Author Archives: Tim Worstall

I am aware that the image is not the best: the point is that the red line shows that concern about the EU was entirely manufactured since the beginning of 2016: it was simply not an issue for the vast majority before then,

Umm, odd, that.

How was there the pressure to have a referendum (the bill was in 2015) if no one gave a toss. How come, when people voted actually about Europe then Ukip, the peeps shouting about the EU, did so well every time?

Peter Bofinger is professor of economics at Würzburg University and a former member of the German Council of Economic Experts. He has written an excellent, and accessible, article on Social Europe in which he explains why Keynesian thinking explains the world as it is, and neoclassical economics explains a world that does not exist.

Hmm, neoclassical economics manages to explain an awful lot of the world but still, let’s see what is being said:

[T]he laws of motion of the classical and the Keynesian world view differ…. In the classical model saving generates investment. In the Keynesian model investment generates saving. In the classical model saving and investment determine the interest rate. In the Keynesian model saving and investment determine aggregate output.

Ah. The classical model is different from the neoclassical model. Markedly so.

Something that Snippa seems not to know. And Snippa used to be a professor of economics at a British university.

Ho Hum.

And it is why neoclassical economics continues to help destroy us, our economies and our planet. And it has to go.

Just to remind everyone what the three major tenets of neoclassical economics are:

People have rational preferences between outcomes that can be identified and associated with values.
Individuals maximize utility and firms maximize profits.
People act independently on the basis of full and relevant information.

Which of these does Ritchie want to junk? No, not which should people not do but which don’t they?

I also think that the editorial missed a killer punch. That was, first of all, because they kept referring to Keynes, and not his motives, and yet it is his motives, and their contrast with those of monetarism that is critical. Keynes was motivated by social concern: monetarism was motivated by the desire for private profit. Keynes was about creating fairer societies, and monetarism was about creating inequality.

Really? And here’s every economist in the world thinking that they’re just two proposed methods of dealing with the business cycle.

And not all that different either, Keynes himself runs with the idea that fiscal policy is what you do in that special case when monetary no longer works. Oh, and QE is derived from Keynes’ insistence that the velocity of circulation of money does indeed vary….

This is correct, and yet it needs contextualisation. We have just seen an election where policies in the shadow of Keynes did not prevail. Whilst nationalisation, social housebuilding, the welfare state and much else that might be associated with Keynesian policy all poll well with focus groups they did not deliver election success for Labour.

Keynes of course being a pre-war Liberal. Not notably in favour of all of those things.

Nor, come to that, did the Green New Deal in the way that Labour presented it. And that is because Keynes did not just want these things, as if they in themselves mattered. What he was particularly interested in, I suggest, was what they could deliver for people. In other words, what he wanted to address was not just an economic crisis, but the oppression of people’s hopes and aspirations and their replacement by fear. He knew he was fighting fascism, and he played a key role in achieving that goal.

Rilly? Il Musso saw Keynes’ economics as being at worst “not incompatible with fascism” and the Nazis were probably the first to put them into action. Building infrastructure to stimulate the economy? Heard about the autobahns?

Keynesian spending is about transforming relationships in society.

And that’s not something you’ll find in Keynes.

The report released on Monday suggested any action by the government to close loopholes at the budget would be positively received. That includes remedying the situation where someone who lives purely off dividends from shares pays a lower rate of income tax than someone who is working.

The tax rate on dividends is the income tax rate plus the corporation tax already charged at the level of the company.

But then Tax Justice is run by Alex Cobham who has been known to get complicated matters like adding up wildly wrong.

Amazingly, the report doesn’t actually mention the idea nor question.

And now here’s what’s vile:

In our next report, we will explore what ways
of communicating on tax and wealth resonate
the most with the public and how to shift
people’s views.

This is a propaganda project. How do we get people to agree to higher taxes?

This report was prepared with funding from the
Friends Provident Foundation and the ESRC Impact
Acceleration Awards via The University of Sheffield’s
Internal Knowledge Exchange Scheme.

Yep, via the ESRC we’re paying tax to be persuaded to pay higher tax.

Fuck ’em, eh?

Snippa tells us:

The simple facts stand out. After five years most people who have cancer in the USA are alive. In fact, overall it looks like there might be a near nine in ten chance of that.

And the associated cost is a 40% chance of bankruptcy.

That is no way to run a health service.

And yet this is the model those in office in the UK aspire to.

So, 90% 5 year survival rate.

In the NHS?

The UK government said other data showed that one-year survival rates in England, for all types of cancer, were at a record high.

One-year survival has increased from 62% in 2001 to 72.8% in 2016.

The one year NHS survival rate is nearly 20 percentage points lower than the American 5 year one?

Might we not say that the NHS isn’t the health care model to aspire to?