Category Archives: Economic theory and policy

Only supply constitutes demand

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Other than straight out socialist plunder, no better way to comprehensively ruin an economy is to think public spending and monetary expansion can raise living standards and promote employment growth. Here’s an article by Richard Salsman published at The Hill in the US that tries to point out just that: Fiscal-monetary ‘stimulus’ is depressive.

Politicians, policy wonks and pundits like to classify as economic “stimulus” the $6 trillion in recent deficit spending and Federal Reserve money creation. But subsidies for the jobless, bailouts of the illiquid and pork for cronies are purely political schemes — and they depress the economy.

What is the case for “stimulus”? Many economists believe public spending and money issuance create wealth or purchasing power. Not so. Our only means of obtaining real goods and services is from wealth creation — production. Under barter no one comes to market expecting to buy stuff without also offering stuff. A monetary economy does not alter this key principle. What we spend must come from income, which itself must come from producing. Say’s Law teaches that only supply constitutes demand; we must produce before we demand, spend or consume. Demand is not a mere desire to spend but desire plus purchasing power.

Believers in “stimulus” also claim that government spending entails a magical “multiplier” effect on aggregate output, unlike most private sector spending. They tout a government’s greater “propensity to consume.” But consuming is the opposite of producing. Welfare states certainly consume and redistribute wealth. They divide it up. But math teaches that nothing – wealth included – can be multiplied by division. The so-called “multipliers” imagined by today’s economists are, in fact, divisors. Many studies have verified the principle.

It should become a pre-req for anyone to become a political leader to have successfully run a business for at least five years. Speaking of which I must also say how much I loved Tafkas’ post today.

A supply-side take on the PM’s package

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I have to say that I have been charmed by the approach taken by the Government to bring us out of the lockdown. I find this especially extraordinary:

“Value created by establishing successful products and services, the ability to be able to sell them at a competitive and profitable price and into growing and sustainable markets. It’s economics 101.“

Here’s the thing. It is not Economics 101 and has not been for two generations. It ought to be, but isn’t. Because this is an entirely supply-side statement. There is not an ounce of C+I+G anywhere to be seen. It is entirely about Value Adding as the absolutely necessary core for regenerating growth.

Keynesian economics may really be dead, and not a moment too soon.

Adam Smith and the Free Market

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A friend sent this along for comment.

Have Adam Smith and his writings been hijacked by free market economics?

Yes. Smith was deeply suspicious of the business class. When I was teaching, I used to give quotes without attribution for students to comment on, and they regularly treated Smith quotes as being from Marx. Smith knew nothing of capitalism, which barely existed in his day, and would be appalled by the idea of an economy based on a class of workers without property. His insight that people’s selfishness might produce collectively beneficial results (“the invisible hand”) has been taken over by so-called free market economics, and debased into a “greed is good” mantra that is totally antithetical to Smith’s teaching.

Smith complemented The Wealth of Nations with The Theory of Moral Sentiments, which explained that the moral sentiments of trust and compassion were required, among other things, to make a market economy operate at all. This idea has no role in “free market economics,” which imagines that economic actors are soulless egoists. Smith also maintained the first modern version of the labor theory of value, on which the exchange value of a commodity is the labor embodied in it. “Free market” economics rejects this in favor of a subjective theory of value on which price is determined entirely by supply and effective demand, what people with money will pay for it, because labor value is deemed “Marxist,” because Marx developed the most sophisticated version of value theory. A theory without labor value is not Smithian.

The problem here begins with knowing what is meant by “Adam Smith and his writings” and following that what is meant by “free market economics”. And then with making sense of “economic actors are soulless egoists” and “a ‘greed is good’ mantra”. Then beyond all of that, there is this which makes his argument utterly vacuous: “Marx developed the most sophisticated version of value theory” which he rounds us to “a theory without labor value is not Smithian” which means in his hands that only Marxists with their labour theory of value can truly state that they are following in the genuine tradition of Adam Smith.

Adam Smith is best understood via the invisible hand, that an economy is driven by individual decision making through entrepreneurial activity. The quotation is attempting to argue that Karl Marx is the true descendent of Adam Smith. Every aspect of this argument is false, an attempt to appropriate Smith, who advocated free markets, on behalf of Marx, who advocated a centralised tyranny in which markets play no role in directing resources towards their highest valued uses.

Reaping the whirlwind

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The video is on the simplistic side but is accurate enough. The point is that spending of itself doesn’t make your economy grow and more especially, able to repay a loan. Only value adding investment does that, investments where every dollar spent leads to output whose value is greater than a dollar. virtually no government ever does that, and when occasionally some government does, that government is not run by Daniel Andrews, nor, unfortunately, by Scott Morrison.

Let me continue along the same line of thought with this from Mises.org: Central Banks Are Destroying What Was Left of Free Markets. It is a more sophisticated version of what I wrote about earlier: “The best way to destroy the capitalist system is to debauch the currency”. The author here is Alasdair Macleod, “the Head of Research at Goldmoney”.

Those receiving subsidies and loan guarantees are no doubt grateful, though they probably see it as the government’s duty and their right. But someone has to pay for it. In the past, the redistribution of wealth through taxes meant that the haves were taxed to give financial support to the have-nots, at least that was the story. Today, through monetary debasement nearly everyone benefits from monetary redistribution.

This is not a costless exercise. Governments are no longer robbing Peter to pay Paul. They are robbing Peter to pay Peter as well. You would think this is widely understood, but the Peters are so distracted by the apparent benefits they might or might not get that they don’t see the cost. They fail to appreciate that printing money is not just the marginal source of financing for excess government spending, but that it has now become mainstream.

I will take you to the final para which ought to make you think very hard about where we are heading, but you may have to read the part in between, and perhaps also my own previous article to make sense of it. No one can know for sure, but why would you trust a central bank?

Earlier in the descent into the socialization of money, nations had opportunities to change course. Unfortunately, they had neither the knowledge nor the guts to divine and implement a return to free markets and sound money. Those opportunities no longer exist, and there can be only one outcome: the total destruction of fiat currencies, accompanied by all the hardships that go with it.

And while you are considering all this, let me bring this up as well: The Worldwide Lockdown May Be the Greatest Mistake in History.

The forcible prevention of Americans from doing anything except what politicians deem “essential” has led to the worst economy in American history since the Great Depression of the 1930s. It is panic and hysteria, not the coronavirus, that created this catastrophe. And the consequences in much of the world will be more horrible than in America.

Oh, really? How so?

The lockdown is “possibly even more catastrophic (than the virus) in its outcome: the collapse of global food-supply systems and widespread human starvation” (italics added). That was published in the left-wing The Nation, which, nevertheless, enthusiastically supports lockdowns. But the American left cares as much about the millions of non-Americans reduced to hunger and starvation because of the lockdown as it does about the people of upstate New York who have no incomes, despite the minuscule number of coronavirus deaths there. Or about the citizens of Oregon, whose governor has just announced the state will remain locked down until July 6. As of this writing, a total of 109 people have died of the coronavirus in Oregon….

Michael Levitt, professor of structural biology at Stanford Medical School and winner of the 2013 Nobel Prize in chemistry, recently stated, “There is no doubt in my mind that when we come to look back on this, the damage done by lockdown will exceed any saving of lives by a huge factor.”

To the left, anyone who questions the lockdown is driven by preference for money over lives. Typical of the left’s moral shallowness is this headline on Salon this week:

“It’s Time To Reject the Gods of Commerce: America Is a Society, Not an ‘Economy,’” with the subhead reading, “America Is About People, Not Profit Margins.”

And, of course, to smug editors and writers of The Atlantic, in article after repetitive article, the fault lies not with the lockdown but with President Donald Trump. The most popular article in The Atlantic this week is titled “The Rest of the World Is Laughing at Trump.” The elites can afford to laugh at whatever they want. Meanwhile, the less fortunate — that is, most people — are crying.

Maybe a year from now we will be looking back at all this and laughing. Or maybe not.

“The best way to destroy the capitalist system is to debauch the currency”

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Can you guess who said that?

Something that I have focused on in my Classical Economic Theory and the Modern Economy, but which is an otherwise unknown consequence of the Keynesian Revolution, was the shift in emphasis from the real side of the economy to the monetary side. If one is to understand the operation of an economy it is essential firstly to look at the actual real level of activity and only then look at the monetary side that lies above it and largely outside of it. Every classical economist understood the point. Virtually no modern economist does, and certainly no one without a serious study of economics ever does, which really does mean that near enough no one at all any longer understands this even slightly. Which leads me to this: Pandemic moves Modern Monetary Theory from the fringes to actual US policy.

[Modern Monetary Theory (MMT)] has received increased publicity over the past three years as politicians realized there was not a plausible plan to raise the funds necessary to fund “Healthcare for All,” the “Green New Deal,” free college and other initiatives through taxes alone.

The core principle of MMT is that sovereign governments with sovereign currencies can “print” or “coin” money to support full employment or essentially any government program that would benefit society in the here and now. Critics have labeled it the “Magic Money Tree Theory.” Those detractors include Keynesian and Monetarist economists, who cite Hungary in the 1840′s, Brazil in the 80′s, Mexico in the 90′s as examples of where easy money policies led to hyperinflation.

Warren Mosler was one of the founders of MMT, and what is known as `Mosler’s law’ states: “No financial crisis is so deep that a sufficiently large increase in public spending cannot deal with it.” These words fundamentally represent the actions our policy makers have taken in response to the virus. This pandemic has moved MMT from the fringes to the dead center as the actual monetary policy of the United States.

These are people with PhDs in economics who will comprehensively ruin us, and on this let me quote Keynes with absolute approval:

Lenin is said to have declared that the best way to destroy the capitalist system was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security but [also] at confidence in the equity of the existing distribution of wealth….

As the inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless; and the process of wealth-getting degenerates into a gamble and a lottery.

Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.

It was Lenin who said it, but quoted by Keynes as a warning to us all. Are you that one in a million who sees the point? Well if you are, there are then the other 999,999 who do not, which includes every single political leader heading every single government across the Western world today, each one of whom is engaging “all the hidden forces of economic law on the side of destruction”.

“More people will die from the measures than from the virus”

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An interview with Yoram Lass, “the former director of Israel’s Health Ministry, on the hysteria around Covid-19”: ‘Nothing can justify this destruction of people’s lives’ at Spiked. Read it all, but this is how it opens – I have left out the questions that these are the answers to:

Yoram Lass: It is the first epidemic in history which is accompanied by another epidemic – the virus of the social networks. These new media have brainwashed entire populations. What you get is fear and anxiety, and an inability to look at real data. And therefore you have all the ingredients for monstrous hysteria.

It is what is known in science as positive feedback or a snowball effect. The government is afraid of its constituents. Therefore, it implements draconian measures. The constituents look at the draconian measures and become even more hysterical. They feed each other and the snowball becomes larger and larger until you reach irrational territory. This is nothing more than a flu epidemic if you care to look at the numbers and the data, but people who are in a state of anxiety are blind. If I were making the decisions, I would try to give people the real numbers. And I would never destroy my country.

Mortality due to coronavirus is a fake number. Most people are not dying from coronavirus. Those recording deaths simply change the label. If patients died from leukaemia, from metastatic cancer, from cardiovascular disease or from dementia, they put coronavirus. Also, the number of infected people is fake, because it depends on the number of tests. The more tests you do the more infected people you get.

The only real number is the total number of deaths – all causes of death, not just coronavirus. If you look at those numbers, you will see that every winter we get what is called an excess death rate. That is, during the winter more people die compared to the average, due to regular, seasonal flu epidemics, which nobody cares about. If you look at the coronavirus wave on a graph, you will see that it looks like a spike. Coronavirus comes very fast, but it also goes away very fast. The influenza wave is shallow as it takes three months to pass, but coronavirus takes one month. If you count the number of people who die in terms of excess mortality – which is the area under the curve – you will see that during the coronavirus season, we have had an excess mortality which is about 15 per cent larger than the epidemic of regular flu in 2017.

Compared to that rise, the draconian measures are of biblical proportions. Hundreds of millions of people are suffering. In developing countries many will die from starvation. In developed countries many will die from unemployment. Unemployment is mortality. More people will die from the measures than from the virus. And the people who die from the measures are the breadwinners. They are younger. Among the people who die from coronavirus, the median age is often higher than the life expectancy of the population. What has been done is not proportionate. But people are afraid. People are brainwashed. They do not listen to the data. And that includes governments.

Much more at the link. And speaking of outcomes of Biblical proportions, there is also this to think about.

Two weeks ago, when looking at the recent flurry of chapter 11 filings and a striking correlation between the unemployment rate and loan delinquencies, we said that a “biblical” wave of bankruptcies is about to flood the US economy.

It now appears that the wave is starting to coming because according to Fitch, the monthly tally of defaults in the U.S. leveraged loan market has hit a six-year high, as companies are either missing payments or filing for bankruptcy because of the fallout from the coronavirus pandemic.

Speaking biblically again, there is no doubt that governments around the world have sown the wind. You know what comes next.

“I foresee the worst depression since the Great Depression right around the corner”

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I am grateful again for the moderator at the Societies for the History of Economics discussion thread for putting up another review of The Price of Peace, the book subtitled, “Money, Democracy and the Life of John Maynard Keynes. This review is from The New York Times. More of the usual mythology.

Carter’s explications of macroeconomic theory are so seamlessly woven into his narrative that they’re almost imperceptible; you only notice how substantive they are once you get to his chapter on Keynes’s notoriously dense 1936 book, “The General Theory of Employment, Interest and Money,” and realize that you’re riveted by a passage on fluctuations in liquidity preference because you somehow know exactly what it is that Carter is talking about.

“The General Theory” aside, the rough outline of the Keynes story is that nobody with any power listened to his visionary proposals before the crisis of the Depression hit; after that, almost everyone did. Keynes’s ideas were radical, Carter writes, but he was staunchly anti-revolutionary: Having been traumatized by World War I, Keynes was at pains to persuade some of his Marxist students at Cambridge that a more just and equitable society didn’t have to come at the point of a gun. An activist government and deficit spending could alleviate suffering and spur growth, he reasoned, and the world eventually obliged. As much as Franklin Roosevelt didn’t like running a deficit, his New Deal offered one version of how Keynesianism worked; World War II offered another.

Of course, Harry Truman offered a third version. At the end of World War II, Truman immediately sacked all of the millions who had been in the armed forces and closed virtually the entire armaments industry, thus creating the largest mass of unemployed people in history. At the same time, and immediately the war was over, he balanced the budget, eliminating the largest deficit as a proportion of GDP in history. And the result: the largest and most sustained period of growth in history. I might contrast The Price of Peace and its review with this: The Politics of Fear, whose sub-title is, “For economist Robert Higgs, Covid-19 is just the latest emergency justifying expanded government power”. Lots there to ponder, and it should all be read, but will merely quote this:

“I foresee the worst depression since the Great Depression right around the corner. That alone would be enough to bring forth a host of bad government policies with long-lasting consequences. Many such policies have already been adopted. But much more awaits us along these lines.”

And there is no doubt that the reviewer sees “The Price of Peace” as relevant to bringing our economies out of the present lockdown. This is from her opening para:

Zachary D. Carter’s outstanding new intellectual biography of John Maynard Keynes, offers a resonant guide to our current moment, even if he finished writing it in the time before Covid-19.

There have been so many breakages in our structure of production in the past few months there is nothing that might not yet happen, and there is no telling how bad it might get. We are so far beyond anything that Keynes ever wrote about or dealt with that calling up his name is a total irrelevance. Does it no longer ever occur to most economists to leave things to the market to sort themselves out?

Models are not evidence

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Seems sensible to me.

Models are not scientific evidence. Evidence is proof of something that has already happened. Model predictions have not happened.

Repeat it with me:

Models are not evidence.

Models are not evidence.

Models are not evidence.

This is true about lots of things, specially in economics. First the conception, then the model, then the real world, then the application, then the failure and then the forgetting about what happened so that the same mistakes can be made all over again.

Models are not evidence was a comment on this post at Instapundit. Along with these.

If there is a silver lining to this event, perhaps it will be that more people will come to understand why the models for climate change should not be taken as gospel. Models are based on assumptions, and the more complex the model, the greater the number of assumptions. When our so-called experts were so wrong with the models for a virus that acts much like many other similar viruses, how the heck can anyone expect experts to correctly model the interaction of everything in the earth’s atmosphere? It makes no sense.

Everyone’s got a cold, let’s shut the economy down. The hyperbole is strongly on the side of the jackboots.

If you want to live in fear, stay in your stinking lair and obey your government masters, you quivering slave.

It’s going to be fun watching the Blue City State folk impoverish themselves in an attempt to damage Trump’s re-election. While the rest of us are at work, restaurants, gyms, shopping, etc. At some point, they will have to throw in the towel and grudgingly rejoin the rest of the country, with the (delicious, to me) knowledge that this will enable Trump 2020.

I always ask them “why not lower the speed limit to 25mph too? If it saves one life…”

Don’t mean to be argumentative, but GIGO is only part of the problem. In all modeling software the data inputs are usually “tuned” by weighting factors. These factors are sometimes based on experiential data matrices or historical observations and collective norming, but at times they are little more than “knowledgeable estimates.” With experience – a whole lot of detailed experience – a model designer can fine tune the formulation and weighting factors to increase accuracy but this process is often somewhat less than rigorous “scientific method.” Consequently, in some instances, “modeling” is little more than a fancy word for guessing.

When they drew the line in the sand back at the start of March, Sarah was the only mod here who backed a free people and supported individual liberty. The rest went apocalyptic, demanding we sacrifice our rights for the common good (Yes, Glenn Reynolds wrote a USA Today article using that phrase), and screaming that the authorities weren’t locking us down fast enough. When push comes to shove, I know Sarah will support me and my freedoms, and that the rest of the mods here will happily sacrifice me. Don’t ignore that very important data point.

Mill and marginalism

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A conversation based on John Stuart Mill and the theory of value.

PETER:

Obviously I don’t find this stuff as interesting as you do. But have just, admittedly quickly, looked at JSM’s theory of value. I can’t see how this stacks up: “almost equally disastrous [as the Keynesian Revolution] was the Marginal Revolution which undermined the classical theory of value”. Which of Mill’s 17 propositions does it undermine?

ME:

The Marginal Revolution starts with Marginal Utility. And let me mention that Mill was the greatest and most influential utilitarian philosopher in history, yet he absolutely refused to incorporate utility into his economic analysis, as noted here. The abstract begins:

“The concept of utility, which stood at the heart of J. S. Mill’s utilitarian moral philosophy, played only a minor role in his account of economics. The economic idea of (individual) utility, as is well known, neither inspired Mill directly nor excited his attention when developed in the work of other economists.”

And the reason in part, as discussed in my forthcoming book, was, and I argue from plenty of evidence, that the introduction of utility took the analytics of the economy from the supply side to the demand side. Lots of other things I could say and do say, but I hope this is enough for you to see my point. In my textbook I go into it in much more detail but do preserve cost-benefit analysis as part of what an economist needs to understand.

There are around 1200 economists on that website but I doubt any of them will want to buy into any of this and they are typically a fractious lot. Not that it’s the reason I bought into this query, but it did stoke my annoyance that it is the editor of our local journal, who want to dispose of the two papers, including mine, that he has held in his hands for two years, that asked the initial query which began thus:

My long message emerges from a series of papers I have received from a retired physicist, Kevin Wilks, who is 95 and argues (as physicists are wont to do) that laws of physics underlie economics, in this case production itself and the industrial structure. Economies capture energy and convert it into value (my summation). He draws on Quesnay and the primacy of agriculture, which I [is] why I write to SHOE for help, both to advise Kevin and to sort things out in my own head. And perhaps Kevin is onto something; if so, it is not straight HET, so what journals or outlets cater for speculative papers by intelligent amateur economists? The main concern here is not what Quesnay really said, but why what is valid in Quesnay is absent from textbooks. Wilks argues that introductory economics should locate the dependency of what we now call the secondary and tertiary sectors on the primary sector. Textbooks would be written differently. Of course, what is valid in a body of thought need not be regarded as important, but I press on.

This chap is a complete economic illiterate who thinks that economics should be reduced to energy flows – an old and idiotic economic concept that completely omits the notion of value and pricing. My article on Mill is however beyond his ken. Is it any wonder that economics has stagnated for the past hundred years, if not actually going backwards? Actually it has gone backwards, but who is this cretin to notice? This is why it is so difficult to get published when trying to say anything against modern textbook theory runs such obstacles as this. It’s only fortunate that I am now beyond the realm of publish or perish.

PETER:

Marginal utility is a demand concept for sure but I would have thought the fault which led to Keynes was the focus on demand as an aggregate not on demand per se.

ME:

Want more? Utility cannot be measured and in any case has nothing to do with relative prices, whereas the supply side of the economy and the cost structure of the economy is the way in which the resource base is allocated to different outputs.

No classical economist bought the marginal stuff in the English speaking world until Joan Robinson and Edward Chamberlain turned the concepts into diagrams.

And fwiw, marginal utility has disappeared from our texts and been replaced by indifference curves, which are just as useless, and also unmeasurable.

PLUS THIS:

And this from “The Physiocrats and Say’s Law of Markets”. I by Joseph J. Spengler.

The Physiocrats and Say’s Law of Markets. I
Author(s): Joseph J. Spengler
Source: Journal of Political Economy, Vol. 53, No. 3 (Sep., 1945), pp. 193-211

The physiocrats always expressed their theory of circular flow in interclass, rather than in interindividual, terms. Notwithstanding, their theory of circular flow forced upon them several conclusions of importance. They looked upon money as an instrument whose essential function it is to facilitate the circulation of goods and services, to serve as a medium of exchange. In consequence, they recognized that commerce consists, not in buying and selling, but in the exchange of goods and services for goods and services. They thus laid the ground work for the formulation of Say’s law of markets and evoked its actual statement by their treatment of consumption and expenditure. They recognized, too, that if money ceases to perform its function, the nexus between potential purchasers and potential sellers is broken, thus anticipating Keynes; but they did not develop this theory, for they supposed that in a healthy economy founded upon their principles money would always perform its proper function. (p. 205)

 
Notable here is that goods exchange for goods and the circular flow is in real terms with money facilitating the exchange. This is what Say himself would include in his Treatise in 1803. What Keynes did was recast the entire process into a circular flow of money forgetting to separate out and on their own the real exchanges that simultaneously occur. In a Keynesian model, and therefore in modern macro, the real half of the process is no longer distinguished and discussed.

Lucky country no more

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This sort of thing is always news to politicians, most of the community and to almost all economists: The Economy Doesn’t Need Government ‘Help’ To Reopen.

Governments don’t create economies. It’s not only beyond their legitimate functions, it’s beyond their abilities. They need to stay out of the way and let the wisdom of markets steer us back to normal.

“The wisdom of markets!” Do you think Dangerous Dan Andrews would have any idea what that means? There are many others I would ask that same question of but will leave it there. Because this is the reality that comes in the very next sentence after.

But some officials see an opening through which they can drive their big government dreams.

These people are incompetent to direct an economy. Or let me put it this way. THESE PEOPLE ARE INCOMPETENT TO DIRECT AN ECONOMY. This is Daniel Andrews bio from Wikipedia.

Andrews was born in Williamstown, a suburb of Melbourne, to Bob Andrews (1950–2016) and Jan (born 1944). In 1983 his family moved to Wangaratta, where he was educated at the Marist Brothers‘ Galen Catholic College.[1] Andrews moved back to Melbourne in 1990 to attend Monash University, where he was a resident of Mannix College and graduated with a Bachelor of Arts degree in politics and classics in 1996. After graduating, Andrews became an electorate officer for federal Labor MP Alan Griffin. He worked at the party’s head office from 1999 to 2002, initially as an organiser, and then as assistant state secretary.

Following his election to parliament in the Legislative Assembly seat of Mulgrave at the 2002 election, Andrews was appointed Parliamentary Secretary for Health in the Steve Bracks Labor government. Following the 2006 election, Andrews was appointed to the Cabinet, becoming Minister for Gaming, Minister for Consumer Affairs and Minister Assisting the Premier on Multicultural Affairs. In 2007, Andrews became Minister for Health in the John Brumby Labor government….

Brumby resigned as leader of the Victorian Labor Party following the Labor defeat at the 2010 election, after 11 years of Labor governments. On 3 December 2010, Andrews was elected Victorian Labor Party leader, becoming Leader of the Opposition in Victoria.

At the [2014] election, Labor gained seven seats for a total of 47, a majority of two.

And thus Daniel Andrews, economic cypher but socialist extrordinare became premier. And now he not only guides Victoria right towards the rocks, but he is signalling the way for the Feds to do the same. Shall I mention Scott Morrison and his career. Why not?

Morrison was born in Sydney and studied economic geography at the University of New South Wales. He worked as director of the New Zealand Office of Tourism and Sport from 1998 to 2000 and was managing director of Tourism Australia from 2004 to 2006. Morrison was also state director of the New South Wales Liberal Party from 2000 to 2004. He was later elected to the House of Representatives at the 2007 election, representing the Division of Cook in New South Wales.

Etc etc. And just how on top of things is our PM? The news just in: Scott Morrison to push for WHO to be given ‘weapons inspector powers’.

Australia will push for the World Health Organisation to be given the powers of an international “weapons inspector” that would be mandated to enter a country without invitation to trace the source of outbreaks in any future pandemics.

It is believed that Scott Morrison raised the idea with world leaders over the past several days while seeking a consensus for reform of the organisation be given priority and should not wait for any review or investigation into COVID-19 pandemic which could take as long as five years.

It is believed that Scott Morrison raised the idea with world leaders over the past several days while seeking a consensus for reform of the organisation be given priority and should not wait for any review or investigation into COVID-19 pandemic which could take as long as five years.

Let me add that after all this disruption, the most useful way to get us back to something like how things only so recently were is not to disrupt markets any further but just let conditions work themselves out on their own. Gently, gently. Thus we have the Head of the RBA coming up with this:

Handing down a detailed assessment of the damage being wrought by the COVID-19 pandemic, Dr Lowe warned that the nation could not rely on a quick return to a pre-coronavirus economy and suggested long-ignored calls for income, consumption and land tax reform, as well as stripping regulations that stifle innovation, would need to be revived.

Does no one in charge know how to run an economy any more?