“Are economists idiots?” he asks

This is the title Are Professional Economists Idiots? and this is how it begins:

Taleb, a libertarian, aims his critique of intellectuals yet idiots (IYI) broadly but particularly at the contemporary economics profession. His targets are those described by the Mises Institute:

“The professional economist is the specialist who is instrumental in designing various measures of government interference with business.”

The economics profession in the U.S. today is mostly involved in research and education that broadly investigates “market failures” or is directly engaged in public action – regulation, tax, expenditure and off budget guarantees – to manage industries and the macro-economy purportedly in the public interest. This is the opposite of laissez faire economics, political advice to a 17th century French minister to “let it be” later developed into an economic theory by the 18th century philosopher Adam Smith and popularized by 20TH century economist Milton Friedman, a libertarian and cofounder of FFE (and my advisor, twice removed). How and to what end did the economics profession evolve from a philosophy of leaving economic decisions to individuals in the marketplace with few exceptions to public economic management of the United States and global economy?

The real answer is that economists are like everyone else, that they will follow their own self-interest. And if people demand idiotic answers to their questions, they will supply them. For proof, see modern macro.

Bryan Noakes (1930-2020)

The less anyone notices the workings of the Industrial Relations system, the better it is actually working. Bryan Noakes passed away yesterday and this is in memoriam. I will just add that no one has had more influence on my professional life than Bryan who employed me at the Confederation of Australian Industry in 1980 where I continued as its Chief Economist until 2004. And as a personal memory, it is Bryan sitting across the table from Bob Hawke negotiating some agreement. You need a phlegmatic personality and a cast-iron constitution to sit through such moments – which I do not have – without getting angry but just get back into it for hours on end. Bryan did enormous amounts on behalf of this country that no one outside a small group within the “Industrial Relations Club” will ever have the slightest idea about.

One of Australia’s leading employer advocates both nationally and internationally, Bryan Noakes, died on Tuesday at the age of 89 after years of ill-health.

Noakes served in leading and senior positions with the Australian Chamber of Commerce and Industry (ACCI) and its predecessors from the 1960s through to the early 2000s.

In 2001, when he retired as ACCI’s director-general (industrial), he said the highlights of his career had been the achievement of labour market reforms in the 1980s and 1990s and steering the Confederation of Australian Industry’s 1991 landmark policy shift away from support for a centralised IR system.

His ACCI successor Peter Anderson, now a Fair Work Commission deputy president, said Noakes’ contribution to the national IR system had been formidable.

Even after his retirement he had continued to be a source of counsel to many, “myself included”.

“He was a serious man but did not take himself too seriously,” Anderson said.

“With his passing, and that of Bob Hawke and George Polites in the same 12-month-period, it is the end of an era of three industrial relations giants of our past generation.”

Bryan Noakes joined the Australian Council of Employers’ Federations (ACEF) in the early 1960s as an IR advisor on major construction projects, after cutting his teeth on the Snowy Mountains hydroelectricity project.

He eventually became the director-general of the Confederation of Australian Industry (which succeeded the ACEF) after the retirement of George Polites in 1983 and continued in a leading role with the formation of ACCI in 1992.

In a statement this week, ACCI described Noakes as a “significant, respected and well-liked figure across the political and industrial divide”.

He had worked “tirelessly” to represent the business community over a period of profound challenges in Australian industrial relations and resulting legislative reform under the Hawke, Keating and Howard governments.

Another FWC member and ACCI colleague, Deputy President Reg Hamilton, said Noakes’ advocacy had played a major role in tribunal decisions and the major legislative changes of 1988, 1993 and 1996.

“He was able to judge proportionality well and avoided the obvious mistakes of appeasement or extremism.

“He also had good personal relationships with nearly everyone.”

While Noakes retired from ACCI in 2001, he completed his term (in 2004) as a member of the governing body of the International Labour Organisation, representing Asia-Pacific employers.

Deputy President Anderson said it was in the international arena where Noakes’ “star shined most brightly” and his “patient but firm advocacy” prompted governments to improve law and practice on industrial issues.

In its statement ACCI said Noakes won recognition for his significant work protecting the fundamental rights of both employers and trade unionists throughout the world through the ILO’s Committee on Freedom of Association (CFA) and had been instrumental in the creation of an employer voice for the Asia Pacific region, through the Confederation of Asia Pacific Employers (CAPE).

ACCI workplace relations director Scott Barklamb said the perspectives Noakes developed from four decades at the peak of Australian and global IR continued to inform the work of ACCI.

“Union and employer colleagues throughout the world ask after Bryan to this day and express their profound respect and appreciation for his work, particularly as a leading figure in the ILO’s Committee on Freedom of Association (CFA).”

In 2003 Noakes became an Officer of the Order of Australia (AO) for his “service to industrial relations in Australia and overseas through policy development, fostering improved relations between employers and employees and as an expert in the area of international labour law” (see Related Article).

In February last year he attended a memorial celebration following the death of his former colleague and leader George Polites who he described as an influential figure who “always had a solution and it always worked”.

Just three months later he was paying tribute to another contemporary, former Prime Minister and ACTU secretary Bob Hawke.

“It is a cause for pause and reflection that two of our nation’s greatest industrial figures, Bob Hawke and George Polites respected differences, found common interest and have now passed at grand ages within months of each other,” he said in a personal statement following Hawke’s death.

What’s the difference between a crooked pathological liar and a Democrat politician?

Nothing.

Adam Schiff Tries to Make Impeachment
About ‘Russia Collusion’ Hoax
Posted by earlybird — 1/22/2020 4:40:51 PM Post Reply
Lead House impeachment manager Rep. Adam Schiff (D-CA) led his opening argument in the Senate impeachment trial of President Donald Trump on Wednesday by citing allegations of “Russia collusion” that have been debunked. Schiff tried to argue that the Senate had a duty to remove President Trump from office for allegedly inviting foreign interference by Ukraine in the 2020 presidential election because he supposedly invited Russia to interfere in 2016. (Snip) Schiff was referring to a press conference in July 2016 at which Trump joked about Russia finding the approximately 33,000 emails that former Secretary of State Hillary Clinton had deleted from her illicit private email server.

Fact Check: Adam Schiff Falsely Claims
Trump Conditioned Meeting, and Aid, on
Investigations
Posted by earlybird — 1/22/2020 4:24:39 PM Post Reply
CLAIM: President Donald Trump withheld a White House meeting, and military aid, from Ukraine until it agreed to announce investigations. VERDICT: False. There is no direct evidence of that in the entire House record. Lead House impeachment manager Rep. Adam Schiff (D-CA) laid out the case against President Trump in opening arguments on Wednesday in the Senate impeachment trial. The core of his claim was that Trump withheld a White House meeting from new Ukrainian President Volodymyr Zelensky, as well as essential military aid, unless and until Ukraine announced investigations into former Vice President Joe Biden and 2016 interference in the U.S. election. Every part of that claim is untrue, and

Breaking Bombshell: Elizabeth Warren’s
Son-in-Law Produced Film Funded by
Iranian Government
Posted by earlybird — 1/22/2020 4:16:56 PM Post Reply
Democrat presidential candidate Sen. Elizabeth Warren’s (D-MA) son-in-law, with whom she is close, has troubling ties to the Iranian regime, according to a new book by Peter Schweizer. The book, Profiles in Corruption, reveals progressive leaders’ little-known ties to corrupt businesses and governments and discusses the Massachusetts senator in a chapter. The chapter details the business deals of Warren’s son-in-law, Sushil Tyagi, who is married to her daughter, Amelia. (Snip) Since his marriage into the Warren family, Tyagi “has been involved in a series of curious—even troubling—business ventures around the world,” Schweizer writes.

Book Bombshell: James Biden’s Firm
Got $1.5 Billion in Government Contracts
Despite Zero Experience
Posted by earlybird — 1/22/2020 4:08:19 PM Post Reply
A firm employing James Biden, the younger brother of former Vice President Joe Biden, received more than $1.5 billion in government-backed contracts during the Obama administration. The dovetailing of James Biden’s professional life with his brother’s political influence is extensively detailed in Profiles in Corruption: Abuse of Power by America’s Progressive Elite—a new book by Peter Schweizer, (Snip) In 2010, shortly after a disastrous attempt at running a hedge fund with his nephew Hunter, James Biden entered the construction and international development industry. Even though he lacked background in either, James secured a position as executive vice president at the newly formed HillStone International, LLC.

Schiff may have mischaracterized
Parnas evidence, documents show
Posted by earlybird — 1/22/2020 3:17:00 PM Post Reply
House Intelligence Chairman Adam Schiff appears to have mischaracterized a text message exchange between two players in the Ukraine saga, according to documents obtained by POLITICO — a possible error the GOP will likely criticize as another example of the Democrats’ rushed effort to impeach President Donald Trump. The issue arose when Schiff (D-Calif.) sent a letter to House Judiciary Chairman Jerry Nadler (D-N.Y.)(Snip) summarizing a trove of evidence from Lev Parnas, (Snip). In one section of the letter, Schiff claims that Parnas “continued to try to arrange a meeting with President Zelensky,” citing a specific text message exchange where Parnas tells Giuliani: “trying to get us mr Z.”

Media in Davos confronts Trump on Greta
Thunberg; his answer makes them and
her look foolish
Posted by Imright — 1/22/2020 1:46:07 PM Post Reply
To hear the media tell it, President Donald Trump “slammed” child climate activist Greta Thunberg during a press conference Wednesday at the World Economic Forum, which is taking place in Davos, Switzerland. To that end, the president commented on Thunberg making the cover of Time before him — in a political maneuver, the child activist was named Time Magazine’s ‘Person of the Year’ in 2019.In his opening address at the annual meeting, the president warned the assembly about the hysteria over climate change, saying alarmists are “radical socialists,” the Washington Examiner reported.

________

All from Lucianne.com all at around the same time.

Australia’s bushfires all you need to know

This is dead on: Media more destructive than fires:

Just like many other people I know, I have been inundated by messages from family and friends overseas, inquiring about my safety, having been terrified by the media reports of what seemed like an environmental armageddon engulfing the entire country….

Watching the hysterical and over-sensationalised coverage overseas has convinced many that the very existence of the nation is at stake. And the social media, if anything, has been even worse, with a number of completely misleading maps and photos exaggerating the extent of the affected areas by two-figure factors. As I pointed out, indeed the area the size of the state of Kentucky has been burned out, but unlike most other places on Earth, certainly in the developed world, Australia fits in nearly eighty Kentuckys, most of them pretty empty of human presence and activity.

Media sensationalises at the best of times in a never-ending quest for more eyeballs (“if it bleeds it leads”, or, in this case, “if it’s on fire, we’re on fire”) but the intersection of a large scale natural disaster with the “climate crisis” activism has generated a truly terrifying inferno of human passions where news becomes propaganda and the narrative trumps the objectivity. A significant proportion of the population – and the majority in the media – want to see the fires as Gaia’s wrath, with the disaster turning into green porn to terrify, titillate and agitate. Tourism has now become one of the casualties of this rhetorical excess, a collateral damage to the pursuit of a political agenda. This crisis is very much man-made and the economic pain unnecessarily inflicted on a whole industry because you wanted to make as terrible a point as possible will hang around your necks like a charred albatross, dear green activists on the streets and those masquerading as journalists.

Plus:

Not to mention:

Impeachment all for show

Made it back from the US where they had just begun the impeachment business. And in the hotel we were staying at – perhaps explicable because we were in California – it was MSNBC running in the restaurant night and day. My conclusion: in comparison CNN is balanced and fair. Non-stop with the occasional moment of foreign news devoted to bushfires in Australia.

The enforced media-driven ignorance of the American population is startling. The hatred towards PDT you come across everywhere is incredible. The ayatollahs of the American networks could not be more one-sided.

As for the impeachment here are the Senate draft rules.

Essentially, the impeachment trial will be gone in about a week and then it’s on to the State of the Union. The Democrats assume that not only is a week a long time in politics, four years and ten months is an eternity. Nothing going on today will matter then. They are giving away 2020 and waiting for 2024 where the present crew and the present political set of “leaders” and their arguments will have discredited themselves. Not that I think that the Dem nominee cannot win, but I do think there are enough Democrats who hope whomever it is does not win.

And while the tweet below is a bit old, it is dead on for me.

The Harding recovery of 1921

From The Mises Institute: “The Forgotten Depression of 1920” by Tom Woods. At the height of the GFC in 2009 as public sector spending to cure the recession was moving into high gear, he wrote:

Little, if any, public mention is ever made of the depression of 1920–1921. And no wonder — that historical experience deflates the ambitions of those who promise us political solutions to the real imbalances at the heart of economic busts.

So what did Harding do, and how did it all work out?

The conventional wisdom holds that in the absence of government countercyclical policy, whether fiscal or monetary (or both), we cannot expect economic recovery — at least, not without an intolerably long delay. Yet the very opposite policies were followed during the depression of 1920–1921, and recovery was in fact not long in coming.

The economic situation in 1920 was grim. By that year unemployment had jumped from 4 percent to nearly 12 percent, and GNP declined 17 percent. No wonder, then, that Secretary of Commerce Herbert Hoover — falsely characterized as a supporter of laissez-faire economics — urged President Harding to consider an array of interventions to turn the economy around. Hoover was ignored.

Instead of “fiscal stimulus,” Harding cut the government’s budget nearly in half between 1920 and 1922. The rest of Harding’s approach was equally laissez-faire. Tax rates were slashed for all income groups. The national debt was reduced by one-third.

According to economist Benjamin Anderson quoted by Wood, a name you will not know, but an active anti-Keynesian from the 1940s:

“In 1920–21,” writes Anderson, “we took our losses, we readjusted our financial structure, we endured our depression, and in August 1921 we started up again.… The rally in business production and employment that started in August 1921 was soundly based on a drastic cleaning up of credit weakness, a drastic reduction in the costs of production, and on the free play of private enterprise. It was not based on governmental policy designed to make business good.”

Harding had done what he said he would do. More from Tom Woods:

In his 1920 speech accepting the Republican presidential nomination, Harding declared,

We will attempt intelligent and courageous deflation, and strike at government borrowing which enlarges the evil, and we will attack high cost of government with every energy and facility which attend Republican capacity. We promise that relief which will attend the halting of waste and extravagance, and the renewal of the practice of public economy, not alone because it will relieve tax burdens but because it will be an example to stimulate thrift and economy in private life.

Let us call to all the people for thrift and economy, for denial and sacrifice if need be, for a nationwide drive against extravagance and luxury, to a recommittal to simplicity of living, to that prudent and normal plan of life which is the health of the republic. There hasn’t been a recovery from the waste and abnormalities of war since the story of mankind was first written, except through work and saving, through industry and denial, while needless spending and heedless extravagance have marked every decay in the history of nations.

Wood goes on:

Many modern economists who have studied the depression of 1920–1921 have been unable to explain how the recovery could have been so swift and sweeping even though the federal government and the Federal Reserve refrained from employing any of the macroeconomic tools — public works spending, government deficits, and inflationary monetary policy — that conventional wisdom now recommends as the solution to economic slowdowns. The Keynesian economist Robert A. Gordon admitted that “government policy to moderate the depression and speed recovery was minimal. The Federal Reserve authorities were largely passive.… Despite the absence of a stimulative government policy, however, recovery was not long delayed.”

Australia, by the way, did the same with the same result in the 1930s. Who remembers? Unless it’s true in theory it can never have been true in practice.

Why is Robert Skidelsky speaking at Mont Pelerin??

I’m off to the regional meeting of the Mont Pelerin Society in Palo Alto which is the meeting of the remnants of the last few remaining supporters of market economies not only as the means to prosperity, but also as a necessary element in the preservation of political freedom.

So imagine my astonishment to see this as one of the sessions being on offer:

1:15 pm – 2:30 pm Lessons Learned from History for the Future of Freedom
Gabriel Calzada, Universidad Francisco Marroquín (Chair)
Victor Davis Hanson, Hoover Institution
Amity Shlaes, Calvin Coolidge Presidential Foundation
Robert Skidelsky, Warwick University

This is from Robert Skidelsky’s Wikipedia page:

In September 2015, Skidelsky endorsed Jeremy Corbyn’s campaign in the Labour Party leadership election, writing in The Guardian: “Corbyn should be praised, not castigated, for bringing to public attention these serious issues concerning the role of the state and the best ways to finance its activities. The fact that he is dismissed for doing so illustrates the dangerous complacency of today’s political elites. Millions in Europe rightly feel that the current economic order fails to serve their interests. What will they do if their protests are simply ignored?”

As a minor matter next to this, but not minor to me, is that he is the most prominent defender of Keynesian economics, along with Paul Krugman, anywhere in the world. There is also a fact virtually unmentioned on his own Wikipedia page but mentioned here in relation to a disgraceful book he published at the start of the GFC: Keynes: The Return of the Master.

Keynes: The Return of the Master is a 2009 book by economic historian Robert Skidelsky. The work discusses the economic theories and philosophy of John Maynard Keynes, and argues about their relevance to the world following the Financial crisis of 2007–2010.

I’m not surprised he is reluctant to have the book mentioned. Want more? From the same source:

Chapter 8 sums up Keynes’s relevance to the current age as of 2009. The author suggests that Keynes would likely advise us to rethink macroeconomic policy, with a greater emphasis on balanced growth and with a somewhat large role for government in ensuring there is a smooth flow of investment to help protect the economy from unpredictable shocks. Macroeconomics should be reformed so that it again recognises the role of uncertainty and so it draws on other areas of knowledge such as history and International political economy, with a less central role for maths. The global savings glut needs to be addressed. Ethics should once again have a role in guiding capitalism, as should Keynes’s vision of harmony, where differences are cherished rather than pressured to conform, as can be the case with current concepts of “social cohesion” and “consensus”.

Why is such an out and out socialist being allowed to speak at Mont Pelerin? And on that minor matter of Keynes, this is the most recent cover description for my next book which I have just sent to the publisher.

Classical Economic Theory and the Modern Economy’

Steven Kates

Economic theory reached its highest level of analytical power and depth in the middle of the nineteenth century among John Stuart Mill and his contemporaries. This book explains classical economics when it was at its height, followed by an analysis of what took place as  a result of the ensuing Marginal and Keynesian Revolutions that have left economists less able to understand how economies operate.

Chapters explore the false mythology that has obscured the arguments of classical economists, clouding to the point of near invisibility the theories they had developed. Kates offers a thorough understanding of the operation of an economy within a classical framework, providing a new perspective for viewing modern economic theory from the outside. This provocative book not only explains the meaning of Say’s Law in an accessible way, but also the origins of the Keynesian revolution and Keynes’s pathway in writing The General Theory. It provides a new look at the classical theory of value at its height that was not based, as so many now wrongly believe, on the labour theory of value.

A crucial read for economic policy-makers seeking to understand the operation of a market economy, this book should also be of keen interest to economists generally as well as scholars in the history of economic thought.