I’ve stopped doing instant reactions on Budgets. There’s always plenty available now, at places like Inside Story, as well as in the newspapers.
But there’s often something of interest that gets overlooked a bit. In this case, it’s the government’s proposal to legislate tax cuts for the rich seven years in advance. This is an idea with a lengthy and inglorious history, taken to a new extreme.
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In a comment posted yesterday, I said
I suppose this should be obvious, but the HC decision actually creates a perfect opportunity to generate divided loyalties where none previously existed. Suppose you want to run for Parliament but your parent came here as a 3-year old from some other country. A government official explains that the process of losing citizenship normally takes years, but for special friends of the country, it can be rushed through in time to nominate. After you have been elected, an issue arises where friends of the country concerned have an opportunity to do a favour. The logic is pretty clear.
Just a day later, we have the Oz reporting almost exactly this allegation against Labor MP Anne Aly. I have no idea of the validity or otherwise of the claim, but obviously it’s one that can now be made against anyone who has fallen afoul of the Court’s absurd rulings by having an overseas born parent, but who has been lucky enough to get expeditious treatment from the foreign government concerned.
But, just as Trump’s supporters have swallowed worse and worse things from him, I’m sure the fans of the High Court’s black letter approach to the Constitution will convince themselves that it’s all to the good that foreign governments are now in a position to interfere in our elections. That’s one of the notable things about adopting a really bad idea: the rationalizations needed to defend it pave the way for worse ideas to come.
Thanks to everyone who commented on the first nine chapters of my book-in-progress, Economics in Two Lessons.
Here’s a draft of Chapter 10: Market failure -Externalities and pollution. Comments, criticism and praise are welcome.
A new sandpit for long side discussions, conspiracy theories, idees fixes and so on.
Another Monday Message Board. Post comments on any topic. Civil discussion and no coarse language please. Side discussions and idees fixes to the sandpits, please.
The series of absurd rulings from our High Court has now reached the point where the majority of Australians are debarred from standing for election to Parliament, unless some foreign government chooses to help them. The latest ruling means that even renouncing a citizenship you never sought and have never exercised is not enough. Unless you start the process well before an election is even called, possibly years before, you are ineligible if you were born overseas, have an overseas-born parent and (probably) if you belong to an ethnic group which has a “right of return” to a national homeland. We have yet to explore the possible limits of other exclusion clauses.
There is some poetic justice in the embarrassment now being faced by Labor and Bill Shorten, who wrongly assumed they had prepared for the worst possible cases of High Court idiocy, and gloated over the misfortune of others. But that’s small comfort for anyone who would wish the outcome of democratic elections to be respected.
Until now, the line taken by the supporters of the High Court has been “it’s just a matter of following the rules”. It’s now been made clear that following the rules is impossible. An Australian citizen, even one who has never left Australia, can be ineligible simply because of the dilatoriness, incompetence, or even malice, of a foreign government. And, according to the High Court, there’s nothing they can do about it except wait.
The stupidity and bloody-mindedness of the High Court in this matter is matched by most of the political commentariat, and a large proportion of the Australian public, who will no doubt be represented in comments here.
From experience, I know that lots of readers will not be convinced. So, I will offer a question and answer another.
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It was the 200th anniversary of the birth of Karl Marx a couple of days ago. I planned to repost my series from 2011 on “Marxism without Revolution”, but didn’t get to it. I was reminded when Matt Yglesias mentioned it on Twitter, so here it is, in three parts.
Zombie ideas never die. Among the hardiest, it seems, is the suggestion that nuclear power represents a possible solution to Australia’s energy problems, including the need to decarbonize energy supply. I just received an invitation to an event entitled Going Nuclear: Reconsidering Australia’s Energy Mix being organized by the by Centre for Market Design at the University of Melbourne.
Here in Queensland, at least while the ALP is in office, we celebrate Labour Day as May Day, with a holiday long weekend on the first Monday in May. It’s a good time to think about how workers, in Australia and globally, can turn around the long decline in the reach and influence of trade unions and the resulting decline in the wage share of national income.
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Another Monday Message Board. Post comments on any topic. Civil discussion and no coarse language please. Side discussions and idees fixes to the sandpits, please.
… That’s a bit rich
That’s the headline for my latest piece in The Guardian. Final paras
unlike the BCA, its opponents have been willing to specify the measures needed to pay for these desirable outcomes. Eschewing the small target strategy routinely recommended for opposition parties seeking office, Labor has announced a range of revenue measures that would finance a substantial expenditure program, combined with some tax relief for low and middle income households. These include scaling back negative gearing, crackdowns on tax evasion and avoidance, and a restoration of the 2% levy on top incomes.
The Business Council has long been a weak and ineffectual participant in Australian policy debate. If it is to be taken seriously, it needs more than astroturf front groups and websites. The Council needs to take on some of its members, both in relation to their corporate behavior and in their resistance to any tax reform that might cause them any pain. Until then, Jennifer Westacott should be more cautious in asserting that others lack a plan and believe in “fairies at the bottom of the garden
If all the coal in the Galilee Basin were burned, it would make it just about impossible to stabilize the global climate. Most attention has been focused on the Adani Group’s proposal for an integrated mine-rail-port project to develop its proposed Carmichael mine. There are however a string of would-be followers, including GVK Hancock and Clive Palmer.
The good news is that Adani’s March deadline for financial close, itself a deferral of earlier promises, has passed with no sign of anyone willing to finance the proposal. Even the Abbot Point terminal, which has long-term take-or-pay contracts with existing coal mines, is struggling to refinance its debt.
But there’s no room for complacency.
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Another Monday Message Board. Post comments on any topic. Civil discussion and no coarse language please. Side discussions and idees fixes to the sandpits, please.
At a certain point in an academic career, you start getting lots of invitations to write book chapters, which is a lot easier than going through the mill of submitting articles to journals, dealing with referee reports and so on. I’ve had three emails in the last few days, telling me that books to which I’ve contributed chapters have come out.
The one of most interest to readers here will be The Coal Truth: The fight to stop Adani, defeat the big polluters and reclaim our democracy by David Ritter, with contributors including Adrian Burragubba, Tara Moss and Berndt Sellheim, Lesley Hughes,Hilary Bambrick, Ruchira Talukdar, Geoffrey Cousins and me. The title is self-explanatory. Although Adani seems to have gone quiet for the moment, this will be an important resource if the Galilee Basin project is revived, or for future struggles.
In addition, there’s the Sage Handbook of Neoliberalism, where I have a chapter on Rise, Decline and Future Prospects, and Human Forces and Engineering, which came out of a final year course for Honours Engineering students, to which I contributed a chapter oh climate change,
It’s now more than 100 years since Australian troops landed on a Turkish beach to take part in the disastrous Gallipoli campaign, which ended with nearly 30 000 Australians dead or wounded, among a total of up to half a million on both sides. For many of those years, I’ve been observing Anzac Day and mourning those losses. But in all that time, it’s never occurred to me ask why we were at war with Turkey, or rather why Turkey had chosen to join the German side in the Great War.
The answer is that the Ottoman government wanted an alliance with Britain and France, but was turned down. Russia, also allied with Britain and France, offered terms that amounted to a protectorate (it was the desire to keep Russia in the alliance that motivated the French rejection).
I’ve been arguing for a while that a Guarantee Minimum Income (or Universal Basic Income) ought to be combined with a Jobs Guarantee to would make paid work a genuine choice for everyone. To spell this out, the GMI/UBI would make it possible to live decently without paid work, while a Jobs Guarantee would ensure that paid work was available to everyone. As a medium term policy, the best form of GMI would, I think, be the participation income advocated by the late Tony Atkinson. That is, a payment conditional on some form of social contribution, including voluntary work, study and childcare. Support for such a policy entails a direct confrontation with the punitive attitudes behind policies like Work for the Dole, while still maintaining the widely-held principle of reciprocity.
I was going to write more about this, but I just received an article by Felix FitzRoy and Jim Jin, in the Journal of Poverty and Social Justice which presents the argument very well. So, I’ll just recommend that to anyone interested in the issue.
Another Monday Message Board. Post comments on any topic. Civil discussion and no coarse language please. Side discussions and idees fixes to the sandpits, please.
Socialism is much more than public ownership of productive enterprises. Still, if there is one policy that clearly distinguishes socialists from their (or rather our) opponents, it is support for public enterprise as a way of organizing large-scale production, and, in particular, as the preferred model for industries characterized by natural monopoly or other major market failures. The opposite view, dominant since the 1970s, is the market liberal framework that favors comprehensive private ownership, with “light-handed” regulation as the response to market “imperfections”.
Now that I’ve explicitly adopted the term “socialist”, I’ve been struck by the fact that I seem to be pushing against an open door. Consistent anti-socialists are pretty hard to find these days. Most of the Australian right favors the compulsory acquisition of the Liddell power station, on the grounds that they don’t like the business decisions of its owner. On that basis, it’s hard to see why we shouldn’t nationalise the entire financial sector.
As regards public infrastructure, the Institute of Public Affairs, once our leading free-market thinktank, has become an advocate for publicly-funded dam projects in Northern Australia, the most notorious of all pork-barrel projects. Malcolm Turnbull is pushing Snowy Hydro 2.0.
These examples illustrate a problem. Having started by rejecting public ownership on principle, market conservatives have no theory to work on when they lose those principles. So, they naturally support the worst kinds of boondoggles, based on political expediency.
As a socialist, I support a mixed economy in which both public and private ownership play important roles. The evidence of the past century shows, in my view, that most large-scale infrastructure should be publicly owned, and operate on a statutory authority model, accountable to the public through governments, but with politicians kept at arms length from day-to-day decisions. On the other hand, small business should be left to private ownership. That leaves a large share of the economy to balance between large for-profit corporations and public enterprise. The design of a mixed economy involves getting that balance right.
Thanks to everyone who the first eight chapters of my book-in-progress, Economics in Two Lessons. I’ve found the comments on Chapter 8 valuable, but haven’t yet found time to edit in response to them. Soon, I hope!
In the meantime, I’ve posted a draft of Chapter 9: Market Failure. Comments, criticism and praise are welcome.
As I mentioned a while ago, in the years that I’ve been blogging, I’ve described my political perspective as “social-democratic”. In earlier years, I mostly used “democratic socialist”. My reason for the switch was that, in a market liberal/neoliberal era, the term “socialist” had become a statement of aspiration without any concrete meaning or any serious prospect of realisation. By contrast, “social democracy” represented the Keynesian welfare state I was defending against market liberal “reform”.
In the decade since the Global Financial Crisis, things have changed. Socialism still describes an aspiration, rather than a concrete political program, but an aspiration to a better society is what we need now as a positive response to the evident failure of neoliberalism.
On the other side of the ledger, nominally social democratic parties nearly all failed the test of the crisis, accepting to a greater or lesser degree to the politics of austerity. Some, like PASOK in Greece, have paid the price in full. Others, like Labor in Australia, are finally showing some spine. In practice, though, social democracy has come to stand, at best, for technocratic managerialism, and at worst for capitulation to the demands of financial capital.
So, I’ve changed the description of this blog’s perspective to socialist. I haven’t however, adopted the formulation “democratic socialist” which was used, in the 20th century, to emphasise a rejection of the Stalinist claim to have produced “actually existing socialism” in the Soviet Union and elsewhere. That’s no longer necessary.
As has been true for most of the history of the modern world, the only serious threat to democracy is now coming from the right. So, it’s important to defend democracy as well as advancing the case for socialism.
A new sandpit for long side discussions, conspiracy theories, idees fixes and so on.
Another Monday Message Board. Post comments on any topic. Civil discussion and no coarse language please. Side discussions and idees fixes to the sandpits, please.
A while ago, I had a multi-topic post covering some things I hoped to expand on. One of them was this
Blowing things and people up is seen as a demonstration of clarity and resolve, unless someone is doing it to us, in which case it’s correctly recognised as cowardly and evil. The most striking recent example (on “our” side) was the instant and near-universal approval of Trump’s bombing of an airfield in Syria, which had no effect at all on events there.
We’ve now had another round of bombing from Trump, and yet more instant applause. As I reread the para above, and looked at evidence on the general ineffectiveness of airstrikes, it struck me that there is a big asymmetry. The satisfaction we get when our side blows something or someone up is trivial in comparison to the hatred generated when we are on the receiving end. In most cases, the people and resources mobilised against the bomber far outweigh the physical destruction the bomber can inflict. Here’s a study (paywalled, but the abstract is clear) making that point about Vietnam; it seems to be entirely general.
I’ve talked here about large-scale aerial bombing, but all of these points apply with equal force to bombing campaigns undertaken on the ground by non-state actors, going back to the “propaganda of the deed” in the 19th century. Experience has shown that deeds like bombings and assassinations make great propaganda, but not for the side that carries them out.
Henry Farrell’s recent post on the irrelevance of conservative intellectuals reminded me of this one from 2013, which concluded
Conservative reform of the Republican party is a project that has already failed. The only question is whether the remaining participants will choose hackery or heresy.
Overwhelmingly, the choice has been hackery (or, a little more honorably, silence).
The case for hackery is put most clearly by Henry Olsen. Starting from the evident fact that most Republican voters are white nationalists who don’t care about small government, Olsen considers the options available to small government conservatives. He rapidly dismisses the ideas of challenging Trump or forming a third party, and concludes that the only option is to capitulate. Strikingly, the option of withdrawing from party politics, and arguing for small government positions as an independent critic isn’t even considered.
As Paul Krugman has observed recently, conservative economists (at least, those who comment publicly). are a striking example for the choice of hackery over heresy. Krugman, along with Brad DeLong, has been particularly critical of a group of economists (Robert Barro, Michael Boskin, John Cogan, Douglas Holtz-Eakin, Glenn Hubbard, Lawrence Lindsey, Harvey Rosen, George Shultz and John. Taylor) who’ve made dishonest arguments in favor of corporate tax cuts.
Recently, an overlapping group (Boskin, John Cochrane, Cogan, Shultz and Taylor) have taken the hackery a significant step further.
Another Monday Message Board. Post comments on any topic. Civil discussion and no coarse language please. Side discussions and idees fixes to the sandpits, please.
Thanks to everyone who the first seven chapters of my book-in-progress, Economics in Two Lessons. I’ve tried to think about all of them and respond to as many as possible, but I’m seeking comments from quite a few sources and may have missed some. Feel free to remind me if you think you have a point that’s been overlooked.,
I’ve just posted a draft of Chapter 8:Unemployment. This is one of the most important chapters in the book where I confront a central error in both Hazlitt and Bastiat – the implicit assumption that full employment is the norm in a market economy. So,
The proposal of the pompously named “Monash Group” that public funds should be allocated to investment in coal-fired power stations is, of course, absurd. Leaving aside its environmental effects, new coal-fired power is far more expensive than renewables or gas.
Nevertheless, the proposal is welcome in a number of respects.
Lachlan Harris and Andrew Charlton have a piece in the Fairfax press decrying the collapse of centrism in Australia.
There are some problems with their data. As William Bowe has pointed out, the change in voter attitudes described by Harris and Charlton as “polarisation” looks more like a straighforward increase in support for the left, rising from 19.5 per cent to 31.4 per cent over the period 1996 to 2016. Measures of voter disaffection show no consistent trend over the period except for a sharp uptick in 2016.
Regardless of the data, there’s no reason to dispute the central claim that Australian politics is more polarised than at any time in the past twenty years.
The big problem with the piece, and the besetting sin of centrist analysis, is the near-complete absence of discussion of actual policy. The assumption is simply that whoever is in the middle must be right.
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Thanks to everyone who the first six chapters of my book, Economics in Two Lessons. That brings us to the end of Lesson 1: Market prices reflect and determine opportunity costs faced by consumers and producers.
Now its time for Lesson Two: Market prices don’t reflect all the opportunity costs we face as a society.
I’ll start with a brief intro and then the draft of Chapter 7: Property rights, and income distribution
As usual, I welcome comments, criticism and encouragement.
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Most of the political commentariat were convinced that Bill Shorten had got things badly wrong by announcing his policy on dividend imputation immediately before the Batman by-election. It was even more striking that, despite the pressure, Shorten didn’t cave into demands for changes to the policy. Michelle Grattan, for example, described the policy as an “own goal“. After Labor’s easy win, she backed off a little bit, but still claimed that Labor “has a selling job“. M
Maybe so, but I’d say the government is the one that has scored goals for the other side.
(Update 27/3) As predicted, Labor has tweaked the policy to exclude pensioners. That blunts the remaining lines of attack, but doesn’t cost much money, since the benefits go primarily to high-wealth self-funded (but massively tax-subsidised) retirees. By waiting until after the Batman by-election and the latest Newspoll, Labor looks gutsy (even Dennis Shanahan in the Oz conceded this) and Turnbull looks even weaker than before
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