Category Archives: Cultural

Fixing economics

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There is an article by Tim Thornton in today’s Age with the title I might have written myself, The problem with the way we educate economists. He thinks the problem is neo-classical economics which is the standard mainstream taught to everyone who seeks to become an economist. In saying he doesn’t like the way we teach economics, he is really saying he doesn’t like the standard theory found today or more particularly, the quality of the economics profession itself. These are the three problems with the way we teach he lists which are problems with the people who make economic policy:

Firstly, there is generally no required study of economic history or the history of economic thought. This produces graduates with dangerous levels of historical amnesia in regard to the world and to the discipline they assume they understand.

Secondly, contemporary economics students will rarely encounter any of the schools that compete with the neoclassical school: institutional, post-Keynesian, behavioural, Marxian, Austrian, feminist or ecological. These economics schools, which come from all points of the intellectual and ideological compass, make crucial contributions to building up our understanding of a complex and ever-changing economic and social world.

Thirdly, the curriculum fails to incorporate crucial insights offered by other disciplines such as politics, philosophy, history, sociology and psychology.

With any discipline what you teach depends on the question you want to answer. If you are interested in knowing how goods and services end up produced, incomes earned and output distributed, neo-classical theory is pretty reasonable. I say this even having major differences with the mainstream. The course I teach and the book I wrote cover all three of issues raised. I embed my course in history and the history of economic thought. I contrast modern theory with its classical alternative so no one comes away thinking there is only one answer to any question. I introduce politics, philosophy and history, although I must admit seeing little value in either sociology or psychology in answering any of the questions economists have traditionally asked.

Typically, those who would like to root out our modern neo-classical inheritance do so for some quasi-Marxist reason. They are seeking answers to different questions. Their interest is in explaining the distribution of power within a society. This is, of course, politics or sociology but it is not economics since even if you knew the answers to any of the questions a political scientist or sociologist might ask, you still wouldn’t understand how goods ended up being produced, what economic structures would give you the greatest output, how the community’s command over goods and services could be increased, what to do in recessions, or even what causes recessions in the first place. Instead what would be taught is some variant on the unfairness of the system and how it needs to change to ensure those who have the least wealth, which typically means those who have contributed the least to our communal flow of goods and services, can get a larger share of the pie.

Economics emerged as a separate study over two hundred years ago when our societies were extremely poor as they had been since the beginning of time. Now we, who live in economies where markets predominate, are astonishingly wealthy by any and every standard that an economist two hundred years ago might have listed as an aim and ambition. And because of the innovation machine that has been set in place by these same economic structures, we have a reasonable expectation that our wealth will continue to grow.

If someone has a better answer to the questions economists wish to answer, then they must convince other economists first. To take your ball and bat and go off somewhere else may make it easier to find someone to agree with what you say, but then you are talking into an echo chamber of your own construction. There is lots wrong with economics – lots – but to ask for a separate discipline, or encourage a schism within economic theory because you have a different view, is not the way these issues will ever be resolved.

But where I can overwhelming agree is that the economics establishment has built an edifice as strong and formidable as the one built by mediaeval theologians. The answers it gives to many questions seem wrong to me and many others. I hate to show disrespect to Her Majesty, but when she asked after the GFC why no one had forecast the recession, she was asking a question for which there will never be a solution. Recessions happen and it is precisely because they are unexpected that they turn out so badly.

What economists can, however, do is explain why that is, and try to provide answers on how to recession-proof our economies as best we can and hasten recovery when they turn down. Neo-classical theory, being drenched in Keynesian structures, will unfortunately never be able to find the answer to either question which is why a genuine review of economic theory and policy is so urgently required. But because a bunch of twenty year olds are dissatisfied with the answers that modern economic theory has devised is the worst possible reason for looking out for new answers to old questions, which in their case really turns out to be looking for old answers to different questions.

Is that a good thing or a bad thing?

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This is from Laura Tingle as part of her opinion piece on the budget in today’s AFR:

In the short term, the lack of fiscal consolidation, underpinned by increased taxation, makes the Abbott government look like a bunch of girls.

The consensus at lunch was this was meant to be a derogatory comment. If so, Australia is the last English-speaking country in the world where this would be allowed to happen. And they call Abbott a misogynist.

Bubonic plague in Sydney – in 1900

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sydney bubonic plague

Did you know we had ever had bubonic plague in Australia? This is the story with pictures of how Sydney was cured of the plague in 1900. There are others pictures besides the one above. The text:

“When bubonic plague struck Sydney in 1900, George McCredie was appointed by the Government to take charge of all quarantine activities in the Sydney area, beginning work on March 23, 1900. At the time of his appointment, McCredie was an architect and consulting engineer with offices in the Mutual Life of New York Building in Martin Place. McCredie’s appointment was much criticised in Parliament, though it was agreed later that his work was successful.”

Now that’s an interesting question

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From John Hinderaker at Powerline, Why did Hillary Clinton Defend Boko Harum? Why indeed? Here is the start of his post:

Boko Haram, the Islamic terrorist organization in Nigeria, is in the news because it kidnapped more than 200 teenage girls and now threatens to sell them into slavery. (That’s what a real war on women looks like.) This is just the latest of many outrages committed by Boko Haram, which is guilty of many acts of mass murder. But it has now come out that for two years, Hillary Clinton blocked efforts to add Boko Haram to the State Department’s list of terrorist organizations.

This wasn’t just an episode of bureaucratic indifference. The Justice Department, the FBI, the CIA and many in Congress lobbied the State Department to list Boko Haram, but Clinton stood firm in defense of the Nigerian terrorists. Now, with the kidnapping outrage in the news, Hillary is tweeting away on behalf of the Nigerian girls. (THAT will do a lot of good!) But where was she in 2011 and 2012?

But seriously, why ask her? The one you should ask is her Chief of Staff.

Torah studies in China

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Now here’s a story, from Michael Ledeen. It’s called The Chinese and the Jews. This is how it starts:

Over the past couple of decades the Chinese have become more interested in the Jews. Of late the Chinese regime has been bringing Jewish scholars and theologians to the People’s Republic to discuss Torah, Talmud, Mishnah and even some of the more mystical tracts.

Now why would that be? Again some answers:

Back when the country’s greatest modern man, Deng Xiaoping, converted the PRC economy to capitalism, Chinese “social scientists” went to work trying to figure out what makes capitalists tick. They were quickly baffled. They kept running into problems; that “knack” we’ve got somehow eluded their new system. After a while, they figured out that the capitalists’ success couldn’t be entirely explained by the nuts and bolts of the marketplace, or by institutions like private property, important though they were. Yes, it would have been easier just to read Michael Novak’s magnum opus, but they got to his end place: religion is an essential part of successful capitalism.

In their amazing way of organizing most anything, the Chinese launched churches, and of course millions upon millions of them attended Christian (mostly Catholic) services. To be sure, the Party kept a suspicious eye wide open, and some of the churches were deemed too dangerous, even in the cause of Communism. But on they went, convinced they were on the right path. If anyone doubted it, they had mountains of research and even Tocqueville to justify the turn to religion.

After a couple of decades of this, there were still problems, and their social scientists took another look. This time around, they found–surprise!–lots of Jews involved in capitalist enterprises, from banks to stock exchanges to corporations. Indeed, the Jews had a history of doing it. Maybe the Jews knew something the others didn’t? Well, look at Israel…or New York…

And so they’re talking to Jews, not about capitalism but about Judaism. State radio now broadcasts in Hebrew. The Jewish experts who are brought to China find themselves speaking Hebrew with their Chinese interlocutors. Chinese students can now learn Hebrew, and immerse themselves in Jewish studies.

The world can sometimes be hilarious.

The National Socialist Alliance on Q&A

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Watching Q&A was more than usually entertaining. The real surprise to me was not that it happened but that it had never happened before. A live broadcast ought to have been a very tempting target. Yet for all their idiocies, it was the people on the panel who were the one’s that spooked me, specially Anna Burke who could not have been more out to lunch had she been scripted for it. I now think the Coalition will win the next election. Just get people like Burke back before a camera mouthing off the usual platitudes and the Libs will win in a walk.

In its own way what I found so pathetic about the protestors is how old time they are. We were doing the same ourselves back in the 1960s when it was new and fresh. Pathetic and disgusting but new and fresh. The left in both its tactics and ideas seems to be locked into a mould that ought to have died on the vine thirty years ago. But for all their empty rhetoric and curiously vacant ideas, these people are a high level danger to the social order. It reminded me of a recent post by Stacy McCain talking about American universities:

Scarcely a day goes by that we don’t hear some report of the increasing turn toward totalitarianism by the campus Left. Progressive hegemony on university faculties, a humanities curriculum heavily influenced by crypto-Marxist “theory,” and the radicalization of students through an identity-group Culture of Grievance, all contribute to this growing climate of intolerance. Administrators, when not actually in sympathy with the radicals, abdicate authority in the face of intimidation tactics employed by the militant Left at universities and colleges.

On a university campus few will stand up, often because administrators sympathise with those who protest. But to have taken their national socialist tactics into the greater world beyond the campus gates was a mistake. The usual Trot approach is the worse the better. The worse the establishment comes down on their heads, the better conditions will become in getting us to the revolution. They are likely to end up all the worse for what they did. Whether that leads to better as they define it, of this I have very great doubts.

A hundred photos to start the century

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The century is only a little over fourteen years and we began it in 2000 which isn’t technically correct but these are the iconic photos that best represent the century so far. They are in chronological order so that you can see the way the century has so far progressed. It also reminds you of how much we seem to have forgotten.

Yet its progressive left agenda is best represented by the absence of a photo of a plane being flown into the World Trade Center. Such imagery is verboten since it conjures up the wrong kind of thoughts in people about the menaces we face today. It reminds me more about what’s wrong and I fear it will only get worse.

The worst generation

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Who today could this be referring to? From Stacy McCain talking about American universities:

Scarcely a day goes by that we don’t hear some report of the increasing turn toward totalitarianism by the campus Left. Progressive hegemony on university faculties, a humanities curriculum heavily influenced by crypto-Marxist “theory,” and the radicalization of students through an identity-group Culture of Grievance, all contribute to this growing climate of intolerance. Administrators, when not actually in sympathy with the radicals, abdicate authority in the face of intimidation tactics employed by the militant Left at universities and colleges.

The Machal

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A video about the Machal, the pilots who comprised the Israeli airforce in 1948. A miraculous story, at the link a trailer for a film I intend to see.

My Uncle Harold was there, not as a flyer but as part of the ground crew, as he had been during the war in Europe along with my Uncle Percy. Bless them both.

The film is Above and Beyond. And as one of those interviewed said, a thousand years from now, as Jews look back on their history from what will then be 6774, the two moments they will remember of our present era are the Holocaust and the creation of the state of Israel. What else they will be compelled to remember of events during this coming one thousand years fills me with enormous fears.