Travelling today so enjoy the music

I am travelling a lot today – from London to Brussels and then onto Maastricht. I have had some meetings in London and then tonight (Europe time) I will present the Third Joan Muysken Lecture at the University of Maastricht, which honours their foundation professor in macroeconomics (and one of my co-authors). The talk will outline why the Eurozone should be dissolved forthwith. I don’t expect a sympathetic crowd. Tomorrow, I am giving a talk at the University on why mainstream economics has contributed nothing to the advancement of societal well-being. Rather, it has been a blight on progress. I expect a even less than sympathetic audience. Should be fun! I will try to post audio (at least) of these events. But for now … here is some music.
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    Posted in Admin, Music | 2 Comments

    The Weekend Quiz – March 4-5, 201

    Welcome to The Weekend Quiz, which used to be known as the Saturday Quiz! The quiz tests whether you have been paying attention or not to the blogs I post. See how you go with the following questions. Your results are only known to you and no records are retained.
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      Posted in Saturday quiz | 2 Comments

      The Weekend Quiz – March 4-5, 2017 – answers and discussion

      Here are the answers with discussion for this Weekend’s Quiz. The information provided should help you work out why you missed a question or three! If you haven’t already done the Quiz from yesterday then have a go at it before you read the answers. I hope this helps you develop an understanding of modern monetary theory (MMT) and its application to macroeconomic thinking. Comments as usual welcome, especially if I have made an error.
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        Posted in Saturday quiz | 6 Comments

        When progressives become neo-liberals and create a Trump

        When you have a madman sounding, well “presidential” (according to the obsequious US press) what would you expect a Democrat politician to say in response? Yes I am talking about the Democratic response to the speech given by the US President on February 28, 2017 to the joint session of the United States Congress. The last thing I would want is for the response to begin with a report card on how the responder was fiscally responsible because he had achieved fiscal surpluses during the GFC. But then this is the Democratic Party circa 2016 we are talking about. The Party that lost an unlosable election to a showman who is sparing of the truth. This is the Democratic Party that having just lost an election because its candidate was seen as part of the neo-liberal establishment that has brought grief on millions of Americans, decides to replace its administrative head with another neo-liberal corporatist. But this problem is not uniquely American, although Americans do like to think they are unique. All around the world, political parties who should be defending workers and the poor have morphed into right-wing look-a-likes preaching fiscal rectitude (they would do it fairer) and cuts to public services and all the rest of it. They have so let down their natural constituents that real right-wingers preaching hate against immigrants and refugees and the like have seized the political initiative and taking votes from them. Trump is a sort of hybrid of that. Until the Left abandons its notions that fiscal responsibility does not mean running fiscal surpluses as a matter of course, it will continue to lose ground. And, we will all be worse off as a consequence.
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          Posted in Britain, Demise of the Left, Politics, UK Economy, US economy | 27 Comments

          Australia national accounts – return to unstable growth

          Today, the Australian Bureau of Statistics released the – December-quarter 2016 National Accounts data – which showed that real GDP had rose by a strong 1.1 per cent after recording a negative 0.5 per cent outcome in the September-quarter 2016. Annual growth (last four quarters) was 2.4 per cent. The December-quarter result was driven by strong household consumption growth (even as wages growth was negative), public investment and net exports (on the back of a massive shift upwards in the terms of trade). A bright spot was the positive private investment growth. However, I consider the overall outcome to be an unstable situation. Households cannot continue to dominate the growth outcome when wages are flat or falling and the household debt ratio is already at record levels. The decline in the household saving ratio cannot be sustained. Further, public investment is spiky (large public infrastructure projects) and could just as easily turn negative next period. The overall trend in government intent is to cut back its contribution to growth in the coming year. Which means that growth becomes dependent on the swings in the terms of trade, which fluctuate substantially.
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            Posted in National Accounts | 6 Comments

            Gas reservation is not a progressive option despite scandalous profits

            In the September-quarter 2016, Australia recorded negative GDP growth (-0.5 per cent). Over the last two years, employment growth has been flat and over the last 12 months, full-time employment has dived. Underemployment has risen sharply while unemployment remains at elevated levels and participation at depressed levels (meaning hidden unemployment has risen). And over the last four quarters, wages growth in Australia has been at record lows. Sounds bad. Well for some – make that most of us. But yesterday, the ABS shone a light on one cohort of income recipients – capital – profits rose in the December-quarter by 20.1 per cent. What? And wages fell by 0.5 per cent. Phew, I thought there might be some sharing of the spoils going on – you know, the top-end-of-town letting the workers in on the action a bit. This data comes as Australian workers are being shafted by rises in energy prices as a consequence of large companies, many foreign-owned, being given carte blanche to our national energy resources. A major union’s response today has been to call for a gas reservation policy to guarantee domestic supply (which is waning as we export our heads off). Unfortunately, while the call appears to be based on reason – lower prices, guarantees to local industry etc – any move to a domestic reservation policy would slow down the shift to renewables and just shift profits from export to import operations. It is not the sort of regulation that a progressive should support.
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              Posted in Climate change, Labour costs, National Accounts | 11 Comments

              Disgraceful cut in wages for more than a million low-wage workers in Australia

              In case you thought that neo-liberalism had gone and buried its head in shame after all the disasters that it has wrought after several decades of privatisation, outsourcing, pernicious welfare changes, fiscal austerity, out of control banksters, dramatic increases in income and wealth inequality, then Australia’s most recent effort will remind that it is still alive and well and morphing into something more nasty than we have previously seen (in this country). On Thursday (February 23, 2017), the Fair Work Commission, which is the judicial body empowered by the Federal Government to set minimum wages and conditions in all sectors (so-called ‘awards’) determined that the lowest-paid workers in Australia – more than a million of them (in an employed Labour Force of just over 12 million) – were getting too higher wages and incomes. Accordingly, they decided to cut wages – not just the real equivalent but the actual wage rates that these workers earn. The judges (who I guess do not work as a matter of course on Sunday) have fallen prey of this 24/7 greed for more profits and determined that Sunday work no longer justifies the existing penalty rates. Their decision to savagely cut them just means the bosses pocket more profits and workers move closer or into poverty with rising bankrupcties, mortgage and credit card defaults and the rest of it. The decision is a disaster for the lowest-paid (hospitality, retail and cafe) workers in this country and it will feed through to other sectors before long. The Federal government could easily legislate to stop the cuts. It won’t. The trade unions could rebel. They won’t. So it is really left to us – the citizens to do everything we can including boycotts of firms who exploit the decision to proctect the wages of the poor.
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                Posted in Labour costs | 22 Comments

                The Weekend Quiz – February 26-26, 2017 – answers and discussion

                Here are the answers with discussion for this Weekend’s Quiz. The information provided should help you work out why you missed a question or three! If you haven’t already done the Quiz from yesterday then have a go at it before you read the answers. I hope this helps you develop an understanding of modern monetary theory (MMT) and its application to macroeconomic thinking. Comments as usual welcome, especially if I have made an error.
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                  Posted in Saturday quiz | 1 Comment

                  The Weekend Quiz – February 25-26, 2017

                  Welcome to The Weekend Quiz, which used to be known as the Saturday Quiz! The quiz tests whether you have been paying attention or not to the blogs I post. See how you go with the following questions. Your results are only known to you and no records are retained.
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                    Posted in Saturday quiz | 4 Comments

                    Australia’s wage outcomes – a race to the bottom and nowhere

                    Yesterday (February 22, 2017), the Australian Bureau of Statistics released its latest – Wage Price Index, Australia – for the December-quarter 2016. For the fourth consecutive quarter, annual growth in wages has recorded its lowest level since the data series began in the December-quarter 1997. Real wages are barely growing and trailing productivity growth by a long way. The flat wages trend is intensifying the pre-crisis dynamics, which saw private sector credit rather than real wages drive growth in consumption spending. The Australian government, which should be showing leadership, is obsessing about who it can rope into a free trade deal now the US have scuttled the TPP. The lessons have clearly not been learned.
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                      Posted in Labour costs, Labour Force, National Accounts | 8 Comments