The PIIGS still fly

[thriftyandboringinohio]

Re: The PIIGS still fly

Why would you limit that observation to the utilities?

True. Many things in this world now are both essential, and offered by only one or two companies.
My favorite example is Microsoft Office software.
It is indistinguishable from a tax, everyone needs to pay it.

Our grandfathers recognized that natural monopolies exist. They created perfectly good solutions that worked for all.

[llanlad2]

Re: The PIIGS still fly

Why would you limit that observation to the utilities?

You've got to start somewhere when confronting freemarket believers. Utilities are just an obvious example of "private taxation". And the oxymoron that is "competitive free-market".

[llanlad2]

Re: The PIIGS still fly

I didn't quote Cato; the New York Times article referred to factual research.I have nothing to do with the Koch's brothers. Plus no one supports zero taxes.

Why do you try to put labels on someone with a reasonable proposal to have tax reform, reduce excessive regulation, and support free, competitive markets. You have no argument so you bring up false radical charges.

Wild accusations like this helped elect Trump. Don't try to pin that label on me either. My favorite candidate of former Democrat Senator Jim Webb.

You didn't quote Cato!!! The article used"Cato Research" as its source. So yes you did. Cato is the think tank that creates evidence when it has already decided on the outcome. They are dishonest bullshitters and get their shit printed as fact in "newspapers" everywhere. They are the purveyors of all this "reducing taxes on the rich is stimulatory" nonsense.

Kansas on the back of Koch, free-markets,Cato, Laffer reduced business rates to zero. And lowered personal taxation rates. Disastrously. And when all the evidence is against them what is their defence? Tax cuts were not big enough! Laffer was recently asked about the mess that is Kansas, and he responded by saying Gov. Sam Brownback had the right idea in cutting taxes. "He just failed to cut taxes massively enough."

If I am misquoting you please state-what reducing "excessive regulation means" because in practice it often relates to the things I mentioned.
Please link or state the "reasonable tax reform" that you are referring to.
Please propose how you aim to bring about "competitive free-markets", when the whole point of a competitive business is to kill and limit competition. Do natural monopolies need regulating?

[GRG55]

Re: The PIIGS still fly

...Yes there is inefficiency in government organisations but when it comes to the utilities private companies are just a form of private taxation. They are a private tax transfer from consumers to owners...

Why would you limit that observation to the utilities?

[vt]

Re: The PIIGS still fly

A nation and a company starting from a small base can grow much faster than a mature, older demographic nation. The U.S. had higher growth rates early in it's industrialization. While the U.S. did not grow as fast as China is today, it did not have the
advantage of modern technology that speeds China's growth.

http://ushistory.councilforeconed.or...26_visuals.pdf

China's growth is slowing, and will slow even more as there population ages and places them at a demographic disadvantage. India will dominate growth on Asia between 2020 and 2040.

[vt]

Re: The PIIGS still fly

I didn't quote Cato; the New York Times article referred to factual research.I have nothing to do with the Koch's brothers. Plus no one supports zero taxes.

Why do you try to put labels on someone with a reasonable proposal to have tax reform, reduce excessive regulation, and support free, competitive markets. You have no argument so you bring up false radical charges.

Wild accusations like this helped elect Trump. Don't try to pin that label on me either. My favorite candidate of former Democrat Senator Jim Webb.

[dcarrigg]

Re: The PIIGS still fly

EJ said that China is mercantile capitalism. So it's definitely not socialist and all recognize it.

Somebody ought to tell the Chinese Communist Party! I have a feeling they might disagree...in fact, they still seem to be under the impression they run the world's 2nd biggest economy, not to mention the fastest growing economy for nearly 30 years straight.

Even as a true believer, since you insist that markets = good and communism = evil, you might have to re-name non-market success, otherwise it disproves your religion, and you cannot have that. So call it "merchant capitalism" or "mercantile capitalism" or "state capitalism" if you want. It doesn't matter what euphemisms let you sleep soundly with your faith in the The One True Market. You still have to admit that whatever it is China has been doing worked very well for a very long time and isn't the same thing the West is doing, which means that alternatives exist. If your mind must call them all capitalism or markets with some adjective because otherwise it breaks your faith, that's fine for now. It's still the beginning of polemics, if not rational thought. The fact is, there's a system other than the standard post-Samuelson Western one that seems to work.

And even if you insist it was the West that let Chinese success happen, ask yourself, why? Was it blind Market worship that led to the lopsided trade?

Of course, you'll have to answer, "No." And you must believe China is going to collapse any day now. For they have sinned against Market. I've heard it since the 90s with state owned enterprises., then in the 00s with the ghost towns and now in the 10s with overproduction and debt. But now the SOEs are bigger than ever, the ghost towns are filling in, and Chinese influence and investment in the world is spreading as the West retrenches. The funniest thing is, mostly the five-year plans have been accurate. They're in English too. They're among the most accurate world macro-prediction documents that exist, but almost nobody reads them. If you had simply bet on them for the last 20 or 30 years, you'd be doing pretty damned well right now. They call for a reduction in Chinese growth to 6.5% average and a reduction in productivity--in exchange for improvements in several other metrics, through 2020. And so far, things are on track.

[llanlad2]

Re: The PIIGS still fly

What a crock!

I said reasonable regulation which includes all of the above. I come from blue collar so I fully understand the need to protect workers and consumers. You create a false charge to deflect a superior viewpoint.

Excessive regulation that stifles progress and holds back workers and management is hurting our ability to compete.

There is waste in government:

http://www.nytimes.com/2012/10/11/op...ty-effort.html

I didn't say there wasn't waste. In fact I stated there was. The broad thrust was towards monopolies and how they stifle the economy. And how tax cuts don't work!
Please address the example of Kansas. The Cato institute and the Koch Brothers are the worst example of capitalism I know by the way.

Guess which state the Koch Brothers Industry is based- Yes Kansas. Guess which state is facing a disaster after enacting their zero tax policies. Yes, Kansas. http://anonhq.com/koch-brothers-econ...ediate-future/


When you support Kock thinking, and quote their main think tank, then yes, you are supporting deregulation of everything.

http://www.rollingstone.com/politics...mpire-20140924

[vt]

Re: The PIIGS still fly

What a crock!

I said reasonable regulation which includes all of the above. I come from blue collar so I fully understand the need to protect workers and consumers. You create a false charge to deflect a superior viewpoint.

Excessive regulation that stifles progress and holds back workers and management is hurting our ability to compete.

There is waste in government:

http://www.nytimes.com/2012/10/11/op...ty-effort.html

[llanlad2]

Re: The PIIGS still fly

EJ said that China is mercantile capitalism. So it's definitely not socialist and all recognize it.

Of course many are not against capitalism, but lean to more government. More taxes and government isn't the best prescription.

We need some regulation, but not excessive, and that which hurts competition. We need less taxation so people can spend money on getting the economy to grow rather than inefficient government spending with too many holes in the hose.

I was part of the anti poverty program in the early 70's as a Vista Volunteer. On poverty wages we did more for the poor per person than any government social program I've seen since. Yes some businesses spend wastefully too, but the market punishes that.

The reason for the slowdown in economic growth is partially because of the 17th year of demographic slowdown, and the previous eight years of Washington not be favorable to business.

As with Kennedy and Reagan, we will see the upcoming tax cuts spur the economy. Fortunately they will be targeted at the middle class in a big way.

Is regulation that hurts competition all that matters to you?

Do poisoned waterways matter?
Do lives saved in the construction industry due to regulations matter?
Do lives saved due to fire and electrical regulations matter?
Do lives saved due to car safety and seat belt laws matter?

Or should we unburden business and let people (employees and consumers) take their own chances?

And please don't refer to the 1970s when it comes to government inefficiency. It's 40 years ago. Yes there is inefficiency in government organisations but when it comes to the utilities private companies are just a form of private taxation. They are a private tax transfer from consumers to owners. As for "markets punishing inefficiency". How can you be punished when you are a monopoly exactly?

And as for tax cuts-well didn't Kansas try that and the markets punished them by lowering their credit rating? Or was Was a 0% tax rate not low enough to stimulate the economy? The "Laffer" curve should be renamed "laffable" after that dismal experience. Anyone who believes in it probably believes in Dorothy and the Great Oz which explains why they tried it in Kansas...

[dcarrigg]

Re: The PIIGS still fly

As with Kennedy and Reagan, we will see the upcoming tax cuts spur the economy. Fortunately they will be targeted at the middle class in a big way.

I can almost see it now...

[vt]

Re: The PIIGS still fly

EJ said that China is mercantile capitalism. So it's definitely not socialist and all recognize it.

Of course many are not against capitalism, but lean to more government. More taxes and government isn't the best prescription.

We need some regulation, but not excessive, and that which hurts competition. We need less taxation so people can spend money on getting the economy to grow rather than inefficient government spending with too many holes in the hose.

I was part of the anti poverty program in the early 70's as a Vista Volunteer. On poverty wages we did more for the poor per person than any government social program I've seen since. Yes some businesses spend wastefully too, but the market punishes that.

The reason for the slowdown in economic growth is partially because of the 17th year of demographic slowdown, and the previous eight years of Washington not be favorable to business.

As with Kennedy and Reagan, we will see the upcoming tax cuts spur the economy. Fortunately they will be targeted at the middle class in a big way.

[GRG55]

Re: The PIIGS still fly

the true believers think that "self-regulation" will take care of all the problems. that's why greenspan was "surprised" when it turned out bankers cared more about their own bonuses than the long term reputational well-being of the banks they ran. duh. i haven't noticed many, or any, "free market" advocates pointing to regulations they would support. it's the extremes that are, well, too extreme to be truly functional.

arent most professions "self-regulated"? Engineering and medicine being two of the more prominent examples? :-)

[gnk]

Re: The PIIGS still fly

dcairrigg,

China has a pliant and cheap workforce. That combined with the West's decision to allow a massive part of its Industrial base to move to China is the sole reason China has risen economically. It was not organic at all. Otherwise, China would still be in the dark ages. Actually, one only need to look at rural China, the still majority of the Chinese population, to see what Communism does. Furthermore you can't compare the corruption in China with the corruption in the West.

If the West thought it was a good idea to have fair trade, where trading partners' worker's rights and conditions were respected and similar to the West as well as environmental laws, China would still be in the dark ages.

Such an historic massive transfer of productivity conceals and mitigates the effect of a lot of corruption and mismanagement of State run Enterprises. The China story is still ongoing.

[dcarrigg]

Re: The PIIGS still fly

Socialism and communism are what has failed us for well over 100 years.

That's fantastic news. I'm very happy that I never in my life advocated for either socialism or communism given that information.

I do think it's only fair that someone ought to let China and Vietnam in on the secret that their economies are failing spectacularly, though. China's on their 13th 5-year-plan, Vietnam's on their 10th, and still both maintain near total state control over the finance, insurance, real estate, utilities, energy, transportation, mining, healthcare, education, and heavy manufacturing sectors through State Owned Enterprises (SOEs).

----Snip----

SOEs command a greater proportion of the global economy than ever before. More than 80% of the Chinese stock market is made up of SOEs. Four out of the top ten largest companies by global revenue are controlled by governments, such as Sinopec and the State Grid of China. SOEs alone account for 30% of all global FDI. Likewise, two-thirds of the Russian stock market capitaliation is owned by the state. This trend has been echoed across much of the developing world. By the end of this year, it’s estimated that sovereign wealth funds will outpace the size of private investment holdings and around 90% of the world’s oil will be state owned. For the first time, the neoliberal capitalism of the West now faces viable competition against a new form of economic order

...

Whether state capitalism has the capacity to achieve all this, or whether it will fall remains to be seen. But one thing is certain: Leviathan is no longer an inefficient, ineffective bureaucrat, but a well-informed and well-trained economic agent. State capitalism’s hopes for success are higher than they have ever been in history.

Read the rest here.


----Snip----

But as I explain in some detail in my book, “State Capitalism: How the Return of Statism is Transforming the World,” Anderson’s theories, if they apply at all, only apply to a small subset of the retail industry. In many other important industries—including telecommunications infrastructure, natural resources extraction, banking, aviation, automobile manufacturing, and shipping—globalization has not had the impact that techno-optimists like Anderson imagined. In these industries, globalization has pitted more and more large firms against each other, with only the biggest and strongest surviving. Why? Because instead of opening up niches, globalization in these industries has made economies of scale far more important to companies’ survival.

In response, many governments in developing nations have abandoned primarily market-capitalist approaches, seeking to buttress their political power by turning away from the Washington Consensus model and developing more powerful national champions in strategic sectors like telecoms and resources. In so doing, over the past two decades, they have created a new era of state capitalism. Although states have intervened in their economies for centuries, the tendency has become far larger in scope, as many of the most powerful developing nations have increasingly turned to state intervention.

In addition, state capitalism today is more sophisticated than it was in the 20th century, combining statist strategies with those of free-market, multinational companies. As a result, 21st-century state capitalism is equipped with genuine strengths that earlier approaches, whether uniquely statist or free-market capitalist, lacked, and may have a better chance of surviving in the long term than strategies pursued by Maoist China or the Soviet Union. Modern state capitalists, drawing on the tools of powerful governments and the strategies of cutting-edge multinational businesses, may be able to adapt and innovate, so as to compete with Western multinationals and expand the growth and expansion of state-capitalist companies around the globe.

...

In addition, state capitalism has expanded dramatically among some of the most important developing nations in the world over the past two decades. Several of them, including China, Brazil, Russia, Indonesia, Thailand, the United Arab Emirates, South Africa and India, are among the 30 biggest economies in the world, while others, like Singapore and Malaysia, are major, important economies within their regions. Standard Chartered Bank estimates that most of the growth in the world economy between 2014 and 2030 will come from developing nations like these. To be sure, over the course of months or even a few years, growth rates may fluctuate, or even shrink; Brazil’s economy in particular is in dire shape these days. But over decades, these countries will not only power the international economy, they will also command ever-larger power in international institutions. How they manage their development will thus be critical to the world economy’s continued expansion, as well as to the health of international institutions.

These emerging powers are also increasingly serving as models for other developing nations. Although many observers now talk of a so-called Beijing Consensus, or a Chinese model of development, China, with its decades of growth and extensive training programs for foreign officials, is not the only country that developing nations are looking to for economic and even political inspiration. Singapore, Brazil, Indonesia and other democratic state capitalists are more frequently running training programs of their own for officials from other developing countries.

...

Read the rest here.



Am I writing all this to you to defend or promote Communism or State Capitalism? No.

But the simple fact is that before free-market-mania...before The Market and The Economy became anthropomorphized gods, capitalism did better in the west.

Before supply and demand graphs entered econ101 textbooks...before anyone ever tried to jam the round peg that is the chaotic interactions of human commerce into the square hole that is rationally-decided natural equilibria under perfect information and competition...we actually had more economic growth.

And despite all the 'new information' we learned about "free markets," despite the fact that we tore tariff barriers down everywhere, slashed the estate tax by over 80%, slashed top marginal tax rates and effective tax rates on top income earners and capital gains and corporations nearly in half and allowed offshore buggery and financial deregulation with total impunity...despite all the "freeing" that the markets got since then, what have been the glorious results with spectacular growth they have promised us?




I just hope that at least some who read this can come to the now-radical, but once common-sense, conclusion that sometimes markets are the problem. That means that sometimes markets are bad for economic growth. In fact, sometimes markets are bad for capitalism.

One of the first comprehensive thing the US Supreme Court did was strip property rights away from the water. See, back during colonial times, either the crown or some governor would grant some wealthy person or other the exclusive property rights to do commerce on some river, or even grant direct ownership of some river or lake or piece of ocean or bay to an individual or concern. And these folks would set up tolls or otherwise force people to use their monopoly services to move goods through their private water. Well, the Court, in its wisdom, realized that free markets and property rights in this case were a hindrance to commerce (commerce is what we used to call "market activity" before we went insane) and economic growth. So they vacated property rights on the water like that and Americans received the freedom and right to free navigation on waterways, which meant toll-free transit and commerce, which meant much more and cheaper shipping and mobility, which improved competition and economic growth. See? There's an example where private property rights and markets are bad for economic growth.

Another ripe example is the public school system. Left to markets, illiteracy ran rampant. Public school spread out the costs so nearly all children can at least learn to read and do some basic arithmetic. Private companies still get to make the bricks and the desks and the paper and the chalkboards, pencils and chairs, erasers and maps, books and globes, swing sets and sand boxes... It's not communism. The choice isn't "free markets or communism." The choice is rational thinking vs. blind faith.

But look what we are doing now. We're privatizing all the transit lanes and parking. We're handing them to monopoly concerns. We're putting tolls and variable pricing on all of them. We're tearing down the public school system and replacing it with far-off private, for profit managers...at least in the ghettos. We're attempting to convert education more and more to fee-for-service.

We've forgotten when something can be a public good and have a net positive effect. We think competition, commodification, and privatization are the solution to everything. Because we worship Markets as God. It's not just conservatives. Look at liberal environmentalists and their carbon cap and trade schemes. They are literally taking the first steps in commodifying air and making a market for it. Mammon is delighted, I'm certain. May the old gods have mercy on their lefty souls...

And don't even get me started with healthcare. Blind market worship has led to unthinking promotion of ideas that are obviously bad for commerce, and therefore bad for economic growth and bad for capitalism. And no matter how bad things get, how expensive things get, how many better examples are baldly staring you in the face that you could follow, you just think, "Nope, the answer has to be more markets. Markets cannot be the problem. Markets cannot fail. Markets can only be failed. So sayeth the Lord.

There can be no question that the economy and capitalism itself is better off thanks to near universal literacy and the potential for talent to be noticed that public schools allow vs the alternative where half the children simply work the farm or the factory and go through life illiterate. But it doesn't show up in GDP right away, even though, I promise you, if you abolished public school tomorrow and left it all to "free markets" within 30 years we'd have a depression the likes of which you cannot even fathom.

So see?

My goal is not to promote communism or state capitalism or any other 'ism.'

My hope is that at least somebody reads this and starts to think more rationally instead of acting out of blind faith.

My goal is to get just one other person to look at a problem and think, "Maybe markets are the problem." Or "Maybe markets are bad for capitalism in this instance." Or "Maybe extending markets and private property right in this way will slow economic growth."

If it's not a religion...if you don't worship "The Market," you should be able to question it, right? The choice should not be black/white between the "good" Market and the "evil" Communism. There should be infinite choices. Not just between them, but outside of them all together. We should not close our minds.

To me, market-worshipers always say, "Markets are always the solution." Then, when markets clearly fail, as they quite obviously do in US Healthcare, Market-worshipers either say, "Well, we didn't try markets hard enough," or they say, "We just shouldn't be doing things that are 'against markets' anyways. So what if our healthcare sucks. Venezuela's whole country is falling apart. So clearly you anti-market people don't know what you're talking about."

But this line of argument is absurd. Just make a small substitution. Substitute "The Market" for "a hammer" and "healthcare" for "swimming."

To me it sounds preposterous in exactly the way a narrow-minded carpenter might say, "Hammers are always the solution." And if I told him, "If hammers are always the solution, then try swimming a mile with them in your hands," and after he failed, he'd just turn it around and insist that it would have worked if he just strapped hammers to his feet. Either that or he'd say, "Only bad people swim, and if human beings were meant to go in the water, then hammers would float. I heard there was a fisherman who fell off a boat without a hammer, and he drowned anyways. So clearly you anti-hammer people don't know what you're talking about."

This is the exact same argument with the same logical form. It's unconvincing. Totally so if you don't worship "The Market."

And, of course, if you still don't believe me that there are many cases such as transitways and education and base healthcare and free air and the other things where markets and private property rights are often the problem rather than the solution...that free markets can hurt economic growth, damage capitalism, and curtail liberty...I can give you a much more obvious historical example of markets and property rights doing just that: