Archive for November, 2010

Inside Job

I’m going to try to see this film this weekend. Review coming soon… but it looks excellent! Currently opening at select theaters.

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Inequality Chartified

David Ruccio posted an excellent series of charts on inequality (pdf, ppt, and mov links at the top). For example,

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Check out Round Two of the viral Keynes vs Hayek  rap, “Fear the Boom and Bust,” followed by a panel discussion with the creators of the video [ht:ok]. I must say, I do appreciate this non-traditional method of encouraging pluralistic economic discourse!

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Yves Smith has a thoughtful post about voting as a right vs. voting as a duty. The campaign season leading up to last night’s midterms reinforced what has long been known: the United States needs to reform its electoral system. A more engaged and thoughtful public would not tolerate the circus that is the current public debate. Yves provides some good suggestions from experience in Australia, such as fining people who do not vote and allotting a fix amount of ad airtime instead of letting money buy it.

Secondly, I am still trying to figure out an answer to the question: What has Obama done so far? [ht:cr] It is hard to understand how so many people who voted for him seem to have forgotten where Republican policies had gotten us.

Lastly, I saw senator-elect Rand Paul’s victory address, and was struck by some of his comments:

When I arrive in Washington, I will ask them respectfully to deliberate upon this: We are in the midst of a debt crisis, and the American people want to know why we have to balance our budget and they don’t.

I will ask them respectfully to deliberate upon this: Government does not create jobs; individual entrepreneurs, business men and women create jobs, but not the government.

I will ask the Senate respectfully to deliberate upon this: Do we wish to live free, or be enslaved by debt? Do we believe in the individual, or do we believe in the state?

I believe that money matters to the real economy. Not all economists do – some take a serious general equilibrium approach, in which case money does not matter. But the economy doesn’t work like that. If there is debt, debt-deflation can change economic prospects: if you owe a fixed nominal rate of money, and prices decrease, in real terms you will owe more money, leading to a wealth effect that changes your willingness to spend money. Here is a case where money matters for the real economy.

But Mr. Paul just goes around saying that government debt matters, and that the federal government needs to balance the budget. But WHY? What does it matter for the real economy? Until these connections are carefully made, between finance and the real economy, the Tea Party has no coherent message. It would not be bad to balance the budget someday. But right now, in the midst of the greatest recession since 1929, these ideas are ludicrous.

Lastly, GOP leaders are looking to repeal the recently passed healthcare law. I just hope we can first end all the misinformation:

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In this video, UMass economist Arin Dube discusses his paper, blogged about here, in laymen’s terms. The interviewer, from The Real News, raises some key common criticisms of this type of work, and Dube handles them well.


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