And there’s not a thing anyone can do. So this is where we are now at:
A senior Israeli official confirmed to Israeli media that the US had suspended a shipment of Hellfire missiles to Israel amid worsening ties over fighting in Gaza.
Now why would they do that unless they wanted Israel to lose? For more along the same lines, see this.
You would think the Japanese would at least have absorbed the lessons from the catastrophic results of their first stimulus. Such was not the case so they tried another. Didn’t work again.
The economy of Japan, long stagnant, has taken a sharp turn for the worse: It contracted nearly 7 percent (annualized and inflation-adjusted) in the quarter ending in June. By way of comparison, consider that the U.S. contraction in the quarter ending in June 2009, when we were feeling the worst of the financial crisis, was 4 percent; the worst quarter of the 1982 recession saw a contraction of 2.6 percent. You’d have to go back to the 1940s to see a quarter with a 7 percent contraction in the United States.
As a kind of kiss of death, Paul Krugman was full of praise for the policies adopted, called Abenomimcs after the Japanese Prime Minister Shinzo Abe. This is what Professor Krugman said a year ago:
The really remarkable thing about “Abenomics” — the sharp turn toward monetary and fiscal stimulus adopted by the government of Prime Minster Shinzo Abe — is that nobody else in the advanced world is trying anything similar. In fact, the Western world seems overtaken by economic defeatism.
Another great victory for Keynesian stimulus. A few more victories like that and we will be at poverty levels not known since the 1930s. Possibly as remarkable as the outcome in Japan is that even the commentator at National Review Online doesn’t actually understand it himself. He doesn’t really know why these policies didn’t work and can only say something vague about the mathematisation of economic theory and the difficulties in applying policies that might work in one country to another.
Strangely, the policy adopted in Japan included increases in consumption taxes which I am incredulous that anyone would believe would lead to a recovery. Raising taxes in a recession is dead set dumb, as dumb as raising public spending. Next time they should try lower taxes and lower public spending to see how that works out for a change. I know it’s out of fashion, but you never know what might happen then.
[Via Instapundit]
There are three events coming to a head at the moment that relate to my work on Say’s Law.
There is, firstly, the publication of the 2nd ed. of Free Market Economics which will be co-published by the Institute of Economic Affairs in London. On my involvement with the IEA in the publication of this book, I have written:
Let me also add how delighted I am that this second edition is being published in association with the Institute of Economic Affairs. There has been no organisation more influential on my way of thinking about economic issues than the IEA which almost alone stood up for free markets and free enterprise in those dark days of the 1970s and early 1980s. It was the IEA which brought to wider public attention authors such as Milton Friedman, Friedrich Hayek and James Buchanan. The points they made have to be continually re-iterated as ideas with a less impressive academic provenance, not to mention frequently disastrous economic results, continually take hold in public policy debates
Then, second, if it can be arranged, I will be off to the First Congress on Jean-Baptiste Say and the Entrepreneur in Auchy on the north coast of France. This is the letter of invitation I received last night.
Dear Colleague,
I am honored to invite you to participate in the 1st International Congress Jean-Baptiste Say- RNI Summer School 2014, organized by the Research Network on Innovation and the International Society Jean-Baptiste Say (SAYS) from the 27th to 30th August 2014 at Universite du Littoral Cote d’Opale, Boulogne-sur-Mer and at Auchy-les-Hesdin (Nord-Pas de-Calais, France):
The conference is composed of various conferences, workshops and cultural activities (Cf. the program of the conference http://says.univ-littoral.fr/?page id= 102). Your contribution to the academic debates and your participation in different activities during will be highly appreciated.
I am looking forward to meeting you this summer.
I wish I were ten years younger. I didn’t think it would come to this, but travel has a lot of wear and tear. But for this one I am definitely ready to make the effort. Say is returning, and even though they focus on his work on the entrepreneur, they only leave out Say’s Law because it is too contentious.
And last but definitely not least, there is the movie being made that has, at its very centre, a series of principles of economic management based on Say’s Law. If you would like to read the book from which the movie is being made from, it’s called Waffle Street. It is premised on an understanding of Say’s Law so you’d hardly think it’s movie material but the world is stranger than you can sometimes believe. But if you get the book, you will see nine principles at the end, the first one being, “production is the source of all consumption”, that is, demand is constituted by supply. I am told there is a cameo of my Say’s Law and the Keynesian Revolution that has been filmed. But whether or not it makes it past the cutting room floor, this is strangely the first movie ever made based on an economic principle. It also has an incredible story line that has the potential to make it the movie of the year. If you don’t believe me, read the book, and if you do, make sure you get to the list of nine “Articles of Economic Faith” at the end.
Those exertions of natural liberty of a few individuals, which might endanger the security of the whole society, are, and ought to be, restrained by the laws of all governments.
Adam Smith (1776)
I think of myself as a free speech absolutist. There is no point of view that is not open for debate and all perspectives are invited to join. Jews are descended from apes and pigs. Well, that’s one way of looking at things. Jews are murderers of Gazan children and use their blood to make matzohs. Speak the truth as you see it. There was no holocaust but if there were one we would do it right this time round. Interesting, please tell me more.
As you may imagine, I am disgusted and outraged by each of these but the principle is more important than the abuse that some make of the principle. Public discourse is very dangerous, but beliefs that cannot be challenged in public debate is where the greatest dangers lie. Bring them out into the light. Go on, discredit yourself, because if there comes a time when saying such things in public does not make you a social leper, then things have already gone too far. Your rabid, racist, repulsive views are genuinely useful information for the rest of us. It requires judgement to know what can and cannot be said in public without consequence, but there should be nothing to stop you from saying what you want.
But racist rants in public amongst strangers, people abused on the streets by others they do not know, are out of bounds in a civilised community. It is just not on, rightly illegal. In the workplace or amongst those known to each other it becomes trickier but I side, with a heavy heart, on the side that this is just one of those things up with which we must put. But I also understand those who take a different view.
Ordinary people are not political philosophers. They are not social theorists who have read, absorbed and contemplated the arguments of John Stuart Mill. They are not people who are immune to abuse for their religion, skin colour, gender or anything else. Most people are prepared to debate all issues but they are not prepared to have to deal with some idiot shouting abuse at them on the street or where they work.
If the government cannot distinguish between free speech in a civilised community and a racist rant individually one-on-one in a public place, then it should not have gotten into this debate in the first place. And had they made this distinction, they could have presented their aim in terms of doing something positive, that being stopping racists rather than protecting the rights of bigots. What a loser argument that was! Why didn’t the government show they were providing something that will aid comity in the community, not taking something useful away. I fear by not thinking this through, they have damaged the cause of free speech in this country.
The stupidity of policies to counter global warming may yet turn out to be one of the most lethal set of policies ever devised by the human race. We found ourselves able after a million years of primitive existence to harness various forms of energy to keep us warm, power our businesses, cook our food and transport us from place to place. For this, we have been using various forms of carbon-based fossil fuels that, because they have defied the leftist fools who predicted capitalist misery, have decided to bring on this misery on their own. They are despicable in their worm-eaten destructive impulse. But in this particular episode, may yet contribute to a catastrophic future of such immense misfortune, that there are no words to describe how misbegotten their effects will be.
Maurice Newman has a review of David Archibald’s The Twilight of Abundance: Why Life in the 21st Century Will Be Nasty, Brutish, and Short in today’s Australian, a book that I have a much longer review of coming out in the September Quadrant. But Newman, whose piece begins by asking What if David Archibald is Right?, spells out what ought to be part of our communal conversation.
Russian scientists at the Pulkovo Observatory are convinced the world is in for a cooling period that will last for 200-250 years. Respected Norwegian solar physicist Pal Brekke warns temperatures may actually fall for the next 50 years. Leading British climate scientist Mike Lockwood, of Reading University, found 24 occasions in the past 10,000 years when the sun was declining as it is now, but could find none where the decline was as fast. He says a return of the Dalton Minimum (1790-1830), which included “the year without summer”, is “more likely than not”. In their book The Neglected Sun, Sebastian Luning and Fritz Varenholt think that temperatures could be two-tenths of a degree Celsius cooler by 2030 because of a predicted anaemic sun. They say it would mean “warming getting postponed far into the future”.
What worries me even in this review is that it merely suggests that AGW may be wrong. It doesn’t set out what happens if there is an actual global cooling. The effects, if Archibald is anywhere near right, are the deaths of tens of millions of people in a world that can no longer feed, clothe and house its population where energy supplies are lower while growing seasons are cut short. If you think it’s science fiction, the Great Plague wiped out between one-third and half of Europe’s population in the fourteenth century. This is a future we can actually prepare for if we start thinking that we might have to. In the meantime, we are savaging our energy industries and raising the cost of all forms of production, including farm production. Human stupidity knows no upper bounds. If this is yet another instance, well that’s how it will be. But we have been warned, and if you are still of a mind to side with the likes of Obama and Julia Gillard, you may yourself be complicit in one of the greatest crimes in human history.
Before I arrived on this continent these many years ago, the image of Australia to me as depicted in Private Eye was the comic strip Barry McKenzie written by the brilliant Barry Humphries. In fact, the first movie I saw in Australia was the second of the Barry McKenzie films. It more or less fixed the image that had commenced with Monty Python’s Australian Philosophy Department. What then radically changed my view of Australia was to discover that Simon Leys, the author of Chinese Shadows, lived in Canberra and taught at the ANU. He has now passed away, on August 11. I would not have known except for the notice in The Australian today written by Theordore Darlrymple, a writer I have almost as much affection for as Leys, whose real name was Pierre Ryckmans. This is from the notice. The first sentence below can only ever be stated once in this day of the internet. It is incredible, but not misguided, that Darlrymple says what he says here:
I admired Simon Leys more than any other contemporary writer. He was, in fact, my hero, in so far as I have ever had one. Although he had previously written discerningly about Chinese art, I first read his books about the Cultural Revolution. Leys, of Belgian origin, was a passionate lover and connoisseur of Chinese culture and viewed its barbarous destruction with horror during the Revolution; he abominated Maoism at least two decades before it became obligatory for all right-thinking persons to do so. From the very first page — no, from the very first sentence — of all his books and essays it is obvious that Simon Leys always knew what he was talking about.
Leys’ guiding star was cultivation (in a broad sense) and his betes noires barbarism, stupidity and humbug. There was no better sniffer out of humbug, the besetting sin of intellectuals, anywhere in the world.
The final line of the notice reads, “Australians should be proud that he chose Australia as his home for the last 44 years of his life.” I feel exactly the same.
From Drudge, just a few side comments on the American economy, not featured but just listed. All so very ho hum because really, who doesn’t know any of this:
Fed Official Warns ‘Disappointing’ Growth Could Foretell Future…
Sluggish jobs market points to structural problems…
Yellen Determined To Avoid ‘Nightmare Scenario’…
Record income gap fuels housing weakness…
Wages Down 23% Since 2008…
Bank Profits Near Record Levels…
Let’s start with the first of these, Fed Official Warns ‘Disappointing’ Growth Could Foretell Future:
The official, Stanley Fischer, who took over as vice chairman of the Fed in June, noted that although the weak recovery might simply be fallout from the financial crisis and the recession, “it is also possible that the underperformance reflects a more structural, longer-term shift in the global economy.”
In a speech delivered on Monday in Stockholm at a conference organized by the Swedish Ministry of Finance, Mr. Fischer also conceded that economists and policy makers had been repeatedly disappointed as the expected level of growth failed to materialize.
“Year after year, we have had to explain from midyear on why the global growth rate has been lower than predicted as little as two quarters back,” he said. “This slowing is broad-based, with performance in emerging Asia, importantly China, stepping down sharply from the postcrisis surge, to rates significantly below the average pace in the decade before the crisis.”
Mr. Fischer said it was difficult to determine how much of the slackness was because of cyclical factors and how much represented a more fundamental, structural change in advanced economies.
In essence, they don’t have a clue what’s going on. Clear as crystal what the problem is if you don’t think along Keynesian lines and do not believe raising aggregate demand is the answer. In fact, all of it makes perfect sense if you go back to the pre-Keynesian (i.e. classical) theory of the cycle. But economists are now three generations into Y=C+I+G that thinking in any other way is a near impossibility.
But this is the one I find the most graphic, US Wages Down 23% since 2008. The American economy is falling into bits and real incomes are falling through the floor:
U.S. jobs pay an average 23% less today than they did before the 2008 recession, according to a new report released on Monday by the United States Conference of Mayors.
In total, the report found $93 billion in lost wages.
Jobs lost during the recession paid an average $61,637. As of 2014, jobs in the same sectors paid an average of $47,171 annually.
“Under a similar analysis conducted by the Conference of Mayors during the 2001-2002 recession, the wage gap was only 12% compared to the current 23%–meaning the wage gap has nearly doubled from one recession to the next,” stated the Conference of Mayors in a statement.
The report also found that 73% of metro area households earn salaries of less than $35,000 a year.
And the only thing they have thought to do to assist business has been to lower interest rates to near zero which, if they understood anything at all, they would understand would only make matters worse.
Tony Abbott is not the enemy.
BARACK OBAMA ON PRESIDENTIAL VACATIONS IN 2008: “You have to understand that if you seek that office, then you have to be prepared to give your life to it. Essentially, the bargain that I think every President strikes with the American people is, ‘you give me this office, then in turn my fears, doubts, insecurities, foibles, need for sleep, family life, vacations, leisure, is gone. I am giving myself to you.’”
A liar at every turn but not a scandal because although he may be a liar he’s the media’s liar (as in, he may be a bastard, but he’s our bastard).
Both from Instapundit.
The oldest hatred in our universities in Melbourne:
Matthew Lesh from the Australasian Union of Jewish Students told Tom Elliott they’ve had a “phenomenal” experience on campus in the past two weeks.
“What’s happening on the other side of the world is directly impacting Jewish students in the most disgusting and despicable manner,” he said.
“We’ve seen across campuses, across Melbourne, even across Australia, what would be classed as anti-semitism in any understanding being carried out against Jewish students simply because Jewish students are associated with Israel.
“Some of the things that we’re hearing on campus at the moment are beyond reprehensible.
“You’ve got fundamental bullying of people just because of their views, their religious beliefs.”
From Instapundit so it’s an international story as well.
Law of Markets 