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March 8, 2013

Latest Posts from Economist's View


Latest Posts from Economist's View


Posted: 01 Mar 2013 01:17 AM PST
Will Ben Bernanke help to end "the elite obsession with deficits"?:
Ben Bernanke, Hippie, by Paul Krugman, Commentary, NY Times: We're just a few weeks away from a milestone...: the start of the Iraq war. What I remember from that time is the utter impenetrability of the elite prowar consensus. If you tried to point out that the Bush administration was obviously cooking up a bogus case for war..., that the risks and likely costs of war were huge; well, you were dismissed as ignorant and irresponsible. ...
And,... remarkably, a very similar story has played out over the past three years, this time about economic policy. Back then, all the important people decided that an unrelated war was an appropriate response to a terrorist attack; three years ago, they all decided that fiscal austerity was the appropriate response to an economic crisis caused by runaway bankers, with the supposedly imminent danger from budget deficits playing the role once played by Saddam's alleged weapons of mass destruction.
Now, as then, this consensus has seemed impenetrable to counterarguments, no matter how well grounded in evidence. And now, as then, leaders of the consensus continue to be regarded as credible even though they've been wrong about everything..., while critics of the consensus are regarded as foolish hippies even though all their predictions — about interest rates, about inflation, about the dire effects of austerity — have come true.
So here's my question: Will it make any difference that Ben Bernanke has now joined the ranks of the hippies?
Earlier this week, Mr. Bernanke ... spoke more clearly and forcefully on fiscal policy than ever before... First of all, he pointed out that the budget picture just isn't very scary... He then argued that given the state of the economy, we're currently spending too little, not too much... Finally, he suggested that austerity in a depressed economy may well be self-defeating...
Regular readers may find these propositions familiar, since they're pretty much what I and other progressive economists have been saying all along. But we're irresponsible hippies. Is Ben Bernanke? (Well, he has a beard.)
The point is not that Mr. Bernanke is an unimpeachable source of wisdom..., the point is that Mr. Bernanke's apostasy may help undermine the argument from authority — nobody who matters disagrees! — that has made the elite obsession with deficits so hard to dislodge.
And an end to deficit obsession can't come a moment too soon. ... A misguided elite consensus has led us into an economic quagmire, and it's time for us to get out.
Posted: 01 Mar 2013 12:03 AM PST
Posted: 28 Feb 2013 04:47 PM PST
Traveling -- a quick one from the road: Is this the answer?:
Scientists call for legal trade in rhino horn: Four leading environmental scientists today urged the international community to install a legal trade in rhino horn – in a last ditch effort to save the imperiled animals from extinction. ...
"Current strategies have clearly failed to conserve these magnificent animals and the time has come for a highly regulated legal trade in horn", says lead author Dr Duan Biggs of the ARC Centre of Excellence for Environmental Decisions (CEED) and University of Queensland.
"As committed environmentalists we don't like the idea of a legal trade any more than does the average member of the concerned public. But we can see that we need to do something radically different to conserve Africa's rhino."
The researchers said the Western Black Rhino was declared extinct in 2011. There are only 5000 Black Rhinos and 20,000 White Rhinos left, the vast majority of which are in South Africa and Namibia.
"Poaching in South Africa has, on average, more than doubled each year over the past 5 years. Skyrocketing poaching levels are driven by tremendous growth in the retail price of rhino horn...
World trade in rhino horn is banned under the CITES Treaty - and this ban, by restricting supplies of horn, has only succeeded in generating huge rewards for an illegal high-tech poaching industry, equipped with helicopters and stun-darts, which is slaughtering rhinos at alarming rates.
Attempts to educate Chinese medicine consumers to stop using rhino horn have failed to reduce the growth in demand, they said.
The scientists argue that the entire world demand for horn could be met legally by humanely shaving the horns of live rhinos, and from animals which die of natural causes. Rhinos grow about 0.9kg of horn each year, and the risks to the animal from today's best-practice horn harvesting techniques are minimal. The legal trade in farmed crocodile skins is an example of an industry where legalization has saved the species from being hunted to extinction. ... A legal trade in rhino horn was first proposed 20 years ago, but rejected as 'premature'.
However, the time has now come for a legal trade in horn, says Dr Biggs. ... "Legitimizing the market for horn may be morally repugnant to some, but it is probably the only sensible way to prevent extinction of Africa's remaining rhinos," the scientists conclude.
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Their paper Legal Trade of Africa's Rhino Horns by Duan Biggs, Franck Courchamp, Rowan Martin and Hugh Possingham, appears in the latest edition of the journal Science (March 1).
Posted: 28 Feb 2013 10:05 AM PST
I was thinking along the same lines:
So much for 'economic uncertainty', by Steve Benen: In 2009 and 2010, the single most common Republican talking point on economic policy included the word "uncertainty." I did a search of House Speaker John Boehner's (R-Ohio) site for the phrase "economic uncertainty" and found over 500 results, which shows, at a minimum, real message discipline.
The argument was never especially compelling from a substantive perspective. For Boehner and his party, President Obama was causing excessive "uncertainty" -- through regulations, through the threat of tax increases, etc. -- that held the recovery back. Investors were reluctant to invest, businesses were reluctant to hire, traders were reluctant to trade, all because the White House was creating conditions that made it hard for the private sector to plan ahead.
It was a dumb talking point borne of necessity -- Republicans struggled to think of a way to blame Obama for a crisis that began long before the president took office -- but the GOP stuck to it.
That is, Republican used to stick to it. Mysteriously, early in 2011, the "economic uncertainty" pitch slowly faded away without explanation. I have a hunch we know why: Republicans decided to govern through a series of self-imposed crises that have created more deliberate economic uncertainty than any conditions seen in the United States in recent memory. ...
It's hard to count all of the really bad predictions Republicans have made about interest rates, inflation, uncertainty, and so on in their attempt to use the recession to make ideological and political gains. But people still seem to listen.
It's not the uncertainty about what might happen as much as it's policy, what actually has happened -- austerity during a recession -- that's problematic. Now we are about to get more austerity that is ill-timed -- as Ben Bernanke said this week it's far too front-loaded -- and very poorly designed. It was constructed after all to motivate parties to action, so it is intentionally loathsome.
The Fed can be frustrating. Congress, the modern Republican contingent in particular, is ridiculous. It's hurting our ability to recover from the recession and provide jobs for millions of unemployed workers struggling to make ends meet each month.

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