Economics from bad to worse

I’m afraid I have now come upon the definitive evidence that economists have no idea how an economy works. It’s from The Economist last month, it’s titled, “Money from Heaven”, but it is the subtitle that provides all the evidence that economic theory is lost in the forest and is unlikely to find its way out any time soon: To get out of a slump, the world’s central banks consider handing out cash.

“HELICOPTER money” sounds like an item on an expense claim at a hedge fund. In fact, it is shorthand for a daring [!!!] approach to monetary policy: printing money to fund government spending or to give people cash. Some central bankers seem to be preparing their whirlybirds (and their printing presses). In March Mario Draghi, the president of the European Central Bank, described helicopter money as a “very interesting concept”. Ardent supporters see it as a foolproof way to perk up slumping economies.

The notion has as much potential to drive recovery as the NBN or Building the Education Revolution. It continues to believe that public sector waste in the form of fake versions of productive investment (green energy, crony capitalist enterprises, rail and roads) will make an economy grow. No modern economics text so far as I know even discusses the notion of value added outside of the national accounts, which means economists grow up without knowing the single most important part of what causes growth. It is never part of the equation. Seriously, how could any self-respecting economist endorse this?

Advocates of helicopter money do not really intend to throw money out of aircraft. Broadly speaking, they argue for fiscal stimulus—in the form of government spending, tax cuts or direct payments to citizens—financed with newly printed money rather than through borrowing or taxation. QE qualifies, so long as the central bank buying the government bonds promises to hold them to maturity, with interest payments and principal remitted back to the government like most central-bank profits. (The central banks now buying government bonds insist they will sell them at some point.) Bolder versions of the strategy make the central bank’s largesse more explicit. It could, for instance, hand newly printed money directly to citizens. Jeremy Corbyn, leader of Britain’s Labour Party, has proposed “people’s QE” of this sort.

The advantages of helicopter money are clear. Unlike changes to interest rates, stimulus paid for by the central bank does not rely on increased borrowing to work. This reduces the risk that central banks help inflate new bubbles, and adds to their potency when crisis or uncertainty make the banking system unreliable. Fiscal stimulus financed by borrowing provides similar benefits, but these could be blunted if consumers think taxes must eventually go up to pay off the accumulated debts—a problem helicopter money flies around.

Haven’t these people ever heard of Venezuela? Do they really not understand that growth comes from value adding production and can come from nothing else. Do they not understand that for a project to be value adding, the value of what is produced must be greater than value of the resources used up. Loss making enterprises cannot cause growth. If this is really what economist think, economics is beyond a pseudo-science and into the region of crackpot.

They think we’re fools


Gavin McInnes has done something quite extraordinary and it turns out that having done what he’s done, the result is even more extraordinary than you might ever have imagined it would be. He has gone and interviewed Jesse Hughes, lead singer of Eagles of Death Metal, the group playing at the Bataclan in Paris on the night it was stormed by Islamists and where almost 100 members of the audience were killed. The piece is titled Surrendering to Death where his point is that we are unprepared for what is being inflicted on us and are doing nothing to toughen up. I begin towards the start of the interview but there is much more there:

Do you think political correctness is killing our natural instincts and making us vulnerable?

Definitely. There were two girls who were involved. They were at the venue and vanished before the shooting, and these women were in traditional Muslim garb. They knew people wouldn’t check them because of the way they were dressed. They got caught a few days later.

The fear of offending Muslims is a terrorist’s greatest weapon.

“When the cops went in after the attack, they shut down, what, 450 mosques? They found recruitment material in every single one of them.”
Look at the guys who bombed Brussels. They were wearing black gloves on one hand. Their luggage was too heavy to lift, but they didn’t want anyone helping them with it. Nobody brought any of this up until after the bombs went off.

We’d rather die than be called a bigot.

How is a faith being associated with racism? Just take out the word “Islam” and replace it with “communism.” It’s an ideology. The same way the Rosenbergs could sell nuclear secrets from within America is the same way Muslim terrorists can attack us from within. It’s okay to be discerning when it comes to Muslims in this day and age.

Where is this push coming from? Is it all our fault?

Of course not. When you’re at a soccer game in Europe and you see the words “United Arab Emirates,” you know there is a lot of Arab money floating around and influencing the dialogue. The conversation is constantly being steered away from scrutiny. They think we’re fools. . . .

Political correctness kills.

Davey [bassist Dave Catching] was in the middle of the stage and when the lights went on, he saw shit he’d never seen before in his life, awful stuff. It has no parallel. It’s not just death. It’s the most unsuspecting, innocent victims you can imagine—people who are gripped in terror and can’t move as a result of it.

It’s like a metaphor for all of Western civilization.

I watched about seven people die. A couple of them were three feet from the barrier. They could have fallen backwards and been alive but they were too scared to even turn around. I remember a woman just standing with her hands up in a surrender pose. The terrorist finally saw her and all she did was go, “No no no.” She surrendered to death in front of my very eyes. I was yelling at her, “HEY!” and I don’t think she could hear me. She was so terrified, I think she’d already given up.

It’s not long but whether it is or not, it is filled with a kind of detail about the modern non-defence of the West that should be thought about. They are out to kill us and take our countries from us – including your very own country, the one you are living in right now. They want to take your country and make it their country. That’s exactly what they want and this is the kind of article that reminds you why they may well end up doing what they have set out to do.

“No debate or dialogue” is the very essence of a fascist mentality

In 1933, Adolf Hitler wished to kill the Jews. He was a National SOCIALIST, that is, he was a man of the left. It was not that he was a German nationalist that made him the psychopathic madman that he was, but that he wished to kill German citizens of Jewish descent, invade other countries, enslave their citizens and also kill their citizens of Jewish descent. He is unique in European history; no one either before or since has had a program anything like the one he spent twelve years trying to achieve.

Which is why stories like this are so repulsive: Far-right on edge of power as Austria votes for president since the basic premise is that with such parties, the political environment of Europe is returning to the policies of Hitler and the Nazis. This is what is going on in Austria:

Austrians voted Sunday in a key presidential runoff which could usher in the European Union’s first extreme right-wing leader amid the continent’s worst post-war migrant crisis.

A huge influx of asylum-seekers, growing unemployment and frozen reforms have left Austria deeply polarised and driven angry voters away from the centrist ruling coalition toward fringe groups.

For the first time since 1945, the president will not come from one of two main parties, prompting national media to warn of a political “tsunami”.

Instead, the showdown pits 45-year-old Norbert Hofer of the anti-immigration Freedom Party (FPOe) against the Green-backed economics professor Alexander van der Bellen, 72.

This is what democracy is for. Fringe groups move to the centre if they offer policies that voters wish to endorse. No one anywhere in the world believes that Norbert Hofer wishes to murder Austrian citizens or wage war outside Austria’s borders. One is not “right wing” if they wish to see their borders made secure and their country not overrun by citizens who decide to show up and live there. So again, let us look at just how bad Hofer is:

Observers warn that beneath Hofer’s smooth image lurks a “wolf in sheep’s clothing”, who has already threatened to seize upon never-before-used presidential powers and fire the government if it fails to get tougher on migrants or boost the faltering economy.

European leaders including European Commission chief Jean-Claude Juncker have also voiced concern at the turn of events in Austria.

“The prospect of seeing the far-right win forces me to say that I don’t like them,” Juncker told French newspaper Le Monde on Friday.

“The Austrians don’t like to hear this but I don’t care: there is no debate or dialogue with the far-right.”

“No debate or dialogue” with people who do not wish to see their homeland flooded with migrants who do not speak German, have no cultural ties with Austria and have no marketable skills. This chap Juncker is made of the same stuff as Merkel. If they aim to impose their views without debate or dialogue, if they wish to ignore the expressed wishes of the voting public, it is they who are the fascists, the Nazis, the criminal gangs, the right wingers. And it is they who will be the death of Europe for reasons still completely unexplained.

Anti-Trump Republicans are the worst kind of fools

Whether he knows it yet or not, Paul Miringoff at at Powerline will vote for Donald Trump. There are nerves to settle and plenty of time to do it. But in his quite informative column discussing his uncertainties he brings two other columnists into it who are both deeply anti. You really do have to think these people ought to have their keyboards taken away from them for their own safety. The first is Michael Gerson:

Gerson contends that Trump is unfit to be president:

It is not enough for GOP partisans to assert Trump’s superiority to Clinton on this issue or that. They must justify that Trump has the experience, knowledge, temperament, judgment and character to be president of the United States.

Gerson argues that Trump fails this test because of his positions on illegal immigration and Muslim entry into the U.S., and because a New York Times piece showed Trump to be a “cave-man” when it comes to women.

The second article is by Robert Kagan:

He argues that Trump will bring fascism to America. . . . Kagan has announced that he supports Hillary (some attribute this decision to an affinity with the Democrat on foreign policy issues).

It’s not just an over-heated brain. The man is a moron with pretentions to insight. My wife gets mad at me for not explaining myself when I kick such stupidity out the door without discussion. But there are morons everywhere and you cannot parse their idiocies to the end of time.

Paul, you gotta stop reading these guys and worrying about their opinions. Steve Hayward is trying to explain things to you on your own blogsite: THE ENDLESS ENIGMA OF DONALD TRUMP. This is where things are heading, and you should be heading there along with everyone else: New Poll: Republicans Are Increasingly Positive About Donald Trump.

The sharp elbows of Justin Trudeau

Above is the moment when St Justin Trudeau elbowed an MP in the chest right on the floor of the House of Commons. Below is a discussion of these events by Canadian commentator Brian Lilley.

Below is the discussion on the Brian Lilley radio show where you can hear the comments among the population. It last a couple of hours but it is extraordinary and especially the part at the start when Brian explains what went on. The metaphor for the kind of mentality Trudeau has is quite striking, no pun intended.

Do Donald Trump and Andrew Bolt not have exactly the same position on migration?

My wife and I have just watched the segment on Bolt with Niall Ferguson and then Rowan Dean where the issue of multiculturalism and immigration was at the centre of the conversation. The way I would construct what was said is this:

  • there is this problem associated with migration where some people are entering the country who do not wish to become part of the majority culture
  • this has now created social tensions causing people to look for political solutions
  • the result has been this terrible situation where “populists” like Donald Trump are now able to get political traction.

My question then is this: In what way is Donald Trump not attempting to solve the very problem Andrew Bolt and the others have raised? They can give it any name they please, but when you get right down to it, the issue is how do we ensure that those allowed to migrate into Australia will become Australians, or in the US case, Americans.

So I will repeat what I have said before, following Kant: if you would will the end, you must will the means. Commentators, historians and magazine editors are not political leaders, and their skills are not in devising political programs. Are not Trump’s ends their ends? If not, what is it exactly that they do want? And if they more or less do share Trump’s ends, do they not see that he is onto something in the approach he is taking? Or if they support the ends but not the means, how would they go about achieving these ends?

It just does seem to me that they do support the ends that Trump is promoting, but for some reason find themselves unwilling to endorse either the means or the man.

Not even a paper tiger, more like a paper kitten

With Obama still president, the only person more mindful that Obama still has another seven months of havoc creation time available is Obama himself. Here is Victor Davis Hanson discussing How Barack Obama’s Foreign Policy De-Stabilized the World. But with time running out on Obama, as Hanson notes, this is prime time for troublemaking while Obama is still around:

Aggressors are not sure whether Hillary Clinton, if elected, will govern more like a traditional Democratic president committed to leading the Western alliance. And if Donald Trump were to be elected, no aggressor would know exactly why, when, or how he might strike back at them.

Given those uncertainties, it may seem wise in the waning months of 2016 for aggressors to go for broke against the predictable Obama administration before the game is declared over in 2017. For that reason, the next few months may prove the most dangerous since World War II.

Being published on the same day as we read all of this on Drudge:

China Ready to Launch Nuke Subs…
NATO finalises military build-up to counter [more unpredictable] Russia
Iran Is Demanding Reparations From US for 63 Years of ‘Spiritual and Material Damage’

And what is Obama up to? Here is the latest news from Washington: Guard Charged With Assault After Confronting Transgender Woman Using Women’s Restroom, Police Say.

Those of you in Perth might be interested in seeing David Archibald, who is the author of the book Australia’s Defence (Connor Court), discuss all of this:

Free Public Lecture
Australia’s Defence
By David Archibald
Wednesday 25th May 2016
7:00pm at the Irish Club
61 Townshend Road, Subiaco
(between Hay St and Churchill Avenue)
Doors open at 6:30pm

The lecture includes 126 slides and will take one and a half hours. For a copy of the slide presentation, email him at: I note that David is an ALA candidate in West Australia, but this should not in any way be seen as an endorsement for the ALA.

America’s anti-American foreign policy

This is one of the most insightful articles on American politics I have come across in quite a while. The title is “Anti-Americanism is the Foreign Policy of Fools”, but it’s his sub-title that more closely explains the text: Anti-Americanism is the only foreign policy that the American Left needs. The point is that the left has no foreign policy other than to oppose Republicans. It is simply a vehicle for domestic political advantage. The actual outcomes across the world are of no consequence other than in terms of whether or not it allows Democrats to win elections. But what makes this policy so profoundly striking is that at the centre of the political views of the left, and what gives it whatever consistency it has, is a deep and unabiding anti-Americanism. The article begins with an observation on Ben Rhodes, who by now should need no introduction.

Ben Rhodes knows next to nothing about foreign policy. He has no idea whether Iran will get nukes and couldn’t care less whether it’s moderate or not. He’s a failed fiction writer whose goal is “radically reorienting American policy in the Middle East in order to make the prospect of American involvement in the region’s future wars a lot less likely”. . . .

Rhodes sneers at the reporters whom he manipulated as knowing nothing. And he’s right. But he also doesn’t know anything. The condition is typical of an American left which has no foreign policy. It only has an anti-American domestic policy which it projects internationally without regard to its relevance.

What has brought Rhodes to prominence is his involvement in selling Obama’s capitulation to Iran.

The Iran deal had to happen to defeat “neo-conservatives”, the “war lobby” and whatever other leftist boogeyman was lurking around the premises. The men and women doing the defeating, like Rhodes, had zero interest in what was actually happening in Iran or what its leaders might do with nuclear weapons. They would tell any lie to help sell the deal because they were fighting a domestic battle of narratives. Iran wasn’t a real place. It was a fictional counter in a domestic ideological battle.

He provides another example from the previous Democrat administration:

Bill Clinton had no foreign policy. Like Obama, he viewed foreign policy in terms of his domestic conflicts with Republicans. He tried to engage diplomatically while retreating militarily. His botched intervention in Yugoslavia had strong similarities to Obama’s disastrous intervention in Libya.

The argument is that American foreign policy is, so far as the Democrats are concerned, merely domestic policy. The consistent theme is opposition to traditional American values which means opposition to the Judeo-Christian tradition.

Anti-Americanism, like most prejudices, is a license for ignorance. By embracing a prejudice against their own country, Democrats have lost any skill at foreign policy that they once had. Instead of learning anything about the world, they resort to the easy answer of turning away from the confusing problems of other countries to blame them all on us. Anti-Americanism is the only foreign policy that they need.

Until now, the Democrats could maintain this position without actually damaging America itself although the damage elsewhere has been immense. That is no longer so. Either the policy will have to go or America will. It will be impossible for both to exist long term.