 1930s and which, led to the Welfare State. The same happened in Germany (and Russia). Ask who doesn't like statism and you will see the problem. Some adolescents never grow up. They just demand freedom. They don't see how it's always at other people's expense..

  • Comment number 26.

    "So how could the imbalances be resolved? On paper it is obvious:
    China has to stimulate domestic demand - not just for railways and bridges but for consumer goods and services - by raising wages and bringing in a welfare state. I have met farmers in China using 60% of their disposable income to send one child through university."


    It's a radically different political system. Do the numbers. It's highly selective based on native ability. According to the above (a little dated) source, they select only the top 5% of the population's cohort, and available places are heavily weighted towards science/technoloy (2:1) as a function of national demand. It's a planned, managed socialist economy. One should not look at it through libertarian eyes. It leads to irrationalities.

    Maybe the farmer wanted to pay for something extra?

  • Comment number 27.

    The guy who I was talking to just now, his mother had to flee Zweig's Vienna. So did one of my mother's old friends who after flitting Vienna at Anschluss found herself not long after in a pub drinking with Dylan Thomas. Wonderful place, Bloomsbury!

    The real menace is uncertainty. Uncertainty drove the German nation into the arms of the Nazis who then used the economic power of their Reich to abuse all of Europe. It is uncertainty that causes the people of China to save their money for fear of sickness and old age: the proverbial rainy day. Are they wrong then? Not in my book.

    It is the uncertainty of being in debt which is the nightmare of the West. Can we afford the next payment? What do we go without if we can't? These questions are scarcely spoken when the debt is being enjoyed and repayment just some time tomorrow. If you choose not to be master in your own house then live with the subsequent uncertainty. Now people complain, shout in the street, break windows but what use is that? Is our problem really a lack of will-power, or a failure to understand the simple realities known to even the meanest peasant?

    I often recall the period in the mid to late Nineties when the off-shoring of production was in full swing. Factories around here were closing down fairly regularly as brand owners took their manufacturing needs to China. I once asked a friend who had been training managers in Malaysia what was causing all this tumult. He told me it was because people and land was so much cheaper there: no other reason than more profit margin.

    The alarm bells rang in my head as the landscape I knew was shifting, but nobody else was seemingly bothered so I had to be wrong and I was told I was wrong. We were told this was economic development and we would certainly build a stronger economy in financial services and other unique markets as a consequence.

    I have no objection to improving conditions in other countries but why should it be done at the expense of people here? So the unemployment rate was allowed to just increase with the associated pain mollified by improved welfare payments. Wages stagnated and expectations declined. Is this what was meant by a flexible labour market? I expect so. Uncertainty for the lower orders but hope they enjoy the cake!

    We all know what happened next, the economic model we had chosen to build as it was going to continue forever, imploded and without the conscription of the taxpayer as the bank of final resort the entire economic structure would have disappeared down the debt-hole. Now we really do know uncertainty and personal savings once again are growing. So we are all Chinese today!

    The truth is that the West lost the plot just as it did in the Thirties. Even with all the professors, doctors, economists, historians and journalists studying the Thirties we managed to make history repeat. Am I to become like my great-grandfather, in 1931 he was a Billingsgate trader, a churchwarden in Bethnal Green and then two years old than I am now, looking out onto a barren landscape of poverty and hopelessness? I fear so. When his wife died he retired to the country as he couldn't stand the growing dereliction about his native streets.

    The solution is not to be found in academic ideas manipulating the macro-economic model but in restructuring the economy, finding a way to bring jobs back into our economy so that the uncertainty can be dissipated. We are not going to fiddle our way back to prosperity we have to go and do prosperity. Muck and brass! However, that is no quick fix to be found at a conference of the powers of this world. It can only come from the simplicity of everyday life as we find it.

  • Comment number 28.

    16. At 3:32pm on 12 Nov 2010, jauntycyclist wrote:

    "They really don't care if the capitalists society falls. it would 'prove' their ideology"


    Do you understand that China is implementing to opposite of Hayekism? Do you understand that China is essentially implementing Fabian Socialism, which was a British invention (see HG Wells, the Webbs etc)? Do you understand that I say you are confused because you keep contradicting yourself and that it's this written behaviour which shows others that you don't really understand what you are writing about? do you want to stay confused? This is meant as helpful constructive criticism.


  • Comment number 29.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 30.

    Paul might be good at economic reporting and writing concise prose, but tabble analyses (genetic) behaviours and history and backs up much of what they write on here with referenced info/papers and sound logical analysis. It all sounds so plausible.

    Have you ever read anything by anyone else with such a broad base of (analysed) history and knowledge?

    BUT...what if what tabble writes is true!....what should/could Western society do about such predatory behaviour?

    Is it too late to do anything about it?

  • Comment number 31.

    Duvinrouge and others above cite Marx's analysis of the consequences of the "tendency of profits to decline over time under capitalism". This prediction is often assumed as an historical fact by many commentators. However it is a myth.
    The reality is that in the United States Nonfarm Business Sector, Labour' Share of Current-Dollar Output has fallen fairly steadily from around 65% during the period 1945-1980 to 57% today. That is, the capitalist's gross profit share has risen from 35% to 43% - which has underpinned the longer term rise in stock prices in the USA since the 1950s.

  • Comment number 32.

    30. At 5:37pm on 12 Nov 2010, DebtJuggler wrote:

    "BUT...what if what tabble writes is true!....what should/could Western society do about such predatory behaviour?

    Is it too late to do anything about it?"


    Exactly. Imagine an egregious affirmative action group strategy operating which only survived and benefited those taking predatory advantage of others via the latter being kept in the dark by people censoring or censuring those who exposed the modus operandi. How would that ever change in the interest of fairness if all one had to do to keep people in the dark was complain about the exposure because it caused offence? Imagine robbers getting away with their offences because being caught out and prosecuted really hurt their feelings. When complaining about their persecutors, all they'd have to do is omit all reference to their antecedent offending behaviours, and hey presto, instant victimization and exoneration.

  • Comment number 33.

    In #29, tabblenabble02 wrote: "Laws in the 70s made it next to impossible to select on the basis of native ability."

    I was thinking of just this thought when I read your post.

    In the USA, schools started becoming useless around 1970. Many people laugh at the Tea Party's intelligence, but it was the liberals who destroyed our educational system. What goes around, comes around.

    When I was in grammar school, there were a number of Italian boys who had flunked-out of their usual class and ended up in mine. They were almost all bullies, as stupid boys usually are. Today, stupid kids are not flunked; they are just kicked upstairs.

    I remember a few high school students who were simply useless -- white, by the way -- but their parents sued the school district and successfully lowered the standards so their precious darlings would not have to suffer being labeled as stupid. That was the beginning of the end. After that, classes became meetings where only touchy-feely subjects were discussed.

    Today it is virtually impossible to fire certain minorities because of Title VII (civil rights) laws, so companies resort to mass lay-offs, eliminating everyone they do not like in one pass. These groups have large numbers of older people in them, because age is not a priority to liberals as race and religion are. And I am convinced that this plays a major role in why so many companies have been outsourced, as managers could not control American workers but they sure as heck can control foreign ones.

    There were some recent stories on how black students fail to obtain a high school diploma 40% of the time. Political correctness demands that people try to explain this in terms of culture or diet. Yet if there is a real genetic difference between blacks and other races, we are actually doing them a disservice by ignoring the issue. I firmly believe that the USA (maybe the UK) should implement Germany's system of splitting students into trade schools and university groups. Let's stop pretending that everyone is the same while Japan and South Korea educate their students very well and manufacture products the world wants.

    American Heritage magazine published an article years ago that noted how boys from broken homes tend to be violent and stupid. The magazine was actually looking at boys from mining camps in the 1800s, but the parallel to today still holds true. 1/3 of white babies born here are out of wedlock, but 2/3 of black babies born here are out of wedlock. And these percentages are increasing. This is a recipe for disaster, as we are seeing with the inability of the West to compete with the East.

  • Comment number 34.

    nice piece, Paul, a trifle long but to summerise it's sounds as though history is about to repeat itself with some of the players coming from different positions but basically the main threats are one of greed, national paranoia and tring to cobble a communique that needs months spending on it rather than the Friday flight home to see the kids....

  • Comment number 35.

    Fair play to Tabble if English isn't a first language: s/he's having a good go, nevertheless his/her syntax is horribly mangled.

  • Comment number 36.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 37.

    An interesting and thought provoking review - although I do have a problem with its main and no so prominent conclusion:-

    'Any return to competing trade blocs would shatter the modern world just as completely as 1914 shattered the world of coffee, cake and coloratura that nurtured Stefan Zweig.'

    The problem:

    'competing trade blocs' ... is exactly what we (the UK) have now!

    East v West
    Benelux - v - pigs
    BRIC - v - Euroland

    We're already there Mr Mason ... the time for talking is in the past ... if China agrees to take in more exports globally how much of these additional Chinese imports would be taken in from the UK?

    I'll tell you ... very little as, overall, Britain is 'comparitively uncompetitive' and even if China does 'cave in' and agree to world demands to 'play trade fair' ... Britain is till going to lose out as it is not ready to service e.g. China's doesmtic market as the Chinese have said this week. Britain is year's away from being fit for purpose for moving companies into China and competing with other foreign competitors for this trade...partly because of Chinese and other protectionsism and other barriers to entry.

    Britain's main drawback is its comparitively lazy, over-paid, over consuming population that is generally obsessed with human/employment rights when the aggressive competition completely ignores human/employment rights and keep their own production costs very low.

    Britain cannot now compete with this ... talking nicely to the Chinese and others does not work in terms of our Coalition govt plans for them to stop their protectionism and naively open up their own economies to UK exports and so as to be 'wide open' to ineternational trade, like the UK.

    This is naive ... human/employment/equality rights are a 'double edged sword' though ... Britain and the EU can morally make a very strong case for 'principled protectionsism' against those who flout the rules of fair trade and productive morality.

    Sanctions are required to enable Britian to 'do better' (Britain is never going to 'recover') as painful and as difficult as it sounds ... and import tariffs are quick and very effective and can raise a lot of much needed revenue for investment in the UK domestic economy ... higher interest rates with protection for UK doemstic mortgage holders ... can be equally as good as a reduced £ GB excahange rate and low ineterst rates... if a real strategic approach is required. It's all a question of how the UK economy is 're-structured'.

    Having high interst rates and attracting and managing foreign cash for a sustainable Britian and not a massive UK sell out ... could be a better plan of action for the UK ... it all depends on 'structure' and 'strategy'.

    The UK needs real thinking outside of the box and to pursue its own course ... but to think that the UK can simply ask others to behave properly and open their own markets to UK exports so that the UK can 'do better' ... is naive at the extreme.

    The time for talking has passed ... this is the time for action ... the UK government must intervene ... there is no market driven solution to the UK's plight - delay means that the UK sinks further into the mire of economic mayhem and stagnation.

  • Comment number 38.

    33. At 6:43pm on 12 Nov 2010, saucymugwump wrote:

    "American Heritage magazine published an article years ago that noted how boys from broken homes tend to be violent and stupid. The magazine was actually looking at boys from mining camps in the 1800s, but the parallel to today still holds true. 1/3 of white babies born here are out of wedlock, but 2/3 of black babies born here are out of wedlock.

    And these percentages are increasing. This is a recipe for disaster, as we are seeing with the inability of the West to compete with the East."


    Exactly. Many on your side of the Atlantic (well before ETS in feb 2007) wrote about the imminent dire economic consequences of ignoring these differences, perhaps most comprehensively Herrnstein and Murray in 1994.

    The problem is that many people associate 'liberal' with the left instead of the libertarian right. It's the right-wing libertarian which causes most of the trouble here, as their pseudo humanistic philosophy of Rawlsian Social Justice suits their free-market interests making out that genetic individual differences aren't important - this pretence just makes it easier for corporations to treat consumers as if they are all equally cognizant and thus equally responsible for their 'choices'.
    They aren't. It's licence to exploit and that's why we are seeing all these problems today.

    We've seen where that went with the predatory lending and ARMs etc, and we can see it happening elsewhere too, even in The Third Sector. Unless more people see through this faux humanism for what it really is, more and more people will be exploited like children, which will just exacerbate the already massive wealth gap. Many of those advocating re-distribution of wealth only do so only because cynically they know that in handing out benefits in that way to an ever growing skewed demographic the money soon finds its way right back into the corporate coffers of Tesco,. Wall-mart, Top Shop etc which are probably now securitizing their future revenue steams happily knowing that there's a steady source of income from compulsory tax collection.

    Those who censor explications like this are, in my view, colluding with human predators. In doing what they do, they don't protect the vulnerable minorities which they claim they care about, they just want to look good to others for its own reward!. It's predatory narcissism, nothing less..

  • Comment number 39.

    "35. At 7:24pm on 12 Nov 2010, SeanBroseley wrote:
    Fair play to Tabble if English isn't a first language: s/he's having a good go, nevertheless his/her syntax is horribly mangled."

    Or might it be that what's being said requires you to read in a very different way to how you have been taught? Reading like thinking is a treacherous idiom (verb) of propositional attitude.

    See Wittgenstein and Quine on The Tyranny of Language.

  • Comment number 40.

    Ho-Lee-Kow! (It's a Chinese cow by the way!)

    This is from one of tn02's earlier (Wiki) links...


    'In December 1977, when uniform national examinations were reinstated, 5.7 million students took the examinations, although university placement was available for only the 278,000 applicants with the highest scores. In July 1984, about 1.6 million candidates (30,000 fewer than in 1983) took the entrance examinations for the 430,000 places in China's more than 900 colleges and universities. Of the 1.6 million examinees, more than 1 million took the test for placement in science and engineering colleges; 415,000 for places in liberal arts colleges; 88,000 for placement in foreign language institutions; and 15,000 for placement in sports universities and schools. More than 100,000 of the candidates were from national minority groups. A year later, there were approximately 1.8 million students taking the three day college entrance examination to compete for 560,000 places. Liberal arts candidates were tested on politics, Chinese, mathematics, foreign languages, history, and geography. Science and engineering candidates were tested on politics, Chinese, mathematics, chemistry, and biology. Entrance examinations also were given in 1985 for professional and technical schools, which sought to enroll 550,000 new students.'

    ---------------------------------------------------

    'We've' already lost the economic war!


    It's a fine time to be a Socialist!

  • Comment number 41.

    In #35, SeanBroseley wrote: "nevertheless [tabblenabble02's] syntax is horribly mangled"

    I don't agree.

    He does seem to be overly interested in Fabian, but maybe he does not appreciate the other teen idols of the 50s and 60s, e.g. Ricky Nelson, Frankie Avalon, and Elvis Presley.

  • Comment number 42.

    Great article. Great to read a load of posts stating that the British need to stop moaning, roll their sleeves up (and maybe the first layer of fat) and get on with it. Education is key, and within that maths. This takes hard work, whereas the Brits are more keen on "expressing themselves" through the medium of song.

    I could put a load of quotes from other posters but it's late and I'm going to learn some more of a new programming language.

    As Paul says:

    "Meanwhile the west has to become more industrial, its consumers have to save more and become less obsessed with buying cheap tat at large supermarkets."

    Brits have piddled away our advantage bequeathed to us by prior generations who won this with pure hard work. Turning around education takes years. Unless you are a genius, parents play a huge roll. As stupidity is now endemic we have to somehow turn this oil tanker around. This means educating kids using a nation of dullards where many teachers are useless and so are their parents. This is a mammoth task. I can't see us doing it.

    To say that China isn't playing by the rules is so childish I could almost slap people when I hear this. This is the human race. There are no rules per say. Either you are a hegemony and people willingly follow (America 1960s) or you rule at the barrel of a gun. The latter is usually post-hegemony and doesn't last too long.

    Either we lower our imports, which I don't think would lower our living standards as the tat from China is meaningless, but my countrymen disagree. Or we work harder and produce more to trade to buy tat. We can't have our cake and eat it.

    Finally, I'd like to start a business but employing people seems like more of a commitment than marriage. I'd be scared of firing someone in case I end up loosing all my savings (before Merv erodes them) in some ridiculous legal battle. Who always goes home to a massive house in the UK? The lawyers, fed by our complacent, whining population.

    Sorry for the rant, but I'm sick of all this moaning. This outcome has been nailed to the wall for 10 years and if you thought we could run an expanding deficit forever, or didn't think about it at all, words fail me....

    ps http://en.wikipedia.org/wiki/The_X_Factor_%28UK%29#Series_averages

    pps if you've not got a job get down the library and teach yourself IT. Most support people are rubbish at it. I reckon if you can read you can get a job in 3 months tops. Before they close the library down.

  • Comment number 43.

    In #38, tabblenabble02 wrote: "The problem is that many people associate 'liberal' with the left instead of the libertarian right. It's the right-wing libertarian which causes most of the trouble here"

    Speaking for my side of the pond only, there are some similarities but also some stark differences.

    Liberals and libertarians both believe that all people are the same and have the same potential.

    Liberals and libertarians both believe in unlimited immigration.

    Liberals and libertarians both believe in gay marriage.

    Liberals believe that corporations must have limits in the way they treat employees, while libertarians want to return to the 1800s when employers could treat people as disposable.

    Liberals believe in government regulation of Wall Street, while libertarians are vehemently against it.

    Liberals believe in building mass transit systems, while libertarians are vehemently against it.

    Liberals believe in shared protections like fire departments paid through taxes, while libertarians want to charge people per fire after the fact or mandate that people buy private insurance. We had a cartoon in a newspaper showing a house on fire, fire fighters arriving to extinguish the blaze, and a libertarian saying "No thanks, I'm a libertarian."

    Liberals believe in shared retirement plans like Social Security, while libertarians believe that it is one of the worst scourges inflicted on mankind. I've actually had a few libertarians admit this to my face.

    Liberals believe in a common educational system paid through taxes, while libertarians believe that each individual is responsible for educating himself, including paying the cost for that education.

    Liberals believe that giving special rights to minorities is the best way to address injustice, while libertarians (and just about everyone except liberals) believe in "equal rights for all, but special rights for none."

    I have heartburn with many liberal views, but I disagree with almost everything libertarians stand for.

  • Comment number 44.

    In #42, Ben wrote: "if you've not got a job get down the library and teach yourself IT. Most support people are rubbish at it. I reckon if you can read you can get a job in 3 months tops"

    Things must be different between the USA and UK. Every IT job here requires a laundry list of Microsoft, Cisco, and other certifications. The rare programming job that has not yet been outsourced to India requires a laundry list of experience, not possible within a few months.

    HR departments never actually read resumes; they just have a script check for certain buzzwords. You will be quizzed mercilessly at your interview, so if you lie and include every buzzword in their ad on your resume, you might have a problem. Some companies, with Sun being among the worst, expect employees to be geeks with no life whatsoever. One Sun software engineer told me that, at a party, some Sun geeksters actually proposed that they work on use cases (software design).

  • Comment number 45.

    The word libertarian is suspiciously similar to the word liberal!

  • Comment number 46.

    Some don't realise just how extensive the Anti-Comintern Pact (note, it wasn't anti Russian in fact, Stalin wanted rid of the Comintern too). It wasn't just Germany, Italy and Japan in the Pact, it included Hungary, Bulgaria and Rumania (and others) against what was seen to be a major economic threat of anarchistism. It wasn't religious anti-semitism or a cruel persecution of innocent Jews, it was anti libertarianism. But read below how some today would have you talk of Nazi 'occupied' Hungary when the ADL defends Soros against a recent remark from Glen Beck. They tell untruths. Just like the CH4 programme did last night about the economy.

    They intentionally cause confusion. It's what anarchists do. Lots of people reading these blogs believe lots of things which are not true, and never check their core assumptions. Why?.

  • Comment number 47.

    42. At 10:29pm on 12 Nov 2010, Ben wrote:

    "Brits have piddled away our advantage bequeathed to us by prior generations who won this with pure hard work. Turning around education takes years. Unless you are a genius, parents play a huge roll. As stupidity is now endemic we have to somehow turn this oil tanker around.
    This means educating kids using a nation of dullards where many teachers are useless and so are their parents. This is a mammoth task. I can't see us doing it."


    Which bit of the fact that intelligence is nearly all genetic don't you understand? As it's genetic and the gene pool has been dumbed down through a skewed birth rate (i.e differential and dysgenic fertility plus low skilled immigration exacerbating the problem), what is there to be educated?

    The point which you and others need to grasp is that education is just a behaviour selection and directing process. You need to think about that carefully. You don't understand. Many don't understand. They have been badly 'educated'. They think you can pour education into 'plastic' brains. They are not 'plastic'.

    You need to learn to think, read and write a new way and that requires a major change from what's familiar... the entire concept of 'mind' is at issue..

  • Comment number 48.

    saucymugwump - I'm not talking programmers here - that takes longer. Helpdesk.

    But to take up your point, which I accept is really hurting US programmers. How are the Indian guys getting the jobs? Sure they get cheaper wages, but they can do the job. 2 useless programmers does not produce working software. Skilled tasks don't scale. Would you rather have a brain operation from one trained surgeon or 10 laymen?

    How do they get the jobs? Are they born with this? Do Indian schools have more computers than US or UK schools? Or is it that they are learning more by working harder? (I have to say a lot of Indian programmers suck but so do US / British ones, because it's really hard).

    The rest of the world is educating it's young and we have to be better than them if we want to retain our bigger slice of the pie. If we are cool with less of the pie then no problem, but I think my British friends want to go out on Friday instead of studying +and+ have a big tv. My kid stamps his feet when he wants pudding after leaving his main course. Here I'm like the Chinese - he can stamp all he wants, I couldn't give a monkeys. Eat your main and you can have pudding :-)

  • Comment number 49.

    One for the UK students...

    THE STUDENTS, UNITED, WILL NEVER BE DEFEATED!

    PS listen to the words (very carefully)!

    Muse

    http://www.youtube.com/watch?v=w8KQmps-Sog

  • Comment number 50.

    tabbie - I'm educated, I've heard you say this before and I disagree. I usually skip your posts but as this appeared at the bottom, I'm gonna reply to this one. You didn't reply to my post last week when I asked for specific evidence of this that includes poverty weighting. You gave me a lame DoE link to about 30 docs.

    You always post with statements like "you don't understand" etc. Does it ever occur to you that I think you are wrong? Perhaps you have a gene missing that assimilates other points of view and so I shouldn't be complaining as it's not your fault. Ok you owe me 5 minutes as I'm convinced this post is a total waste of time.

    I'm now going to clean my teeth.

    ps how do you find time to post so many times during the day? Are you unemployed, retired or do you work in the civil service?

    pps whilst we are swapping brain mumbo jumbo cognitive theories that have no place on an economics blog and that nobody ever replies to, try this on for size - maybe read it in front of the mirror:

    http://en.wikipedia.org/wiki/Dunning-Kruger_effect

    Actually - I just read some of your stuff up the page. Don't bother replying.

  • Comment number 51.

    debtjuggler - lol. read the comments to see why the west is doomed. First education, then ideology.

    eg

    "luv it it rocks and its kinda sums up my life just with out the giants cause there a group of boys at my school who think they r the ledars of the rest of use boys but me and my friends will fight for r freedom we will be fighting them on monday 15th wish me luck"

    The revolution will be televised!

    I wish I could post every comment. Follow that link, then go to http://www.lamebook.com if you are still thirsty.

    50% at uni is insane. As usual once the government "give" something people say it can't be taken back. The education arms race in the uk is insane. Mundane office jobs now require degrees, simply because they can ask for them as everyone has them. If you don't have a degree you are in the bottom half if 50% go to uni. So people have to go just to get an average job that will mean they struggle to earn to pay back the debt. They would be better off if only 10% went, then most jobs wouldn't stipulate a degree and so people could get on with a job that suites them.

    Labour's "everyone wins" sounded great but when you see a meritocracy devalued forcibly it follows that people who are not in the top 10% actually loose out more by being forced down a route the government think is best for them by creating artificial demand through subsidy / social engineering gone wrong.

  • Comment number 52.

    Sorry....this one’s just a great song!

    http://www.youtube.com/watch?v=qhduQhDqtb4&feature=related

  • Comment number 53.

    In #48, Ben wrote: "How are the Indian guys getting the jobs?"

    I'm glad you asked.

    My government created a system of work visas years ago. The two most important for this subject are H-1B and L-1 visas. H-1B visas were originally meant to bring in highly skilled workers, possessing knowledge that simply was not available here. I have no problem with that. The original idea was to bring in people with doctorates. H-1B visas were capped, but L-1 visas were not. The H-1B cap is currently set at 65,000 per year. Both visas are responsible for hundreds of thousands of foreign workers in total.

    On a related note, the Times Square bomber originally came to the USA on a H-1B visa.

    But a funny thing happened on the way to the employment office. Microsoft and other companies realized that they could bring in, not just doctorates, but people with just a B.S. in engineering. A B.S. in engineering is not that unique here; I have one. Microsoft starting laying off American engineers and started bringing in Indian and Pakistani engineers, paying them significantly less in the bargain. Just recently Microsoft laid-off 5000 American engineers, with Bill Gates and Steve Ballmer appearing before Congress to plead for a higher H-1B visa yearly cap. Coincidence? I think not.

    At the same time, a few Indian companies realized that they could make money on the situation. Wipro is probably the largest, but they are not remotely the only company. They actively solicit for work with the sales pitch that their employees work cheaper than Americans, and that is true. I have personal experience with Wipro. Some of the problems are:
    - India is 12 hours or so different than the USA, so communication is difficult. Wipro had a few select engineers with whom we would communicate.
    - The software industry learned a long time ago that good communications lets one avoid design problems. Being unable to sit with the actual engineers leads to mistakes.

    And it's no picnic for the Indian/Pakistani engineers, either. The visa is only good for the original employer. They cannot quit to work for another company, so the company has lots of leverage over them. They tend to work longer hours to please their boss, which makes American workers look bad by comparison.

    Many American workers have been told that they would be laid-off, but before that they were to train their Indian/Pakastani replacement. No, I'm not kidding. Since this transition period was weeks or even months long, most people put up with it because they thought they'd easily find another job. They were wrong.

    By the way, H-1B and L-1 visas are used for programmers, IT personnel, and many other specialties. The USA has a nursing shortage because schools pay very poorly, so good instructors are difficult to find. Many politicians have declared that we should import nurses from the Philippines to fill the gap; not once do they ever think about improving our educational system.

    The American worker is screwed because all politicians like H-1B and L-1 visas. Democrats like them because they are in favor of unlimited immigration on moral grounds. Republicans like them because it enables companies to hire at the cheapest possible wage. Libertarians and the Tea Party like them because they want to return to the 1800s when workers were disposable.

    Ben wrote: "Would you rather have a brain operation from one trained surgeon or 10 laymen?"

    American management does not appear to understand this concept. Like the average Walmart shopper, they are only interested in the price.

  • Comment number 54.

    #31 goldchrisevans

    I agree.
    Labour's share of the cake has declined.
    Read what I wrote again. I wasn't arguing that the tendency of the rate of profit to decline explains the boom & busts of the 20th century.

    Remember there is a big difference between the rate of profit recorded by capitalists & the rate of surplus value.

    Because a capitalist buys labour (v = variable capital) & means of production (c = constant capital), he sees profit as being s (surplus value) divided by the sum of variable & constant capital.
    Whereas in reality profit only originates from labour, i.e. the difference between the amount paid for labour (wages) & the amount of value produced by labour - the difference being surplus value.
    The rate of surplus value is s divided by v.

    So, if you are still with me, there are three categories, v, c & s.
    As capitalism 'advances' c grows, absolutely & as, most likely, a %.
    For the rate of surplus value (the true rate of profit) to not fall, the rate of exploitation needs to increase, i.e. capitalists must get a growing share of the cake (if the cake isn't growing fast enough).

    But between 1945 & about 1965 the cake was growing fast due to cheap energy - mainly oil.
    The labour force was growing - peasants around the world become wage earners (the ex-colonies) & women were brought into the factories.
    The typical family brought in two wages.
    v, c & s were all increasing in absolute terms.

    Today we are in a different situation.
    The price of energy has increased - the easiest oil has been got(peak oil).
    This means the rate of exploitation (s/v) is going (will be going) into reverse as the means of subsistence become more expensive (in otherwords a greater proportion of labour time will need to be devoted to producing the means of subsistence than producing surplus value).
    This in turn makes new investment more difficult & so you don't get the productivity gains that in the past have increased the rate of exploitation to offset the increase in the organic composition of capital (c/v).

    So the tendency of the rate of profit to decline due to increases in capital in a world where the labour supply isn't growing (or at least not as rapidly) becomes relevant.

    But as I was trying to point out, it is also (& perhaps more so) the growth in unproductive labour & fictitious capital that explains todays crisis.

  • Comment number 55.

    Great post Paul, but I do get the sense that we are going over old ground here.

    I say personally because it is still very important that your kind of analysis is 'out there' raising general awareness, and in order to do that you have to keep banging on about it in the context of the news of the day.

    Personaly I am getting rather tired now of observing the global economic car crash unfold in slow motion, but as much awareness as can be raised the better.

    The uncomfortable truth is that if you want to truely understand all this and truely put forward a solution which will avoid it happening in future you have to go philosophical in seeking answers which will take you right to the heart of what a human being is. Most people are afraid to do that and will do anything to avoid looking into that place (torture, war , genocide etc).

    I suspect Zweig understood that, maybe that knowledge even prompted him to take the action he did. But it is a different world now to the one he inhabited through communication media and a different path looks possible, but unlikely on current evidence.

    Is it just me, or if you look closely at the G20 photo in your post and swop the title in the back ground from ''The seoul Summit 2010'' and replace it with 'Asylum annual photo' the body language in the context of what they are supposed to be doing suddenly looks in alignment.

    Why are these nutters grinning and waving?

    Swop the suits for Togas and the waves for fiddles and you have Rome 64AD.

    At least DC (and a few others I do not recognise) have the decency to look embaressed about it all / refuse to engage in it.

  • Comment number 56.

    saucymugwump - they let the bean counters (the lunatics) run the asylum. These people view employees as commodities and don't understand quality. However some Indians are great programmers. They do a great job.

    I taught myself to program, and so can anyone else. Anyone who already knows the basics can certainly take themselves to the next level and get a better job. Just sit down with a book and read. Maybe for months. IT is an amazing opportunity. All you need to write a program 1M people use is a crappy laptop. That is your steel mill. The Marxists would love it - you own the means of production. Plus the internet has more good knowledge on computing than any one person could ever read.

    I hear you on the race to the bottom. This is the wrong way. But until your (and my) countrymen realise that cheap tat isn't the most important thing in life, we make that Faustian pact.

    The internet allows us to learn nearly any subject to degree standard in our free time for free. We can improve ourselves, but XFactor is on too. The dilemma is so hard! Like overeating, the west cannot resist TV.

    http://www.guardian.co.uk/media/2010/may/04/thinkbox-television-viewing

  • Comment number 57.

    saucymugwump - also IT employment is only going one way. Up. This will save good engineers:

    http://www.gotw.ca/publications/concurrency-ddj.htm

    It's a great place to work. Over the next 10 years robotics will replace millions of semi-skilled factory workers, which is going to be bad for them but not so bad if you work in IT. I'm not making a moral comment on this, simply that it will happen and if you work in IT you are on the right side of the fence.

  • Comment number 58.


    "You always post with statements like "you don't understand" etc

    That's because you don't. It's true.

    "Does it ever occur to you that I think you are wrong?"

    No, because I really do know what I'm talking about and I know for certain that you don't from what you write. I'm teaching you something, but you just don't know how or when to listen. You are obviously very young.

    "Perhaps you have a gene missing that assimilates other points of view and so I shouldn't be complaining as it's not your fault. Ok you owe me 5 minutes as I'm convinced this post is a total waste of time."

    No, you keep showing us that you don't know anything about this subject (which is enormous). I've given you some clues, so you should go and look up what JadedJean, Statist and others have listed in the past.

    There are lots of references, all you need to do is go and do some
    work Ben, or...... you'll ever remain ignorant, cocky but completely deluded, and you'll write and think fluent nonsense like Harry Potter without every knowing how and why. Seriously - narrative flows easily because the authors are completely deluded - that's true you know..

  • Comment number 59.

    tabbie - It's Pauls blog. If you want to educate why not start your own blog and see how many people read it? As you have so much to give, have the courage of your convictions.

    Setting up a blog is free and easy. I await the link and look forward to you posting your own content, which usually has nothing to do with the topics on this blog, in your own space.

  • Comment number 60.

    one of the modern world's greatest economists:

    http://www.youtube.com/watch?v=9QpD64GUoXw

    Please.

  • Comment number 61.

    Sorry but you are a total pseud. Your gene theory doesn't get past any serios consideration of sceptisism to causal chains ( which also sank Quines epistemology ) and you quote Wittgenstein without tackling his paradox at ~201 in " Investigations" re interpretations, which again sinks your (Quinian) metaphysical realism.

    You can fool some of the people some of the time, but at heart your a fraud, which I guess explains the multiple changes of identity.

  • Comment number 62.

    The problem in the present crises is the intellectual and cultural shadow of the 30s hanging over us. In that, instead of focusing on the present crises and its historically unique components, policy makers,pundits et al are obsessed with fighting the last war, the depression of the 30s.

    Fighting this crises by deploying intellectual tools created with the 30s in the mind eyes, can only make the present crises worse. The 30s were a crises of the Gold system, and this is a crises of the fiat system.

    Its a failing of the human psyche to create false dichotomies of problem and solution and to orientate ideologically thereby, so that we fail to see that any solutions come with their own problems.We create a solution to problem x at time y, and then become married intellectually and ideologically to said solution long past its usefulness or indeed its relevance.

    The one thing that needs to be done in the present situation, is for the 30s to be completely and utterly forgotten. Its mostly irrelevant to the situation we see now as the situation then was so utterly different.To orientate our selves intellectually thereby can only create more problems.

    Ben Bernanke is the living embodiment of the above.

  • Comment number 63.


    "59. At 09:31am on 13 Nov 2010, Ben wrote:
    tabbie - It's Pauls blog. If you want to educate why not start your own blog and see how many people read it? As you have so much to give, have the courage of your convictions."


    These blogs are for comments, not for Paul to parade. Otherwise he'd just write feature pages as other journalists do. If you don't like some of these comments, perhaps you should ask why? Your remarks are Potteresque. That way of writing what you think you are good at, and there are many like you, but what decides what is good?. For some, it's not about reading or writing 'interesting' or well written blogs or comments, it's about reading or writing what's true. There's an important difference.

    You need to learn something about the vagueness of the personal (the domain of psychological states - see Skinner's "The Operational Analysis of Psychological Terms (1945) Psychological Review, 52, 270-277 Please don't reference any more Kahneman type material as it is all tribal 'translation' into another language game of work was done elsewhere.

    Instead, watch The X Factor auditions (public ritualistic humiliation by narcissists of narcissists) and you'll see lots of people who clearly live in their own deluded world but who still think parading is what matters not their audience's views. It's child-like and shows one something a little worrying about the nature of human behaviour. In fact, when lack of talent is fed back to many of them (and the same happens to the finalists week after week if you look closely, often with bizarre booing from the studio audience), some dismiss or even abuse the judges! It's the same on 'Strictly'. This is how narcissism works and it highlights something which you should take note of (the programmes have softened up recently as it has become more evident how personality disordered some of the participants are, and there is a new Equality Act 2010). Narcissists lives in a magical world where only what they imagine to be true matters, others are just there as sources of positive supply (a bit like doting parents).

    My point here is that we now have a major demographic problem where the prevalence of this problem behaviour (arrested development as lower IQ) is seriously affecting our economies across the liberal-democracies and this translates into rising crime and other indices of social instability, but you don't see the relevance of my highlighting instantiations of that here in this blog, or in C20th history? Why is that do you think? Why is it that you don't see the connection with current events? It's been pointed out by some here for years, way before the 2007 crash in fact..

    "Setting up a blog is free and easy. I await the link and look forward to you posting your own content, which usually has nothing to do with the topics on this blog, in your own space."

    It has nothing to do with the content as far as you can tell. That that last self-referential part is precisely what you should focus upon I suggest. Look back at the band of robbers allegory I used as it's about a convenient lack of self-awareness which really happens. If and when you do, just bear in mind that for some, this would halt them in their tracks and their over-confidence would take a helpful knock, as the point is about chaining in behaviour. That's self-awareness putting the brakes on. That's what's lacking in children, they can't reason beyond the now. It's true for many females too which is why they don't do well in (avoid?) maths logic, engineering etc, and hence the 'arrested developed' - it comes across as self-centredness.

    I could say that I look forward to you acquiring a better grasp of what you're reading, and so engaging more with what's being pointed out, but I don't think you will on the basis of recent posts - at present you appear to be far too interested in how you appear to your imagined audience. Truth, however, is not established by social convention. I hope I am wrong. Sincerely.

  • Comment number 64.

    "61. At 09:31am on 13 Nov 2010, supersnapshot wrote:
    Sorry but you are a total pseud. Your gene theory doesn't get past any serios consideration of sceptisism to causal chains ( which also sank Quines epistemology ) and you quote Wittgenstein without tackling his paradox at ~201 in " Investigations" re interpretations, which again sinks your (Quinian) metaphysical realism."


    It stands up to intelligent empirical analysis though.

    Now, which do you think matters? Your very idiosyncratic personal views, or those of the scientific community?

    I suggest you read the entire pdf referenced above and then post again with your views. You clearly don't understand who Quine was, and you certainly don't know who I am, nor should you want to, as the purpose of anonymous posting is to try to make you focus upon what is written, i.e. the ball, not the player. At times that is hard to differentiate, rue, but try it.

    As I keep saying, much of what most people here believe to be true, is in fact almost certainly false (see link to Avalon Project at Yale viz the 30s), and whilst it's worth pointing that out these massive untruths in most people's best interest given the current state of our economies and people's professed interests in this blog, many like yourself, will I suspect, continue dismissing what's true, simply because it doesn't fit their preconceptions. My question for you (and others) is, hopefully after a little serious reflection on the material, is: Is this behaviour of yours good for you or for anyone else? Can you conceive how anyone or any group might politically and economically benefit from serial propagation of such untruths? Does such advantage show up in unequal frequencies, and remunerations? Is that sort of analysis not rational? Or is it proscribed? If so, in whose interests is it proscribed?

  • Comment number 65.

    Wittgenstein had a good word for the above - nonsense.

    I suggest you get your own blog and stop clogging this one up with your nonsense.

  • Comment number 66.


    I am reluctant to get drawn into the tedious debate about genetic ability that mars this string: and which is entirely beside the point. However, it is worth saying that for any human ability (lets say running) there will be people who are very good at it, some who are no good, and a range in between on a normal distribution curve.

    Whether different populations have different innate abilities is a moot point - unless you are intending to then use it to discriminate between them. Othwise, it serves no useful purpose.

    I choose not to discriminate other than on the grounds of ability (pace Tom Lehrer)and note that in any of the groups or nationalities mentioned so far there are people across the whole spectrum. Whether you can then effect a "red shift" in terms of overall ability through education etc is another issue.

    On the real point of this blog, there are obvious parallels between the current situation and the 1930s and the increasingly nationalist tenor of the public debate - and the emergence of groups like UKIP etc - is one. The quote from Mr Zweig is great on this.

    The challenge we face as people is to now find a solution to these problems that is based on something other than nationalism, protectionism and xenophobia. If not then we will not have learned from the 1930s and may be doomed to repeat the 1940s. I don't know what that something will be - but I know that it will not be founded on efforts to discriminate between ethnic groups.

  • Comment number 67.

    If we were all Trekkers then the planet would be a better place.

    Admittedly, we wouldn't get much done as we would all debating whether Romulans are better than Klingons, stating how much we are in love with Seven of Nine and arguing who was the best Captain.

    I think Scotty would have something to say about the global economy and the current Eire crisis.

    "She cannae take any more Captain - she's gonna to blow!"





  • Comment number 68.

    Why genetic change to a population is critically important and almost everything else isn't, is because once one goes beyond a few variables, non-linearities proliferate leading to massive errors in reliable prediction, and whilst this licences some to pontificate in realms which amount to fluent 'narrative' (great for journalism but not for scientists) in libertarian economies, which by design leave market-forces to determine value, it's not at all clear that there is an effective state apparatus to effect change - it's ever more deregulated. That's what freedom means. Anarchism, without rule. "Libertarians unrule".

    Where Paul is right is where he says that in the past there was a transition from currency to trade to military war. Just as savers don't like having their assets devalued through inflation (when money injected into the economy isn't asset backed, but just printed it devalues the value of the currency) those abroad holding another country's debt don't like it either, as it means their savings are devalued. They see this as a cheat. When diplomacy and trade wars fail, they have in the past send in their bailiffs to claim tangible assets from those who owe them money. Since WWII it has been the IMF to sell off Public Sector assets, but before that it was done by military invasion! Today, in an age of MAD, the picture isn't so clear, as nuclear devastation would destroy most of the tangible assets! So, demographic and psychological warfare, and even biological warfare have been turned to as alternatives. My guess is that we're currently victims of demographic warfare. But, who is the enemy? Is it an 'enemy within' our own population or is it foreign? See Richard Acland of the 1941 Committee.

    One thing to bear in mind is that whilst most people will still think of countries divided vertically by geographical boundaries, the truth is far more complex (see the SI and New Labour for example, it was not like the SCO at all was it, why were they not members??). There are horizontal groupings too. There are in fact the same political ideologies in each nation to differing degrees, hence some countries' 'enemies within' are other countries ruling party. Who are we? My advice is to look to groupings by behaviour regardless of what people announce their groupings to be in order to see how it all really works.

    What patterns do you see? That's how a scientist looks at the world, and some don't like that at all, as it exposes them as actors....

    43. At 10:42pm on 12 Nov 2010, saucymugwump wrote:
    In #38, tabblenabble02 wrote: "The problem is that many people associate 'liberal' with the left instead of the libertarian right. It's the right-wing libertarian which causes most of the trouble here...."


    Great post. Much appreciated. I am still thinking about it.

  • Comment number 69.

    "53. At 01:43am on 13 Nov 2010, saucymugwump wrote:
    In #48, Ben wrote: "How are the Indian guys getting the jobs?"

    I'm glad you asked.

    My government created a system of work visas years ago. The two most important for this subject are H-1B and L-1 visas. H-1B visas were originally meant to bring in highly skilled workers, possessing knowledge that simply was not available here. I have no problem with that."


    Perhaps you should have a problem with it. It's a can of worms.

    One of the reasons for my references to Quine/Wittgenstein/Skinner etc was to try to get some more people to grasp that knowledge per se is an extensional, computational commodity, and it's not people based. If you import highly skilled people, that may mean bright people but it may not. A PhD is no longer a reliable guide to intelligence these days as standards differ across the world, and ability is peer normed (mean IQ of India is well below that of USA for example). Secondly, the skills of an IT engineer are computational. They are algorithmic. These are not psychological, personal skills, but behaviours which can be automated, and they are. This is a major issue which has not fully sunk in for most people yet. See one of the references to East Asian IQ tilt linked a few days back. It isn't just intelligence, it's how it's used that matters. That takes one into the second major factor - personality, which is much harder to quantify/measure than IQ, but it's improving.
    I'm suggesting that the ego vs all-centric dimension is important, and this bears on what's picked up by the Factor 'Conscientiousness' in the Big 5.

  • Comment number 70.

    "65. At 1:47pm on 13 Nov 2010, supersnapshot wrote:
    Wittgenstein had a good word for the above - nonsense.

    I suggest you get your own blog and stop clogging this one up with your nonsense."


    I suggest that for the benefit of all concerned, you explain what it is which you are referring to as nonsense. In the absence of that, it's impossible for anyone to tell whether what you are writing has any merit or whether you have just mistakenly learned to falsely describe all that you don't understand (or 'agree with') as 'nonsense'.

  • Comment number 71.

    "66. At 2:40pm on 13 Nov 2010, tFoth wrote:

    I am reluctant to get drawn into the tedious debate about genetic ability that mars this string: and which is entirely beside the point."


    Note how you use dismissive emotive terms of abuse right at the beginning. Is that not prejudicial?

    "However, it is worth saying that for any human ability (lets say
    running) there will be people who are very good at it, some who are no good, and a range in between on a normal distribution curve."


    Exactly. Do you not think the people explaining the important of cognitive ability know this? It is at the core of the discipline which creates IQ tests.

    "Whether different populations have different innate abilities is a moot point - unless you are intending to then use it to discriminate between them. Othwise, it serves no useful purpose."

    This strongly suggest you have not followed the links provided.
    The whole point is that these differences do exist, and that they have a dramatic impact on national economies (see 2007 video at least). That is the whole point of bringing the mater up. The fate of the USA was predicted on the basis of the changing demographics (Lynn 2001 last chapter of "Eugenics A Reassessment"). The above video is from the US body which monitors USA academic attainment. This is a bit like the ONS here telling you what's going on and you ignoring it because you don't understand who they are.

    The OECD does much the same via PISA. The DfE did the same via SATs. The World Bank provides similar data, as does the UN. The problem is public ignorance. Many people relate what they are told to their extremely limited knowledge, and reject what they find unfamiliar - to be nice about it, that's not very smart. Dysgenic fertility means the population is dumbing down genetically. It happens when the birth rate is much higher amongst the less cognitively able than it is amongst the more able. Do you understand the mechanism and consequences? To many 'indians and not enough chiefs to run the railroads... Too many claimants and not enough producers, do you see why China manages its birth rate eugenically? What will the effect of Article II of the FCHR be in Europe in contrast do you think? Why is it there....when the Chinese do the opposite?

    "I choose not to discriminate other than on the grounds of ability (pace Tom Lehrer)and note that in any of the groups or nationalities mentioned so far there are people across the whole spectrum."

    That just means you ignore the evidence as the differences are clear.
    How is ignoring the evidence ever a good or noble thing? How is it not prejudice?

    "Whether you can then effect a "red shift" in terms of overall ability through education etc is another issue."

    No, we do know that we can not do that through education. That was the message of Head Start in the 60s, and all the efforts since. That you don't know this is just a refection of your own education in this area (or lack of). You should not equate what you think with what is actually the case. People who get it wrong should fail their exams to make it clear that they do not understand, or they should be publicly corrected like this as in the public interest. There is no evidence that we can improve intelligence through education. It is appear to be a maturation process. There is evidence that we can lower intelligence through physical damage, though (blows to the head, drugs disease etc).

    "On the real point of this blog, there are obvious parallels between the current situation and the 1930s and the increasingly nationalist tenor of the public debate - and the emergence of groups like UKIP etc - is one. The quote from Mr Zweig is great on this."

    Internationalists don't like regulation. It gets in the way of profit at the expense of the vulnerable who are child like.

    "The challenge we face as people is to now find a solution to these problems that is based on something other than nationalism, protectionism and xenophobia. If not then we will not have learned from the 1930s and may be doomed to repeat the 1940s. I don't know what that something will be - but I know that it will not be founded on efforts to discriminate between ethnic groups."

    Can you tell the difference between a cat and a dog? An apple and a pear, a Braeburn and Granny Smith? Why do you think not making discriminations is clever? It's really very stupid not to discriminate.
    Brain damaged people have such problems. It's how one tests for brain damage in fact.

    I find it quite remarkable that any normal person can assert such things without shame. So did ETS when they published their report in Feb 2007.
    Watch the video.

  • Comment number 72.

    Mr. Bernanke’s new round of Q.E. has caught the world by surpriuse and upset it greatly.
    Congress has got just one way out of this mess: Congress must identify and deal with criminal mortgage & bond fraud, both of these on such a grand scale that it must seem impossible to comprehend, never mind clean up. The banker boys will be busy trying to stay out of jail, as will the Wall-Street Boys as a whole. Just look at then right now - grabbing commodities, silver and gold, and front-loading sticks as fast as they hit the market.
    Behind the scenes are the bureaucrats (Republican & Democratic). You can smell the decay in Congress, in the Senate, all the way to the Oval Office. The decay allows the "system" to continue, but decay also crumbles over time.
    Yet, so many Americans, most Americans, do not get "it".
    The financial institutions have been "reformed" and nothing changed.
    Congressmen (not all, but most) have been corrupted; Senators (not all but most) have been corrupted. Everywhere you look there is decay, and it stinks.
    Real bank reform is beyond the United States because the banks are too powerful, too tight with the Wall-Street Boys. The Federal Reserve has got to go; it is totally corrupted, so corrupted that no one can even pry open the door to conduct an audit. There has never been an audit of the bailouts, TARP, and there will certainly not be an audit of Q.E.2. What is so sacrosanct about the Feds? Don't you think throwing open the door would alleviate the stench? Start the clean-up?
    QE2 cannot work. Mr. Bernanke knows that it cannot work. Any economist with the right side of his brain intact (the logical side of the brain) knows that it cannot work.
    Was it only 8 eight years ago that it became well-known that Fannie Mae and Freddie Mac were broke, that they would eventually be nationalized at taxpayers' expense?
    The problems cannot be fixed; the problems are getting worse as I type. The problems will lead to a Q.E. 3.
    Why?
    Because the system is rotten; there is no other choice but to dump it on its corrupted head, shake the head empty and start over.
    In the meantime,, the flailing United States will continue to be estranged from foreign governments (who very likely think that those who run the American economy are daft!).
    They wull come to regret that they abetted the US by cheapening their own currencies, buying dollars and Treasury bills, notes & bonds - all of which is declining in value as I type. (China is trying very hard to unload the American stuff and diversify.)
    Foreign governments opened their eyes and saw a country so grostesquely corrupted that they recoiled and wanted a different reserve currency. Russia has said that no new international currency or trading unit will work (or be accepted) unless it is backed by gold. I don't think I'd go that far; silver's good, oil is good, any commody that has value is good.
    If the United States does not have gold, they have no product of value, in fact little production at all - maybe coal?
    IMF rules prohibit gold backing of the SDR (Special Drawing Rights are international foreign exchange reserve assets.)
    Right now Congress and the Senate are like chickens with theur heads cut off - which way to go, which way to go, whatever shall we do?
    Foreign economic chatter is pointed toward an index of several major currencies. This might well be an overall improvement, but one has to remember that all currencies have been exposed to some sort of Q.E. They are fiat currencies without gold backing, EXCEPT FOR THE EURO WHICH HAS @ 5% backing.
    Rather than face reality, the Wall-Street Boys (The Powers That Be) insist on lowering interest rates further, flooding the economy with money and credit.
    Would logic not tell you that if $868B + Fed injection of an admitted $1.9 trillion (more likely $2.5 trillion) couldn’t deliver an American recovery, another $600B is not likely to deliver recovery?
    Of course it can't! So the world must brace for yet another Q.E.(3) which will equal a lot of monetization and plenty of inflation.
    The worst mistake that foreign nations could make right now is to follow suit. They must not follow suit. In fact they should try to normalize, eliminate all artificiualty from their economic systems: Do not adjust - tariffs on goods and services.
    Mark my words: the White House is presently considering, or will soon consider, another BIG false flag operation. Purpose to beef up the military production, keep its soldiers employed and oil the war machines.
    The Wall-Street Boys have been pouring billions into elections for years, buying influence. It doesn't matter what the Wall-Street Boys do, their companies are too big to fail, and the Government will bail them out; they are leaches and they are sucking American taxpayers dry.
    The White House, the House and Senate, have decayed into structures of the elite. Think not?

  • Comment number 73.

    'I am reluctant to get drawn into the tedious debate about genetic ability that mars this string: and which is entirely beside the point. However, it is worth saying that for any human ability (lets say running) there will be people who are very good at it, some who are no good, and a range in between on a normal distribution curve.'

    -----------------------------------------

    It's quite interesting that you used the ability at running as a non sequitur.

    Just who are the best runners on the planet?

    'Ethiopia has turned it into a Stop & Shop. In the past three Olympics, in the big three distance races (the 5,000 meters, 10,000 and marathon), Ethiopia has won 22 medals, including 10 gold. Kenya has won eight and one, respectively.'

    http://www.denverpost.com/extremes/ci_12447930

  • Comment number 74.

    @tabblenabble02

    I have a genius-level IQ. I am also a biologist. IQ tests mean very little, especially when you are using them to compare individuals from different backgrounds. I have yet to see a meaningful study that has found any differences in IQ based on ethnicity (although there are many studies which fail to do so), or that has comprehensively found the genetic basis for intelligence. You are performing an extreme set of mental gymnastics to make a weak point.

  • Comment number 75.

    #74

    HURRAH!

    I would add that the notion of 'intelligence' itself is highly subjective. There are so many tacit assumptions in the modern world on a base line philosophical level which very few people even seem to notice anymore.

    Speaking of noticing things.

    what on earth is going on here?

    I noticed the story on the BBC last night, it seems to have been pulled this morning, this all seems very strange.

    http://www.independent.ie/national-news/cowen-fury-at-bbc-when-not-whether-bailout-claim-2419458.html

  • Comment number 76.

    Who is going to bail-out America?

    How the Tea Party is brewing up trouble for the world’s currencies
    http://www.telegraph.co.uk/finance/comment/edmundconway/8131605/How-the-Tea-Party-is-brewing-up-trouble-for-the-worlds-currencies.html


    ‘The Republicans used to be the party of the Washington Consensus, of free trade and deregulation – in short, supporting Globalisation III. No longer: a recent Pew Research Center report found that the Republican party is now more anti-free trade than the Democrats. Many of the Tea Party’s leading voices want an abolition of the Federal Reserve. The message from the mid-terms was that these voices can no longer safely be ignored. And if the US itself can’t work out a plan to overhaul the international economy, what hope is there for the rest of us?’

    Even geniuses (genii?) can make mistakes...

    ‘Moreover, why the arbitrary obsession with gold? The chief reason Britain instituted a Gold Standard (and others followed), rather than a silver standard, goes back to a mathematical mistake by Sir Isaac Newton in 1717, then master of the Royal Mint, in overvaluing the guinea in terms of silver.’

  • Comment number 77.

    In #69, tabblenabble02 wrote: "Perhaps you should have a problem with it. It's a can of worms."

    Yes, I agree. When I wrote my comment, I was assuming that immigration authorities would somehow verify the credentials of the applicant. How naive of me.

    tabblenabble02 wrote: "mean IQ of India is well below that of USA for example"

    This is why I would require applicants to have, at a minimum, a doctorate in a field that is rare in my country. Otherwise we are merely allowing the importation of cheaper labor.

    tabblenabble02 wrote: "the skills of an IT engineer are computational. They are algorithmic. These are not psychological, personal skills, but behaviours which can be automated"

    There is a world of difference between IT personnel and software engineers, i.e. programmers. I agree that IT skills can be instilled almost by rote, whereas programming skills require innate ability: one is either born a programmer or one is not. Java made this much less of an issue, as all previous programming languages were rather arcane.

    The ironic thing is that software engineers can be easily outsourced, while IT personnel often need to be onsite to fix problems (yes, I know about logins from elsewhere, but that won't work if the main hard drive is corrupted). We often hear politicians and other lizards claiming that outsourcing only affects jobs on the low end of the food chain, but with computers just the opposite is true.

    Did you read my previous joke regarding Fabian?

  • Comment number 78.

    In #73, DebtJuggler wrote: "Just who are the best runners on the planet? Ethiopia has turned it into a Stop & Shop."

    And the NBA is almost 100% black. And the NFL is almost to the point where only some quarterbacks, almost all kickers, and some offensive linemen are white. And competitive swimmers are almost exclusively white, though part of that is surely due to swimmers needing to practice at expensive pools. And I cannot remember a final of the 100m sprints, men or women, without a black finisher.

    In #74, HeecheeRendezvous wrote: "I have yet to see a meaningful study that has found any differences in IQ based on ethnicity"

    You should have written: "I have yet to accept a meaningful study that has found any differences in IQ based on ethnicity."

    The book liberals refuse to read is "The Bell Curve." 52 leading experts in the field endorsed the book's conclusions; read the letter sent to the Wall Street Journal at http://www.udel.edu/educ/gottfredson/reprints/1994WSJmainstream.pdf. These were not professors at institutes of racist learning, but ones from the very cream of American universities.

  • Comment number 79.

    In #72, BluesBerry wrote: "QE2 cannot work. Mr. Bernanke knows that it cannot work."

    I agree with pretty much everything you wrote, but I am still going to play devil's advocate in one respect.

    Bernanke is like the stereotypical nuclear physicist who cannot choose the proper shoes to wear. His world revolves around the Federal Reserve and Wall Street. He is like the man with only a hammer, looking around at his world to see how he can use his sole tool. He does not understand the impacts of outsourcing and therefore believes that QE will save the day. QE would only makes sense if the USA had a significant manufacturing capability, but this is no longer the case.

    The reason China is taking over the world, economically-speaking, is their exporting prowess. Germany understands this and is also benefiting, however China's never-ending industrial espionage is eroding Germany's position, as Der Spiegel often reports.

    The USA's problem is that a coup has been executed by Wall Street. The Tea Party continually whines about Obama's bailouts, yet Bush II created them. Obama shares the blames because he could have called a time-out; instead he hired Geithner, Summers, and other like-minded people. If the Tea Party was consistent, it would have demanded that every politician who voted for the bailouts be thrown out -- whether during Bush II or Obama -- yet they concentrated on Democrats because of Fox News propaganda.

  • Comment number 80.

    66. At 2:40pm on 13 Nov 2010, tFoth wrote:

    I am reluctant to get drawn into the tedious debate about genetic ability that mars this string: and which is entirely beside the point.
    However, it is worth saying that for any human ability (lets say
    running) there will be people who are very good at it, some who are no good, and a range in between on a normal distribution curve. "


    Might the reason that you are reluctant be that it's because closer analysis of what you think risks making you look unattractive rather than socially desirable? .How about variation in frequencies of melanin type determining skin pigmentation and thus synthesis of vitamin D from UV light and cholesterol in northern latitudes. What are the consequences amongst the lower ability/poor? What was the adaptation
    (mutation) of white skin for and what other phenotypes covary with this?
    Is this pigmentation Gaussian Distributed, and if so, is it Normal or Skewed in some geographical areas of Britain (and the USA)? Does this have any important implications for Public Heath and its funding/services, especially in these austere times? What would population expansion in these areas mean (through marked differences in birth rates)?

    Is (however well meaning) non-discrimination, smart behaviour or is it stupid behaviour? Whose interests do well meaning 'liberals' serve in terms of consequences?


    DENIAL AND MAKE-BELIEVE

    75. At 10:17am on 14 Nov 2010, Jericoa wrote:

    "I would add that the notion of 'intelligence' itself is highly subjective."

    But all you are saying there is that you don't know what you are talking about, as measures of intelligence are clearly objective. You just don't know how they are validated. How you and others talk about intelligence may be different to how professionals talk about it. What you think may well be subjective, but that's another matter, and it's one which that some of us are trying to help you to correct. Denying reality because one doesn't like the facts revealed by science is surely very child-like?

    Here's something else for you to think about. if you subjectively don't see what this has to do with Paul's post, go and look at the demographics of Gary, Indiana. Then look at the demographics of China (and recall Merkel's recent statement about multikulti in Germany in the wake of Mr Sarrazin's remarks). You're not making connections doesn't mean that there aren't connections, it just means that some people like you don't personally make the connections. Making these connections is what I and others can possibly help you to do, if you'll follow, on the other hand, perhaps you can't make them. perhaps you are not able to?.

    Note, if poster 74 had said they were from Neptune would have you believed them? Do you see the poverty of self-references (in anonymous postings especially - even with names you don't know it's them)? Do you see the merits of allo-centric references? What is your are of engineering and level of training? I ask as you make reference to it, but these skills are not evident in your posting behaviour. If someone said they were Harry Potter, would you believe them? Why not? Doi you just think people who say things you (mistakenly) agree with are right, and can that ever make you more right? Why not just refer to yourself yesterday and count yourself twice, three times etc?

  • Comment number 81.


    "74. At 11:33pm on 13 Nov 2010, HeecheeRendezvous wrote:
    @tabblenabble02

    I have a genius-level IQ. I am also a biologist. IQ tests mean very little, especially when you are using them to compare individuals from different backgrounds. I have yet to see a meaningful study that has found any differences in IQ based on ethnicity (although there are many studies which fail to do so), or that has comprehensively found the genetic basis for intelligence. You are performing an extreme set of mental gymnastics to make a weak point."


    You have got to be joking!

    1) This post tells me you have yet to read the links. ;-)
    2) This post tells me you have yet to learn anything about this matter ;-).
    3) This post tells me you need to look up 'argument from authority' ;-).
    4) This post tells me you need to get a proper IQ test done. ;-)

  • Comment number 82.

    In #76, DebtJuggler referenced the Telegraph's commentary on the Tea Party.

    Sometimes the Telegraph prints astute observations. Often it prints some really moronic ones.

    From that article: "a recent Pew Research Center report found that the Republican party is now more anti-free trade than the Democrats. Many of the Tea Party’s leading voices want an abolition of the Federal Reserve."

    The second sentence is absolutely true. I would say that virtually all Tea Party members desire the abolition of the Federal Reserve.

    The first sentence is complete pablum. Sarah Palin is on record as favoring outsourcing. Carly Fiorina, one of Palin's chosen few, is infamous for outsourcing thousands of jobs when she was the CEO of HP. In Fiorina's recent campaign, she even had the brass to claim that she was the only candidate to have created jobs; too bad they were all in India and China. Soon-to-be House Speaker John Boehner is on record as favoring the completion of the free trade treaties with Columbia, Panama, and South Korea. Senator Mitch McConnell, and his wife the former Bush II Labor Secretary, do not have an anti-free trade bone in their bodies.

  • Comment number 83.

    Heechee @ 74

    I have a genius-level IQ. I am also a biologist. IQ tests mean very little, especially when you are using them to compare individuals from different backgrounds. I have yet to see a meaningful study that has found any differences in IQ based on ethnicity (although there are many studies which fail to do so), or that has comprehensively found the genetic basis for intelligence.

    I agree. I find this whole thing about IQ a complete nonsense. I've read too much Nietzsche to take seriously anyone who claims superiority because they claim to have a higher IQ (whatever that is). Perhaps if we all shared the same bourgeois background as those who wrote the tests then the IQ nonsense may have some meaning.

    To follow on from Jericoa's comment @ 75 that the notion of 'intelligence' itself is highly subjective, I would add that 'intelligence' is just some middle class BS that makes them feel more superior to the working class.

    Tabble - you need to read some Nietzsche and Foucault (and perhaps Heidegger's views on language too)!

  • Comment number 84.

    This blog is being disrupted by one poster who feels that PM is the vehicle to disseminate their own particular thesis.

    I'm going on comment strike forwith until get their own blog. Adieu.

  • Comment number 85.

    84 supersnapshot

    Don't strike: occupy!

    I have been sitting this one out as I usually get the full force of abuse from the obssessive. However, it is encouraging to see that others have come to the same conclusion.

    Despite our differences we have more in common than we think. Pause for a speech on Mutual Aid from Comrade Kropotkin.

  • Comment number 86.

    A MISSING LINK

    "frequencies of melanin type determining skin pigmentation and thus synthesis of vitamin D from UV light and cholesterol in northern latitudes. What are the consequences amongst the lower ability/poor? "

    41. At 10:14pm on 12 Nov 2010, saucymugwump wrote:

    "He does seem to be overly interested in Fabian, but maybe he does not appreciate the other teen idols of the 50s and 60s, e.g. Ricky Nelson, Frankie Avalon, and Elvis Presley"

    The seemingly innocent days of the state (here), when people seemed young, and long before the US experienced The British Invasion......

    Did I get the joke? I'm not sure. It's all getting a bit too serious over here, (as over there). People ('liberals') still make out they don't get that The Bell Curve was about human classes, earning power, and dysgenic fertility, and not race at all. Race was just used to bring home an important point about genetic diversity and economic activity. It goes for the poor whites too, and differential fertility is the issue.

    Can anyone shed some more light on what started to happen viz BoE
    securitization of assets here
    just as the Conservatives were about to end their period in office in the mid 90s, and which massively took off as securitzation of dwellings in the noughties?. The pattern is what seems odd to me.

  • Comment number 87.

    The tag line on George Monbiot's website (http://www.monbiot.com/) says...

    'Tell people something they know already and they will thank you for it.
    Tell them something new and they will hate you for it.'

  • Comment number 88.

    i've just watched C4 Trillion Dollar Horror story and their hayekist black propaganda of cut spending =increase in manufacturing.

    What twaddle. Without doing something about China and the rest being 40% undervalued? you can make things all day long but if you can't sell them cause the guy in the next shop sells them not 5% or 10% but 40% cheaper then what?

    the idea the only reason a company goes bust is because its rubbish is childish. What about unfair international competition?

    as for going back to the 1930's heyday 'heaven' of private medicine :(

    Hong Hong is hardly a useful model for the uk as the uk has no adjoining communist superstate that can use it to launder money.

    China as a 'capitalist economy'? hahaha. More a somali pirate economy.

    this programme completely misidentifies the cause of the world imbalance. cutting taxes is not the solution to chinese devaluation etc.

    the show is dangerously deluded. That is not to say the state isn't too big.

    In a zero sum game you can only get rich my making other people poor. So the question is in your desire for infinite wealth how poor do you want to make other people?

    Boston University has a disinformation course

    http://www.ajr.org/article.asp?id=2082



  • Comment number 89.

    82. At 4:12pm on 14 Nov 2010, saucymugwump wrote:

    "The second sentence is absolutely true. I would say that virtually all Tea Party members desire the abolition of the Federal Reserve.

    If only the TEAparty anarchists could see themselves as some others see them.

    Plus ça change,...............plus c'est la même chose - Few see this here.

    83. At 6:10pm on 14 Nov 2010, dceilar wrote:

    "I would add that 'intelligence' is just some middle class BS that makes them feel more superior to the working class. "


    On the other hand, maybe you're missing something veryimportant?
    What you think of 'the working class' is clearly coextensive with the lees cognitively able, so of course the more cognitively able are intellectually superior to the less cognitively able as it's a measurement scale It's like saying that taller are superior to shorter people. What socialists refer to as 'the working class' are those people who earn their living through their labour (physical or intellectual, see Soviet and Chinese constitutions) as opposed to those who live by capital. That's the real distinction. University professors are workers.
    You are just radically (and seemingly incorrigibly) confused.

    84. At 6:25pm on 14 Nov 2010, supersnapshot wrote:

    I'm going on comment strike forwith


    If only this would be practiced more widely, we might then have a better chance for a viable future. Why do you think Germany dispensed with 'liberal-democracy' in the 1930s?

  • Comment number 90.

    . At 7:06pm on 14 Nov 2010, stanilic wrote:

    Don't strike: occupy!

    I have been sitting this one out as I usually get the full force of abuse from the obssessive. However, it is encouraging to see that others have come to the same conclusion.

    Despite our differences we have more in common than we think. Pause for a speech on Mutual Aid from Comrade Kropotkin. "


    Predictably, and anarchist. You're just recruiting your own TEA Party who are just anarchists. Not that many see this. It's a function of the child-like way that they are.

    I suspect Rosa Luxembourg never saw what she was doing wrong either. Such is intensional opacity. In the end, Germany turned, and if I'm correct, this time it will be far more who turn, drawing upon the SCO and its allies. Adults know that the arrested developed have to be put in their place for everyone's best good (including their own).

  • Comment number 91.

    85. At 7:06pm on 14 Nov 2010, stanilic wrote:

    "I have been sitting this one out as I usually get the full force of abuse from the obssessive."

    I suggest you look back through your own, and other people's histories.
    Can you see times when you (and others) have abused others for correcting you (and others) on matters of fact, which you (and others) may have regarded as their forcing their contrary opinions on you, or depriving you of your freedom to believe and say what you wished?

    There is a most peculiar history to this behaviour where those behaving this way have secured affirmative action for themselves whilst creating a contrary to the facts equalitarianism which has slowly insidiously subverted (deregulated) entire populations throughout history, ultinately t o the cost of entire economies. What were these exchanges about in 1939?

    "Do not imitate the sentimental and leisurely manner in which we ourselves treated this problem," the two statesmen are reported to have said. "Our kindness was nothing but weakness, and we regret it."

    Strong stuff for diplomatic language!

    "87. At 7:50pm on 14 Nov 2010, DebtJuggler wrote:
    The tag line on George Monbiot's website (http://www.monbiot.com/) says...

    'Tell people something they know already and they will thank you for it.
    Tell them something new and they will hate you for it.'


    Nail - head.

    Given the mammalian universality of this and its power, it's probably a CNS phenomenon. Locus Coeruleus/PAG/Arcuate Nucleus? Clue, cleaved from POMC. ;-)

  • Comment number 92.

    MIGHT THE IQ (PURPORTED) MEASURE OF INTELLIGENCE ENDURE BECAUSE IT SUITS THE GROUP WHO DO BEST IN IQ TESTS?

    I have noted the assaults above, on Tab02, with interest. It seems to me that Tab has a 'measuring-stick' that he carved after long study of other measurement-specialists (scientists) who CONFIRMED HIS BIAS. If you don't 'measure up' BY TAB'S STICK you are wrong - simple.

    Ironically, the history of science is peppered with DISCARDED measuring sticks, and today those of Einstein and Hubble, to name just two, are beginning to suffer mysterious 'length changes' (not unlike the changes to 'immutable' half-lives). http://wattsupwiththat.com/2010/08/23/teleconnected-solar-flares-to-earthly-radioactive-decay/

    'Every day the clever man finds he knows something new and the wise man is a little less certain.'

    Here's to a lot less certainty.

  • Comment number 93.

    In #86, tabblenabble02 wrote: "Did I get the joke? I'm not sure."

    Every now and then you reference Fabian Socialism or Fabian society. Every time I see that I think of teen idols and not in a good way. It just strikes me as amusing. I guess it is a good thing there are not more people named Elvis.

    tabblenabble02 wrote: "The Bell Curve was about human classes, earning power, and dysgenic fertility, and not race at all."

    There are references to studies where a European had an IQ of 100, an African had an IQ of 85, and a person with one European and one African parent had an IQ halfway between 85 and 100. How is that not based on race?

  • Comment number 94.

    ...In reply to a question, Obama was more bellicose, saying that the issue of the [renminbi] is one that is an irritant not just to the United States, but is an irritant to a lot of China’s trading partners and those who are competing with China to sell goods around the world. It is undervalued. And China spends enormous amounts of money intervening in the market to keep it undervalued...

    http://www.globalresearch.ca/index.php?context=va&aid=21916

    yes. we can't export not because of high taxes or low taxes big state or little state its because the game is rigged by big players spending huge fortunes to keep it rigged.

  • Comment number 95.

    CURRENCY PROOFING (#94)

    I'm in Flanian Pobble Beads Jaunty. No flies on me - just the usual 80 footer, tryng to extract my marrow.

  • Comment number 96.

    92. At 9:26pm on 14 Nov 2010, barriesingleton wrote:
    I have noted the assaults above, on Tab02, with interest. It seems to me that Tab has a 'measuring-stick' that he carved after long study of other measurement-specialists (scientists) who CONFIRMED HIS BIAS. If you don't 'measure up' BY TAB'S STICK you are wrong - simple.

    Ironically, the history of science is peppered with DISCARDED measuring sticks, and today those of Einstein and Hubble, to name just two, are beginning to suffer mysterious 'length changes' (not unlike the changes to 'immutable' half-lives).

    http://wattsupwiththat.com/2010/08/23/teleconnected-solar-flares-to-earthly-radioactive-decay/

    'Every day the clever man finds he knows something new and the wise man is a little less certain.'

    Here's to a lot less certainty. "


    More anarchist speak. And people wonder why we are in an economic mess.
    There's more ignorance about that's for sure. Every day people fail to pay attention to what they are told, and yet seem proud of that....

    Somehow you, and these other people who appear to remain ignorant of what's being explained to them based on data from all over the world (see SATs, TIMMS and OECD PISA for just three measures) and which validate IQ measures (Maths and English SATs and GCSEs are themselves proxy measures) know better?. These tests are trusted by people who know what they are talking about and it's patently clear to me that you don't. So you just confusing your ignorance of an entire area of science with your not knowing something.... it's bizarre..

    How is it that so many people like yourself, 'suspect not', or magically seem to think that you actually know better?. How is that at all possible under the circumstances unless it's a windup?? Might it not just be that none of you are very bright? You in particular have told us that you lack specialist education in these areas. So how can you possibly know?

    A logical answer please.

  • Comment number 97.

    93. At 10:07pm on 14 Nov 2010, saucymugwump wrote:

    "There are references to studies where a European had an IQ of 100, an African had an IQ of 85, and a person with one European and one African parent had an IQ halfway between 85 and 100. How is that not based on race?"

    Because there are (poor) White people with IQs of 85 too. This is about analysing the role of genes and QTLs (groups of genes as IQ is bound to be polygenetic) behaviour. genes are not coloured ;-) Colour is just one phenotype..

    When behavioural geneticists use different groups (sometimes different species like fruit flies, mice, strains of rats, type of primates etc) it's to so they can study genotypes and phenotypes in isolation and also do comparative work knowing genes are relatively well isolated by assortive mating. Different human racial groups serve this function, as mating is largely within a group (Blacks with Blacks, White with Whites, Asians with Asians, Hispanics with Hispanics etc). This allows one to look at the relationship between genes and behaviour in a natural way.
    The same is done with twin studies (MZ vs DZ, reared apart and/or together). This allows one to tease out the contributing roles of genes vs environment. Race itself is not what's of primary interest, it's more how genes are passed on and how these determine behaviours. It turns out that home environment contributes very little to intelligence, nor does schooling. What one learns from this work is how behaviour is constrained by gene barriers between groups, which thus informs one of what's also happening within groups.

    Nobody is really interested in rats' or pigeons' behaviour when working with these animals in Skinner Boxes. Similarly, most of the research is not particularly interested in skin colour or hair type etc, but what else is constrained within a group by assortive mating, e.g prevalence cancers, IQ etc.

    Herrnstein and Murray made it clear that race was not what the book was about, but like some people reading this blog, some people can't tell what's relevant from what's not. It tends to take a lot of time to learn these things. if you know the mean IQ of one group is an entire SD (15 points below another) and that the first group is growing at a faster group than the second, the population mean will, over time go down. If crime and demand on welfare is highly correlated with IQ, one can make predictions of what will happen in the future as the racial composition of the entire population changes, one can predict what will happen to the economy even though what one is predicting is a relationship about behaviour, with race just being incidental. See the ETS work. This is done by many groups. The B-W gap is interesting for economic reasons as we can not improve intelligence by education, so if the low skilled part of the workforce is growing and the high skilled is shrinking, work the economic advantage will shift overseas as explained here in feb 2007 before the crunch . Some of us have been saying it for a long time. ETS came to it late.

    I did get the Fabian pun. The problem is that China is Fabian, and I suspect Russia as a member of the SCO is too, albeit covertly (see Golitsyn). The USA appears genetically doomed alas. Too many anarchists, ex East Europeans I suspect, I think it's genetic, female genes in male brains..

  • Comment number 98.

    In my view, we are seeing a representative, but developmentally arrested, self-selecting sample of the population posting misguided, i.e ill-informed personal views above. The uninformed majority of people (see the shape of the Gaussian Normal Distribution) are critical of what I've posted above and elsewhere because, like the vociferous studio audiences of The X Factor and Strictly, they are judging what they read in terms of social desirability, i.e narcissistic approval, not on the basis of empirical facts. What they write is what they think will earn them approval, what looks or sounds good. Not what is true. This is why democracy as populism doesn't work, and why in the end it's highly corrosive. Those who preach equality and fairness aren't in fact referring to social or economic reality. They are our #economic' Harry Potter fan club.

    "The report also shows how wealth was distributed across households. Median household net wealth was £204,500 in 2006/08. The least wealthy half of households accounted for only 9 per cent of wealth, while the wealthiest 20 per cent of households had 62 per cent of total wealth. The least wealthy 10 per cent of households had negative total net wealth."

    ONS UK Wealth/Assets

    We live in a decadent, skewed, culture which exploits populist, appealing narratives. It awards prizes to those who produce appealing narratives (see book prizes and Hollywood etc, and for some this behaviour earns massive revenues. What doesn't win prizes are accounts which are truthful. This is what refer to as The Harry Potter Syndrome.
    We appear to be living in a massive Hogwarts (who are the Muggles?)

    Unless a critical mass of people changes their behaviour, and unless our approach to government radically changes, and unless we collectively see the self destructive folly of this celebrity culture which even manifests itself in these blogs, our economic situation can't improve.
    If and when it finally gets so bad that something has to change, I fear there willl be a backlash against those who hawk narrative at the expense of pursuit and practice of truth, just as there was back in the 1930s with bonfires of a particular class of books..

  • Comment number 99.

    It is fascinating watching the Television News and reading the various articles in the papers this morning on the Eire problem.

    Numerous pundits, journos and so-called experts are pointing out that Eire's problems are due to their enormous and ludicrous housing bubble - but failing to make the link between that bubble and the fact that much of the money lent for it was from British banks... or that the UK has a similar housing bubble that could equally go pop.

    I heard one 'expert' on the radio this morning comment that the UK was different to Eire in that they had an over-supply of housing and we do not. Hmm, isn't that what the Japanese claimed in the early 1990s?

    I suspect that the housing benefit reforms will show that the UK has no shortage of housing - just one giant propped up ponzi scheme. It was only 10 years ago that we were seeing whole streets in Northern towns going for £50 per house.

    Maybe the Government should do a deal with the Irish Government - bail out their banks by allowing thousands of Londoners to be rellocated to the shiny new estates in the Republic!?

  • Comment number 100.

    MASS MUTUALISATION is now the new Libertarian mantra.

    The Libertarians were up early this morning!

    David Cameron's ideologue, Phillip Blond (from the 'think tank' ResPublica) was on Radio 4's Today programme early this morning extolling the benefits of Mass Mutualistaion of public sector assets in order to to pay off 'the nations debts' (shell game?). He was desperately trying to sell it as some sort of virtuous half-way-house between a state owned asset and superior privately owned assets - run 'by the people for the people' (aka Big Society??).

    Luckily John Humphrys and his other guest speaker (I think it was) Mehdi Hasan from The New Statesman were more than able to counter Blond's predatory libertarian claptrap. At the end of the piece you can hear clear surprise expressed by Blond (as he thought the mic's had been switched off) at the robustness of the defence against his pathetic pitch/argument!

    (piece was on Today at around 6:50 this morning http://www.bbc.co.uk/programmes/b00vw1yd#synopsis)


    Blond kept banging on about the example of the the imminent privatisation of the venerable, Dover Harbour Board, as a shining beacon for his wacky strategy...but things aren't going too smoothly on the Dover front at the moment.

    Dover people's port bid 'undeliverable'
    http://www.bbc.co.uk/news/uk-england-kent-11710298

    'DHB, which has run the port as a trust since 1606, asked the government for permission to privatise it in January. A decision is expected soon.
    Dover People's Port website says it wants to prevent the "gateway to the nation" being sold to overseas buyers.

    "Despite making statements that the people of Dover would 'own' the port - at a minimal payment of only £10 per head- it is estimated that such ownership could only be achieved if each and every one of the people of Dover, 39,000 in all, contributed over £5,000 per head to the trust,"

    "The reality is that financial institutions would be financing the deal."'

 

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