Thursday, December 8, 2016

Bill Mitchell — The ‘post-truth’ era – nothing new in mainstream economics

The dictionary says Post Truth is the “fact or state of being post-truth; a time period or situation in which facts have become less important than emotional persuasion”. But I prefer to be direct – not to mince words – Post Truth is lying, plain and simple. It is making stuff up that is untrue, in denial of the facts, and, in cases where volition drives the lying, using strategic and well-thought out tools of psychological persuasion, fear, threats etc to make it look as though the statements are factual rather than lies. The interesting thing for me at the moment in this respect is that we are increasingly being told we are now in this Post Truth era. That social media has created this Post Truth era and that something should be done about it. Oxford English Dictionary announced recently that the Word of the Year 2016 is…, you got it, “post-truth” which they claim is a “concept … [which] … has been in existence for the past decade”. Its use has apparently “spiked in frequency this year” as a result of the Brexit referendum and the US election. Two things then are worth noting. First, there is nothing new about the idea of lying to influence public opinion. Indeed, as I will explain (briefly) the whole edifice of mainstream economics, including New Keynesian economics has been ‘post-truth’ since its inception. Second, the fact that it is getting attention now is because the establishment are starting to feel the pinch – their usual media power is losing traction with the democratising influences of the Internet – and their cosy worlds of influence are under threat from a rabble. And this applies to so-called progressive Left (the socialist politicians in Europe, the Labour politicians in Australia, Britain and elsewhere) who have so bought into the neo-liberal myth machine that they cannot understand why they are now losing support from their traditional sources (working class people). The ‘post-truth’ era is apparently upon us. But the reality is that there is nothing new about lying in mainstream economics. It is built upon a lie. It is just that the lying that is spreading on the Internet (‘fake news sites’) are damaging the establishment. That is why they are now complaining. They have never complained about the incessant lying from the economics profession....
Bill Mitchell – billy blog
The ‘post-truth’ era – nothing new in mainstream economics
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Art Laffer: Trump Tax Cuts Will Bring Economic 'Nirvana'

Article says same-o same-o on trickle down... blah blah blah...

One key difference is Trump's vs. Reagan's view on tariffs wrt those tax effects on the external balance result.

And this is revealing from Laffer the article says:

 Laffer, a former member of Reagan's Economic Policy Advisory Board, told the Financial Times that Trump should not worry about America's growing trade deficit,

But yet at the same time he is claiming that the govt deficit will be under control via increased tax revenues if we adjust the tax rates to some optimum rate.

You can't say that because the two balances are included in the NIA accounting identity so actually all three balances matter including the external balance.

So Laffer manifestly remains operatively ignorant of the NIA framework.  All of these economists should have to go back and take Accounting 101 and Accounting 102 and I think that would probably fix them.

This is from the Accounting 101 syllabus at Wharton and is what these people have never been trained in and thus makes them currently unqualified:

The course adopts a decision-maker perspective of accounting by emphasizing the relation between accounting data and the underlying economic events that generated them.
They don't have the cognitive ability to look at an economic event and THEN accurately create the ex post accounting records that document those economic events.  They have never been trained in doing this activity so they remain ignorant in this area.  They just can't do it.

Stock rally getting ahead of itself?

The bullish stock market/economy Trump meme is based on what? We don't know yet.

Wednesday, December 7, 2016

Zero Hedge — Washington Post Appends "Russian Propaganda Fake News" Story, Admits It May Be Fake

Wanting to avoid a law suit maybe?
Criticism culminated this week when the "Naked capitalism" blog threatened to sue the Washington Post, demanding a retraction.

Now, at least, the "national newspaper" has taken some responsibility, however the key question remains: by admitting it never vetted its primary source, whose biased and conflicted "work" smeared hundreds of websites, this one included, just how is the Washington Post any different from the "fake news" it has been deriding on a daily basis ever since its endorsed presidential candidate lost the elections?
Zero Hedge

David Glasner — A Primer on Equilibrium

Good summary of equilibrium in economics and rational expectations.

Uneasy Money
A Primer on Equilibrium
David Glasner | Economist at the Federal Trade Commission

Symposium — Advice to President Trump on U.S.-Russia Policy

The following is a multi-part symposium commissioned by theNational Interest and Carnegie Corporation of New York. Check daily (Monday-Friday) for new entries. Below you will find a brief introduction to the series by Jacob Heilbrunn, editor of the National Interest.
Surprise. No one thinks that war is a good idea. 

​Wednesday, December 7: Thomas Pickering, Julie NewtonThe National Interest
Symposium: Advice to President Trump on U.S.-Russia Policy
The National Interest and Carnegie Corporation

Assad Abu Khalil — Moderate rebels trained by U.S. Green Berets turn out to be Jihadists

"For months now, SOFREP has been writing a series of articles about how badly things are going for the Special Forces soldiers assigned to covert and clandestine programs in Syria, Turkey, and Jordan." "However, the Green Berets assigned to this mission are outraged for another reason: many of the “moderate” rebels they are charged with training are actually ISIS and al-Nusra collaborators." "However, the article also glosses over the complaints that Green Berets have made about the Timber Sycamore program in which “moderate” rebels actually turn out to be Jihadists." When confronted with this story, Liz Sly of the Washington Post commented: but those are liberal and secular Jihadis, no?
Liz Sly doesn't realize that "liberal and secular Jihadis" is an oxymoron. She and the Washington Post show the depths of ignorance in which the US mainstream is mired. It would be laughable if it were not so serious.

At the beginning of the Iraq War, the Bushies didn't understand the difference between Sunni and Shia Islam. Same with the canard that Iran is the major exporter of terrorism when the jihadis of all stripes are funded and supported by Saudi Arabia and Qatar, which are Wahhabi and Salafi states. These are Sunni factions rather than Shia. They are enemies of Iran, as is Saudi Arabia, and Qatar and Israel, who are allied against Iran and using jihadis as proxies in conjunction with the US, UK and EU.

Angry Arab News Service
Moderate rebels trained by U.S. Green Berets turn out to be Jihadists
Assad Abu Khalil | Professor of Political Science, California State University, Stanislaus

Robert Mackey — “America Belongs to White Men,” Alt-Right Founder Says

Because "we won."

The Intercept
“America Belongs to White Men,” Alt-Right Founder Says
Robert Mackey

Pam and Russ Martens — Who’s Behind PropOrNot’s Blacklist of News Websites

The Martens do some sleuthing into PropOrNot's anonymity, while holding their noses.

Wall Street On Parade
Who’s Behind PropOrNot’s Blacklist of News Websites
Pam Martens and Russ Martens

Neil Wilson — How Basic Income is provided under a Job Guarantee

If you believe in the concept, make a tax deductible charity contribution, pay people and you’re there.
Modern Money Matters
How Basic Income is provided under a Job Guarantee
Neil Wilson

Alexander Mercouris — Russia’s inflation falls to lowest since collapse of the Soviet Union

Latest figures confirm inflation in Russia fell to an annualised rate of 5.8% at the end of November, with prices growing in that month by 0.4%.
As is now becoming tediously regular, this fall in inflation is reported to have “exceeded forecasters’ expectations”.
The Duran
Russia’s inflation falls to lowest since collapse of the Soviet Union
Alexander Mercouris

Sputnik — Trump Unable 'to Pursue a Detente With Russia Single-Handedly'

Although US President-elect Donald Trump has signaled willingness to establish a stable basis for US-Russian bilateral relations, the US establishment and NATO are likely to throw a wrench in the works, James W. Carden, former advisor to the US-Russia Presidential Commission at the US State Department, believes.
While observers are weighing up the possibilities of the US-Russian rapprochement under Donald Trump, James W. Carden, the executive editor for the American Committee for East-West Accord, believes that NATO is likely to come between Moscow and Washington....
These people are not going to pay any attention to Donald Trump's orders and he is going to have fire some people to take charge. Even so, it is questionable as to how successful he can be. There's a lot of people on the other side — deep staters, neocons, war hawks, liberal interventionists, etc. Even if he does get the upper hand, they will be a fifth column waiting to return at the first opportunity, e.g., should Trump be a one-term president.

One this is sure. If Trump cannot get control of the situation, his goal of defeating jihadism will be impossible to accomplish since the fifth column will be supporting it as useful proxies in achieving their  own objectives.

Trump may have beaten the bipartisan Establishment and the war party in the election, the battle for control is far from over.

Sputnik International
Trump Unable 'to Pursue a Detente With Russia Single-Handedly'

Reuters — Trump picks longtime friend of Beijing as U.S. ambassador to China

President-elect Donald Trump will nominate Iowa Governor Terry Branstad as the next U.S. ambassador to China, choosing a longstanding friend of Beijing after rattling the world's second largest economy with tough talk on trade and a telephone call with the leader of Taiwan.
The appointment may help to ease trade tensions between the two countries, the world's two biggest agricultural producers, diplomats and trade experts said. It also suggests that Trump may be ready to take a less combative stance towards China than many expected, they said.
Trump adopts a soft line here that is pro-business. Branstad is a shoe-in for confirmation. Good choice.

Trump picks longtime friend of Beijing as U.S. ambassador to China
Dominique Patton and Steve Holland

Yves Smith — Witch Hunt: “Fake News” Software Touted by CBS Smears Naked Capitalism, ShadowProof, TruthDig, Others; Creator Admits He Made Up Who Went on Hit List

One of most pernicious means underway to crush independent news sites is the release of software tools that brand them as unreliable. This means that hidden developers and the parties that fed them information are beyond any accountability, yet would serve as censors....
The plot thickens. And under capitalism, the push will be on to monetize this.

Naked Capitalism
Witch Hunt: “Fake News” Software Touted by CBS Smears Naked Capitalism, ShadowProof, TruthDig, Others; Creator Admits He Made Up Who Went on Hit List
Yves Smith

Robert Parry — How War Propaganda Keeps on Killing

The “fake news” hysteria has become the cover for the U.S. government and mainstream media to crack down on fact-based journalism that challenges Official Washington’s “group thinks,” writes Robert Parry....
A key reason why American foreign debacles have been particularly destructive mostly to the countries attacked but also to the United States is that these interventions are always accompanied by major U.S. government investments in propaganda. So, even when officials recognize a misjudgment has been made, the propaganda machinery continues to grind on to prevent a timely reversal.
In effect, Official Washington gets trapped by its own propaganda, which restricts the government’s ability to change direction even when the need for a shift becomes obvious.
After all, once a foreign leader is demonized, it’s hard for a U.S. official to explain that the leader may not be all that bad or is at least better than the likely alternative. So, it’s not just that officials start believing their own propaganda, it’s that the propaganda takes on a life of its own and keeps the failed policy churning forward....
Even if a President Trump decides that these tensions with Russia are absurd and that the two countries can work together in the fight against terrorism and other international concerns, the financing of the New Cold War propaganda will continue.
The well-funded drumbeat of anti-Russian propaganda will seek to limit Trump’s decision-making. After all, this latest New Cold War cash cow can be milked for years to come and nothing – not even the survival of the human species – is more important than that.
Consortium News
How War Propaganda Keeps on Killing
Robert Parry

Two More on Basic Income and Job Guarantee

Ellis Winningham — MMT and Modern Macroeconomics
Briefly, on the Job Guarantee, Vital Macroeconomic Policy and the Question of Time
Ellis Winningham

The Minskys
The Basic Income and Job Guarantees are Complementary, not Opposing Policies
Brad Voracek

Stephen F. Cohen — Trump Should Pursue a Policy of Detente With Russia

What a President Trump will face in turning the US-Russian relationship around in the face of implacable opposition from neocons, war hawks, liberal interventionists in Congress and the deep state as well as the corporate media.

Russia Insider
Trump Should Pursue a Policy of Detente With Russia
Stephen F. Cohen | Professor emeritus of Russian studies, history, and politics at New York University and Princeton University

See also
Coming together to generate ideas for a new foreign policy agenda

Center for Citizen Initiatives
Détente Now
Gilbert Doctorow, Ute Finckh-Krämer, Ludger Volmer, Rolf Ekéus and Noam Chomsky
  • GILBERT DOCTOROW Gilbert Doctorow is a professional Russia watcher going back to 1965. He is a board member and European Coordinator of the American Committee for East-West Accord.
  • UTE FINCKH-KRÄMER Ute Finckh-Krämer, Member of the German Bundestag, SPD, is Member of the Committee on Foreign Affairs and Deputy Chairperson of the Subcommittee on Arms Control and Disarmament in the German Bundestag.
  • LUDGER VOLMER Ludger Volmer was a member of the German Bundestag from 1985 to 1990 and 1994 to 2002. He was undersecretary of state from 1998 to 2002.
  • ROLF EKÉUS Rolf Ekéus of Sweden was executive chairman of the UN Special Commission on Disarming Iraq from 1991 to 1997. He chaired the drafting of the principles of the Charter of Paris in 1990, a founding document of the Organization for Security and Cooperation in Europe.
  • NOAM CHOMSKY Noam Chomsky, Institute Professor emeritus at MIT, has written many books and articles on international affairs, in particular on Israel and Palestine. His latest book is Who Rules the World?

FNMA to raise loan limit in 2017

Another bullish development for 2017. First increase since GFC.

Non-Cartel Permian Region Oil Production Increase back to previous high

The function is not the rig count, the function is the rate of increase of production.

Richtopia — Economists Top 100: From Paul Krugman to Michael Porter, These Are the Most Influential Economists in the World

Stephanie Kelton makes the list at #28. Congratulations!

Economists Top 100: From Paul Krugman to Michael Porter, These Are the Most Influential Economists in the World
Inspired by Tim Campbell

Anthony DiMaggio — Post-Fact Politics: Reviewing the History of Fake News and Propaganda

My point is simple: fake news is nothing new.  We have long lived in a post-truth society, with political propaganda dominating the “mainstream” news media, and contributing to disinformation campaigns aimed at manipulating public opinion.  Edward Herman and Noam Chomsky documented the propagandistic elements of the news media in detail in their seminal Manufacturing Consent (MC) nearly three decades ago.  Other works preceding MC – such as Herbert Schiller’s The Mind Managers – also emphasized the efforts of political, economic, and media elites to manipulate public preferences via propaganda.
I’ve devoted my academic career to spotlighting propaganda, writing numerous books on the subject.  So it’s more than a little disturbing when I see references to “propaganda” in the corporate press that completely obscure the broader role that manipulation plays in reinforcing domestic political-economic elites’ agendas and in padding the pocketbooks of corporate media conglomerates.  Empirical media studies have documented since the 1970s the overwhelming government dominance of the news. Government control of the news is uncontroversially labeled propaganda in dictatorships like North Korea and the old Soviet Union, but when journalists working for private media corporations willingly roll over for government interests, allowing them to monopolize newspapers and the airwaves in favor of their own agendas, we call it “objectivity.”  So it is in an effort to add some sanity to our modern discussion of propaganda that I draw CounterPunch readers’ attention to the longstanding existence of fake news propaganda in U.S. media....
Move along. Nothing to see here.
Post-Fact Politics: Reviewing the History of Fake News and Propaganda
Anthony DiMaggio | Assistant Professor of Political Science at Lehigh University

Robert Mackey — Disinformation, Not Fake News, Got Trump Elected, and It Is Not Stopping

The crazy just got crazier.

The Intercept
Disinformation, Not Fake News, Got Trump Elected, and It Is Not Stopping
Robert Mackey

Sputnik — Saudi King Urges World Powers to Stop Bloodshed in Syria

Crocodile tears from the main support and financier of jihadism as their jihadis get kettled in Aleppo.

Saudi King Urges World Powers to Stop Bloodshed in Syria


Fort Russ
Lavrov gives last chance to Aleppo terrorists: "Leave politely or be destroyed"
RusVesna - translated by J. Arnoldski

Trump Pledges to End US Regime Change Policies Around the World

The Duran
BREAKING: Al-Qaeda commanders negotiating surrender in Aleppo, Jihadi stronghold collapsing

Sputnik — New Study Suggests Plants Can Learn and Form Memories

The University of Western Australia has published a new study offering evidence that plants are conscious entities who can make links between events to learn about their environment. It was previously thought that only organisms with brains (i.e. most animals) were capable of doing this....
Depends on the definition of "conscious" and "consciousness."

From the POV of monistic idealism, only consciousness exists, that is, consciousness is the Urstoff (primary stuff) and Urgrund (ultimate foundation). This is the view of perennial wisdom.

The other major metaphysical  POV's are 1) monastic materialism, which holds that matter is the Urstoff and Urgund, 2) dualism, which holds that the basic stuffs are mind and matter and the foundation is their relationship, and 3) atomism, which holds that there are two basic stuffs, atoms (elements) and void (space), the foundation being the laws in terms of which they are related. Skepticism is the POV that denies that human can know anything metaphysical and that these are just gratuitous assumptions.

These are the chief metaphysical points of view. There are nuances in each held by different thinker and schools of thought. Epistemology or the study of knowledge, ethics or the study of action, and aesthetics or the study of sensibility are influenced by metaphysical assumptions and these four influence subbranches of thought such as social and political philosophy and natural philosophy, which is now called science.

Everyone has a world view that is implicit and remains so for most people. It is probably impossible to make an entire world view explicit. World views are based on the assumptions of POV whose foundations are metaphysical, epistemological, ethical and aesthetic. These assumptions are the presumptions upon which people operate and for the most part remain hidden and unexamined.

Tuesday, December 6, 2016

Russell A. Whitehouse — The Death Of The Left

Neoliberals have yet to find an answer to this worldwide sea change. As long as leftists dismiss the phenomenon as nothing more than sheer racism and stupidity, they will continue to evade potential answers. Working class people from Pennsylvania to Paris are hurting due to unprecedented upward wealth redistribution, shrinking jobs in both skilled and unskilled labor, soaring costs of living, college tuition, kabuki bureaucracy and collective trauma from the Wars on Drugs and Terror. Voters aren’t stupid; they’re getting tired of the platitudes, plundering and plutocracy of the Global Gilded Age. If the status quo doesn’t come up with any solutions, the populace will seek them elsewhere…
Eurasia Review
The Death Of The Left – OpEd
Russell A. Whitehouse

Bill Mitchell — Australian national accounts – inexorably marching towards recession

Illustration of how to look at national accounts data from the MMT POV.

Bill Mitchell – billy blog
Australian national accounts – inexorably marching towards recession
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Scott Adams — Trump and the Secretary of State “Brand” Decision

Selection from the angle of persuasion.

Scott Adams' Blog
Trump and the Secretary of State “Brand” Decision
Scott Adams

David Edwards — Fake News About 'Fake News' - The Media Performance Pyramid

To reiterate, 'fake news' is said to refer to 'websites [that] publish hoaxes, propaganda, and disinformation to drive web traffic'. A simple, table-top experiment can help us understand why this definition can be generalised to all corporate media, not just social media.
Place a square wooden framework on a flat surface and pour into it a stream of ball bearings, marbles, or other round objects. Some of the balls may bounce out, but many will form a layer within the wooden framework; others will then find a place atop this first layer. In this way, the flow of ball bearings steadily builds new layers that inevitably produce a pyramid-style shape.
This experiment is used to demonstrate how near-perfect crystalline structures such as snowflakes arise in nature without conscious design. We will use it here as a way of understanding Edward Herman and Noam Chomsky's 'propaganda model' of 'mainstream' performance.
Imagine now that the four sides of the wooden framework are labelled to indicate the framing conditions shaping the corporate media:

  1. Corporate nature, elite/parent company ownership and profit-maximising orientation
  2. Dependence on allied corporate advertisers for 50% or more of revenues
  3. Dependence on cheap, subsidised news supplied by state-corporate allies
  4. Political, economic, legal carrots and sticks rewarding corporate media conformity and punishing dissent
When facts, ideas, journalists and managers are poured into this framework, the result is a highly filtered, power-friendly 'pyramid' of media performance. Every aspect of corporate media output is shaped by these framing conditions.…
Put simply, it is not reasonable to expect corporate media to report honestly on a world dominated by corporations. With perfect irony, the latest focus on 'fake news' is itself fake news because the corporate media never have discussed and never will discuss the framing conditions that make it a leading purveyor of 'hoaxes, propaganda, and disinformation'.…
Media Lens — Editorial
David Edwards | Editor
 ht Yves Smith at Naked Capitalism

The Stupidity of the Elites

I think Matt Franko might be right! The incompetence at the highest levels is too great for it ALL to be just a "neo-liberal conspiracy" (not that any of us on the receiving end of Franko's jab ever say that the economic misery is ALL due to elite bloodsuckers). Let me elaborate.

For the sake of this little experiment, lets just go ahead and assume that all the worst parts about the "neo-liberal conspiracy" are true as best described IMHO by Kalecki's masterwork "Political Aspects of Full Employment" . A sample for the those that havent read it:

"In should be first stated that, although most economists are now agreed that full employment may be achieved by government spending, this was by no means the case even in the recent past.  Among the opposers of this doctrine there were (and still are) prominent so-called 'economic experts' closely connected with banking and industry.  This suggests that there is a political background in the opposition to the full employment doctrine, even though the arguments advanced are economic.  That is not to say that people who advance them do not believe in their economics, poor though this is.  But obstinate ignorance is usually a manifestation of underlying political motives."

and a little later....

The attitude is not easy to explain.  Clearly, higher output and employment benefit not only workers but entrepreneurs as well, because the latter's profits rise.  And the policy of full employment outlined above does not encroach upon profits because it does not involve any additional taxation.  The entrepreneurs in the slump are longing for a boom; why do they not gladly accept the synthetic boom which the government is able to offer them?  It is this difficult and fascinating question with which we intend to deal in this article.
The reasons for the opposition of the 'industrial leaders' to full employment achieved by government spending may be subdivided into three categories: (i) dislike of government interference in the problem of employment as such; (ii) dislike of the direction of government spending (public investment and subsidizing consumption); (iii) dislike of the social and political changes resulting from the maintenance of full employment.  We shall examine each of these three categories of objections to the government expansion policy in detail."
 Here's 1:
"Under a laissez-faire system the level of employment depends to a great extent on the so-called state of confidence.  If this deteriorates, private investment declines, which results in a fall of output and employment (both directly and through the secondary effect of the fall in incomes upon consumption and investment).  This gives the capitalists a powerful indirect control over government policy: everything which may shake the state of confidence must be carefully avoided because it would cause an economic crisis"
 Here's 3 (The most important one in my view):
"We have considered the political reasons for the opposition to the policy of creating employment by government spending.  But even if this opposition were overcome -- as it may well be under the pressure of the masses -- the maintenance of full employment would cause social and political changes which would give a new impetus to the opposition of the business leaders.  Indeed, under a regime of permanent full employment, the 'sack' would cease to play its role as a 'disciplinary measure.  The social position of the boss would be undermined, and the self-assurance and class-consciousness of the working class would grow.  Strikes for wage increases and improvements in conditions of work would create political tension.  It is true that profits would be higher under a regime of full employment than they are on the average under laissez-faire, and even the rise in wage rates resulting from the stronger bargaining power of the workers is less likely to reduce profits than to increase prices, and thus adversely affects only the rentier interests.  But 'discipline in the factories' and 'political stability' are more appreciated than profits by business leaders.  Their class instinct tells them that lasting full employment is unsound from their point of view, and that unemployment is an integral part of the 'normal' capitalist system."

The problem with this is obvious when you think about it. Even the greediest SOB in the world would have to agree with this. Its the scale. Just take your standard long term projection, something on the order of those 75 year doomsday forecast scenarios. Lets just set our goal as wanting to be the first nation to achieve a $100 trillion economy.

$17 to $100 trillion takes 60 years at 3% average growth, yet it takes 90 years at 2%, which is all that our idiot leaders can seem to manage nowadays.

But time is not at all the worst way to look at it, the dollar differences are just off the charts.

in 2075, a 3% economy from the US today would be $100 trillion, and a 2% economy be just $55 trillion.

Thats almost twice as much loot!

Or a final and even more depressing way to look at it, our competent maths people might guess whats coming next, the numbers go parabolic in a hurry.

By the time that a 2% average US economy gets to $100 trillion in 2105, a 3% economy would be generating a staggering $243 trillion in real wealth every year.

Thats $143 trillion in future wealth that our so-called "leaders" are depriving everyone's kids of at the turn of the century.

I know that the present is great for these rich asssholes but I have to believe that they love their kids enough to want them to be more than twice as well off, their country to be even that much more powerful and secure, whatever it is that satisfies someones priorities. For fuck sake's just give us 1% more please.

Stratfor — Italy After the Referendum. What comes next?

Stratfor analysis.

Fabius Maximus
Stratfor: Italy After the Referendum. What comes next?