Yet more way overdue climate economics scepticism

Further to yesterday's post:  there's been a good thread on Twitter about this, which I think you will find here.

And Ken Rice has tweeted a link to a paper from 2016 that appears to show (I only have time to scan it at the moment) that DICE models tested with 20th century growth show results nothing like what actually happened.

Interesting, but as I've been saying - why has it taken so long for people to question this whole field in the way that they finally are now?

Oh:  and someone on Twitter linked to an article on GDP effects of climate change that made some interesting points - but I am having trouble finding it now.   Keeping track of info via blogs used to be much easier than it is under Twitter.

Update:  Jason, do you have any idea what Graeme's story about you in the comment I have left is about?

Graeme - don't get optimistic.   99% of your comments are still going to be deleted, whatever they are about. 

About climate economics

I had been posting for a number of years that economic modelling on the cost of climate change seemed dubious at best, and a complete crock at worst.  I was puzzled that Pindyck's criticisms didn't have more publicity.

I think this view has finally spread more widely, not only amongst science exaggerating political movements such as Extinction Rebellion, but more broadly into mainstream opinion.

I hadn't realised that controversial Australian economist Steven Keen had thrown his commentary into the mix too.   Now, I know a lot of people attack him for exaggerated attacks on various economic issues (house price bubbles especially, I think), but if he is right in his criticisms in this post, and in the video following, it does seem remarkable that it has taken this long for people to say "this can't be right".



I also note that last month And Then There's Physics had a post and thread about the related topic of Integrated Assessment Models.   Many good comments about them are to be found there. 

Isn't it pathetic...

Andrew Bolt is in panic mode, drumming up the anti-Turnbull forces all because Turnbull believes in climate change and thinks "Direct Action" is an economic crock.    Alan Jones apparently came out in support of Abbott this morning, and I can guess this would be part of the reason for him too.   And the dynamic Warren Truss is warbling on about how Turnbull would have to promise the Nationals that he won't introduce an ETS.

As I wrote recently at John Quiggin's:  this is exactly what's wrong with the Coalition since the year Abbott got the leadership - they are basing all decisions on a matter of non-scientific nonsense - that climate change isn't real and/or deserves no response, and anyone who believes otherwise must be out to destroy the country economically.  

Until the Coalition is purged of the large faction of climate change deniers, this split in the party renders them incapable of presenting a sensible unified approach to not just climate change, but economics generally.

Taking the Right personally

I like watching Kitchen Cabinet for the opportunity it gives to view politicians in what is meant to be a more relaxed atmosphere, talking to the very congenial Annabel Crabbe over a meal.

I know that people will say that it is simply a part of my complaint that the Right side of politics has been badly damaged here due to the poisonous influence to the ideologically motivated side of the American Right that has lost interest in both evidence based science and economics, but I have to say, I now find that nearly all Coalition politicians compare very poorly to Labor ones, even at a personality level.

Coalition politicians nearly always come across as being nervous ninnies.  Tony Abbott and his "ha...ha...ha;"  Christopher Pyne and his career mother Amanda Vanstone didn't impress me (even though Vanstone is from the moderate wing of the spectrum); and while Andrew Robb might be admired for his gumption despite suffering long term depression, he does appear to now be a permanently glum robot incapable of pleasure (perhaps?) because of medication, and I was dismayed to be reminded that it was a man suffering long term mental illness who roused himself out of his sick bed to convince his fellow politicians to dump support for an ETS, leading to the current hopeless Prime Minister we endure.   I don't remember much about Joe Hockey's episode, except that he was another male politician who has an almost child like inability to cook anything other than a steak.  Yet he has so comprehensively stuffed up the Budget, and come out as an obsessive about wind power to the extent that a wind mill on the horizon 15 km away upsets him, he's turned out to be a pretty comprehensive embarrassment to the party.

There are exceptions, I suppose:  I certainly don't consider Barnaby Joyce to be the sharpest knife in the drawer, but I can see why people like him anyway.   Nigel Scullion from the Northern Territory also has a certain pleasant air of frankness about him.

But in comparison, I usually find myself pleasantly surprised by the relaxed air of intelligence of your average Labor politician on the show.

I know Bill Shorten was just a bit too lovely dovey on screen with his wife for comfort, but I still felt better about him after the show than before.  (I have always felt relatively neutral towards him.  I think it was painful watching him suffer by the way he was caught up in the Rudd/Gillard battles.)   I am strongly against lesbian couples using some donor semen to make their own baby, but again, after watching Penny Wong I found myself liking her a lot more than before.   Craig Emerson presented as living in extremely modest circumstances, and really, what was he thinking with his little song and dance routine while he was still in power?   Still, I found it hard not to warm more to him as a result of Annabel's show.

And let's broaden this out a bit:  in commentary terms, Andrew Bolt has evolved into a self satisfied ugly caricature of  moderate Right wing analysis with his self pity and obsession with race and portraying Islam in the worst possible light.  As for climate change - he is a complete gullible joke, of course, never showing a scintilla of skepticism towards anything he reads from Watts Up With That or Professors Jonova and  Monckton.  His disingenuous enthusiasm for endorsing all of the Michael Smith sliming of Gillard (while always adding the disclaimer that "Gillard denies ever having knowledge of the matters") was really appalling.

Tim Blair doesn't seem to realise that the "frightbat" thing just carried too much Young Liberal style undergraduate sexism to be funny, and while he doesn't put the same enthusiasm into climate change denial as does Bolt, his reading list on the topic is clearly limited to denial sites.  It's hard to stay enthusiastic for his brand of lightweight critique of the silly elements of Left wing culture and attitudes when he so proudly wears his intellectual laziness on the key environmental issue of our day on his sleeve.

They both like Mark Steyn, of course, who thinks he can call a scientist a fraud, despite no support amongst other scientist in the field for such a view, and then defend it as free speech, while using his corner of the climate change culture war to get more money from his deluded readers.   

And as for News Corp Right wing female commentators and their attitude towards "feminism" (Miranda Devine, Albrechtsen, Sloan) gee, its got pretty ugly when they spent all their time criticising Gillard for "playing the feminism card" instead of  noting the appalling treatment she got from Right wing broadcasters and the patronising and offensive lines Abbott used.  

So it's remarkable how unlikeable I find so many on the Right have become.   And while I have been saying for a long time that attitude to climate change seems to have become an incredibly good bellwether on political judgement generally, it seems to give a good indication of  unpleasant aspects of personality too.

There are, of course, exceptions to this, even on the Left.   Step up, K Rudd, and take a bow...

On looking at the old Catallaxy

So there was much wailing and grinding of teeth on the weekend from the wingnut Catallaxy club - I was able to spend quite a few merry hours trolling them.  

The site is now deleted - save for some captures done by the National Library.   (Mind you, they have saved some pages of this blog too - so that's not particularly significant in the scheme of things.)

But there is also still, for some reason, a bit of the old version of Catallaxy hanging around the internet - before it moved to its last hosting arrangement, I think.   It's from 2010, and it's interesting to see what the blog was talking about then.

You can see how it was a hotbed for climate change denial/"scepticism".   Rafe was promoting Monckton articles that appeared in Watts Up With That, Sinclair was giving hat tips to arts graduate Delingpole.   He and Chris Berg were apparently in an article in the IPA Review about "Climategate."   Oh, and "Glaciergate" gets a couple of mentions by Sinclair too - that embarrassing but relatively minor, quickly identified, mistake in an IPCC report which no one sensible ever thought demonstrated that climate change science in totality was wrong. 

Move a decade in the future, and the blog was still heavily devoted, mainly from Rafe's posts, to denying climate change and scaremongering about the cost of changing to clean power.   Sinclair  stopped posting about the topic some time ago - maybe he has modified his views, while nonetheless being happy to have Rafe and Moran crap on weekly about how bad renewable energy is, and Steve Kates (literally) call people idiots for believing in AGW at all, and the Left evil.   Who knows?

It was certainly not as if Sinclair was into admitting error - remember the Monty temporary banning in 2014 for pointing out his stagflation call?   

Speaking of economics more generally, here he is praising this assessment of Keynesian economics:

Ultimately, any economic theory, if it is to survive, must withstand repeated attempts to falsify it, repeated exposure to the predictive test that deductive science imposes on its creations. The Keynesian model (I call it this rather than the model of Keynes since no master should ever be judged by the words of his inadequate disciples) was floored by a sequence of empirical failures: an alleged consumption multiplier that regularly under-performed; an alleged inelasticity of aggregate investment to interest rate changes that was notable by its absence; a liquidity trap that failed to manifest itself; a Phillips curve trade-off between the rate of unemployment and the rate of price inflation that proved to be explosively unstable; a flexible exchange- rate system that eliminated final macroeconomic vestiges of fiscal influence. …
…
Dear reader, the Keynesian model never worked; and never will work. It has been resuscitated by opportunistic economists, not because they believe in its merits as an agent of macroeconomic rehabilitation, but because they recognize its political value as a weapon for moving economies from laissez-faire to state capitalism, or (hopefully) beyond that to fully-fledged socialism.

Now, I'm not qualified to understand a lot of those claims - but thanks to Sinclair's failed stagflation warning made a year or so after that post, I can tell that this was probably a load of exaggerated bollocks.   So, yeah, Catallaxy was good for that!

Oh, and look:  there's a post in which Sinclair is apparently endorsing Nigel Farage "Telling the EU where to get off".   Gee, Brexit has gone so well.   

In the spirit of generosity, and bearing in mind the internet never forgets, if Sinclair would like to appear in comments here and confess his mistakes and errors, he's welcome to.

Heh. 

Update:   someone called Adam has created a clone (in appearance) of the deleted Catallaxy site, and all the people who regularly posted there have migrated to the open thread.  I see Sinclair has turned up with this message:

Ah yes:  that would be the blog where I voluntarily stopped commenting because an old regular could make a comment about how a woman (I forget who) should be "kicked in the slats" and Sinclair wouldn't moderate it.   Or more recently, where a male commenter could call an apparent rape victim in the news "a dud root", and again, the comment remained there.   

Sinclair let it turn into a toilet that he would not moderate to any reasonable standard of civility.  Golf clap for libertarianism, hey.  

As I explained in my comment at monty's post in 2014:

....I can't tolerate the lack of overall moderation of the place any more. I have a theory that Sinclair might consider the blog threads are a sort of "test" of how libertarian communities might self moderate - if someone says something outrageous and offensive, then others might try to pull them in line and a certain natural level of acceptable propriety prevail.

In fact, this happens exceptionally rarely, so that the blog threads have become full of sexist and (for want of a better word) "homophobic" comments which, if I overheard in a pub, would offend me and make me slide away from the group. And when they get onto racism issues it can get exceptionally ugly, and pretty dumb.

As I have said over the years, it particularly annoys me when the women who comment there let offensive comments slide (IT and his twice made comment now that a woman deserves a "kick in the slats", for example.) And that Sinclair, despite his presumed friendship with Tim Wilson, rarely does a thing about the way homosexuality is used for the purpose of ridicule.

Sorry, but blog moderation that extends to "no one uses the 'c' word, and if I notice something I think is a bit OTT I might delete it" has made the place too ugly to be seen in.

So, yeah, it was a "wonderful" place for intense and offensive sexism, homophobia, and racism (although I have not preserved examples of the latter - but even JC would complain about that, so I am far from imagining it.)

It was a toilet that deserved to go, and the world is a better place that it has.

How dare Parkinson defend himself!

The print version of Catallaxy (The Australian) is full of indignation that Martin Parkinson has defended the response of the Rudd/Swan government to the GFC (they, after all, were following his Department's advice which he has fully endorsed), after current cigar smoking Finance Minister Cormann was out launching some attack on Parkinson's policy from a little known, IPA aligned, economist from that power house of economics, Griffith University.

Did you see how much Groucho Ergas went on about this yesterday?  Is he paid by the word?  Today it's the turn of the least favourite economist in the land for giving key note addresses at what is meant to be a celebratory dinner, Judith "You're all Lazy Idiots!" Sloan.

I thought these economists who are outraged at Parkinson being so "political" might have asked themselves the question - who started this in the first place?   Parkinson is leaving his job early because of the sway of the cranky and deluded IPA/Boltardian Right - of which Sloan, Ergas and Davdison are the leading lights (lights with about the same utility as glow in the dark dinosaurs) - because he believes in climate change and has the belief shared by nearly every other economist not of the Catallaxy brand that Australia's successful passage through the GFC probably was in some significant part due to the stimulus policy.

Furthermore, Cormann is not content to wait til Parkinson leaves to be seen endorsing Makin's attack on his views, he's doing it now.

The politicisation of the matter is all of the Right's doing.


Update:  by the way, the IPA's Chris Berg is widely regarded as the most affable of the Institute's talking heads that still get given a ridiculous amount of time on the ABC to sprout their one eyed views.   But his entry into the commentary on the politics and economics of the GFC stimulus last week I think shows him up as just another Right wing economic lightweight who has drunk the IPA kool aid.  [Update:  see how he wasn't taking any strong position on this only 12 months ago?]

It also seems to me that he never talks about climate change.  The most he has said (that I recall) is (my paraphrase) that if you have to have a policy to tackle it, a carbon tax is the way to do it.   (Even Sinclair Davidson has said that in the past I think.)

But anyone who works for the IPA is forever tainted by the fact they make their money from an institute supported by at least one prominent billionaire miner which pays people to ridicule climate science and all policy directed towards reducing CO2.   Berg gets too easy a ride for appearing nice (certainly, he doesn't come across as an aggressive and unpleasant fellow like Roskam)  but he should be shamed for working for the IPA at all.   

Update 2:   the blogging head of the Insane Clown Posse that is Catallaxy (I'm trying out for a sort of Bernard Keane degree of sarcasm today)   Sinclair Davidson joins in the criticism of Parkinson, claiming that Makin's critique is obviously right, and again confirming that the government should be completely political in immediate sackings of public servant heads.

Is all of this angst because Judith isn't getting Parkinson's job?  (Reference to likely joke rumour that I don't believe.)

Economist confirms economics fail

Economics: Current climate models are grossly misleading : Nature News & Comment

Well, now even Nicholas Stern is joining in on the "economic modelling we've been using for climate effects is almost certainly a crock for being too optimistic" line.

Seems a bit late for that now, doesn't it?   He should have been arguing that about 10 years ago, and just saying something like this:  "Ha!  you expect us to be able to calculate the effect of climate change of various types and uncertain extremity on GDP in 100 years time?   Forget it.   There's obvious potential for massive damage to humanity and its built and natural environment: you just need to get urgent policies into place to get CO2 down now."

A handy Krugman summary

Delusions of Reason - NYTimes.com

Paul Krugman had a short post at his blog summarising the problem with the current Republican Party:

Brad likes to tell the (second-hand) tale of Larry Lindsey arriving at the Council of Economic Advisers in 2001 and declaring that the people who really understood economics had arrived. A lot of 1-percent Romney supporters believed that only the unwashed masses could actually believe that Obama was making more sense on economic policy. And so on.

What’s so strange about this is that everything — everything — that has happened for the past decade has demonstrated the opposite. Modern Republicans are devotees of faith-based analysis on every front. On economics, in particular, they are devoted to supply-side fantasies that keep being refuted by evidence — and their reaction is to try to suppress the evidence. They’ve spent pretty much the whole past four years issuing dire warnings about inflation and soaring interest rates that keep not coming true; they cling to the belief that if only a Republican were in office we’d have a 1982-style recovery even though economists who actually studied past financial crises predicted the slow recovery in advance.

And don’t even get me started on climate change.

The truth is that the modern GOP is deeply anti-intellectual, and has as its fundamental goal not just a rollback of the welfare state but a rollback of the Enlightenment. Yet there are some wannabe intellectuals who delude themselves into believing that they have aligned themselves with the party of objective (as opposed to Objectivist) analysis.

You might think that the election debacle would force some reconsideration. But I doubt it; if the financial crisis didn’t do it, nothing will.

Well, "the rollback of the Enlighenment" might be taking it one step too far, but generally speaking, it's hard to disagree that on both science and economics, the Right in the US seems more devoted to ideology than evidence.

 

I try to be charitable, but...

....Steve Kates just couldn't be more stupidly un-self aware if he tried. 

Here's the shorter version of what he's been writing for years "Why won't they engage in good faith dialogue, those moronic Lefties who want to kill everything good in the world and crush us under their totalitarian heal?  They need to dialogue, so as to learn how I understand both economics (buy my book) and the science of climate change perfectly, and they don't have a clue."

The point I was trying to make yesterday is that it is all very well to be speaking among ourselves on our side of the fence but useless if we cannot force these climate totalitarians to engage in a dialogue.....There is, of course, nothing that these ignoramuses say that we are unaware of. They, on the other hand, are unaware of every bit of the counter-arguments that have been made on our side. They are certainly unaware of the massive evidence proving that they are almost certainly wrong.

When a person is so clueless as to what the "massive evidence" actually says about climate change, and is always claiming evil ulterior motives on those who he does not agree with, why would anyone try to "dialogue" with him?   It's why no one bothers engaging on the topic on the science side at his Catallaxy outlet anymore.  They are, as with their contrarian scientist heros, nearly all old obnoxious cranks who'll be dead within 20 years anyway.  Unfortunately, we can't wait that long to get into serious CO2 reduction, though.

And it's fair enough that The Conversation won't let denialists engage in comments debate anymore.  It's pointless and just as bad as it would be to allow nutty anti-vaxers free rein on the site.

Jason, it must be a residual bit of your libertarian past that the Conversation policy annoys you - and citing Ian Plimer, for God's sake.  He has zero credibility on the topic; always has.  Freeman Dyson has next to no credibility on this topic - which is one well out of his field of expertise, too.

Stop being such a sucker for thinking people with high IQ and success in one field are worth paying attention to in fields outside of their expertise.  They very often aren't.

 

Keynes and the long term

Yesterday, when the story about Niall Ferguson quipping that Keynes didn't worry about the future because he was gay and childless was doing the rounds, I commented elsewhere that having children certainly seems to have no effect at all on the Tea Party Right and their dismissive attitude to the long term  issue of climate change.   (The point being that they are an obvious example of how having kids is not co-related to "concern with the future of humanity".)

But what I suspected was that Ferguson's take on Keynes not being concerned about the future was the more fundamentally wrongheaded claim.  Not being one who reads much about economics, though, I didn't know where to find a good commentary on this aspect.

Overnight, what I wanted appeared at Slate.  It's a good read.  Here is the opening slab, for which I trust Slate will forgive me for reproducing:

Niall Ferguson, the distinguished historian who for the past several years has increasingly abandoned his trade in favor of inept conservative punditry, stepped in it over the weekend when he told an investors’ conference that John Maynard Keynes’ allegedly misguided ideas stemmed from the fact that he was gay and had no intention of having children, and was thus blinded to the importance of long-run considerations.

When an uproar ensued, Ferguson, to his credit, offered a full and complete apology on his website. But both the controversy and the apology primarily reflect the welcome fact that gay-bashing is increasingly frowned upon in polite society. They don’t confront the larger smear, which is against Keynes’ ideas. The fact of the matter is that both Keynes personally and “Keynesian” thinkers about macroeconomics in general care deeply about long-term issues. In fact, Keynes is one of the deepest thinkers about the long-term economic trajectory of all time.

The assumption that Keynes only cared about the short run stems from Keynes’ too-often quoted line that “in the long-term we are all dead.” This is, obviously, true. But while it’s often taken to be something like a 1930s version of YOLO, that kind of carpe diem economics has nothing to do with what Keynes was actually writing about.

The line appears not in the General Theory of Employment, Interest, and Money but in 1923’s Tract on Monetary Reform. Most countries, including Great Britain, had abandoned the gold standard during World War I. After the war, the major powers sought to return to gold and the British authorities wanted to return their currency to its pre-war peg, a step Keynes thought would be disastrous. The question of the long run arose in response to the claim that overvaluing a currency relative to the currencies of its trade partners can’t make a difference since in the long-run domestic prices will adjust to any exchange rate.

Keynes says that this is true. If after the conclusion of the American Civil War “the American dollar had been stabilized and defined by law at 10 percent below its present value” that would have had no implications for the world economy of the 1920s, 60 years later. Nominal prices would have adjusted. “But this long run is a misleading guide to current affairs,” he wrote, “In the long run we are all dead. Economists set themselves too easy, too useless a task if in tempestuous seasons they can only tell us that when the storm is long past the ocean is flat again.”

Read the whole thing.

It certainly helps illustrate the intellectual poverty of what passes for much Right wing commentary on economics in the last few years.

The de-evolution of Mark Latham

Mark Latham's descendent into creepy old man Right wing culture war whinger was on full display in his maiden speech to the New South Wales Parliament, where some high(?)lights included:

"Like a scene from Orwell's Animal Farm, the Green-Labor-Left has become the thing it originally opposed: elitist, would-be dictators taking away from the working-class communities the things these battlers value."

He also attacked political correctness and the "confected outrage" of the "elites".

Quoting Monty Python actor John Cleese, Mr Latham argued that telling a joke about someone does not mean you hate them.

"We love the people we joke about — the Irish, the blondes, the gays, everyone — as they've helped to bring humour and joy into our lives."

Yeah, tremendous jokes and commentary such as he gave on Sky News recently:

Discussing the new "Respect Victoria: Call It Out" advertisement in which a man leers at a woman on a train – eyes running down and up her, persisting despite her visible discomfort and distress – Latham dismissed the man’s behaviour as normal.

“If you don’t have a good look at a beautiful person of the opposite sex there’s something wrong with you,” the One Nation NSW leader said on Sky News last week.

“Was he thinking … did I used to root her at uni?”

 The rest of the summary of his speech:

The One Nation MP spoke for more than 47 minutes, calling for limits on immigration, an end to identity politics, an overhaul of the state's education system and the introduction of nuclear power and greater investment in coal-fired power.

If you want to read how much he has devolved, have a look at this 2014 piece with its moderate,  thoughtful and regretful analysis of why climate change denialism had been so successful amongst large parts of the public.

Now he belongs to a climate change denying party.  (One Nation's policy position on this looks like it was written by nutter Malcolm Roberts.)  

His culture war whinging has won him many admirers at Catallaxy - fellow man-stuck-in-the-social- zeitgeist of the 1950's, CL claims this:

It’s really disappointing to me that Latham cannot be prime minister.
He is the outstanding man in Australia’s polity right now.

It all again shows that Right wing opposition to climate change action is simply based on culture war resentment and has nothing to do with a serious consideration of science or economics.

One final question:   doesn't Latham's wife find this change of persona worrying?   It must be like living with a different man from the one she married.   And don't his sons, who must at least be teenage now, find him cringeworthy and "old before his time" as well?
 

Straight talking from John Quiggin

John Quiggin resigned from the Climate Change Authority with this bit of straight talking:

The government’s refusal to accept the advice of its own Authority, despite wide support for that advice from business, environmental groups and the community as a whole, reflects the comprehensive failure of its policies on energy and the environment. These failures can be traced, in large measure, to the fact that the government is beholden to rightwing anti-science activists in its own ranks and in the media. Rather than resist these extremists, the Turnbull government has chosen to treat the vital issues of climate change and energy security as an opportunity for political pointscoring and culture war rhetoric.

I do not believe there is anything useful to be gained by providing objective advice based on science and economic analysis to a government dominated by elements hostile to both science and economics.

As I've said before, there needs to a formal split between the climate change deniers in the Coalition, and the sensible.  I can't see how Turnbull can really keep pandering to the foolish within his government.

Go, Lenore...

No one can make Tony Abbott's climate plan add up, so he should do the maths | World news | theguardian.com

Lenore Taylor makes some points about Tony Abbott and his "direct action" plan which are obvious but being pretty much avoided by Rudd.  (I assume his thinking is "stay away from the carbon tax; people don't like to be reminded about it.):

It’s not that “direct action” can’t work to reduce carbon emissions. It’s that the Coalition’s Direct Action plan – cobbled together in a couple months after Tony Abbott took the Liberal leadership and ditched the Coalition’s support for emissions trading – can’t work for the money that’s on the table.

And almost no one thinks it can. Not the business groups that have for years now been unsuccessfully seeking detail. Not academic experts who have studied the various sources of carbon abatement it proposes. And not anyone who has sought to model it.

The Coalition has responded to the latest effort – from Sinclair Knight Merz/MMA and Monash University's Centre of Policy Studies – by shooting the messenger, suggesting the modellers and the Climate Institute who commissioned them are not “objective”.

But exactly the same question has been raised by pretty much everyone who has looked at Direct Action. The Treasury actually calculated the shortfall would be much bigger than the $4bn the new modelling has estimated by 2020.

And, as Abbott’s own frontbencher Malcolm Turnbull explained in 2011, continuing with Direct Action would become prohibitively expensive in future years.

On 4 February 2010, Abbott wrote this about his newly minted Direct Action plan: "Our policy is also much cheaper. We have estimated that it will cost $3.2bn over four years ... Our policy has been independently costed. A team of economists at the respected firm Frontier Economics says our policy is both economically and environmentally responsible."

But the managing director of Frontier Economics, Danny Price, said at the time it only made sense as a transitional plan, a precursor to either a more developed set of “Direct Action” regulations, subsidies and “reverse auctions”, or, more likely, some version of an emissions trading scheme.

But no, Kevin, let's talk about corporate tax rates in the Northern Territory in 2018...

Krugman connects the dots

Paul Krugman writes:

Recently Dr. Peter Hotez, a leading vaccine scientist and a frequent target of anti-vaxxer harassment, expressed some puzzlement in a post on X, formerly Twitter. He noted that many of those taunting him were also “big time into bitcoin or cryptocurrency” and declared that “I can’t quite connect the dots on that one.”

OK, I can help with that. Also, welcome to my world.

If you regularly follow debates about public policy, especially those involving wealthy tech bros, it’s obvious that there’s a strong correlation among the three Cs: climate denial, Covid vaccine denial and cryptocurrency cultism.

I’ve written about some of these things before, in the context of Silicon Valley’s enthusiasm for Robert F. Kennedy Jr. But in the light of Hotez’s puzzlement — and also the rise of Vivek Ramaswamy, another crank, who won’t get the G.O.P. nomination but could conceivably become Donald Trump’s running mate — I want to say more about what these various forms of crankdom have in common and why they appeal to so many wealthy men.

The key thing is, success can easily lead to over-estimation of your ability to understand complicated stuff:

Success all too easily feeds the belief that you’re smarter than anyone else, so you can master any subject without working hard to understand the issues or consulting people who have; this kind of arrogance may be especially rife among tech types who got rich by defying conventional wisdom. The wealthy also tend to surround themselves with people who tell them how brilliant they are or with other wealthy people who join them in mutual affirmation of their superiority to mere technical drones — what the tech writer Anil Dash calls “V.C. QAnon.”

So where does cryptocurrency come in? Underlying the whole crypto phenomenon is the belief by some tech types that they can invent a better monetary system than the one we currently have, all without talking to any monetary experts or learning any monetary history. Indeed, there’s a widespread belief that the generations-old system of fiat money issued by governments is a Ponzi scheme that will collapse into hyperinflation any day now. Hence, for example, Jack Dorsey’s 2021 declaration that “hyperinflation will change everything. It’s happening.”

Now, I’m quite willing to admit that monetary economics isn’t as solid a science as epidemiology or climatology. And yes, even noncrank economists argue about some big issues much more than their hard-science counterparts.

But economics nonetheless is, as John Maynard Keynes wrote, “a technical and difficult subject” — one on which you shouldn’t make pronouncements without studying quite a lot of theory and history — although “no one will believe it.” Certainly people who think they understand climate better than climatologists and vaccines better than epidemiologists are also likely to think they understand money better than economists and to believe in each case that experts telling them that the world doesn’t work the way they think it does are engaged in some kind of hoax or conspiracy.

He adds near the end:

Thanks to the tech boom, there are probably more wealthy cranks than there used to be, and they’re wealthier than ever, too. They also have a more receptive audience in the form of a Republican Party whose confidence in the scientific community has collapsed since the mid-2000s.

All sounds like a good enough explanation.

Permanently wrong

Wow.  Look at all the examples Jonathan Chait has quickly provided about the wrong predictions of Larry Kudlow.   The article opens:

A dozen years ago, I wrote a book about the unshakable grip of supply-side economics upon the Republican Party. Supply-side economics is not merely a generalized preference for small government with low taxes, but a commitment to the cause of low taxes, particularly for high earners, that borders on theological. In the time that has passed since then, that grip has not weakened at all. The appointment of Lawrence Kudlow as head of the National Economic Council indicates how firmly supply-siders control Republican economic policy, and how little impact years of failed analysis have had upon their place of power.

The Republican stance on taxes, like its position on climate change (fake) and national health insurance (against it), is unique among right-of-center parties in the industrialized world. Republicans oppose higher taxes everywhere and always, at every level of government. In 2012, every Republican presidential candidate, including moderate Jon Huntsman, indicated they would oppose accepting even a dollar of higher taxes in return for $10 dollars of spending cuts. They likewise believe tax cuts are the necessary tonic for every economic circumstance.

The purest supply-siders, like Kudlow, go further and deeper in their commitment. Kudlow attributes every positive economic indicator to lower taxes, and every piece of negative news to higher taxes. While that sounds absurd, it is the consistent theme he has maintained throughout his career as a prognosticator. It’s not even a complex form of kookery, if you recognize the pattern. It’s a very simple and blunt kind of kookery.

 Yes, it is a faith, and one in which incorrect predictions are never, ever cause for revising the belief.   (The reason being, as I only realised relatively recently, that there is always so much going on in the world that can contribute to economic outcomes, there's a permanently moving feast of  information that can be twisted to make some kind of excuse for failed prediction.   Thus it's never the theory that's at fault.   And yet, ironically, it's typically the same supply side believers who claim - completely without merit - that climate change is a case of "unfalsifiable" science.)   

I see that Krugman has re-tweeted DeLong's take:

Larry Kudlow has not been an economist in at least a generation. Rather, he plays an economist on TV. Whatever ability he once had to make or analyze or present coherent and data-based economic arguments is long gone—with a number of his old friends blaming long-term consequences of severe and prolonged drug addiction.

The right way to view this appointment is, I think, as if Donald Trump were to name William Shatner to command the Navy's 7th Fleet.

That said, probably little damage will be done. The major day-to-day job of the NEC Chair is to coordinate the presentation of economic policy options to the President, and to try to keep the agencies and departments on the same page as they implement policy. Kudlow has negative talents in either organizing and presenting alternative points of view or in controlling bureaucracies. Therefore the agencies will each continue marching to its different drummer, and there will be no coherent presentation of policy options to the President. But that will not be new.

And yet JC from Catallaxy, who doesn't seem to bother making snark comments here much anymore, thinks he's a great choice.    Yeah, sure.   

Paid to condescend

Surely I can't be the only person who's finding the outright bitchiness of Judith Sloan towards economists (or economics writers) she disagrees with to be so unprofessional that it's pretty funny.

Her total disdain towards Joe Stiglitz, which she seemingly chose to keep covered up until she was sitting on the QandA panel with him last week is today given full flight in The Australian.  (I assume he has flown out of the country?)  

First, she spends a fair amount of time telling us how we shouldn't be so impressed with economists just because they won a Nobel prize.   (Just a little bit jealous about the attention prize winners get, Judith?)

Then it's the use of "pal" that's dripping with condescension:

Here’s a tip, pal: there is no evidence Abbott thinks that the American model, whatever that might mean, should be emulated. In fact, Americans should be asking us for advice. After all, we are entering our 23rd year of continuous economic growth, per capita income has grown strongly and unemployment is lower than in the US.

Winging his way around Australia, the Nobel-winning evangelist hardly drew breath while spreading the gospel about the many evil aspects of his country, including its universities, its healthcare system and its financial sector. He pleaded with us not to follow suit. Here’s another tip, pal: we are not about to become America anytime soon.

Well isn't that just a bit bizarre - a labour economist (I'll come to that later) who blogs at a libertarian site which routinely supports American libertarian and Republican ideas regarding the importance of low minimum wages, deregulation of just about everything, and ignoring climate change as not happening is telling an American economist to come and copy our ideas?   (And who was that woman in the audience at QandA who took the same line with Stiglitz - a friend of Judith's, or at least a member of the IPA, I'd be prepared to take a wager on that.)


I don't have a problem with Sloan running a line like "let's not exaggerate and say that the Abbott changes will result in something identical to the American system."   But at the same time, she can't credibly deny that on the scale between existing Australian ways of doing health, education, welfare and climate policy (for example), and the American approaches to those matters of government,  there is no doubt that  Abbott  is moving the country much closer to the American end of the scale.   (I would say that the biggest difference between the countries will remain in health, but the "big bang" change to full university fee deregulation is a move most people have already worked out is getting too close to the American system.)  

There was no need for Sloan's condescension in the debate, and if she is going to only deal with economists not in complete agreement with her by considering them fools, perhaps she should give up the pocket money she makes from writing for a national newspaper.

The other funny thing she wrote recently was at Catallaxy, where she opens a post disagreeing with a column Ross Gittens wrote:

Actually, Ross, the debate on the minimum wage has come and gone and Gittins is the one looking the goose.  And here’s the thing: I am a labour market economist and you are not.

 Ha!   

She then spends time telling us what the state of play is regarding certain labour economics ideas.   Yet Matt Cowgill, in a post in which he refrains from using the word "bitchy," explains that we have good reason to be skeptical of Judith's explanation of the state of play amongst "labour economists" on at least one issue.

The funniest thing by way of understatement happens in comments to Cowgill's post:

In my opinion, Judith is someone who perhaps allows her political ideology to overly influence her economic perspective. I wonder if, as a result, she’s not open minded enough to evidence that might conflict with her preconceived views.

Perhaps? !!   Ahahahaha.   There is no "perhaps" about it.

The Gaffe-tastic Mr Romney

I didn't really think much about Mr Romney before this election campaign.  As a moderate Republican governor who reformed health care and seemed to say the right things about climate change, I thought he might be OK in a head to head with a President who has, basically, had to learn on the job.

But really, who knew he could be so incredibly gaffe-tastic?  Not just when talking to the media (dissing England, sounding silly on Russia, jumping in too early on Muslim ) but put him behind closed doors and what the insults to half the US population fly.

There's so much commentary on how stupid his comments make him sound, it's hard to pick a favourite.  David Brooks in the NYT with "Thurston Howell Romney" was pretty good.  His concluding paragraphs are generous:

 Sure, there are some government programs that cultivate patterns of dependency in some people. I’d put federal disability payments and unemployment insurance in this category. But, as a description of America today, Romney’s comment is a country-club fantasy. It’s what self-satisfied millionaires say to each other. It reinforces every negative view people have about Romney.

Personally, I think he’s a kind, decent man who says stupid things because he is pretending to be something he is not — some sort of cartoonish government-hater. But it scarcely matters. He’s running a depressingly inept presidential campaign. Mr. Romney, your entitlement reform ideas are essential, but when will the incompetence stop?

And I guess this is consistent with a piece in Bloomberg yesterday.  The problem might not be Romney per se, but the way his Party has become entrenched in simplistic ideology to the extent they have stopped making sense and don't care about things like (as Bill Clinton said) arithmetic or (as I say) other evidence on something like climate change:

Most of Romney's troubles stem from his inability to shed a broad range of toxic Republican dogmas. The rhetorical and policy workarounds required for him to be both a loyal Republican and a viable candidate for the presidency have stretched him thin and pretzelly.

Why is Romney unable to discuss health care policy -- his most significant government success -- with any coherence or conviction? Because Republicans told their base that Obamacare was the devil's spawn and Romney (who originated the role of the devil in this theater of the absurd) must maintain the fiction.

Why is the most salient aspect of Romney's budget the gaping hole at its center? Because contemporary Republicans like to play fantasy league politics, in which vast swaths of government are magically excised by a legion of Randian Harry Potters. Voters, however, lack a similar imagination. If they saw real numbers signifying real cuts, they would punish Romney. So the numbers stay hidden and Romney's rhetoric and budget documents appear untrustworthy.

Why must Romney, a multimillionaire, push for highly unpopular tax cuts for the wealthy in an era of guilded inequality? Because his base demands it. If such cuts are bad economics (see the Bush administration, 2001-2009), bad fiscal policy (ditto) and unpopular with the broad electorate, so what? The Republican nominee must support tax cuts for the wealthiest -- no matter how much it costs him in credibility or votes.

The list goes on and on. Indeed, Romney's ill-fated foreign policy attack this week may be derived from the same impulse to appease the fantasies that have taken root in the Republican base, which clings to its belief that Obama is anti-American and vaguely in cahoots with terrorists (though presumably not the ones he has had assassinated).

Romney was a fairly successful governor who made a valuable breakthrough in an extremely complex policy arena: health care. His particular brand of business success would probably not be an unmitigated political boon under any circumstances. But any positive political effects have been buried amid Republican protests that the very wealthiest require additional tax breaks and the poorest need more "skin in the game."

But then again, maybe it is Romney after all.

A Pope Benedict explanation

Pope Benedict’s resignation: Why the pontiff failed to complete his reforms of a wounded Catholic Church. - Slate Magazine

Despite his pre-Papal reputation as an enforcer for rigid orthodoxy,  at the time he was made Pope, I remember Paul Collins saying that he was a more conciliatory figure between the liberals and conservatives in the Church than people realised.

The article above from Slate really confirms this:  pointing out that nearly all of Ratzinger's time in the Church during and since Vatican II has been concerned with this unresolved issue of how the Church responds to "modernity", and has been about trying to find a middle way.

It is well worth reading.

I found Pope Benedict a much more likeable Pope than I expected.   Sure, he's stuck on views on reproduction, contraception and sexuality which have rapidly changed in the laity he leads, but there were signs even there that he saw nuance, with his recent comment regarding condom use.  He specifically supported international action on environmental issues including, of course, the key one of greenhouse gases.  I think he made statements consistent with the Church's general concern about unfettered free markets hurting people.  (Which probably fell on deaf ears with the American Catholic Republican dills who think Ayn Rand had something useful to tell them.)  He even made a sort of semi approving statement regarding Teilhard de Chardin, who I think will prove to be an important figure in a re-framing of Catholic thought and theology as response to evolution.  (At its heart, I think the Catholic issue with "modernity" does come down to the unresolved issue of how the revolution in the scientific understanding of the universe and biology affects the doctrine of Original Sin, with knock on effects for the New Testament and subsequent Church understanding of the role of Jesus.)

So there was quite a lot to like, really.

The task of the new Pope will be extraordinarily hard.  The truth is, if you do allow all liberal and progressive elements to have their way under the umbrella of the Church, they can end up talking themselves into nonsense positions, such as saying it doesn't even matter whether Jesus really existed.  (See my old posts on what happened with St Mary's Church at South Brisbane.)  Weaving a way between giving conscience and woolly spirituality full sway on the one hand, while having a belief community that shares common values and understandings of why they join together on the other, is not an easy job....

Update:  further support for the "Pope Benedict was more liberal than you thought" position is to be found in this article at Salon.  I'll quote their section on economics in particular:

In countless speeches and letters, Benedict expressed an economic ethic that Fox News would label socialistic. In just that one address to the diplomatic corps, for instance, Benedict stressed the importance of universal education; the need for “new rules” stressing ethics over balance sheets to govern the global financial system; and the importance of fighting climate change in tandem with global poverty.

Sure, he phrased these views in terms of general principles rather than specific policy demands, and they happen to be very much in keeping with the long history of Catholic social teaching. But they were, all the same, not exactly a consensus view for an international Catholic audience that includes millions of people living in countries that do not educate girls. And they are certainly not a consensus view in places, like the U.S., where religious traditionalism has made common cause with laissez-faire economics to a much greater degree than it has in Benedict’s Germany.

John Paul II won the love of American conservatives through his Cold War alliance with Ronald Reagan; Benedict, coming to the papacy during the Bush years, played a rather different tune on issues dear to the right, from preventive war to unrestrained markets. “In many respects, democratic socialism was and is close to Catholic social doctrine,” he wrote just before his papacy, “and has in any case made a remarkable contribution to the formation of a social consciousness.”

A bit nutty, Jason

Jason Soon keeps noting things said by Nassim Taleb, including re-tweeting extracts of an interview with him that have appeared at Zerohedge.

As far as I can tell, he has a general reputation of being a bit of a loudmouth quasi-contrarian, but with some basic credibility behind him.   He seems, for example, to be on the right side of climate change, arguing that the potential for disastrous temperature rise really means that action should be taken, and those to the contrary bear the burden of proving their do-nothing position.

And on economics, I have the feeling he might be more or less right (if you ignore the personal sledging of Obama) that the economic problems are not really solved:  

Oh, absolutely! The last crisis [2008] hasn’t ended yet because they just delayed it. [Barack] Obama is an actor. He looks good, he raises good children, he is respectable. But he didn’t fix the economic system, he put novocaine [local anaesthetic] in the system. He delayed the problem by working with the bankers whom he should have prosecuted. And now we have double the deficit, adjusted for GDP, to create six million jobs, with a massive debt and the system isn’t cured. We retained zero interest rates, and that hasn’t helped. Basically we shifted the problem from the private corporates to the government in the U.S. So, the system remains very fragile.

So, he worries about "massive debt".   But things start looking wonky in the second part, when he is asked how the Trump administration can address this:

Of course. The whole mandate he got was because he understood the economic problems. People don’t realise that Obama created inequalities when he distorted the system. You can only get rich if you have assets. What Trump is doing is put some kind of business sense in the system. You don’t have to be a genius to see what’s wrong. Instead of Trump being elected, if you went to the local souk [bazaar] in Aleppo and brought one of the retail shop owners, he would do the same thing Trump is doing. Like making a call to Boeing and asking why are we paying so much.

OK, he's stop making any sense. So, Taleb is giving Trump for being a non-expert who talks at a level people can understand.   The problem is - he's ignoring Trump's actual, and plain to see, ignorance on a swathe of economic and other problems, and on those matters where you can tell his general direction, Trump's approach (lower taxes, big infrastructure spend, Mexican wall, the EPA) is only going to make  matters Taleb complains about ("massive debt", climate change) worse.  Not to mention that the path Trump is taking is to decrease banking regulation - no sense of a banker punishment there;  quite the opposite.

As for Trump putting "business sense" into the system - Trump proudly pays no tax and brags about using debt to his advantage, and the string of litigation against his business conduct is embarrassing.

So yeah, sorry, but I have trouble taking Taleb seriously. 

McKibben formula

Economist Warwick McKibben talks about the various solutions he sees for the economic problems of Europe, the USA and Australia.

I do not know his general reputation, even though I have heard of him before. His recommendations appear to me to not spring from a set ideological view.

Yet, in a sign that Andrew Bolt has been taking all his cues from Catallaxy lately, his post on McKibben's story starts with "Keynesian economics is a bust."

Andrew is set to become as certain on economics as he is on climate change; in both cases, by listening to only one ideologically blinkered side of a complicated field.