Krugman et al

[tommy]

Aquela história do investimento público, multiplicadores e tal, aplica-se a estes casos ?

Espanha: Chineses pagam 10 mil euros por aeroporto que custou 450 milhões

No fim de contas isto deve ter gerado muito emprego (a dignidade das pessoas empregadas não tem preço), dinamização de empresas, impostos que pagaram, etc.
Mesmo não servindo para nada e quase oferecido deve ter tido uma rentabilidade económica grande, não ?

a esse preço é porque tem umma divida enorme

E a receita deve ser 0 zero, então desde que iberia de lá saiu... ou era a vueling? Penso que agora não têm nenhum operador por lá.

[Lark]

Aquela história do investimento público, multiplicadores e tal, aplica-se a estes casos ?

Espanha: Chineses pagam 10 mil euros por aeroporto que custou 450 milhões

No fim de contas isto deve ter gerado muito emprego (a dignidade das pessoas empregadas não tem preço), dinamização de empresas, impostos que pagaram, etc.
Mesmo não servindo para nada e quase oferecido deve ter tido uma rentabilidade económica grande, não ?

o que é que isto tem a ver com o krugman?

L

[Lark]

This is what economists don’t understand about the euro crisis – or the U.S. dollar
By Kathleen McNamara July 21 at 11:12 AM
 

Prominent American economists are weighing in on the Greek debt crisis, with more than a hint of schadenfreude. The title of a New York Times op-ed by Gregory Mankiw says it all in one smarmy sentence. “They told you so: Economists were Right To Doubt the Euro.” Economists are condescendingly scolding the Europeans for venturing into a single currency without the proper underlying economic conditions. Paul Krugman has relentlessly excoriated the leaders of Europe for being what he calls “self-indulgent politicians” who have “spent a quarter-century trying to run Europe on the basis of fantasy economics.” The conventional wisdom seems to be that the problems of the euro zone are, as economist Martin Feldstein once put it, “the inevitable consequence of imposing a single currency on a very heterogeneous group of countries.”

What this commentary gets wrong, however, is that single currencies are never the product of debates about optimal economic solutions. Instead, currencies like the U.S. dollar itself are the result of political battles, where motivated actors try to centralize power. This has most often occurred “through iron and blood,” as Otto van Bismarck, the unifier of Germany put it, as a result of catastrophic wars. Smaller geographic units were brought together to build the modern nation state, with a unified fiscal system, a common national language that was often imposed by force, a unified legal system, and, a single currency. Put differently (with apologies to sociologist Charles Tilly), war makes the state, and the state makes the currency.

The U.S. case is instructive. America used to have a chaotic multitude of state currencies and privately issued bank notes, with complex exchange rates between them. This only changed thanks to the Civil War. The American greenback was created in 1863 when Abraham Lincoln’s Republican Party muscled through legislation giving the federal government exclusive currency rights. It was only able to do this because Southern legislators, who opposed more centralization of power, had seceded from the American union. The Union side wanted a common currency to help the war effort by rationalizing revenue raising and wartime payments. But it was also a potent symbol of the power of the federal state in the face of the challenges of a disintegrating union.

All of the institutions that saved America’s common currency from Krugman’s “fantasy economics” were the result of hard fought political battles. The U.S. already had some of the building blocks for a fiscal union. Alexander Hamilton, the country’s first secretary of the treasury, prioritized the ability to issue and raise debt at the federal level and build a robust financial system. Randall Henning and Martin Kessler have documented the vitriolic 19th century fights over federal bailouts of the U.S. states, which finally resulted in state level balanced budget rules, but only as part of a bargain over increased federal fiscal relief. Banking union in the United States likewise took a long period of time to build, and only came about as a result of a series of horrific financial crises, culminating in the Great Depression. Most strikingly, the U.S. did not have a permanent national bank until the U.S. Federal Reserve was finally set up in 1913. A series of severe financial crises had created political will to centralize monetary power in a federal reserve board. Even so, the Fed still stayed at the center of a federal system of regional banks.

Economists argue about whether U.S. institutions provide a good model for Europe. Josh Barro, in the Upshot column at the New York Times, explicitly compares the euro zone to the U.S. federal system, arguing that fiscal redistribution can cushion the impacts of crisis. Martin Sanbu of the Financial Times disagrees, and claims that fiscal union is not as necessary as American economists believe. However, Barro doesn’t really appreciate the historical conditions that allow a single currency to come to life, while Sanbu is wrong on the timing of U.S. fiscal history Both these accounts lose sight of the broader reality: that money has always and everywhere been part of broader projects of political consolidation. This means that it has always been highly contentious.

European leaders weren’t stupid or self indulgent when they decided to move ahead with the euro, without fiscal union or strong Europe-level democracy. They just cared more about politics and international security than economics. They wanted to build a Europe that had transcended the divisions of the Cold War, and bind together Germany, which was reunited and much more powerful, with the rest of Europe. When they did think about economics, they hoped that a strong euro, anchored in an independent European Central Bank located in Frankfurt and built on a commitment to protecting the stability of the currency, would help resolve the problems of currency depreciation, spiraling inflation and economic instability that came with the weak currencies of the “Club Med” countries to the south of Europe.

European leaders, the IMF and the European Commission have done a terrible job at handling the Greek debt crisis. However, criticizing the euro because it doesn’t meet the ideal economic conditions for a single currency is missing the point. The same is true of every project to create a common political system. History does not unfold as a series of neat and sterile decisions made by people rationally trying to create economically optimal policies. It emerges through political struggle and hard bargaining, in which people fight to try to reshape politics, recognizing that even their greatest victories are likely to be messy and inefficient, but hoping that their successors will be able to improve on them. That was the history of the U.S. dollar. We’re still waiting to see whether it will be the history of the euro.

wapo blogs

[tommy]

Pensei que ias colocar aqui o krugman a reconhecer que errou na questão grega, syriza e tsipras.

Só ganhavas uns pontinhos na tua credibilidade que anda pelas ruas da amargura.

[Kin2010]

This is what economists don’t understand about the euro crisis – or the U.S. dollar
By Kathleen McNamara July 21 at 11:12 AM
 

Prominent American economists are weighing in on the Greek debt crisis, with more than a hint of schadenfreude. The title of a New York Times op-ed by Gregory Mankiw says it all in one smarmy sentence. “They told you so: Economists were Right To Doubt the Euro.” Economists are condescendingly scolding the Europeans for venturing into a single currency without the proper underlying economic conditions. Paul Krugman has relentlessly excoriated the leaders of Europe for being what he calls “self-indulgent politicians” who have “spent a quarter-century trying to run Europe on the basis of fantasy economics.” The conventional wisdom seems to be that the problems of the euro zone are, as economist Martin Feldstein once put it, “the inevitable consequence of imposing a single currency on a very heterogeneous group of countries.”

What this commentary gets wrong, however, is that single currencies are never the product of debates about optimal economic solutions. Instead, currencies like the U.S. dollar itself are the result of political battles, where motivated actors try to centralize power. This has most often occurred “through iron and blood,” as Otto van Bismarck, the unifier of Germany put it, as a result of catastrophic wars. Smaller geographic units were brought together to build the modern nation state, with a unified fiscal system, a common national language that was often imposed by force, a unified legal system, and, a single currency. Put differently (with apologies to sociologist Charles Tilly), war makes the state, and the state makes the currency.

The U.S. case is instructive. America used to have a chaotic multitude of state currencies and privately issued bank notes, with complex exchange rates between them. This only changed thanks to the Civil War. The American greenback was created in 1863 when Abraham Lincoln’s Republican Party muscled through legislation giving the federal government exclusive currency rights. It was only able to do this because Southern legislators, who opposed more centralization of power, had seceded from the American union. The Union side wanted a common currency to help the war effort by rationalizing revenue raising and wartime payments. But it was also a potent symbol of the power of the federal state in the face of the challenges of a disintegrating union.

All of the institutions that saved America’s common currency from Krugman’s “fantasy economics” were the result of hard fought political battles. The U.S. already had some of the building blocks for a fiscal union. Alexander Hamilton, the country’s first secretary of the treasury, prioritized the ability to issue and raise debt at the federal level and build a robust financial system. Randall Henning and Martin Kessler have documented the vitriolic 19th century fights over federal bailouts of the U.S. states, which finally resulted in state level balanced budget rules, but only as part of a bargain over increased federal fiscal relief. Banking union in the United States likewise took a long period of time to build, and only came about as a result of a series of horrific financial crises, culminating in the Great Depression. Most strikingly, the U.S. did not have a permanent national bank until the U.S. Federal Reserve was finally set up in 1913. A series of severe financial crises had created political will to centralize monetary power in a federal reserve board. Even so, the Fed still stayed at the center of a federal system of regional banks.

Economists argue about whether U.S. institutions provide a good model for Europe. Josh Barro, in the Upshot column at the New York Times, explicitly compares the euro zone to the U.S. federal system, arguing that fiscal redistribution can cushion the impacts of crisis. Martin Sanbu of the Financial Times disagrees, and claims that fiscal union is not as necessary as American economists believe. However, Barro doesn’t really appreciate the historical conditions that allow a single currency to come to life, while Sanbu is wrong on the timing of U.S. fiscal history Both these accounts lose sight of the broader reality: that money has always and everywhere been part of broader projects of political consolidation. This means that it has always been highly contentious.

European leaders weren’t stupid or self indulgent when they decided to move ahead with the euro, without fiscal union or strong Europe-level democracy. They just cared more about politics and international security than economics. They wanted to build a Europe that had transcended the divisions of the Cold War, and bind together Germany, which was reunited and much more powerful, with the rest of Europe. When they did think about economics, they hoped that a strong euro, anchored in an independent European Central Bank located in Frankfurt and built on a commitment to protecting the stability of the currency, would help resolve the problems of currency depreciation, spiraling inflation and economic instability that came with the weak currencies of the “Club Med” countries to the south of Europe.

European leaders, the IMF and the European Commission have done a terrible job at handling the Greek debt crisis. However, criticizing the euro because it doesn’t meet the ideal economic conditions for a single currency is missing the point. The same is true of every project to create a common political system. History does not unfold as a series of neat and sterile decisions made by people rationally trying to create economically optimal policies. It emerges through political struggle and hard bargaining, in which people fight to try to reshape politics, recognizing that even their greatest victories are likely to be messy and inefficient, but hoping that their successors will be able to improve on them. That was the history of the U.S. dollar. We’re still waiting to see whether it will be the history of the euro.

wapo blogs

Ora aqui está um artigo soberbo. Vai muito par além das análises habituais da questão da crise do euro. Explica-nos muitas coisas novas sobre a temática. Comparado com este artigo, 95% dos outros são só repetição dos mesmos argumentos até à exaustão (quer os da "esquerda" qur os da "direita", quer os "anti-alemães", quer os "anti-gregos").

[Zenith]

O artigo é interessante.
O que o artigo não foca é que os politicos que por vontade politica impuseram o Euro como uma espécie de camisola de forças  da qual não se poderia sair e por isso garantisse a inevitabilidade da união, logo que apareceu a primeira crise foram os primeiros (politicos diferentes) a passar a mensagem que isso da moeda única apenas significava "pegging" e que coisas tinham se ver vistas país a país.

[Lark]

O artigo é interessante.
O que o artigo não foca é que os politicos que por vontade politica impuseram o Euro como uma espécie de camisola de forças  da qual não se poderia sair e por isso garantisse a inevitabilidade da união, logo que apareceu a primeira crise foram os primeiros (politicos diferentes) a passar a mensagem que isso da moeda única apenas significava "pegging" e que coisas tinham se ver vistas país a país.

coloquei isto porque é um ponto de vista diferente do que temos visto.
compara a evolução do USD com a do EURO sendo que a tese é que as moedas avançam por pura força e objectivo político. não económico.

isso que tu estás a observar e bem, faz parte da gestão política da moeda - por definição injusta, caótica, dá o dito por não dito, faço o que interessa e não o que é  suposto etc..

está por isso incluído na tese da autora. é consistente com o que ela pretende passar.

a grécia ficou no euro, por pura força política da frança e da itália.
foi porque os franceses e italianos tinham muita pena dos pobres gregos e não os queriam ver sair da família europeia?

Não. Foi porque a saída da grécia comprometia e fragilizava o objectivo político - francês e italiano - do euro.
Como posição económica foi estupida.
Como posição política faz muito sentido para os franceses e italianos.

Os gregos que se lixem. são meros peões num jogo muito maior que eles.

L

[Lark]

giro: o krugman já a responder ao artigo acima trancrito...

Paul Krugman - New York Times Blog
JUL 22 11:22 AM Jul 22 11:22 am 32

Annoying Euro Apologetics

Are there good arguments against the proposition that the creation of the euro was an epic mistake? Maybe. But the arguments I’ve been hearing lately are really bad. And they’re also deeply annoying.

One argument I keep seeing is that economist critics like myself don’t understand that the euro was a political and strategic project, not merely a matter of economic costs and benefits. Yes, I’m a dumb uncouth economist, completely unaware of the role of politics and international strategy in policy decisions, who never heard of the European project and its origins in the effort to put Europe’s legacy of war behind it, not to mention strengthen democracy in the Cold War.

Well, actually I do know all about that. The point, however, is that while the European project has at every stage combined economic objectives with broader political goals – it’s about peace and democracy through integration and prosperity – the project can’t be expected to work unless the economic measures are a good idea in and of themselves, or at least a non-catastrophic idea. What happened in the march to the euro was that European elites, in love with the symbolism of a single currency, closed their minds to warnings that currency union – unlike the removal of trade barriers – was at best ambiguous in its economic logic, and arguably, even ex ante, a very bad idea indeed.

An alternative argument, which we’re hearing from depressed European economies like Finland, is that the short-term costs of inflexibility are outweighed by the supposedly huge gains from greater integration. But where’s the evidence for these huge gains? In this article, they’re said to be demonstrated by Finland’s strong growth before the recent crisis. But is it plausible to give credit for the Nokia boom to the single currency?

Well, the chart shows a comparison I find interesting, between Finland and its neighbor Sweden, where a referendum in 2003 rejected euro membership. (I remember that vote: Swedish friends who shared my worries about the euro phoned me in the middle of the night to celebrate.) For both countries I use 1989 as a baseline; that was the year before the great Scandinavian slump of the 1990s, brought on by runaway banks and a huge housing bubble.




After that slump, Finland experienced a long stretch of solid economic growth. But so did Sweden, and it’s hard to see any real difference in their degrees of success. There’s certainly nothing there to indicate that euro membership was crucial to growth. Since 2008, on the other hand, Sweden has – despite bobbling its monetary policy – done much better.

As I said, maybe there are good arguments against the proposition that the euro was a mistake. But pointing out that politics matters, and economies grow, doesn’t cut it; these aren’t the factoids you’re looking for.

krugman

[Lark]

o outro artigo que o krugman refere acima.. debate in real time baby

Finland Shows Why Many Europeans Think Americans Are Wrong About the Euro
JULY 20, 2015


ESPOO, Finland — Finland is, in many ways, the anti-Greece.

Like Greece, it is geographically far from the core Western European powers of Britain, France and Germany. And like Greece, it uses the euro currency. But unlike Greece, it is a model of sound governance and responsible use of debt.

Yet Finland’s economy is also not doing so great, with an 11.8 percent unemployment rate and with contracting G.D.P. in each of the last three years.

A number of American commentators have looked at Finland’s current economic troubles as a clear sign that what ails the eurozone is far deeper than profligate spending by the Greeks. Paul Krugman has made that case at The New York Times, Tim Worstall at Forbes and Matt O’Brien at The Washington Post.


Alexander Stubb, the Finnish finance minister, thinks they’re wrong. I brought this up with him Sunday at a waterside restaurant in Espoo, the Helsinki suburb where he lives. His comments — a vigorous defense of what the euro has done for Finland — help explain why elite opinion about the euro is so different on the two sides of the Atlantic.

There are three main causes of Finland’s economic weakness. Nokia has gone from the world’s largest mobile phone maker to an afterthought, costing thousands of Finnish jobs and many more when its supply network is counted. Demand for paper, another major export, has fallen. And the economy of neighboring Russia, with which Finland has deep trade ties, has collapsed because of plummeting oil prices and Western sanctions.

Because Finland has used the euro since its inception, the value of its currency cannot adjust in ways that would cushion the overall Finnish economy from those shocks. If Finland still had its old currency, the markka, it would have fallen in value on international markets. Suddenly other Finnish industries would have had a huge cost advantage over, say, German competitors, and they would have grown and created the jobs to help make up for those lost because of Nokia and the paper industry and Russian trade.

“Rubbish,” Mr. Stubb said. To evaluate the euro, you can’t just look at what he calls a current “rough patch” for the Finnish economy. You have to look at a longer time horizon. In his telling, the integration with Western Europe — of which the euro currency is a crucial element — deepened trade and diplomatic relations, making Finland both more powerful on the world stage and its industries better connected to the rest of the global economy. That made its people richer.

“In the early 1990s in the middle of a Finnish banking crisis and economic depression, we were a top 30 country in the world in per capita G.D.P.,” he said. “Then we opened up; we became members of the E.U. Now we’re always up there in G.D.P. per capita or whatever other measure you look at with Sweden, Denmark, Australia and Canada.”

As to whether the ability to devalue its currency would help deal with the current economic downturn, Mr. Stubb is similarly skeptical. “Devaluation is a little like doping in sports,” he said. “It gives you perhaps a short-term boost, but in the long run, it’s not beneficial. Just like anyone else, we need structural reform, structural adjustment; we need to increase our competitiveness, and a little bit of luck.”

How the Finns Fared With the Euro: em anexo

Looking at the numbers, does Mr. Stubb have a point? It really is the case that Finland was an astounding success story from the time it joined the euro to the onset of the global financial crisis. Its inflation-adjusted per-capita G.D.P. rose 33 percent from 1998 to 2008, compared with 17 percent in both Germany and the United States.

It is also the case that the last several years have been harder on Finland than on other advanced economies, with real per-capita G.D.P. having fallen 8 percent from 2008 to 2014 (Germany is up 5 percent; the United States is up 4 percent).

So just as the Finland story from 1998 to 2008 is something wonderful to behold, it has also underperformed other advanced economies badly since the crisis. Being locked in a currency with larger and economically stronger Germany probably is an important part of the reason.

Of course, correlation is not causation. Maybe the Finnish economy did so well from 1998 to 2008 not because of the euro and broader European integration, but because it was a well-governed nation with industrious workers that was poised to rise to the top of the league tables of global income regardless. This is in the realm of things that are hard to prove in any definitive way, but the case that the euro was crucial isn’t without merit.

At the same time, you can see in the debate over the Finnish economy a broader divide between the American thinking about economics and how European leaders process their continent’s economic woes.

The Europeans are thinking about the long run, and what the euro and the broader integration it symbolizes will do for Europe’s potential. Many of us who write about economics every day are looking at the cyclical ups and downs, and want to see policies that are effective at smoothing them out.

The euro has not shown itself to be very good at helping the economies that use it stay on an even keel. Whether it has been good at driving long-term growth is a more subjective judgment. The answer may depend on whether the vantage point is an office in Washington or New York, or a waterside restaurant in Espoo.

nyt

[Lark]

The M.I.T. Gang
JULY 24, 2015

Goodbye, Chicago boys. Hello, M.I.T. gang.

If you don’t know what I’m talking about, the term “Chicago boys” was originally used to refer to Latin American economists, trained at the University of Chicago, who took radical free-market ideology back to their home countries. The influence of these economists was part of a broader phenomenon: The 1970s and 1980s were an era of ascendancy for laissez-faire economic ideas and the Chicago school, which promoted those ideas.

But that was a long time ago. Now a different school is in the ascendant, and deservedly so.

It’s actually surprising how little media attention has been given to the dominance of M.I.T.-trained economists in policy positions and policy discourse. But it’s quite remarkable. Ben Bernanke has an M.I.T. Ph.D.; so do Mario Draghi, the president of the European Central Bank, and Olivier Blanchard, the enormously influential chief economist of the International Monetary Fund. Mr. Blanchard is retiring, but his replacement, Maurice Obstfeld, is another M.I.T. guy — and another student of Stanley Fischer, who taught at M.I.T. for many years and is now the Fed’s vice chairman.

These are just the most prominent examples. M.I.T.-trained economists, especially Ph.D.s from the 1970s, play an outsized role at policy institutions and in policy discussion across the Western world. And yes, I’m part of the same gang.

So what distinguishes M.I.T. economics, and why does it matter? To answer that question, you need to go back to the 1970s, when all the people I’ve just named went to graduate school.

At the time, the big issue was the combination of high unemployment with high inflation. The coming of stagflation was a big win for Milton Friedman, who had predicted exactly that outcome if the government tried to keep unemployment too low for too long; it was widely seen, rightly or (mostly) wrongly, as proof that markets get it right and the government should just stay out of the way.

Or to put it another way, many economists responded to stagflation by turning their backs on Keynesian economics and its call for government action to fight recessions.

At M.I.T., however, Keynes never went away. To be sure, stagflation showed that there were limits to what policy can do. But students continued to learn about the imperfections of markets and the role that monetary and fiscal policy can play in boosting a depressed economy.

And the M.I.T. students of the 1970s enlarged on those insights in their later work. Mr. Blanchard, for example, showed how small deviations from perfect rationality can have large economic consequences; Mr. Obstfeld showed that currency markets can sometimes experience self-fulfilling panic.

This open-minded, pragmatic approach was overwhelmingly vindicated after crisis struck in 2008. Chicago-school types warned incessantly that responding to the crisis by printing money and running deficits would lead to 70s-type stagflation, with soaring inflation and interest rates. But M.I.T. types predicted, correctly, that inflation and interest rates would stay low in a depressed economy, and that attempts to slash deficits too soon would deepen the slump.

The truth, although nobody will believe it, is that the economic analysis some of us learned at M.I.T. way back when has worked very, very well for the past seven years.


True, there have been some important monetary successes. The Fed, led by Mr. Bernanke, ignored right-wing pressure and threats — Rick Perry, as governor of Texas, went so far as to accuse him of treason — and pursued an aggressively expansionary policy that helped limit the damage from the financial crisis. In Europe, Mr. Draghi’s activism has been crucial to calming financial markets, probably saving the euro from collapse.

On other fronts, however, the M.I.T. gang’s good advice has been ignored. The I.M.F.’s research department, under Mr. Blanchard’s leadership, has done authoritative work on the effects of fiscal policy, demonstrating beyond any reasonable doubt that slashing spending in a depressed economy is a terrible mistake, and that attempts to reduce high levels of debt via austerity are self-defeating. But European politicians have slashed spending and demanded crippling austerity from debtors anyway.

Meanwhile, in the United States, Republicans have responded to the utter failure of free-market orthodoxy and the remarkably successful predictions of much-hated Keynesians by digging in even deeper, determined to learn nothing from experience.

In other words, being right isn’t necessarily enough to change the world. But it’s still better to be right than to be wrong, and M.I.T.-style economics, with its pragmatic openness to evidence, has been very right indeed.

nyt/krugman

[tommy]

Um auto-elogio que acrescenta zero à humanidade e ainda por cima é falso por já ter sido demonstrado como está errado ou como tenta adulterar gráficos e escolher datas especiais só para encaixar no argumento.

Enfim começa a parecer aqueles ditadores comunistas. A retórica é a mesma.

‘Unpredictable, Irrational’
The Putin era in Russia is drawing to a close, Khodorkovsky said on his website on Thursday. The former KGB agent is “unpredictable, irrational and living in a different reality,” Khodorkovsky said.
Authorities are preemptively pressuring both Golos, or Voice, and Open Russia.
Mikhail Khodorkovsky, the only billionaire jailed by Vladimir Putin, is assembling an army of volunteers to challenge the electoral system that supports his nemesis
Mikhail Khodorkovsky, the only billionaire jailed by Vladimir Putin, is assembling an army of volunteers to challenge the electoral system that supports his nemesis Dmitry Beliakov/Bloomberg
Police this month searched Golos’s headquarters and the homes of four of its leaders as part of a tax case the group says is trumped up. In April, officials raided Open Russia’s Moscow office for allegedly preparing materials urging extremist activity, which the foundation denies.
Putin’s United Russia received 49.3 percent of the vote in the legislative elections in 2011, down from 64.3 percent in 2007 but just enough to retain its majority in the 450-seat State Duma. The party’s approval rating has since slipped to 47 percent, while Putin’s is hovering near a record at 87 percent, polls by the independent Levada Center show.

Realidade?
Draghi cometeu um erro terrível que vamos pagar caro em aumentar a exposição aos caloteiros em 90bi;
Blanchard é chefe na instituição que exige austeridade - muito pior da realizada em Portugal por exemplo - por todos os países que estão falidos;
Bernanke sem as reformas - REFORMAS - do obama, teria sido miseravelmente sucedido. Mais há quem defenda que até teria sido melhor injectar dinheiro de outra forma na economia...veremos mais à frente. REFORMAS.
krugman errou no UK, errou na grecia, errou no tsipras, adulterou gráficos, escolhe datas à medida dos seus argumentos. enfim não tem credibilidade, vale zero. exemplo da esquerda caviar ao defender o caminho da luz que nos livra de crises com zero sacrificios, mas que nunca ninguém fez ou sabe fazer. Só ele. Nem consegue dar um exemplo de imprimir moeda, sem reformas duras, que tenha dado resultado. ZERO. A venezuela deu-lhe ouvidos, agora está a roubar aos agricultores para o povo não se revoltar antes das eleições.

krugman = ridículo.

[tommy]

http://observador.pt/opiniao/os-enganados/

A esquerda nunca erra. Desilude-se. Nunca se engana. É enganada. Mesmo quando confrontada com os resultados mais catastróficos, o máximo que se lhes ouve é um desalentado "Foi um sonho que acabou mal"


Já todos passámos por aquele penoso momento em que nos interrogámos se vale ou não a pena dizer a alguém que se está a enganar a si mesmo e que era melhor parar de fazer de conta que está tudo bem. Pior, qualquer ser humano desde que saiu do colo da mãe já passou por aquele cruel instante em que se confrontou a si mesmo com o facto não só de ter sido enganado mas também de ter querido enganar-se.

Até aqui nada de novo: errar é humano e querer persistir no erro também. Daqui para a frente é que a humanidade diverge: de um lado estão aqueles que assumem os seus erros e do outro aqueles que. saltando por cima dos seus erros, invariavelmente culpam os outros por os terem enganado.

Eles nunca erram, as suas intenções são sempre as melhores. Os outros é que os enganam. O desenrolar dos acontecimentos na Grécia tem levado a que muitos daqueles que em Janeiro faziam declarações ditirâmbicas com a vitória da esquerda radical na Grécia agora procurem apagar esse mau momento. Como? Reflectindo sobre o seu erro? Tirando conclusões? Nada disso. Simplesmente culpam o mesmo Syriza e o mesmo governo grego que há meses incensavam. Quem declarou que “A estratégia do Syriza foi perdedora desde o início” ou que “Governo grego foi de uma enorme imprudência” foram respectivamente os mesmos Ricardo Paes Mamede e António Costa que antes declaravam “Syriza já conseguiu mais do que qualquer Governo bem comportado na Europa” e “Vitória do Syriza é um sinal de mudança que dá força para seguir a mesma linha”.

Deixando para outra oportunidade o destrinçar da confusão entre a táctica e a estratégia que levou o líder do PS e boa parte desse partido a achar que desgastavam o governo português congratulando-se com a derrota estrondosa do partido socialista grego e colando-se a uma vitória da esquerda radical, há aqui uma auto-indulgência que já cansa. A esquerda nunca erra. Desilude-se. Nunca se engana. É enganada. Mesmo quando confrontada com os resultados mais catastróficos, o máximo que se lhes ouve é um desalentado “Foi um sonho que acabou mal.”O facto de muitos dos movimentos de esquerda e, no caso particular de Portugal, o PS acolherem, quais bíblicos filhos pródigos, todos os provenientes da esquerda radical afecta ao PCP acentua esta auto-indulgência. É espantoso como gente culta, viajada e informada declara, quando confrontada com as atrocidades do comunismo que apoiou, que as desconhecia ou mais perturbantemente ainda que o partido, entendendo aqui por partido o PCP, as enganava. Na verdade eles quiseram enganar-se. Não foram os únicos mas em geral os outros admitem que foram eles mesmos que se quiseram enganar. E assim o viver de enganos que devia ser um factor de reflexão, torna-se numa circunstância que poetiza aquele que a invoca.

A direita erra igualmente mas felizmente não lhe é permitido o discurso do sonho que acabou em desengano, da ilusão que se desfez, da utopia que não foi. É erro. É crime. É disparate. E ponto final. E esta pequena enorme diferença face ao erro explica muita coisa. Explica por exemplo que à esquerda o anunciado seja sempre mais importante que os resultados. Explica também que, por essas bandas, aqueles que se tinham como exemplo ontem se tornem inconvenientes dias depois sem que ninguém estranhe tal transfiguração. E sobretudo torna social e mediaticamente aceitável a quase candura com que pessoas alinhadas nessa espécie de reiki da política que dá pelo nome de progressismo dão conta da sua irresponsabilidade.

Neste campo o caso mais óbvio na crise grega é o de Paul Krugman que em Janeiro escrevia “O problema com os planos do Syriza poderá ser que não sejam suficientemente radicais” ou “O resto da Europa deveria dar uma oportunidade [a Tsipras] para acabar com o pesadelo do país” e que agora declara surpreendido, como quem olha para o ar pesado da cor que escolheu para as paredes da sala, com a presente crise grega: “Talvez tenha sobrestimado a competência do Governo grego”. Mais espantosamente ainda o Nobel da Economia confessa “Não calculei que pudessem tomar uma posição sem ter um plano de urgência”. Não só é espantoso que Krugman não tenha calculado que esse plano não existia como que não tenha percebido que a existir um plano desses iria fazer da Grécia um estado pária sob tutela da China, da Rússia ou do Irão. Como a Rússia não tem dinheiro, a China tem mais com que se preocupar e o Irão anda atarefado a negociar o fim das suas próprias sanções, nenhum desses países se mostrou interessado em arranjar (mais) problemas com a UE, para mais por causa da pouco confiável Grécia. Logo, o plano B, com prisão do governador do banco central grego incluído (já agora o que ia acontecer à liberdade de imprensa?) ficou (por enquanto) na gaveta.

Há anos que isto é assim: as almas progressistas do ocidente apoiam os mais diversos radicalismos por esse mundo fora (perturbante mas profundamente verdadeira a descrição efectuada por Gabriel Mithá Ribeiro do papel desempenhado pelos brancos portugueses”revolucionários” na perseguição aos brancos portugueses”colonialistas” e na destruição da economia e da sociedade, no caso em Moçambique mas que foi comum a outros países africanos). Depois, quando os resultados do desastre se mostram óbvios eles dizem-se surpreendidos. Declaram que foi uma falsa boa ideia. Que nunca tinham pensado que ia ser assim. Ou, pior, que a sua utopia sempre generosa não é compatível com a espécie humana invariavelmente egoísta, ressalvada a tribo ou o povo que nesse momento os faz crer que agora é que vai ser. Nunca é mas isso para eles não interessa nada.

PS. Desde já manifesto o meu absoluto apoio à reivindicação de Heloísa Apolónia de nos debates televisivos ter um tratamento equiparado ao dos outros líderes, nomeadamente Paulo Portas. Eu sei que já escrevi que os Verdes nunca foram a votos e que, como tal, não podem ser considerados um partido no verdadeiro sentido dos termos. Nada disso me interessa agora e volto já com a palavra atrás. Desde que a equidade no tratamento aos Verdes leve a que seja agendado um debate Heloísa Apolónia versus Jerónimo de Sousa. Não sei aliás como vou conter a impaciência até que chegue esse momento. Desde o frente a frente Soares-Cunhal em 1975 que o País não vê nada de tão esclarecedor!

[Lark]

Paul Krugman - New York Times Blog

Second-best Macroeconomics
JULY 28, 2015 2:51 PM July 28, 2015 2:51 pm

There’s a paradox about economic policy since the Great Recession, one that is often acknowledged implicitly but rarely stated directly. On one side, the economic problems facing both the United States and Europe have been quite straightforward and comprehensible. On the other side, the debate over actual policy has been tortured and confused, with a general sense even among aficionados that the tools being deployed are inadequate and come with troubling side effects.

Specifically, the whole western world has spent years suffering from a severe shortfall of aggregate demand; in Europe a severe misalignment of national costs and prices has been overlaid on this aggregate problem. These aren’t hard problems to diagnose, and simple macroeconomic models — which have worked very well, although nobody believes it — tell us how to solve them. Conventional monetary policy is unavailable thanks to the zero lower bound, but fiscal policy is still on tap, as is the possibility of raising the inflation target. As for misaligned costs, that’s where exchange rate adjustments come in. So no worries: just hit the big macroeconomic That Was Easy button, and soon the troubles will be over.

Except that all the natural answers to our problems have been ruled out politically. Austerians not only block the use of fiscal policy, they drive it in the wrong direction; a rise in the inflation target is impossible given both central-banker prejudices and the power of the goldbug right. Exchange rate adjustment is blocked by the disappearance of European national currencies, plus extreme fear over technical difficulties in reintroducing them.

As a result, we’re stuck with highly problematic second-best policies like quantitative easing and internal devaluation.

In case you don’t know, “second best” is an economic term of art. It comes from a classic 1956 paper by Lipsey and Lancaster, which showed that policies which might seem to distort markets may nonetheless help the economy if markets are already distorted by other factors. For example, suppose that a developing country’s poorly functioning capital markets are failing to channel savings into manufacturing, even though it’s a highly profitable sector. Then tariffs that protect manufacturing from foreign competition, raise profits, and therefore make more investment possible can improve economic welfare.

The problems with second best as a policy rationale are familiar. For one thing, it’s always better to address existing distortions directly, if you can — second best policies generally have undesirable side effects (e.g., protecting manufacturing from foreign competition discourages consumption of industrial goods, may reduce effective domestic competition, and so on). There’s also a political economy concern, which is that in a complicated world you can come up with a second best rationale for practically anything. Somewhere the Chicago economist Harry Johnson wrote (this is from memory) that in practice “second best policies are always devised by third-best economists working for fourth-best politicians” — harsh, but you can see his point.

But here we are, with anything resembling first-best macroeconomic policy ruled out by political prejudice, and the distortions we’re trying to correct are huge — one global depression can ruin your whole day. So we have quantitative easing, which is of uncertain effectiveness, probably distorts financial markets at least a bit, and gets trashed all the time by people stressing its real or presumed faults; someone like me is then put in the position of having to defend a policy I would never have chosen if there seemed to be a viable alternative.

In a deep sense, I think the same thing is involved in trying to come up with less terrible policies in the euro area. The deal that Greece and its creditors should have reached — large-scale debt relief, primary surpluses kept small and not ramped up over time — is a far cry from what Greece should and probably would have done if it still had the drachma: big devaluation now. The only way to defend the kind of thing that was actually on the table was as the least-worst option given that the right response was ruled out.

Which makes me ask myself the question: Do people like me spend too much time being limited by what is presumed to be politically practical? Should we devote more time to trying to widen the range of options, to pointing out that we really would be much better off if we threw off the fetters of conventional deficit fears, the 2 percent inflation target, and the extremely ill-advised euro project?

nyt/krugman

[Lark]

The automation myth

Robots aren't taking your jobs— and that's the problem
by Matthew Yglesias on July 27, 2015

Over the past five years, American politics has become obsessed with robots.

President Obama has warned that ATMs and airport check-in kiosks are contributing to high unemployment. Sen. Marco Rubio said that the central challenge of our times is "to ensure that the rise of the machines is not the fall of the worker." A cover story in the Atlantic asked us to ponder the problems of a world without work. And in the New York Times, Barbara Ehrenrich warns that "the job-eating maw of technology now threatens even the nimblest and most expensively educated."

The good news is that these concerns are wrong. None of the recent problems in the American economy are due to robots — or, to be more specific about it, due to an accelerating pace of automation. Moreover, even if the pace of automation does speed up in the future, there's no real reason to believe that it will be a problem.

The bad news is that these concerns are wrong. Rather than an accelerating pace of automation, we've actually been living through a slowdown in the pace of productivity growth. And that slowdown is a huge problem. Unless it reverses, we'll be waking up soon to find ourselves in a depressing world of longer working years, unmanageable health-care needs, higher taxes, and a public sector starved of needed infrastructure resources.

In other words, don't worry that the robots will take your job. Be terrified that they won't.

The past of automation

When people hear about robots, they think of science fiction — the Johnny Cab taxi from Total Recall, chrome maid Rosie from The Jetsons, or the thinking, talking computer that powers the starship Enterprise. All this and more may come to pass some day (who knows?) but the reality of day-to-day change is more mundane.

 
Machines have been replacing humans for hundreds of years. And when it happens to you, it stinks. It stank for small business owners whose photo development shops were driven out of business by digital cameras. It stank for analog graphic designers like my mother who were disemployed by desktop publishing software in the late 1980s. It stank for stevedores who were put out of work by container ships. It stank for weavers put out of work by the spinning jenny. It stank for railroad engineers put out of work by the automobile.

But for society as a whole, these were huge leaps forward. Specific individuals did in fact lose jobs and oftentimes ended up with lower wages. But on average, job growth continued and living standards rose.

The techno-pessimists often admit this. The problem, they say, is if technology reduces the need for human labor really, really fast, then society won't have time to adjust, and there will be broad unemployment.

Well, again, we can look to the past. Despite the cliché that technology today is progressing faster than ever, the per-worker output of the American economy actually increased at its fastest-ever rate in the quarter century between 1948 and 1973.

This is the period in which the spread of refrigerators put milkmen out of work, while the initial adoption of machines to wash clothing and dishes rendered full-time household servants superfluous for the middle class. This was a time when television displaced live theater, and when truck-based delivery upended product distribution networks and rendered many neighborhood retailers obsolete. New interstates bypassed old towns and rail depots. Automatic telephone switches put operators out of work. New fertilizer products derived from wartime research increased per-acre crop yields and reduced the number of laborers needed.

So what happened?


Well, people worked less. In 1950 (the first year for which we have records), the average employed person in the United States worked about 1,909 hours. By 1973, that had fallen to 1,797 hours. That's a decline of about 6 percent. It's the equivalent of going from having two weeks of paid vacation per year to having five weeks. Or of going from working 9 to 5 every day to working 9:30 to 5 every day.

But there was no overall collapse in employment. The total number of employed people grew by more than 50 percent during this period, keeping up with population growth. Wages rose steadily at a pace of about 2.23 percentage points faster than inflation in the average year.

 
And the growth was widely shared. There were rich people and poor people, of course, but the share of overall national income accruing to the very wealthy was modest and generally falling. The fast pace of automation did not mean the only people who could get ahead were those clever enough to invent the new machines or lucky enough to earn them. Individual people lost out at particular moments in time, but on average, the tide rose rapidly and lifted the vast majority of the boats.

The big slowdown

Today it appears to most people that we are living in a period of immense technological change. A rather small device that I carry in my pocket replaces the telephone that used to sit in my bedroom, the Walkman in my pocket, the TI-85 calculator in my backpack, every single book I've ever owned, the Sega Genesis on the shelf, the alarm clock on my bedside table, and even, to some extent, my television. And yet it doesn't only replicate the functions of those devices. In most cases it far surpasses them.

But despite the techno-hype and the national obsession with disruption, the pace of productivity growth has slowed down. The American economy has grown, but largely by adding workers rather than by workers equipping themselves with powerful new machines to multiply their capabilities. And the number of hours worked per worker has stayed relatively flat, even while other countries have continued to enhance their leisure.

If robots were taking our jobs, the productivity of the workers who still have jobs — the total amount of work that gets done divided by the total number of people who are employed — would be going up rapidly. But it's not. It is rising, but it's rising slower than it did in the past.

And the slowing rate of productivity growth is an important source of the wage slowdown that people have been worrying about.

The 2015 Economic Report of the President calculated that if productivity growth had continued at its 1948–1973 pace for the past 40 years, the average household's income would be $30,000 higher today. By contrast, had inequality stayed at its 1973 level for the same period, Obama's Council of Economic Advisers calculates that the average household's income would be only $9,000 higher.

The productivity issue is bigger than inequality, in other words. And yet it's much less discussed.

In fact, it's almost anti-discussed due to the obsession in media and political circles with the alleged rise of the robots. We're so busy worrying about how to counteract an imaginary, robot-driven productivity surge that we're barely paying attention to the real story of the productivity slowdown.

The Solow Paradox

But what about the bounty of digital technology that is in evidence all around us? Almost 30 years ago, the great economist Robert Solow quipped, "You can see the computer age everywhere but in the productivity statistics."

An answer to the riddle might be that digital technology has transformed a handful of industries in the media/entertainment space that occupy a mindshare that's out of proportion to their overall economic importance. The robots aren't taking our jobs; they're taking our leisure.

Data from the American Time Use Survey, for example, suggests that on average Americans spend about 23 percent of their waking hours watching television, reading, or gaming. With Netflix, HDTV, Kindles, iPads, and all the rest, these are certainly activities that look drastically different in 2015 than they did in 1995 and can easily create the impression that life has been revolutionized by digital technology.

What's more, the media industry itself has been turned upside down by the internet and has spent the last decade telling anyone who will listen how complete and wrenching the transformation has been. That further amplifies a narrative about rapid change.

But clearly the media and entertainment industries don't comprise anything close to 23 percent of the workforce or the total economic output of the United States. Most other job categories have been impacted by digital technology, but only in relatively superficial ways. Something like 9 percent of all private sector jobs are in the food service industry. These days people are perhaps more likely to book a reservation or order a takeout meal with an app rather than a phone call, but the core work of serving and preparing food has seen very little progress.

At the higher end of the salary spectrum, we still don't have robot doctors who can treat patients in lieu of costly and inconvenient human ones. Indeed, we can't even get medical records digitized properly.

As it becomes clearer and clearer over time that smartphones and the internet simply aren't economic game changers on the same scale as air conditioning, jet planes, container ships, and televisions, it's become increasingly fashionable in Silicon Valley to simply retreat into denial.

"There is a lack of appreciation for what’s happening in Silicon Valley," Google's chief economist, Hal Varian, told the Wall Street Journal, "because we don’t have a good way to measure it."

The article states that Varian believes a "problem with the government’s productivity measure" is that "it is based on gross domestic product, the tally of goods and services produced by the U.S. economy."

But this is not a measurement error. This is the definition of economic productivity. When people can create more goods and services for sale in the market economy, their productivity goes up. When they cannot, it does not. It is obviously true that there are things in life that matter that are not monetized in this way. I, personally, derive enormous pleasure from daily jokes on Twitter. That said, Silicon Valley hardly invented the idea that the best things in life are free. The joy that my infant son's smile brings to my face isn't in the GDP numbers either. Nor is the sadness I feel when reflecting on the fact that my late mother didn't live to meet him.

But if you want to put a roof over your baby's head, to keep him in diapers and formula, and to buy some plane tickets so he can go with you to visit his grandparents, then you are going to need some money. And money derives from monetized economic activity.

It's getting worse

The productivity slowdown began decades ago and initially corresponded with bad news from abroad about oil prices. It persisted through a sharp recession that broke the back of inflation, and continued through the Reagan recovery. In the mid- to late 1990s things briefly turned around, and it momentarily looked like the Solow Paradox was gone. Walmart and other big-box stores learned to use computers to better control their inventories and greatly improved the productivity of the retail sector.

As is typical with periods of rapid technological change, this led to some displacement and suffering and heartburn. But even though the late '90s were a terrible time to be the owner of a mom-and-pop hardware store, on average it was a period of low unemployment and rising wages.

But as Paul Krugman has written, "We did not, it turned out, get a sustained return to rapid economic progress. Instead, it was more of a one-time spurt, which sputtered out around a decade ago."

In the most recent years, it's actually gotten worse than ever.

This extreme slowdown has coincided with a period of weak demand, high unemployment, and agonizingly slow wage growth. That all adds up to an environment in which managers have little budget to invest in new equipment due to weak sales, and little incentive to give raises due to poor worker bargaining power.

Rather than hot business trends relating to new equipment that allows workers to deliver more value than ever before, one of the signal trends of our time has been a proliferation of online services that reduce the friction associated with having people get in their car and bring you things. Washio, for example, will send someone to my house to pick up my dry cleaning. Seamless will ping a restaurant and tell it to deliver takeout to my door. Postmates will send someone to get a takeout dinner from a restaurant that doesn't offer delivery. Homejoy will send someone to clean my house. These startups are okay business ideas, but they are not doing anything to advance the efficiency with which clothing is laundered, meals are cooked, or houses are cleaned.

The main industry in which productivity is accelerating rapidly is the information technology industry itself. We are getting better and better at making smartphones, apps, cloud services, and all the rest. Those things just aren't driving change in the larger economy. Indeed, the way modern digital technology blurs the lines between entertainment devices and productivity devices in some ways works to undermine the productivity of the modern office worker. Email means you can stay in touch with remote colleagues, but it also means you can send a note to your dad during business hours. It's clear from the analytics at Vox.com and every other website that America's white-collar workforce is doing a lot of Facebook updates, tweeting, and casual web browsing during business hours. It's surely not a coincidence that 2015's hottest office productivity tool is a group chat service called Slack.

This may make life more pleasant in some respects (and annoying in others, as family dinners are now interrupted by random work emails), but it adds up to a remarkably modest impact on the overall health of the economy.

The less-work future

Of course, all this might change. The power of Moore's Law — which states that the power of computer chips doubles roughly every two years — is such that the next five years' worth of digital progress will involve bigger leaps in raw processor power than the previous five years. It's at least possible that we really will have a massive leap forward in productivity someday soon that starts substantially reducing the amount of human labor needed to drive the economy forward.

But robots are never going to take all the jobs. The problem with trying to envision "a world without work" is that it asks us to envision an unrealistically large change.

The more likely outcome is a world with less work. And that's a world we should welcome rather than fear. It's a world in which we can make some policy decisions we want to make, rather than decisions we really don't want to make.

The "normal" Social Security retirement age in the United States used to be 65. Currently it is moving up to 67. Many prominent politicians, from Jeb Bush and Christ Christie to the bipartisan Simpson-Bowles commission on deficit reduction, say that to keep the system solvent we need to move it up even further, to 70. In a world of more productivity and less work, instead of doing that, we might move it back down to 65. Or maybe even cut it back to 62.

Some more ideas:

Right now the average American gets 10 paid vacation days and six paid holidays.
We could emulate Germany, where 20 and 10 are the current minimum. Or go really nuts and copy Austria, where it's 22 and 13.
We could reduce the high school and college dropout rates, and slightly increase the number of college graduates who go on to some form of graduate school.
We could emulate Sweden's 480 days of paid leave for new parents.
We could give college students more generous grants so more of them could focus full-time on their studies rather than dual-tracking school with work.
Right now, 44 percent of mothers with full-time jobs say they would rather work part time. We could make that happen.

These are just illustrative ideas, of course, not a comprehensive program. But they go to show that given decent public policy, an automation-driven productivity surge is nothing to be afraid of. For any given item on that list, the natural objection will be that "we can't afford it." If productivity accelerated, we could easily afford it — and more — reducing the total amount of human toil while still maintaining the basic life-cycle concept of a career.

If the robots don't arrive

The real threat is precisely the opposite — that the per-hour productivity of the American worker won't increase at a more rapid rate.

If you've ever heard a dreary lecture about the "entitlement crisis," that is the world they are talking about. The American population is aging and is projected to continue aging. In other words, the ratio of working-age people to retired people is falling. That means that we will have to either reduce the living standards of the elderly by cutting their benefits, or reduce the living standards of the non-elderly by raising their taxes or cutting spending on programs they depend on.

By the same token, the proposition that "health-care costs" will bury the country is essentially the proposition that technology won't dramatically increase the productivity of the health-care sector. That means, again, some combination of reduced benefits for the sick and higher premiums and taxes for the healthy.

Most likely, we'll keep doing a little bit of both.

Unless, that is, some robots come along to help us out.

vox

infelizmente, mais uma coisa que vai contra o que era a minha percepção. o infelizmente não é ir contra a minha percepção. é a coisa em si. : (

[Lark]

sobre o tribalismo político,
é oportuno porque acontece exactamente o mesmo por aqui.

Paul Krugman - New York Times Blog

Inflation Paranoia as a Tribal Marker

Derp — views that just keep being repeated in the face of overwhelming contrary evidence — has always been with us, but the derp quotient has really soared since the crisis of 2008, which made nonsense of doctrines too dearly held to be reconsidered. This is especially true of inflation derp: has any prominent figure who warned of runaway inflation from the Fed’s efforts admitted having learned anything from being wrong year after year?

It seems increasingly clear to me that what we’re looking at here has nothing to do with intellectual discourse as we normally understand it. It is, instead, about tribal identities: there’s a certain kind of person who rails against policies that debase the dollar, and that kind of person admires others who do the same no matter how wrong their predictions and disastrous their financial advice. As I said in a brief note on Ron Paul, it’s a form of Madoff-style affinity fraud, even if the perpetrator of the scam believes his own derp.

As you might guess, I’ve received some mail from Ron Paul admirers deeply angered by the suggestion that they are not engaged in deep intellectual argument. By and large the mail reads like this:

Dear shmak, Paul Krugman!
Stop insulting Ron Paul!
You are low level Socialist/Liberal who should be jailed for Life
your insulting writing style.
Ron Paul is Real Man with Capital M
and you are nobody!

But the thing is, it’s not just the libertarians who do this sort of thing. Awesomely, Richard Fisher, now retiring as president of the Dallas Fed, is apparently regarded as an intellectual giant — he “rose to the status of being a deity in Texas” — despite a track record of being wrong again and again.

A brief aside: the WSJ engages in a fairly common practice when describing inflationistas, namely that of whitewashing what they have actually spent year after year warning against. No, Fisher didn’t warn against “frothy financial markets”. He warned against inflation — inflation that kept not happening.

Why all the respect for what would ordinarily be considered a record of repeated bad judgment coupled with a lamentable unwillingness to learn from experience? The answer, surely, is that within the conservative tribe issuing dire warnings against inflation is considered virtuous whether or not they are right; it’s a way of showing that you’re their kind of guy, that you belong to the tribe.

Of course, saying things like that means that I should be jailed for life.

krugman

[Lark]

o artigo a que o krugman se refere no post acima

The Old Man and the CPI
JULY 25, 2015 9:02 AM July 25, 2015 9:02 am

I don’t watch financial news, but CNBC was on in the gym, so I was treated to a long ad from Ron Paul, who wants you to buy his video explaining the coming crisis brought on by loose money. And I found myself thinking about the remarkable fact that there really are people who will buy that video.

After all, Ron Paul has been making the same prediction year after year — in fact, he’s been making this prediction at least since 1981! — and has been wrong year after year. It’s hard to think of a doctrine that has been as thoroughly refuted by events as goldbug economics. For a while gold prices did go up, although not for the reasons the goldbugs thought, but now even that has gone into reverse. So why would anyone pay money for this guy’s analysis?

Of course, we know why: it’s the Bernie Madoff effect, a.k.a. affinity fraud. People believed Madoff because he was their kind of guy, never mind the implausibility of his claims; they believe Ron Paul for the same reason. True, there’s no reason to suppose that Paul is deliberately misleading his market – he probably believes his own nonsense. But in terms of the underlying dynamics that makes no difference.

So who are the people who feel a deep affinity with a crotchety crank? Um, crotchety white guys feeling cranky. The whiteness is, I believe, an important part of the story, as I’ll explain in a minute.

The basic mindset of the kind of people who pay Ron Paul for his economic advice is pretty clear: they’ve made some money over the course of their lives, they believe that all of it reflects their own virtue, and they think they know from that experience what it takes to create wealth. They hear that the Fed is printing money, and it sounds to them like a violation of both the laws of economics and morality — and they surely think of it as a plot to take away their completely earned gains and give them to Those People (hence the whiteness issue).

You can try as hard as you like to tell such people that monetary policy is mainly a technical problem, that the Fed isn’t giving money away, and that predictions of runaway inflation have been utterly wrong; it will make no difference. You can point out that they would have done a much better job of investing if they had listened to the MIT gang; sorry, we’re just not their kind of people.

I’d say it’s sad, but I find it hard to feel much sympathy for the marks of this particular scam. Then again, that’s probably why they will never, ever listen to what I have to say.

krugman

[Lark]

China’s Naked Emperors
JULY 31, 2015

Politicians who preside over economic booms often develop delusions of competence. You can see this domestically: Jeb Bush imagines that he knows the secrets of economic growth because he happened to be governor when Florida was experiencing a giant housing bubble, and he had the good luck to leave office just before it burst. We’ve seen it in many countries: I still remember the omniscience and omnipotence ascribed to Japanese bureaucrats in the 1980s, before the long stagnation set in.

This is the context in which you need to understand the strange goings-on in China’s stock market. In and of itself, the price of Chinese equities shouldn’t matter all that much. But the authorities have chosen to put their credibility on the line by trying to control that market — and are in the process of demonstrating that, China’s remarkable success over the past 25 years notwithstanding, the nation’s rulers have no idea what they’re doing.

Start with the fundamentals. China is at the end of an era — the era of superfast growth, made possible in large part by a vast migration of underemployed peasants from the countryside to coastal cities. This reserve of surplus labor is now dwindling, which means that growth must slow.

But China’s economic structure is built around the presumption of very rapid growth. Enterprises, many of them state-owned, hoard their earnings rather than return them to the public, which has stunted family incomes; at the same time, individual savings are high, in part because the social safety net is weak, so families accumulate cash just in case. As a result, Chinese spending is lopsided, with very high rates of investment but a very low share of consumer demand in gross domestic product.

This structure was workable as long as torrid economic growth offered sufficient investment opportunities. But now investment is running into rapidly decreasing returns. The result is a nasty transition problem: What happens if investment drops off but consumption doesn’t rise fast enough to fill the gap?

What China needs are reforms that spread the purchasing power — and it has, to be fair, been making efforts in that direction. But by all accounts these efforts have fallen short. For example, it has introduced what is supposed to be a national health care system, but in practice many workers fall through the cracks.

Meanwhile, China’s leaders appear to be terrified — probably for political reasons — by the prospect of even a brief recession. So they’ve been pumping up demand by, in effect, force-feeding the system with credit, including fostering a stock market boom. Such measures can work for a while, and all might have been well if the big reforms were moving fast enough. But they aren’t, and the result is a bubble that wants to burst.

China’s response has been an all-out effort to prop up stock prices. Large shareholders have been blocked from selling; state-run institutions have been told to buy shares; many companies with falling prices have been allowed to suspend trading. These are things you might do for a couple of days to contain an obviously unjustified panic, but they’re being applied on a sustained basis to a market that is still far above its level not long ago.

In part, they may be worried about financial fallout. It seems that a number of players in China borrowed large sums with stocks as security, so that the market’s plunge could lead to defaults. This is especially troubling because China has a huge “shadow banking” sector that is essentially unregulated and could easily experience a wave of bank runs.

But it also looks as if the Chinese government, having encouraged citizens to buy stocks, now feels that it must defend stock prices to preserve its reputation. And what it’s ending up doing, of course, is shredding that reputation at record speed.

Indeed, every time you think the authorities have done everything possible to destroy their credibility, they top themselves. Lately state-run media have been assigning blame for the stock plunge to, you guessed it, a foreign conspiracy against China, which is even less plausible than you may think: China has long maintained controls that effectively shut foreigners out of its stock market, and it’s hard to sell off assets you were never allowed to own in the first place.

So what have we just learned? China’s incredible growth wasn’t a mirage, and its economy remains a productive powerhouse. The problems of transition to lower growth are obviously major, but we’ve known that for a while. The big news here isn’t about the Chinese economy; it’s about China’s leaders. Forget everything you’ve heard about their brilliance and foresightedness. Judging by their current flailing, they have no clue what they’re doing.

krugman

[Incognitus]

Politicians who preside over economic booms often develop delusions of competence. You can see this domestically: Jeb Bush imagines that he knows the secrets of economic growth because he happened to be governor when Florida was experiencing a giant housing bubble, and he had the good luck to leave office just before it burst. We’ve seen it in many countries: I still remember the omniscience and omnipotence ascribed to Japanese bureaucrats in the 1980s, before the long stagnation set in.

É curioso porque o Krugman fez um erro similar numa das suas análises, que aqui discutimos há um par de meses atrás.

Já agora, se o Jeb Bush entrasse agora teria uma boa probabilidade de ter um problema económico durante a sua presidência. A expansão actual já é historicamente longa (embora as expansões mais modernas sejam mais longas que as mais antigas).

[Lark]

Is there a doctor in the house? The global economy is failing to thrive, and its caretakers are fumbling. Greece took its medicine as instructed and was rewarded with an unemployment rate of 26 percent. Portugal obeyed the budget rules; its citizens are looking for jobs in Angola and Mozambique because there are so few at home. Germans are feeling anemic despite their massive trade surplus. In the U.S., the income of a median household adjusted for inflation is 3 percent lower than at the worst point of the 2007-09 recession, according to Sentier Research. Whatever medicine is being doled out isn’t working. Citigroup (C) Chief Economist Willem Buiter recently described the Bank of England’s policy as “an intellectual potpourri of factoids, partial theories, empirical regularities without firm theoretical foundations, hunches, intuitions, and half-developed insights.” And that, he said, is better than things countries are trying elsewhere.

There is a doctor in the house, and his prescriptions are more relevant than ever. True, he’s been dead since 1946. But even in the past tense, the British economist, investor, and civil servant John Maynard Keynes has more to teach us about how to save the global economy than an army of modern Ph.D.s equipped with models of dynamic stochastic general equilibrium. The symptoms of the Great Depression that he correctly diagnosed are back, though fortunately on a smaller scale: chronic unemployment, deflation, currency wars, and beggar-thy-neighbor economic policies.

An essential and enduring insight of Keynes is that what works for a single family in hard times will not work for the global economy. One family whose breadwinner loses a job can and should cut back on spending to make ends meet. But everyone can’t do it at once when there’s generalized weakness because one person’s spending is another’s income. The more people cut back spending to increase their savings, the more the people they used to pay are forced to cut back their own spending, and so on in a downward spiral known as the Paradox of Thrift. Income shrinks so fast that savings fall instead of rise. The result: mass unemployment.

Keynes said that when companies don’t want to invest and consumers don’t want to spend, government must break the dangerous cycle by stepping up its own spending or cutting taxes, either of which will put more money in people’s pockets. That is not, contrary to some of his critics, a recipe for ever-expanding government: Keynes said governments should run surpluses during boom times to pay off their debts and soak up excessive private demand. (The U.S. ran small surpluses in two boom years of the Clinton administration.) Far from a wild-eyed radical, he said economists should aspire to the humble competence of dentists. He wanted to repair economies, not overthrow them.

“There are still many people in America who regard depressions as acts of God. I think Keynes proved that the responsibility for these occurrences does not rest with Providence,” Bertrand Russell, the philosopher, wrote in his autobiography in 1969.

Enthusiasm for Keynes waxes and wanes. The last time the gawky Brit made a splash was 2008-09, during the global financial crisis. People who had borrowed extravagantly, using their houses as ATMs, turned overnight into financial Calvinists, cutting spending to pay down debt. Nervous chief executive officers simultaneously cut back on corporate investing. That led to a lack of demand for goods and services. Unemployment shot up, reaching 10 percent in the U.S. in 2009. Even conservative economists who generally eschewed Keynes knew a Paradox of Thrift when it punched them in the nose. “When things collapse, everybody becomes a Keynesian,” says Peter Temin, a professor emeritus of economics at Massachusetts Institute of Technology and co-author with University of Oxford economist David Vines of a new book, Keynes: Useful Economics for the World Economy.

Richard Posner, the free-market federal appellate judge, wrote a 2009 article for the New Republic titled “How I Became a Keynesian.” Harvard University economist Martin Feldstein, a longtime deficit hawk who was President Reagan’s chief economic adviser, wrote an op-ed in the Washington Post in October 2008 saying, “The only way to prevent a deepening recession will be a temporary program of increased government spending.” The following February, Congress passed a $787 billion stimulus, albeit smaller than Keynesian economists advocated and with no Republican votes in the House. Even Germany, that bastion of austerity, put aside its misgivings and approved its biggest stimulus package ever.

The crisis-induced embrace of Keynes infuriated the likes of German Finance Minister Peer Steinbrück, who complained in 2008, “The same people who would never touch deficit spending are now tossing around billions. The switch from decades of supply-side politics all the way to a crass Keynesianism is breathtaking.” Wrote John Cochrane of the University of Chicago Booth School of Business on his website: “If you believe the Keynesian argument for stimulus, you should think Bernie Madoff is a hero. Seriously. He took money from people who were saving it, and gave it to people who most assuredly were going to spend it.”

The Keynesian jolt didn’t last long. European governments pivoted to austerity on the theory that doing so would reassure investors and induce a wave of investment, creating growth and jobs. It didn’t happen. The U.S. was marginally less austere and grew a bit faster. But even in the U.S., stimulus faded quickly despite continuing high unemployment. Far from priming the pump, changes in government outlays actually subtracted from the growth of the U.S. economy in 2011, 2012, and 2013. The Japanese government has been running big deficits to compensate for chronic hoarding by households and businesses, but in April it faltered, chilling the nation’s halting recovery by raising the value-added tax to 8 percent from 5 percent.

With fiscal policy missing in action, the world’s biggest central banks tried heroically to plug the gap. The U.S. Federal Reserve cut interest rates to near zero, and when even that failed it tried some new tricks: buying bonds to bring down long-term interest rates (“quantitative easing”) and signaling the market that rates would stay low even after the economy was on the path to recovery (“forward guidance”). The limited effectiveness of those measures is sometimes chalked up as a failure of Keynesianism, but it’s just the opposite. Keynes was the economist who demonstrated that monetary policy ceases to be effective once interest rates hit zero and whose recommended policy in those circumstances was tax cuts and spending hikes.

Whatever the economic facts, the slowness of the global recovery soured people on governments’ ability to intervene for the good. Stimulus is a toxic word in the U.S. midterm elections; Obama got nowhere with his $302 billion bridges-and-potholes bill this year. Germany, far from using its economic power to become an engine of growth for Europe as requested by its trading partners, is expanding at the expense of other countries. It’s keeping its workers busy by producing goods and services for export, while not buying the goods and services produced by other countries. That explains why the surplus on its current account, the broad measure of trade and investment income, equals 7 percent of its gross domestic product, the highest among major economies.

This isn’t a stable status quo. The mid-October shock in global stock markets betrayed grave concerns about a relapse. While the U.S. economy is growing adequately for now despite the drag from fiscal policy, China’s pace is slowing, Japan is suffering from the self-inflicted wound of its consumption tax hike, and the 18-nation euro zone had zero growth in the second quarter. That simply isn’t good enough, Treasury Secretary Jacob Lew said in an October visit to Bloomberg. “You need all four wheels to be moving,” he said, “or it isn’t going to be a good ride.”

Enter Lord Keynes. Cutting interest rates is fine for raising growth in ordinary times, he said, because lower rates induce consumers to spend rather than save while stimulating businesses to invest. But where rates sink to the “lower bound” of zero, he showed, central banks become nearly powerless, while fiscal policy (taxes and spending) becomes highly effective as a fix for inadequate demand. Governments can raise spending to stimulate demand without having to worry about crowding out private investment—because there’s plenty of unused capacity, and their spending won’t lift interest rates.

It’s the closest thing economists have found to a free lunch. Keynes, ever the provocateur, argued that in a deep recession anything the government did to induce economic activity was better than nothing—even burying bottles stuffed with bank notes in coal mines for people to dig up.

Of course, it’s far better if the money is spent well. Considering the crying need for better roads, bridges, tunnels, schools, and the like, it’s a no-brainer for governments to build them now, when there are willing hands and cheap loans. Harvard economist Lawrence Summers, a former Treasury secretary, and Brad DeLong of the University of California at Berkeley argued in 2012 that infrastructure investment might even pay for itself, in part by keeping people employed so their skills don’t atrophy.

If instead governments of rich nations do nothing more, hoping their economies heal on their own, they’ll all risk getting stuck in the same rut that’s trapped Japan for most of the years since its postwar economic miracle abruptly ended in 1990. Inflation is a fixable problem, as former Federal Reserve Chairman Paul Volcker showed: You just jack up interest rates high enough to break the fever, with a deep recession an unfortunate but temporary side effect. Japanese-style deflation, the spawn of chronic slow growth, is harder to break. Even fiscal stimulus may not work if households and businesses fall into a funk. As with fighting an epidemic or an insurgency, it’s crucial to act fast before the enemy gains strength. “This is going to be a bad analogy, but it’s like the fight against ISIS,” says David Joy, chief market strategist at Ameriprise Financial (AMP).
 
Keynes could be difficult and inconsistent. Paul Samuelson, the late Nobel laureate economist, described his book The General Theory of Employment, Interest and Money as “badly written, poorly organized … arrogant, bad-tempered, polemical, and not overly generous in its acknowledgments,” before summing it up as “in short, a work of genius.”

The mid-October shock in global stock markets betrayed grave concerns about a relapse
Love him or hate him, there’s no one like Keynes on the world stage today. He was a statesman, a philosopher, a bohemian lover of ballet, and a member along with Virginia Woolf in the artsy, intellectual Bloomsbury Group. He made and lost fortunes as an investor and died rich. In 1919, in a prescient book called The Economic Consequences of the Peace, he condemned harsh reparations imposed on Germany after World War I, which were so punitive that they helped create the conditions for Adolf Hitler’s Third Reich. In 1936 he essentially invented the field of macroeconomics in his masterwork, The General Theory. From 1944 until close to his death at age 62 two years later, he led Britain’s delegation in negotiations that resulted in the founding of the International Monetary Fund and the World Bank.

In the 1950s and 1960s, Keynesian thinking ruled. President Kennedy’s chief economic adviser, Walter Heller, persuaded the president in 1963 to propose a tax cut to stimulate demand. (It passed in 1964, after his assassination.) “That was the first time in history that a president specifically endorsed and adopted the Keynesian approach,” Heller told the New York Times in 1987.

Keynes came under a cloud starting in the 1970s because his theories couldn’t readily account for stagflation—the coexistence of high unemployment and high inflation. Academic economists were drawn to the new theory of “rational expectations,” which said that government couldn’t possibly stimulate the economy through deficit spending because foresighted consumers would rationally expect that the stimulus would have to be paid for eventually and so would save for future tax hikes, offsetting the initiative. Supply-side economists said Keynes missed how low taxes could stimulate long-term growth by inducing work and investment. “Unsuccessful policies and confused debates have left Keynesian economics in disarray,” the Swedish economist Axel Leijonhufvud wrote in 1983 for a conference celebrating Keynes’s centennial. A successor theory that evolved in the 1980s and 1990s, New Keynesianism, attempted to inject rational expectations theory into Keynes’s worldview while preserving his observation that prices and wages are “sticky”—i.e., they don’t fall enough in a slump to equalize supply and demand. New Keynesians range from conservatives such as John Taylor of the Hoover Institution to liberals like Berkeley’s DeLong.

On Wall Street, Keynesianism never really died, because its theories did a good job of explaining the short-term fluctuations bank economists are paid to predict. “We approach forecasting more from a Keynesian perspective whether we like him or not,” says Joseph LaVorgna, chief U.S. economist at Deutsche Bank Securities (DB).

If Keynes were alive today, he might be warning of a repeat of 1937, when policy mistakes turned a promising recovery into history’s worst double dip. This time, Europe is the danger zone; then it was the U.S. What’s called the Great Depression was really two steep downturns in the U.S. The first ended in 1933. It was followed by four years of output growth averaging more than 9 percent a year, one of the strongest recoveries ever. What aborted the comeback is still debated. Some economists blame President Franklin Roosevelt for signing tax hikes and cuts in New Deal jobs programs. Others blame the Federal Reserve. Dartmouth College economist Douglas Irwin argues that the Roosevelt administration triggered the relapse by buying up gold, removing it from the U.S. monetary base. The move to prevent inflation succeeded all too well, causing deflation. Whatever the cause, Britain and other trading partners were dragged down, and U.S. output plunged and didn’t fully recover until America’s entry into World War II. “We are really at a kind of 1937 moment now,” says MIT’s Temin. “It’s a cautionary history for us.”

Now as then, getting out of the doldrums will take concerted international action. Any country that tries to stimulate growth alone is vulnerable to leakage; a lot of the buying power that it gins up gets spent on imports, so it doesn’t help domestic production or employment. Likewise, a country that wants to free-ride on its trading partners can cheapen its currency, allowing it to export more (and create jobs) while importing less (hurting employment abroad). That’s the very definition of beggar-thy-neighbor economic policies.

Keynes devised a solution for such behavior that he pressed for in his last years, but he was defeated at a conference in Bretton Woods, N.H., in 1944 by his American counterpart, Harry Dexter White, a senior official at the Department of the Treasury. Keynes called for an “international clearing union” that would strive to keep trade and investment in rough balance.

If Keynes were alive today, he might be warning of a repeat of 1937
The problem then, as now, is that creditor countries had all the power. They could demand that debtor nations pay interest on old loans instead of, say, feeding their children. Debts must be honored, of course. But Keynes understood that creditor countries have a part to play. They should give debtor countries some breathing room by buying more of their products and services. Today that would mean Germans vacationing more in Mykonos and buying more port wine, giving the Greeks and Portuguese the euros they need to service their loans from German banks. The concept was unarguable. But the U.S., running a trade surplus in 1944, had no interest in an international body that would tie its hands. (Today it’s Germany, sitting on a massive trade surplus, that doesn’t want to be told what to do.) The outcome was a less powerful organization, the International Monetary Fund, for aid to countries with balance-of-payments problems, and the World Bank, for promoting development in the poorest countries.

The big question is whether today’s international financial architecture is up to the challenge of restoring balance to global trade and investment. The IMF, to its credit, has pivoted away from the austere prescriptions of the “Washington Consensus” that it championed through the 1990s and toward a more Keynesian perspective. “His thinking is more relevant at the current juncture than it had been in previous troughs of the global economy,” says Gian Maria Milesi-Ferretti, deputy director of the IMF’s research department.


But the IMF lacks the authority that Keynes’s stillborn international clearing union would have had, and it’s perceived in some quarters to be beholden to U.S. interests. Brazil, China, India, Russia, and South Africa are trying to set up an alternative. Germany isn’t heeding the IMF much either as it presses France and Italy to take the same austerity medicine as Greece, Ireland, Portugal, and Spain. “Flash-in-the-pan, short-term stimulus programs” aren’t the way to boost growth, German Economics Minister Sigmar Gabriel said on Oct. 20 in advance of a joint ministerial meeting in Berlin. At loggerheads, the Germans and French punted a joint proposal to Dec. 1. Eswar Prasad, a Cornell University economist and author of The Dollar Trap: How the U.S. Dollar Tightened Its Grip on Global Finance, writes in an e-mail that Keynes’s proposed system “requires good domestic policies and a heavy dose of international cooperation,” both of which are in short supply.

So goes the fighting among the physicians as the patient ails. Keynes saw the same kind of flailing at the start of the Depression. “We have involved ourselves in a colossal muddle, having blundered in the control of a delicate machine, the working of which we do not understand,” he wrote in 1930. “The result is that our possibilities of wealth may run to waste for a time—perhaps for a long time.” Keynes himself has shown us the way out.

fonte

[Incognitus]

Dois problemas com o texto:

1) Como o artigo diz, o pessoal só se lembra de ser Keynesiano nestas alturas. E deixa de o ser quando sê-lo implicaria defender superávits orçamentais. Isso é insustentável.

2) O artigo apresenta o Japão como não tendo sido Keynesiano:

"If instead governments of rich nations do nothing more, hoping their economies heal on their own, they’ll all risk getting stuck in the same rut that’s trapped Japan for most of the years since its postwar economic miracle abruptly ended in 1990."

Isso não corresponde à realidade: