Monthly Archives: March 2020

How to deal with the coming downturn in ways that will actually do some good

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Here is the latest in idiotic advice on how to deal with the economic consequences of the Corona V: Scott Morrison ‘must ramp up stimulus to $60bn’. I keep thinking that there must eventually be an end to Keynesian stupidity and ignorance but it seems endless.

Here is what is happening. There is a major structural dislocation going on, some of which will be temporary and some of which will be permanent. The problem is NOT A LACK OF DEMAND. If you think it is, you are as economically clueless as it is possible to be. The problem is that some firms and industries are being clobbered by an unanticipated fall off in sales because, for example, if you are in the business of providing ocean cruises, there are going to be a lot fewer sales, and nothing in relation to increased demand will sell you a single additional ticket.

Some people are going to lose their jobs, either temporarily or permanently. There will be enormous uncertainty all across the economy. The only value a government might provide is to assist in the ADJUSTMENT PROCESS. Most assistance must be on THE SUPPLY SIDE, although there might be some value in assisting those who are being displaced from their jobs with a bit of income replacement.

Keynesians are a one-trick pony. The advice might have been useful in the 1930s when not only did unemployment rise to unprecedented levels but at the same time the price level was falling. It wouldn’t have worked then either, since what they did do was cut public spending and balance the budgets everywhere but in the US. And everywhere but in the US there was an almost instantaneous upturn. The Great Depression reached its trough in 1933, and then the General Theory was published in 1936.

If you are an economic advisor and you cannot tell the difference between a structural problem and demand deficiency then you are an incompetent. Please try to address the actual problem, and not some phantom issue that has not only never allowed an economy to emerge from recession but if applied now in these circumstance will only make things worse.

Hubble bubble toil and trouble

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Double, double toil and trouble, fire burn and cauldron bubble

The actual words with the key word in any case being “bubble” as in, anyone who depends on the mainstream media for the news.

The point is this. From NY Times reporter: “disdain for and distrust of the media right now is worse than I’ve seen at any point throughout this presidency”. These people lack self-knowledge to such an extraordinary level that you have to think of them as autistic to some extent at least. Do they really think of themselves as trustworthy, as people from whom we can go to for news? Go to the link to see the rest. The examples in the tweet below are precious and well-chosen, but there are many many more.

Yet I know lots of people who never read or watch anything outside their MSM bubble. It is always astonishing, but in the end, always really depressing.

Fair is foul, and foul is fair:
Hover through the fog and filthy air.

The modern media to a “T”.

Joe Biden is the perfect avatar for the Democrats

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Let me see. Dementia, corrupt, incompetent, generally stupid, lies continually. Yet he is now better than evens to win the election given that the media are demented, corrupt, incompetent, stupid and lie continually. It’s why he was the last candidate left standing – aside from Bernie the Bolshevik – amongst the Democrats. That these people have anything critical to say about Donald Trump is the surest sign of how politically out to sea they are. Complete political fools. All from Instapundit over the last couple of days.

HE STOPPED AT SIX BECAUSE THE MERCY RULE KICKED IN: 6 Recent Examples of Joe Biden’s Cognitive Decline That Should Concern Us All.

WELL, YES: ‘It’s Not A Speech Problem But A Brain Problem’: Peter Hasson Says Biden’s Stutter Isn’t Responsible For His Lies.

LOSIN’ IT: Joe Biden Appears to Forget What Office He’s Running for (Again) During Victory Speech.

TRUMP’S CORONAVIRUS PLAN WAS SO AWFUL THAT BIDEN STOLE IT: Joe Biden Blasts Trump’s Coronavirus Response, Then Plagiarizes Trump’s Plan

NOT THE FIRST TIME, NOT THE LAST TIME: Michigan worker: Biden ‘went off the deep end’ in expletive-laden exchange.

BEHOLD! MY SHOCKED FACE!  NBC Conveniently Leaves Out Unflattering Portions of Biden’s Confrontation With Auto Factory Worker.

JOHN HINDERAKER: Joe Biden Can’t Be President. “I’m not saying Biden shouldn’t be president. That has always been true. I am saying that he lacks the physical and mental qualities necessary to do the job–not to do it well, but to do it at all. Biden’s mental status has slipped badly over the last few years, and he appears physically frail as well. Both his handlers and the press try to shield him from public scrutiny and hide his decline, but under the bright lights of a presidential campaign, it can’t be done.”

JEFF JACOBY: ‘Moderate’ Joe Biden has moved way to the left.

MEANWHILE, OVER AT VODKAPUNDIT: Joe Biden Slams Bernie Sanders for “Joining” Donald Trump. “I’m not sure what Biden meant by that, and judging by some of his recent public appearances, Biden might not be entirely sure, either.”

Plus: His own campaign, the DNC, and the press (but I repeat myself) are all circling the wagons to keep their own frontrunner out of the public eye as much as possible.

HARSH, BUT FAIR:

But sucking up to powerful men is what Kamala does. And it generally pays off for her.

Mill’s Principles reviewed by Bonar in 1911

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In 1911, James Bonar wrote a review on the publication of the Ashley edition of Mill’s Principles of Political Economy which was published in The Journal of Political Economy, titled: The Economics of John Stuart Mill. It perfectly summarises the consensus view of Mill’s economics at the start of the twentieth century, which shows just how far from the centre Mill’s economics had already by then moved.

If John Stuart Mill’s eminence is not supreme, it is great enough to make almost every utterance of his worth considering. His was rarely a hasty judgment; and what he says of his fellow-enthusiasts of the year 1825 might be applied to himself on most occasions: he never left a subject he had taken up until he had (to the best of his ability) untied every knot in it.

Another century later, there is virtually no economist who reads Mill today for instruction. And it’s not just their loss, we all lose because of the inanity of modern theory. It is the residuals from the economics of Mill and his contemporaries that allow our economies to limp along and innovation to continue. It was also interesting to discover how Mill came to write The Principles:

The success of the Logic drew him back into political economy by making the publishers willing (perhaps anxious) to print what they had refused before, namely, the Essays on Some Unsettled Questions in Political Economy, Mill’s part of the work projected in 1831 [he had originally intended to co-author a series of papers on economics which is why it was “Mill’s part”].

As he was setting out to write his Political Economy, he wrote the following to Auguste Comte in 1844:

I know what you think of the present political economy. I have a better opinion of it than you; but, if I wrote something about these things, I should never forget the purely provisional character of all its concrete conclusions and I should devote myself more especially to separating the general laws of production, necessarily common to all industrial societies, from the principles of distribution and exchange, which assume a particular state of society. Such a treatise could have a great provisional utility, especially in England.”‘ It might appear to you essentially anti-scientific; and it would be so as a matter of fact, if I were not taking great pains to establish the purely provisional character of every doctrine (about industrial phenomena) which made abstraction from the general movement of humanity. I think that if this plan is at all adequately executed it would give a scientific education (education positive) to many who are now studying social questions more or less seriously; and in taking as my general model the great and brilliant work of Adam Smith I should find good opportunities for spreading directly one or two principles of the new [positive] philosophy, as Adam Smith found them for spreading most often those of negative metaphysics in his social applications, yet without awakening dark misgivings by waving any flag.

I find this especially enlightening since quite a number of Mill’s views that have been superseded according to Bonar are views that I believe are of premier importance.

There are many details of economic doctrine in respect of which Mill has probably few followers now. Occasionally his positions, instead of being solemnly refuted, are quietly dropped as purely Ricardian. Many of the pages devoted to wages and profits are so treated. His particular form of Malthusianism has gone out of doors into the hands of an energetic sect of reformers. Without adopting the sweepingly adverse verdict of Jevons, we may admit that there is at once too much and too little in Mill’s Political Economy for most of us now. We should not confine wealth to exchange value, or believe that nothing remained to be added to the theory of value. We should not say that without competition there is no economics. We should not say so broadly that industry is limited by capital. We should not make so much of the distinction between productive and unproductive labor or try to prove that a demand for goods can never in any sound sense be a demand for labor. We cannot be induced to rank land, labor, and capital as co-ordinate factors in production, or to adopt Senior’s view that abstinence is rewarded in interest. We should probe further into the cause of interest. We might ratify the general principle of Malthus without making all progress turn on the practical recognition of it. We should be more chary than Mill in the use of the word ” laws.” We should not, all of us, admit that the “laws” of production were purely physical and the “laws” of distribution “of human institution solely.” Mill was probably aware that the abandonment by him in I869 of the wages fund carried consequences reaching into the heart of his arguments on profits and wages reducing them largely to useless dialectic.

But once we have removed Malthusian pessimism on population from the list, the rest of Mill’s judgements stand, even if few [no] modern economists any longer understand or subscribe to Mill’s position.

Much more to read at the link if these things interest you. But there is this one error that should be a reminder that no one can write anyone else’s life without error. This was the dates of Mill’s life stated by Bonar: “(May 20, 18o8, to May 8, 1873)”. Mill was, in fact, born in 1806.

Trump: We will suspend travel from Europe to US for the next 30 days

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I imagine others will become part of the travel ban as well. I also think this is true:

The media’s hysteria about coronavirus is intended to destroy the American economy because media types are focused single-mindedly on defeating Trump.

There is therefore no longer any independent source of information you can trust since the media is now fully corrupted by its political messaging. Who can you turn to?

Is this true?

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I still head to the city every day on the train along with many others, while others that I know are now staying home and avoid crowds. From Instapundit.

ADVICE: Cancel Everything. Social distancing is the only way to stop the coronavirus. We must start immediately.

Related: When Danger Is Growing Exponentially, Everything Looks Fine Until It Doesn’t.

There’s an old brain teaser that goes like this: You have a pond of a certain size, and upon that pond, a single lilypad. This particular species of lily pad reproduces once a day, so that on day two, you have two lily pads. On day three, you have four, and so on.

Now the teaser. “If it takes the lily pads 48 days to cover the pond completely, how long will it take for the pond to be covered halfway?”

The answer is 47 days. Moreover, at day 40, you’ll barely know the lily pads are there.

That grim math explains why so many people — including me — are worried about the novel coronavirus, which causes a disease known as covid-19. And why so many other people think we are panicking over nothing.

During the current flu season, they point out, more than 250,000 people have been hospitalized in the United States, and 14,000 have died, including more than 100 children. As of this writing, the coronavirus has killed 29 people, and our caseload is in the hundreds. Why are we freaking out about the tiny threat while ignoring the big one? . . .

But go back to those lily pads: When something dangerous is growing exponentially, everything looks fine until it doesn’t. In the early days of the Wuhan epidemic, when no one was taking precautions, the number of cases appears to have doubled every four to five days.

The crisis in northern Italy is what happens when a fast doubling rate meets a “threshold effect,” where the character of an event can massively change once its size hits a certain threshold.

In this case, the threshold is things such as ICU beds. If the epidemic is small enough, doctors can provide respiratory support to the significant fraction of patients who develop complications, and relatively few will die. But once the number of critical patients exceeds the number of ventilators and ICU beds and other critical-care facilities, mortality rates spike. . . .

The experts are telling us that here in the United States, we can avoid hitting that threshold where sizable regions of the country will suddenly step into hell. We still have time to #flattenthecurve, as a popular infographic put it, slowing the spread so that the number of cases never exceeds what our health system can handle. The United States has an unusually high number of ICU beds, which gives us a head start. But we mustn’t squander that advantage through complacency.

So everyone needs to understand a few things.

First, the virus is here, and it is spreading quickly, even though everything looks normal. Right now, the United States has more reported cases than Italy had in late February. What matters isn’t what you can see but what you can’t: the patients who will need ICU care in two to six weeks. . . .

Second, this is not “a bad flu.” It kills more of its hosts, and it will spread farther unless we take aggressive steps to slow it down, because no one is yet immune to this disease. It will be quite some time before the virus runs out of new patients.

Third, we can fight it. Despite early exposure, Singapore and Hong Kong have kept their caseloads low, not by completely shutting down large swaths of their economies as China did but through aggressive personal hygiene and “social distancing.” South Korea seems to be getting its initial outbreak under control using similar measures. If we do the same, we can not only keep our hospitals from overloading but also buy researchers time to develop vaccines and therapies.

Fourth, and most important: We are all in this together. It is your responsibility to keep America safe by following the CDC guidelines, just as much as it is House Speaker Nancy Pelosi’s or President Trump’s responsibility to lead us to safety. And until this virus is beaten, we all need to act like it.

Indeed.

152Posted at 7:09 am by Glenn Reynolds 

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LET ME ADD THIS TO THE CONVERSATION: I’m not trying to scaremonger, and I know how the media is in it as a means to subvert PDT’s re-election, but let me also mention this: Coronavirus: Five days before virus ‘tidal wave’ hits Australia which has lots of stats and comment, including this:

NED-1361-Limiting the pandemic’s impact - 0

BUT LET ME FINISH OFF WITH THIS: On the more upbeat side: Military Surgeon: ‘Trump Is Right’ on the Seasonal Flu Being More Dangerous than Coronavirus. I’ve been amazed how dangerous the flu is although how comforting that might be is hard to say.

97% of people who think global warming is a problem are gullible fools

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Dr. John Robson investigates the unsound origins and fundamental inaccuracy, even dishonesty, of the claim that 97% of scientists, or “the world’s scientists”, or something agree that climate change is man-made, urgent and dangerous.

For a transcript of this video including links to some of the sources, please visit http://climatediscussionnexus.com/vid…

Abolish the family

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I’m a little late to the feminist party but watching the reaction of women to the latest version of The Invisible Man I can see just how vile this anti-patriarchy issue has become. Men in general are ruining women’s lives, a meme based on the undoubted fact that some men are creating harm in some women’s lives. The latest article on feminism to come across my notice is this: Why Modern Feminism Wants To Get Rid Of The Family which will be ignored by everyone. It’s written by a Chinese-Malaysian woman, S.G. Cheah who had the same kind of communist upbringing that I had. She starts:

When I first stumbled upon this Vice article titled “We Can’t Have a Feminist Future Without Abolishing the Family,” I thought this was just another story about a lunatic, fringe, radical feminist. Vice is, after all, struggling to keep its lights on, so naturally they would resort to sensationalist click-bait type of stories in order to bolster their readership. Nothing sounds more outrageous than a feature story on a feminist thinker who calls for the abolishment of families, as well as the right to abortion (specifically as the justifiable killing of babies).

She gets some of it but this last para depressed me, and here I focus on her first two words:

At least Mao Zedong tried to openly eliminate the concept of gender during China’s Cultural Revolution. To Mao, there was no difference between the man and the woman. Gender is “a social construct.” The radical feminist shares this belief and wants to achieve the same genderless outcome as Mao. However, the feminist is employing their societal transformation discreetly, like a crooked conman stealing your money quietly through fraud (oh sorry, I didn’t mean to use sexist language, I meant ‘conwoman’). And they’re doing so by working to destroy the family unit.

What is so good about getting rid of the concept of gender is an unknown but she too has the feminist infection, even if she doesn’t know it. To say one positive word about the Cultural Revolution is a sign of grave idiocy whatever else you might believe. And that she believes that eliminating gender is a good thing is a madness in itself. But for all that, you should read the article through.