Debunking Economics

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Debunking Economics Supplement

The Zed Books web­site is being redesigned it appears, and hence the link to the fig­ures sup­ple­ment to the sec­ond edi­tion of Debunk­ing Eco­nom­ics has gone miss­ing. You can now down­load it from here:

Debunk­ing Eco­nom­ics Sup­ple­ment

There is also a Kin­dle ver­sion of the book that has all the fig­ures includ­ed:

Com­plete Debunk­ing Eco­nom­ics

History of website


After the saga report­ed below, Gon­za­lo Lira failed to pay the web design­er to main­tain the site, and I reached an ami­ca­ble agree­ment with the design­er to regain con­trol of the site. I don’t have time to main­tain it, but it is still up there and alive on the web. At some stage it will be redesigned to sup­port the book once more.

Some history

I’ll get to the punch-line of this page imme­di­ate­ly: I have lost con­trol of the Debunk­ing Eco­nom­ics sub­scrip­tion web­site to my so-called part­ner Gon­za­lo Lira, and I want to shut it down. Since I am unable to do so (as I will explain below), I can only advise peo­ple NOT to sign up to this site. When I man­age to regain con­trol of it, it will revert to sup­port­ing my book Debunk­ing Eco­nom­ics.

At about this time last year, I was seri­ous­ly con­sid­er­ing shut­ting down my site Debt­watch ( The blog had been a fan­tas­tic means for me to com­mu­ni­cate my warn­ings about the approach­ing cri­sis, and to get my non-ortho­dox eco­nom­ic analy­sis more wide­spread, but after six years, the time it took to main­tain it was seri­ous­ly reduc­ing my capac­i­ty to focus upon my main con­cerns. These were no longer warn­ing of the cri­sis, nor even com­ment­ing upon it, but on devel­op­ing a seri­ous alter­na­tive eco­nom­ics. But by 2012, I was spend­ing more time doing effec­tive­ly cler­i­cal work relat­ed to the blog than I was devot­ing to eco­nom­ic research.

I had two alter­na­tives: either I made the blog pay for me so that I could hire some­one to take that load off me, or I shut the blog down. This was dou­bly urgent at the time since I had hired a helper on the cler­i­cal front using a grant from the hedge fund Sabre­tooth, and they had shut their doors in April.

I was lean­ing towards shut­ting Debt­watch down when Gon­za­lo Lira approached me on May 19th with an idea for a com­mer­cial blog that he supreme­ly con­fi­dent would be suc­cess­ful:

Email on May 19th 2012

Hi Steve,

I want to talk to you about an idea I have—a way to mon­e­tize your site’s traf­fic which I think you’ll like, and which I already know will be suc­cess­ful.

I know it will be suc­cess­ful because it’s the basis of my cur­rent site, And I’m in the process of imple­ment­ing it with a few oth­er peo­ple, includ­ing our mutu­al friend Max Keis­er.

He argued that it would involve very lit­tle extra work for me—a video a week, an audio pod­cast, a blog entry, a month­ly webinar—in return for an rev­enue stream that would let me offload my unwant­ed work onto sup­port staff and get a tidy income on top for me.

Email on May 30th 2012

To reit­er­ate: I will finance and set up the paid site, plus cov­er ongo­ing serv­er costs, main­te­nance and the all-impor­tant cus­tomer sup­port. I will also car­ry out the mar­ket­ing of both the paid and the free sites, in order to bring in new sub­scribers.

If we suc­ceed at get­ting 300 new sub­scribers per month—which I think is com­plete­ly achievable—that would rep­re­sent an income for Steve of approx­i­mate­ly US$180,000 in the first year.

Fig­ure 1: May 30th 2012 pro­jec­tions of expect­ed rev­enue

I had had some brief cor­re­spon­dence with Lira in pre­vi­ous months, but did­n’t know him oth­er­wise. I checked and saw that he had been on some of the same shows that I had been inter­viewed by—Capital Account and Max Keis­er’s show—so I accept­ed his bona fides and decid­ed his idea was worth a try.

As part of putting the site togeth­er, Lira argued that it would facil­i­tate the redesign of if he had own­er­ship of the domain name:

Email on July 7th 2012

Guys, the domain name “” is set to expire in about a month, accord­ing to my tech guy.

I sug­gest that Echo Cham­ber Media assume own­er­ship of the domain name, for the sake of mak­ing the build­ing of the site more expe­di­ent.

How­ev­er, if our asso­ci­a­tion ends for what­ev­er rea­son, Steve receives the domain name back from Echo Cham­ber Media, for a nom­i­nal sum of $1.

The rea­son for this is that the tech guys have to do some stuff for secu­ri­ty on the site. If the domain name remains in Steve’s name, then we have to do a whole to-do with attor­neys and nota­rized let­ters that ascer­tain that ECM has the right to fid­dle with the domain name.

This stuff takes time, mon­ey, and a lot of patience with bureau­cra­cy.

But if ECM is the own­er of the domain name, this can pro­ceed much more quick­ly and effi­cient­ly.

To reit­er­ate: ECM would sell back to Steve the domain name for the sum of one dol­lar the sec­ond our asso­ci­a­tion ends for what­ev­er rea­son.

We would of course write a spe­cif­ic adden­dum to our orig­i­nal deal memo, artic­u­lat­ing this con­tin­gency.

Tell me if this is accept­able. I hope that it is, because it would save us from a lot of legal has­sle.

When the site was launched, rather than the imme­di­ate 210 month­ly sub­scribers and 140 year­ly that Lira was expect­ing as a min­i­mum (he had hopes of hit­ting 1,000 on day one), the actu­al signup was far low­er: 98 in total, with the major­i­ty of those being year­ly sub­scribers.

Table 1: August start­up sub­scrip­tions

Mem­ber­ship Num­ber of Mem­bers Sub­scrip­tion Fee Total
Month­ly Mem­ber­ships 38 $25.00 $950.00
Month­ly Mem­ber­ships 1 $0.01 $0.01
Year­ly Mem­ber­ships 57 $250.00 $14,250.00
Year­ly Mem­ber­ships 2 $225.00 $450.00
Totals (A) 98   $15,650.01

With a 50:50 rev­enue share, my gross income for that first month was about $7500 (ver­sus ini­tial costs of about $2500 for video pro­duc­tion). That was still rev­enue pos­i­tive, but a long way below Lira’s opti­mistic fore­casts.

The sec­ond month was some­what bet­ter, but here I made an error that exag­ger­at­ed the appar­ent per­for­mance: I thought I was get­ting infor­ma­tion on new sub­scrip­tions only—so that the 108 new month­ly sub­scribers for Sep­tem­ber were in addi­tion to the 38 who signed up back in August.

Table 2: Sep­tem­ber 2012

Mem­ber­ship Num­ber of Mem­bers Sub­scrip­tion Fee Total
Month­ly Mem­ber­ships ($25) 108 $25.00 $2,700.00
Month­ly Mem­ber­ships ($40) 6 $40.00 $240.00
Year­ly Mem­ber­ships ($225) 3 $225.00 $675.00
Year­ly Mem­ber­ships ($250) 65 $250.00 $16,250.00
Year­ly Mem­ber­ships ($400) 2 $400.00 $800.00
Mem­ber­ship Refund 1 -$215.00
Totals (A) 184   $20,450.00

In fact that was not the case. The year­ly sub­scribers were new, but the month­ly sub­scribers includ­ed those who had con­tin­ued on from the pre­vi­ous month. So I false­ly believed that the rev­enue I was see­ing from month­ly sub­scribers would grow and be quite sub­stan­tial over time. This was my own mis­take here, not Lira’s.

Table 3: Octo­ber 2012

Mem­ber­ship Num­ber of Mem­bers Sub­scrip­tion Fee Total
Month­ly Mem­ber­ships ($25) 106 $25.00 $2,650.00
Month­ly Mem­ber­ships ($40) 15 $40.00 $600.00
Year­ly Mem­ber­ships ($250) 1 $250.00 $250.00
Year­ly Mem­ber­ships ($400) 6 $400.00 $2,400.00
Mem­ber­ship Refund 2 -$215.00 -$430.00
Totals (A) 128   $5,470.00

By Novem­ber, when I saw these results, I had the addi­tion­al dis­trac­tion of UWS’s pro­pos­al to ter­mi­nate its eco­nom­ic degree. That wiped out most of the next five months for me—firstly in a cam­paign to try to get UWS to reverse its deci­sion, and then in indus­tri­al rela­tions pro­ceed­ings that ulti­mate­ly result­ed in me tak­ing redun­dan­cy from UWS on March 30th. The finan­cial via­bil­i­ty of this site, which had been a sec­ond tier issue for me, became first tier.

Table 4: Novem­ber 2012

Mem­ber­ship Num­ber of Mem­bers Sub­scrip­tion Fee Total
Month­ly Mem­ber­ships ($25) 96 $25.00 $2,400.00
Month­ly Mem­ber­ships ($40) 19 $40.00 $760.00
Year­ly Mem­ber­ships ($250) 0 $250.00 $0.00
Year­ly Mem­ber­ships ($400) 2 $400.00 $800.00
Mem­ber­ship Refund 0 $0.00
Totals (A) 117   $3,960.00

With my false belief that the fig­ures I was see­ing were for new signups of both month­ly and year­ly sub­scribers, I became con­cerned at what appeared to be a grow­ing dis­crep­an­cy between what I was receiv­ing (half of the totals shown in these tables) and what I thought the site was earn­ing.

Table 5: Decem­ber 2012

Mem­ber­ship Num­ber of Mem­bers Sub­scrip­tion Fee Total
Month­ly Mem­ber­ships ($25) 88 $25.00 $2,200.00
Month­ly Mem­ber­ships ($40) 26 $40.00 $1,040.00
Year­ly Mem­ber­ships ($250) 0 $250.00 $0.00
Year­ly Mem­ber­ships ($400) 2 $400.00 $800.00
Mem­ber­ship Refund 0 $0.00
Totals (A) 116   $4,040.00

When I saw the Decem­ber results, I chal­lenged Lira over this:

My email Jan­u­ary 17th

We need to talk–urgently.

I was wait­ing until this mon­th’s pay­ment to con­firm this, but you are only trans­fer­ring to me the rev­enue from new signups: you are not giv­ing me the pay­ments from con­tin­u­ing cus­tomers.

The dis­crep­an­cy is now enor­mous: on my cal­cu­la­tions you owe me $9,977–see the attached spread­sheet. The two tables below–copied from that sheet–confirm that your pay­ments to me to date are only for new signups, and do not include month­ly pay­ments by exist­ing $25 and $40 per month sub­scribers.

Table 6: My erro­neous cal­cu­la­tions

New Pay­ments $15,650 $20,665 $5,900 $3,960 $4,040
Minus Costs $37 $715 $1,131 $272 $171
Net Halved $7,806 $9,975 $2,385 $1,844 $1,935
Actu­al Pay­ment $7,806 $9,975 $2,385 $1,844 $1,935
Dif­fer­ence $0 $0 $0 $0 $0
Total Pay­ments $15,613 $20,900 $8,659 $10,828 $14,169
Minus Costs $37 $715 $1,131 $272 $171
Half Total Pay­ments minus costs $7,788 $10,092 $3,764 $5,278 $6,999
Actu­al Pay­ment from ECM $7,806 $9,975 $2,385 $1,844 $1,935
Dis­crep­an­cy -$19 $117 $1,380 $3,434 $5,065
Owed $9,977

He then cor­rect­ed me:

Steve, I think you are severe­ly mis­tak­en.

The pay­ments we have made to you are for ALL cus­tomers, both new and ongo­ing.

The absolute­ly eas­i­est way to con­firm this is to go to the account you have, and run an account sum­ma­ry, start­ing from August 25, 2012, when we start­ed the site. Then add up all the pay­ments, less the cred­it card pro­cess­ing fees which we agreed to split.

You will see that there is no dis­crep­an­cy. Please check the infor­ma­tion, and you will con­firm this for your­self.

I checked, and Lira was right: the total shown each month for month­ly sub­scribers was the absolute total, not new signups. I still find this puz­zling: when I have signed up for a month­ly ser­vice (as I have for the New York Times and Syd­ney Morn­ing Her­ald) the pay­ment is tak­en out each month unless I delib­er­ate­ly can­cel. I thought I’d see can­cel­la­tions in the month­ly report, but clear­ly it did­n’t include that (the spread­sheet comes from the pay­ment gate­way

So I sud­den­ly real­ized that the site was far from profitable—given my pro­duc­tion costs of about $2500 a month—and asked Lira to shut down year­ly mem­ber­ships while I decid­ed what to do.

This is why the videos stopped being made—on top of the time I was los­ing to the indus­tri­al rela­tions dis­pute with UWS, and get­ting ready for the Kick­starter cam­paign to raise devel­op­ment funds for my Min­sky soft­ware (which ran from Feb­ru­ary 9 to March 18). I was now con­scious that the site was cost­ing me more than I was actu­al­ly earn­ing from it. My objec­tive had nev­er been the mon­ey itself—first and fore­most, I was hop­ing to “buy time” using its rev­enue stream so that I could focus on my research—so the fact that it was los­ing mon­ey as well as cost­ing my time made it a dou­bly bad project.

I there­fore stopped record­ing videos and cut back to just pro­vid­ing my week­ly blog col­umn here pri­or to its pub­li­ca­tion on Busi­ness Spec­ta­tor (more about this below) and asked Lira to ter­mi­nate the year­ly mem­ber­ship option immediately—since this made it hard­er to ulti­mate­ly ter­mi­nate this site. Then I received the Jan­u­ary state­ment on March 2nd—and saw that year­ly mem­ber­ships were still being tak­en.

Table 7: Jan­u­ary 2013

Mem­ber­ship Num­ber of Mem­bers Sub­scrip­tion Fee Total
Month­ly Mem­ber­ships ($25) 75 $25.00 $1,875.00
Month­ly Mem­ber­ships ($40) 27 $40.00 $1,080.00
Year­ly Mem­ber­ships ($250) 0 $250.00 $0.00
Year­ly Mem­ber­ships ($400) 6 $400.00 $2,400.00
Mem­ber­ship Refund 0 $0.00
Totals (A) 108   $5,355.00

I wrote to Lira insist­ing that he ter­mi­nate the year­ly mem­ber­ship option as he had agreed to do a month ear­li­er:

My email of March 6th

Two things:

First­ly can you change the account for my pay­ments? I am shut­ting down my busi­ness account and just going with my per­son­al account. See details below (this is less impor­tant than the sec­ond issue how­ev­er).

Sec­ond­ly, I notice that vir­tu­al­ly half the income this month came from anoth­er 6 year­ly sub­scribers at $400. This is just mon­ey we are going to have to pay back when the site is ter­mi­nat­ed. Can you please, as we dis­cussed, END year­ly mem­ber­ships now? I want to keep our refunds to a min­i­mum when the site is final­ly shut.


On March 31st, I received the Feb­ru­ary statement—and saw that there were still year­ly sub­scribers sign­ing up.

Table 8: Feb­ru­ary 2013

Mem­ber­ship Num­ber of Mem­bers Sub­scrip­tion Fee Total
Month­ly Mem­ber­ships ($25) 64 $25.00 $1,600.00
Month­ly Mem­ber­ships ($40) 30 $40.00 $1,200.00
Year­ly Mem­ber­ships ($250) 0 $250.00 $0.00
Year­ly Mem­ber­ships ($400) 2 $400.00 $800.00
Mem­ber­ship Refund 0 $0.00
Totals (A) 96   $3,600.00


My email of April 1st

Thank you.

Two issues:

(1) Please ter­mi­nate the avail­abil­i­ty of year­ly mem­ber­ships, as we dis­cussed and agreed pre­vi­ous­ly.

(2) Please retain and addi­tion­al $1 for your­self from the next pay­ment and trans­fer own­er­ship of to me, as allowed for in our agree­ment.

(3) Please arrange for me to have admin­is­tra­tor’s rights on the blog.

I received no reply to this email, nor to any sub­se­quent email. Nor have I received pay­ments for March (or April), which on our agree­ment I should have received by April 30th at the lat­est.

I had planned to wait until after May 30th to write this post, since by then I would know whether he was adding injury to insult by hang­ing on to all the blog rev­enue, as well as ignor­ing my ini­tial­ly polite­ly word­ed but ulti­mate­ly insult­ing emails (see the end of this post for the set). But today I received a jus­ti­fi­ably angry email from one of you about how Lira has been treat­ing sub­scribers:

Please spend a few min­utes to pro­vide com­mu­ni­ca­tion sup­port for your web­site, as there is no means to com­mu­ni­cate regard­ing billing issues. Please instruct your sup­port staff to cred­it my cred­it card for two charges of $40.00. This is time con­sum­ing to get these charges reversed. You would do bet­ter to not have a web site charg­ing folks if you do not pro­vide a means to com­mu­ni­cate regard­ing these billings. see below.

 May 16, 2013 12:22 PM

I have con­tact­ed the tele­phone num­ber pro­vid­ed at 702–739-6883 (num­ber list­ed on the cred­it card charge) and I have not been able to speak with a per­son at this list­ed num­ber receiv­ing a voice mes­sage “There is no one to answer your call”. My cred­it card has been charged twice at $40.00 dol­lars each time, the lat­est charge applied on May 8, 2013 with num­ber F9GHCZRJM. When I go online to can­cel this ser­vice, I am pro­vid­ed with a mes­sage that I am not a paid sub­scriber, ” Noth­ing to can­cel as you are not a paid mem­ber.”

I have nev­er been able to access the paid sub­scriber site. As Steve Keen will be in Seat­tle on May 23rd I intend to pub­licly ques­tion him at his lec­ture as to his busi­ness prac­tices where he has a web ser­vice upon which charges are made but fails to pro­vide a means of com­mu­ni­ca­tion to resolve this type of issue or to can­cel ser­vice.

Please cred­it the two charges made to may account at $40.00 each. I will be con­tact­ing Visa should you dis­re­gard my request for a cred­it. Thank you for your res­o­lu­tion of this mat­ter.

I’ve replied to this sub­scriber rec­om­mend­ing him to con­tact Visa to can­cel the pay­ment. Hope­ful­ly most of you will be able to can­cel via, but if not, please can­cel via your cred­it card provider instead.

I apol­o­gize for the unsat­is­fac­to­ry saga this has been for you as subscribers—and for the fact that unfore­seen events (such as UWS’s deci­sion to ter­mi­nate its eco­nom­ics degree and my ensu­ing redundancy—the sort of thing no eco­nom­ic the­o­ry could ever antic­i­pate!) pre­vent­ed me from keep­ing you informed as events unfold­ed, and act­ing in a more time­ly fash­ion.

I appre­ci­ate that most of you were here pri­mar­i­ly to sup­port me in my endeav­or to reform eco­nom­ics. I hope you accept that this site, rather than being a means to that end, had become yet anoth­er hin­drance to it, and it there­fore has to go.

My prob­lem here is, with Lira being total­ly unco­op­er­a­tive and reneg­ing on var­i­ous agreements—most impor­tant­ly, the trans­fer of own­er­ship of the site back to me for the token amount of $1—that I can’t eas­i­ly shut this site down. I will instead have to go through the labo­ri­ous process of try­ing to get own­er­ship giv­en back to me via appeal­ing to domain name serv­er man­age­ment sys­tems.

In the mean­time, this site will con­tin­ue adver­tis­ing as if it is mine, and since I don’t have admin­is­tra­tor rights on this site, there will be noth­ing that I can do about it—apart from warn sub­scribers by mak­ing this my last post, and putting the news out by social media. It will serve as a les­son to me in future to be much more cau­tious in whom I accept as a busi­ness part­ner.

The Future

I’m hap­py to dis­cuss this here, but my plans for the future are:

  • To con­tin­ue writ­ing for Busi­ness Spec­ta­tor (see below on that);
  • To post the first cou­ple of para­graphs to each sto­ry on Debt­watch with a link to Busi­ness Spec­ta­tor; and
  • Per­haps to put the full posts on Debt­watch behind a much cheap­er pay­wall than here—maybe $2 a month. And if I can to restrict com­ments on Debt­watch to those who are sub­scrib­ing. This is part­ly to get some sup­ple­ment to my post-employ­ment income after my redun­dan­cy from UWS, and also to restrict the amount of work involved in keep­ing up with com­ments on Debt­watch.

Business Spectator

Busi­ness Spec­ta­tor is an inde­pen­dent fac­tor in all this that has enabled me to con­tin­ue func­tion­ing despite the loss of my income from UWS. in August 2012, Busi­ness Spec­ta­tor agreed to pay me for my week­ly col­umn, so long as the con­tent was not freely avail­able else­where. The sum isn’t great—it’s about equiv­a­lent to the medi­an wage in Australia—but with my super­an­nu­a­tion sav­ings as a fall­back I can man­age to sur­vive and func­tion as an inde­pen­dent schol­ar.

Unanswered emails to Lira

Feb­ru­ary 1st

Dear Gon­za­lo,

Please quar­an­tine this and the oth­er recent year­ly from our pay­ments. I don’t want to get income from this which we then have to refund most of soon after.

Feb­ru­ary 21st

Dear Gon­za­lo,

We agreed to not allow any more year­lies. This is a sec­ond one this month. Please shut down the year­ly mem­ber­ship option and quar­an­tine these two pay­ments to min­i­mize our future refunds when I ter­mi­nate the site.

March 9th

Gon­za­lo, PLEASE CANCEL Year­ly sub­scrip­tions. I don’t like shout­ing, but we agree to this over a month ago.

March 14th


This is at least the tenth year­ly sub since we agreed to shut year­ly subs down. Either do so or give me admin rights so that I can do it myself.

March 20th

This is the sixth email I’ve sent ask­ing you to live up to your agree­ment to end the year­ly subs.

I’ll make this sim­ple Gon­za­lo: shut down the year­ly subs, or I’ll shut the blog down.

March 31st:

Dear Gon­za­lo,

As per our agree­ment, please retain $1 from my next pay­ment as pay­ment to you to repur­chase the domain Please also arrange for me to be giv­en admin­is­tra­tive rights over the blog.

April 3rd

Dear Gon­za­lo,

At last count I have sent you sev­en emails ask­ing you to can­cel year­ly sub­scrip­tions as agreed, and two to trans­fer own­er­ship of back to me for $1 as agreed. I have received no replies.

It occurred to me that this may be because you have not received them: a num­ber of peo­ple have failed to receive emails from me recent­ly because their spam fil­ters block emails with short URLs.

I am there­fore send­ing this one with­out a short URL.

To repeat my requests:

Please can­cel the year­ly sub­scrip­tions: allow only month­ly from now on;

Retain $1 from my next month­ly pay­ment as the trans­fer fee to return own­er­ship of the domain to me;

Arrange for me to have admin­is­tra­tor rights on the blog; and final­ly

Please acknowl­edge receipt of this email.

April 27th

Fuck you Gon­za­lo! You agreed three months ago to ter­mi­nate year­ly mem­ber­ships.

Do it–and give me back own­er­ship and admin con­trol of–or I’ll con­duct our future cor­re­spon­dence on Twit­ter.

May 10th (to a new year­ly sub­scriber, cc’ed to Lira)

Dear Simon,

My first email to you has to be an apol­o­gy. Some months ago, Gon­za­lo Lira, my part­ner in this ven­ture, agreed to end year­ly sub­scrip­tions to this site. He has not imple­ment­ed that promise, despite repeat­ed emails from me request­ing him to do so.

So I am instead request­ing you to can­cel your year­ly sub­scrip­tion imme­di­ate­ly. If you wish to sub­scribe, please take out a month­ly sub­scrip­tion instead.

I will be explain­ing the rea­sons for end­ing year­ly sub­scrip­tions short­ly on the blog.

May 11th (to a new year­ly sub­scriber, cc’ed to Lira)

Dear Susan

My first email to you has to be an apol­o­gy. Some months ago, Gon­za­lo Lira, my part­ner in this ven­ture, agreed to end year­ly sub­scrip­tions to this site. He has not imple­ment­ed that promise, despite repeat­ed emails from me request­ing him to do so.

So I am instead request­ing you to can­cel your year­ly sub­scrip­tion imme­di­ate­ly. If you wish to sub­scribe, please take out a month­ly sub­scrip­tion instead.

I will be explain­ing the rea­sons for end­ing year­ly sub­scrip­tions short­ly on the blog.

May 15th

As well as not reply­ing to about 8 emails, you are now late in mak­ing pay­ments. The last pay­ment I received from you was for Feb­ru­ary, on April 2nd

On past sched­ules, you should have sub­mit­ted March by now at least.

Please make the out­stand­ing pay­ments imme­di­ate­ly, and trans­fer own­er­ship of the site back to me for $1 as agreed, and shut down year­ly mem­ber­ships.

If I don’t receive a response and pay­ments, I will ini­ti­ate alter­na­tive meth­ods for redress.