Posts by BenWilson
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Hard News: 2011: The Year Of What?, in reply to Patrick Reynolds,
How do you like them apples?
The crisp sweet crunch of a real election, but a nasty all black maggot in the middle?
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Hard News: 2011: The Year Of What?, in reply to Sacha,
Bernard Hickey sure seems to be having more fun.
Must be nice as an economist to be able to break the neoliberal consensus and actually think about problems for oneself. Good on him.
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Hard News: 2011: The Year Of What?, in reply to David Cormack,
Well I had a great weekend, and was feeling very positive. Then I read this thread. Goodness me, talk about the Public Address-men of the Apocalypse.
Each to their own. I find all of this, apart from Christchurch exciting. My own personal 2011 fallout, being unemployed for the first time since 1995, and liking it. To me it feels like the politics of most of my adult life have been both wrong and horribly dull, and we stand on the cusp of a big rethink. When we realize we've been wrong for many years (something I've believed for many years), the future of possibilities opens up. Nothing is off the table now, either for me, or for the world.
I had a very interesting discussion with my Grandmother recently, who lived through the Great Depression. She told me something interesting - it was the most exciting time of her life, that everyone partied like there was no tomorrow. The parties were cheap as could be, but that didn't make them less fun. Faced with adversity, people can work together, and that can be extremely enjoyable and empowering in the way that a secure future often isn't.
Can this year be the year of parties? We've still got 4 months to make it so.
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Hard News: Is that it?, in reply to bmk,
Well the prostitute provided a service. So it's not like the debt magically disappeared.
In Rich's example, she already owed the hotel money, and the payment she got was money owed to her. So the point he's making, that the mere existence of the token that let money move around does indeed resolve, in the situation where there is a debt circle.
If only there was a mutual debt circle. It's usually more like there's a rich guy in town, who everyone owes money to.
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Hard News: Is that it?, in reply to Rich Lock,
I'd like to add to my previous post that this outlook is only predicated on countries failing to change they way they manage money. Any number of small tinkerings could make a substantial difference to overall competitiveness, general fairness, and economic growth. We could avoid the slide to third world status, simply by opting out of the way of managing finances that left it to markets and bankers to ruin.
This opting out can happen at a personal level, a social level and a national level.
We can opt out of running up personal debt. We can opt in to saving, and in a longer run, investing. We can help people we care about for free. We can change government policy.
I hate the sweeping rhetoric that suggests we're powerless before the forces of globalized capital. We're very far from powerless. Every person can talk to the people they know aiming to turn them from the disastrous path of trusting fatcats to work it all out for us.
I'm feeling particularly inspired today, the example of Libya has me feeling positive about world affairs for the first time in months.
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Hard News: Is that it?, in reply to DexterX,
With respect – many of these posts, to me, show a lack of an understanding of the nature of money and how the economy operates.
Feel free to pitch in. What do you think should be changed, if we are to avoid those decades of stagnation? Or do you think avoiding them is impossible? Or even undesirable?
To me, the source of the stagnation is obvious. Western economies no longer own the means of production. There is quite literally nothing that they make that can't be made somewhere else cheaper.
It's capitalism rebalancing the world economy. The rebalancing is obviously going to involve the developed world getting relatively poorer and poorer, although wealth in absolute terms might rise overall - if industrial output continues to rise and technology continues to make new things. But the distribution of the wealth in the developed world is likely to become less and less fair as the main means by which wealth can actually be transferred to poor people, through their labour, dries up.
It's quite a bizarre thing, really, that a fairer distribution of world wealth could arise from the system. By which I mean it will be spread around the world better - the actual distribution of it within any small piece of the world will be more iniquitous than most Western countries have been accustomed to for a long time, poverty will be visible everywhere, right next to extraordinary wealth. Much like it was for most of human history.
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Its premised on trusting clear definitions of roles and the impartiality of bureaucratic institutions over magical "mandate" driven management.
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Hard News: Is that it?, in reply to Sacha,
That's quite a far cry from taking the KiwiSaver funds and using them arbitrarily. That would go down about as well as if they reached into 2 million bank accounts and tried to do the same thing. Because it would actually be the same thing.
Yes, this kind of looting is possible, if the implementation of the policy is done extremely poorly, like, say, leaving it entirely to the government to manage the money, rather than simply letting the government set rules about how it can be managed. This is one of my biggest objections to the Cullen Fund. The very idea of a fund of savings that the government can steal is part of the reason I'm not in Kiwisaver yet. I do have private super, though, and my ozzie super. The first of those would be very, very hard for the government to steal. The second, impossible.
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History suggests governments may respect that less than you think - easy enough to change law to affect those other pools of money, even nationalise them in the name of some fiscal emergency.
History suggests that governments can attack dissidents with helicoptor gunships, or poison gas. But in societies in which the rule of law takes quite high precedent, it is quite possible to set up legal institutions that are very difficult for the government to supersede. Yes, they can just seize any funds they like, but it could come at an extremely high cost to them politically. Considering the current ruling parties can barely make any changes at all without consulting the polls in apprehension, I think dipping their hands into funds belonging to NZers of all political affiliations would be suicide unless there was a very, very good justification, in which case, I'd actually want to hear it. They haven't been able to do a damned thing about National Super in 30 years. I highly doubt they'd start seizing pension funds.
Who do you trust to share the interests of our children and grandchildren?
I don't trust anyone, not even myself. I think they are the best custodians of their own interests, in the long run, and the more empowered they are, the better those interests will be catered for. I have some other ideas about how that could be done.
I think what Ben leans towards is a syndicalist or co-op model, rather than the paternalist model you refer to.
I don't know if that's true. My ultimate aim is for increased wealth and decreased class difference, which I think would have transformative effects on the way business is done, although I'm actually not bold enough to predict what those would be. Yes, ultimately, I have various visions of possible utopias, but utopianism has been around for a long time, and it's always been short on the "how do we get there?" part. We have to acknowledge that we live in a capitalist world, and that smashing that world apart has actually been tried several times, at enormous human cost, with mixed results. We've also tried a middle path of progressive taxing, but still there is ample inequity. We've tried weakening that, to see if that helps, but it's clearly made the inequity worse, and yet to increase taxation has become politically difficult.
That does not mean we're out of options. We can still tinker with lots of ways of working on social inequity whilst keeping ourselves productive. It's on us to work out what those should be, rather than centuries old philosophers, or trusting to our leadership, who clearly have no idea. It's amazing how much quite small stepwise changes to the economic system can change things in a short time. And things that clearly make society as a whole work better end up being bipartisan.
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Hard News: Is that it?, in reply to DexterX,
This sits nicely alongside what the Nats are looking to do with the food stamp card.
Not really. It's not much like that at all. The money is still your own money, to be used as money, when it you retire, for whatever you want.
I guess I just don't buy into this whole "sanctity of our own money" thing anymore. I did before I lived in Oz, and I was annoyed by their super scheme, but after only a few years it made one hell of a lot of sense. It's a big chunk of real money sitting there for me one day.
The other reason I don't buy the sanctity of money is because we already have income tax which is exactly the same thing, the government taking your money and doing something supposedly in the public interest, which should include your interest. That's many times more fucked up in terms in compulsion, but socialist buy into upping that *all the time*. Then they scratch their heads when right wing governments are elected that squander their money, sell of their investments, and bail out their mates.
They can't bail out their mates with funds from schemes that do not actually belong to the giant slush fund that is the government tax coffers. It's like putting everyone in the country's future in trust.
To me compulsory savings are simply a highly practical middle ground that have been proven to enrich the countries, and the citizens in them, where substantial schemes have existed. As I say, they're enforcing good management of funds, something socialists are always banging on about as should be done to companies, rich people, fund managers, and the government. The idea of compelling themselves to do it seems to fill them with horror. In my mind that's how far neoliberalism has spread that even left-wing people are horrified at the thought of compulsion around money, except when they can take it from "wealthy" people in the form of tax.
Yes, the funds could be lost in some bad way. The fund managers could invest them poorly, and they lose value. They could be stolen by crooked accountants. They could be invested in immoral things.
But there are many, many ways to tinker with the overall solution to make these things less and less possible. You can place rules around the investments so that they can't be put into things that are too risky - probably insisting on a wider spread of asset classes would achieve that. Make sure that pension funds have to have t-bills, property, local stocks, and utilities in them, in certain proportions. Or maybe make quite strict money management and auditing certification a requirement for certain classes of investment, so they can't, for instance, have too much debt. You can place the stockmarket part of the fund entirely in the hands of person owning the fund, if they apply for the right to do this, then they can invest it exactly how they like, overseas straight into Lockheed Martin, if they have no souls, or locally into something righteous if that is important to them. So long as its invested, rather than simply being spent, that's the main purpose sorted.
And don't forget they've still got ALL of the rest of their money to spend exactly however they want. If they're ambitious, they can save and invest some of that too. They can get a mortgage. They can buy consumer electronics. Or they can pay the rent and for food, if they're low wage.
If they really are facing hardship, as sometimes happens, then they should be allowed to make application for the funds to be prematurely withdrawn. That makes good sense when people lose their jobs and the economy is down and they can't get a job. It just doesn't make sense when their idea of destitution is that they can't afford the deposit on a brand new car. In those cases, they can bloody well save up the other money they have, or do without.
I'm not even against the food stamps idea. I just think everyone in the country should get them. To single out the young unemployed is simply attempting to stigmatize them for the crime of being young and the economy having been mismanaged by their elders.
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