A new Facebook group dedicated to reforming economics tuition has just been established by Edward Fullbrook, the coordinator of PAECON, the Post-Autistic ECOnomics Network.
Called Toxic Textbooks, its aim is to support and coordinate student protest against neoclassical economics at universities and schools around the world. Its manifesto is:
Toxic textbooks helped cause the economic meltdown
The current economic meltdown is not the result of natural causes or human conspiracy, but because society at all levels became infected with false beliefs regarding the nature of economic reality. And the primary sources of this infection are the “neoclassical” or “mainstream” textbooks long used in introductory economics courses in universities throughout the world.
Mass miseducation
Every year these “mainstream” books serve to indoctrinate millions of students in a quaint ideology (perfect rationality of economic agents, market efficiency, the invisible hand, etc.) cunningly disguised as science. This mass miseducation deprives society of the moral and intellectual capacities it needs in order to design and maintain the support systems required by market economies.
We need new, non-toxic textbooks
More economic catastrophes will befall us and our children if we do not replace these toxic textbooks with non-toxic ones immediately. If decency and good sense prevail in academia, then affecting this reform will not be a problem. But textbook reform will damage many economic faculties and toxic textbook authors. The former will suffer losses to their reputations, the latter to their royalties, which in some cases run to millions of dollars.
Together, we can overcome these vested interests
Society can therefore expect well-placed and richly-funded strategic resistance to doing the right and necessary thing. This website and the associated Facebook group exist to help citizens, especially students, mobilize and organize themselves to overcome these vested interests.
Edward has also established a website, also called Toxic Textbooks, , as an adjunct to the Facebook group.
As I have argued numerous times on this blog, though there is no doubt that most neoclassical economists are well-meaning and fervently believe they make a positive contribution to society, their underlying model of the economy is delusional. Following a bad theory ultimately leads to catastrophe, and that is what we have today with the Global Financial Crisis.
Conventional economics not only completely failed to anticipate this calamity, but actively if unconsciously aided its growth by promoting deregulation of finance, by the development of financial derivatives, and via rescues of the financial system that simply encouraged its Ponzi behaviour to scale heights that poor old Charles Ponzi could only have dreamed of.
If economics were in any sense a science, this dramatic failure would lead to a period of soul searching and intellectual forment from which would emerge a more empirically grounded vision. But with the essentially unscientific nature of economics, this development is unlikely unless enormous pressure is brought to bear on academic economics departments by their students, by business groups, unions, and community groups–in short by anyone whose welfare is affected by the economy.
The most immediate source of pressure will be students of economics, who can and should actively protest against being taught neoclassical dogma as the global economy goes into meltdown around them.
As an undergraduate, I led such a revolt at the University of Sydney in 1973. We had marked success in that battle, but lost the war in that economics in general came to be dominated by the false vision of Milton Friedman, rather than by truly scientific, empirically grounded analysis. In a very direct way, the financial crisis is a direct consequence of Friedman’s intellectual victory in the 1970s. Now that we can see the consequences of that victory, it is essential to finally win the war to bring realism into economics.
The time has come for economics students to once again be revolting. Edward Fullbrook has established this group to provide a New Media focus for such student action. I have proudly joined, and I encourage all critical economics academics and students to do likewise.
MACCA,
Try to respond to arguments rationally, rather than attempting personal attacks. If you can’t do this, then don’t bother.
Macca,
People on this blog come from a variety of positions on the political spectrum. It is one of the things that makes the blog interesting – we have the opportunity to consider the wisdom on offer from perspectives different to our own – but it only works because most of the time views are expressed in a manner which respects others & the differing views of others.
I enjoy & appreciate your contributions most of the time, but when you get up on your high horse to rail against what you see as the ‘loony left’ or ‘socialism’ etc I find it very annoying.
Hi Philip,
I find your comments interesting and to be objective I find as MACCA does a “mixture” of the taxpayer’s distribution is more to the non productive.
Many countries in the World have this philosophy and to them it works collectively of course, for I find when I talk with most people who embrace such ideals that they, when it comes to individual choices use the system as much as those in a freer economy.
In the latter the pace is faster, the going is harder and productively I find more financially rewarding, self esteem is higher for there is less room for dependency on Govts. This, I believe is why (and in my opinion) self funded retiries are disadvantaged by the current sugar hits and splash cash economy.
I didn’t read MACCAs’S comments as personal attack on you per se rather than his view, which I relate to more than yours. Please don’t take that personally for we are big enough and adult enough to thrash out out thoughts, after all they are not irrational feelings. whole economies World wide are run on either of your two different thought patterns and to an extreme either side of them.
An economical question: Has the Governments in the World using the injection of “cash” printed or borrowed realised that it can only improve liquidity for a short period of time and that the liquidity they provide, if not converted to profit, will have to be reborrowed (against savings) by the reciprecants, to repay it?
Debt is debt and to spend it on cash flow liquidity instead of infrastructure surely is criminal? for we repay it back the “waste” not the productivity. and MACCA yes it is theft! as all taxation is, necessary but theft none the same.
Economics the way Steve is trying to educate people will eventually overtake the philosophy of ism,s Communism, Socialism, Capitalism Facism etc and become the financial models for Countries to use for their philosophical purposes. Then we truly could have a choice in ho this money that gives stability could be “ideally” used..
Perhaps someone can enlighten me … Macca posted a link to an interesting Mauldin paper
“The End Game Draws Nigh -The Future Evolution of the Debt-to-GDP Ratio” (Macca’s post May 21st, 2009 at 3:04 pm).
Amongst other things, it recommends abolition of a minimum wage.
How would this be a good thing? Isn’t the extremely low minimum wage in the US part of what has got them into the current social/political/economic mess?
Rookess,
“Amongst other things, it recommends abolition of a minimum wage.”
This is a neoliberal myth debunked in Steve’s book.
The article is good as it illustrates what the prominent American economists think about the crisis. I think that it is full of phlogiston.
When Titanic was sinking a band was playing music. Even when they realised that they were sinking…
Rookess,
Good point about respecting differing perspectives. As for abolition of the minimum wage, this is another doctrine of the neoclassical camp. This assumes that the neoclassical theory of marginal productivity and wage determination is correct.
Thus, we hear the continuing drum-beat that income is in line with marginal productivity. A corporate executive receives $10 million for trashing the business and then jumps out the window with a golden parachute and into the golden lifeboat, while at the same time, those who are working productively will earn much less (note that this is not an extreme example, the US & UK offers much larger cases). We are then informed by neoclassicals and corporatists that this is an efficient outcome in regards to wage determination.
Steve does indeed debunk this nonsense in his book Debunking Economics (Chapter 5: To each according to his contribution – why productivity doesn’t determine wages) as ak has pointed out.
gaday,
I have no problem with members pointing out any flaws in my logic, no matter where along the spectrum their political and economic beliefs lie. I do, however, take issue with those who denounce me for being a socialist as a snarl word without actually responding rationally to my arguments with rational counter-arguments. I take this to be a sign that no logical arguments can be given. Any member conjuring up the specter of red scares serves no useful purposes.
If taxation is theft, then it follows that reducing the tax burden is a social good. I believe that my suggested reforms would do so. I fail to see how imposing free market discipline upon the corporate sector (when it defiles market principles whist feeding off the public treasury) is in any way socialist.
hi ak ,
enjoyable comments as always
re your comments on china moving away from the US dollar,
foreigners hold upwards of 20 trillion dollars of US financial and non financial assets. a good portion of it is held by the chinese japanese and arabs.
if china were to begin to convert its US currency holdings into yuan and other currencies , they can say goodby to upto 20% of their gdp.
they are not in a position to inflate their currency and stall their economy, given their precarious situation.
they are going to buy extra absorbant adult diapers and try and wait this mess out, until someone or something forces their hand.
people seem to be assuming its going to be the chinese that pull the pin on the US. it might be the other way round.
the problem for global free trade, such as it is, is that the politics is moving the other way.
americans cant go on subsidising world trade to the tune of 700 billion plus a year forever.
and foreigners cant keep purchising US dollars to the tune of what is now several trillion dollars a year.
whats the bet that american politicians will come along and build their own great wall, a big trade wall to keep foreign barbarians at bay.
there is also the posibility of china becoming more introverted. it has a long history of attempted expansion, only to run back home and pull down the shutters.
there is also the assumption that its going to be the economic policy makers on both sides that are going to be calling the shots.
this delicate situation could come un done, by just one miscalculated strategic gamble by north korea, or taiwan, as oppossed to any machinations within the chinse ministry of economic affiars or finance, or the US treasury .
ni hao mahaish,
At the end of 2008:
China’s foreign financial assets $2.92 trillion
68 % of these in currencies (mostly USD)
Foreign direct investment $169.4 billion
Share investments $251.9 billion
“Meanwhile, it (State Administration of Foreign Exchange) is encouraging companies to investment more overseas, partly to help reduce the upward pressure on China’s currency.
Managing the current system forces China’s central bank to buy up billions of dollars a month to hold the yuan steady amid an export-driven influx of foreign money.
The strategy also is expected to help to diversify the country’s foreign assets away from dollar-denominated investments.”
http://news.theage.com.au/breaking-news-business/chinas-foreign-assets-top-29-trillion-20090521-bg35.html
Regarding our earlier naughty discussion about printing money: let me reiterate that the Chinese are doing it on a large scale to buy dollars.
“To limit market appreciation to less than 5% a year, Chinese monetary authorities print yuan to purchase US dollars and other hard currencies valued at about US$300 billion annually.” (data from 2007)
http://www.atimes.com/atimes/China_Business/IF22Cb03.html
Nobody in China cries that this is a theft. This is a financial operation.
Let me take a final stab at some Austrian ideas.
Please imagine that a relatively small country like Australia gets back into gold standard. How long will the gold last in the country if there is free flow of goods and currencies with China? This was by the way the historic reason why the gold standard was abandoned.
I have mentioned that problem already in the context of Opium wars but I might not have expressed my ideas properly.
There is a good series of articles about China on The Guardian (I have read some of them)
http://www.guardian.co.uk/world/series/china-at-the-crossroads
Many people assume governments act in the best interest of the whole nation, because if they don’t, who will? Unfortunately, reality is different from simple logic.
Government is composed of politicians and bureaucrats. Politicians are essentially PR people, who spend so much time talking (to the public) to get re-elected that they have little time for thinking. Politicians depend on bureaucrats for ideas, either to come up with new ideas or more likely to justify their own pre-conceived ideas. The trouble with bureaucracies, whether public or private, is that they are empires which are top-down, hierachical structures ruled by an iron fist from the top.
Bureaucracies are populated by ordinary people who look after their self interest. Unless the heads of public bureaucracies are well chosen, public bureaucracies do not look after the public interest, rather they are vehicles for self-interest. For example, the MP expense scandal in the UK recently and the state of the hospital system in many parts of Australia, the condition of NSW transport, railways etc. I’m not sure that Larry Summer and Tim Geithner are not corrupt officials feathering their own nests, by aiding and abetting the big private money which is sucking up a lot of public money. Obama may not have made a bad choice (in advisers) for himself poltically, but he has made a bad choice for America.
What I state here is not new. It has been observed by many economists e.g. von Mises in “Bureaucracy”, Michel Crozier in “The bureaucratic phenomenon”, William Niskanen in “Bureaucracy and public economics” etc. The reason why bureaucracies must fail is exactly the same as why empires must fail: because they are grossly inefficient as only the head or the top layer is allowed to think! Most public sector employees are lobotomized. Examples of failed empires include, of course, command economies, such as the former Soviet Union.
At the highest level, the global financial crisis is caused by governments, which are willingly corrupted by fallacious academic education, financed by corrupt big business anxious to profit from mythologies about markets and deregulation. The same governments, with the same politicians and bureaucrats, cannot possibly get us out of the mess, without a revolution in education (non-toxic textbooks) and a revolution in bureaucracy (non-imperial structures), where public servants are allowed to serve the public interest, rather than to serve corrput heads appointed by corrupt politicians. (A recent example of this corruption is Ken Henry of the Treasury. I hope we keep track of his rigged economic forecasts, past, present and future.) When we think of Keynesian economics of active government fiscal policies, we have to think of the bureaucracy which implements them.
Hey guys,
I’m getting married tomorrow so I’ll be out of action for making comments… I’m sure we’ll all talk again soon!
God bless,
Washo
I should be back in two weeks or so… whatever.
Washo,
All the best to you and your wife,
A.K.
It does not at all matter why the bank might crash, nor whether the individuals know the bank will fail, or just got lucky, or took a wild guess. All that matters is that a bank can fail (and be allowed to fail) without dragging the whole system down with it. In a credit bubble situation, banks in general are more likely to fail and so eventually one of them will. This will cool the spirits and deflate the bubble as the surviving banks get more cautious so equilibrium is inevitable in the long-term statistical sense (although at any short term moment there is no particular reason to believe that the system is stable).
There is a problem if too many banks fail at the same time (correlation), so steps must be taken to ensure the banks really are independent and not hedging against one another. A chain reaction between seemingly separate banks will destroy the Austrian system.
The fundamental point that the Austrians are trying to make is that deflating a bubble REQUIRES that someone somewhere make a loss (or we all amazingly share the loss evenly). The credit-money never existed in the physical world, it was all empty promises, so when that deflates some promise must be broken. Crashing a bank provides a well understood point where the loss can happen.
If crashing the bank is not a politically acceptable option, then the loss MUST be made somewhere else, because the promised goods simply don’t exist so they can never be delivered. You choose… where else to put the loss?
Let’s suppose that all Australian dollars are abolished tomorrow and all prices are listed by weight of gold instead of dollars. So we buy and sell like we did before, all the normal rules apply except that no one can print more gold.
As for how long the gold will last, why it will last a very long time given that it does not rust and is one of the most stable metals on Earth. We could plastic-coat each gold coin (probably a good idea for the small denominations) to make them last even longer, and refresh the coating now and then. I mean, it’s not like people are likely to eat the stuff.
If balance of trade is out of whack, and China ends up getting more of our gold than we get back from them, then there is less gold in circulation in Australia so our local prices fall, and our goods become more attractive to buy. How difficult is this?
Over time we mine more gold and bring it back to balance. The historical reason why the gold standard was abandoned was that governments wanted a convenient way to pay for wars and used tax-by-stealth to confuse their simpleminded voters. Gold and silver were universal currencies for thousands of years and it never “ran out”.
Rookless,
I would highly recommend Economics in One Lesson by Henry Hazlitt. Probably best to tackle chapters 1 and 2 before the chapter on the minimum wage. Read the whole thing – it’s really enlightening.
I’ve never heard such a claim. Where have you heard that?
Congrats Washo!
Guys, this is a really fascinating, essentially off-topic, discussion. I can barely keep up with all the comments. We certainly have a wide range of political views here. I detect typical “lefts” and “rights”, socialists and capitalists, along with perhaps anarcho-communists, market socialists, moderate (propertarian) libertarians, anarcho-capitalists and voluntar(y)ists. This of course makes it very much entertaining and informative! It’s great to see that, on the whole, the discussion has remained civil.
In the area of social science – particularly in economics and politics – it seems very difficult to distinguish truth from fiction. I heard that empirical studies can be found to support either side of an economic argument. In addition, people bring their upbringing and life experiences to the debate – basically their biases. Considering these biases, it’s difficult to be open minded. My only recommendation is to be aware of these biases as it helps with open mindedness. Perhaps even disclose theses biases in the discussion. I have been leftish earlier in my life and then more rightish. Now I’m inclined to reject both sides of politics. The system is broken. And, of course, the system didn’t change one iota – only my view of it
“I would highly recommend Economics in One Lesson by Henry Hazlitt.”
As I’ve suggested before:
“As such, any book entitled Economics in One Lesson must be viewed with suspicion unless it admits that what it expounds has little or no bearing to reality and urges the reader to take at least the second lesson. Of course, a few people actually do accept the simplistic arguments that reside in such basic economics texts and think that they explain the world (these people usually become right-”libertarians” and spend the rest of their lives ignoring their own experience and reality in favour of a few simple axioms).”
http://anarchism.pageabode.com/afaq/secC9.html#secc91
Iain
http://anarchism.pageabode.com/blogs/anarcho
Hello All
To get a little closer to the topic while being in some way relevant to the current discussion I would like to offer some general observations. I tend to agree with Steven Shaw the system is broken, badly broken, and if we persist in looking for evidence to support a particular “ism” this “evidence” can be found but we are contributing nothing towards a repair job. It is all part of deeply flawed philosophy.
I have concluded that The Enlightenment passed the economics discipline by. The involvement started and ended with Adam Smith his seminal work does not support general equilibrium and the classical supply and demand “curves” which are part of this nonsense theory. Yet neoclassical economists who do not seem to have read or understood his work quote single phrases to support their stupid theories.
For the last fifty years these neoclassical lunatics have taken conrol declaring that they and they alone understand what is and is not rational. They have influenced spending on research, taken control of projects from engineers, and returned the vocational education system to its pre industrial revolution methods. To summarise they have returned us to a scientific dark age very similar to the one that existed before The Enlightenment.
They have not had control in India and China however and these coutries are now buying up the west.
An excellent book the Puritan Gift by Harper see http://www.puritangift.com/ details the rise of the west following the enlightenment.
The main problem is that economists are mathematically and scientifically “illiterate” no cognitive . This is bad enough for their own discipline but they have, through having inordinate influences in commerce and government interferred with and almost destroyed the disciplines which have created all of the real wealth since the Enlightenment for more than 200 years.
They have enforced this ignorance by steering education away from science and mathematics, and vocational education away from these same disciplines. They have done this because it seems to their small understand that “gold plated” education and technological systems were in place and too expensive.
Not only do we have a broken economic system but also a badly broken technological capability thanks to their egregious performance. They must be sacked. Until they are sacked, every Engineering and Scientific manager and academic will jump to their tunes because they have the purse strings and manage them with ignorance and stupidity.
No one will understand the dynamics of economies until people with adequate knowledge develop an accurate theory of what is going on using the full extent of human knowledge. Until then we have stupid left, right, dogma, isms, and discussions of flawed and pre enlightenment conjecture more closely resembling witchcraft than post elightenment knowledge.
The Stock Market and Hyman Minsky Another economist who misspells principal as principle.
I would be happy if there was one textbook, that had a simple chapter on opportunity cost “you can’t always get what you want”.
This would be given to all students, politicians and taxpayers with a series of examples – you can have a sports field if you give up a hospital, you can have a $5 billion toll road if you give up public transport, etc.
A lot of our present woes stem from the fact that over the last 15 years we have been told that we can have, as a society, pretty much anything we desire.
Rookess,
Quite right, we all come from different walks of life. I am one of them.
Try understanding real life a little more. When views are posted publicly here that seek to impact on peoples retirement plans, taxes, governance, future and accumulated wealth, they should be able to handle a simple challenge, or simply, don’t put them forward.You call that a high horse- I consider it a legitimate challenge on a VERY sensitive viewpoint ie; how we wish to live , be governed and taxed.
To many folk that is a serious matter. I don’t seek to hurt anyone’s feelings in the process, but I try to articulate my position without reams of economic jargon either. Get to the heart of the issue. Sorry for that.
It’s easy. Don’t bother reading my posts. Problem solved?
Philip,
Seeking to promote major changes to the life and plans of other people, couched in economic slieght of hand (changes to taxes within a wealth re-distribution agenda) will elicit some kind of a response or challenge.It may be best to expect that even when it is not comfortable when your views are challenged.
Everyone is entitled to their personal view on what is considered rational. But, no need to hide behind the “personal attack” defence when there was obviously none.
It looks like China may be struggling to come up with the growth that will save our bacon. Thst’s rather ominous when we have to dig ourselves out of debt that will get to at least 30% of GDP.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aNqEbScHtIgo
“China Power Production Fell 3.9% in Early May, Securities Says”
http://www.reuters.com/article/ousiv/idUSTRE54K0MV20090521
“China cheerleading gives way to caution on economy”
“Zhu Hongren, an official with the ministry, told Xinhua that weak economic activity, especially reduced external demand, may exacerbate industrial overcapacity. “Caution is needed before we can say that the Chinese economy has bottomed out,” Zhu said.”
http://www.ft.com/cms/s/0/46f39c02-440d-11de-a9be-00144feabdc0.html?nclick_check=1
Beijing stimulus plan held up
By Jamil Anderlini in Beijing
Published: May 19 2009 03:00 | Last updated: May 19 2009 03:00
“China’s much vaunted Rmb4,000bn economic stimulus package is being delayed by local governments unable to raise their share of financing, according to a report from the state auditor.
The survey, published yesterday, is the first official indication that China’s stimulus measures have not been as effective as the government claims”.
This is dated, but nonetheless an insight into how China manipulates it’s economy. 2 words come to mind – Central+Planning.
http://chinesepolitics.blogspot.com/2008/11/dear-all-in-boston-now-but-here-is-new.html
Tel,
Let me put what you’ve written in the context of the real world. I strongly disagree on the surface but I may agree in the deeper sense.
“If balance of trade is out of whack, and China ends up getting more of our gold than we get back from them, then there is less gold in circulation in Australia so our local prices fall, and our goods become more attractive to buy. How difficult is this?”
It is difficult to agree because the temporal dimension has been ignored. What you have written sounds to me as yet another application of the “equilibrium” theory.
The time scale at which any adjustment regarding local production can occur is several years. For example we import most of our textiles and building new factories would take a year or so (imagine this in a country depleted of currency, you need to buy machines, would foreign investors come to rescue?)
The amount of currency (gold) which can be in circulation is very small compared to consumption of imported goods. Gold reserves in Australia are 80 tonnes.
http://en.wikipedia.org/wiki/Official_gold_reserves
80 tonnes of gold is worth 3.2 bln AUD at 40000AUD/kg. Even if you assume that the price of gold goes up and that privately owned gold goes into circulation this is still a small amount of money.
We have a temporary surplus now ($2,108m in March 2009) but for several years in the recent past we were making deficits at 2 billion/month. So it would take a few months of deficit at that level to drain the currency completely and cause severe liquidity problems.
http://www.abs.gov.au/AUSSTATS/abs@.nsf/mf/5368.0?OpenDocument
This system can be modelled (I can do it on your request) but I think that the descriptive argument is good enough.
Then there is the whole political dimension of the instability I described – possible meddling of a foreign power (any of them) to seize direct control of the assets if local liquidity problems arise.
I think that retrofitting a solution from the 17th century (when the volume of international trade was small compared to GDP) to our globalised economy is simply a very naive idea.
I do agree however with an implicit observation coming from your model. We cannot live forever in the asymmetric world where we import speculative capital and consume more than produce. This is yet another overconsumption and “wealth creation” device. False wealth I would say.
People may hate me but I think that the solution would be very simple – instead of encouraging foreign investment indiscriminately we have to restore control over capital inflow, encourage productive investment and discourage speculative. Let the currency depreciate (this is a free market process not any “socialism”) and restore the conditions where local production makes sense.
Yes some false “wealth” will go and the consumption level will fall but if we don’t do that we will keep accumulating foreign debt. You cannot print your way out of this situation if the debt is denominated in a foreign currency (we may piggyback on the fall of USD though).
Consumption level is maximised in our economy because people vote for politicians who promise good living and “wealth”. Also because reducing it would affect the retail and services sector. One day we will have to confront this problem anyway.
I think that misusing the controls is the actual mistake, not the fact that the governments have means to control the amount of currency, interest rates and other macroeconomical parameters. But we have what we wanted, we voted for our government and it is our ultimate responsibility what happens here.
The Austrians and some neo-conservatives would suggest abandoning the controls.
I think that this would be catastrophic as our most of our trade partners, competitors and friends overseas use them with good results.
I would suggest using them in the right way by the democratically-controlled government. Getting it right will take time but I’m optimistic as we live in a democratic country we just need to be educated.
That’s why I think what Steve is doing is so important and I don’t think I am wasting my time writing this post. Maybe someone will read it and not everything I have written is rubbish?
The lesson from China and other rapidly developing countries is that the controls available in the modern credit-based financial system combined with the robust market economy can be used to promote growth of productive capacities and as a result to improve live of people. This means a decent and sustainable level of consumption as well. Yes this may sound as a socialist idea but this is exactly the explanation of their success I think.
Personally I am against propping up the unsustainable growth but technological progress is in my opinion the only chance to escape the problems cause by shrinking resources and disrupted environment.
Finally let me disagree with the Austrian mantra that “government is evil”. The historic roots of Austrian economics and philosophy are in Austro-Hungary and the misery after the lost WW1.
Basically the bureaucracy level before WW1 was enormous and every-day life during the war full of criminal absurd. During WW1 the Austro-Hungarian state kept sending thousands of young Hungarians, Croats, Polish, Czechs, Jews (and also Austrians and many others) to die for the honour of the house of Hapsburg and the interests the elites.
I visited battlefields of WW1 in Slovenia and Italy. When I saw the scale of that criminal absurd my mind was blown out.
“Cumulative casualties of the numerous battles of the Isonzo were enormous. Half of the entire Italian war casualty total – some 300,000 of 600,000 – were suffered along the Isonzo. Austro-Hungarian losses, while by no means as numerous were nevertheless high at around 200,000 (of an overall total of around 1.2 million casualties).”
http://en.wikipedia.org/wiki/Battles_of_the_Isonzo
Before you even try reading von Mises please read Franz Kafka and have a look at this http://en.wikipedia.org/wiki/The_Good_Soldier_Svejk
The social philosophy of Austrians only makes sense to me in the historical context of fallen pseudo-democratic and bureaucratic countries in Central Europe in early 20th century and totalitarian regimes of Hitler and Stalin taking away basic freedoms.
I think that we simply cannot apply the Austrian social philosophy and abstract concepts of “open society” out of its historical context.
You may not like Kevin Rudd but he is not like Adolf Hitler and our government is not even nearly as bad as the government of Austro-Hungary sending millions of people to die for nothing.
Let’s think about our reality not abstract “ideas”. We can be inspired by them but not enslaved.
MACCA:
The Chinese are known for long marches. It is irrelevant if their production falls by a single digit number for a few months as long as they maintain social stability and keep the massive trade surplus.
I can’t see any systemic problems inside their country – they started from a very low level of development and can sustain healthy growth for decades. The political system is efficient and stable (even if I don’t like the lack of freedom). We have reached natural limits of energy-intensive growth I think but they haven’t. Of course something bad may happen in China as well but I expect it rather in the US.
I am sorry but I think that looking after wealth of a single social group (in the context of retirement plans) cannot be used as a basics to make major economical decisions especially if the country as a whole may suffer. There are other people in this country as well not only investors.