I’ve finally had a fast enough internet link to upload the video to Youtube. I’ll add more detail later when I get back to Sydney, but for now this will do.
There’s one technical glitch: the Gustav Tuck Theatre had a plasma screen rather than a data projector, and the refresh rate of the screen resulted in a very bad flicker on the video recording. However the talks–by myself and Ann Pettifor–are easy enough to follow.
My speech and Ann Pettifor’s speech at the launch of the 2nd edition of Debunking Economics, at the University College London on October 4 2011. I give an overview of the new edition, which focuses on the absurd state of neoclassical macroeconomic theory and the reasons that conventional economists were the last people on the planet to realize that a serious economic crisis was about to occur. I also outline my “Monetary Circuit Theory” approach that let me anticipate the crisis. Ann Pettifor gives an excellent outline of the endogenous nature of money creation, and the case for both large scale government spending and a modern debt jubilee to get out of this crisis.
Title: A Response to Endless and Lyonwiss
I think it is called the endowment effect in behavioural economics. People who had invested years of their time in the neo-classical synthesis (or any branch of ‘knowledge’) will defend their position, regardless of the truthfulness of that position. Einstein himself could not accept the probabilistic model of quantum mechanics and his peers could not accept his model of flexible spacetime.
Koonyeow lets be honest Steve Keens policies are the same as neo-classical model of Mr Greenspan.
Lower interest rates below the rate of real inflation.
Increase wages without any real production.
forgive greedy speculates debt by getting the taxpayer to bail them out.
Forget moral hazard ,just as long no pain for the greedy suckers in big debt.
If Mr Keen became the finance minister or RBA governor in Australian my investment plan would be to get into as much debt as possible.
Because I know interest rates would be zero and asset values would increase.
Savers and productive middle class would be in the poor house.
Nobody wants the truth so here it is all you elite economists you must have pain and clean the system out or face a bigger financial meltdown later.
Title: Steve Keen Is Morpheus & koonyeow is Neo
“Koonyeow lets be honest Steve Keens policies are the same as neo-classical model of Mr Greenspan.”
Can arriving at same policies imply neo-classicality? No, because a totally different analysis may arrive at same policies too. This is the inverse problem in epistemology. Frankly, as long as we are handing over a worse earth to the next generation, there is no honesty to talk about, for children and the unborn cannot vote.
“Lower interest rates below the rate of real inflation.”
Firstly, I doubt that the rate of ‘real’ inflation can be empirically measured. What goods and services do we include to measure ‘real’ inflation? Does the official CPI measure rate of ‘real’ inflation?
“Increase wages without any real production.
forgive greedy speculates debt by getting the taxpayer to bail them out.
Forget moral hazard ,just as long no pain for the greedy suckers in big debt.”
We need to see from which point Steve entered the scene. Steve entered from the point where there is unprecedented debt to GDP ratio. Does anyone has better solutions than Steve’s? Anyone who wants a taste of the Great Depression please raise his/her hand. By the way, the probability of Steve’s proposals being accepted is lower than breaking the second law of thermodynamics.
“If Mr Keen became the finance minister or RBA governor in Australian my investment plan would be to get into as much debt as possible.
Because I know interest rates would be zero and asset values would increase.”
If I’m a Japanese, I would say, “Gee, we tried that for twenty years and asset values have declined instead.”
If I’m an American, I would say, “We are trying that now and there is still no sign of improvement.”
If Steve does become the finance minister or the RBA governor, I would like Australians to hold Steve accountable if he does not publish the debt to GDP ratio periodically.
“Savers and productive middle class would be in the poor house.
Japanese savers are not in the poor house.
“Nobody wants the truth so here it is all you elite economists you must have pain and clean the system out or face a bigger financial meltdown later.”
Why bother to come to debtdeflation.com if nobody wants the truth? Yes, we must have pain, but cleaning the system out is easier said than done. Who should decide what is clean and unclean?
Finally, although this is an economic blog, my arguments have been philosophical. To make my argument economic, I would like to say, “Focus on credit money, not fiat money.”
@ Koonyeow October 13, 2011 at 1:33 am
You should avoid making analogies between economics and physics, even though many well-known economists historically attempted to imitate physics. But economics today is nothing like physics today.
The fact that Einstein did not agree with quantum mechanics does not prevent a highly consensual view of the phyiscs paradigm. Quantum mechanics is widely accepted and used in atomic and sub-atomic phenonomena. General relativity is widely accepted and used in astrophtisics and cosmology. Both are used highly successfully and indisputably, even though quantum mechanics had philosophical controversies historically.
There is no such parallel in economics, where nothing is universally accepted, simply because for any theory in any area of economics, it is easy to create alternatives which are arguably better. No one is compelled by the force of reason or pragmatism to accept anything in economics. There is only rhetoric, but no science in economics.
Title: Agreeing with Lyonwiss about Science and Pseudo-science
Lyonwiss,
I agree wholly with you about your assessment of physics and economics, or more generally the scientific method. My point is actually about people’s tendency to see the world as they want it to be and not as it is, not about the state of physics and economics. Although the scientific method supersedes personal preference, it does not eliminate it.
Lol. Did Ann Pettifor say that we need credit to solve climate change??
It’s the opposite – if you’re really worried about climate change then extreme deflation is the solution. 2008 was a great year – emissions were significantly down in the US and Europe.
the problem is koonyeow,
what is truth,
objective truth we can all agree on takes generations to develop,
and there are still people around who think copernicus or darwin for that matter got it wrong.
to quote george costanza,
if you really believe it is true, its not a lie.
@ Mahaish October 14, 2011 at 1:14 pm
You quoted: “if you really believe it is true, its not a lie”. Not outright false, but misleading. If you believe something is true, but it is really false, then you are not a liar, but a fool.
If you know something is false, partially false, or not completely true, but you tell anyone (including yourself) that it is true, then you are a liar, and perhaps a fool as well. Most economists fall into this catagory of liars.
There are people who still think the earth is flat:
http://theflatearthsociety.org/cms/
It may be their personal preferences to be fools, but they are fools or liars nevertheless. What I’m saying is that truth is objective, independent of personal preferences. (Note that not all statements are about being true or false, eg, “red is the best color”.)
Title: The Impact of The Highly Improbable
Mahaish,
That is why we need to be thankful to the past giants of science.
Lyonwiss,
The impact of any truth is equally important. There is no need to play russian roulette, even if the truth is
1. The prize being offered (for example) is one billion Australian dollars if the player survives;
2. The probability of survival is 5/6.
We know that Ponzi finance exists and it is negatively consequential.
subjective and objective truth lyonwiss,
to take einsteinian conundrum,
does the train arrive at the station , or the station arrive at the train.
or schroedingers cat,
the cat in the box, is it dead or alive , or both,
depends on the frame of reference.
theres no such thing as objective truth,
just the greater or lesser probability that something may be true.
until someone comes along to disprove it with a higher degree of probability perhaps,
it was a bit of a joke the quip about one of the worlds greatest fictional bull shit artists we know george costanza,
and lyonwiss, you are right,
fools they all may be
but foolishness and pig headednes go hand in hand sometimes
@ Mahaish October 14, 2011 at 8:27 pm
The moment you say: “theres no such thing as objective truth”, then you are allowed to lie as much as you like, because your lies may be someone else’s subjective truths. This is exactly why governments tell lies to “maintain confidence”, as one senior bureaucrat actually said to me: “Truth doesn’t matter, only perception matters.” That’s why “we are all doomed”.
Title: Unintended Ignorance
Lyonwiss,
People who are not aware of the scientific method may not be aware that they are lying. Unfortunately evolution has given us brains that prefer bread and circus rather than truth.
“This is exactly why governments tell lies to “maintain confidence”, as one senior bureaucrat actually said to me: “Truth doesn’t matter, only perception matters.” That’s why “we are all doomed”.”
I think that James E. Hansen will agree with you whole-heartedly.
This is highly politicised, taking up ground firmly on the left. Ann clearly wants to print money to fund her idea of a “green revolution” of some kind. I really wish economics and economists could separate their political views from their economic analysis and research.
@ Steven Shaw October 16, 2011 at 5:57 pm
Agree. Speculative and unscientific neoclassical economics has been proven false and disasterous. This open up opportunties for all sorts of other speculative and unscientific theories, based on other political biases. One type of charlatans are easily replaced by others. The opposite of a wrong may well be another wrong.
Title: A Recommendation to Steven Shaw
You may want to add Arthur De Vany’s ‘The New Evolution Diet’ to your to-read list.