Saturday, May 31, 2014

Early Observations on 2016 from The Far Center

The Far Center thus takes an early look at Jeb Bush and John Kasich as well as Hillary Clinton.

Any look at the electoral map shows a continued divide between red states and blue states with about a dozen swing states. There are large solidly Democratic states such as California, New York, and Massachusetts. Republicans will not have much of a chance to win the 2016 Presidential election unless they can win Texas, Florida, and Ohio. The country is also more likely to elect a center-left or center-right candidate than a far right or far left candidate. None of the candidates from the last Republican primary meet this criteria after each declared that they would not accept a ratio of 10 to 1 on budget cuts and raising taxes to help balance the budget. On the Democratic side Hillary Clinton is the odds on favorite if she decides to run.

Friday, May 23, 2014

Economists, Politics, and Global Poverty (Part IV)
A review of books that are important critiques of economists.

Money, Blood, and Revolution: How Darwin and the doctor of King Charles I could turn economics into a science

-- by George Cooper

“The premise of this book is that the internal inconsistencies between economic theories -- the apparently unresolvable debates between leading economists and the incoherent policies of our governments -- are symptomatic of economics being in crisis, specifically a scientific crisis.”

-- from the book cover

“A must-read”

-- The Economist

“George Cooper framed it so well in his book.”

-- Wall Street Journal

This book is interesting first due to its historical and innovative perspective. It also has a brief summary of the some of the competing schools of economic thought. Cooper asserts that economics is a broken science that now believes multiple inconsistent things at the same time. He refers to The Structure of Scientific Revolutions by Thomas Kuhn and to the ideas of Charles Darwin and William Harvey, the doctor to King Charles I, to suggest a better way to think about our economics.

Cooper states that “the problem for mainstream economic theory is that the experimental evidence is that the way we choose to arrange our societies has enormous influence on how our economies actually work. However, there is simply no coherent way to integrate this observation into the neoclassical paradigm.”

Cooper suggests a “paradigm shift” that involves “thinking of economic growth as being generated by a circulatory flow of wealth through society. In this model, wealth is moved up through the social pyramid by the activity of the private sector and is recirculated back downward via the activity of the state sector. Cooper describes this as a creative antagonism that lets us exploit the best of our competitive nature while managing the worst of our selfish nature.

I would observe that in Das Kapital (1867-1894) that Marx predicted the fall of capitalism.

Why didn’t that happen in the United States? It was in large part due to the political process of our constitutional democracy being able to both place regulations on laissez faire capitalism and achieve income redistribution with the 16th amendment (1913) and a tax code. In this context, Cooper’s suggestions look less like a paradigm shift than a recognition of the strength and balance of our constitutional democracy.

Thursday, May 22, 2014

Economists, Politics, and Global Poverty (Part III)
A review of books that are important critiques of economists.

The Tyranny of Experts: Economists, Dictators, and the Forgotten Rights of the Poor

-- by William Easterly

“Easterly shows that many of the contemporary debates about the nature of development have their roots in history and he argues that the rights of the individual and democratic values should not be trampled on by those seeking faster economic growth.”

-- Joseph Stiglitz, Nobel Prize Winner

“Bill Easterly is simply the most interesting and provocative economist writing on development topics today.”

-- Francis Fukuyama

“Over the last century, global poverty has largely be viewed as a technical problem that merely requires the right “expert” solutions. Yet all too often, experts recommend solutions that fix immediate problems without addressing the political oppression that created the problems in the first place,”

-- from the book cover

“Easterly argues that only a model of development predicated on the respect for the individual rights of poor people will be capable of ending global poverty.”

-- from the book cover

This book is recommended first for its history of economic development dating back to twelfth-century Italy. Easterly then traces the fight against global poverty by “experts” in development who often sided with dictators against their against their subjects. This includes US foreign policy makers dating back to pre-WWII China who have sided with autocrats in a technological approach to development. Easterly then argues that the stereotypes of wise technocrats from the West and helpless victims from the Rest, has to end. Real progress he contends “will only be achieved when the current ideology of development is rejected in favor of policies founded on the idea that all men are truly created equal.”

Easterly is particularly critical of the World Bank Bank charter set up by the the Bretton Woods conference in 1944, which contains the “nonpolitical cause.” The bank and its officers “shall not interfere in the political affairs of any member; nor shall they be influenced in its decisions by the political character of the government of the member or members concerned. Only economic considerations shall be relevant to their decisions,” Easterly concludes that, “The only time the noninterference cause is binding, apparently, is in preventing the Bank from recognizing any democratic rights of any poor individuals in any of their members countries.” He states that “Having experts in charge of solving society’s problems turns thing over to agents who face neither a market test nor a democratic test …. they suffer neither economic or political penalties.”

Easterly argues that, “it is time at last for the silence on unequal rights for the rich and the poor to end. It is time at last for all men and women to be equally free.”

Saturday, May 17, 2014

Economists, Politics, and Global Poverty (Part II)
A reviews of books that are important critiques of economists.

“The Idealist is a profound and moving story of what happens when the abstract theories of a brilliant, driven man meet the realities of human life.”
-- from the book cover

“A riveting narrative that must be read to understand why the over $700 billion pumped into Africa by the West since 1960 has achieved so little. This powerful book will shake up the foreign aid and development community.”
-- George Ayittey, president of the Free Africa Foundation and author of Africa Unchained

“A powerful exposé of hubris run amok, drawing on the touching accounts of real-life heroes fighting poverty on the front lines.”
-- Robert Calderisi, author of The Trouble with Africa

We have no water. We have no oil. We have no minerals. If you say to me, “One day you will grow crops,” I will ask you, “From where will you get the water?” If you say to me, “One day there will be industry,” I will ask you, “From where will you get water?”
-- A quote from the book by Ahmed Maalim Mohamed

Jeffery Sachs, a celebrated economist from Harvard and Columbia and author of The End of Poverty, in 2006 launched the Millennium Villages Project in Africa backed by $120 million raised from donors. This book by Nina Monk is a first hand account of both the vision and the real-life challenges and difficulties that confront this type of academic, centralized, and idealist approach to solving poverty in Africa.

In the early 1990’s, Jeffery Sachs and and a dozen colleagues from the Harvard Institute for International Development advised a type of “shock therapy” reform to bring markets and capitalism to Russia after the fall of communism. A qoute from The Idealists states that Sachs was naïve and that he was defeated by a massively bloated and corrupt economy. “In one decade, between 1989 and 1999, Russia’s GDP dropped by half. State assets were systematically looted, and anything of value -- raw materials, for instance -- wound up in the hands of a few clever men.”

Russian communism had described itself in economic terms, when in fact it was a totalitarian political regime. Communism advocated, at least in theory, equality as the common ownership of the means of production, but it has in actuality denied political equality as well as the moral agency of other people. In response to the fall of communism our economists all proposed capitalism and the academics, the media, and our government all began to refer to our government as a capitalistic democracy rather than a constitutional democracy. The the appropriate response to the fall of communism should have been a constitutional democracy.

In my book, The Moral Foundations of United States Constitutional Democracy; An Analytical and Historical Inquiry into the Primary Moral Concept of Equality (1992), I wrote the following concerning this issue:

It would be ironic to accept as a premise of public discourse on constitutional democracy the ideology of Marxism which portrays the economic system to be determinative of the political system, rather than just an integral and interdependent part of society and the government. What is important to recognize is that is that our economic system, for example the extent to which we are a regulated capitalism or a social welfare state, is determined by constitutional and legislative political processes based on equality. Given such political processes based on equality, it is not irrational for a people to recognize defined property rights, reward production and merit, and incorporate several aspects of distributive justice.

Russia, without a check on governmental powers, in the early 1990’s became a kleptocracy which benefitted mostly members of the old KGB. It is now under Putin becoming an autocracy.

Saturday, May 10, 2014

Economists, Politics, and Global Poverty (Part I)
A reviews of books that are important critiques of economists.

Thus is the first in a series of four book review blogs concerning economists, politics, and global poverty.

The first recommended book is The Bottom Billion (2005) by Paul Collier. This is a fairly balanced account of why one sixth of the world’s population (The Bottom Billion) still live in poverty. 70% of those counties that remain in poverty are in Africa. Collier describes the major causes of poverty to be:
  1. Civil war.
  2. Mineral wealth which supports the government rather than taxes.
  3. Being landlocked and dependent on neighboring counties for transportation.
  4. Poor governance.
Much of this can be understood by reading a book review by Niall Ferguson.

Saturday, May 3, 2014

Reconsidering the Death Penalty

    “We do have to, as a society, ask ourselves some difficult and profound questions.”
                           - President Obama
  • Obama calls for death penalty review after botched execution.

  • No Humane way to carry out the death penalty

    "When I read about the crimes Lockett committed, I wish I could support capital punishment. When I read about what Warner did, I want to strangle him with my own hands. But revenge is not the same thing as justice, and karmic retribution is not a power I trust government to exercise. The death penalty has no place in a civilized society."

  • Oklahoma botched Execution

    "What went wrong Tuesday in Oklahoma "will not only cause officials in that state to review carefully their execution procedures and methods," said Richard W. Garnett, a former Supreme Court law clerk who now teaches criminal and constitutional law at the University of Notre Dame, "it will also almost prompt many Americans across the country to rethink the wisdom, and the morality, of capital punishment."

  • Doctors in the death chamber

    "Physicians have to break both their Hippocratic Oath and American Medical Association ethical code to participate in executions."

  • Reconsideration of the Death Penalty in Ohio