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Libertarian Thread # 3: Liberty will never die

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    Posted: 5 hours 48 minutes ago at 07:30
lol @ gold bug.  Indeed, Erin Ade, the host of Boom Bust, once asked Jim Rogers if a good time to buy gold would be "when Peter Schiff gives up on gold". LOL  Yeah, looks like he earned his proverbial 15 min of fame when he predicted the meltdown but he has been wrong on so many other things that there's a whole youtube channel dedicated to his gaffes called, appropriately, Peter Schitt. LOL
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Post Options Post Options   Thanks (0) Thanks(0)   Quote JJLehto Quote  Post ReplyReply Direct Link To This Post Posted: 9 hours 40 minutes ago at 03:38
Agreed, I've not seen tons of Russia Today but what I have was very impressive. 
In fact I found it through Steve Keen indeed LOL and a few other of the economist I like have appeared on there. They must have diverse viewpoints represented Smile because I've seen lots of Michael Hudson on RT and he is one crazy dude. Like, talks of us becoming a neo feudal state, parasitic bankers and just burning vitriol about the failures of todays strand of market capitalism. 



Schiff. Yeah, like many I was lured to the Austrian world after realizing he called the crisis years before it happened and had the nerve to say "this is a bubble" but unlike many I turned, or ran, away from him after realizing everything he said after was wrong. 
Not just wrong, but as I learned more econ beyond the layman level I realized much of what he said isn't really accurate.
Ultimately, he seems to just be a goldbug and I think may just be a stopped clock (a dead clock whose hands are stuck perpetually at 5:00 PM will still be "right" every time 5 PM rolls aroundLOL) and he's too biased...not real economics per se, but just typical Austrianism, catering to his anti government/fed views. Even if one gives credit to Schiff for calling our last crisis, he and his ilk have been dead wrong since (hyperinflation, death of the dollar, soaring int rates) and I wonder if he'll keep pushing "Just wait. It is coming, sometime." until the next recession hits then can claim "aha I told you!"

As I've stated here many times, the "post Keynesians" also called our crisis, some stated so as far back as 2002!! And they have a very strong argument behind it, more than "government sucks" and they also were right about their predictions of stagnation, fighting off deflation, the Eurozone, QE, austerity, the US dollar, int rates and etc 


I will be fair, while I think his logic isn't quite right Schiff did indeed call the 2000s bubble, and is right this stock market boom is another bubble purely fed by QE, and I'd say he's right the economy is still not strong and "QE may never raise rates" seems hyperbolic but he is right, the pressure is immense to keep the QE going and rates near 0. We already discussed the political ramification of QE, ironically the people Schiff serves: wealthy and investors, who benefit greatly. The Fed also does have an obsession, which I can get, with keeping the stock market up. QE, I imagine, will have it tumble. Hell, even implying QE may be tapered led to swings, it's a tough situation. 




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Post Options Post Options   Thanks (0) Thanks(0)   Quote rogerthat Quote  Post ReplyReply Direct Link To This Post Posted: 13 hours 32 minutes ago at 23:46
Not really a huge fan of Schiff, by the by.  He's right on a lot of things and wrong on a lot of others, just like a lot of other people, I suppose.
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Post Options Post Options   Thanks (0) Thanks(0)   Quote rogerthat Quote  Post ReplyReply Direct Link To This Post Posted: 13 hours 52 minutes ago at 23:26
Not totally related to the thread, but I've been watching Russia Today lately, particularly Boom Bust, and am surprised by the quality of its programming.  For a state sponsored channel, it is positively awesome and surprisingly capitalist in its economic views.  I used to think it was a bit too libertarian but I've realised it's not necessarily so, and they've had Steve Keen tear apart austerity hawks on the show.  

Peter Schiff gave a particularly caustic interview to the show, where he pooh poohed the notion that Fed would raise rates anytime soon, if ever!  His last thoughts on HP's bizarre decision to simultaneously sack thousands of staff and also buy back its shares had me thinking about the pros and cons of ESOPs.  I think that it ultimately only promotes short termism where the professional exec is only interested in trading on the share price and would rather avoid tough strategidecisions.  Maybe a Goldman Sachs like arrangement where the exec takes a share in both the profit as well as the loss is better, if at all it is desired that he should 'participate in the financial performance of the company.  It would appear that many American giants have lost their way these last few years, concerning themselves more with cost cutting and managing the share price.  And who does that affect but ordinary people who are either on their rolls or who ultimately depend on the well being of these companies.  

Posting the link here.  Embedding doesn't seem to work on chrome for some reason, only on this website.  

https://www.youtube.com/watch?v=u0-wQASGZMc
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Post Options Post Options   Thanks (0) Thanks(0)   Quote JJLehto Quote  Post ReplyReply Direct Link To This Post Posted: April 13 2015 at 13:25
Oh I see. And I have heard people saying the same thing, just it's not usually at the mainstream level...I figured it was just out of their thought process or too scandalous to talk about. 
It can't truly be known if this was the intent or not, but I don't think the results can be denied. 

Yeah it's just a crazy world these days. I do get that argument for smaller gov but I think it's just a matter of reality vs theory. Anything can work, but will it? All depends on how things are done. Like I said I remember the article about US states competing with each other, offering quite grand packages, to lure BMW and Mercedes plants to their city. Or how there's always pressure to suppress various things to lure business. 
On the flip side, one could do as you said: Just deal with the cards as they fall and adjust in different ways, like simply shifting to more "green friendly" business and etc or higher wages. I know the nordic countries, as well as Switzerland and some others are very open trade, and function well and in ways better than here. 
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Post Options Post Options   Thanks (0) Thanks(0)   Quote rogerthat Quote  Post ReplyReply Direct Link To This Post Posted: April 10 2015 at 04:45
Yeah, exactly, govts should occupy themselves with regulation and enforcement rather than intervention. Unfortunately calling the bluff on MNCs goes against the current dogma of 'friendly' tax regimes. In that sense I understand and support the libertarian bias for smaller govt. Not so much small by way of getting out of many areas but simply smaller sized units. Large countries broken up, large states broken into smaller states. It may at least revive grassroots politics. The present Tv driven format of elections ensures that the biggest corporate sellout wins.
 
As for QE, Stephen Roach was on air on Bloomberg the other day saying QE only benefits the rich. Couldn't catch his arguments though; it was at the office canteen and volume was turned off.
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Post Options Post Options   Thanks (0) Thanks(0)   Quote JJLehto Quote  Post ReplyReply Direct Link To This Post Posted: April 09 2015 at 13:37
As for globalization, I dont think anyone seriously thinks it as altruistic but it does indeed bring jobs and better lives to certain areas. Even if to better their profits as the bottom line for the owners.

I more or less agree, I think part of it all is ideological and part of it is "redistribution upward" and a purposeful attempt to do so. Really I increasingly wonder if just the textbook is either a bit archaic given todays world, or a bit incorrect in its implementation/unintended consequences. I DO think part of it is has been a purposeful move to benefit the top, to suppress wages, keep unemployment a bit higher, keep labor weak and I only think this because mainstream economics agrees all this is good, even if they dont say it directly (except Greenspan) 

I also take a dark view on "being competitive" because  I take that to mean: lower wages. Germany has proven the textbooks are right in some fashion: If you get wages low enough you will create employment and exports. Maybe the world will reach balance once we're at a global low level but is that ideal?
And I know comparative advantage and all that says wages wont equalize, there will always be higher wage sectors and etc but with intl competition now involving management, IT, healthcare, engineers and math and science...I think it just will drive the inequality gap more and more.  
So yeah I'll agree with Roger, there could be policies to counter this all. I'm for free trade and globalization, as long as each country still has their own say and as he said "let the cards fall where they will" and counter the impacts. I think my problem is  the accepting globalization while also accepting we should slash gov...because now we're taking whatever the markets give us and I don't think its been beneficial to most. 

I could be wrong, Ive only done undergrad level but do the textbooks really discuss having factories in Bangladesh, moving the profits through a shell Irish company, stuffing the wealth in a Luxembourg bank while the US HQ can hire extremely well qualified people from overseas who'll work for less always? Or if not simply possess insane amounts of skill? There needs to be more gov, not less, to balance these pressures imho and the fact MNCs can basically win-win-win without taking a loss ever people and govs see little benefit from it, unless you're Ireland or Luxembourg who house the banks and shell companiesLOL



Edited by JJLehto - April 09 2015 at 13:57
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Post Options Post Options   Thanks (0) Thanks(0)   Quote JJLehto Quote  Post ReplyReply Direct Link To This Post Posted: April 09 2015 at 13:33
No doubt technology plays a role, skill biased technological change I believe (?) and actually  I did accidentally run this off the rails Embarrassed  didn't mean for it to become the main point, I'm pretty OK with that type stuff: more education and technology driving more wealth and etc   And I even agree with Roger the reality has been worse than the theory and it could be countered with better policy 


My original point was just the role of capital and capital owners seems to have become pre great depression levels but in a way worse since, at the risk of sounding conservativeWink, various "stability" policies just keep wealth afloat and not turning over. Thus the whole QE thing being really one massive bailout imho and I think that is something that is never spoken about, (maybe not even realized). It and it's impacts have had near 0 benefit for most of us, but a boon for the top and I do question how much of it is sincere or just more of the same. I mean OWS became so huge, Piketty and this talk of inequality and capital but no one realizes/speaks how wealth has rebounded and then some thanks to QE or the "Greespan Put" of never letting anything go wrong ever, and never letting asset prices fall. Ideology or boon for the capital class and its benefactors? 


Edited by JJLehto - April 09 2015 at 13:54
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Post Options Post Options   Thanks (0) Thanks(0)   Quote Blacksword Quote  Post ReplyReply Direct Link To This Post Posted: April 09 2015 at 07:21
There is a clear move away from national protectionism with initiatives like the TTIP and the TTP, which will allow corporations to ride roughshod over governments and to even sue governments if they attempt to block private corporations trying to buy up public owned assets.

The TTIP is an EU/US initiative, which the British Labour Party has said it will only sign up to if the British health service is expempt from being bought up by the likes of Google or Lockhead Martin, but as we are an EU member state I'm not sure how much negotiating clout we really have on our own. I'd like to see Labour actually opposing it, but to not sign up to it would mean withdrawel from the EU and that's not what Labour stand for.

I'm sorry to sound like a conspiracy theorist but sometimes you have to see things as they actually are and not how they are reported. The TTIP is demonstrably and obviously of no benefit to you and I, and is clearly another move to globalise our economies further and to consolidate wealth in the hands of the very few. I'm surprised and slightly disappointed that some folk don't see it. It doesn't help that the media is so quiet about it. That in itself should set alarm bells ringing.

It's a shame because it affects the future of everyones children. It'll ultimately mean the Amercian dream of private property owenership and economic independence will have to be re-appraised and going forward we will all have to settle for a lot less than we're used to. They'll tell us it's "for the planet" but sadly it will really be for "them"

IMO..
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Post Options Post Options   Thanks (0) Thanks(0)   Quote rogerthat Quote  Post ReplyReply Direct Link To This Post Posted: April 08 2015 at 19:40
I think wage flattening is also very  much a technological effect, with the Information Age tools themselves overcoming regulatory barriers, often flouting them with alacrity.  Sometimes it seems to be justified too.  Wholesalers and intermediaries here collude with politicians to hold consumers to ransom, hiking prices of vegetables at the slightest whiff of rain or lack thereof and refusing to bring them down even when there is a good harvest.  But with India's largest ecommerce provider flipkart throwing its hat into the groceries space, these guys may just get screwed.  There are already other ecommerce operators in groceries but they were content to make decent margins on their sales.  flipkart has a lot of equity to burn and will disrupt the market place with its pricing.  In one shot, it may very well achieve what successive govts promised and failed to - break the back of cartelisation among the intermediaries.  So in a nutshell, when somebody thinks he can play the game real smart and con people in broad daylight forever, the market harnesses technology to come up with alternative solutions.  I have expressed my concerns over free trade earlier in the discussion.  But if free trade has indeed become so popular, it is possibly also a symptom of the malaise - that of govts not handling trade policy with reasonableness.  
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Post Options Post Options   Thanks (0) Thanks(0)   Quote Blacksword Quote  Post ReplyReply Direct Link To This Post Posted: April 08 2015 at 07:35
Such a complex debate, and a situation that will not have a positive outcome imo.

Globalisation will only benefit a relatively small number of people in the long run. It's not some philanthropic endeavor to bring paid work to the developing world. It's a means of maximising profits by minimising overheads. Thats it. That's all.

Corporations answer to their shareholders and lean on the political class to legislate in their favour, to ensure their relationship with shareholders stands a better chance of renaining intact.

In a globalised economy you may ultimately end up with a form of global communism - only with corporations in charge and not governments, in the sense that a degree of wage equality will eventually settle across the working world. The free movement of labour allows people to emmigrate from poor countries to wealthy countries where employers can afford to pay lower wages to those for whom minimum wage jobs are a godsend compared to what they're used to back home. The result is a drop in wages across the board for everyone, and a lowering of living standards, but a maximising of income for the very wealthy who run those corporations. So although the income spread across the general working population becomes more even, the gulf between the richest and poorest grows ever wider. I was under the impression people were upset about that, but ironically it appears to be so called "liberals" or perhaps "neo liberals" who are most in favour of this arrangement because they unquestioningly support the prinicple of free movement of labour at whatever overall cost.

That's my perception anyway.
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Post Options Post Options   Thanks (0) Thanks(0)   Quote JJLehto Quote  Post ReplyReply Direct Link To This Post Posted: April 06 2015 at 11:28
This is very true. And I guess when I think about, there are people who do come here, leaving their families behind, to work. 
Really, I don't (and no one can) deny the global benefit...I just look at it through a US lens. Not being of the capitalist class,  I say it's not unjustified to view it via country benefit and not globalTongue 

Yeah that is all fair. It's why I more or less endorse very pro labor policies and let the cards fall where they do in regards to the rest. Only so much can be done anyway, especially today where a MNC can have its factories in Vietnam but run its profits through a shell company in Ireland and stash the money in a Luxembourg bankLOL Unless truly global rules and standards are adopted, and I dont see this happening, I guess it is what it is. There will be collusion and countries will compete or bend rules to attract companies. Be it exchange rate manipulation, lax enviro standards/working conditions, low wages, or basically paying the company to move there. 

Probably easier to simply let it all happen and counter these measures. Or as you say, pursue whatever policy you want, (like environmental) and devise programs to offshoot whatever job/income loss comes. Does seem to me the free market crowd is trying to win an impossible battle, I just don't see the US, Western/Central Europe etc "winning" the competition over let's say Bangladesh so why keep lowering various standards? I know I'm spoiled...$2/hr, 12 hours a day for 6 days a week is often the best opportunity in some places and they will accept toxic dumping, pollution, poor work standards to get it but I'd rather not see the US devolve into thatLOL
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Post Options Post Options   Thanks (0) Thanks(0)   Quote rogerthat Quote  Post ReplyReply Direct Link To This Post Posted: April 06 2015 at 01:48
While you as an American would not like to move to Vietnam for work, I would bet any number of Vietnamese would jump at the opportunity to work in America. A lot of people here in India would too. Thus lie the fault lines of globalization. First world labour resents outsourcing but opening up trade in emerging markets did also cause home grown firms to shut down and take jobs with them. Now the capitalist may say that is efficient since only the countries with greatest CTA ought to produce a given product. But advancement in healthcare has pushed life expectancy up, not down. Population is growing except in the advanced nations and what happens to the human race if Asia and Africa too start having fewer kids?! Who will capital sell its efficient produce to in such an event, lol. Again, this is really a distortion caused by the collusion of govts and big business. Far better to let each country set its own trade policy and bear the consequences than to force open markets without following through on unintended effects.

Edited by rogerthat - April 06 2015 at 11:13
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Post Options Post Options   Thanks (0) Thanks(0)   Quote JJLehto Quote  Post ReplyReply Direct Link To This Post Posted: April 05 2015 at 20:25
I was gunna say, those conditions you mention aren't really reality. LOL
And not that labor isn't fee to move, in itself, but ya know I can't exactly just up and move to Vietnam. And I'm young and single, imagine if I had a family! 
I just think the pressure it creates on jobs, and especially wages, is negative and this isn't kosher but "being competitive" basically means downward pressure on wages and conditions in general. I think maybe the theory works more in textbooks of the older days where capital wasn't as mobile, (the notorious MNC ha!)ya know, where everything was largely "in country" and not like today how entities shift capital and labor around at ease but within a company itself. I guess you already said it best. Despite the positive results it does bring of course. 

I recall from political economy reading about BMW and Mercedes and how various US states basically competed with each other to offer the best package possible (tax breaks, road repair, even buying land and etc) for them to move a factory there, and IDK maybe that's just how it is but seems the competition thing has gotten a little warped in reality from the theory


Edited by JJLehto - April 05 2015 at 20:37
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Post Options Post Options   Thanks (0) Thanks(0)   Quote rogerthat Quote  Post ReplyReply Direct Link To This Post Posted: April 04 2015 at 21:31
I am overall in favour of free trade.  But only in an environment where there is free movement of labour and no reserve currency or a basket of reserve currencies so that monetary policy is ultimately more market determined.  Otherwise, it's bound to create distortions in the labour market, creating more jobs in one market than it takes from the other.
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Post Options Post Options   Thanks (0) Thanks(0)   Quote JJLehto Quote  Post ReplyReply Direct Link To This Post Posted: April 04 2015 at 10:44
Perhaps! 
I know very well the arguments in support of free trade, globalization, all of it and I know there are some advantages but even I find it hard to totally swallow the results. Here in the states "Outsourcing" has become a word that causes left and right to both spit in anger, and the perpetual lack of job security in so many positions doesnt help. The intl competition I think has brought some negative results and pressures, that need to be countered in some way (prob by gov spending) So I think that could very well be a reason for increasing disengagement. 

And we've discussed the various way this feeling is manifesting in the US and Europe, extreme libertarian/anti gov shifts or dis-integration and xenophobia fueled nationalism
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Post Options Post Options   Thanks (0) Thanks(0)   Quote rogerthat Quote  Post ReplyReply Direct Link To This Post Posted: April 04 2015 at 01:08
There has been talk of capital controls, so it's indeed possible that we will turn the clock back.  With the latest of the WTO stalemates, the stage is set for disparate mega agreements to replace one multi lateral agreement for all trading nations. It is strange that at a time when information technology has created inexorable momentum in favour of greater interdependence, govt policies seem to be headed in the direction of disengagement and protectionism.  Maybe it's because of the monster of anemic job creation unleashed simultaneously along with, once again, weak demand. 
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Post Options Post Options   Thanks (0) Thanks(0)   Quote JJLehto Quote  Post ReplyReply Direct Link To This Post Posted: April 04 2015 at 00:47
Yeah, I hate to use those divisive terms but to basically simplify it, that was my opinions of QE: Another trickle down, top of the ladder bailout program even if that wasn't the original intent. Also I have no proof of this, but my gut really questions the impact (and even if itd be good) of the wealth effect, and ok they get the yield curve flattened, great, why would I as a business owner respond? There's still no demand (aka need for more workersLOL) and why would I make a long term investment knowing at some point those rates will go up? I can't decide if they're out of ideas or it really IS a boon for the "1%" is all. 

Maybe it's just too 'harsh' but I can't believe progressives like Krugman or Stiglitz, or even Piketty, made note of how wealth has rebounded instantly. Call me a free marketerWink but I thought financial crisis and failure was the ultimate key to wealth turnover and prevent an aristocracy from forming. More than tax changes and etc I just think the rise of finance and Fed behavior of never letting anything bad happen, is largely to blame.

That's a great point, the global response does indeed show just that: leftism is dead. Even the UK didn't pursue a gov solution, just more modern ideas like QE. Heck even the US response was quite mild. 
Indeed, as discussed here before I don't think current Keynesian thought is necessarily the best way to go. 
The painful but perhaps better way is to prevent the crises...restrain and regulate, or some have even mentioned capital controls again. I still am interested in the idea of jobs programs though of course it should be well thought out at the local level

But yeah, even a mild liberal response is better than austerity, and Europe should prove this. 


Edited by JJLehto - April 04 2015 at 00:50
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Post Options Post Options   Thanks (0) Thanks(0)   Quote rogerthat Quote  Post ReplyReply Direct Link To This Post Posted: April 03 2015 at 22:49
In effect, the responses to the 2008 crisis suggest that, contrary to what our libertarian friends would say here, leftist economics has been discredited almost permanently in US and Europe.  They did not turn to Keynes when they had the opportunity.  Instead, Europe went with austerity and US and UK preferred QE.  They have tried to somehow work out a solution to the problem that does not involve bringing back govt in a big way.  In 2008 there was harsh criticism of capitalism and speculation as to how the US would respond.  There have since been popular anti-capitalist movements like Occupy Wall Street but it seems govt is firmly against revisiting the Roosevelt-Kennedy era policies.   On the other hand, it would also be remiss to say they were unequivocally wrong in making this choice because Keynesian stimulus didn't work so well in China and India.  China didn't really have much of a need for more highways and more railroads, so they created white elephants with the stimulus.  In India, projects got embroiled in red tape, protests by activists where land needed to be acquired and such so that the money made available for investment never got utilised and instead flowed into real estate, pricing some of the bigger cities possibly out of the market.
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Post Options Post Options   Thanks (0) Thanks(0)   Quote rogerthat Quote  Post ReplyReply Direct Link To This Post Posted: April 03 2015 at 22:43
Yeah, as the BoE article states, QE started out with the aim of moving toxic assets to govt ownership.  The idea then may have been to support banks and prevent them from failing again.  Later on, it seems to have become a means to artificially inflate asset prices in the hope of stimulating economic activity.  As you said, enrich the top 1%.  It would appear then to be a 21st century rehash of trickle down theory in effect.  Hoping that somehow all the property and stock market action would percolate down to the economy.  To some extent, it has in the US and Germany too has seen an uptick post the ECB's version of QE.  But as we discussed earlier, the results would have probably been better had QE also been backed by public investment.  That would have directly created employment and triggered the so called virtuous circle.  

Edited by rogerthat - April 03 2015 at 22:43
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