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The Federal Reserve on… The Federal Reserve

 

http://www.federalreserveeducation.org/fed101/fedtoday/FedTodayAll.pdf (check for yourself if you don’t believe it)

 

Page 29:

Myth:

When the Fed prints money for banks it increases the national debt.

[Nice Strawman, should have stuck to that…]

REALITY:

Federal Reserve Banks do not print money, they manage the inventory of the existing stock of
currency. Money is printed by the Bureau of Printing and Engraving, an agency of the U.S.
Treasury Department. Government debt is generated by government borrowing.The amount
of bor rowing, measured by the deficit, is not decided by the Fed.The government’s debt and
deficit are the result of the budgetary decisions of the Congress and President.

 

Ok, then…

Myth:

The Fed is not a good supervisor of banks because it allows banks to keep only a fraction of
their deposits on hand.

REALITY:

The fact that banks are required to keep on hand only a fraction of the funds deposited with
them is a function of the banking business. Banks bor row funds from their depositors (those
with savings) and in turn lend those funds to the banks’ borrowers (those in need of funds).
Banks make money by charging borrowers more for a loan (a higher percentage interest rate)
than is paid to depositors for use of their money. If banks did not lend out their available funds
after meeting their reserve requirements, depositors might have to pay banks to provide
safekeeping services for their money.
For the economy and banking system as a whole, the practice of keeping only a fraction of
deposits on hand has an important cumulative effect. Referred to as the fractional reserve
system, it permits the banking system to “create”money.

Bob Murphy’s Response to Cochrane (who responded to Krugman)

 

Here’s why I like Bob Murphy, and why it pains me to see him go off the deep end so often when it comes to non-economic issues.

Monday, September 14, 2009

==========
Cochrane Threatens Austrians More Than Krugman Ever Did
By Robert P. Murphy

Although some Austrian economists (e.g. Mario Rizzo) expressed disappointment with Chicago University economist John Cochrane's response to Paul Krugman's infamous NYT Magazine piece, for the most part the people on "my side" have high-fived Cochrane for kicking sand in Krugman's face.
This is a very short-sighted view. Just because someone gets in a fight with someone who we can't stand--and I've criticized Krugman enough to have credibility on that score--doesn't mean we should endorse any old arguments. There was quite a bit in Cochrane's response that should alarm an Austrian economist, and in fact his views are arguably more dangerous to the Austrian alternative than Krugman. After all, all Krugman did was ignore us. But Cochrane ignored us and defended himself from Krugman in a way that "proves" Austrian economics is a collection of second-rate ideas. I don't see how any Austrian economist can overlook all of that, just because he likes Cochrane's conclusions that "Keynesian economics is awful" and "Paul Krugman is a jerk," true those conclusions may be. In this brief essay I'll quote from Cohrane and show how his ostensible attack on Krugman actually takes down Austrian economics as collateral damage.

Most of all, [Krugman's article is] sad. Imagine this weren’t economics for a moment. Imagine this were a respected scientist turned popular writer, who says, most basically, that everything everyone has done in his field since the mid 1960s is a complete waste of time. Everything that fills its academic journals, is taught in its PhD programs, presented at its conferences, summarized in its graduate textbooks, and rewarded with the accolades a profession can bestow, including multiple Nobel prizes, is totally wrong. Instead, he calls for a return to the eternal verities of a rather convoluted book written in the 1930s, as taught to our author in his undergraduate introductory courses. If a scientist, he might be a global-warming skeptic, an AIDS-HIV disbeliever, a stalwart that maybe continents don’t move after all, or that smoking isn’t that bad for you really.

I don't need to dwell on why Austrians should dismiss this opening salvo from Cochrane. This is the incredibly naive Whig theory of history. Cochrane could just as easily blow up any Austrian who thinks Human Action contains better economic analysis than the latest edition of Mankiw.
(What's really ironic is that later in the essay, Cochrane says, "Occasionally sciences, especially social sciences, do take a wrong turn for a decade or two. I thought Keynesian economics was such a wrong turn. So let’s take a quick look at the ideas." So I'm not sure what to make of his opening paragraph. It seems Cochrane finds it "sad" that today's Keynesians would dare to use arguments that Cochrane had deployed against yesterday's Keynesians. A bit like the US government saying other countries shouldn't have nuclear weapons, because after all some evil regime might use them against civilians one day.)
After lamenting the sad day when someone would dare to criticize Nobel laureates (isn't Krugman a Nobel laureate?), Cochrane then says:

And that’s the biggest and saddest news of this piece: Paul Krugman has no interesting ideas whatsoever about what caused our current financial and economic problems, what policies might have prevented it, or what might help us in the future, and he has no contact with people who do. “Irrationality” and “spend like a drunken sailor” are pretty superficial compared to all the fascinating things economists are writing about it these days.

What is Cochrane talking about? Krugman has written boatloads on what could have prevented the current financial crisis. For example, Krugman has pointed to various types of (what he labels) "deregulation." And as for the "drunken sailor" wisecrack, Krugman has put up formal models showing his views on aggregate demand and so forth.
Don't get me wrong--I think Krugman is completely wrong (bordering on "insane" if that word is to have any meaning in reference to academics) in his views. But Cochrane's rude dismissal of Krugman is just as much a lie as anything Krugman said about Cochrane. So again, for those Austrians who can't stand what a dishonest thug Krugman is, you can't very well think Cochrane did a great job taking him down. Unless it's OK to lie for free markets (or in Cochrane's case, significantly-less-socialized markets).
But the next paragraph is what really made me lose it:

It’s fun to say we didn’t see the crisis coming, but the central empirical prediction of the efficient markets hypothesis is precisely that nobody can tell where markets are going – neither benevolent government bureaucrats, nor crafty hedge-fund managers, nor ivory-tower academics. This is probably the best-tested proposition in all the social sciences. Krugman knows this, so all he can do is huff and puff about his dislike for a theory whose central prediction is that nobody can be a reliable soothsayer.

How in the world can the proponents of the EMH continue to justify their belief in the EMH...by appeal to the EMH?!! I occasionally stop the radio channel seek on Christian stations, and it's hilarious during the short spots when they say things like, "A lot of people wonder how we can trust the Bible. But they need to read First Corinthians 5 where Paul writes..." (I am a Christian, by the way.)
There were plenty of economists (especially the Austrians--see e.g. Mark Thornton back in 2004) who "called" the housing boom. I don't know what exactly the EMH theorists make of this. Yes, you could argue that at any given time, you will have no shortage of economists (all of whom are ignorant of the EMH and the limits of their knowledge) shouting out all kinds of predictions, and then simple statistics show that some of them will be "proven right."
But on the other hand, what more could opponents of the EMH do than to point to the recent housing bubble?! When Cochrane says the EMH is the "best tested proposition in the social sciences," it is only because it is a tautology. Really, think about it: Do we need to go test the proposition that "if someone is making a bunch of money doing an activity, then other people will copy him and whittle away his returns, unless there is some reason that they don't"? (I'm exaggerating slightly, but when you read the actual empirical defenses of the EMH against its typical objections, you realize that it is a way of viewing the world. It is not a conclusion derived from the facts; it is a way of organizing the facts.)

Krugman writes as if the volatility of stock prices alone disproves market efficiency, and efficient marketers just ignored it all these years. This is a canard that Paul knows better than to pass on, no matter how rhetorically convenient....Data from the great depression has been included in practically all the tests. In fact, the great “equity premium puzzle” is that if efficient, stock markets don’t seem risky enough to deter more people from investing! Gene Fama’s PhD thesis was on “fat tails” in stock returns.

I am a bit out of my league here, but I still suspect that Cochrane is once again defining away his opponents. Again I ask: What would the world look like if the EMH were false? Wouldn't there be giant bubbles, during which many participants knew (or were quite sure) there was a bubble in progress--and invested and profited accordingly? (Of course that happened; don't let Cochrane fool you into thinking otherwise with his "best tested proposition in the social sciences" bluff.)
As far as the equity premium puzzle, proponents of Mandelbrot's "non-Gaussian" approach to financial markets say that it is the standard neoclassical use of a Gaussian distribution (calibrated with historical stock returns, yes including the Great Depression) that makes investors appear far too risk averse than we think they really are. What is happening is that the actual stock market is far more volatile than the calibrated models suggest. The housing bubble that just burst--as well as the 1987 crash--should have been "once-in-a-thousand-year events," according to the standard models that Krugman is attacking. (Of course I am making up that number. But the basic point is right.) That's one of the main themes in Nassim Taleb's work, that the value-at-risk and other risk measures used by Wall Street quants gave a false sense of security. I'm not accusing Cochrane of being ignorant of this fact, but at best he is throwing out a non sequitur to evade the very real problem that Krugman pointed out.
Oh wait, it turns out Cochrane isn't so sure about the usefulness of the EMH after all:

It is true and very well documented that asset prices move more than reasonable expectations of future cashflows. This might be because people are prey to bursts of irrational optimism and pessimism. It might also be because people’s willingness to take on risk varies over time, and is sharply lower in bad economic times. As Gene Fama pointed out in 1972, these are observationally equivalent explanations at the superficial level of staring at prices and writing magazine articles and opeds. Unless you are willing to elaborate your theory to the point that it can quantitatively describe how much and when risk premiums, or waves of “optimism” and “pessimism,” can vary, you know nothing. No theory is particularly good at that right now. Crying “bubble” is no good unless you have an operational procedure for identifying bubbles, distinguishing them from rationally low risk premiums, and not crying wolf too many years in a row.

There you have it, folks. After telling us that Krugman is attacking the best tested proposition in the social sciences, Cochrane falls back on, "Yeah we don't know anything, but neither do you. Until you can predict when a bubble will burst, stop complaining about my theory that predicts bubbles are impossible." (Again I am slightly exaggerating to make the point--but not much.)

In economics, stimulus spending ran aground on Robert Barro’s Ricardian equivalence theorem. This theorem says that debt-financed spending can’t have any effect because people, seeing the higher future taxes that must pay off the debt, will simply save more. They will buy the new government debt and leave all spending decisions unaltered. Is this theorem true? It’s a logical connection from a set of “if” to a set of “therefore.” Not even Paul can object to the connection.

Nope. Again I'm a bit out of my league here, but I am pretty sure that Cochrane is completely full of it on this point. Ricardian equivalence says that if the government finances a tax cut by running a higher deficit, while holding total government spending constant, that this won't change aggregate consumption, GDP, private sector investment, or interest rates. Rational taxpayers realize they will face higher tax bills in the future, and so they put aside the tax refund to roll over at interest and pay the bills. Thus, what the government gives back with the left hand, it borrows out of the private sector with the right. (Interest rates don't change because the extra saving by the private sector cancels out the extra borrowing by the government.)
Now there are all sorts of caveats in my argument above; it matters if it's a lump-sum tax cut versus a reduction in marginal tax rates, it matters if the current generation of workers will die before the higher taxes hit, etc. That's the tweaking of assumptions that Cochrane is referring to.
However, as Brad DeLong and Krugman have pointed out many times (in justified exasperation) on their blogs, Ricardian equivalence does not say that an increase in government deficit spending will be perfectly offset by the private sector. Think about it: The government decides to borrow and spend $100 billion more. Now for Ricardian "equivalence" to kick in, it means that the private sector must reduce its current consumption by $100 billion and increase savings by that amount, at the same interest rate. [UPDATE: I am assuming that the extra $100 billion in government spending is classified as "consumption" and not "investment."] In other words, faced with a higher future tax bill, the present generation decides to deal with it by slashing current consumption by $100 billion, while maintaining all future levels of consumption at their pre-announcement levels. Well why the heck would they do that? It would make a lot more sense to assume that consumers originally try to cushion the blow by reducing consumption across all future time periods. Then interest rates have to rise in the present in order to force consumers to make present consumption (and private-sector investment) channel an extra $100 billion into the government's coffers. So you can see, there is nothing "equivalent" going on here at all. Don't misunderstand--Krugman and DeLong are totally wrong in my opinion for thinking it's a good idea to boost "aggregate demand" (measured in nominal terms) by having the government borrow money and spend it. But Cochrane is totally wrong for invoking Ricardian equivalence to show that, to a first approximation, such a maneuver wouldn't boost aggregate demand in the present. (This is what Krugman is complaining about in the 7th paragraph here.)
Uh oh, now the Austrian reader isn't sure he can continue down this path with me. Suuuure, I didn't actually endorse deficit spending, but I suspiciously agreed with Krugman and DeLong when they claimed to defang one of the most popular Chicago School critiques of it (namely, that private sector reactions perfectly offset it in a frictionless world). Well maybe I can win you back with this final quotation from Cochrane:

Third, and most surprising, is Krugman’s Luddite attack on mathematics; “economists as a group, mistook beauty, clad in impressive-looking mathematics, for truth.” Models are “gussied up with fancy equations.”...
Again, what is the alternative? Does Krugman really think we can make progress on his – and my – agenda for economic and financial research — understanding frictions, imperfect markets, complex human behavior, institutional rigidities – by reverting to a literary style of exposition, and abandoning the attempt to compare theories quantitatively against data? Against the worldwide tide of quantification in all fields of human endeavor (read “Moneyball”) is there any real hope that this will work in economics?
No, the problem is that we don’t have enough math. Math in economics serves to keep the logic straight, to make sure that the “then” really does follow the “if,” which it so frequently does not if you just write prose. The challenge is how hard it is to write down explicit artificial economies with these ingredients, actually solve them, in order to see what makes them tick. Frictions are just bloody hard with the mathematical tools we have now.

I rest my case. Paul Krugman is a jerk and offers horrible policy advice. But John Cochrane's response is no friend-of-the-court brief in the Austrian critique of Keynesianism.
Robert P. Murphy holds a Ph.D. in economics from New York University. He is the author of The Politically Incorrect Guide to the Great Depression and the New Deal (Regnery, 2009), and is the editor of the blog Free Advice.

Libertarians that support Truthers are stupid

 

Here’s a little rant I wrote in response to another wild and crazy post titled “Say what you will, Charlie Sheen isn’t giving Obama a pass” on what would otherwise be a fine Austrian Economics blog. Well, and if it wasn’t for the regular stupid religion postings. Bob Murphy was the first big name Austrian Economist I’ve communicated with, and I have to say in all fairness that he has always been very nice to me.

But Bobs wild and wacky lapses into religion and weirdness outside economics make it impossible for me to ever recommend him to others. A real shame, really, because his economic writings are excellent. One of his posts over at Mises.org provided me with the starting point for a chapter in my thesis. So, I do feel bad when I am less than kind in return – but as far as I’m concerned, it’s tough love – because Bob seems to be a genuinely decent fellow.

In any case, I responded to one of the comments on this post of his, according to which

“The point would be that a lot of innocent people died on that day and the truth of what happened has not been presented.

The freedom movement has only benefited from the 9/11 movement. I have friends that will listen to me and read Austrian economics books only because they believe that our Government is willing to take their lives to push an agenda, and they want to know how we could eliminate them from our lives. It is a heck of a lot easier to convince a 9/11 truther that we don't need the State then a Bush or O'bama supporter.”

[The wacky spelling is all his, and just to make sure there is no misunderstanding: Bob did NOT write THAT]

Ok, he’s right – there is a huge overlap between Libertarians and Truthers. Many Truthers found their way to Libertarianism because Libertarianism is the only ideology that openly opposes the State. I have observed this weird phenomenon before with my own eyes, and it puzzled me. Almost as much as it puzzles me that so many Atheists are Socialists – but that’s a big enough topic all by itself.

So, here’s what came to me, and I will try to elaborate on this sometime in the future.

The "Truth" of what happened has been presented. A group of people consisting mostly, or even exclusively, of (Saudi) Arabs conspired to crash planes into important American landmarks in something left-wing anarchists would have dubbed 'propaganda of the deed'. They succeeded beyond their wildest dreams, partially because they correctly anticipated the reaction of the American government. In another way, they failed - since the anticipated uprising of the "Arab Street" did not happen.

The American Government, wilfully and stupidly walked right into what COULD have been a major bear trap, only to go right ahead and dig themselves a massive hole, and succeed in achieving what the perpetrators of the 9/11 did not achieve directly.

Osama bin Laden is probably still giggling at this in utter disbelief.

The "Truth" movement, on the other hand, is little more than the outgrowth of a wild combination of hubris and paranoia.Hubris, because these people cannot believe that their powerful State has been outsmarted by a bunch of Arabs. After all, the Arabs are wild, uncivilized people who can barely count to ten and are too stupid to understand the first thing about our Great Nation. Paranoia, because the only way to explain the failue of the powerful state is to reinterprete the failure as a evil plan.

In reality, the Truth Movement is very much like the "Stab-in-the-back" movement in Germany post-WWI. Why, our powerful Empire could not have possibly succumbed to those Franzen and Tommies and Ivans and Amis - it must have been the evil people in our own government, probably the JEWS!!!!!!

Your Truthers are little more than the budding shock-troops of Fascism. Seriously. You think these crypto-Patriots, these flag-wavers, these paranoiacs are on the side of Liberty?

Maybe you people should broaden your reading list to include a little Hannah Arendt in addition to Rothbard, in particular her The Origins of Totalitariansm.

Not having read The Origins is a serious lack in your education, and probably one of the reasons you don't recognize the Truthers for what they are.

Get real, and stop embarassing the rest of us

Norman Borlaug - Scientist, Humanist, Life Giver, Dies at 95

 

Nobody has saved more human lives than Norman Borlaug – Father of the Green Revolution. Billions live today thanks to him. May his legacy live on.

Norman Borlaug, 95, Dies; Led Green Revolution

By JUSTIN GILLIS

Published: September 13, 2009

Norman E. Borlaug, the plant scientist who did more than anyone else in the 20th century to teach the world to feed itself and whose work was credited with saving hundreds of millions of lives, died Saturday night. He was 95 and lived in Dallas.

The cause was complications from cancer, said Kathleen Phillips, a spokeswoman for Texas A&M University, where Dr. Borlaug had served on the faculty since 1984.

Dr. Borlaug’s advances in plant breeding led to spectacular success in increasing food production in Latin America and Asia and brought him international acclaim. In 1970, he was awarded the Nobel Peace Prize.

He was widely described as the father of the broad agricultural movement called the Green Revolution, though decidedly reluctant to accept the title. “A miserable term,” he said, characteristically shrugging off any air of self-importance.

Yet his work had a far-reaching impact on the lives of millions of people in developing countries. His breeding of high-yielding crop varieties helped to avert mass famines that were widely predicted in the 1960s, altering the course of history. Largely because of his work, countries that had been food deficient, like Mexico and India, became self-sufficient in producing cereal grains.

“More than any other single person of this age, he has helped provide bread for a hungry world,” the Nobel committee said in presenting him with the Peace Prize. “We have made this choice in the hope that providing bread will also give the world peace.”

The day the award was announced, Dr. Borlaug, vigorous and slender at 56, was working in a wheat field outside Mexico City when his wife, Margaret, drove up to tell him the news. “Someone’s pulling your leg,” he replied, according to one of his biographers, Leon Hesser. Assured that it was true, he kept on working, saying he would celebrate later.

The Green Revolution eventually came under attack from environmental and social critics who said it had created more difficulties than it had solved. Dr. Borlaug responded that the real problem was not his agricultural techniques, but the runaway population growth that had made them necessary.

“If the world population continues to increase at the same rate, we will destroy the species,” he declared.

Traveling to Norway, the land of his ancestors, to receive the award, he warned the Nobel audience that the struggle against hunger had not been won. “We may be at high tide now, but ebb tide could soon set in if we become complacent and relax our efforts,” he said. Twice more in his lifetime, in the 1970s and again in 2008, those words would prove prescient as food shortages and high prices caused global unrest.

His Nobel Prize was the culmination of a storied life in agriculture that began when he was a boy growing up on a farm in Iowa, wondering why plants grew better in some places than others. His was also an unlikely career path, one that began in earnest near the end of World War II, when Dr. Borlaug walked away from a promising job at DuPont, the chemical company, to take a position in Mexico trying to help farmers improve their crops.

The job was part of an assault on hunger in Mexico that was devised in Manhattan, at the offices of the Rockefeller Foundation, with political support in Washington. But it was not a career choice calculated to lead to fame or honor.

Indeed, on first seeing the situation in Mexico for himself, Dr. Borlaug reacted with near despair. Mexican soils were depleted, the crops were ravaged by disease, yields were low and the farmers could not feed themselves, much less improve their lot by selling surplus.

“These places I’ve seen have clubbed my mind — they are so poor and depressing,” he wrote to his wife after his first extended sojourn in the country. “I don’t know what we can do to help these people, but we’ve got to do something.”

The next few years were ones of toil and privation as Dr. Borlaug and his colleagues, with scant funds or equipment, set to work improving yields in tropical crop varieties.

He spent countless hours hunched over in the blazing Mexican sun as he manipulated tiny wheat blossoms to cross different strains. To speed the work, he set up winter and summer operations in far-flung parts of Mexico, logging thousands of miles over poor roads. He battled illness, forded rivers in flood, dodged mudslides and sometimes slept in tents.

He was by then a trained scientist holding a doctoral degree in plant diseases. But as he sought to coax better performance from the wheats of Mexico, he relied on a farm boy’s instinctive feel for the plants and the soil in which they grew.

“When wheat is ripening properly, when the wind is blowing across the field, you can hear the beards of the wheat rubbing together,” he told another biographer, Lennard Bickel. “They sound like the pine needles in a forest. It is a sweet, whispering music that once you hear, you never forget.”

Norman Ernest Borlaug was born on March 25, 1914, in his grandfather’s farmhouse near the tiny settlement of Saude, in northeastern Iowa. Growing up in a stalwart community of Norwegian immigrants, he trudged across snow-covered fields to a one-room country school, coming home almost every day to the aroma of bread baking in his mother’s oven.

He was a high-spirited boy of boundless curiosity. His sister, Charlotte Culbert, recounted in an interview in 2008 in Cresco, Iowa, that he would whistle aloud as he milked the cows, and pester his parents and grandparents with questions. “He’d wonder why in some areas the grass would be so green, and then over here it wouldn’t be,” Mrs. Culbert recalled.

At the time, most farm boys dropped out of school. But Norman’s grandfather Nels Borlaug, regretting his own scant education, urged his grandson to keep going. Norman worked his way through the University of Minnesota during the Great Depression. More than once in those desperate years he encountered townspeople in Minneapolis on the verge of starvation, which sharpened his interest in the problems of food production.

He first studied forestry, but fell under the influence of a legendary expert in plant diseases, Elvin C. Stakman, who encouraged him to switch to the broader field of plant pathology. After earning a doctorate in the field, he took a job with DuPont in 1942 and worked on chemical compounds useful in the war. But Professor Stakman helped persuade him to join the Rockefeller Foundation’s Mexican hunger project in 1944.

Dr. Borlaug’s initial goal was to create varieties of wheat adapted to Mexico’s climate that could resist the greatest disease of wheat, a fungus called rust. He accomplished that within a few years by crossing Mexican wheats with rust-resistant varieties from elsewhere.

His insistence on breeding in two places, the Sonoran desert in winter and the central highlands in summer, imposed heavy burdens on him and his team, but it cut the time to accomplish his work in half. By luck, the strategy also produced wheat varieties that were insensitive to day length and thus capable of growing in many locales, a trait that would later prove of vital significance.

The Rockefeller team gradually won the agreement of Mexican farmers to adopt the new varieties, and wheat output in that country began a remarkable climb. But these developments turned out to be a mere prelude to Dr. Borlaug’s main achievements.

By the late 1940s, researchers knew they could induce huge yield gains in wheat by feeding the plants chemical fertilizer that supplied them with extra nitrogen, a shortage of which was the biggest constraint on plant growth. But the strategy had a severe limitation: beyond a certain level of fertilizer, the seed heads containing wheat grains would grow so large and heavy, the plant would fall over, ruining the crop.

In 1953, Dr. Borlaug began working with a wheat strain containing an unusual gene. It had the effect of shrinking the wheat plant, creating a stubby, compact variety. Yet crucially, the seed heads did not shrink, meaning a small plant could still produce a large amount of wheat.

Dr. Borlaug and his team transferred the gene into tropical wheats. When high fertilizer levels were applied to these new “semidwarf” plants, the results were nothing short of astonishing.

The plants would produce enormous heads of grain, yet their stiff, short bodies could support the weight without falling over. On the same amount of land, wheat output could be tripled or quadrupled. Later, the idea was applied to rice, the staple crop for nearly half the world’s population, with yields jumping several-fold compared with some traditional varieties.

This strange principle of increasing yields by shrinking plants was the central insight of the Green Revolution, and its impact was enormous.

By the early 1960s, many farmers in Mexico had embraced the full package of innovations from Dr. Borlaug’s breeding program, and wheat output in the country had soared sixfold from the levels of the early 1940s.

Urgent queries began to pour in from other poor countries, for they were caught in a bind. After World War II, the introduction of basic sanitation in many developing countries caused death rates to plunge, but birth rates were slow to follow. As a result, the global population had exploded, putting immense strain on food supplies.

On the Indian subcontinent in particular, a crisis developed. The population was growing so much faster than farm output that it was not clear how the masses could be fed. In the mid-1960s, huge grain imports were required to avert starvation.

At the invitation of the Indian and Pakistani governments, Dr. Borlaug offered his advice. He met resistance at first from senior agricultural experts steeped in tradition, but as the food situation worsened, the objections faded. Soon, India and Pakistan were ordering shiploads of Dr. Borlaug’s wheat seeds from Mexico.

One vital shipment through the Port of Los Angeles was delayed by the Watts riots of 1965 in that city, and Dr. Borlaug spent hours yelling on the phone to get it through.

Indian and Pakistani farmers took up the new varieties, receiving fertilizer and other aid from their governments. Just as in Mexico, harvests soared: the Indian wheat crop of 1968 was so bountiful that the government had to turn schools into temporary granaries.

As with the Mexican effort, the Rockefeller Foundation and other donors set up a project in the Philippines to work on rice. It led to the creation of semidwarf varieties that also caused rice yields to soar. Chinese scientists ultimately followed in the footsteps of Western researchers, using semidwarf varieties to establish food security in China and setting the stage for its rise as an industrial power. And Dr. Borlaug and his colleagues helped spread the new crop varieties to additional countries of Latin America, notably Colombia, Ecuador, Chile and Brazil.

Dr. Borlaug’s later years were partly occupied by arguments over the social and environmental consequences of the Green Revolution. Many critics on the left attacked it, saying it displaced smaller farmers, encouraged overreliance on chemicals and paved the way for greater corporate control of agriculture.

In a characteristic complaint, Vandana Shiva, an Indian critic, wrote in 1991 that “in perceiving nature’s limits as constraints on productivity that had to be removed, American experts spread ecologically destructive and unsustainable practices worldwide.”

Dr. Borlaug declared that such arguments often came from “elitists” who were rich enough not to worry about where their next meal was coming from. But over time, he acknowledged the validity of some environmental concerns, and embraced more judicious use of fertilizers and pesticides. He was frustrated throughout his life that governments did not do more to tackle what he called “the population monster” by lowering birth rates.

He remained a vigorous man into his 90s, serving for many years on the faculty of Texas A&M and continuing to do vital agricultural work. In recent years, he marshaled efforts to tackle a new variety of rust that is threatening the world’s wheat crop.

Dr. Borlaug’s wife of 69 years, the former Margaret Gibson, died in 2007. He is survived by a sister, Charlotte Borlaug Culbert; a daughter, Jeanie Borlaug Laube; a son, William Borlaug; five grandchildren; and six great-grandchildren.

Gary H. Toenniessen, director of agricultural programs for the Rockefeller Foundation, said in an interview that Dr. Borlaug’s great achievement was to prove that intensive, modern agriculture could be made to work in the fast-growing developing countries where it was needed most, even on the small farms predominating there.

By Mr. Toenniessen’s calculation, about half the world’s population goes to bed every night after consuming grain descended from one of the high-yield varieties developed by Dr. Borlaug and his colleagues of the Green Revolution.

“He knew what it was they needed to do, and he didn’t give up,” Mr. Toenniessen said. “He could just see that this was the answer.”

Gerald Jonas and Sarah Wheaton contributed reporting.

How did Paul Krugman get it so Wrong?

 

John H. Cochrane[1]

Many friends and colleagues have asked me what I think of Paul Krugman’s New York Times Magazine article, “How did Economists get it so wrong?”

Most of all, it’s sad. Imagine this weren’t economics for a moment. Imagine this were a respected scientist turned popular writer, who says, most basically, that everything everyone has done in his field since the mid 1960s is a complete waste of time. Everything that fills its academic journals, is taught in its PhD programs, presented at its conferences, summarized in its graduate textbooks, and rewarded with the accolades a profession can bestow, including multiple Nobel prizes, is totally wrong. Instead, he calls for a return to the eternal verities of a rather convoluted book written in the 1930s, as taught to our author in his undergraduate introductory courses. If a scientist, he might be a global-warming skeptic, an AIDS-HIV disbeliever, a creationist, a stalwart that maybe continents don’t move after all.

It gets worse. Krugman hints at dark conspiracies, claiming “dissenters are marginalized.” Most of the article is just a calumnious personal attack on an ever-growing enemies list, which now includes “new Keyenesians” such as Olivier Blanchard and Greg Mankiw. Rather than source professional writing, he plays gotcha with out-of-context second-hand quotes from media interviews. He makes stuff up, boldly putting words in people’s mouths that run contrary to their written opinions. Even this isn’t enough: he adds cartoons to try to make his “enemies” look silly, and puts them in false and embarrassing situations. He accuses us of adopting ideas for pay, selling out for “sabbaticals at the Hoover institution” and fat “Wall street paychecks.” It sounds a bit paranoid.

It’s annoying to the victims, but we’re big boys and girls. It’s a disservice to New York Times readers. They depend on Krugman to read real academic literature and digest it, and they get this attack instead. And it’s ineffective. Any astute reader knows that personal attacks and innuendo mean the author has run out of ideas.

That’s the biggest and saddest news of this piece: Paul Krugman has no interesting ideas whatsoever about what caused our current financial and economic problems, what policies might have prevented it, or what might help us in the future, and he has no contact with people who do. “Irrationality” and advice to spend like a drunken sailor are pretty superficial compared to all the fascinating things economists are writing about it these days.

How sad.

That’s what I think, but I don’t expect you the reader to be convinced by my opinion or my reference to professional consensus. Maybe he is right. Occasionally sciences, especially social sciences, do take a wrong turn for a decade or two. I thought Keynesian economics was such a wrong turn. So let’s take a quick look at the ideas.

Krugman’s attack has two goals. First, he thinks financial markets are “inefficient,” fundamentally due to “irrational” investors, and thus prey to excessive volatility which needs government control. Second, he likes the huge “fiscal stimulus” provided by multi-trillion dollar deficits.

Efficiency.

It’s fun to say we didn’t see the crisis coming, but the central empirical prediction of the efficient markets hypothesis is precisely that nobody can tell where markets are going – neither benevolent government bureaucrats, nor crafty hedge-fund managers, nor ivory-tower academics. This is probably the best-tested proposition in all the social sciences. Krugman knows this, so all he can do is huff and puff about his dislike for a theory whose central prediction is that nobody can be a reliable soothsayer.

Krugman writes as if the volatility of stock prices alone disproves market efficiency, and efficient marketers just ignored it all these years. This is a canard that Paul knows better than to pass on, no matter how rhetorically convenient. (I can overlook his mixing up the CAPM and Black-Scholes model, but not this.) There is nothing about “efficiency” that promises “stability.” “Stable” growth would in fact be a major violation of efficiency. Efficient markets did not need to wait for “the memory of 1929 … gradually receding,” nor did we fail to read the newspapers in 1987. Data from the great depression has been included in practically all the tests. In fact, the great “equity premium puzzle” is that if efficient, stock markets don’t seem risky enough to deter more people from investing! Gene Fama’s PhD thesis was on “fat tails” in stock returns.

It is true and very well documented that asset prices move more than reasonable expectations of future cashflows. This might be because people are prey to bursts of irrational optimism and pessimism. It might also be because people’s willingness to take on risk varies over time, and is lower in bad economic times. As Gene Fama pointed out in 1970, these are observationally equivalent explanations. Unless you are willing to elaborate your theory to the point that it can quantitatively describe how much and when risk premiums, or waves of “optimism” and “pessimism,” can vary, you know nothing. No theory is particularly good at that right now. Crying “bubble” is empty unless you have an operational procedure for identifying bubbles, distinguishing them from rationally low risk premiums, and not crying wolf too many years in a row.

But this difficulty is no surprise. It’s the central prediction of free-market economics, as crystallized by Hayek, that no academic, bureaucrat or regulator will ever be able to fully explain market price movements. Nobody knows what “fundamental” value is. If anyone could tell what the price of tomatoes should be, let alone the price of Microsoft stock, communism would have worked.

More deeply, the economist’s job is not to “explain” market fluctuations after the fact, to give a pleasant story on the evening news about why markets went up or down. Markets up? “A wave of positive sentiment.” Markets went down? “Irrational pessimism.” ( “The risk premium must have increased” is just as empty.) Our ancestors could do that. Really, is that an improvement on “Zeus had a fight with Apollo?” Good serious behavioral economists know this, and they are circumspect in their explanatory claims so far.

But this argument takes us away from the main point. The case for free markets never was that markets are perfect. The case for free markets is that government control of markets, especially asset markets, has always been much worse.

Krugman at bottom is arguing that the government should massively intervene in financial markets, and take charge of the allocation of capital. He can’t quite come out and say this, but he does say “Keynes considered it a very bad idea to let such markets…dictate important business decisions,” and “finance economists believed that we should put the capital development of the nation in the hands of what Keynes had called a `casino.’” Well, if markets can’t be trusted to allocate capital, we don’t have to connect too many dots to imagine who Paul has in mind.

To reach this conclusion, you need evidence, experience, or any realistic hope that the alternative will be better. Remember, the SEC couldn’t even find Bernie Madoff when he was handed to them on a silver platter. Think of the great job Fannie, Freddie, and Congress did in the mortgage market. Is this system going to regulate Citigroup, guide financial markets to the right price, replace the stock market, and tell our society which new products are worth investment? As David Wessel’s excellent In Fed We Trust makes perfectly clear, government regulators failed just as abysmally as private investors and economists to see the storm coming. And not from any lack of smarts.

In fact, the behavioral view gives us a new and stronger argument against regulation and control. Regulators are just as human and irrational as market participants. If bankers are, in Krugman’s words, “idiots,” then so must be the typical treasury secretary, fed chairman, and regulatory staff. They act alone or in committees, where behavioral biases are much better documented than in market settings. They are still easily captured by industries, and face politically distorted incentives.

Careful behavioralists know this, and do not quickly run from “the market got it wrong” to “the government can put it all right.” Even my most behavioral colleagues Richard Thaler and Cass Sunstein in their book “Nudge” go only so far as a light libertarian paternalism, suggesting good default options on our 401(k) accounts. (And even here they’re not very clear on how the Federal Nudging Agency is going to steer clear of industry capture.) They don’t even think of jumping from irrational markets, which they believe in deeply, to Federal control of stock and house prices and allocation of capital.

Stimulus

Most of all, Krugman likes fiscal stimulus. In this quest, he accuses us and the rest of the economics profession of “mistaking beauty for truth.” He’s not clear on what the “beauty” is that we all fell in love with, and why one should shun it, for good reason. The first siren of beauty is simple logical consistency. Paul’s Keynesian economics requires that people make logically inconsistent plans to consume more, invest more, and pay more taxes with the same income. The second siren is plausible assumptions about how people behave. Keynesian economics requires that the government is able to systematically fool people again and again. It presumes that people don’t think about the future in making decisions today. Logical consistency and plausible foundations are indeed “beautiful” but to me they are also basic preconditions for “truth.”

In economics, stimulus spending ran aground on Robert Barro’s Ricardian equivalence theorem. This theorem says that debt-financed spending can’t have any effect because people, seeing the higher future taxes that must pay off the debt, will simply save more. They will buy the new government debt and leave all spending decisions unaltered. Is this theorem true? It’s a logical connection from a set of “if” to a set of “therefore.” Not even Paul can object to the connection.

Therefore, we have to examine the “ifs.” And those ifs are, as usual, obviously not true. For example, the theorem presumes lump-sum taxes, not proportional income taxes. Alas, when you take this into account we are all made poorer by deficit spending, so the multiplier is most likely negative. The theorem (like most Keynesian economics) ignores the composition of output; but surely spending money on roads rather than cars can affect the overall level.

Economists have spent a generation tossing and turning the Ricardian equivalence theorem, and assessing the likely effects of fiscal stimulus in its light, generalizing the “ifs” and figuring out the likely “therefores.” This is exactly the right way to do things. The impact of Ricardian equivalence is not that this simple abstract benchmark is literally true. The impact is that in its wake, if you want to understand the effects of government spending, you have to specify why it is false. Doing so does not lead you anywhere near old-fashioned Keynesian economics. It leads you to consider distorting taxes, how much people care about their children, how many people would like to borrow more to finance today’s consumption and so on. And when you find “market failures” that might justify a multiplier, optimal-policy analysis suggests fixing the market failures, not their exploitation by fiscal multiplier. Most “New Keynesian” analyses that add frictions don’t produce big multipliers.

This is how real thinking about stimulus actually proceeds. Nobody ever “asserted that an increase in government spending cannot, under any circumstances, increase employment.” This is unsupportable by any serious review of professional writings, and Krugman knows it. (My own are perfectly clear on lots of possibilities for an answer that is not zero.) But thinking through this sort of thing and explaining it is much harder than just tarring your enemies with out-of-context quotes, ethical innuendo, or silly cartoons.

In fact, I propose that Krugman himself doesn’t really believe the Keynesian logic for that stimulus. I doubt he would follow that logic to its inevitable conclusions. Stimulus must have some other attraction to him.

If you believe the Keynesian argument for stimulus, you should think Bernie Madoff is a hero. He took money from people who were saving it, and gave it to people who most assuredly were going to spend it. Each dollar so transferred, in Krugman’s world, generates an additional dollar and a half of national income. The analogy is even closer. Madoff didn’t just take money from his savers, he essentially borrowed it from them, giving them phony accounts with promises of great profits to come. This looks a lot like government debt.

If you believe the Keynesian argument for stimulus, you don’t care how the money is spent. All this puffery about “infrastructure,” monitoring, wise investment, jobs “created” and so on is pointless. Keynes thought the government should pay people to dig ditches and fill them up.

If you believe in Keynesian stimulus, you don’t even care if the government spending money is stolen. Actually, that would be better. Thieves have notoriously high propensities to consume.

The crash.

Krugman’s article is supposedly about how the crash and recession changed our thinking, and what economics has to say about it. The most amazing news in the whole article is that Paul Krugman has absolutely no idea about what caused the crash, what policies might have prevented it, and what policies we should adopt going forward. He seems completely unaware of the large body of work by economists who actually do know something about the banking and financial system, and have been thinking about it productively for a generation.

Here’s all he has to say: “Irrationality” caused markets to go up and then down. “Spending” then declined, for unclear reasons, possibly “irrational” as well. The sum total of his policy recommendations is for the Federal Government to spend like a drunken sailor after the fact.

Paul, there was a financial crisis, a classic near-run on banks. The centerpiece of our crash was not the relatively free stock or real estate markets, it was the highly regulated commercial banks. A generation of economists has thought really hard about these kinds of events. Look up Diamond, Rajan, Gorton, Kashyap, Stein, and so on. They’ve thought about why there is so much short term debt, why banks run, how deposit insurance and credit guarantees help, and how they give incentives for excessive risk taking.

If we want to think about events and policies, this seems like more than a minor detail. The hard and central policy debate over the last year was how to manage this financial crisis. Now it is how to set up the incentives of banks and other financial institutions so this mess doesn’t happen again. There’s lots of good and subtle economics here that New York Times readers might like to know about. What does Krugman have to say? Zero.

Krugman doesn’t even have anything to say about the Fed. Ben Bernanke did a lot more last year than set the funds rate to zero and then go off on vacation and wait for fiscal policy to do its magic. Leaving aside the string of bailouts, the Fed started term lending to securities dealers. Then, rather than buy treasuries in exchange for reserves, it essentially sold treasuries in exchange for private debt. Though the funds rate was near zero, the Fed noticed huge commercial paper and securitized debt spreads, and intervened in those markets. There is no “the” interest rate anymore, the Fed is attempting to manage them all. Recently the Fed has started buying massive quantities of mortgage-backed securities and long-term treasury debt.

Monetary policy now has little to do with “money” vs. “bonds” with all the latter lumped together. Monetary policy has become wide-ranging financial policy. Does any of this work? What are the dangers? Can the Fed stay independent in this new role? These are the questions of our time. What does Krugman have to say? Nothing.

Krugman is trying to say that a cabal of obvious crackpots bedazzled all of macroeconomics with the beauty of their mathematics, to the point of inducing policy paralysis. Alas, that won’t stick. The sad fact is that few in Washington pay the slightest attention to modern macroeconomic research, in particular anything with a serious intertemporal dimension. Paul’s simple Keynesianism has dominated policy analysis for decades and continues to do so. From the CEA to the Fed to the OMB and CBO, everyone just adds up consumer, investment and government “demand” to forecast output and uses simple Phillips curves to think about inflation. If a failure of ideas caused bad policy, it’s a simpleminded Keynesianism that failed.

The future of economics.

How should economics change? Krugman argues for three incompatible changes.

First, he argues for a future of economics that “recognizes flaws and frictions,” and incorporates alternative assumptions about behavior, especially towards risk-taking. To which I say, “Hello, Paul, where have you been for the last 30 years?” Macroeconomists have not spent 30 years admiring the eternal verities of Kydland and Prescott’s 1982 paper. Pretty much all we have been doing for 30 years is introducing flaws, frictions and new behaviors, especially new models of attitudes to risk, and comparing the resulting models, quantitatively, to data. The long literature on financial crises and banking which Krugman does not mention has also been doing exactly the same.

Second, Krugman argues that “a more or less Keynesian view is the only plausible game in town,” and “Keynesian economics remains the best framework we have for making sense of recessions and depressions.” One thing is pretty clear by now, that when economics incorporates flaws and frictions, the result will not be to rehabilitate an 80-year-old book. As Paul bemoans, the “new Keynesians” who did just what he asks, putting Keynes inspired price-stickiness into logically coherent models, ended up with something that looked a lot more like monetarism. (Actually, though this is the consensus, my own work finds that new-Keynesian economics ended up with something much different and more radical than monetarism.) A science that moves forward almost never ends up back where it started. Einstein revises Newton, but does not send you back to Aristotle. At best you can play the fun game of hunting for inspirational quotes, but that doesn’t mean that you could have known the same thing by just reading Keynes once more.

Third, and most surprising, is Krugman’s Luddite attack on mathematics; “economists as a group, mistook beauty, clad in impressive-looking mathematics, for truth.” Models are “gussied up with fancy equations.” I’m old enough to remember when Krugman was young, working out the interactions of game theory and increasing returns in international trade for which he won the Nobel Prize, and the old guard tut-tutted “nice recreational mathematics, but not real-world at all.” How quickly time passes.

Again, what is the alternative? Does Krugman really think we can make progress on his – and my – agenda for economic and financial research -- understanding frictions, imperfect markets, complex human behavior, institutional rigidities – by reverting to a literary style of exposition, and abandoning the attempt to compare theories quantitatively against data? Against the worldwide tide of quantification in all fields of human endeavor (read “Moneyball”) is there any real hope that this will work in economics?

No, the problem is that we don’t have enough math. Math in economics serves to keep the logic straight, to make sure that the “then” really does follow the “if,” which it so frequently does not if you just write prose. The challenge is how hard it is to write down explicit artificial economies with these ingredients, actually solve them, in order to see what makes them tick. Frictions are just bloody hard with the mathematical tools we have now.

The insults.

The level of personal attack in this article, and fudging of the facts to achieve it, is simply amazing.

As one little example (ok, I’m a bit sensitive), take my quotation about carpenters in Nevada. I didn’t write this. It’s a quote, taken out of context, from a bloomberg.com article written by a reporter who I spent about 10 hours with patiently trying to explain some basics. (It’s the last time I’ll do that!) I was trying to explain how sectoral shifts contribute to unemployment. Krugman follows it by a lie -- I never asserted that “it take mass unemployment across the whole nation to get carpenters to move out of Nevada.” You can’t even dredge up a quote for that monstrosity.

What’s the point? I don’t think Paul disagrees that sectoral shifts result in some unemployment, so the quote actually makes sense as economics. The only point is to make me, personally, seem heartless -- a pure, personal, calumnious attack, having nothing to do with economics.

Bob Lucas has written extensively on Keynesian and monetarist economics, sensibly and even-handedly. Krugman chooses to quote a joke, made back in 1980 at a lunch talk to some business school alumni. Really, this is on the level of the picture of Barack Obama with Bill Ayres that Sean Hannity likes to show on Fox News.

It goes on. Krugman asserts that I and others “believe” “that an increase in government spending cannot, under any circumstances, increase employment,” or that we “argued that price fluctuations and shocks to demand actually had nothing to do with the business cycle.” These are just gross distortions, unsupported by any documentation, let alone professional writing. And Krugman knows better. All economic models are simplified to exhibit one point; we all understand the real world is more complicated; and his job is supposed to be to explain that to lay readers. It would be no different than if someone were to look up Paul’s early work which assumed away transport costs and claim “Paul Krugman believes ocean shipping is free, how stupid” in the Wall Street Journal.

The idea that any of us do what we do because we’re paid off by fancy Wall Street salaries or cushy sabbaticals at Hoover is just ridiculous. (If Krugman knew anything about hedge funds he’d know that believing in efficient markets disqualifies you for employment. Nobody wants a guy who thinks you can’t make any money trading!) Given Krugman’s speaking fees, it’s a surprising first stone for him to cast.

Apparently, salacious prose, innuendo, calumny, and selective quotation from media aren’t enough: Krugman added cartoons to try to make opponents look silly. The Lucas-Blanchard-Bernanke conspiratorial cocktail party celebrating the end of recessions is a silly fiction. So is their despondent gloom on reading “recession” in the paper. Nobody at a conference looks like Dr. Pangloss with wild hair and a suit from the 1800s. (OK, Randy Wright has the hair, but not the suit.) Keynes did not reappear at the NBER to be booed as an “outsider.” Why are you allowed to make things up in pictures that wouldn’t pass even the Times’ weak fact-checking in words?

Well, perhaps we got off easy. This all was mild compared to Krugman’s vicious obituary of Milton Friedman in the New York Review of Books. But most of all, Paul isn’t doing his job. He’s supposed to read, explain, and criticize things economists write, and preferably real professional writing, not interviews, opeds and blog posts. At a minimum, this leads to the unavoidable conclusion that Krugman isn’t reading real economics anymore.

How did Krugman get it so wrong?

So what is Krugman up to? Why become a denier, a skeptic, an apologist for 70 year old ideas, replete with well-known logical fallacies, a pariah? Why publish an essentially personal attack on an ever-growing enemies list that now includes practically every professional economist? Why publish an incoherent vision for the future of economics?

The only explanation that makes sense to me is that Krugman isn’t trying to be an economist, he is trying to be a partisan, political opinion writer. This is not an insult. I read George Will, Charles Krauthnammer and Frank Rich with equal pleasure even when I disagree with them. Krugman wants to be Rush Limbaugh of the Left. I still want to be Milton Friedman, but each is a worthy calling.

Alas, to Krugman, as to far too many ex-economists in partisan debates, economics is not a quest for understanding. It is a set of debating points to argue for policies that one has adopted for partisan political purposes. “Stimulus” is just marketing to sell Congressmen and voters on a package of government spending priorities that you want for political reasons. It’s not a proposition to be explained, understood, taken seriously to its logical limits, or reflective of market failures that should be addressed directly.

Why argue for a nonsensical future for economics? Well, again, if you don’t regard economics as a science, a discipline that ought to result in quantitative matches to data, a discipline that requires crystal-clear logical connections between the “if” and the “then,” if the point of economics is merely to provide marketing and propaganda for politically-motivated policy, then his writing does make sense. It makes sense to appeal to some future economics – not yet worked out, even verbally – to disdain quantification and comparison to data, and to appeal to the authority of ancient books as interpreted you, their lone remaining apostle.

Most of all, this is the only reason I can come up with to understand why Krugman wants to write personal attacks on those who disagree with him. I like it when people disagree with me, and take time to read my work and criticize it. At worst I learn how to position it better. At best, I discover I was wrong and learn something. I send a polite thank you note.

Krugman wants people to swallow his arguments whole from his authority, without demanding logic, or evidence. Those who disagree with him, alas, are pretty smart and have pretty good arguments if you bother to read them. So, he tries to discredit them with personal attacks.

This is the political sphere, not the intellectual one. Don’t argue with them, swift-boat them. Find some embarrassing quote from an old interview. Well, good luck, Paul. Let’s just not pretend this has anything to do with economics, or actual truth about how the world works or could be made a better place.

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[1] University of Chicago Booth School of Business. Many colleagues and friends helped, but I don’t want to name them for obvious reasons. Krugman fans: Please don’t bother emailing me to tell me what a jerk I am. I will update this occasionally, so please pass on the link http://faculty.chicagobooth.edu/john.cochrane/research/Papers/#news not the document.

Comments on American Democracy #1

Thanks to the Health Care debate, it should now be clear that to properly understand American democracy one should read Mencken, not Tocqueville. And should the absurd theatre that currently passes for public debate in America continue to degrade further – if that is indeed possible – it may even be time to dust off that long-forgotten tome by Spengler. Caligula’s horse would be too embarrassed to sit among the screaming lemurs that make up the US Congress. But what can one expect – after all, each nation gets the government it deserves, including the United States of America.

There is no public debate in America. A debate requires at least two parties who occasionally manage to say something meaningful to each other. Only a comedian could take that as a description of this ‘public debate’. What we have instead is dimwits untainted by the slightest hue of understanding spouting the most obvious stupidities on issues far beyond their ken to masses of ignorant blockheads.

There is the foul-mouthed underclass of barely educated right-wingers trying to protect a boondoggle government program from the government. There are the mealy-mouthed semi-educated left wingers wanting to replace a cobweb of private monopolies protected by the government with a single monopoly run directly government. None of these jackasses and squirrel brains manages to say anything that could withstand the analytical acuity of a clever twelve-year old – provided the poor child has successfully avoided the blessings of American public education.

But, what am I talking about? American’s voted for this. Every two years, they go and vote those lemurs, blowhards, jackasses, and dimwits into public office. Every two years, they do the same thing. Clearly, if they didn’t like the outcome, would they continue?

Vacation

 

Dear readers,

I will be on vacation until August 25th. Thank you for stopping by, and please come back soon.

Economics Joke - #1

 

If C+I+G+X-M=Y

 

then $10C+$10I+$10G+$10X-$10M = $10C+$0I+$20G+0X-$0M

 

If this isn’t funny, I don’t know what is.

More Health Insurance is Not the Answer

When someone else pays, costs always go up

John Stossel | July 9, 2009

Health care "reformers" keep talking about getting us more health insurance. Then they talk about cutting costs. This is contradictory nonsense.

Insurance, whether private or a government Ponzi scheme like Medicare, means third parties pay the bills. When someone else pays, costs always go up. 

Imagine if you had grocery insurance. You wouldn't care how much food cost. Why shop around? If someone else were paying 80 percent, you'd buy the most expensive cuts of meat. Prices would skyrocket.

That's what health insurance does to medical care. Patients rarely even ask what anything costs. Doctors often don't know. Often nobody even gives a damn. Patients rarely ask, "Is that MRI really necessary? Is there a cheaper place?" We consume without thinking. 

By contrast, in areas of medicine where most patients pay their own way, service gets better, while prices fall.

Take plastic surgery and Lasik eye surgery: Because patients shop around and compare prices, doctors work hard to win their business. They often give customers their cell-phone numbers. Service keeps increasing, but prices don't. "In every other field of medicine, the price is going up faster than consumer prices in general," says John Goodman of the National Center for Policy Analysis. "But the price of Lasik surgery, on average, has gone down by 30 percent."

This shouldn't be a surprise. What holds costs down is patients acting like consumers, looking out for themselves in a competitive market. Providers fight to win business by keeping costs down and quality up.

Yet politicians keep telling us the solution is more insurance. And they mean insurance not just for catastrophic diseases that could bankrupt us but also for routine treatments. 

The politicians are so oblivious to reality that they are on course to make things worse. Obama would force every business to either give workers health insurance or pay a fine into the public system. Why is that something we should want employers to do? Premiums come out of our salaries, but insurers are accountable to our bosses, not to us. 

Why not just have a free market where people can buy whatever kind of health insurance they want? Competition would then bring prices down.

Obama and his Senate allies would limit competition by requiring insurers to cover everyone for the same "fair" price. No "cherry picking," the president says. No charging healthy people less. 

They call this "community rating," and it sounds fair. No more cruel "discrimination" against people who have a preexisting condition, obese people or smokers. But such simple-minded one-size-fits-all rules take from insurance companies their best price-dampening tool: Risk-based pricing encourages people to take better care of themselves, just as car-insurance companies reward good drivers. With one-size pricing your car-insurance company must give the town drunk the same deal it gives you. 

Insane, but the health-insurance industry is playing along. Insurers say that if government forces everyone to have insurance, they will accept all customers regardless of preexisting illnesses. 

They also offered to stop charging higher premiums to sick people. They're even giving up ongender differences.

Sen. John Kerry huffed, "The disparity between women and men in the individual insurance market is just plain wrong, and it has to change." The president of the industry trade group, Karen M. Ignagni, agreed that disparities "should be eliminated." 

Give me a break. 

Women pay more than men for health insurance for good reason. Despite being healthier than men, they incur higher costs because they go to doctors more often, and they take more medicine. Kerry is pandering. I don't recall him demanding that men be protected from higher life-insurance and auto-insurance premiums.

"Community rating" hides the cost of health care. It's as destructive as ordering fire insurance companies to charge identical premiums for wood frame and stone houses. Universal health insurance with "no discrimination" pricing will make health care costs rise even faster. 

When politicians interfere with free markets, unintended consequences harm everyone, except the companies that lobby hard enough to protect themselves. 

Is it too much to expect our rulers to understand this?

John Stossel is co-anchor of ABC News' 20/20 and the author of Myth, Lies, and Downright Stupidity.

Zoho vs. MS Office

 

I just discovered by sheer accident this nifty on-line service which, at first glance, makes most of the Google applications look outright lame. I haven’t heard of Zoho until then, but I think I’m already becoming a believer. I’m not quite ready to ditch my MS Office – yet – but so far, the impression is good. For example, the Zoho Writer appears capable of reading the new Microsoft docx format. As I write this (not on Zoho, yet), it is uploading my Master’s thesis – very heavy on docx formatted features, graphs, etc. I’ll report back once it’s done and let you know how it went.

Until then, read this NYT review of Zoho – it’s a good reflection of my own experience so far.

Small Company Offers Web-Based Competition for Microsoft Word

By RANDALL STROSS

WITHIN Microsoft’s Office group, the calendar on the wall appears to be 1983, the year the company introduced Microsoft Word. The company still expects customers to buy its software applications as products and install and run them on PCs.

Recognition of the Internet has been slow in coming. Microsoft is finally preparing Web versions of its Office suite, though these are intended as supplements, not as replacements. The company maintains that Web versions of a Word or Excel will never match the functionality and responsiveness that software installed on one’s own machine provides.

It may be wrong.

Granted, Microsoft’s largest competitor, Google, has not yet marched up to the bulwarks guarding Microsoft Office and blown a gaping hole into its adversary’s complacency. Google Apps, its Office-like suite, contains an uneven bunch of services. I find Google Calendar far superior to Microsoft Outlook’s calendar, but Google’s word processor, Docs, lacks many features in Word that I rely on.

The best online word processor, however, may be the one from a tiny company, Zoho, a nimble innovator. Zoho Writer is running close enough to Word to imagine that it and other online word processors will be able to do most everything that Word can do, and more.

Zoho Writer handles the basics and provides many advanced functions without breaking a sweat — like the ability to edit a document when page breaks are displayed. Google Docs can’t. Writer works even when one is offline, thanks to open source technology developed by Google, and used by Zoho in its word processor four months before Google used it.

Zoho Writer also provides some esoteric features, like a choice of footnotes or endnotes, with note numbers in superscript, placed in the text. Google Docs does only footnotes and puts in a pound sign as a placeholder. You may never need to create the most complex mathematical equations, but Zoho Writer makes it easy to do so.

Writer is offered free to individual users and to the first 10 users in a business. (So are 9 of Zoho’s 18 other online services at Zoho.com.) And free means free of advertising, too. “We don’t do advertising at all. We don’t believe in advertising,” says Raju Vegesna, a Zoho marketing executive.

Zoho hopes that word will spread and that larger businesses will sign up, willing to pay $50 a year a user for access to the 10 productivity applications, like Writer, and separate monthly fees for business applications.

Microsoft Office comes in various configurations and prices, and Microsoft doesn’t disclose its lowest price for volume purchases. But Office Professional 2007 is available from retailers for about $400.

Zoho is a division of AdventNet, which provides online software services to corporate I.T. departments and is based in Pleasanton, Calif. AdventNet, privately held, says its I.T. software is profitable but doesn’t claim the same for Zoho, which AdventNet created in 2005.

At Microsoft, Chris Capossela, senior vice president in Microsoft’s Business Division who manages its Office product line, explained to me how the company was preparing for “the future of computing — a combination of the best of software and the best of Internet services.” The next version of Office — being prepared for release in 2010 or after, he said — will have three incarnations, beginning with what Microsoft calls the “rich client” (“rich” refers to features) and installed on the user’s PC, and the mobile version for smartphones. Both of those exist today. The third, and new, form will be the Web-based service.

Mr. Capossela sees the Web version of Office as only a stopgap for users who are away from home or office and, in a pinch, must use a machine that isn’t their own. With Office on the Web, “users can do a little bit of work, between classes, or at the airport,” he said.

Asked whether Microsoft was interested in making the Web version as fully featured as the desktop version, he scoffed at the notion that a “browser experience” could be equivalent to a “rich client,” at least without the graphical help of an add-in like Adobe’s Flash.

Adobe’s Web site offers its own free Flash-equipped online word processor, Buzzword. But to my taste, Flash is visual overkill for word processing. Zoho Writer manages perfectly well without Flash.

Mr. Capossela sounded confident when he described the lead that Microsoft enjoys over online challengers like Zoho. “A lot of our competitors have to spend a huge amount of energy copying features that we already have in the Office suite,” he said. “We don’t have that burden to bear.”

Zoho, however, doesn’t seem burdened at all. It has moved well ahead of Word in some areas, such as offering multiple users the ability to edit the same document simultaneously.

Zoho Writer is not completely polished — I lose double-spacing when exporting to Word, and there’s an irksome extra step required to print a clean copy of a final draft, without the browser’s header. In all, though, these are small irritations, balanced by gaining the ability to edit and share documents online effortlessly, in many different ways.

Microsoft estimates that 500 million copies of Office are running on the world’s one billion Windows machines. Those were the easy wins, before the Web was ready to compete against installed software. The next 500 million copies, if won, will require staying ahead of what rivals can accomplish within the unassuming frame of the Web browser.

Randall Stross is an author based in Silicon Valley and a professor of business at San Jose State University. E-mail: stross@nytimes.com.

America’s New Money

or – how do say “Weimar” in American?

 

Google to launch operating system

[please note my quibble foot-notes below]

By Maggie Shiels
Technology reporter, BBC News, Silicon Valley

Google is developing an operating system (OS) for personal computers, in a direct challenge to market leader Microsoft and its Windows system.

Google Chrome OS will be aimed initially at small, low-cost netbooks, but will eventually be used on PCs as well.

Google said netbooks with Chrome OS could be on sale by the middle of 2010.

"Speed, simplicity and security are the key aspects of Google Chrome OS," the firm said in its official blog.

The operating system, which will run on an open source licence, was a "natural extension" of its Chrome browser, the firm said.

The news comes just months before Microsoft launches the latest version of its operating system, called Windows 7.

'Back to basics'

"We're designing the OS to be fast and lightweight, to start up and get you on to the web in a few seconds," said the blog post written by Sundar Pichai, vice-president of product management, and Google's engineering director Linus Upson.

Both men said that "the operating systems that browsers run on were designed in an era where there was no web" and that this OS was "our attempt to rethink what operating systems should be".

To that end, the search giant said the new OS would go back to basics.

"We are completely redesigning the underlying security architecture of the OS so that users don't have to deal with viruses, malware and security updates.

"It should just work," said Google.

Google already has an operating system for mobile phones called Android which can also be used to run on netbooks. Google Chrome OS will be aimed not just at laptops but also at desktops for those who spend a lot of time on the web.

'Truly competitive'

The announcement could dramatically change the market for operating systems, especially for Microsoft, the biggest player with around 90% share.

"This announcement is huge," said Rob Enderle, industry watcher and president of the Enderle Group.

"This is the first time we have had a truly competitive OS on the market in years. This is potentially disruptive and is the first real attempt by anyone to go after Microsoft.

"Google is coming at this fresh and, because it is based on a set of services that reside on the web, it is the first really post-web* operating system, designed from the ground up, and reconceived for a web world," Mr Enderle told the BBC.

Last year Google launched the Chrome browser, which it said was designed for "people who live on the web - searching for information, checking e-mail, catching up on the news, shopping or just staying in touch with friends".

Stephen Shankland at CNET said the move had widespread implications.

"One is that it shows just how serious Google is about making the web into a foundation not just for static pages but for active applications, notably its own such as Google Docs and G-mail.

"Another, it opens new competition with Microsoft and, potentially, a new reason for anti-trust regulators to pay close attention to Google's moves."**

Some commentators said Google's motivation in all this was pretty clear.

"One of Google's major goals is to take Microsoft out, to systematically destroy their hold on the market," said Mr Enderle.

"Google wants to eliminate Microsoft and it's a unique battle. The strategy is good. The big question is, will it work?"

At the popular blog, TechCrunch, MG Siegler said: "Let's be clear on what this really is. This is Google dropping the mother of all bombs on its rival, Microsoft."

Microsoft releases Windows 7 later this year to replace Windows Vista and Windows XP, which is eight years old.

The Redmond-based company claims that 96% of netbooks run Windows to date.

Out of beta

In a separate announcement Google also revealed that many of its most popular applications had finally moved out of trial, or beta, phase.

Gmail, for example, has worn the beta tag for five years.

"We realise this situation puzzles some people, particularly those who subscribe to the traditional definition of beta software as being not yet ready for prime time," wrote Matthew Glotzbach, the director of product management in the official Google blog.

The decision to ditch the beta tag was taken because the apps had finally reached the "high bar" mark, he wrote.

More than 1.75 million companies use Google apps, according to the firm.

===

*post-web? So there is no more ‘web’?

**Yes, they SHOULD. Because it proves once and for all that there is NO SUCH THING as a ‘monopoly’ in the free market.

Capitalist socialism in the works of Fellini

 

J. John Hubbard
Department of Politics, Miskatonic University, Arkham, Mass.

1. The pretextual paradigm of consensus and dialectic construction

“Society is part of the defining characteristic of consciousness,” says Lacan; however, according to Finnis[1] , it is not so much society that is part of the defining characteristic of consciousness, but rather the fatal flaw, and thus the futility, of society. But the subject is contextualised into a that includes culture as a whole. The premise of capitalist socialism states that art serves to reinforce sexism, given that neoconstructivist objectivism is invalid.

However, if dialectic construction holds, we have to choose between the textual paradigm of context and postsemioticist situationism. Sartre’s model of capitalist socialism implies that consensus is created by the collective unconscious.

But la Fournier[2] states that we have to choose between neostructuralist dematerialism and material rationalism. Derrida promotes the use of dialectic construction to modify class.

2. Joyce and the textual paradigm of context

If one examines capitalist socialism, one is faced with a choice: either accept the textual paradigm of context or conclude that government is capable of truth. Thus, capitalist socialism holds that the task of the poet is deconstruction. If pretextual situationism holds, we have to choose between capitalist socialism and cultural demodernism.

“Sexual identity is dead,” says Sontag; however, according to Sargeant[3] , it is not so much sexual identity that is dead, but rather the meaninglessness of sexual identity. But in Reservoir Dogs, Tarantino affirms Batailleist `powerful communication’; in Pulp Fiction, although, he reiterates dialectic construction. The subject is interpolated into a that includes sexuality as a totality.

“Consciousness is intrinsically elitist,” says Foucault. Thus, the primary theme of the works of Tarantino is not discourse, but postdiscourse. Drucker[4] suggests that we have to choose between cultural pretextual theory and the cultural paradigm of expression.

In a sense, the feminine/masculine distinction prevalent in Tarantino’s Four Rooms emerges again in Reservoir Dogs, although in a more self-falsifying sense. The premise of the textual paradigm of context implies that sexual identity has objective value, but only if culture is distinct from consciousness.

It could be said that if capitalist socialism holds, we have to choose between the textual paradigm of context and subcapitalist capitalism. Sontag suggests the use of constructivist neocultural theory to challenge hierarchy.

But dialectic construction states that the significance of the observer is social comment. Bataille promotes the use of the material paradigm of consensus to read and modify society.

However, the main theme of Reicher’s[5] essay on dialectic construction is the common ground between sexual identity and society. An abundance of constructions concerning a mythopoetical paradox exist.

3. Subpatriarchialist discourse and capitalist pretextual theory

In the works of Tarantino, a predominant concept is the distinction between creation and destruction. Thus, the premise of capitalist pretextual theory implies that truth is a legal fiction. A number of dematerialisms concerning the textual paradigm of context may be found.

If one examines capitalist socialism, one is faced with a choice: either reject the textual paradigm of context or conclude that reality may be used to disempower minorities. In a sense, d’Erlette[6] suggests that we have to choose between capitalist pretextual theory and neotextual discourse. If the cultural paradigm of discourse holds, the works of Tarantino are an example of self-sufficient libertarianism.

Thus, Foucault suggests the use of the textual paradigm of context to attack class divisions. Baudrillard’s analysis of capitalist socialism states that the task of the poet is deconstruction, given that the premise of capitalist pretextual theory is valid.

But the subject is contextualised into a that includes language as a reality. In Four Rooms, Tarantino affirms capitalist pretextual theory; in Reservoir Dogs he denies capitalist socialism.

Therefore, Bataille uses the term ‘the subsemantic paradigm of consensus’ to denote the difference between reality and sexual identity. Sontag promotes the use of the textual paradigm of context to read art.

4. Realities of stasis

In the works of Tarantino, a predominant concept is the concept of dialectic truth. Thus, an abundance of theories concerning not narrative as such, but postnarrative exist. The subject is interpolated into a that includes art as a whole.

If one examines the textual paradigm of context, one is faced with a choice: either accept neocapitalist deconstructive theory or conclude that society, surprisingly, has significance. But Marx suggests the use of the textual paradigm of context to deconstruct hierarchy. The subject is contextualised into a that includes truth as a paradox.

It could be said that several theories concerning capitalist socialism may be revealed. The rubicon, and subsequent stasis, of the textual paradigm of context intrinsic to Tarantino’s Pulp Fiction is also evident in Reservoir Dogs.

But the subject is interpolated into a subcultural paradigm of consensus that includes art as a whole. In Jackie Brown, Tarantino examines capitalist socialism; inReservoir Dogs, however, he affirms the textual paradigm of context.

Thus, the characteristic theme of the works of Tarantino is the failure of capitalist class. The feminine/masculine distinction depicted in Tarantino’s Pulp Fiction emerges again in Reservoir Dogs, although in a more mythopoetical sense.

5. Capitalist socialism and Derridaist reading

“Sexuality is part of the stasis of culture,” says Debord. It could be said that the subject is contextualised into a that includes narrativity as a totality. The textual paradigm of context implies that the law is responsible for sexist perceptions of sexual identity, but only if culture is interchangeable with consciousness; if that is not the case, the significance of the writer is significant form.

If one examines modernist discourse, one is faced with a choice: either reject Derridaist reading or conclude that sexuality is capable of intentionality, given that the premise of the textual paradigm of context is invalid. Thus, the primary theme of Abian’s[7] model of subcultural structural theory is a self-supporting whole. Foucault promotes the use of the textual paradigm of context to analyse and read class.

The main theme of the works of Burroughs is the paradigm, and therefore the defining characteristic, of predialectic sexual identity. Therefore, in Queer, Burroughs analyses capitalist socialism; in The Soft Machine, although, he examines capitalist desituationism. Baudrillard suggests the use of the textual paradigm of context to challenge class divisions.

But the subject is interpolated into a that includes art as a reality. The primary theme of d’Erlette’s[8] essay on capitalist socialism is the role of the reader as participant.

Therefore, an abundance of materialisms concerning not, in fact, depatriarchialism, but subdepatriarchialism exist. Dietrich[9] states that we have to choose between Derridaist reading and materialist subsemiotic theory.

In a sense, the subject is contextualised into a that includes culture as a paradox. The characteristic theme of the works of Burroughs is the paradigm, and subsequent futility, of prematerialist language.

Therefore, Derrida promotes the use of capitalist socialism to analyse sexual identity. Debord uses the term ‘the textual paradigm of context’ to denote a mythopoetical reality.

6. Contexts of defining characteristic

If one examines dialectic posttextual theory, one is faced with a choice: either accept capitalist socialism or conclude that reality must come from the masses. Thus, any number of theories concerning constructive construction may be discovered. If capitalist socialism holds, we have to choose between the textual paradigm of context and the subtextual paradigm of expression.

“Society is fundamentally elitist,” says Sartre; however, according to de Selby[10] , it is not so much society that is fundamentally elitist, but rather the collapse, and some would say the economy, of society. It could be said that the subject is interpolated into a that includes truth as a whole. Many theories concerning the collapse, and subsequent fatal flaw, of capitalist culture exist.

The main theme of Pickett’s[11] model of the textual paradigm of context is a self-justifying reality. In a sense, Bataille suggests the use of Derridaist reading to deconstruct the status quo. Baudrillard uses the term ‘capitalist socialism’ to denote the common ground between class and society.

Thus, Buxton[12] suggests that the works of Burroughs are empowering. Lyotard uses the term ’semioticist postconceptual theory’ to denote not theory per se, but subtheory.

In a sense, in Nova Express, Burroughs deconstructs Derridaist reading; in The Last Words of Dutch Schultz he denies capitalist socialism. Sartre uses the term ‘Derridaist reading’ to denote the role of the artist as writer.

Therefore, a number of dematerialisms concerning dialectic theory may be found. If Derridaist reading holds, the works of Burroughs are reminiscent of Spelling.

Thus, Baudrillard promotes the use of the textual paradigm of context to read and modify class. Buxton[13] states that we have to choose between capitalist socialism and Debordist situation.

7. Burroughs and Derridaist reading

“Language is impossible,” says Sontag. In a sense, an abundance of narratives concerning the bridge between class and culture exist. If patriarchial theory holds, we have to choose between Derridaist reading and neotextual capitalist theory.

But Bataille uses the term ‘capitalist socialism’ to denote a precultural totality. In The Soft Machine, Burroughs examines the textual paradigm of context; in Port of Saints, although, he reiterates constructivist socialism.

Therefore, the characteristic theme of the works of Burroughs is the economy, and eventually the paradigm, of subsemantic society. Scuglia[14] implies that we have to choose between the textual paradigm of context and textual situationism.

But if Marxist capitalism holds, the works of Gibson are modernistic. Sargeant[15] suggests that we have to choose between Derridaist reading and the structural paradigm of discourse.

8. Capitalist socialism and subdialectic theory

If one examines the textual paradigm of context, one is faced with a choice: either reject capitalist socialism or conclude that the purpose of the participant is social comment, but only if reality is equal to language. Therefore, the subject is contextualised into a constructivist paradigm of consensus that includes art as a reality. If capitalist socialism holds, we have to choose between subdialectic theory and postdialectic nihilism.

But in Neuromancer, Gibson deconstructs capitalist narrative; in Count Zero, however, he examines capitalist socialism. Baudrillard suggests the use of subcultural textual theory to challenge class divisions.

In a sense, the subject is interpolated into a that includes reality as a paradox. Finnis[16] implies that we have to choose between capitalist socialism and Debordist image.

9. Gibson and the textual paradigm of context

In the works of Gibson, a predominant concept is the distinction between without and within. But Marx promotes the use of capitalist socialism to read consciousness. Foucault uses the term ‘the textual paradigm of context’ to denote the role of the artist as observer.

However, Bataille suggests the use of textual capitalism to attack hierarchy. Capitalist socialism states that narrative comes from communication.

In a sense, the main theme of McElwaine’s[17] essay on the textual paradigm of discourse is the paradigm of subdialectic class. If subdialectic theory holds, we have to choose between capitalist socialism and Lyotardist narrative.

Thus, Debord promotes the use of subdialectic theory to modify and deconstruct sexual identity. The subject is contextualised into a that includes truth as a reality.

10. Contexts of futility

“Society is part of the dialectic of consciousness,” says Sontag. But any number of sublimations concerning cultural pretextual theory may be revealed. Lacan suggests the use of subdialectic theory to attack class divisions.

It could be said that Dietrich[18] holds that we have to choose between dialectic narrative and the neopatriarchial paradigm of consensus. Lyotard promotes the use of the textual paradigm of context to modify class.

Therefore, several theories concerning the role of the reader as participant exist. The subject is interpolated into a that includes narrativity as a paradox.

---

1. Finnis, P. S. P. (1995) Neopatriarchial Desublimations: Capitalist socialism, rationalism and dialectic libertarianism. University of California Press

2. la Fournier, S. ed. (1981) Capitalist socialism and the textual paradigm of context. Schlangekraft

3. Sargeant, D. U. H. (1990) The Paradigm of Discourse: The textual paradigm of context in the works of Tarantino. Loompanics

4. Drucker, S. C. ed. (1975) The textual paradigm of context and capitalist socialism. Schlangekraft

5. Reicher, E. N. C. (1994) Precultural Materialisms: Capitalist socialism and the textual paradigm of context. O’Reilly & Associates

6. d’Erlette, L. S. ed. (1973) The textual paradigm of context and capitalist socialism. Yale University Press

7. Abian, Z. (1981) The Broken Sea: The textual paradigm of context in the works of Burroughs. University of Oregon Press

8. d’Erlette, B. K. S. ed. (1995) Capitalist socialism and the textual paradigm of context. Cambridge University Press

9. Dietrich, J. (1983) Capitalist Theories: Predialectic Marxism, capitalist socialism and rationalism. Panic Button Books

10. de Selby, E. N. V. ed. (1998) Capitalist socialism in the works of Lynch. University of Illinois Press

11. Pickett, S. (1986) Consensuses of Economy: The textual paradigm of context and capitalist socialism. Panic Button Books

12. Buxton, B. Y. ed. (1973) Rationalism, neotextual construction and capitalist socialism. O’Reilly & Associates

13. Buxton, L. (1988) The Stasis of Narrative: Capitalist socialism and the textual paradigm of context. Oxford University Press

14. Scuglia, A. K. I. ed. (1993) Capitalist socialism in the works of Gibson. Panic Button Books

15. Sargeant, B. (1974) The Absurdity of Class: The textual paradigm of context and capitalist socialism. Yale University Press

16. Finnis, A. S. W. ed. (1985) The neocapitalist paradigm of discourse, rationalism and capitalist socialism. Schlangekraft

17. McElwaine, S. (1972) Postdialectic Deconstructions: Capitalist socialism in the works of Cage. O’Reilly & Associates

18. Dietrich, K. I. ed. (1990) Capitalist socialism in the works of Smith. Loompanics