Some brief thoughts on Local body elections

The local body elections have been and gone in a tsunami of apathy and a followup wave of opinionista analysis.

The Opinionista analysis of the apathy tsunami usually argues that:
a) the postal voting system was to blame as people no longer believe in the traditional mail system and have no intimate relationship with post boxes except on their PCs.
b) the information presented on each candidate in thevaccompanying booklet was confusing and voters were therefore unable to select the appropriate candidate to vote for.
c) there were no issues that grabbed the voters and therefore they weren't interested in voting.
d) there were too many people trying to inject politics into local body politics or
d) there were not enough politics injected into the local body politics
e) the campaigns were boring....

The answers, such as they are opined, appear to be:
a) let's have electronic voting
b) let's return to the traditional ballot box
c)  let's have more politics in local politics
d) let's have less confusing material in the candidate booklet...

However the media opinionistas are forgetting what, to me is the most obvious, the incoherence of the local body election campaigns. The candidates do not, in most cases, run campaigns apart from erecting billboards around their area promising nothing except a smugly smiling face and a name usually endorsed with  meaningless statements like: "proudly independent" or "practical not political" or "Vision & Views". (this latter group could have the local beautifying group for all the emptiness their name implied.)

There are no meetings, no policy statements, no door knockings, no pamphlets in letterboxes and in many cases no interaction with the community the candidates profess to want to represent. Add to this mix the emptiness of the bland candidate statements in the voters booklet and you have all the elements that contribute to the apathy tsunami.

In the Auckland area were I vote the candidate profiles were so similar they may as well have been written on the same blandness template with statements like: "keeping rates down", "let's plant trees," "I love living here,"or "keep the community safe" so one could not distinguish between the possible progressive from the possible regressive.

Then, one of the candidate groups (managed by the local National MP)  flatly refused to attend any meeting that may be proposed by any community group if any candidates from any other group were to attend which, again, leaves the voter to consider a ballot paper of bland, empty, smug and policy bereft names.

No wonder apathy was the winner in the voter turn out.

If we want voters to vote then let's have organised coherent and thought out policy platforms, opportunities for fully informed communities with public meetings that are fully representative of the candidates or tickets and let's have politics injected into local body politics.

Frankly, I'm tired of the argument that local body politics should be a politics free zone to be left to the Citizens & Ratepayers (now defunct) or the Residents & Ratepayers or Progressive Independents - all the National Party in drag but, of course, politics free(!!! ) while immediately hypocritically condemning any obvious Labour or Greens ticket as injecting politics into the local body (perhaps because that would mean there would be a coherent policy platform and direction for the local body or Ward? Auckland has, until Len Brown, suffered from having a local body dominated by a drifting C&R dominated council who refused to contemplate a future further out than the next election - hence no unitary plan, a disfunctional transport system and poor planning.)

Two more reasons not to vote National-ACT - make it three

These photographs may be from the UK but, because both Cameron and Key are Crosby-Textor clients, they're singing from the same vicious hymn book of neo-liberal austerity and asset stripping.

Here's the third- a non-listening, non-comprehending Minister of Education whose policies are inimical to a quality education system.

A trenchant view of American politics- the real GOP agenda from Social Europe Journal

The Republicans’ Real Goal: To Make Us All So Cynical About Government, We Give Up

09/10/2013 by Robert Reich Leave a Comment

Robert Reich

An old friend who has been active in politics for more than thirty years tells me he’s giving up. “I can’t stomach what’s going on in Washington anymore,” he says. “The hell with all of them. I have better things to do with my life.”
My friend is falling exactly into the trap that the extreme right wants all of us to fall into — such disgust and cynicism that we all give up on politics. Then they’re free to take over everything.
Republicans blame the shutdown of Washington and possible default on the nation’s debt on the President’s “unwillingness to negotiate” over the Affordable Care Act. But that law has already been negotiated. It passed both houses of Congress and was signed into law by the President. It withstood a Supreme Court challenge.
The Act is hardly perfect, but neither was Social Security or Medicare when first enacted. The Constitution allows Congress to amend or delay laws that don’t work as well as they were intended, or even to repeal them. But to do any of this requires new legislation – including a majority of both houses of Congress and a president’s signature (or else a vote to override a president’s veto).
Our system does not allow one party to delay, amend, or repeal a law of the land by shutting down the rest of the government until its demands are met. If that were the way our democracy worked, no law would ever be safe or settled. A disciplined majority in one house could always use the threat of a shutdown or default to gut any law it didn’t like.
So the President cannot re-negotiate the Affordable Care Act. And I don’t believe Tea Bag Republicans expect him to.
Their real goal is far more insidious. They want to sow even greater cynicism about the capacity of government to do much of anything. The shutdown and possible default are only the most recent and most dramatic instances of terminal gridlock, designed to get people like my friend to give up.
And on this score, they’re winning. Congress’s approval rating was already at an all-time low before the shutdown, according to a poll released just hours before Washington went dark. The CNN/ORC poll showed that only 10 percent of Americans approved the job Congress was doing, while 87 percent disapproved. It was the all-time lowest approval rating for Congress on a CNN poll.
A recent Gallup survey found that only 42 percent of Americans — also a record low  — have an even “fair” amount of confidence in the government’s capacity to deal with domestic matters.
And in a recent survey by the Pew Research Center, 26% of Americans say they’re angry at the federal government while 51% feel frustrated. Just 17% say they are basically content with the government. The share expressing anger has risen seven points since January, and now equals the record high reached in August 2011, just after the widely-criticized debt-ceiling agreement between the President and Congress.
It’s a vicious cycle. As average Americans give up on government, they pay less attention to what government does or fails to do — thereby making it easier for the moneyed interests to get whatever they want: tax cuts for themselves and their businesses; regulatory changes that help them but harm employees, consumers, and small investors; special subsidies and other forms of corporate welfare. And these skewed benefits only serve to confirm the public’s cynicism.
The same cynicism also makes it easier to convince the public that even when the government does act for the benefit of the vast majority, it’s not really doing so. So a law like the Affordable Care Act, which, for all its shortcomings, is still a step in the right direction relative to the costly mess of the nation’s healthcare system, is transformed into a nightmarish “government takeover.”
So here’s what I told my friend who said he’s giving up on politics: Don’t. If you give in to bullies, their bullying only escalates. If you give in to cynicism about our democracy, our democracy steadily erodes.
If you believe the fix is in and the game is rigged, and that a handful of billionaires and their Tea Party puppets are destroying our government, do something about it. Rather than give up, get more involved. Become more active. Make a ruckus. It’s our government, and the most important thing you can do for yourself, your family, your community, and the future, is to make it work for all of us.

We ignore Keynesian economics at our peril- Social Europe Journal analysis

Overlooking Thirty Years Of Economic History And Downplaying Keynesian Economics

04/10/2013 by Andrew Watt Leave a Comment

Andrew Watt

Brad Delong is an extremely smart, trenchant and witty economist. He has just published a piece comparing the Great Depression of the 1930s with the ongoing Great Recession of today and drawing lessons from the experiences of both episodes. It is typically erudite and deals with complex issues in a clear and concise way. However, being trenchant and concise has its dangers, not least of which is missing things out. This can happen, and the costs will often be small relative the benefits of maintaining focus on the key issues (and not boring readers). What is surprising and worrying in this case is that Brad Delong – a renowned economic historian and one very open to Keynesian views – has missed out the thirty important years of economic history and very much downplays Keynesian economics in that period and also since.
In a nutshell – you really should read the whole article – Delong argues the following:

• The Great Depression happened because policy makers didn’t understand the problem and thus failed to do what was necessary (or made things worse): they lent freely to banks in bad shape, but the insisted on sound finance and balanced budgets.
• Milton Friedmann and Anna Schwarz said in the 1960s that the problem had been that the Fed focused on the interest rate (the price of money), rather than the quantity of money. The Great Depression would have been avoided had the Fed prevented the money supply contracting.
• Economists in general and Ben Bernanke in particular accepted this view and so the Fed kept up the money supply when the Great Recession hit.
• This was partially successful (performance was better than the Great Depression), but not nearly enough. This reason is that pumping money into the system doesn’t help if people do not crave liquidity so much as safety (lower debt and fewer risky assets).
• What actually got countries out of the Great Depression was some combination of devaluation (getting off the Gold Standard), creating expectations of higher inflation and deficit spending.

There is nothing actually wrong with this line of reasoning, but:
a) what about the “trentes glorieuses” from 1945-1975?
Brad Delong starts the post-war story with Friedman/Schwarz in the 1960s, whose doctrines were not accepted until the late 1970s, and then radicalised by the likes of Lucas to the extent that the problem of cyclical demand management was believed to have been solved: all you have to do is ensure steady growth of the money supply. But he overlooks the preceding period which was characterised by steady and strong growth and a lack of (financial) crises in the advanced capitalist countries. It was also characterised by strict regulation of the financial sector, an expansion of the welfare state (and thus also of automatic fiscal stabilisers) and a belief in the use of both monetary and fiscal policy for counter-cyclical purposes. Which brings me to:
b) what about Keynesian economics?
Brad only mentions Keynes in the context of the debate about the Great Depression, not subsequently. But the predominance of Keynesian theories at least coincided temporally with (and I would argue was a causal factor behind) thirty years of crisis-free growth. Post-war Keynesianism was replaced by the doctrines of, yes, Milton Friedman and Robert Lucas. While Friedman, at least, believed in the counter cyclical use of monetary policy, increasingly his followers, and notably Lucas, focused on market-promoting supply side reforms as the Holy Grail of economic policy. Three important components and consequences of this approach were: Reduction in the size of (and the increased marketisation of) welfare-spending and government “meddling” in the economy, which reduced the size of the automatic stabilisers. Financial market liberalisation: supposedly efficiency-enhancing, this made the economic system far more fragile for reasons that had been long understood – not just by Minsky and Koo, whom Brad approvingly cites – but also people like Kalecki and Keynes himself. And exchange-rate and capital account liberalisation which presaged a series of boom-bust episodes in emerging markets.

 (Inserted comment: The neo-liberal asset stripping policies being practiced in New Zealand by the National-ACT govt lead by money speculator John Key are based on the same faulty Friedmanite economic logic which has been demonstrated by BERL as damaging for the economy as a whole and grossly economocally irresponsible.)

Missing all this out, it seems to me, is taking concision and parsimony rather too far. It is certainly true that much of the economic profession bought into monetarist and market-radical ideas. But the fact is that these had driven out theories and policy convictions that continued to be held by a minority of Keynesians and that were – perhaps not in all respects, but in many – much superior. It is not that the Friedmanite counter-revolution and what followed did not contain any useful ideas (expectations; problems of using fiscal policy effectively). But much that was useful was buried.
In short, we didn’t actually need to go through the Great Recession to see that Friedman and Schwarz were wrong.

Coincidentally, today I saw a nice example of the fact that – let us be generous – scientific progress is not linear. Economists at the European Commission – a champion of pre-crisis financial liberalisation in Europe – are now experimenting with enriching their DSGE model with the path-breaking idea that investors cannot simply borrow without limit at the prevailing rate of interest but normally require collateral. The availability of credit depends on the (expected market) value of that collateral. This creates the potential for self-reinforcing booms and subsequent slumps. This path-breaking idea was set out (at the latest) by Michal Kalecki in 1937. Needless to say he is not included in the list of references.

Teachers deserve respect- International study reports

In face of the constant criticism of the Teaching profession in New Zealand by such luminaries as the MSM, Magazine opinionistas  and politicians both failed and in power like Rodney Hide, John Banks and Hekia Parata the findings of international research on Teaching and teachers makes for informative reading. The report argues that the constant criticism of the teaching profession in New Zealand by those whose political agenda is questionable and based on ideologically unsound prejudice is unjustified.
What is of concern is the reported perception that Teachers are regarded as social workers by the New Zealand respondents rather than their abilities to teach and educate our children.
The report deserves more in depth reading by both opinionistas and those who currently are driving the education agenda and policies in New Zealand.

AUSTERITY ECONOMICS AND BEING ECONOMICAL WITH THE TRUTH

Austerity, Growth And Being Economical With The Truth

This article from From SOCIAL EUROPE JOURNAL.deserves reading especially when we consider the economic policies being followed by the neo-liberal asset stripping government of John, PinoKeyo, Key here in New Zealand.

 

 01/10/2013 by Simon Wren-Lewis 

Simon Wren-Lewis

OK, I know that those more seasoned in trying to present simple economic ideas in a politicised environment know this happens all the time. And damn it I knew it was going to happen too, as I clearly predicted in one of my early posts. But still, despite my attempts to mock, the argument that positive growth proves critics of austerity wrong continues to annoy me. So here is my attempt to say why it bothers me so much, but after this post I really will try to move on.
Just in case you have not been convinced by my earlier posts of just how ludicrous this argument is, think about this. US growth became significantly positive at the end of 2009, and has remained so in nearly every quarter since then. So if positive growth proves critics of austerity are wrong, then the austerity debate in the US would be well and truly dead by now.  Those that refused to admit this would be completely ignored. Yet the opposite is true.
So the amazing thing is how the idea that the emergence of growth after years of stagnation proves austerity was just fine could gain a moments traction. Do not get me wrong. There are some arguments in favour of austerity that should be seriously debated. But this is not one of them. Instead the argument is just silly. So how can people get away with making it?
The first point to make is that although the argument is obviously silly to anyone with a modicum of macroeconomic knowledge, to interested people without that knowledge, but who get to listen to (or even interview) people like George Osborne, it is not immediately obvious. It becomes pretty obvious once it is explained (my example of deliberately shutting down part of the economy was designed with that in mind), but you need to be exposed to someone who can explain that. So, for those just interested in scoring political points, there is a temptation to make the argument if they think they can get away with it.
However I do not think that excuses George Osborne, or European politicians who have done the same for the Eurozone. We may pretend to believe that all politicians lie through their teeth all the time, but actually we do expect people like the UK or German finance ministers to avoid talking economic nonsense. At the very least we expect their civil servants to stop them saying things that are nonsense. Well not this time.
But there are limits to what politicians can get away with.  The interesting question is what those limits are, and what governs those limits.
Sometimes politicians can get away with bad arguments because they are based on half truths. The example that comes to mind is the idea that current austerity is required because of fiscal profligacy on the part of the past Labour government. While that myth annoys me because (a) it is used to support a damaging policy, and (b) because having crunched the numbers I know it’s untrue, the existence of the myth does not surprise me in the same way. As I have said before, the half truth here is that Gordon Brown was a little imprudent by being overoptimistic about tax receipts. Furthermore, if he had known in advance that the global financial sector was going to blow up he would have been much more cautious before that happened, so any data that is by construction wise after the event will suggest he was not cautious enough. This all means that for those who want to mislead there is the seed corn with which to grow this myth.
Nothing like this is true for the ‘growth proves austerity right’ idea. Instead it is an example of completely misrepresenting the argument of your opponent. The overwhelming majority (maybe all) of the economists who criticised austerity said that fiscal contraction would reduce the level of output in the short run. They may also have been concerned that this short run deflation might have negative longer term consequences. The deception is to morph that into ‘critics of austerity said that the economy would never grow again as long as austerity lasted’. Now I’m sure you could find some person (call them X) who was foolish enough to say the economy would never grow while austerity lasted. But everyone knows that Paul Krugman, or Brad DeLong, or Jonathan Portes are not X. Yet those making the ‘growth proves austerity right’ argument deliberately talk as if all critics of austerity were like X. It is a deliberate deception. It must be particularly galling for Martin Wolf to find his own newspaper doing this to him.
Economists whose job involves communicating with others, and media organisations that purport to have some economic expertise, have I believe the equivalent of a duty of care. It is their job to make sure people are not misled by arguments that they know are obviously wrong. What makes me cross is seeing some who choose not to exercise this duty of care.
Let me use an analogy. You are a science reporter for a newspaper, or even a reporter working for a magazine like the New Scientist or Scientific American. You have to comment on a politician who claims that because it snowed a lot this winter, climate change is clearly rubbish. What you would do in those circumstances is patiently explain why the politician was talking nonsense, discussing trends and noise and the like. You would not say as a prelude that the politician ‘makes a serious case’. You would certainly not write a leader in your paper saying the politician was absolutely right!
Just imagine it. A leader in the New Scientist or Scientific American saying that politicians have won the climate change argument because of recent heavy snow. So why is that idea inconceivable, but a leader in the Financial Times saying that recent UK growth proves critics of austerity are wrong goes without comment? It has nothing to do with economists being divided about the wisdom of austerity: as I said, there are arguments on austerity that should be debated, but this is not one of them. It cannot be because austerity is so politicised, because climate change is also highly politicised. It cannot be excused by saying that leaders are just opinions: you do not expect opinions in serious newspapers to be based on deliberate misrepresentation. So what is going on here? Would anyone from the FT care to comment?
This post was first published on Mainly Macro

What happens when private interests get in the way of efficiency?

These two pictures say it all.

1) PinoKeyo on why he favours private schools over State schools while pushing through legislation to ensure the profit taking group can get even greater leverage in the dismantling of the State system.

 2) What happened to the Government developed kitset home project in the 1920s once private interests realised that the State could do it better.

 And now, when faced with a housing crisis, the only solution the PinoKeyo govt can come up with is to sell off Housing New Zealand stock and decry the Labour Party policy of building 10,000 houses a year for the next 10 years as being impractical.