Karl Marx: The Comeback Kid

Posted: April 10, 2011 | Author: | Filed under: Economic Develpment, financial institutions, Global Financial Crisis | Tags: , , , , , | 23 Comments
Owners of capital will stimulate the working class to buy more and more of expensive goods, houses and technology, pushing them to take more and more expensive credits, until their debt becomes unbearable. The unpaid debt will lead to bankruptcy of banks, which will have to be nationalised, and the State will have to take the road which will eventually lead to communism”

Karl Marx, Das Kapital, 1867

Okay, I got your attention and that’s my purpose.  I’m really not a closet Marxist, but I do feel that some of that old school political economics he brought to the realm of economic thinking way back when is still worth contemplating.  The above quote from Marx is a fairly good summation of his intellectual endeavors.  He starts out with some really great assumptions then jumps the shark with vague, unmapped conclusions,  But, Marx was a philosopher and jumping sharks seems to be an occupational hazard for them.  Economics these days relies on mathematical models and empirical study.

Marx is one of those folks–along with equally fringe Frederick Hayek– who is getting a second look in a back-handed way.  What’s pretty interesting is that a lot of the criticism of Marx and Lenin forgets that they had more against “financial capitalists” than they had against “industrial capitalists”.   Both Rand and Ron Paul sort’ve remind me of them in that way.  Marx actually looked at us ideally as a society of producers. He didn’t like how financiers fit into that picture at all. He railed against the UK’s Bank Act of 1844 that was a response to a fairly huge financial crisis. He argued that the “1844 Act had been deliberately designed to keep interest rates artificially high, benefiting the financial section of the capitalist class at the expense of the industrial section”.  He also had a lot to say about paper money that wasn’t convertible to things like gold and it’s hard not to hear Marx in Ron Paul’s diatribes.

Marx also introduced the idea of commodity fetishism, which is a fairly compelling description of the modern US economy. He felt we’d all become slaves to it eventually.  So, even though he never really fleshed out much worth implementing, he and Lenin had some interesting commentary on what they saw as problems that would arise from a society that became increasing focused on financial services and became addicted to consumer goods.

In an odd way, the financial crisis has brought on renaissance of the Marxist critique as well as a huge number of libertarians that are trying to have a Hayekian renaissance.   Academics that study financial economics are asking similar questions but not quite in the way that you would think.  The odd thing is that the very line of research that used to soundly tromp the Marxist assumption of the financial capitalist as parasite is sort’ve headed towards a refinement of the idea that too many bankers spoil the economy.

Every one is pretty much in agreement that much of the time, market economies do a fairly good job of sorting out who gets what.  You can even speak with economists in Cuba and find out they are all planning for liberalization as long as it doesn’t reintroduce a flurry of exploitation. The problem is that real life markets don’t function very well when there are too many ‘frictions’.  Just as in physics, frictions deform things.  Frictions are basically things that cause less-than-efficient outcomes in markets where efficiency is strictly defined as the maximum quantity produced at a minimal price.  In some cases, these things are caused by governments.  Regulations, tariffs, quotas, and taxes can all cause frictions.  Some are put in place purposely to warp the market outcome as is the case with sin taxes.  Third party payers–like the health insurance industry–create frictions. Advertising creates incredible frictions.

Markets can have naturally occurring frictions like the placement of oil reserves or diamonds or gold in certain locations in the world.  They can have frictions due to technology or economies of scale where it’s most efficient to have a single producer or monopoly because it is least expensive or necessary to create the minimal cost plant size.  Think how huge car manufacturing or steel plants have to be so they are cost effective.  Frictions are everywhere and they warp market outcomes.   Free Market fetishists tend to ignore any friction not created by the government.   In some cases, government is the source of the friction; in other cases, government–through regulation or policing of markets–can remove the frictions.   Financial markets are riddled with two notorious frictions:  information asymmetry and moral hazard.  You can see how Marx grasped those problems philosophically. Lenin actually did studies using numbers.  Hayek had his explanations of financial crises as did J.M. Keynes.  Keynes went so far to say that financial markets were driven by “animistic spirits”.  We’ve come a long way since all of them were actively writing but yet, some of the themes remain the same in new veins of inquiry.

There are several things out in the blogosphere that have brought me to discuss this topic with you.  The first is a NYT editorial called ‘Banks are Off the Hook Again’.  Banks are trying to get Federal lawmakers to override state laws on foreclosure in an attempt to avoid prosecution and the results from their foreclosure practices.  They are–per usual–succeeding.

As early as this week, federal bank regulators and the nation’s big banks are expected to close a deal that is supposed to address and correct the scandalous abuses. If these agreements are anything like the draft agreement recently published by the American Banker — and we believe they will be — they will be a wrist slap, at best. At worst, they are an attempt to preclude other efforts to hold banks accountable. They are unlikely to ease the foreclosure crisis.

All homeowners will suffer as a result. Some 6.7 million homes have already been lost in the housing bust, and another 3.3 million will be lost through 2012. The plunge in home equity — $5.6 trillion so far — hits everyone because foreclosures are a drag on all house prices.

The deals grew out of last year’s investigation into robo-signing — when banks were found to have filed false documents in foreclosure cases. The report of the investigation has not been released, but we know that robo-signing was not an isolated problem. Many other abuses are well documented: late fees that are so high that borrowers can’t catch up on late payments; conflicts of interest that lead banks to favor foreclosures over loan modifications.

The draft does not call for tough new rules to end those abuses. Or for ramped-up loan modifications. Or for penalties for past violations. Instead, it requires banks to improve the management of their foreclosure processes, including such reforms as “measures to ensure that staff are trained specifically” for their jobs.

This is a really good example of maintenance of mutually destructive frictions in a market.  It creates uncertainty.  It does not contribute to translucence and information.  It ensures a lop-sided process.  In short, it guarantees certain market failure and it sets up the winners and the losers.  It’s something about which both Marx and Hayek would rant. For that matter, J.M. Keynes wouldn’t be so judicious about it either.

Read the rest of this entry »

Saturday Night Delights

Posted: April 9, 2011 | Author: | Filed under: just because | Tags: , , , , , | 22 Comments

Hi!

Thought I’d put up an open thread with some interesting tidbits that I’ve seen in the news recently.  I also wanted to update you on a few tidbits about the blog too.  On  Thursday, we reached our 3 month name change (actually, it’s the permanent addie that changed) anniversary.  On the 27th, we’ll have left file cabinet status for six months now.  If you look down there at the print screen captured from Technorati earlier this week, you’ll see that we made Top 100 US Political blogs. Actually we did it twice this week and we’re still lingering at the high end.  This one was the second occurence and we were sitting squarely on number 100.  We’re the little blog that can ’cause we try harder!

So, here’s some interesting ‘stuff’.

NPR reports that Egyptians Mummies have been found with clogged arteries.  Guess there was high cholesterol around back then too.

Heart disease is supposedly a modern affliction, the result of a diet rich in animal fat and too many hours spent on the sofa. But recent discoveries suggest that strokes and heart attacks may have been bedeviling humans for millenia.

Dr. Greg Thomas is part of a team of scientists that recently discovered the earliest known case of atherosclerosis — clogged arteries — in ancient Egyptian mummies. The startling findings mean scientists may not understand heart disease as well as they think they do.

The Large Hadron Collider appears to be on the verge of finding a new particle according to Wired.  Physics has to be the neatest science on the planet right now.

Theorist Moira Gresham of the University of Michigan says many explanations for the Tevatron asymmetry predict new particles that could be seen at the LHC — even though it is now running at only half its maximum energy. She and her colleagues posted a paper on the proposed properties of several such particles at arXiv.org on March 18, one of a flurry of articles that have appeared in response to the Tevatron finding.

Among the possible particles is a heavy cousin tothe massless gluon, the particle that binds quarks together. Another idea, noted in a paper posted at arXiv.org on April 1, posits the existence of a particle called the Z’ boson, a heavier version of the Z boson, a messenger particle for the weak interaction. The Z’ boson would transforms one type of quark into another, leading to the asymmetry.

“Particle physicists know that the standard model is incomplete,” Gresham says. “We’ve been waiting a long time to get some more concrete hints.”

Okay, I’m going to share one that you’re sure to like. Here’s a list of the best chocolate bars from Real Simple magazine. They also have stuff there like the best 50 recipes using chocolate too.  Here’s one that sounds great!

Double Chocolate-Chip Cookies

Ingredients

Directions

  1. Heat oven to 350°F. Cream the butter and sugars in a large bowl with an electric mixer on high speed. Lower to medium speed and add the egg and vanilla. Sift together the flour, cocoa, baking soda, baking powder, and salt. On low speed, add the dry mixture to the butter mixture. Beat until fully incorporated. Fold in the chocolate chips.
  2. Form the dough into approximately 1 1/2-inch balls. Place on parchment- or foil-lined baking sheets, 2 inches apart.
  3. Bake until the centers are just set, about 12 minutes. Let cool on sheets for 5 minutes, then transfer to wire racks.

This week’s Rolling Stone‘s asked the  question “Who is the best lead singer of all time?”.  You can go answer them or maybe you can offer up your own.  Here’s my two offerings.  Robert Plant singing a song with Queen in a tribute to Freddie Mercury.  Oh, and it’s a Led Zeppellin song before he switches to singing ‘Crazy Little thing called Love”.  Every time I’ve see Robert Plant in concert, I go weak in the knees. He did to me as a teeny bopper and he still does it to me today.  Even, if he’s traveling around with Allison Krause.

Okay. So, hopefully this puts you in a good mood and we forget the beltway madness for awhile!  Happy Saturday Night every one!  Oh, and share!!!   I want folks to top my chocolate recipes, lead singer suggestions, and discovery trivia!

Religious Extremists in House Hold up Budget over Planned Parenthood Funding

Posted: April 8, 2011 | Author: | Filed under: Women's Rights | Tags: , | 18 Comments

Will Obama and the Democrats Cave to the Xtian Taliban sitting in Congress?

Democratic officials familiar with the negotiations said that proposed restrictions on money for Planned Parenthood remained the chief sticking point, and that attempts to resolve the disagreement through alternatives like allowing a separate floor vote on the issue had not been successful. Democrats said they were told by the Republicans that the votes of anti-abortion social conservatives would be needed to move any budget measure through the House.

From NPR:

But Reid called it a battle over ideology.

“The debate has nothing to do with the number — it has everything to do with women’s health,” he said, referring to funding of Planned Parenthood during a Friday news conference. “That’s the only issue that was left undone when we left the White House last night.”

Jeff Zients of the Office of Management and Budget, who is overseeing preparations for a possible shutdown, said both the economy and public confidence in the federal government could suffer — even if a shutdown only lasted through the weekend.

“When I think about the scale of the number of operations that will be shut down and then would have to be reopened, I think the impact on the economy even for a short period of time could be relatively significant,” Zients told reporters Thursday.

Call your senators and representatives and tell them not to cave to Religious Extremists.

More from Think Progress:

Three Anti-Abortion Republicans Tell House GOP To Drop Planned Parenthood Rider To Avoid Shutdown

While many Republicans are committed to holding up the budget over a social issue, at least three anti-choice Republicans are recognizing the absurdity of such an obstacle. Sens. Pat Toomey (R-PA), Tom Coburn (R-OK) and — surprisingly — Rep. Michele Bachmann (R-MN) have signaled a willingness drop the policy rider to reach an agreement and avoid a shutdown:

– Toomey on MSNBC: “I think what we should do is cut spending as much as we can, get the policy changes that we can, but move on, because there are other, bigger battles that we are fighting,” he said yesterday.

– Coburn on MSNBC: “And my recommendation to my friends in the House is, you know, it’s highly unlikely that many riders are going to get passed with a Democrat president and a Democrat Senate, so why don’t you take the spending and let’s get on to the budget,” he said Wednesday.

– Bachmann on CNN: “I think that we should have a clean bill that makes sure that the paychecks get to the troops on time,” she told CNN’s John King yesterday.

Friday Reads: Fresh Hells brought forth by Republicans

Posted: April 8, 2011 | Author: | Filed under: abortion rights, black women's reproductive health, morning reads, Violence against women, We are so F'd, Women's Rights | 16 Comments

I wish I could really say good morning, but I have to say that I’m getting more discouraged all the time.  It feels like the Republicans are destined to bring on The Handmaid’s Tale future.  There should be no complaining around here about burkhas because it seems we’re being enslaved by the same narrow minds here in this country with the same degree of ignorance and intolerance.  We’ve turned from a nation of scientists, inventors, and pioneers into something completely different.  We better start fighting the ignorance coming from pews and Republican Congressional districts now or everything we have come to know and love about this country will be gone.  One hundred fifty years after the beginning of the Civil War, we now have another war seeking to create slaves rather than free them.

First, a selection of how a few robed men with their own religious jihad have become jurists in favor of dismantling some one of the most central tenets of The Constititution:  The Establishment Clause. Every citizen in this day and age should be able to show the damage done by religionists in this country.  It will be a difficult task, however.

In a decision earlier this week in Arizona Christian School Tuition Organization v. Winn, the five conservative Justices on the Supreme Court (Roberts, Scalia, Kennedy, Thomas and Alito) carved a large hole out of the Establishment Clause of the First Amendment. Although the issue in the case was subtle, the consequences are not.

The First Amendment prohibits government to make any law “respecting an establishment of religion.” A central concern of the Establishment Clause, in the words of James Madison, was to forbid government “to force a citizen to contribute” even “three pence of his property for the support of” religion. As the Supreme Court recognized more than forty years ago, as a general proposition the Establishment Clause prohibits government from using its “taxing and spending power… to favor one religion over another or to support religion in general.” Thus, the Establishment Clause forbids government to fund churches to enable them to spread their religious beliefs or to award special tax credits to individuals to reimburse them for their contributions to religious organizations.

There is a complication, however. Even though such government programs violate the Establishment Clause, it is not clear whether anyone can legally challenge them. To bring a lawsuit contesting a law’s constitutionality, a plaintiff must have “standing” to sue. To have standing, a plaintiff must have suffered a distinct “injury in fact” as a result of the government action he wants to challenge. Standing is necessary because we want the parties to have a meaningful stake in the outcome of litigation. Otherwise, they might not adequately represent their position, which could result in a waste of judicial resources or, even worse, erroneous decisions.

Why should I have to subsidize some one’s superstitions?  I certainly will get no benefit from it nor will society.

Idaho lawmakers are seeking to force raped women to bring pregnancies to term because it is the will of “The Almighty”. (H/T to BB) That some one’s imaginary friend should hold every one hostage is anathema to me.  We have to ask when the witch burning will begin, when will we return to biblical stoning, and under what conditions will slavery be okay?  This also completely bans induced labor under strict term.  There are no ‘abortions’ in the third trimester.  That’s one of those word games religionists play to confuse the easily confused.  So, what happens if you have a brain dead baby or one that’s dead and the remains go septic?  Do you just sit around and wait for their imaginary friend to do something?  How are all these radical measures coming to pass?  Where are the reasonable people in this country?

The Idaho legislature on Tuesday gave final approval to a measure that would outlaw abortions after 20 weeks of pregnancy and subject abortion providers to criminal prosecution and civil lawsuits.

The Senate-backed bill cleared the House in a 54-14 vote and now heads to Governor Butch Otter, who is expected to sign it.

This person actually believes a rapist is the hand of god?  Representative Shannon McMillan needs to go back and figure out that a fertilized egg is in no way a child and that forcing women to hangers and back alleys isn’t going to save lives.

“Is not the child of that rape or incest also a victim?” asked Rep. Shannon McMillan, R-Silverton. “It didn’t ask to be here. It was here under violent circumstances perhaps, but that was through no fault of its own.”[…]

The Idaho bill’s House sponsor, state Rep. Brent Crane, R-Nampa, told legislators that the “hand of the Almighty” was at work. “His ways are higher than our ways,” Crane said. “He has the ability to take difficult, tragic, horrific circumstances and then turn them into wonderful examples.”

It looks like “clerical error” has returned the vote advantage to Right Wing Radical extremist David Prosser to the Supreme Court in Wisconsin.  He’s best known for calling a colleague a bitch.  The assault on women’s rights, worker’s rights,  and ordinary people will continue there.

Nickolaus says the reason for the big change is that data transmitted from the City of Brookfield was imported but that she failed to save those results to the database. Brookfield cast 14,315 votes on April 5 — 10,859 of those votes went to Prosser and 3,456 went to JoAnne Kloppenburg.

Congressional Republicans are trying to blame the budget stalemate and the ensuing bad PR of not paying soldiers in combat on Democrats.  The truth comes out that they are quibbling over funding Planned Parenthood and not the numbers.  It’s really quite shameful.  Maybe the Democrats and Obama are figuring out that these people do not negotiate, they only take hostages.  The Democrats offered to pass a troop funding standalone bill 3 times but were turned down.

Today, House Republicans pushed through their stopgap measure in a 247-181 vote. The bill, H.R. 1363, quickly came under fire for demanding a series of non-budget related policy riders, including an anti-abortion policy restriction banning D.C. from using its own local funds for abortions and anti-environmental restrictions to limit the EPA from regulating green house gas emissions, on top of an extra $12 billion in cuts. “With an eye to protecting themselves politically” from blame, the GOP quickly redefined H.R. 1363 today as the “troop funding bill.”

Slate’s Dave Weigel noted that five minutes after the White House declared H.R. 1363 unacceptable, House Majority Leader Eric Cantor (R-VA) slammed President Obama for threatening to veto a bill to “ensure that our troops are paid.” Minutes later, Rep. Tom Latham (R-IA) ripped Democrats for “girding to oppose a ‘troop-funding bill.’” Republican lawmakers quickly picked up the rallying cry. Reps. Mike Pence (R-IN) and Harold Rodgers (R-KY) called it “astonishing” and “inexplicable” that Obama would, as GOP shutdown architect Newt Gingrich put it, use the troops as “bargaining chips for budget negotiations.”

There’s only one problem with this talking point — it’s the opposite of true. Today, the House Democrats tried three times to pass a measure that would ensure the troops received pay. The Republicans overwhelmingly opposed every single “troop-funding” opportunity  …

Nancy Pelosi is now saying there is a war one women and predicts a ‘strong Democrat Response to the recent events. One has to wonder where it was when they sold out on tax cuts that would bring on this situation.  One also has to wonder about where these folks were when they were eviscerating women’s right to have private insurance with abortion riders a year ago too.

“I think you’ll see a strong Democratic ‘no’ on that,” Pelosi said of the funding measure, “and I would hope that the president would veto that bill.”

Rep. Chris Van Hollen (Md.), senior Democrat on the House Budget panel, called the Pentagon funding “a cynical ploy to use our troops to try to impose the Republican agenda through the budget process.”

Pelosi agreed, and predicted the attempt to lure Democratic votes won’t work.

“For them to hide behind our troops while they build a future unworthy of the sacrifice of our troops … is a contradiction in terms,” she said. “I believe we’ll have a solid vote against that.”

These are truly trying times.  We have people who do not embrace modernity, science, or reason making policy right now.  They’ve also had time to stack a lot of courts with justices who appear to care more about their religion than The Constitution.  We’re assaulted on all fronts by radicals who seek to redefine this country in theocratic terms and are willing to ruin it to bring about an end to everything that protects the pubic interest and public assets.  The costs will be huge if this stuff succeeds.

Anyway, I can’t read any more of the headlines without wanting to ask Canada for sanctuary.  If you’ve got anything better on your reading or blogging list, please share it.  I just would like to get my assets and my daughters out of here before they’re declared breeders and kidnapped by some infertile white couple in the name of their angry sky god.

Uppity Woman suggests that we join the ACLU and women in the state of Florida and “incorporate” each and every uterus in the country so the Republicans will want to deregulate them and free them from taxes.  Here’s the link to Incorporate My Uterus!  Sigh.

So many religionists, so few lions.

Oh, and if you want to get stirred up, go watch CSPAN and the Stand Up for Women’s Health Rally:

Stand Up for Women’s Health Rally Planned Parenthood, NARAL Pro-Choice America, and more than 20 other organizations will hold a Stand Up for Women’s Health rally at the U.S. Capitol in opposition to proposals in Congress.

From the NYT:

On Thursday, Republicans passed a one-week spending bill — one almost surely destined to fail in the Senate — that featured one of the key provisions they are seeking.

The measure would reinstate a policy, scotched a few years ago by Democrats, that prevented the District of Columbia from using locally generated taxes to provide financial help to poor women for abortions. (The use of federal funds for abortion is already prohibited.) Because this law was on the books for years — passed by Democrats as a rider to unrelated bills — it has perhaps the best chance of surviving in any spending compromise.

Republicans also seek to prohibit payments for abortions overseas — a measure known as the “Mexico City” policy that was overturned by an executive order from Mr. Obama. Another rider seeks to end the United States’ contribution to the United Nations Population Fund, which focuses on reproductive health.

Finally, rather than cut all federal funds for Planned Parenthood, House Republicans would like to take the money given to it and other family planning organizations and give it to state health departments to spread at their discretion.

Welcome to the Results of TransOcean’s Record Safety Year

Posted: April 7, 2011 | Author: | Filed under: Gulf Oil Spill | Tags: , , , , , | 28 Comments

Republicans are busy today with their attempts to dismantle the EPA because, after all, they stop businesses from doing so much business, right?  No reason told businesses back, is there?  Those paragons of job creation and responsibility are just drowning in EPA regulation.   Meanwhile, dead dolphins, drowning in BP oil continue to wash ashore down here in Louisiana. Ask me why I haven’t eaten anything from the Gulf for months now. Aren’t you glad Transocean had the best safety year evah?

The National Oceanic and Atmospheric Administration says that eight months after the Deepwater Horizon oil well was capped, dolphins are washing ashore in east Louisiana with some oil from that spilled on their bodies.

Spokeswoman Kim Amendola says the dolphins had spots of weathered oil.

Blair Mase — NOAA’s Gulf Coast stranding coordinator — emphasizes there’s no way yet to know why the dolphins died. She says the most recent dolphin bearing BP oil was found two weeks ago.

Mase says 15 dolphins with confirmed or suspected oil on their bodies washed ashore since the spill began last April — and eight had oil from that well, which was capped July 15.

I thought we got told that little miracle microbes ate it all.  Get the feeling NOAA is covering up stuff again?

Related News:

Feds forbid scientists probing Gulf dolphin deaths from speaking to media

Dolphins accidentally drowned by scientists trawling in Gulf

The National Oceanic and Atmospheric Administration says federal scientists trawling for fish to test for possible damage from last year’s Gulf of Mexico oil spill accidentally caught and drowned three dolphins.

Spokeswoman Connie Barclay says the pantropical spotted dolphins were caught Wednesday by scientists on the NOAA research ship Pisces, which works out of Pascagoula, Miss.

She said Friday that NOAA is reviewing the incident and will conduct an enforcement investigation.

 

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