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July 28, 2015


BD Sixsmith

"It is those who think that (actually-existing) capitalism is easily reformable so that inefficiencies and injustices can be eliminated who seem to me to be the dreamers."

They are, yes, but it is worth adding than *anyone* who thinks inefficiencies and injustices can be "eliminated" is a dreamer.

Steven Clarke

You're possibly right, but this probably misjudges how people judge policy.

For one thing, even the most highly trained social scientist couldn't predict the outcomes from many policies - least of all the average voter.

And more importantly, the status quo bias means people will put a lot of weight on how far a policy is from the current ones, rather than on their intrinsic merits.

Matt Moore

"Maybe he believes that low investment is an ineradicable feature of capitalism." - low compared to what? Investment has a cost - as you say, in an uncertain world, it makes sense to invest less.

"It is those who think that (actually-existing) capitalism is easily reformable so that inefficiencies and injustices can be eliminated who seem to me to be the dreamers." - You are all dreamers. This is pretty much as good as it gets.

"if we are in secular stagnation"; we aren't, unless you think gene therapy, self-driving cars, nano-robotic, perfect voice recognition, virtual reality, commercial space travel, curing cancer and degenerative disease are all either impossible or just toys. They may come at low prices (creating massive consumer surplus) and add very little to GDP. But that means that GDP is broken more than anything else

Ralph Musgrave

Yes: you leftists are indeed “utopian dreamers”. A nice bit of evidence for that is that the above article, like a hundred similar articles by lefties, concentrates on criticising free markets and capitalism, while totally failing to tell us how an alternative system would ACTUALLY WORK.

Lefties’ lack of interest in reality is staggering. For example they’ve recently taken to bashing the EZ and EU. Unfortunately half the relevant of articles fail to distinguish properly between the effects of the EZ (i.e. the Euro) and EU.

As for lefties' ideas on the debt and deficit, the best they can do is ape the economic illiteracy of the political right, as has been pointed out time again by the Australian economics prof, Bill Mitchell.

Neil Wilson

"the Bank of England didn't begin QE until 12 months into the recession."

Hence the problem with having people in the loop and relying on New Keynesian equilibrium nonsense.

You need very strong automatic stabiliser responses in the fiscal arena.


I too am pessimistic about social reformers coming up with a credible alternative. I think we have to think how our mainly capitalist system will evolve. I suspect we are choking on bureaucracy, but hard to see which bit to dump. The human seems always to prefer individual advantage, a tendency that needs bureaucracy to control - or pre-frontal lobotomy on a large scale. Or we don't control it at all and end up with the cunning and sharp-elbowed owning everything ably assisted by the clever. We have been there before and the result is messy and not entirely satisfactory.



I think Chris has quite clear suggestions for improving things. Citzen's Basic Income, increased bargaining power, worker ownership and Jobs Guarantee, for example.


"However, just because something has occurred in the past doesn't mean it will continue to occur. Maybe reformers have picked the low-hanging fruits."

Or maybe the labour supply has been suddenly increased (2005?), with the expected impact upon wage rates and the power balance between employers and workers?

"The main purpose of the bourgeois in relation to the worker is, of course, to have the commodity labour as cheaply as possible, which is only possible when the supply of this commodity is as large as possible in relation to the demand for it"


@donald - "increased bargaining power" - where exactly is this increased bargaining power going to come from?


The lunatics have taken over the asylum where this passes as serious public policy advice.

"“Any fiscal adjustment hoping to be successful cannot avoid dealing with cuts in the welfare state and in government wages and employment”. This statement by economists Alberto Alesina and Roberto Perotti (see p.227 here) is just one example of the advice commonly given to policy-makers that budget consolidations are only successful (i.e. lead to economic growth) if welfare benefits are slashed."

"Economists argue that the main reason why welfare cuts are crucial to successful adjustments has to do with credibility. Governments that attack the electorally most delicate parts of the budget – namely welfare entitlements which are popular with the majority of voters – show that they are really serious about balancing the budget."

"Secondly, citizens and entrepreneurs acknowledge the determination of the government to reduce deficits. They are more confident about the future, consume and invest more which, again, leads to economic growth."


What fantasists are these 'Economists' who pull causes and effects from thin air?

NEF on framing for idiots - sorry politicians.

http://t.co/6DjyWOy1dI (Via Twitter)


On Minimum Wage and home care: since the services sector is making net profits of 18.9%, according to the ONS, and this is the highest figure ever, my guess is that it can afford to shift some profits from shareholders to employees' wages.

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