Tag Archives: economics

Zerohedge: Party Time Over, Fight Club Time Begins

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“Water, even when it’s polluted, is the source of life; blood, even when it’s carelessly spilled, is the symbol of life being fully lived. To put his point simply: it’s better to be wet than dry.”

—   Richard Schickel about “Fight Club”

Tyler Durden at Zerohedge says it’s time for the Paul grass-roots to grow out of politics and take their fire to the real world and the real fight: time to become self-sufficient, time to gain financial independence,  time to develop powerful networks, diversify your assets, travel or relocate abroad, if necessary, develop alternative currencies, new trading systems, new banks; counter-economics:

“It has become clear that Benton and others have been “handling” Ron Paul for a considerable portion of his campaign and attempting to divorce him from the elements of the movement which are seen as “extreme” or anti-establishment, even though these are the same elements that catapulted Ron Paul into the minds of average Americans.  My impression is that they have been targeted for surgical removal because they are impossible to co-opt for the purposes of diplomacy (submission) with the Neo-Con elites running the GOP carnival.

Rand Paul’s recent endorsement of Mitt Romney is not surprising given the parasitic nature of particular campaign organizers who buzz about him, including Benton.  The bottom line is that some people in the movement are not in it to fight for freedom, or to ensure a brighter and more Constitutional Republic.  Some are in the movement to further their political careers and ambitions, and are perfectly willing to use the energy of popular candidates to carry them to success.

Sadly, this is the ultimate weakness of the political ideal; regardless of how honest and forthright a candidate is, even a principled luminary like Ron Paul can be undermined by those closest to him if he is not careful.  Millions of people relying solely on the tenuous chance of victory of a single man in a single rigged contest is NEVER a recipe for liberty…..

Stewart Rhodes’ speech at Paulfest was the most shocking for many of the political Paulers, as well as the most necessary.  He removed the kid gloves completely as well as any feel-good rhetoric, stating that the GOP as a party was dead, and deserved to be, letting the Paul folks know that any further strategy of attempting to “infiltrate” the Republican establishment and turn it over to the side of good was a waste of time.  He also stated that it is no longer enough for the movement to play around as “intellectual warriors”, they might soon have to become real warriors.  I agree.

In my speech, I gave clear cut and tangible solutions to Paulfest attendees, including alternative markets and barter networks, commodity based currencies, micro industries and localized business models, useful trade skills, off-grid living, preparedness, and if all else fails, real revolution.  Not idealized intellectual activism under the catchy label of revolution, but fists in the air and rifles in hand revolution.  The kind that scares the crap out of most, not because of its danger, but because of its finality of purpose.  The will to fight, really fight, is frightening, especially to those who cling to the belief that one can reason with his opponents.  The cold hard fact is; some men are not men.  Some men are monsters, and reason is the last thing that will ever sway them…”

Summers Steps Down As Obama Economic Advisor

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Reuters is reporting that the often blunt Larry Summers will step down as Obama’s economic adviser at the end of the year, in what looks like a victory for his critics on the left. Rumors have it that Summers, criticized by many for being too close to Wall Street, was “bullying” his colleagues and shutting out people like Paul Volcker, the Rockefeller-connected banker with deep ties to the power elite, who is credited with stemming the runaway inflation of the 1980s by hiking interest rates as high as 21.5%.

This is the third economic aide to leave – the other two being Christina Romer, chair of the Council of Economic Advisers, and Peter Orzsag, budget director.

Summers will be returning to teach at Harvard, where he resigned as President in 2006, for  politically incorrect remarks about female abilities in math that many faculty members saw as discriminatory.

Daily Bell: Elites Conspire Over Afghan Mineral Wealth

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The Daily Bell on the Afghan mineral discovery:

Here is what the Anglo-American brain-trust may have in mind:

1. It will invite countries into the region to “exploit” minerals, operating through the Afghan government. (And has already invited China.) Each country, once involved, will be expected to provide its own security. Continue reading →

We’re Too Broke To Be This Stupid

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Mark Steyn:

“The Spanish government pays over $800,000 for every “green job” on a solar-panel assembly line. This money is taken from real workers with real jobs at real businesses whose growth is being squashed to divert funds to endeavours that have no rationale other than their government subsidies—and which would collapse as soon as the subsidies end. Yet Tim Flannery, the Aussie climate-alarmist who chaired the Copenhagen racket, says we need to redouble our efforts. “We’re trying to act as a species,” he says, “to regulate the atmosphere.” Continue reading →

Jacob Hornberger: How Much Do Liberals “Love” the Poor?

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Jacob Hornberger (Lew Rockwell):

Did I mention that 19th-century America was not only the most prosperous nation in history but also the most charitable nation in history? In a land with no income tax and no welfare state, it was voluntary contributions that built the churches, opera houses, museums, and so much more. Continue reading →

India Changing…

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Jayant Bhandari in Liberty Unbound:

“Now, as I travel through India’s smaller towns and villages, I gather many impressions, both of change and of continuity.

I stay in rooms that cost me $2 a day, and purchase all-you-can-eat food for 50 cents. I pay my driver the princely sum of $7 a day. To Westerners, these prices will appear astonishingly low, but inflation of food prices in India is close to 20%. Food is very expensive for regular folks, and speculators are being blamed. I am constantly amazed that there is never any mention of the fact that the Indian government still runs one of the most efficient printing presses in the world — printing money, of course. The only thing that limits inflation is the high rate of real economic growth. Yet the Indian government is getting extremely addicted to increasing expenditures. The government’s fiscal deficit is about 12% of GDP. To me this is like addiction to heroin. What will happen if the growth rate falters?

In an isolated place, a woman sells me a 15-kilogram bag of fruit for a total of 60 cents — fruit worth about $15 in Bhopal. Her companions think she’s won a lottery. These wretched women chase me and beg me to buy some from them. I feel sorry for the little girl who had tears in her eyes. Yet I am repelled by the fact that so many Indians easily grovel and beg. The worst is when well-off people do this. A visit to a government office in India is essential if you want to understand the degradation that the Indian public accepts even today.

I meet the top management of a company constructing a major highway. The highway was deemed uneconomical, so the government and the company agreed that they would use eminent domain to confiscate a lot more land than was necessary from the farmers, at 5% of the market value. The extra land would be converted into condos or commercial space. The poor people would subsidize development. Why should they subsidize the development of the country? This is socialism in practice, although the farmers are branded communists when they rebel. Meanwhile people in the West believe there is something romantic about poverty — a view that is not only hypocritical but pathetically wrong..…”

Libertarian Living: Neuroeconomics and Cooperation

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“The Science and Ethics of Cooperation,” by Michael Townsey, Prout Institute:

“The cooperative system is fundamental to the organization and structure of a Prout (the Progressive Utilization Theory) economy. It is an expression of economic democracy in action – cooperative enterprises give workers the right of capital ownership, collective management and all the associated benefits, such as profit sharing.[i] Prabhat Ranjan Sarkar, the propounder of Prout, goes further and argues that an egalitarian society is actually not possible without a commitment to the cooperative system.[ii] The commitment is not just to an economic order but also to a cooperative ethic and culture. This essay explores some of the scientific evidence that humans have a predisposition to cooperation and in particular to economic cooperation. The evidence comes from a new and exciting field of research known as neuro-economics. We then turn to those insights provided by sociological studies.

Neuro-economics

Neuro-economics is the study of the neuro-physiological underpinnings of economic decision making. The field is new and providing unexpected insights into human economic behavior. Classical economic theory requires individuals to make complex calculations to maximize their personal advantage or utility. Utility, however, is a strangely ambiguous concept. On the one hand it is given a numerical value which implies the counting of something but on the other it is entirely abstract and not anchored to anything in the real world that can be counted. The advent of neurophysiology led to the idea that utility was really a surrogate for some chemical currency inside the brain, with most interest focused on serotonin molecules because these are known to be responsible for the experience of pleasure.

It turns out that a wide range of molecules of emotion[iii] impinge on the mental cost-benefit calculations that are supposed to take place inside the brain and they have unexpected effects. For example, in a ‘sharing experiment’, person A was asked to share a sum of money with person B. These experiments demonstrated behavior inconsistent with neoclassical theory. People appear to put a high value on fairness. In a follow up experiment, persons A and B were placed in the same experimental scenario as before, but they were (unknowingly) given an intranasal administration of oxytocin. Oxytocin is a neuropeptide that plays a key role in social attachment and affiliation in animals and causes a substantial increase in trust in humans. In these experiments the effect of oxytocin was to increase the amount of money that A gives B. The experimenters concluded that “oxytocin may be part of the human physiology that motivates cooperation.”[iv] It is worth adding that such hormone-mediated interactions are not confined to human relationships but are also likely to be involved in human-animal relationships.[v]

Oxytocin is not the only neuro-chemical to promote cooperation. Recent observations of bonobo monkeys in the jungles of the Congo reveal fascinating contrasts with chimpanzees.[vi] Bonobos are matriarchal and show little aggression compared to the patriarchal chimps. Chimps respond to strangers with aggression, while bonobos demonstrate curiosity. When under stress, chimp tribes degenerate into fighting while bonobos respond to stress by engaging in collective sexual activity. Scientists have concluded that bonobos demonstrate higher levels of trust both with each other and with strangers. Of most interest, however, from a neuro-economics point of view, is the ability of the monkeys to perform a simple task requiring cooperation in retrieving some bananas that are out of reach. Although both species are intelligent enough to work out a solution (for example, by one climbing on the shoulders of the other or by one holding a ladder for the other), the chimps fail because they cannot trust one another. On the other hand, bonobos have no trouble cooperating to retrieve the bananas.[vii]”

Sarkozy Advocates “Bruni Index” to Measure Economic Progress

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Well, he didn’t call it exactly that…but Sarko has joined former World Bank economist-turned-critic-of-globalization Joseph Stiglitz to co-author a report demanding that governments measure economic progress in broader terms than GDP, including such things as health care availability, leisure.

Developmental economist Amartya Sen has been at the forefront of that approach.

“French President Nicolas Sarkozy asked world leaders to join a “revolution” in the measurement of economic progress by dropping their obsession with gross domestic product to account for factors such as health-care availability and leisure time….”

More here

My Comment:

While applauding the sentiment, this must win some kind of medal for fuzzy thinking. The point of a measure of economic productivity is that it measures, well, economic productivity.

Now, the productivity (or the production ) of morality, pleasure, good health or anything else, isn’t outside the realm of economic activity or of government statisticians, but if you think economic activity is hard to quantify, as we’re increasingly realizing, how much more difficult would it be to quantify such subjective factors?


The problem is only trained economists would ever have been silly enough to confuse the GDP of a country with its economic progress, or with its state of civilization, in the first place. No one else does. Then having made this elementary error, the experts now want to compound it by confusing production with consumption, economics with sociology and medicine, and work with leisure. It was the dismal science. Now it’s the dumbbell science. Or, as I suspect, this is the start of another propaganda effort of some kind..

Hayek on the Inadequacy of Mathematical Economics

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“There is something fundamentally wrong with an approach which habitually disregards an essential part of the phenomena with which we have to deal: the unavoidable imperfection of man’s knowledge and the consequent need for a process by which knowledge is constantly communicated and acquired. Any approach, such as that of much of mathematical economics with its simultaneous equations, which in effect starts from the assumption that people’s knowledge corresponds with the objective facts of the situation, systematically leaves out what is our main task to explain. I am far from denying that in our system equilibrium analysis has a useful function to perform. But when it comes to the point where it misleads some of our leading thinkers into believing that the situation which it describes has direct relevance to the solution of practical problems, it is high time that we remember that it [equilibrium analysis] does not deal with the social process at all and that it is no more than a useful preliminary to the study of the main problem.”

— Friedrich Hayek, “The Use of Knowledge in Society,” VII, 31