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Author Topic: Economists dipping their toes into other fields
Michelle
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posted 08 July 2007 04:27 AM      Profile for Michelle   Author's Homepage     Send New Private Message      Edit/Delete Post  Reply With Quote 
I don't even know why I'm starting this thread, as I know it will turn into a moderating make-work project. But what the heck.

quote:
Before there was “Freakonomics,” before there was “The Tipping Point” or “Blink,” Steven E. Landsburg wrote a regular column for Slate magazine called Everyday Economics. The column started in the summer of 1996 with an article headlined “More Sex Is Safer Sex,” in which Landsburg argued that H.I.V. would spread less quickly if relatively chaste people each took on a few more sexual partners. At a given bar on a given night, he wrote, these disease-free singles would then make the pool of sexually active adults safer. The article was based largely on an academic paper by another economist, Michael Kremer, theorizing that the spread of AIDS could be slowed in England if everybody with fewer than about 2.25 partners got around a bit more.

This research was one of the early examples of the economics profession’s imperialist movement. For the last decade or so, economists have been increasingly poking their fingers into other disciplines, including epidemiology, psychology, sociology, oenology and even football strategy. These economists usually justify their expansionism on two grounds: They say they’re better with numbers than most other researchers and have a richer understanding of how people respond to incentives.

Arrogant as this sounds, there is some truth to it. Besides, the public seems hungry for the kind of real-world social science economists are practicing. “Freakonomics,” by Steven Levitt and Stephen Dubner, has spent more than 100 weeks on the New York Times best-seller list, while Malcolm Gladwell, the author of “The Tipping Point” and “Blink,” has become perhaps the nation’s most popular nonfiction writer by artfully explaining the science behind everyday human interactions.


Possible side effects


From: I've got a fever, and the only prescription is more cowbell. | Registered: May 2001  |  IP: Logged
N.Beltov
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posted 08 July 2007 06:48 AM      Profile for N.Beltov   Author's Homepage     Send New Private Message      Edit/Delete Post  Reply With Quote 
1. Doug Henwood of Left Business Observer does this as well as is worth looking into. He's actually on the left.

Here's a comment from some right-wing drone about Henwood:

quote:
"You're scum...sick and twisted...it's tragic you exist." - former Wall Street Journal executive editor Norman Pearlstine, who has gone on to great things at Time Inc..

If such drones hate Henwood, he must be good.

quote:
Henwood: When I first started this newsletter, I also thought that all "we" needed to do was get the facts out there and the politics would eventually sort themselves out. People were either under- or misinformed, and a "better empiricism," as an old friend of the newsletter once put it, would do the trick. If only life were so simple. It's become clear over the last twenty years (to me, that is) that facts often matter little in politics; that ingrained "common sense" or the eagerness to believe what one wants to believe often takes precedence over rational argument. You can tell people that the U.S. is the most income-polarized society in the First World and that our economic mobility is no greater than Old Europe's—if you get the chance to tell them, that is—and they either won't believe you, or they'll quickly forget what they've just learned. Because, as everybody just knows, class distinctions don't matter in America because we're so fluid, and we're all middle class anyway, except maybe Bill Gates and that troublesome urban underclass.

LBO at 20.

2. The Canadian Communist paper, People's Voice has a regular "Working Class Economics" column which often tries to lift the veil on economic subjects. Other socialist-friendly organizations undoubtedly have similar contributions in their publications. (IS, etc.) In the latest one, the author quotes the CCPA:

quote:
People are being gouged at the pump. Big time. That's the finding of Hugh Mackenzie of the Canadian Centre for Policy Alternatives.

Surging prices of gasoline amount to nothing more than monopoly price fixing. The recent price gouge is about 27 cents/litre in Vancouver, 15 cents/litre in Toronto and 14 cents/litre in Montreal.

The findings were widely reported in the media, but it's only part of the story. The CCPA figures represent price rigging since 2005, but big oil companies have been fixing prices well before then. ...

In a press release, Petro‑Canada argues "retail prices have increased because the commodity prices that retailers pay for refined gasoline have increased significantly."

OK, the price retailers pay has increased. But who do Shell, Esso, Husky, or Petro‑Canada buy their refined gasoline from? They buy it from their own refineries! They charge themselves more, inflate prices (and profits!), and then try to claim that they are victims of rising prices just like you and me.


3. Our own CCPA, that helps rabble and babble, is outstanding. There's an endless wealth of information there that only requires the ability to read a .pdf file and some time to do so.

CCPA

______________________________________

[ 08 July 2007: Message edited by: N.Beltov ]


From: Vancouver Island | Registered: May 2003  |  IP: Logged
Adam T
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posted 08 July 2007 10:51 AM      Profile for Adam T     Send New Private Message      Edit/Delete Post  Reply With Quote 
Economics as a discipline is basically a combination of psychology, sociology and mathematics (statistics and calculus), so it really shouldn't be a surprise that economists would endeavor to study fields other than finance and the economy.

Many core economics concepts such as diminshing returns, incentives, the distinction between the short term and the long term, externalities, network externalities, economies of scale and more also show up in every day living and not just in finance or the economy.

[ 08 July 2007: Message edited by: Adam T ]


From: Richmond B.C | Registered: Nov 2003  |  IP: Logged
Fidel
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posted 08 July 2007 11:14 AM      Profile for Fidel     Send New Private Message      Edit/Delete Post  Reply With Quote 
Well that's good to know. Thanks
From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
N.R.KISSED
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posted 08 July 2007 08:21 PM      Profile for N.R.KISSED     Send New Private Message      Edit/Delete Post  Reply With Quote 
Meglomania and Hubris on the part of economists would explain their desire to tackle subjects that they are clearly clueless about. Economist occupy a position of privilege beyond the capacity of the absurd pseudo science they spout. This is because economics by design supports and propagates the dominant ideology. Economists get all kinds of air time within the mainstream media because they lend credibility to capitalist belief systems. You certainly don't see many economists critiquing capitalism getting any air time.
From: Republic of Parkdale | Registered: Aug 2001  |  IP: Logged
Adam T
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posted 08 July 2007 09:42 PM      Profile for Adam T     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Economist occupy a position of privilege beyond the capacity of the absurd pseudo science they spout.

It's interesting how anti intellectual some people can get.


From: Richmond B.C | Registered: Nov 2003  |  IP: Logged
Tommy_Paine
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posted 09 July 2007 04:48 AM      Profile for Tommy_Paine     Send New Private Message      Edit/Delete Post  Reply With Quote 
It would be interesting to do a research paper on both left and right wing economists, and find out how many actually recomend economic practices that would negatively effect them, personally.

It isn't anti-intellectual to point out that when any expert steps out of his or her field of expertise, then all we are left with are arguments from authority.

Economics an absurd psuedo science? Not in theory, I don't think.

But in practice?


From: The Alley, Behind Montgomery's Tavern | Registered: Apr 2001  |  IP: Logged
Adam T
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posted 09 July 2007 05:22 AM      Profile for Adam T     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Economics an absurd psuedo science? Not in theory, I don't think.

But in practice?


I don't know what you're referring to.


From: Richmond B.C | Registered: Nov 2003  |  IP: Logged
500_Apples
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posted 09 July 2007 06:13 AM      Profile for 500_Apples   Author's Homepage     Send New Private Message      Edit/Delete Post  Reply With Quote 
Lots of people on babble really hate economists.

It kind of reminds me how a lot of right-wingers hate evolutionary biologists and climatologists.

Don't get me started on what I see written from both right and left of evolutionary psychologists.

It kinda of showcases what the quote N. Beltov brought up. When people are presented with coherent arguments which they find ideologically offensive, they turn to anger.


From: Montreal, Quebec | Registered: Jun 2006  |  IP: Logged
N.R.KISSED
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posted 09 July 2007 06:26 AM      Profile for N.R.KISSED     Send New Private Message      Edit/Delete Post  Reply With Quote 
To be a science a discipline needs discrete independent variables to study, economics does not have this. Economics claims to be studying human behaviour but rarely actually references observable behaviours, instead economics creates social constructs that they claim represent the underlying behaviours that they never actually examine. The result is that economic constructs and the mathematical models they formulate have little connection to reality.

In terms of psychology economics introduces the absurd homo economicus a one dimensional characture that fails to even approximate the complexity of human behaviour.

In terms of human decision making econimics posits the rational actor, a construct that was demonstratably dismissed by Kahneman and Tversky over 30 years ago, yet economist persist with this faulty assumption as a centrality.

The same holds for social behaviour, economics ignores the complexity of social and cultural behaviour, particularly ignoring issues of power and privilege and its impact on what is considered economic behaviour. What is refered to as economic behaviour is magically considered independent of these forces, and in the rare cases these forces are acknowledged they are ignored.

Lets look at the "law" of supply and demand. It is quite easy to see how supply and demand is influenced by human behaviour. The nature of scientific laws is that they are meant to be independent of human behaviour. Human behaviour is not going to change the laws of thermo dynamics, nor will it chnge the laws of gravity. Only an economist could believe that supply and demand is not manipulated by human behaviour.

that's a start anyway


From: Republic of Parkdale | Registered: Aug 2001  |  IP: Logged
jrootham
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posted 09 July 2007 07:37 AM      Profile for jrootham     Send New Private Message      Edit/Delete Post  Reply With Quote 
There are several critiques of economics held by posters to babble. Unfortunately that one isn't a particularly good one. It's way too simplistic on the use of the word "laws" in scientific exposition.

A common thread among many of the anti economist posters is that economists don't respond to falsification. That is, they build a theory, try it a few times, adopt it, and don't change it when it doesn't fit elsewhere. This critique is not anti intellectual or anti science, it is profoundly intellectual and scientific.


From: Toronto | Registered: Jun 2001  |  IP: Logged
Tommy_Paine
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posted 09 July 2007 07:37 AM      Profile for Tommy_Paine     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Originally posted by Adam T:

I don't know what you're referring to.


As I alluded to at the start of my post, I have rarely ever seen an opinion from an economist that doesn't protect his or her economic standing, or the standing of those funding his or her research.


From: The Alley, Behind Montgomery's Tavern | Registered: Apr 2001  |  IP: Logged
N.R.KISSED
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posted 09 July 2007 07:43 AM      Profile for N.R.KISSED     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
There are several critiques of economics held by posters to babble. Unfortunately that one isn't a particularly good one. It's way too simplistic on the use of the word "laws" in scientific exposition.

I made a number of points if you are unable to respond to even one in a coherent fashion why bother posting.


From: Republic of Parkdale | Registered: Aug 2001  |  IP: Logged
Fidel
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posted 09 July 2007 10:34 AM      Profile for Fidel     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Originally posted by 500_Apples:
Lots of people on babble really hate economists.

It kind of reminds me how a lot of right-wingers hate evolutionary biologists and climatologists.


And it would be a logical extension to say that lots of right-wingers really hate left-wing economists.


From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
500_Apples
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posted 09 July 2007 11:16 AM      Profile for 500_Apples   Author's Homepage     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Originally posted by Fidel:

And it would be a logical extension to say that lots of right-wingers really hate left-wing economists.


Yes, true.

But the more common example is their invective against sociologists.


From: Montreal, Quebec | Registered: Jun 2006  |  IP: Logged
obscurantist
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posted 09 July 2007 11:35 AM      Profile for obscurantist     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Originally posted by 500_Apples:
Don't get me started on what I see written from both right and left of evolutionary psychologists.
Well, if BOTH sides of the political spectrum can actually agree with each other that a particular discipline is full of crap....

I'm just sayin'.


From: an unweeded garden | Registered: Feb 2005  |  IP: Logged
Stephen Gordon
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posted 09 July 2007 12:39 PM      Profile for Stephen Gordon        Edit/Delete Post  Reply With Quote 
quote:
Originally posted by Michelle:
I don't even know why I'm starting this thread, as I know it will turn into a moderating make-work project. But what the heck.

I'm on vacation.


From: . | Registered: Oct 2003  |  IP: Logged
Adam T
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posted 09 July 2007 02:24 PM      Profile for Adam T     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
In terms of human decision making econimics posits the rational actor, a construct that was demonstratably dismissed by Kahneman and Tversky over 30 years ago, yet economist persist with this faulty assumption as a centrality.

I haven't seen their work, but I have seen a lot of research that show almost universally people as a whole acting in ways that concur with economic theory.


quote:
A common thread among many of the anti economist posters is that economists don't respond to falsification. That is, they build a theory, try it a few times, adopt it, and don't change it when it doesn't fit elsewhere

Could you provide some examples of this?

If you look at peer reviewed economic journals you will see full debate as you will in any discipline. Similarily, as in any other discipline, ideas that don't fit the data get discarded.

quote:
It kinda of showcases what the quote N. Beltov brought up. When people are presented with coherent arguments which they find ideologically offensive, they turn to anger.

This is what I observe as well. You said it better than I could.

[ 09 July 2007: Message edited by: Adam T ]


From: Richmond B.C | Registered: Nov 2003  |  IP: Logged
Lard Tunderin' Jeezus
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posted 09 July 2007 02:33 PM      Profile for Lard Tunderin' Jeezus   Author's Homepage     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Originally posted by 500_Apples:
Lots of people on babble really hate economists.

Lots of people on babble really hate ignorant and obtuse generalizations being made about us by people with contempt for the left.
quote:
When people are presented with coherent arguments which they find ideologically offensive, they turn to anger.
Surely this particular observation is based on the arguments of others, as it would be a long stretch to claim coherency for any of yours.

[ 09 July 2007: Message edited by: Lard Tunderin' Jeezus ]


From: ... | Registered: Aug 2001  |  IP: Logged
500_Apples
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posted 09 July 2007 05:25 PM      Profile for 500_Apples   Author's Homepage     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Originally posted by Lard Tunderin' Jeezus:
Lots of people on babble really hate ignorant and obtuse generalizations being made about us by people with contempt for the left.
[ 09 July 2007: Message edited by: Lard Tunderin' Jeezus ]

Lard,

The fact you think I have "contempt for the left" just shows how out of touch you are, and how ridiculous your stalking me around the forum is.


From: Montreal, Quebec | Registered: Jun 2006  |  IP: Logged
Adam T
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posted 09 July 2007 05:39 PM      Profile for Adam T     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Lets look at the "law" of supply and demand. It is quite easy to see how supply and demand is influenced by human behaviour. The nature of scientific laws is that they are meant to be independent of human behaviour. Human behaviour is not going to change the laws of thermo dynamics, nor will it change the laws of gravity. Only an economist could believe that supply and demand is not manipulated by human behaviour.

quote:
To be a science a discipline needs discrete independent variables to study, economics does not have this.

N.R.Kissed is correct that economists rarely have situations where one variable can be changed while everything else is held constant. That said, there are sophisticated statistical tools that help deal with this problem.

However, his first comment makes no sense.

Here is an example: The price of good A rises from $1 to $2 (the independent variable) and demand for it falls from 100 units to 75 units (the dependent variable).

The price of good B rises from $1 to $2 and demand for it falls from 100 units to 50 units.

The change in demand when price changes is known as price elasticity of demand and human behaviour (whether the good is a necessity or not...) and availability of substitutes are two of the main reasons economists use to explain the elasticity.


From: Richmond B.C | Registered: Nov 2003  |  IP: Logged
Fidel
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posted 09 July 2007 06:24 PM      Profile for Fidel     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Originally posted by N.R.KISSED:

In terms of psychology economics introduces the absurd homo economicus a one dimensional characture that fails to even approximate the complexity of human behaviour.

The central character in economics is supposed to be an approximation of all of us. homo economicus is pretty much just a walking set of insatiable material wants. He uses rational abilities to ensure satisfaction of all possible material desires. In economics, homo economicus is the butcher and baker whose self-interests are largely responsible for providing us all with bread and meat. It's a fairly straightforward theory, and any deviation from the model begins to appear implausible and even suspicious.


From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
Stephen Gordon
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posted 11 July 2007 03:00 PM      Profile for Stephen Gordon        Edit/Delete Post  Reply With Quote 
Okay, I'm back home.

The success of Freakonomics has been a bit of a mixed blessing for economists. The good thing is that it shows that economists are interested in a much broader range of questions than non-economists might have thought. The bad thing is that Steve Levitt's work is highly idiosyncratic: it relies heavily on the use of quirky data sets and what we call 'natural experiments'. His work is widely admired, but not much cited. Nor will you find much in there that would give an insight into current debates about policy.

Landsburg is a quite different, and to my mind, a much better read. (I've purchased but not yet read the new book; I'm guessing that it's similar in tone to his Slate columns and his previous book). Landsburg's mission is to explain some basic - but by no means unsubtle - points of economic theory using plain language and everyday situations. My favourite bit from his other book was his introduction to the Winner's Curse: 'Economic theory predicts that you are disappointed with this book.'

eta: Oh yes, the charge of 'imperialism' is hard to understand. After all, economics is the one field where non-specialists are most comfortable in ignoring what specialists have to say.

And it'd be a lot more convincing if it could be shown that an economist's contribution to the subject was without merit; pointing and shrieking 'Eeek - an economist (ptew ptew) has a new take on the issue!' is hardly a convincing rebuttal.

[ 11 July 2007: Message edited by: Stephen Gordon ]


From: . | Registered: Oct 2003  |  IP: Logged
Farmpunk
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posted 11 July 2007 03:38 PM      Profile for Farmpunk     Send New Private Message      Edit/Delete Post  Reply With Quote 
"After all, economics is the one field where non-specialists are most comfortable in ignoring what specialists have to say."

Oh, come on. We're all armchair experts.


From: SW Ontario | Registered: Jul 2006  |  IP: Logged
Stephen Gordon
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posted 11 July 2007 04:03 PM      Profile for Stephen Gordon        Edit/Delete Post  Reply With Quote 
On every subject?
From: . | Registered: Oct 2003  |  IP: Logged
Farmpunk
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posted 11 July 2007 04:58 PM      Profile for Farmpunk     Send New Private Message      Edit/Delete Post  Reply With Quote 
In context, naturally.

I have people tell me what to do, and what I'm doing wrong as a professional, all the time. Occasionally some of the armchair people have a point.

But there are probably just as many economists as farmers in NA now, so what do I know?


From: SW Ontario | Registered: Jul 2006  |  IP: Logged
Fidel
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posted 11 July 2007 11:37 PM      Profile for Fidel     Send New Private Message      Edit/Delete Post  Reply With Quote 
I think what the working class needs is to regain the democratic control of our economies that came about after world wars of the last century. Since the 1970's, we've come full circle back to democratically elected governments claiming they are impotent to act on behalf of the electorate, impotent to do anything other than obey the dictates of market fundamentalism and unbridled capital. It wasn't always this way.

quote:
"We regard those people as leaders who have been able to break out of the existing cast of thought and blaze new trails. That those in power were unable to do so shows that they were poor leaders, not that the task was impossible." - Peter Temin

From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
N.Beltov
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posted 12 July 2007 11:23 PM      Profile for N.Beltov   Author's Homepage     Send New Private Message      Edit/Delete Post  Reply With Quote 
A recent article in the New York Times notes that in "Economics Departments, [there is] a Growing Will to Debate Fundamental Assumptions" ...

NY Times

quote:
For many economists, questioning free-market orthodoxy is akin to expressing a belief in intelligent design at a Darwin convention: Those who doubt the naturally beneficial workings of the market are considered either deluded or crazy. ....
Criticizing the approach that currently dominates the field, Mr. Blinder said economists must look more closely at the real world instead of modeling it in the lab. “Economics is insufficiently scientific,” he said. “Mathematics may be useful, but mathematics is not scientific. It doesn’'t generate refutable hypotheses.”

From: Vancouver Island | Registered: May 2003  |  IP: Logged
Steppenwolf Allende
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posted 13 July 2007 02:36 PM      Profile for Steppenwolf Allende     Send New Private Message      Edit/Delete Post  Reply With Quote 
Beltov wrote:

quote:
Doug Henwood of Left Business Observer does this as well as is worth looking into. He's actually on the left.
Here's a comment from some right-wing drone about Henwood:


quote:
--------------------------------------------------------------------------------
"You're scum...sick and twisted...it's tragic you exist." - former Wall Street Journal executive editor Norman Pearlstine, who has gone on to great things at Time Inc..
--------------------------------------------------------------------------------

If such drones hate Henwood, he must be good.


I haven't actually read much Henwood, but I know the Left Business Observer is a great source for informed and well-researched factual critiques of capitalism of every variety and its institutions in action.

Focus on the Corporation is another great source, as is the CCPA, like you mention. I don't care much for the People's Voice, as it's still partially stuck in a neo-Stalinist hole romanticizing about totally factless "socialism" in the former Eastern Bloc.

I think this relates to why, at least in part, so many people have such a dim view of economics and economists in general—similar to the way we have toard politics and political parties in general. Throughout the 20th century in particular, we have seen all kinds of brutal atrocities, ruthless exploitation and oppression, major wars and dictatorships, austerity and violent suppression of freedoms and human development, ecological destruction on a massive scale and history-setting corruption and crime, all hiding behind slogans and terms that in fact have little or nothing to do with what they have been fraudulently associated with (socialism, communism, democracy, free trade/markets/enterprise, flexibility, etc.).

And just about all of these frauds have been perpetuated by advocates and apologists for various forms of corporate or state monopoly capitalism as economists, or pretending to be economists.

You only need to look at the absolute bullshit being pushed as “economics” by the Fraser Institute and similar ilk (Chicago Business School, American Enterprise Institute, etc.) that outright lie to justify their totalitarian corporatist agendas. These are echoed, as we have seen, by the various Bolshevik/Stalinist/Maoist groups out there again denying fact, ignoring or justifying all sorts of brutality behind the fraudulent slogan of “building socialism.”

All these various types are in the same league as the economists who crunched the numbers to justify the Nazis’ “final solution” or “lebensraum” policies—who have apologized for Apartheid, military dictatorship, brutal austerity measures and political atrocity, endless class privilege and trickle-down stupidity.

It seems economists have become sleazy salespeople and con artists for the scams and schemes of various capitalistic power cliques, instead of instead of actually figuring out how things work and why—justifiers of why things can’t or shouldn’t put the public interest first, instead of developing ways of providing the greatest good for the greatest number.

Obviously, not all economists have bought into this pantheon, as we see by the huge number of dedicated hard-working and principled economists committed to developing ways of democratizing our economy and making it more sustainable and in tune with our environment.

But it appears that over the decades, many of our main economics schools and think tanks have become more the apologists and excuse-mongers for failed and destructive economic policies, than visionaries, free-thinkers and planners for solving real problems.


From: goes far, flies near, to the stars away from here | Registered: Aug 2006  |  IP: Logged
Stephen Gordon
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posted 13 July 2007 02:50 PM      Profile for Stephen Gordon        Edit/Delete Post  Reply With Quote 
Hey, here's a wacky idea: read what economists have to say!

Okay, okay, it's harder work and not nearly as gratifying as inventing fantasies about economists' motives. But if you don't do the reading, you run the risk of being dismissed as anti-intellectual cranks.


From: . | Registered: Oct 2003  |  IP: Logged
Steppenwolf Allende
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posted 13 July 2007 03:40 PM      Profile for Steppenwolf Allende     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Hey, here's a wacky idea: read what economists have to say!
Okay, okay, it's harder work and not nearly as gratifying as inventing fantasies about economists' motives. But if you don't do the reading, you run the risk of being dismissed as anti-intellectual cranks.

Wow, what a devastating defense of the status quo Stephen Gordon. You renew my faith.

Think of it. After years of studying economics, reading economists, practical business experience, economic development projects, etc. which is what has led me to the just-expressed conclusions about the sad state of the economics discipline today, just this one sentence from you has changed my life. My faith is restored! I have found new hope in the light and vision expressed by the great Doctor of Economics Stephen Gordon.

We surely must now begin our fund-raising campaign to establish the Gordon Institution of Visionary economic One-liners.

I will write a letter to Pope Benedict Arnold in Rome. I don’t think there has ever been an economist nominated for Sanctification. I shall not rest, Dr. Gordon, until you are made Saint!

Our Father
Who art in College
Hallowed be thy doctorate

Thy Productivity Report Come
Thy budgetary forecast be done
In the Government as in the Private Sector

Give us this day
Our daily diminishing returns
And forgive us our defaulted loans
As we charge rent to those who trespass on our to-be foreclosed assets

Lead us not into democratic socialism
And deliver us from all free thought and thinking outside the box

For thine is the School
The power of political influence
Forever rising stock value and limitless credit

Amen

[ 13 July 2007: Message edited by: Steppenwolf Allende ]


From: goes far, flies near, to the stars away from here | Registered: Aug 2006  |  IP: Logged
Stephen Gordon
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posted 13 July 2007 05:18 PM      Profile for Stephen Gordon        Edit/Delete Post  Reply With Quote 
If you've studied economics, why are you amusing yourself with paranoid fantasies about economists' motives? Why not discuss what they say?
From: . | Registered: Oct 2003  |  IP: Logged
Fidel
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posted 13 July 2007 05:59 PM      Profile for Fidel     Send New Private Message      Edit/Delete Post  Reply With Quote 
In her book, The Cult of Impotence, Linda McQuaig says Ottawa doesn't have to cower to the dictates of Bay Street bond salesmen and money markets and pretending they are powerless to fund programs spending.

Unlike the period before Bretton Woods, governments now have the ability to pursue policies aimed at full employment and well-funded social programs if they choose to. That is, if they are willing to allow the dollar to drop in exchange rate value for some period of time. Ottawa can have policy autonomy apart from knuckling under to capital, even if capital is fully mobile. This was not true of the period before WWI when money was backed by the gold standard.

Economist Pierre Fortin suggested then that the failure of governments to deliver on these policies is not due to any real powerlessness to defy the dictates of money markets. Linda said, "Thus, what we have now is not real impotence but a self-imposed variety"


From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
Adam T
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posted 14 July 2007 02:42 AM      Profile for Adam T     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
But it appears that over the decades, many of our main economics schools and think tanks have become more the apologists and excuse-mongers for failed and destructive economic policies, than visionaries, free-thinkers and planners for solving real problems.

We seem to have different views of the state of the nation.

"failed and destructive economic policies"????

Such as?

I'm not a pollyana and there are certainly problems, including the growing gap between the rich and poor, but let's be serious.

There has never been as much wealth per person in Canada (or the United States or Western Europe) as there is right now.

Furthermore, in Canada, there has been one recession, lasting for about 8 months, in the last 25 years. There was a slowdown in the early 2000s in Canada, but there was never a recession. Even in the U.S, where there was a recession, that makes 2 recessions in the last 25 years.

Contrast that to 100 years ago when between 1877 and 1911 in the United States there were 11 recessions, including two mini depressions.


On a more nitpicky note

quote:
All these various types are in the same league as the economists who crunched the numbers to justify the Nazis’ “final solution” or “lebensraum” policies—

Actually, most historians would likely argue that it was political geographers and eugenics enthusiasts who were responsible for those ideas.

[ 14 July 2007: Message edited by: Adam T ]

[ 14 July 2007: Message edited by: Adam T ]


From: Richmond B.C | Registered: Nov 2003  |  IP: Logged
Adam T
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posted 14 July 2007 02:52 AM      Profile for Adam T     Send New Private Message      Edit/Delete Post  Reply With Quote 
We could also switch it around. If economists commenting on other fields is a problem (and I don't know that anybody here has really said that it is) then surely there is also a problem the other way: non economists commenting on economics.

As a third year economics student, I have observations on that, and they would also serve as a warning to economists making comments out of their field of expertise.

I've noticed there are a lot of people on the right, who seem to think that because they are on the right, they are somehow economic experts.

What they do is they attempt to apply general economic principles/concepts to specific situations. For instance, many American right wingers will say "we need to keep health care private because they do research into new technologies, and new technologies bring lower costs." (I believe that clown Bill O'Reilly makes that argument). The problem is, is that in this specific field, most health care economics that I've read shows that new technologies tend to result in higher costs.

[ 14 July 2007: Message edited by: Adam T ]


From: Richmond B.C | Registered: Nov 2003  |  IP: Logged
Adam T
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posted 14 July 2007 03:14 AM      Profile for Adam T     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
A recent article in the New York Times notes that in "Economics Departments, [there is] a Growing Will to Debate Fundamental Assumptions" ...

Thanks for that article. My textbook on labour economics includes both a section on the study by Card and Krueger as well as a discussion on neoclassical theory and the main criticisms of it. It is also very heavily statistical and includes a large number of empirical studies.

Mind you, it is a Canadian textbook.

Both Kwantlen University College, which I am presently attending, and Simon Fraser University have courses on environmental economics.


From: Richmond B.C | Registered: Nov 2003  |  IP: Logged
N.Beltov
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posted 14 July 2007 04:09 PM      Profile for N.Beltov   Author's Homepage     Send New Private Message      Edit/Delete Post  Reply With Quote 
Another find: an online Economic webzine with a conscience. Now there's a wacky idea. Check out dollars and sense: The Magazine of Economic Justice.

A sample article available for viewing is this one on "The Real Political Purpose of the ICE Raids". Seems that pressure tactics are being used to get approval of the new reactionary and evil guest worker program. Yea, that's right. Half a loaf of human rights. (If that)

quote:
For the last several months, Immigration and Customs Enforcement (ICE) agents have carried out well publicized raids in factories, meatpacking plants, janitorial services companies, and other workplaces around the country employing immigrants. ICE calls the workers criminals because immigration law forbids employers to hire them. But while workers get deported and often must leave their children with relatives or even strangers, don't expect to see their employers go to jail. ...

Guest worker programs are low-wage schemes, intended to supply plentiful labor to corporate employers at a price they want to pay. According to Rob Rosado, director of legislative affairs for the American Meat Institute, meatpacking companies want a guest worker program, but will not countenance a basic wage guarantee for those workers. "We don't want the government setting wages," he says. "The market determines wages."


The idolatry of the market. Where have I heard those horse droppings before?

The same online webzine also has a piece on the "debate" between orthodox and hererodox economists over the past number of weeks:

The dull compulsion of the Economic

quote:
In the last few weeks an interesting debate has been going on, primarily in the blogosphere, about the relationship between so—called heterodox and orthodox economics. The debate was set off by an article posted by The Nation in which Chistopher Hayes surveyed the history of a relationship characterized for many years by utter dismissiveness on the part of the orthodox towards the rebels ...

The stupidity of methodological individualism, issues in behavioral economics and excessive reliance on mathematical abstractions are all covered, if briefly.

[ 14 July 2007: Message edited by: N.Beltov ]


From: Vancouver Island | Registered: May 2003  |  IP: Logged
Fidel
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posted 14 July 2007 04:35 PM      Profile for Fidel     Send New Private Message      Edit/Delete Post  Reply With Quote 
from N.Beltov's link above:

quote:
Post-secondary education has been shown to be even more effective than the GED in reducing recidivism. James Gilligan, a director of mental health for the Massachusetts prison system and a prison psychiatrist for 25 years, found that a program through which hundreds of people in prison earned a college degree was 100% effective in preventing recidivism.

This is the height of western hypocrisy. A poor man can not pursue higher education while incarcerated, whether he's a petty thief or a murderer. In this case, murder and theft are punished with full force of the law.

But the feds encourage young men and women to join the army with enticements like free post-secondary education among other things. And while serving in the army in another country on the other side of the world, they are encouraged to murder the citizens of that country in the name of freedom and democracy. No capital punishment for those guys, just perks and privileges most other Canadians and Americans do not enjoy, like: taxpayer-funded university or college education, and full dental and medical coverage, and a full pension at the end of it all.


From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
Steppenwolf Allende
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posted 14 July 2007 05:57 PM      Profile for Steppenwolf Allende     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
I'm not a pollyana and there are certainly problems, including the growing gap between the rich and poor, but let's be serious.

There has never been as much wealth per person in Canada (or the United States or Western Europe) as there is right now.


OK, let's be serious. Let's use you statement above as an example of the sad state of economics today. This is by no means an attack on you personally, but just a general observation of the comment you just made in terms of just how bad things have gotten with economics in this country.

"Never been as much wealth per person in Canada (US, Europe) as there is right now" means absolutely diddly squat, and I think you well know that, as the bulk of that wealth is more centralized into fewer hands than ever before, hence contributing to the growing gap between rich and poor, that you acknowledge, and creating poverty, scarcity and insecurity not seen since the Great Depression.

Offering a useless and totally irrelevant to real life stat like “more wealth per person” as something positive or beneficial isn’t economics. It’s outright sophistry and blatant apologism for a rotten economic situation.

You know very well that if that stat was related to reality, in that every person actually had more wealth than ever before, that would mean the economy would likely be far more democratized, the rich-poor dichotomy would be sharply curtailed and there would be much more universal prosperity and equality—including greater opportunity for all.

Instead, today we look at the record-high stifling personal debt loads, record low personal savings, severely eroded retirement security and an overall 25-year falling wage trend compared to the cost of living, worsening overall poverty and homelessness in Canada, and you see that people are overall poorer and worse off than 30 years ago. Even the bloody banks are acknowledging these conditions.

Yet what do most of our corporate-influenced economic schools promoting? The same damaging Neo-Con fiscal monetarist horseshit they have been pushing for the last 25 years—the same economics that have presided over this sickening trend.

It’s interesting in this so-called “boom” how these worsening conditions are actually making people overall poorer. Capitalism of every variety has always been oppressive, destructive and exploitative. But I remember the days when a “boom” meant you were generally better off—able to save money, build a retirement portfolio, pay for your education and actually get ahead of the CPI. Those days have been gone since the mid 70s.

Yet we nothing but down-playing, excuse-mongering and stupid meaningless and misleading stats, like “more wealth per person” or, even worse, “more millionaires” as some false reference to how things are so good and people should feel so happy.

I could go on with more examples, but I think you get my drift on this.


From: goes far, flies near, to the stars away from here | Registered: Aug 2006  |  IP: Logged
Adam T
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posted 14 July 2007 06:35 PM      Profile for Adam T     Send New Private Message      Edit/Delete Post  Reply With Quote 
Steppenwolf Allende, show me specific figures to back up your claims and cite your sources and I will discuss these things with you if you like.

I've heard all of the claims you are making, but it's hard to have a serious discussion without knowing how much they reflect reality.

That is why I cited fairly specific facts like "there is more wealth per capita among Canadians now than ever before in history" (obviously, as I alluded to in my post, that doesn't show how its distributed) and my citing of the near dissapearences of recessions now and what the world was like 100 years ago.

A nonrealistic example of the problem of making claims like you are without quantifying them is this: Let's say you have an economy where 98% of the population are wealthy than ever before but the poorest 2% are poorer than ever before and all you say is "poverty is greater than ever before."

Well, that would obviously be true, but it wouldn't tell the full story. There are over 30 million people in Canada, you can practically anything with that many people and build it up. Always the question that has to be asked is: "how reflective of the country as a whole is it?"

It is only by quantifying these things that you can then have a serious analysis of the trade offs involved in any of the choices available. Some on the left would call that trying to get 'the greatest good for the greatest number'.

[ 14 July 2007: Message edited by: Adam T ]


From: Richmond B.C | Registered: Nov 2003  |  IP: Logged
Steppenwolf Allende
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posted 14 July 2007 10:06 PM      Profile for Steppenwolf Allende     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Steppenwolf Allende, show me specific figures to back up your claims and cite your sources and I will discuss these things with you if you like.

Know what Adam T? I find it somewhat amusing, and a bit irritating, being lectured to back up my claims when that is exactly what I have been doing ever since I joined this site last summer. I do my best to make a point of doing this. The reason why I write what I write is because I have posted links to articles and stat reports, etc., as well as quotes and references on these matters on numerous threads here for months.

Here a few of these for your benefit here:

Canadians are working longer hours for less pay, and that the country's poverty rates are worsening and including more people.

Furthermore, over the last 30 years, working class Canadians appear to be losing earning and spending power compared to the cost of living.

Add to this, personal debt is at an all-time high, thanks to the falling wages-to-CPI ration.

And, conversely, consumer savings (which are mostly working class people) are at record lows.

rising Personal and Consumer Debt

Canadian Labour Congress release real incomes overall continue to slide.

Statistics Canada monthly Labour Force Survey

The New York Times widening US wealth gap.

These are just a tiny set of examples of how the rotten Neo-Con economic policies pushed by corporate-funded parties in this country have driven things down.

Now compare this to how history is chalk full of proof that rising wages, benefits, rights and security from unionization and the usual complimentary even modest social democratic reforms have hugely boosted living standards, vastly improved working conditions, expanded and entrenched democratic rights and strengthened the health, education, equality and prosperity of people.

Report after report after report after report after report show unequivocally that rising wages and working conditions and freedoms brought about by the vast spread of unionization and complimentary New Deal type social reforms fought for by unions effectively, albeit moderately, redistributed great amounts of wealth back to the working people who created it in the first place, and this led to the biggest economic boom and sustained rise in living standards and prosperity in human history--to the point of where, for the first time, the majority people in these parts of the world were no longer living in poverty and scarcity.

The reports I read clearly show over the last quarter century, we are losing these historic gains.

Yet again, all we get from the dominant economic schools out there today is not solutions to these problems, or even an admission that the post-WWII to 1960s economic policies fared somewhat better for people. Instead, we get fallacious irrelevant baloney that there is “more wealth per capita than ever before” to defend what are in fact damaging malicious economic policies designed to do exactly what they are doing and totally failing to live up to what their promoters have promised.

I can’t find a link now, but I remember reading some time ago that Saudi Arabia has as much wealth per capita as Sweden and Finland. Yet the latter two countries enjoy among the highest living standards, largest degree of freedoms and most innovative and dynamic economies in the world, whereas the former is still practically in the Dark Ages for most people. So it’s not just how much wealth there is (and there are different ways of measuring that). But who has it, who controls it and how it’s used.

And so from now on, you should realize that when I make an assertion it’s because I’m fairly certain it is for real—unlike a lot of the insulting factless toxic waste that too often comes out of corporate apologist cess pools like the Fraser and CD Howe institutes or Corporate Canada itself (like “global warming is a myth;” “Indonesia and Chile under martial law or South Africa under Apartheid are/were ‘free societies;’” “ labour unions cause job loss;” “women fare better than men in the market place;” “economic freedom is the power of bosses to unilaterally set conditions and rules on workers;” “second hard smoke isn’t harmful,” “sweatshops are a sign of prosperity,” “most poor people are faking it,” etc.)

quote:
That is why I cited fairly specific facts like "there is more wealth per capita among Canadians now than ever before in history" (obviously, as I alluded to in my post, that doesn't show how its distributed) and my citing of the near dissapearences of recessions now and what the world was like 100 years ago.

I guess that depends on what you define as “recession.” Near disappearance? Only two recessions in 25 years? Not according to these folks:

Shallow recession 2002-2004 BMO

Early 2000s mild recession

Asian Crash 1997 Impact on Exports

Canada Recession 1989-1992

Depression 1979-1985

Canadian economy slowed by US stagnation in 1980s

Seeking an end to the global slump 1974-1977

quote:
It is only by quantifying these things that you can then have a serious analysis of the trade offs involved in any of the choices available.

So why don't you tell that to the Neo-Con Fraser Institute trash that's taken over the SFU economics department like a bad in case of gangrene, instead of pretending that I'm guilty of this?

quote:
Some on the left would call that trying to get 'the greatest good for the greatest number'.

Not if all that’s being done is generating irrelevant feel-good pap to paper over bad situations.


From: goes far, flies near, to the stars away from here | Registered: Aug 2006  |  IP: Logged
Adam T
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posted 14 July 2007 10:20 PM      Profile for Adam T     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
So why don't you tell that to the Neo-Con Fraser Institute trash that's taken over the SFU economics department like a bad in case of gangrene, instead of pretending that I'm guilty of this?

I don't know who you are referring to at SFU. I think you know me well enough to know that I'm not some right wing laissez faire economics theorist. We probably agree on most things.

I will read the links you've provided tomorrow. Thanks.


From: Richmond B.C | Registered: Nov 2003  |  IP: Logged
Adam T
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posted 15 July 2007 07:20 PM      Profile for Adam T     Send New Private Message      Edit/Delete Post  Reply With Quote 
I've only had time to look over the links that you provided that questioned my statement that there has only been one recession in the last 25 years. (one recession since the big 1982 recession).

I will look over all your other links within the next several days, however I have to regretfully say at this point that you appear to be guilty of doing what you criticize economists for doing: manipulating evidence to fit your own conclusions.

quote:
guess that depends on what you define as “recession.”

A recession has a very precise definition as 'two consecutive quarters of negative growth'.

1."Shallow recession 2002-2004 BMO"
Story written: Monday, November 12, 2001
BMO was making a forecast of a shallow recession. They obviously could not have been describing a recession before it had even occured.

2."Early 2000s mild recession"
Yes, this site backs up what I said. "However in the wider economy Canada was surprisingly unhurt by these events. While growth slowed, the economy never actually entered a recession."

You make one valid addition to my claim. There was one quarter of negative growth in the early 2000s in Canada. Not enough to be defined as a recession, but obviously still a slowdown and people did suffer.

3."Asian Crash 1997 Impact on Exports"
As the story indicated, the crash mainly hurt B.C. As a resident of the province I am fully aware of that. However, these things also play out in other ways. The decline in resource prices that hurt B.C also helped the manufacturing sector in Ontario.
This is how an economy normally works and I doubt any changes in economic systems could change that: some sectors of the economy are doing well, other sectors not so well. Similarily, some companies in a sector are doing well, and others are failing to compete. I don't think we would want to change that. Obviously it is unfortunate for the workers that suffer, which is why we need the safety nets, but it is the competition between companies that results in technological and processes innovations. I would not want to trade these things off for some illusion of greater security. You could ask the majority of French people how well those trade offs worked, for instance.

4."Canada Recession 1989-1992"
quote from the site "The recession technically lasted four quarters. Yet, the recovery was slow, but since it started there has only been that one quarter of negative growth since, and the economy in the late 1990s was very strong.

5."Depression 1979-1985"
The recession had ended by the end of 1982 and the economy had started to recover very quickly by early 1984.

So, basically in the approximately 100 quarters since the severe recession of 1982, there has been at most 5 quarters of negative growth.
Yes, you are correct to point out that there have been sluggish quarters, and the recovery out of the 1991 recession was slow, particularily in Ontario. I think most economists would tend to lay the blame for that on what is generally now considered to be excessive inflation fighting of the Bank of Canada. And individual provinces like B.C in the late 1990s and Alberta during the oil price slump may have experienced provincial recessions. In that case, however, as I said, the losses for one province tend to be the gain for others.

However, as much as we can blame the Bank of Canada for the slow recovery of the early 1990s, I think we also have to credit them for what is a really remarkable record of approximately 95 of 100 quarters of economic growth.

It certainly compares favorably to the record of 9 recessions and 2 mini depressions that occured during the period of 1877-1911 (which happens to be a period before the Bank of Canada existed).


From: Richmond B.C | Registered: Nov 2003  |  IP: Logged
Steppenwolf Allende
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posted 15 July 2007 10:21 PM      Profile for Steppenwolf Allende     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
however I have to regretfully say at this point that you appear to be guilty of doing what you criticize economists for doing: manipulating evidence to fit your own conclusions.

Nice frame-up, Sherlock. But it won't work. I said that it depends on one's definition of recession. Obviously the "negative growth for two consecutive terms” is only one measure. You know that, according obviously to what some of those sources I linked to say, any sustained reduction in growth (which is itself an inaccurate measure of well-being) can constitute a recession—or at least manifest similar conditions to one (it’s pretty much the same to those affected).

You likely also know that governments of every major economy on the planet for the at least the last century have been trying to figure out ways of eliminating or at least curtailing the impact of recessions and slow-downs.

The most successful of these has been the Keynesian strategies adopted in the 1930s in various ways to various degrees by numerous governments across the globe. Those, as you also likely know, have been watered down or abandoned, and the pain of this is being felt.

quote:
You make one valid addition to my claim. There was one quarter of negative growth in the early 2000s in Canada. Not enough to be defined as a recession, but obviously still a slowdown and people did suffer.

Actually, no, it is a detraction, not an addition, to your claim, since your claim indicated there were supposedly two recessionary-like periods in the last 25 years where people suffered. The sources I linked to show there have been more than that and that a lot more people have been suffering for much longer periods than your claim implied.

quote:
I will look over all your other links within the next several days

That’s fine. Whatever you feel like doing. But if all you’re going to do is try to twist what they say in attempt to make me look dishonest, then you’re wasting your time. There are many more sources as well that report similar problems that I have read that have helped lead me to the conclusions I posted earlier.

quote:
I think you know me well enough to know that I'm not some right wing laissez faire economics theorist. We probably agree on most things.

Actually, I don’t know you at all, other than from a couple things you have written here. But, no, I don’t think anything like that about you, and I’m not trying to be a jackass toward you on any of these matters. We probably do agree on many things.

But, as I said before, I’m pretty disappointed with the general direction of economics schools and think tanks, as most of them seem to be more interested these days in preaching religion and protecting the fundamental status quo, instead of solving problems and supporting the collective improvement of all in general.


From: goes far, flies near, to the stars away from here | Registered: Aug 2006  |  IP: Logged
Adam T
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posted 15 July 2007 11:40 PM      Profile for Adam T     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Nice frame-up, Sherlock. But it won't work. I said that it depends on one's definition of recession. Obviously the "negative growth for two consecutive terms” is only one measure. You know that, according obviously to what some of those sources I linked to say, any sustained reduction in growth (which is itself an inaccurate measure of well-being) can constitute a recession—or at least manifest similar conditions to one (it’s pretty much the same to those affected).

1.No, two consecutive periods of negative economic growth is the only definition of recession.

2.Using that term to imply something else fits into the notion of manipulation.

3.Some economists use the term 'growth recession' to indicate a slowing of a growing economy.

4.I agree that GDP is an imperfect measure of well being.

5."(growth recessions vs recessions are) pretty much the same to those affected"

I don't agree with that. In most circumstances people have a much easier time finding new employment when the economy is growing than during a recession.

There are always going to be changes in the economy and I highly doubt that any alternative economic system you might propose would change that.
To use the examples already given, there are is always the danger of an economic collapse in other parts of the world that would lead to a slowdown in exports in British Columbia. There is always the possibility of new oil discoveries that result in collapsing oil prices that affected Alberta in the mid 1980s.

This occurs in manufacturing as well. New technologies like the internet with file sharing ability have taken away the jobs of many people who work in the recording industry.

As much as you try to suggest it is some sort of a 'right wing conspiracy', economics research based on empirical data suggests the best things for government to do knowing that changes will always occur is to provide a safety net (fiscal policy) and to use the central bank to promote low inflation thereby promoting stable economic growth (monetary policy).

There is some debate in these areas, of course over things like whether an active or passive safety net is better in the case of fiscal policy and whether the central bank should have an explicit anti inflationary mandate or whether there should be a dual mandate of fighting inflation and promoting high stable growth in the case of monetary policy.

quote:
Actually, no, it is a detraction, not an addition, to your claim, since your claim indicated there were supposedly two recessionary-like periods in the last 25 years where people suffered. The sources I linked to show there have been more than that

I said there were two recessions in the United States and one recession in Canada since the ending of the big recession in 1982 (about 25 years ago). All of the links you posted back that up. You also posted links showing declines in specific sectors. I would just repeat what I said above.

I chose 1982 because that was the time the Federal Reserve in the United States and the Bank of Canada more or less adopted the policies set out by the monetarists of making inflation fighting their primary purpose. Monetarism is basically inline with the neoclassical economic school.

This policy brought on the 1982 recession, but since then has been one of the main reasons recessions have been both slighter and less frequent in the past 25 years than in any prior period in the United States and Canada (except for maybe parts of the post World War two era).

Prior to this, the central banks followed Keynesian theories. Again, it was not some "Invasion of the Body Snatchers" type right wing takeover that caused this change. It was because monetarism better explained the empirical data. Keynesian economics was unable to explain the stagflation western economies were experiencing in the 1970s and the monetarist inflation expectation hypothesis did. Looking at aggregate economic performance since this time, it would seem that the monetarist theory was correct.

[ 15 July 2007: Message edited by: Adam T ]


From: Richmond B.C | Registered: Nov 2003  |  IP: Logged
Steppenwolf Allende
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posted 16 July 2007 01:06 PM      Profile for Steppenwolf Allende     Send New Private Message      Edit/Delete Post  Reply With Quote 
Adam T wrote:

quote:
1.No, two consecutive periods of negative economic growth is the only definition of recession.

There is no one explicit meaning for “recession.”

Just a look at an on-line dictionary shows no less than four economy-related definitions for that term, as well as the sources I posted the other day.

It’s certainly true that all of these have a similar basis, as your definition does. But they are certainly not identical, and certainly have varied meaning depending on the economic sector and how it experiences the impact of a recession—just like with terms like “depression,” “slowdown” or “stagnation.”

Funny thing is, I don’t disagree with your definition either, as its’ pretty much similar to the rest. That’s why I find your dogmatism around it so amusing.

quote:
2.Using that term to imply something else fits into the notion of manipulation.

See, here we go again. Your accusation against me for supposedly doing this is crap, and you know it. Manipulation applies to intentionally taking an established term, totally divorcing it from its historic meaning and applying it to something not related to it at all—usually for some unethical or ulterior gain (like, for example, the Russian Stalinist/Chinese Maoist regimes divorcing terms like “socialism” and “communism” from their practical historic definitions and using them as selling gimmicks for what they in fact admitted were/are their highly centrally regulated state capitalist models—which had/have little in common with what those term historically represent).

That’s not what’s happening here, as the term “recession” is not being divorced from its meaning and used to describe something else. Rather, as those sources indicate, there are variations of what the term means whoever is affected. That’s why some of these sources would disagree that there have only been two recessions in the last 25 years.

quote:
3.Some economists use the term 'growth recession' to indicate a slowing of a growing economy.

This is true, as again, some of the sources I linked to indicate. So a recession does not necessarily require a negative GDP in order to be active according to many economists. Other prefer to call that situation a slowdown. But many of the symptoms are similar, indicating a varied, but fundamentally similar, definition.

quote:
4.I agree that GDP is an imperfect measure of well being.

Glad you agree. I would push it further and say it is a VERY imperfect measure of well-being.

quote:
I don't agree with that. In most circumstances people have a much easier time finding new employment when the economy is growing than during a recession.

Perhaps—again that depends on the sector and how it’s affected and also on what general situations workers in those sectors are dealing with. But it’s not that the impact or symptoms are different. Rather it’s usually a matter of severity. For example, a recession where the GDP falls into a negative is usually considered to be more severe than one where the GDP drops but still remains in a positive. Yet for the people in the sectors most affected by this, the impacts are similar.

quote:
There are always going to be changes in the economy and I highly doubt that any alternative economic system you might propose would change that.

The problem isn't changes in the economy. That's a given.

Rather, the problem is an economy that treats the working/consuming population that creates it as largely de-humanized commodities largely subject to the dictates of those undemocratic institutions that control and regulate capital and commercial wealth everyone else creates for their own special exploitative interests at everyone else's expense.

This is why economic changes are often so painful for large numbers of people and their communities, as they are sacrificed to suit the agendas of various elite special interests.

quote:
To use the examples already given, there are is always the danger of an economic collapse in other parts of the world that would lead to a slowdown in exports in British Columbia. There is always the possibility of new oil discoveries that result in collapsing oil prices that affected Alberta in the mid 1980s

No argument there. That’s been going on in various ways for at least five centuries, as far as I can tell.

quote:
New technologies like the internet with file sharing ability have taken away the jobs of many people who work in the recording industry.

Not quite. I work partly in that industry, and there are many factors behind job loss there. The Internet, though, as far as I can tell, isn't a very big one.

quote:
As much as you try to suggest it is some sort of a 'right wing conspiracy', economics research based on empirical data suggests the best things for government to do knowing that changes will always occur is to provide a safety net (fiscal policy) and to use the central bank to promote low inflation thereby promoting stable economic growth (monetary policy).

“Conspiracy” is largely irrelevant. Economic research based on empirical data is exactly how things need to be done.

The fact is though, with the growth and influence of corporate apologist sleaze groups like the Fraser Institute, the twisting and intentional misinterpretation of data, the stretching of its practical meanings to the point of where they can literally conclude anything they like, including the opposite of what the data shows, to advance a totalitarian austere agenda, the whole pantheon of economics has been compromised.

That’s no fluke. Former US National Security Advisor in the Carter Administration Zbigniew Brzezinski, along with Republican big shot and super-billionaire David Rockerfeller, helped found the Trilateral Commission, a secretive club of major US capitalists, government bureaucrats and military leaders in 1973 with the urging of the Freidman Chicago Business School, the Bilderberg Group and other established corporate capitalist think tanks, to promote and implement economic policies for the benefit and protection of multi-national corporations, banks and various state-run businesses and bureaucracies and the around the globe.

It’s this group that started pushing the Neo-Con fiscal monetarist agenda in North America big time, with a large degree of success by backing politicians who would carry out such measures. So while a conspiracy theory may be out of the question, let’s not say these policies simply came about just because of honest empirical research and objective analysis—because they did not.

[URL=http://en.wikipedia.org/wiki/Trilateral_Commission]

[ 16 July 2007: Message edited by: Steppenwolf Allende ]


From: goes far, flies near, to the stars away from here | Registered: Aug 2006  |  IP: Logged
Adam T
rabble-rouser
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posted 16 July 2007 01:20 PM      Profile for Adam T     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Rather, as those sources indicate, there are variations of what the term means whoever is affected. That’s why some of these sources would disagree that there have only been two recessions in the last 25 years.

No, there is only one definition of recession used by economists and it is the technical one I have already spelled out. If I am seen by you as being dogmatic on this, it is because I believe that precise terms should be used with the precision they are intended for.

Some people may claim broader use of these terms in non economic discussions, and that's fine. But, when there is a discussion on economics and the term is used, it should only be used in its precise meaning. Otherwise, the language gets confused and people can start trying to claim anything.


You may be correct that only an economist (or an aspiring economist) would care about that in so far as most people may not know the technical definition of recession.

Ultimately, what they care about (and what you are posting about) is how the economy has performed, irrespective of whether is has fallen into recession or not (and a growth recession is not the same as a recession. Possible confusion though between the two terms may be why hardly any economist that I know of uses the term growth recession. As you stated, the term slowdown is the term generally used.)

On that, you are correct that there have been periods of slow growth. However, the economy in the past 25 years in the aggregate has still performed better now (at least in Canada and the United States) than in at any time in history except for possibly the immediate post world war two era.

I would also point out that it seems you agree with me in why I object to terms being stretched in their usage:

quote:
The fact is though, with the growth and influence of corporate apologist sleaze groups like the Fraser Institute, the twisting and intentional misinterpretation of data, the stretching of its practical meanings to the point of where they can literally conclude anything they like, including the opposite of what the data shows,

"Stretching of its practical meaning to the point where they can conclude anything they like."

Yes, like using precise terms like recession and growth recession interchangebly and mixing up the colloquial use of the term recession with the precise economics definition.

[ 16 July 2007: Message edited by: Adam T ]


From: Richmond B.C | Registered: Nov 2003  |  IP: Logged
Adam T
rabble-rouser
Babbler # 4631

posted 16 July 2007 01:54 PM      Profile for Adam T     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
That’s no fluke. Former US National Security Advisor in the Carter Administration Zbigniew Brzezinski, along with Republican big shot and super-billionaire David Rockerfeller, helped found the Trilateral Commission, a secretive club of major US capitalists, government bureaucrats and military leaders in 1973 with the urging of the Freidman Chicago Business School, the Bilderberg Group and other established corporate capitalist think tanks, to promote and implement economic policies for the benefit and protection of multi-national corporations, banks and various state-run businesses and bureaucracies and the around the globe.

It’s this group that started pushing the Neo-Con fiscal monetarist agenda in North America big time, with a large degree of success by backing politicians who would carry out such measures. So while a conspiracy theory may be out of the question, let’s not say these policies simply came about just because of honest empirical research and objective analysis—because they did not.


I don't know how much of this I agree with. On the one hand, we have certainly seen an uncomfortable mixing of politicians and big business with the llobying and trading for favors in the Congress, the crony capitalism of George W. Bush and the lack of prosecutions (or even investigations in many cases) of corporate crime here in Canada.

On the other hand, some of these conspiratorial accusations are getting dangeriously close to Alex Jones' territory.

I would point out
1.One of the major founders of either the Trilaterial Commission or the Bilderbergs was the former Social Democratic Prime Minister of Germany.

2.You seem to be of the view that I've seen too often among the left that no average person would vote for right wing politicians if it weren't for the corporate propaganda.

If we look back to the period where monetarist theory was being endorsed politically, we go back to Ronald Reagan in the United States and Margaret Thatcher in Britain. Well, like it or not, they had mass followings, especially Reagan, and these people weren't all under some propaganda influence.

Finally, the fact of the matter is that monetarism, at least the monetary policy aspect of it, worked.

Any central bank basically has one choice to make at all times: whether to follow an easier credit policy (lower short term interest rates) or a tougher credit policy (higher short term interest rates). That is practically all a Central Bank does.

The Keynesian view in the late 1970s early 1980s was to focus on unemployment and go for the easier credit policy, the Monetarist view was that only by first eliminating inflation as a problem could unemployment be dealt with and that tighter credit was needed.

(If you look over economic history at the time, it's a bit more complicated than that in that the central bank at the time tried to focus on the amount of money being created rather than specifically on inflation or even job growth, but the tool to do that was the same as it is now: changing the overnight bank lending rate)

As I said earlier, the adoption of the monetarist plan led to a severe recession in the early 1980s, but ultimately paved the way to a major economic expansion. To me anybody who challenges monetarist monetary policy would have to show to me that the economic performance of the late 1970s was better than that of the mid to late 1980s which most economists would say is pretty much impossible to do.

Keynesian monetary policy theories didn't become discredited among economists because of some corporate conspiracy, they lost out because they didnt' work: they failed to address stagflation.

Similarily, monetarist monetary policy didn't become accepted among economists because of some corporate conspiracy, it got adopted because it worked.

Now, none of this has to do with fiscal policy. Monetarist 'trickle down' theories or the notion that 'tax cuts pay for themselves' are jokes, and, as far as I can tell, are not accepted by most economists.

[ 16 July 2007: Message edited by: Adam T ]


From: Richmond B.C | Registered: Nov 2003  |  IP: Logged
Adam T
rabble-rouser
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posted 16 July 2007 08:32 PM      Profile for Adam T     Send New Private Message      Edit/Delete Post  Reply With Quote 
Steppenwolf, this is merely annecdotal and not proof of anything, but, you might be interested in the prospective Green Party candidate in the Illinois 6th district (Democrat heavyweight Rahm Emanuel's district).

The candidate for nomination is Alan Auguston http://augustson2008.us/

Who he is? He is an economist who was until recently the Associate Director for Issue Councils at the Illinois Chamber of Commerce.

How about that? An economist who is a member of the Green Party and who also holds a senior position for a statewide Chamber of Commerce.

Where exactly does he fit into your world view?


From: Richmond B.C | Registered: Nov 2003  |  IP: Logged
Fidel
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posted 17 July 2007 02:11 PM      Profile for Fidel     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Originally posted by Adam T:
Keynesian monetary policy theories didn't become discredited among economists because of some corporate conspiracy, they lost out because they didnt' work: they failed to address stagflation.

The U.S. government printing money to fund the Vietnam war slash Keynesian-militarism in the States had nothing to do with Keynes. The energy crises of the 70's were another sign that capitalism abd industrialist societies in general are vulnerable to technological stagnation.

There were periods of stagnation when society began running out of wood to burn. Then it was coal. Today it's oil. The capitalists have extracted most of the least expensive to drill for oil and gas for maximum profiteering. Over the last 30 years, the U.S. and Canada have defunded higher education and dropped nuclear research into ways out of this mess. They've created a nation of uneducated paupers with nothing in particular driving the U.S. economy except for finance, insurance, and real estate.

And now they're in trouble because of the neo-Liberal capitalist voodoo - the same Friedmanite voodoo that failed in Pinochet's Chile in 1985.

The so-called capitalist west dealt with technological stagnation by investing large amounts of money into public research: academic and military and civilian agencies at the federal level. DARPA produced reams of technological innovations that were simply handed off to a few hundred wealthy friends of the U.S. government, private enterprise aka "the free market" in the 1980's.

Keynes was dead a long time by this point. His theories did save capitalism from itself. Then again, the west did not implement all of JM Keynes's suggestions. Keynes was bitterly disappointed with the outcome of Bretton Woods.

On the other hand, Friedman's monetarism was dropped by the Federal Reserve in 1982 observing a monetarist disaster unfolding in Maggie's Britain. The Bank of England finally ditched Friedman's monetarism in 1986.

Friedman's NAIRU is still controversial in Europe and Canada. Economists Olivier Blanchard(MIT), Lawrence Summmers(Harvard), and Pierre Fortin(Canada) among others have more or less said Friedman was all wet on inflation wrt the NAIRU.


From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
lonecat
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posted 18 July 2007 12:12 AM      Profile for lonecat   Author's Homepage     Send New Private Message      Edit/Delete Post  Reply With Quote 
Economics is transdisciplinary, so it is naturally going to move into a variety of fields. There are many research topics in Economics...my favourite areas are Labour Economics, Welfare Economics, Feminist Economics, and Women and the Economy. In my experience, Calculus is only about 1/4 of the math used in Economics...most of it is actually Linear Algebra (matrices), which becomes very useful in determining 'signs', ie. when there is a shock to the economy, or the government announces x-change, will the variable (ie. gdp) increase or decrease, or is the change ambiguous? Does the estimated change differ from the predicted sign?
I maintain, that the research done in Economics is useful only when it is done to help people. I suspect many rabblers are put off with the amount of economic research that is done in macroeconomics (ie. international trade). I vouch that much progressive research is done in economics that improves the lives of people; we just don't hear about it that often.
Also, much of today's economic research has been heavily influenced by the late Milton Friedman from the "chicago" school in economics. Friedman's work is still enormously controversial, to say the least.

From: Regina | Registered: Apr 2004  |  IP: Logged
Illuminoid
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posted 18 July 2007 02:06 PM      Profile for Illuminoid   Author's Homepage     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Henwood: When I first started this newsletter, I also thought that all "we" needed to do was get the facts out there and the politics would eventually sort themselves out. People were either under- or misinformed, and a "better empiricism," as an old friend of the newsletter once put it, would do the trick. If only life were so simple. It's become clear over the last twenty years (to me, that is) that facts often matter little in politics; that ingrained "common sense" or the eagerness to believe what one wants to believe often takes precedence over rational argument. You can tell people that the U.S. is the most income-polarized society in the First World and that our economic mobility is no greater than Old Europe's—if you get the chance to tell them, that is—and they either won't believe you, or they'll quickly forget what they've just learned. Because, as everybody just knows, class distinctions don't matter in America because we're so fluid, and we're all middle class anyway, except maybe Bill Gates and that troublesome urban underclass.

I've found this happening far too often myself. I'll get into an argument with someone who believes that current economic policies are good enough, that everything about the way western society functions has no problems at all, but when I point out the problems that are affecting us and the problems we're causing, and how so many things have been defined in a fraudulent fashion to distract people from reality, they'll agree with it. The next time the subject comes up, it'll be as if we never had the latter dicussion to begin with and I'll have to state the factual all over again.

The problem I have with today's economists and the economists that have helped to build the economic policies in place today are that they frequently employ a large dose of blatant hypocrisy in their reasoning. Their ideas are arrogantly fascistic at best, and have everything to do with assuming that people are too dumb to take control of their own lives and destinies.

The obsession with the idea that growth is the only way forward is what's killing us all right now. We have limited resources, and this is becoming more and more apparent every day, sometimes even with every hour, yet we continue on this path of growth at any cost for its own sake. Not only are serious shortages of materials just over the horizon, but wars over these shortages as well. We need economists who can think of ways to do more with what we already have, and instead we're stuck with the ones who want to continue on with ideas that are now two hundred years old and no longer have anything to do with our current reality.


From: Ottawa, Ontario, Canada | Registered: Jul 2007  |  IP: Logged
Fidel
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posted 18 July 2007 08:57 PM      Profile for Fidel     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Originally posted by Illuminoid:
The obsession with the idea that growth is the only way forward is what's killing us all right now. We have limited resources, and this is becoming more and more apparent every day, sometimes even with every hour, yet we continue on this path of growth at any cost for its own sake.

Growth is the only way first and third world countries can keep the wolf from our front door, or iow's, the banking cabal which enjoys hypnotic power over democratically-elected governments everywhere. Since ythe 1980's-1991, there isn't enough cash money circulating in the Canadian economy to ever pay down what must be over a trillion dollars worth of personal, provincial and federal debt to private banks. It wasn't always this way. Between 1938 and 1974, Canada's Central Bank created as much as a quarter of the money supply on a near interest-free basis. Our total national debt by 1974 was a paltry $18 billion dollars.

So the the bottom line in all of this is that there is never enough money to pay interest on debt owed to banks, only the principal amount is ever created. Governments, businesses and people must continually go into more and more debt to create the money to pay interest owed on existing debt. When debts become too much to handle, businesses experience downturns, layoffs happen and people lose their homes and stuff to the banks or the armies of finance companies owned or operated through banks with ownership in easy credit agencies. Growth is given in the economic model we are enslaved to.

And I agree, the whole thing is unworkable considering environmental constraints. Capitalist's profits are being made at great social costs and expense to the environment. They're not even operating on the basis of demand anymore, because that would imply there was competition. Multinational conglomerates are dictating demand to people through billion dollar advertising. People are brainwashed into believing they need the lastest plastic widget created from oil byproducts and sweat shop labour.

Capitalists today operate by oligopolies. Real capitalism was just an idea that died in 1929, and it that idea is out of date with today's economic constraints of dwindling resources, irreparable damage to the global enviroment, and capitalism is at risk of being unable to meet the needs of individuality once thought to be a hallmark of capitalism. Instead, individualism is rewarded with few questions asked about how or why whether it was even warranted. It's high time there was a revolution and governments created to be run by and for ordinary people.


From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
Illuminoid
recent-rabble-rouser
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posted 18 July 2007 11:02 PM      Profile for Illuminoid   Author's Homepage     Send New Private Message      Edit/Delete Post  Reply With Quote 
I'm well aware of the interesting financial conundrum we have. In fact, every country in the world has that same problem, since the World Bank has effectively stolen all of the world's currency, and what we have left is money that's not actually worth anything because it's backed by the very debt we owe in order to get our money back. A very clever scheme, no?

But still, regardless of what's happened to our money, growth does not have to be the only way forward. Norway is a good example of this. Norway is by no means the fastest growing nation on the planet, but the people who live there seem to have a very good system of government and a good standard of living. Instead of striving to be fastest growing, I think we should do something do something along the line of striving to be within the top ten to fifteen, but never the first, second or third. If we should reach that point, it might be a good indicator that we should cut back our growth for a while and see how other people get ahead.


From: Ottawa, Ontario, Canada | Registered: Jul 2007  |  IP: Logged
Fidel
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posted 19 July 2007 09:01 AM      Profile for Fidel     Send New Private Message      Edit/Delete Post  Reply With Quote 
I don't think there's any danger of Canada making the top ten list for most competitive economies in the world. Even socialist Norway ranks higher by that indicator, as small a country as it is.

I think our colonial administrators are happy to allow our fossil fuels and massive amounts of total energy exports to be siphoned off to the States for a song. Canada feeds growth happening in the U.S. and other economies with our unparalleled natural wealth. Studies have suggested that countries with oil and mineral wealth tend to be plagued by corruption.


From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
Fidel
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posted 22 July 2007 10:25 AM      Profile for Fidel     Send New Private Message      Edit/Delete Post  Reply With Quote 
oops wrong thread even

[ 22 July 2007: Message edited by: Fidel ]


From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged

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