Archive for May 23, 2013

‘…In normal times, an arithmetic mistake in an economics paper would be a complete nonevent as far as the wider world was concerned. But in April 2013, the discovery of such a mistake—actually, a coding error in a spreadsheet, coupled with several other flaws in the analysis—not only became the talk of the economics profession, but made headlines. Looking back, we might even conclude that it changed the course of policy…’

…click here to go through to the piece in full & free at The New York Review of Books…

Here in Australia, as we head towards September’s federal election, conservative politicians are once again spruiking their mantras of fear and loathing, in conjunction with a “delusional” misreading of basic economics.

As the Abbott/Hockey rhetoric demands that all Australians “be afraid, be very, very afraid…of, look, at the end of the day, err, everything…” at the interpretOr, we’ll be beavering away across realms digital to find evidence to the contrary.

As an introductory antidote to such neoLiberal gobbledigook, here’s Paul Krugman in a recent Guardian interview…

....(Paul Krugman's) following is a reward for battling the conventional wisdom that austerity can foster a recovery. From the moment Lehman Brothers was allowed to crash, it seemed that only Krugman, his compatriot Joseph Stiglitz, another Nobel prizewinner for the liberal cause, and New York professor Nouriel Roubini, who had loudly predicted the crash, consistently confronted the "austerians" in Washington, Brussels and the UK Treasury.
More than four years on, austerity is being questioned as never before, not least because most countries implementing a deficit-reduction policy have failed to grow. Krugman, his blog and comments on Twitter, have become the focal point for objectors worldwide.
Speaking to the Guardian to publicise the second edition of his book End This Depression Now, he argues that his battle will go on until policymakers realise that their reliance on deficit reduction is a "delusional" misreading of basic economics. But despite his persistent criticism, austerity remains the default position for most western governments.

Oh, and here’s a local fear-buster from Russell Marks at THE CONVERSATION:

Public debt in Australia is not a problem. The ratio of public debt to GDP is about 27%, compared with an average of about 90% for developed economies. And Australia is well down the list of effective taxation rates among OECD nations.
Indeed, on standard economic measures, Australia is not only performing better than the rest of the world, but performing better now under Labor than it was when Labor took office from the Liberal-National Coalition in 2007. Since then, GDP per capita hasclimbed 13%. Real wage levels have increased 27%. Household savings have more than doubled. Labour productivity is now at an all-time high, and is a clear eight index points higher than in 2007...

a timely reminder?

the interpretOr

The SMH today claims that “opposition Leader Tony Abbott’s Press Club speech attacked the very point Labor sees as its greatest strength — economic management — armed with little more than rhetoric and previously announced promises.”

The interpretOr would like to reinforce the emptiness of Abbott’s rationale with a few more words from Nobel laureate, Professor Joseph Stiglitz, a former World Bank chief economist and economic adviser to the US government…

“[Labor] actually did a fantastic job of saving your country from problems.”

Stiglitz applauds the objectives of the government’s mining tax but was not surprised at the response of BIG MINING…

“Having watched what happened in the United States I’m not surprised at all what’s happened here; the mining companies do not want to pay their fair share.”

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