No. of Recommendations: 4
Populism


MIT economist explains that the Global has led to rising GDP per capita but also income inequality.
https://www.youtube.com/watch?v=4otroKOb3b8

And that income inequality is not restricted to the working class but is also bleeding into higher income professional class workers.
https://www.bloomberg.com/news/articles/2019-04-13/america-s...
As of the end of 2018, net worth as a share of the U.S. total had shrunk considerably for the upper middle class. In one generation, U.S. wealth held by households from 50th to the 90th percentiles fell from 35.2 percent of the total to 29.1 percent. Most of this wealth has transferred to the top 1 percent of U.S. households.

And the recent 2007/2008 financial crisis accelerated that process. And another financial crisis will likely occur as the investment bankers know they are a protected class that will be bailed out again.

US international corporations benefit most from US trade agreements. Those corporations increase their profit by utilizing cheap foreign labor and can hide their profits offshore. US consumers benefit lower cost electronics, clothing, & appliances. The working class has been devastated economically & bipartisanly ignored for decades. A rage has built up. And that rage will spread to higher income group as they enter the "left behind" like the working class.

Personally I do not believe anymore that the system can reform itself due to special interest groups infecting US congressional representatives.

I try to protect myself by increasing my stock weighting with health care & IT sectors [Vanguard VHT & VGT]. I think it doubtful congress with move against Health insurers/Pharma or Silicon Valley significantly; it would be against those representatives economic interest. The "invisible hand" isn't always beneficial to citizens.

Populism isn't limited to the US as the Brexit vote, Yellow Vest protest, Ukraine election & perhaps the upcoming election in Spain & rising number of populist representatives in the EU* shows.

*https://www.brookings.edu/blog/order-from-chaos/2018/03/08/t...
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https://newrepublic.com/article/153507/france-yellow-vests-u...

Christophe Guilluy, the geographer whose books La France périphérique and Fractures françaises first drew wide attention to the problem of desertification, believes there is something more general at work than a revolution in retail. Over lunch in Paris in early winter, he described his visits to Scandinavia (where the anti-immigration Sweden Democrats took 18 percent of the vote in last September’s elections) and Quebec (where the anti-immigration Coalition for Quebec’s Future toppled the province’s older liberal and separatist parties). When it comes to the economic and political effect of globalization on rural areas, Guilluy says, “Western societies are living under the same dynamic. The sociology, whether Italian, American, or Swedish, is exactly the same.”?

Emmanuel Macron. A product of France’s elite École Nationale d’Administration, he worked as an investment banker, earning about $1.5 million a year until shortly before becoming minister of the economy under his Socialist predecessor, François Hollande, in 2014. He was 36 then. Macron put together a law that bore his name, aimed at “unlocking” the entrepreneurial dynamism of the French economy—in part by permitting shopping on Sundays, in part by cutting regulation, in part by making it easier to lay people off.

Macron bet that taking the side of the economy’s winners was something Socialist voters were ready to do.

Macron bolted the government soon thereafter, and in 2016 launched a movement and a presidential candidacy.
The real heart of the Socialist Party turned out to be its progressive urban rich—

Before 2017 was over, Macron abolished the impôt sur la fortune, a wealth tax of around 1 percent paid by the 340,000 richest French families. Rarely will you talk to a gilet jaune for more than 15 minutes who does not mention it.


Macron's rise & his agenda were brought to shrieking halt with the diesel tax increase. The final straw was Macron explanation that it was a conflict between those who cared about saving the planet and those who worried about making it to payday. In other words, the working class was just selfish.
The Yellow Vests arose. Efforts to link the protest to Russian interference failed. Labeling them as a mob has failed. The French population:still a solid majority (54 percent to 30) in sympathy with them.

A lot of French people believe Macron is indifferent to the problems of those who have not found their footing in the feverishly globalizing cyber-economy. Macron has the habit, bizarre for a democratic politician, of talking about (and to) the non-rich as if they were losers. At the launch of a center for internet startups, he contrasted people who had succeeded at business with other people—“people who are nothing.” He did this so often that it began to seem possible that his haughtiness was not a mistake but a conviction.??


Hm Macron has much in common with an American politician comment about a “basket of deplorables”.

The global economy has divided nations into insiders & outsiders. The outsiders economically devastated & insulted by the insiders while those insiders benefit from the global economy.
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Hm Macron has much in common with an American politician comment about a “basket of deplorables”.

Yup, and the other candidate who complained about half of the population not paying any income tax, without considering that they don't pay any income tax because they have so little income.

Steve
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No. of Recommendations: 4
James Galbraith with lively critical review of three macro-economics books on breakdown of neo-liberal economics optimism and relationship to modern democratic/authoritarian institutions:

https://www.project-syndicate.org/onpoint/capitalism-s-great...

(free registration might be required to read)(bolding by flyerboys)

Opening of his review:

What fate awaits capitalism, and to what extent do our current economic conditions reflect its shortcomings? With deferential references to Adam Smith, and firmly anchored in the high critical tradition of political economy, all three books under review seek to answer these questions. Their authors are all capitalists, resigned if not enthusiastic; they share a conviction that there is no viable alternative system. Thus, whatever its flaws, capitalism must be reformed.

In People, Power, and Profits, Nobel laureate economist Joseph E. Stiglitz, the great chronicler of globalization and its discontents, offers a lucid assault on the economics and policies of the Trump era.

In The Future of Capitalism, Paul Collier, an Oxford University economist best known for his critiques of the prevailing approach to development aid, assumes the mantle of the moral philosopher, like Smith in The Theory of Moral Sentiments. He argues that capitalism is “morally bankrupt,” but that it can be redeemed, if only by – somehow – building a new ethical foundation.

[With Capitalism Alone:
The Future of the System That Rules the World
,] Branko Milanovic, an intrepid economic statistician at the City University of New York Graduate Center, best known for his work on global inequality, provides a contemporary taxonomy of capitalism, dividing it broadly into the “liberal meritocratic” version found in the West and the “political authoritarian” dispensation that has emerged in China and elsewhere in Asia.


Galbraith points out that all three books return to Adam Smith's point that political economy is fundamentally an ethical moral subject, and much that is wrong with macroeconomics today has roots in moral ethical decadence.

Links to books:
https://books.wwnorton.com/books/People-Power-and-Profits/
https://www.harpercollins.com/9780062748669/the-future-of-ca...
http://www.hup.harvard.edu/catalog.php?isbn=9780674987593

david fb
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I remember some years ago, when the "killer bees!" panic was just starting, a lot of allegedly-credentialed naturalists were predicting they would spread all over the country.

An economist set out the problem of maintaining a hive as an economic issue, from the bees' perspective, weighing the energy flows. He described what sort of territory was required for "killer bees" to be an ongoing problem, and why. He excluded most of the United States, even much of the area where the bees were a problem at that time. (Being an intelligent fellow, he didn't dismiss the possibility of short-term flukes and oddities.)

He treated a beehive as a capitalist enterprise.

And his conclusions about the bees are proven correct.

Yeah, I think that we're going to have capitalism for a long time. Attempts to destroy it will just change the environment and incentives under which it operates.
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"..much that is wrong with macroeconomics today has roots in moral ethical decadence."

Well then, that's easily fixed...

;-)
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neuromancer goes Directly! to the actual point of my post (besides urging some others to help me read and discuss which books?):

[fb] "..much that is wrong with macroeconomics today has roots in moral ethical decadence."

[neuromancer] "Well then, that's easily fixed..."


;-)

And warrl hits the other point, one where we have shared narrow but strong agreement for more than 12 years,

Capitalism is more an underlying reality of REALITY than it is a political/moral/power philosophy.

The political/moral question responding to that reality is (neuromancer right on it):

What is to be done?

(:-)

All three books look interesting on that score.

david fb
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Capitalism is more an underlying reality of REALITY than it is a political/moral/power philosophy.

https://www.zmescience.com/

How scientists taught monkeys the concept of money. Not long after, the first prostitute monkey appeared

Cheers
Qazulight
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Galbraith points out that all three books return to Adam Smith's point that political economy is fundamentally an ethical moral subject, and much that is wrong with macroeconomics today has roots in moral ethical decadence.

The power players that presently dominate the eastern and western hemispheres are essentially decadent and ethically untethered. Western capitalism is now Crony Capitalism and eastern socialism is now Crony Socialism. Both are empowered by the central bankers - whose loose monetary policies enable politicians and strongmen to buy votes, influence, and massive amounts of weaponry - completely free of economic reckoning.

Without fiscal discipline, the present global economic system is self-reinforcing, rather than self-correcting. Central bankers are willing to do "whatever it takes" (i.e. - print and purchase assets) to cover for, protect, and reward the irresponsible fiscal behavior of their politicians, corporate titans, and dictators.

This kind of wealth inequality and shamefully displayed decadence in the past have led to one of two things:

Revolution or economic collapse.

It's entirely possible that the world will see both in this century.
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No. of Recommendations: 2
Qaz citing a study:

scientists taught monkeys the concept of money. Not long after, the first prostitute monkey appeared

I found the actual scientific paper in pdf form! Glory Hallelujah, God's Plan made evident in the actions of "lower species"!!!.

Gosh, I always suspected I had made the wrong career choice.

Here is the paper:

http://citeseerx.ist.psu.edu/viewdoc/download


david fb
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notehound:

wealth inequality and shamefully displayed decadence in the past have led to one of two things:

Revolution or economic collapse.


Yes. Cannot get more macroeconomic than that.

It's the timing that gets sticky. Of course, between HWMNBN voters and the French yellow vests and the Brexiters and the ISIS wannabes and the flood of bewildered nouveau riche Russians looking for permanent homes in Mallorca I get bewildered.

david fb
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Oh hey, columnist and author George Will is chiming in:

https://www.washingtonpost.com/opinions/america-is-borrowing...

viewing macroeconomics from the POV of moral decadence.


david fb
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Galbraith points out that all three books return to Adam Smith's point that political economy is fundamentally an ethical moral subject, and much that is wrong with macroeconomics today has roots in moral ethical decadence.

Immoral and decadent Capitalism that works needs to be replaced by the much more moral and progressive Socialism that doesn't.

Right!

Please check the right-left leaning of the tree professors. I don't know about the other two but Stiglitz and the Nobel panel that gives out economics prizes are firmly in the left lane. Why does this matter? Because lots of authors, left and right, tout the dogma and then find facts to back up that dogma. It's no longer economics but religion.

Just to show that I'm not being prejudiced, George Gilder is a case in point on the right. Being an Altruistic Christian Capitalist he preaches that Capitalism is Altruistic, the exact opposite of the three named professors.

The "flaw" of Capitalism is that it does not produce equal outcomes even when there is equal opportunity because ability and luck are unequal. There is a wonderful piece of science fiction that solves the problem of unequal ability by handicapping able players just like they do in horse racing.

What happens when you handicap able players? They become less productive and the system as a whole becomes less productive. With his characteristic wit Winston Churchill called it the even distribution of misery.

Why is there only ONE president? ONE pope? ONE most valuable player? ONE king? ONE top leader of Red China? All these systems produce unequal results, every one should be president, pope, MVP, king, etc. It's ONLY FAIR!

Right!

The Captain
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every one should be ... pope ...

https://www.gaia.com/wp-content/uploads/wilson_pope.jpg

All Hail Discordia!
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The "flaw" of Capitalism is that it does not produce equal outcomes

The real flaw of Capitalism is the tragedy of the commons. Is there a market-based solution?
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The real flaw of Capitalism is the tragedy of the commons. Is there a market-based solution?

I'm afraid I don't follow you. The tragedy of the commons is supposed to arise from the lack of private ownership, what is not owned is not protected.

Can you substantiate your statement?

The Captain
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No. of Recommendations: 3
I'm afraid I don't follow you. The tragedy of the commons is supposed to arise from the lack of private ownership, what is not owned is not protected.

Can you substantiate your statement?


Can everything be owned? Who owns the air? How does a market economy prevent air pollution?

Who owns the biosphere? How can a market economy prevent antibiotic resistance? Individual farmers make a profit using antibiotics but the result is increased disease for everyone on the planet. Is there a market-based solution? Is this just the price we must pay for capitalism? Or is government regulation necessary?
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https://www.ips-journal.eu/regions/europe/article/show/how-t...

How the market is betraying advanced economies

Despite ever-improving conditions for millions of people around the world – documented by entities like the University of Oxford’s Our World in Data and highlighted by scholars like Steven Pinker – popular discontent is on the rise in many places. The reason is simple: whereas the first trend is being driven by low- and middle-income countries, the second is concentrated in high-income countries.

Throughout the developed world, conditions for many workers are deteriorating, with no recovery in sight. Income inequality is near historic highs, wealth inequality is even higher, and economic insecurity is widespread.

In short, the post-World War II social contract in many of today’s developed economies is breaking down. And even more uncertainty and insecurity are on the way, as new technologies such as artificial intelligence and robotics take root.

Given the depth of the transformation ahead, however, it is not just the policies themselves that must change, but the very framework on which they are based. This means abandoning the idea – which has shaped public policy for more than a generation – that the ‘market’ must be the organising principle for collective decision-making.


The "invisible hand" isn't always beneficial to citizens especially when elected representatives pick the winners & losers influenced by lobbyists cash payments...er sorry campaign contributions.
The globalization of the world economy has negatively effected millions in Western market economies. While the trade agreements & tax laws have benefited large international corporations whom park profits offshore to cut their tax bill.

“Market capitalism is not a religion. Market capitalism is a tool, like a staple gun or a toaster,” Carlson said. “Any economic system that weakens and destroys families isn’t worth having.” Does this observation make Tucker a socialist? Hardly.

Free markets can be corrosive of other values or priorities that are important to authentic conservatives: family, faith, and community. We see major corporations promoting social and cultural liberalism, social media monopolies—all privately owned—de-platforming conservatives and suppressing their ideas, big business and big government working hand in hand against religion and tradition.

“In states such as Ohio, West Virginia, and Kentucky, countless children are growing up with parents in jail, incapacitated, or underground,” writes J.D. Vance in Meyer’s publication. “Yes, they live in a country with a higher GDP than a generation ago, and they’re undoubtedly able to buy cheaper consumer goods, but to paraphrase Reagan: Are they better off than they were 20 years ago?”

https://www.theamericanconservative.com/articles/capitalist-...

And it is no longer just the working class that is affected:
"As of the end of 2018, net worth as a share of the U.S. total had shrunk considerably for the upper middle class. In one generation, U.S. wealth held by households from 50th to the 90th percentiles fell from 35.2 percent of the total to 29.1 percent. Most of this wealth has transferred to the top 1 percent of U.S. households."
https://www.bloomberg.com/news/articles/2019-04-13/america-s...
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Given the depth of the transformation ahead, however, it is not just the policies themselves that must change, but the very framework on which they are based. This means abandoning the idea – which has shaped public policy for more than a generation – that the ‘market’ must be the organising principle for collective decision-making.

The "invisible hand" isn't always beneficial to citizens especially when elected representatives pick the winners & losers influenced by lobbyists cash payments...er sorry campaign contributions.
The globalization of the world economy has negatively effected millions in


In other words, when a state-controlled "free market" doesn't work, you obviously need to abandon the concept of an ACTUALLY-free market.
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