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Random thought for the day

(Quiet at present, because I'm busy clearing my desk before next week's trip to Seattle and Spokane.)

Some of you might have noticed the acronym TTIP in the news— TransAtlantic Trade and Investment Partnership. Superficially it's just another free trade deal, with corresponding trade agreements being negotiated for the Pacific Rim and other zones. It's raised a lot of concern because it has largely been negotiated under conditions of heavy secrecy, with extreme measures taken to prevent leaks—despite which, drafts of the treaty have escaped and sparked huge controversy.

In particular, TTIP and the related agreements provide for binding arbitration to be imposed in disputes between signatory states and overseas corporations or investors—in effect delegating national sovereignty to an unelected private tribunal of lawyers.

So here's my speculation: there are worrying signs that nothing has been learned since the 2007/08 fiscal crisis—or rather, that the banking and investment establishment has concluded that moral hazard is a busted flush. We're in another investment bubble, the Chinese stock market is already in free fall, we've got food/water scarcity wars in the middle east, the Fed's Quantitative Easing program has ended and the Bears are getting Bearish ... the auguries are pointing towards a sequel to 2007, or something close enough to scare the pants off everyone. Meanwhile, the UK and Germany are governed by cynics who are still slapping themselves on the back for figuring out that austerity has the inituitive appeal of kitchen-sink economics for the illiterate, making it an easy sell to stay in power. And we're seeing a scary global rise in the militarisation of police forces.

So here's my open question: is it plausible to consider the secretive binding arbitration provisions in TTIP to be a pre-emptive move to prevent an assertion of people power by angry disenfranchised electorates after the house of cards comes tumbling down at some point in the next 5 years? TTIP is due to be ratified by next year, and once locked in, it would be really difficult for a government (however popular) to move unilaterally to demand an accounting of its creditors. Think Syriza in Greece confronting its creditors with a massive democratic mandate and being told to lube up and bend over—but on a global scale, with everyone in the same boat.

It's fairly clear that one of the defining characteristics of the 21st century so far has been the creeping installation of a system optimized to exclude public opinion from the levers of power despite continuing to pay lip service to principles of democratic accountability: is this another (and big) step in ensuring that democracy can't actually threaten the interests of the global financial sector?

Am I being paranoid here? Or not paranoid enough?

396 Comments

1:

The problem is that Syriza folded.
The only people who won't fold under such conditions are hardcore nationalists.

2:

I think the conclusion that this is a preemptive attempt to lock in power structures assumes a level of foresight, socioeconomic understanding, and guile that isn't warranted by the actual actions of our "ruling elite".

It is more prioritizing economic interests over democratic interests and it is crap on those grounds, but it isn't a cunning plan. At best it may turn out to be an unforeseen double win for them.

3:

My advice: Invest in lube.

4:

Parliament is still sovereign, and it's an ancient constitutional principle that nothing one Parliament does can be binding on a subsequent Parliament. So any future government could simply derogate or withdraw from TTIP if it wanted to and was prepared to suffer the consequences to its international trade. There's no way for the UK to commit to a treaty of any kind in perpetuity.

5:

The hell of all this is (or one of them) is that hindsight is 20/20.

Are the arbitration rules in the TransAtlantic Trade and Investment Partnership an attempt to forestall people power? I don't know if that's the point, but it might be a "Value add" on their part.

6:

I vote for not paranoid enough. What makes me second-guess my paranoia is I cannot quite sort out the proper arrangement of nefarious and gullible actors to make for a proper conspiracy that intended such an outcome.

Perhaps the road-to-hell is instead paved with conventional wisdom and short-term avarice?

7:

I think the conclusion that this is a preemptive attempt to lock in power structures assumes a level of foresight, socioeconomic understanding, and guile that isn't warranted by the actual actions of our "ruling elite".

You could easily be right. On the one hand, OGH has seen it.

On the other hand, the "ruling elite" is not an organized conspiracy but a large group of people who might be individually smart but who together have less intelligence and coordination than a slime mold.

So while Charlie, and Dirk, and you, and me, and Dave, and Princejvstin have seen it, and some individual members of the "ruling elite" may also be smart enough to see it, we can be pretty sure that it is not a cunning plan, because the "ruling elite" as a group has nothing going for it but the wisdom of crowds.

8:

Not paranoid enough.

Rather than talk about "you get what you reward" and iterated selection and point out that the last refuge of unfettered exercise of power is the corporate boardroom, I'll point out that US foreign policy after the Second World War is notable for overthrowing highly democratic social democratic governments for not being capitalist enough. Democracy was never the issue.

If it was obvious then that capitalism isn't compatible with democracy (it's so very much not), I can't see what could possibly have changed that would make capitalism compatible with the rule of law.

Not is it useful or practical to be against this; no amount of "against" is going to have noticeable results. If we want something different, we have to come up with another form of social organization that can win a fight with the existing corporatism and sucks less to inhabit.

It's a hard problem.

9:

My pet theory is that democracy can't threaten the interests of the global financial sector in the first place. It's getting increasingly more difficult to make the argument that an informed public in a free voting system would correlate with the decision that's the most beneficial to the group.

When things are as complicated as the long-term ramifications of trade agreements or environmental policy, the amount of noise has to far outweigh the signal. And humans as a species, are insanely susceptible to many forms of cognitive bias. And it seems that many humans have become very adept at exploiting these for their own gain. Cue popcorn.

I don't see any easy answers. I have a fervent hope that boosting the average education level of everyone would result in a drop in average aggression. That is my personal cognitive bias: I have no idea how many unintended consequences lurk.

My personal view is that I'd be much happier with smarter people next to me and a slightly lower quality of life, than with dumber people next to me and a higher quality of life.

10:

"Not paranoid enough", I would say... I don't think that "a system optimized to exclude public opinion from the levers of power despite continuing to pay lip service to principles of democratic accountability" is a 21st-century phenomenon. I think it is simply a description of what a "democratic" system actually is in practice. The difference between systems of government is largely a matter of how they deal with dissent: whether dissenters are simply shot, or whether they are dealt with by psychological warfare. That the latter is called "democracy" shows that it works.

11:

TTIP appears to be the usual opportunistic power grab on behalf of corporate interests I suspect the worst of it will get neutured before next year - that's if the timetable remains on track which is unlikely. The Greek crisis was more about the German state vs Greece rather than corporate interests per se. It's a great shame that the Greeks caved.

German and British austerity are very different in nature - their failure to countenance QE has helped flush the Eurozone down the toilet.

I for one always favour cockup over conspiracy - for instance the Banks at the moment are fully engaged in lubing themselves up for the latest regulatory shafting - not that it isn't deserved but - they have little attention to spare for global master plans.

12:

think it is simply a description of what a "democratic" system actually is in practice.

No.

The important point about constitutional democratic forms of government is that they provide a mechanism for the peaceful transfer of power when the incumbents shit the bed. (Which, inevitably, happens sooner or later, simply because perfect performance in governance is unattainable.) Nobody gets strung up from lamp-posts any more, they just get to lick their wounds in opposition and wait for another bite at the apple.

That's why this is so dangerous. It's not in the owners' long term interests either, if they've got the brain cells to realize it.

13:

I think TTIP/TPP are the logical continuation of a process that has been going on for a while.

International treaties are appealing to power brokers in that they are a back channel to establish national legislation without any parliamentary oversight (or public discussion, for that matter). In Europe we've been seeing this for a while, where some unpopular legislation was first pushed through at the EU level, so that on the national level everyone can say "we know it sucks, but we can't do anything about it, it's EU law" (diffusion of responsibility, no room for discussion, perfect). What's been going on with recent USrest of the world treaties feels similar.

No conspiracy is necessary to see that kind of thing expanding; it's currently one of the paths of least resistance to establish certain kinds of laws, so that's the way you try to introduce them - and yeah, if that's your favored path, you try to make things incrementally easier every time.

At least the fact that these, notionally secret, treaties get leaked very regularly indicates that not everyone attending is on board with this process.

14:

I'm often hesitant to assign conspiracy to things like this. My take on it would be that the people pushing for it genuinely believe (for the most part) that it's the best thing to do, not just for themselves but for others. The type of people who look at the financial crisis and blame it on government regulation. The type of people who think that the world would have less problems if the market had more power. The type of people that terrify me.

15:

I read somewhere that this sort of arbitration clause has been standard in trade treaties for a while. They were mainly aimed at preventing countries from nationalising corporate assets without due compensation. What has changed is that recently corporations have begun to use these clauses more widely, for example challenging changes to environmental legislation because they might affect the incoome of particular corporations.

If this is true, then what is happening is that these laws are being applied beyond their original intent. Small countries simply don't have the resources to fight their cases in American courts.

Part of this is the American approach to law suits, which seem much more common in the USA than elsewhere. It is common business practice for corporations to sue each other with respect to patents, copyright, etc and they now seem to be extending this culture to international trade.

I don't have links or sources for this so I may be barking up entirely the wrong tree.

16:

No UK government can commit a future Parliament to remain in a treaty, because Parliaments are sovereign and cannot be bound, even by previous Parliaments. All treaties signed by the UK are therefore temporary pro-tem affairs. And so any future UK government can simply derogate or withdraw from TTIP if it deems it to no longer be in the national interest.

17:

OI, less insulting slime moulds!

For an organism without a nervous system, without much command and control and operating on a mostly ad-hoc basis, they can be remarkably flexible in behaviour. They can, for instance, solve the Travelling Salesman problem fairly effectively.

18:

True but leaving could be very difficult indeed and the damage done before this extensive.

19:

Not quite paranoid enough, Charlie. Accurate, however.

Consider: over the other side of the USA, their corporate overlords' other effort to try and lock the rest of the world into eternal durance vile, the Trans-Pacific Partnership, has just collapsed in a heap, mostly due to various governments' intransigence on the whole matter of pharmaceutical pricing. The TPP promises to increase the cost of just about every medication on the books, and make it a lot harder to get generics out there (because let's face it, generics threaten the profits of the US pharmaceutical industry). The other thing which makes people just a little nervous is the ISDS (Investor State Dispute Settlement) clauses - or in other words, any dispute with a trans-national corporation gets settled according the rules of the home country of the corporation in question.

How many trans-nationals are currently incorporated outside the USA, I wonder? How many will still be incorporated outside the USA once the TTIP and TPP get signed?

Then it just becomes a rush for the bottom of the barrel, as various nations realise the way to get corporate funds invested in your country is to dismantle protections on the environment (all those horrible regulations, increasing costs and raising prices just because some greenies think people should be able to drink the water and breathe the air for free!); dismantle protections for workers (after all, people want to be able to work 20 hours a day for $2 per day local currency 365 days a year - just ask Gina Reinhart); remove all those horrible regulations protecting consumers (caveat emptor, dear boy, and if people don't like it, let them go to the law about it... as individuals, of course); tort reform, of course (because each corporation is an individual, so allowing class action lawsuits against them is a form of bullying); oh, and lowering corporate taxes while raising consumption taxes and income tax rates at the lower tax brackets. Dismantle welfare systems (you won't be able to afford them, anyway) on the grounds it's providing an incentive for the lazy buggers to go out and compete for a job; reduce publicly funded education down to the bare minimum (again, you won't be able to afford anything more) because creeping socialism; and just keep paying the police and the armed forces to keep order.

Of course, by the time the people at the top realise we're all out of readily extractable fossil fuels, and we're running out of other resources at a fair old state of knots, we'll be faced with the consequences of runaway global warming too. Given this is already predicted to potentially be enough to render the planet unliveable for homo sapiens sapiens (and most other mammalian species), one has to wonder whether the oligarchs are going to have an exit strategy other than "apres nous le deluge".

For all those wondering about the Fermi Paradox: if humans are anything to go by, the reason we can't find anyone else in the neighbourhood is because they all self-immolated.

20:

OI, less insulting slime moulds!

I did say that our economic systems have *less* intelligence and coordination than a slime mold.

But see, slime molds prove there is hope. They evolved to solve complex problems without any central control. So within the same time span they evolved, our economies could learn to solve similar complex problems without central control.

All that is needed is for many trillions of small corporations to undergo mutation and selection for sufficient geological epochs.

21:

I cannot quite sort out the proper arrangement of nefarious and gullible actors to make for a proper conspiracy that intended such an outcome.

Easy.

Paranoid speculation:


  • It's not about the politicians but about the 1%.
  • The point of austerity is to transfer public assets into private pockets.
  • It's not really a classical, cloak-and-dagger conspiracy; sure, they meet, they shoot the breeze, they do the occasional favour for each other, but it's more of an alignment of common interests without any real overall control.
  • One man controls quite a lot of the media, providing an important nexus with the politicians, politics and democracy.
  • It spans a couple of decades, not just the last few years.

22:

Not so much a conspiracy as a tendency?
I'd agree with a lack of conspiracy; those with direct influence on these agreements (government politicians, civil servants) spend a lot of time talking to people who are neutral to strongly in favour of the agreement in general (most other politicians and civil servants, business lobbyists; they may differ on specific provisions - except of course few people know the specific provisions this time round) and much less speaking to people who oppose them (protesters and less well-funded lobbyists, [usually] left-wing politicians easily dismissed as the 'awkward squad'). Self-interest and in-group bias will get you most of the rest of the way there all on their own.

23:

Oh, certainly; "the main point about democracy is simply that it provides churn without violence" is something I find myself saying every time an election comes round :) But I see that as being part of how the trick works: giving people a "choice" that doesn't really make a whole lot of difference, for various reasons, the important one here probably being that much de facto power is in the hands of the financial establishment and remains so whoever is in government.

24:

The important point about constitutional democratic forms of government is that they provide a mechanism for the peaceful transfer of power when the incumbents shit the bed.

Experience shows that the most effective way to compete in elections is to rile up the commoners with emotional appeals (mostly based on identity politics) while appealing to big donors with pro-business policies (in deep blocks of text where the commoners won't read them, but the donors' lawyers will). Eventually the system devolves into carefully differentiated brands that offer the same level of choice on economic policy as Left Twix vs. Right Twix.

25:

Au contraire, it is a cunning plan, it's just one of Baldrick's:

https://www.youtube.com/watch?v=AsXKS8Nyu8Q

But seriously, while "plan" is saying too much insofar as it implies grand conspiracies and some nefarious master minds muhawahawing behind the curtain, it's hard to deny that we see here, as Chomsky might say, a transfer of decision-making from the public (and its representatives) to unaccountable institutions. The gain in control for every interested party is so obvious that we don't need to assume a world-wide conspiracy, just self-interest.

26:

It occurs to me that lawyers are preferable to soldiers, in many ways. This isn't to spite the honor of honorable soldiers, it's simply that one has to ask whether it isn't more civilized to settle disputes in a heated arbitration, rather than on the battlefield?

As for the power seizing and avoidance of local laws, that seems to be a standard playbook of large corporations and large states, like the US. They've been doing it for decades, whether it was in pursuit of commercial gain in the age of colonial empires (how much say did those "little brown people" get in what was done to them in the name of profit?), and it was done in during the Cold War, in the name of advancing either communism or capitalism.

Now it's being done to us. Stings, doesn't it?

I tend to agree with Dirk, in the nationalism is one defense against such things. The downside is that, if the strong nationalists win, we may see disputes settled more with armies than with lawyers. It's hard to say that this will be an improvement, either on openness or in terms of destruction.

And no, I don't think it's lawful, just, fair, or wise. I just think it's the continuation of business as usual by other means.

27:

Obvious point: Greece handed over its monetary policy to the EU, while the participants to the TTIP won't go quite as far. Also worth considering that states jealously guard their power: the Australian government is currently being sued over its plain-packaging laws on cigarettes, which should be in the forefront of their minds as they sign into the TTIP. It is possible the Aussie government will push, with other governments, for more reasonable terms given such issues.

Having said that, I still think paranoia looks pretty reasonable. The lack of transparency reeks of a Machiavellian plot, and the situation doesn't have to be nearly as dire as Greece before we should all be panicking loudly.

28:

Not paranoid enough ...

(from a poster who tends toward the more optimistic POV on most topics. Need to do a thorough reading though for why not paranoid enough. Any Aussies here who are familiar with the tobacco industry vs. Aussie gov't legal scrap --- just to start things off?)

29:

. It's not in the owners' long term interests either, if they've got the brain cells to realize it.

I dunno about that, it seems to be working fine for fucking over Argentina so far. One asshole is blocking the restructuring of the country's debt because he doesn't want to take a lower return, and everyone is just shrugging and playing along even as it blasts the country's economy.

And AIG is making a play to hose the US Gov similarly, suing that the bailout they got was harmful because the investors should have been handed more money in it so the investors could have been paid at full rates as they recapitalized.

31:

It will be interesting to see what happens in Greece. The Left, in the form of Syriza promised no deal. They caved in. I suspect that at the next round of elections Golden Dawn will do exceptionally well, unless they are banned (which looks like a possibility). In the latter case, terrorism, riots, major social unrest of the violent kind. In the former case, attempts by the EU and Western financial powers to isolate and destroy Greece until they "come to their senses" and elect the usual suspects.
The message for the future is that systems that no longer listen to their people get broken, sometimes violently.
I doubt whether blood will run in the streets in the UK, but still, nasty times ahead.

32:

There's a whole lot of wanting a mechanism to prevent environmental regulation, because let's face it -- either there is a whole lot of environmental regulation, real, active, enforced by the full weight of the treasuries and armories of the State, or global warming's going to do for industrial civilization. Thing is, *so does the environmental regulation*, as industrial civilization is currently constituted.

It's always been about being able to treat air and water (and timber and ore) as free, and that turns out not to be the case. Any real fix for global warming involves a different economy, with different winners. The incumbents really intensely don't want that, and it's not hard for someone to delude themselves about scientific results, especially in the case of a contingent historical sciences.

So "sue the government to prevent lost profits" should be understand as "no real change and especially not any strong environmental regulation".

33:

The Aussie government dislikes being sued by Philip Morris so much it has stated no ISDS clauses will be included in any of its future bilateral treaties. OTOH, TPP isn't bilateral, it's not pulled out of any existing bilateral treaties with ISDS (though they usually have punishment clauses), and who knows what'll happen in 5 years' time.

34:

As long as Tsipras has 77% popularity among the populace I don't think the extreme right will have a chance to take over. And if Golden Dawn gets banned then definitely not for their popularity but for criminal actions.
I'm pretty sure Syriza will win the next 2-3 elections (taken the one this fall as a given). Because: there just isn't any plausible alternative.

35:

A reminder that a vulture fund once tried to repo the Argentinian Navy's sail training frigate.
The relevance? They were told to piss off by the International Tribunal for the Law of the Sea. Have you noticed how many of these ISDS clauses specify judgments to take place in ad-hoc arbitration, rather than a court?

(Also interesting: ISDS is usually a one-way procedure - governments can't take foreign companies to arbitration via them.)

36:

Charlie, do you in the Isles have the phenomenon of "homeowners' associations" assuming various powers of government by dint of clauses attached to purchase contracts? Very common here in the States. TTIP seems like the same thing writ large... the use of commercial law to trump political authority.

All symptoms of the ongoing Corporate Singularity, IMHO. While we've been wringing our hands about what might happen when computers become equipotent to people, we've happily ceded to commercial "legal persons" the privileges and powers of actual humans... meanwhile empowering them with unfettered use of their accumulated wealth to suborn democratic processes. And, surprise!, it turns out their values and priorities aren't automatically aligned with ours.

One might hope that decades of dystopian SF would have sensitized us to the perils of unchallenged corporate power, but alas it seems only to have made recent events appear inevitable.

37:

Either Syriza wins, or popular democracy continues to splinter under the pressure of externally imposed austerity. To caricature electoral politics in Greece over the last few years as feeding political parties into the ECB/Eurogroup woodchipper in the hopes one of them jams it isn't correct, but...
(There's always an alternative: to give up, shrug, say "it doesn't matter anyway, the [people in distant power] will do what they want anyway" and stay home. I shall now gesture vaguely towards the non-voting figure in the last UK general election.)

38:

There would be no such word as conspiracy were it not a thing. It is either naivety or ostrich-making denial to believe that people in power would not conspire to protect their own interests. It would be the most natural and inevitable conclusion that they do so, common sense in their situation.
Charlie is not paranoid, and is simultaneously not paranoid enough. But we all know that paranoid is not the appropriate term for being more acutely concerned and aware, when they really are out to get you.
TTIP is a treaty. It has been planned. It has been discussed in secret. What is a conspiracy if not secret agreement upon a plan that will benefit ourselves to the detriment of others?
The neoliberal free market project was no accident that just happened to benefit the rich at the expense of the workers.

39:

"Is this another (and big) step in ensuring that democracy can't actually threaten the interests of the global financial sector?"

No.

We're almost in tinfoil hat territory. Not quite, because there are some serious issues involving investor-state arbitration, but almost.

I don't expect what I'm about to write to shut down this discussion, but it should.

Arbitration clauses have been standard in bilateral investment treaties for over three decades. You can read the U.K. clause with China here. Article 7 is the relevant clause.

There is nothing new here.

Arbitral decisions are enforceable in national courts against commercial assets of the defending state. So if, for example, Australia loses the cigarette-packaging decision, the government will have a chance to appeal against it when the companies try to collect. The D.C. circuit court in the United States has a fairly liberal view; it's hard to imagine an (unlikely) adverse decision being enforced in the United States.

There are reasons to think that arbitration clauses are a bad idea. They were really designed with the 1938 Mexican oil expropriation in mind. (The recent Argentine action against Repsol is a modern example.) They have gone spectacularly wrong when applied outside the natural resource sector.

Argentina provides a good example, but not in the debt cases that you've heard about ... those cases have nothing to do with investor-state arbitration. Rather, arbitration has gone wrong in cases concerned foreign-owned utilities, where arbiters held that Argentine price controls in the wake of the economic collapse were tantamount to expropriation.

That was a stupid finding. Had California been a country, Enron could have sued it on the same grounds.

But in that case, Argentina only paid up when the Obama administration weighed in, applied mild trade sanctions and threatened to deny all future multilateral credits. It ended as a case of old-fashioned empire, not "Empire" in the Hardt and Negri sense.

The United States has generally written in a host of asymmetric exceptions, where American investors can sue foreign governments but not the reverse. That may or-may-not apply to TTIP. But even if it doesn't, foreigners are unlikely to sue. Consider, for example, NAFTA. Chapter 11 of NAFTA lays out some very strong investment protections. Other parts of NAFTA ban restrictions on the repatriation of profits.

In other words, NAFTA overturned the Community Reinvestment Act.

But no American court was going to throw out the Community Reinvestment Act. NAFTA, note, was not a treaty; it was written into domestic American law. (TTIP will be the same.) So no foreign bank bothered to sue, even though Mexican and Canadian investors stood to make a lot of money had they succeeded.

So, to summarize:

(1) Arbitration clauses are not new;
(2) Arbitral decisions are enforced in national (albeit foreign) courts;
(3) Decisions are hard to enforce against big countries.

therefore

(4) There is nothing to see here. Well, there is ... but it is nothing new and it is not going to lead to some sort of strange Greek-like situation. In Greece, the ECB could (and did) threaten to shut down the banking system. There is no ECB-equivalent for the TTIP.

so

(5) No, your paranoia is not reasonable.

If anything is unclear, I am happy to clarify. I wrote a book about this stuff.

40:

Punishment clauses? I've never seen that.

But what is true is that existing cases are not invalidated. Thus, Venezuelan and Ecuadorean time bombs continue to explode, even though both countries have pulled out of ICSID.

41:

Any real fix for global warming involves a different economy, with different winners. The incumbents really intensely don't want that

Correct, but it's already over as far as Big Coal are concerned -- they're walking dead. (Cost per kWh of solar PV cells is dropping to converge with and then undercut coal within the next couple of years.) If Elon Musk and imitators get the widespread roll-out of battery powered ground transportation sorted, then a lot of our current grid-powering base load plant becomes obsolescent because we've got a whole bunch of variable-output PV and wind micro-generators feeding into a whole bunch of self-propelled storage batteries on wheels. Add self-driving, and the auto industry itself expects demand for vehicles to drop 80%. Add fully automated freight shipping with wind powered aerofoils, able to take advantage of real time weather satellite data to optimize their routing, and things begin to get quite interesting in terms of keeping the lights on and the factories running for a global support framework, whether it's managed via Capitalism 1.0 or something else.

42:

The idea of a democracy where most adults can vote is very recent.

The idea that small groups of people enter into agreements which bind whole populations who do not even know about the agreements is ancient.

Paying heed to a universal suffrage electorate is a recent experiment. And it looks like the experiment has come to an end.

43:

Sorry, misremembered: not punishment clauses, but persistence of protection for a time after pulling out of the treaty (thus making pulling out of the treaty because of the existence of the protection a little less of a straightforward argument).

And to wildly oversimplify and caricature your previous comment: bilateral ISDS exists because (in part) WTO decisions can be insufficiently imperial?

44:

It's only a conspiracy when the others are doing it. Otherwise it's called diligent planing and smooth implementation.

45:

It's only a conspiracy when the others are doing it. Otherwise it's called diligent planing and smooth implementation.

As in "the diligent planning and smooth implementation of a dystopian nightmare"?

Diligent planning and smooth implementation are ethically neutral but Jack the Ripper was presumably a proponent of both.

46:

It occurs to me that lawyers are preferable to soldiers, in many ways. This isn't to spite the honor of honorable soldiers, it's simply that one has to ask whether it isn't more civilized to settle disputes in a heated arbitration, rather than on the battlefield?

Isn't this missing the point?

At present, the national state represents, in principle, the will of its citizens; its laws made by elected parliamentarians, are the highest authority in disputes among .. legal entities within its borders.

Agreements, like the TTIP, supersede the authority of that law with clauses in contracts that cannot be changed at anytime by elected representatives of a national state nor are they mediated by institutions, like courts, that are open to the citizens.

So, while all citizens are subjected to the clauses of those agreements, and the arbitrations of the somehow by someone appointed experts, they have no approved way [by court, for example] to directly take action against both.

This isn't an alternative between law [made by and for citizens] and war [conducted by citizens], it's neither.

The TTIP places corporate entities in authority over citizens and their elected representatives alike. In a way, the citizens become even less than a subject.

47:

First time I've ever visited the site below, and not sure how well-researched their analyses typically are. Even so, quite a bit of what they mention in this piece is consistent with what I've read in other well-known/reputable sources.

Basically, this is a summary of what happens in situations similar to that described by OGH. And, there's a bit about TIPP.


http://www.dailykos.com/story/2015/02/11/1361760/-When-Corporations-Sue-Countries-For-Profit#

48:

Correct, but it's already over as far as Big Coal are concerned -- they're walking dead. (Cost per kWh of solar PV cells is dropping to converge with and then undercut coal within the next couple of years.)

If and only if economically rational decisions are made.

That's not what's happening, or at least not so far as I can tell. And the "guarantee my profits/rents" outlook of the Owners isn't conducive to ceasing to be an Owner, which is what looks like has to happen. (E.g., otherwise the oil companies would have invested heavily in renewables and transitioned as fast as they could. Instead we get Fruitbat Fundamentalists as CEOs and insisting there's no such thing as climate change.)

Absolutely no question we could do it, from here, as a matter of technical capability. It gets a lot more questionable if we have to do it with broken or doubtful agriculture. And we don't know if we're going to avoid that.

49:

no question we could do it, from here, as a matter of technical capability.

Actually, the scalability of renewable power is still very much in question. It mainly hinges on how significant hidden subsidies from the conventional energy economy are, how fast diminishing returns will set in, and how to deal with energy-intensive manufacturing processes like smelting.

50:

Read "The Shock Doctrine" by Naiomi Klein- which is starting to look less like liberal conspiracy theory and more like future history.

The core problem with the neoliberal agenda (cutting spending on the not-rich and taxes on the rich) is that it is widely unpopular. On the margins people might be OK with it- so long as you're cutting other people's social security or other people's school funding. But when the time comes to cut their social security or their school funding, then it's not so popular.

Getting the proles to fight among themselves works for a while, until the proles figure out you, not the other proles, are the problem. At which point, stronger means are necessary to drive the policy forward.

Obviously, democracy has to go. Otherwise, sooner or later, the people will vote in politicians that will do what they want. But it's more than that. Not only do you have to undermine and eliminate (or make powerless) current democratic institutions, you have to prevent new ones from emerging. And that generally implies wide spread violence and terror. People won't organize because they're afraid to.

If you don't, then sooner or later the democratic backlash will undo all the neoliberal reforms you've installed. It's inevitable. If Syriza won't do it, the Greek people will kick them out and elect someone else. Repeat until someone does- or until the power of democratically elected government in Greece is removed.

51:

Argentina had a choice when it issued the bonds that are now in dispute, It could have inserted a perfectly standard collective action clause requiring all bondholders to accept any alteration in the terms that was agreed by a majority. It chose not to do so, and it was a free choice. The bondholders paid a bit more for the bonds (or accepted a lower interest rate, which is the same thing) precisely because they couldn't be forced to accept a deal they didn't personally like just because some other bondholders had accepted it. So Argentina has no standing at all, either legal or moral, to try to force those bondholders to accept a deal that they explicitly did not sign up to. If you want a collective action clause in your bonds, put it in from the beginning and accept a lower price for them; don't try to make one up when it turns out later that you need one.

52:

Nothing like paranoid enough. The intent is to sell the UK down the river (original meaning intended) to the mainly USA military industrial multinationals, * in such a way that we cannot escape by any 'democratic' means *. And using a full-blown revolution to do that would give 'them' the excuse to send the enforcers in. The TTIP aspect is the section included between asterisks.

53:

Charlie,

One note specific to the US: I think part, at least, of the militarization of the cops here is the insane success of the NRA in killing even most of the weakest gun ownership and carry laws.

But then, I figure the NRA's wet dream is everyone in the US carrying guns... (or at least until someone who loses family to a gun-toter who would have been denied a gun under a law they got struck down goes postal in the NRA headquarters....)

mark "Dodge City had stronger gun laws"

54:

So Argentina has no standing at all, either legal or moral

Bzzzt, WRONG!

The destruction of the lives of millions of people is absolutely a moral weight that trumps any other claim, particularly since this is over an artificial oversight in a foreign economic hegemony designed to plunder wealth from said millions in favor of the ruling elites of the hegemony.

This is a single billionaire trying to crush millions of people because despite his having billions already he wants more. That this has any legal significance at all is evidence of endemic corruption of the legal regime. That you think it is moral is pretty much the perfect picture of a debased soul. Reconsider the life choices that brought you to holding your incredibly warped worldview.

55:

Your point makes sense if we accept your premise that Argentina's obligations under the bond indentures are the only morally relevant concern. A person who considers the welfare of the Argentine people and/or the sovereignty of the Argentine nation to be compelling moral concerns will come to a different conclusion, probably involving complete default on the bonds. I can respect an attempt to balance the concerns, which seems to be what the Argentine government is trying to do.

56:

No, his point doesn't even make sense then because he is claiming it was a "free choice" for the Argentine people that generated that obligation.

It wasn't. It was not a universally agreed upon referendum to do this. Each individual did not examine the terms, consult with lawyers, and agree to this. It was a decision made by a past government, now people who had zero say in the matter.

It was a forced choice, made by a past government, the result of choices made by an overthrown government that saw mass protests to evict, that is destroying the lives of 42 million people. All so a rich guy in another country can get richer.

There is nothing remotely moral about this

57:

Then of course this leads to interesting questions re. what money is, where it comes from and why we need it. As far as I can see, we now need large scale debt free money creation in many countries simply to stave off mass poverty and loss of social cohesion. That this will negatively affect the rich folk/ international bodies who lend money is of course a given, but the simple fact is that cutting everything doesn't lead to economic growth, and people are more important than profit.

58:

Of course ideally the elits of various countries wouldn't use the countries to enrich themselves and their friends, and ideally governments would borrow and spend wisely, but I think that always acting as if they do or will is a bit silly.

59:

generics threaten the profits of the US pharmaceutical industry

A small but important detail. Much of what people think of as the US pharmaceutical industry is really the EU pharmaceutical industry due to mergers and acquisitions. Mostly UK and Swiss I think.

60:

So Argentina has no standing at all, either legal or moral, to try to force those bondholders to accept a deal that they explicitly did not sign up to.

If the time ever comes that you need to declare bankruptcy, I hope you remember that you have no moral standing to do so.

You must lose your house and your car, and live on the street until either you manage to pay off your debts which accumulate at 1.2% per month, or until you die.

Any other action on your part would be immoral.

61:

Charlie, do you in the Isles have the phenomenon of "homeowners' associations" assuming various powers of government by dint of clauses attached to purchase contracts?

If you're referring to those in the US they are not quite the same thing. Unless you're an idiot you typically have a lawyer representing you when you buy a house and they tell you about all such things before you buy. And even with a sales contract you typically have 30 days to unearth any nonsense in such things and then back out. Which is the key point. You are making the decision to buy a house with an HOA. The decision is not being make for you.

62:

As Noel said, arbitration clauses are not new and this is not just about the financial sector.

On this side of the planet, the Trans-Pacific Partnership negotiations fell over this weekend because of the political power of domestic sectors. The global financial sector barely got a word in edgewise.

Japan wants to export more cars but the US wants to protect jobs in US manufacturing. The littler countries want to protect existing access to cheap medicines but the US wants to protect pharma company IP. NZ has been pushing to get our dairy products into the US, Canada, and Japan. The US and Canadian farm lobbies have been successfully protecting their patches to keep us out; the Japanese have politely said "hell no" to reducing their protection of their own farmers. I suppose they can still remember starving in 1945.

And NZ has very little to offer to giants, given that we dropped our trade barriers in the 1980s.

So while there's a convincing narrative about global financial entites pre-empting democracy, the reality is that democracy is working just as it always has - domestic pressure groups are organising to get what they want. The failure of democracy accountability has its basis at a national level, not an international level.

63:

The dailykos certainly has a certain point of view. I've not seen them lying but they definitely make their arguments by selection of the facts they do use.

64:

The trick is that pretty much every developed country has a huge Boomer demographic retiring about now, and the debts are mainly held by pension funds. In other words, to cancel or inflate away the debts would simultaneously cancel or inflate away the Boomers' retirement savings.

65:

the Japanese have politely said "hell no" to reducing their protection of their own farmers. I suppose they can still remember starving in 1945.

AIUI Japan doesn't have a process (or doesn't use it) to redraw electoral districts. So they are basically the same as originally set up after WWII. Since then the population has shifted from rural to cities so small groups of farmers control the government processes way out of proportion to their share of the population.

66:

Oddly enough there was a feudal hangover in Scotland and elsewhere that wasn't wiped out until this century, whereby some specific obligation went with the property, but was often ignored or not noticed (Despite the use of legally trained folk in house sales), until in many cases some nasty person bought the right and started ransoming the current property owners.
Also in England there was one about having to contribute to the parish church upkeep or similar, but they finally scotched that recently, IIRC.

67:

I'll go with maximum paranoioa, and start with a rebuke to the legally-opinionated who claim that no Parliament binds its successors, and a country can simply withdraw from its treaties:

You are perfectly right to say so, within the confines of your courtroom, bar-room, bedroom or padded cell. Perhaps there are no consequences, and you are lord of all you survey.

You, and the Freemen on the land.

Treaties are binding contracts between nations - and any other entity that has comparable powers - and they are either expressions of dominion from the powerful and the great to the dominated lesser power; or mutual obligations between equals, entered into for mutual gain, or for mutual protection; and I say 'binding' because the contracting parties are bound by the threat - or the certainty - that there are negative consequences to one or both in any other course of action.

Consider the consequences of a country defaulting on its debts, and ask if defaulting on those bonds is a good example of a Parliament free of all binding by the actions of its predecessors.

The point of these new treaties is that they are a new kind of compact between *any* commercial or monetarily-competent entity trading with a sovereign state - not just lenders; and they have a new arsenal of powers, far greater than bondholders and vulture funds, who already use the courts of a friendly foreign power to enforce sanctions, sequestrations, locked accounts and asset seizures.

Further, the new treaties are a compact between *all* the commercial entities trading with a country - not just one vulture fund or one class of bondholders with a contract in default and a claim in court.

All the commercial parties have a framework to act in concert, they and their sponsor governments, to seize or sequester or skim whatever the 'arbitration' allows of the defaulting country's overseas assets and cross-border cashflows.

The country in the treaty has signed over a right for them to claim onshore assets, too; and that is binding, because unilaterally abrogating does not free them from the depredation of their offshore assets and trade flows.

In one sense, this is merely an extension of the existing case in which a sovereign default is declared when a state fails to pay out on any issued bond, or to any one particular creditor: of one debt is in default, all the state's debts are defaulted; and all the creditors negotiate between themselves a settlement that distributes the losses and pursues recovery - often without regard to terms and clauses of preference and 'seniority'.

But *what* an extension it is - TTIP and its sister treaties pre-position and orchestrate all the commercial parties in concert, in a position of far greater power than a vulture fund, in a court of their own design.


If that is enough paranioia, consider the maximum case: the Australian government has shown some spirit and some backbone, and stands up to the claimants, preferring its proper duties to the citizens; now imagine a spineless and corrupt cabinet of wealthy men in a declining power, negotiating in secret for their own interests instead of the greater good of their countrymen.

Such are the treaties we are to be bound by: and if we default on the terms - or are declared to have done so by a hostile party - we face the consequences of abrogation whether we were fairly represented by our governments or not.


68:

In the US you can typically recognize an HOA area as all the houses have the same style in almost everything to do with the exterior. And when you buy your house you also are agreeing to join the HOA and submit all exterior changes to the HOA for approval. And after a subdivision is built out the HOA is made up of the home owners. So you basically have to get your neighbors to agree to what you want to do.

This has led to some interesting disputes when you have things like an HOA rule that you must keep your lawn in green grass mowed so the grass is within a specified height range. Then when you get a drought with water restrictions you have some control freak HOAs telling people to ignore the law and water their lawns to keep them green. Usually makes the front page of the local paper. A friend who ran into this used sports lawn paint to paint his yard. HOA voted not to long after that to no allow painting of the grass to keep it green.

And in many cases you can get a homeowner who sues their HOA (typically a lawyer) when they go waaaay overboard.

What you are discussing in Scotland sound a lot like mineral rights that many in poor areas were sold off 150 years ago or more in the US. Nothing like having a drilling rig show up in your front yard and nothing you can do about it. Worse was having your property strip mined and the arguments about what shape it had to be put back in. Owners on mountains wanted it flat. Other groups wanted it back to what it was.

69:

Okay ... a few questions:

How much of this (issue) is due to this agreement looking as though it's been drafted by USian corporate lawyers, therefore subject to/in accordance with the USian legal system?

Whose authority/legal system would have more fairness built in? What are/would be the hallmarks of a 'fair/just' pact/agreement? (Below is a link to the United Nations Declaration of Human Rights ... the most 'universally' accepted set of rights that I'm aware of.)

http://www.un.org/en/documents/udhr/

70:

Japan has a process for redrawing electoral boundaries, it's just ad hoc, occasional, and driven in practice by the Supreme Court arguing with the government of the day (https://en.wikipedia.org/wiki/Elections_in_Japan#Malapportionment).

And this is the kind of thing that drives or hinders trade agreements.

71:

Can I suggest looking at it through a different pair of glasses?

Governments, of all sizes, are becoming less relevant. Sure they still strut their stuff like they are important - but how many really want ANY of them in charge? They just aren't competent and reflective of the people they are supposed to represent. Realistically they have no real mandate, are a joke, and in particular they have no trust.

You could say this doesn't matter, they still have the bullyboys of the courts, police and army to enforce their will - but I'd say that that last just so long as they don't try anything on too far. Then they are a red smear on the pavement.

Greece is something of a test case in how hard you can push a populous before it breaks - people are using it for calibration (it might even be the reason they are being so obviously stupid).

The governments are also trying an information power grab, in the hope that they can 'out intelligence' anyone organising; but anyone looking a strategy knows that can be defeated relatively easily.

Companies are trying to take a legal power grab to support their own positions, using corruption of the politicians to push policies that advantage them. They have done quite well, nobody seriously thinks the politicians call the shots any more.

However, when, not if, push comes to shove, it will be for naught and we'll have Ceaușescu all over again. The size of the problems coming over the horizon (climate change, energy, automation, water, etc.) are such that without trust from the electorate they WILL be strung up, and the bankers, and the big business types.

My worry is what pops up after that is rarely great. It's not the cream that floats to the top when the world goes to shit.

72:

Do not overestimate the intelligence and awareness of the oligarchs. You're generally talking about rich old men, most of whom have been wealthy and powerful from childhood. Consequently they have been surrounded by sycophants for years, rarely suffer consequences for their actions and don't have to take account of other people's feelings. So don't expect smart, rational behavior. Obama did a lot to get the economy back on an even keel and save Wall Street's bacon. In return, the big money on Wall Street turned sharply against Obama and the Democrats and bitterly resented anyone suggesting that Wall Street might have done something wrong. Hell, at the Koch beauty pageant for Republican presidential candidates, Ted "Machine Gun Bacon" Cruz was the most popular. Think about what that says about their judgment. The awful truth is our new overlords are much closer to Homer Simpson than Montgomery Burns.

Incidentally, don't pay attention to Bill Fleckenstein. He's a gold bug and inflation truther so I wouldn't trust anything he has to say about economics.

73:

YES
( Not paranoid enough )
When Tory MP's write in the Daily Telegraph that TTIP stinks, then you know that something is seriously WORNG

74:

See also Peurto Rico - a subsidiary but not a state of the USSA.
Totally shafted.
The Hedge funds are rubbing their hands at all those new spic slaves.
[ NOT racism, btw - that's how the H-F bosses will view it, the bastards ]

75:

"Governments, of all sizes, are becoming less relevant. Sure they still strut their stuff like they are important..."

Important enough to employ men with guns to enforce the laws they pass. That is the non-abstract layer of govt that you will personally encounter if you say "No" too many times.

76:

I haven't heard of anything quite like a US home owners' association existing in the UK.

In general, homes in the UK (note: different legal regime in Scotland) are sold as freehold title -- you own the land and everything on it in perpetuity -- or leasehold; someone else owns the freehold (usually an investment vehicle), builds homes on it, and leases them for 99 or 999 years. The latter are typically flats, and the freehold is usually owned by a management company which charges a monthly maintenance fee which is spent on repairs/maintenance of the collective structure. Sensibly organized ones are constituted so that all the leaseholders are shareholders and the management co basically does what they want -- so any rent increases are agreed by the residents and allocated to specific tasks (for example, repairing an elderly roof that covers everyone).

(Headaches occur when the land is owned by a third party and the remaining time on the leasehold decrements to less than about 50 years, because if you buy such a property you're buying a depreciating asset. But on the other hand, it's often possible for the residents to collectively buy out the land.)

Scotland of course is different and when I say I own my top floor tenement flat, I mean I own the freehold on it -- and the empty air it stands on. Some buildings end up setting up a stairwell association or even a limited company to pool monthly payments from the residents and take care of maintenance; others do it on an ad-hoc basis. (Which makes the negotiations around roof repairs ... interesting.)

But dictatorial home owners associations imposing weird terms and conditions on what color you can paint your window frames? Nope, we don't have them: around here that's the Town Council planning department's job. (Hollow laughter.)

77:

There is a glaringly obvious solution to the first order problem of the economy being over-financialized: we need to abolish retirement.

The easiest way to do this would be to find a cure for old age. (The crude totalitarian cure: a bullet to the back of the head. The more desirable version: a pill that resets your ageing processes. I reckon quite a lot of folks would be willing to trade a prolonged retirement for being physically 20 again ...)

Of course, that'd then raise a second order problem, namely how to deal with the demographic overhang past the planet's carrying capacity lasting for multiple centuries rather than just one or two. But hey, that's tomorrow's problem.

Why can't real life work like an SF novel?

78:
...how to deal with energy-intensive manufacturing processes like smelting.
Iceland has made it to 11th in the world in aluminium production (extremely energy intensive) on the back of hydro dams; it's doable. Places with lots of dependable renewable energy could export it as aluminium, steel, or other embodied-electrity dense commodities.
79:

But dictatorial home owners associations imposing weird terms and conditions on what color you can paint your window frames? Nope, we don't have them

You do Charlie, but mainly in the newer estates of crammed together shoeboxes. In the UK they tend to be a symptom of over zealous 'designers', who can't bear the thought of someone painting over their particular shade of hideous pink that forms what they feel is the 'design essence' of the estate - so it gets written into the terms.

HOA as loathed in the US (estates run by busybodies) are more unusual, but they do occur.

80:

The main thrust so far--and here I'm talking to the Trans-Pacific Partnership (TPP)--is the granting of rights to corporations against electorates who enact legislation contrary to their financial interest. So in Australia the successful use of plain packaging laws for cigarettes, which has been so effective that it has indeed hurt tobacco company profits substantially, would, under the TPP, leave the Australian federal government liable for BAT's loss of profits.

There's a bunch of stuff about IP too, mostly bad. For us there's no reading that doesn't make it look like a bad deal, hence I suppose the secrecy. Strangely our Feds have actually rejected the first round, but it's not clear that this isn't just going to overwhelm us.

81:

...when I say I own my top floor tenement flat, I mean I own the freehold on it -- and the empty air it stands on.

Do you call that "strata title"? That's what that is called here. But then you only own that empty air so long as it's practical to live there... if the building is removed, you no longer own it. Then if another takes it's place...

82:

But dictatorial home owners associations imposing weird terms and conditions on what color you can paint your window frames? Nope, we don't have them: around here that's the Town Council planning department's job.

Well, if you will live in a Grade 1 Listed Building... ;-)

83:

" I reckon quite a lot of folks would be willing to trade a prolonged retirement for being physically 20 again ..."

I would sell my house tomorrow and start from zero if I had that opportunity. Youth is wasted on the young...

84:

That just raises equality issues around the availability of the "20 again" pill. The equitable solution is that everyone does in fact retire at 150, or at some actuarial timeframe that balances the population dynamics (assuming the pill doesn't just keep going forever).

In practice in the post-capitalist world we live in, the 1% get the pill anyway no matter what they wasted their lives doing so far, while an increasingly competitive meritocracy for everyone else breaks down into overt nepotism within a generation. Sure the generation might be longer than what we're used to, but the excluded experience 3-4 generations while it happens. Actually the first book in Richard Morgan's best known trilogy comes to mind. I'm not sure I see expensive technology for virtual immortality doing anything but entrenching inequality, and stunting humanity like a bonsai.

85:

those with direct influence on these agreements (government politicians, civil servants)

Well, in this particular paranoid speculation scenario, the politicians really are quite secondary; real power resides elsewhere. The politicians are just a conduit and a distraction.

86:

Youth is wasted on the young

Quite so.

Consider the scenario where each pill resets your age to 20, but cost 25x the median house price in the most fashionable city in your country. Or some other technically achievable but challenging multiple. I imagine financial instruments for the purpose coming into existence, but would these be readily available?

Even if virtual immortality were possible on those terms, and in fact the physical resource requirements to make it possible were trivial, wouldn't our culture grant IP rights to the technology providers who merely get there first, to the extent that few could benefit in the short term?

87:

It occurs to me that lawyers are preferable to soldiers, in many ways. This isn't to spite the honor of honorable soldiers, it's simply that one has to ask whether it isn't more civilized to settle disputes in a heated arbitration, rather than on the battlefield?

Didn't armies used to be very professional and mercenary? To the point where it was really expensive to go to war? Maybe lawyers will become de-professionalized, and suing people will be as easy as corporate conscription! ;D

88:

Well, if you will live in a Grade 1 Listed Building... ;-)

It's not just a Grade 1 Listed Building, it's a Grade 1 Listed city. About 10% of all the property in Edinburgh -- basically the entire Old Town and the New Town -- has Listed Building status. Because UNESCO World Heritage Site.

There are upsides and downsides to this. Upside: gorgeous built environment to live in. Downside: satellite dishes are verboten so we're stuck with a Virgin monopoly on cable TV (at least until we can get an adequate TVoIP substitute). Parking is insane -- single car garages pass hands for £40,000-60,000, which is central London grade stupid -- due to scarcity (you'll find it really hard to get planning permission to build a new one). And we're not allowed to fit double glazing or other insulation/modernization features that alter the external appearance.

Luckily we got indoor plumbing and electricity before the World Heritage Status otherwise we'd be shitting in a bucket and shouting "gardey loo!" out the window, like in the old days.

89:

For the best fictional analysis of this I can remember in quite some time, I'd like to refer you to Joe Haldeman's "The Long Habit of Living" (pub 1990, out of print, no ebook available, dammit).

A reset-your-body-to-20 treatment is developed. The evil monopolist corporation sells it for: $1M or your entire assets, whichever sum is greater. It lasts for 10 years, then your body rapidly falls apart unless you can pay for another shot -- meaning, you have to accumulate $1M of capital, minimum, every decade, starting from nothing, or you die.

Interesting sociopolitical consequences ensue.

90:

Yes, that premise never made financial sense to me. What does Evil Monopolist Corporation DO with all the wealth it acquires this way? Unless the treatment is based on unicorn farts and osmium suppositories it's not going to consume a fraction of the income it engenders and research into a cheaper and more widely available treatment isn't to their long-term advantage as long as the current situation is maintained, which it must have for the 10-years-to-fall-apart cycle to be well known and established in the local culture.

The story's age is also rather obvious in that the minimum fee is only $1 million -- cue Dr.-Evil-and-pinky GIF here.

91:

They're also in theory the negotiators' bosses, so they'll still have influence. (I was careful not to say 'power' or 'control' in my original.)

92:

The last time you mentioned this book, I got a nice hardback version online for a dollar (plus postage/shipping) was definitely worth a read

93:

There does indeed appear to be an Amazon Kindle edition. This probably beats the Henning Mankel thing I was going to read next.

94:

So the argument would have to lead into how the IP is protected and how the means of production are kept from the servile masses, who at some later time arise, arise.

95:

Joe Haldeman's "The Long Habit of Living" (pub 1990, out of print, no ebook available, dammit).

US title is Buying Time.

96:

>Yes, that premise never made financial sense to me. What does Evil Monopolist Corporation DO with all the wealth it acquires this way?

Fundamentally? Enslave everyone who takes the pill. Money is merely the ability to get someone to do something they don't want to, namely a "job". If all the money passes through your hands, you control the actions of everyone on the planet. If everyone in the world pays you all the money they have and then needs to earn $1million in a fixed time span, they need to convince you to give them some of it back: they can't get it from anyone else, because everyone gave it to you!

>The story's age is also rather obvious in that the minimum fee is only $1 million.

At the point you control everything, numerals are just a method of keeping score. It would probably be better to say that the currency is now Pills, with a conversion rate of $1million => 1 Pill. The "everything you own" clause is to ensure the destruction of the old economic system in favor of yours is absolute.

Of course, the natural response to such a declaration is war. Civil war, global war, basically every kind of war all at once. If youth is worth giving up everything you've earned, then it's worth risking your life for, and certainly worth risking some other schlub's life.

(To note: I haven't actually read the book, this is just theorising upon the premise.)

97:

Do not overestimate the intelligence and awareness of the oligarchs.

Do not forget that oligarchs are collective entities, with lean and hungry staff who gain status and security through making the oligarch money. (And who may dream of being Mayors of the Palace.)

98:

Thanks, Noel - you said half of what I was going to say, and said it much better and with more authority.

The other half of what I was going to say is this: as treaty negotiations go, TTIP is one of the least secretive, most open processes I have ever seen. The "extremes measure taken to prevent leaks" include the European Commission publishing its negotiating texts, and the US Trade Representative likewise publish round by round reports of what has been discussed. The negotiators are regularly held to account by their respective parliamentary processes and speak on TTIP frequently in public Q&As. Of course we don't get to see everything that's being discussed; no diplomatic negotiation in history has taken place under the impossible standards that some TTIP opponents portray as the norm.

I'll add that the characterisation of the ISDS system that I read from a lot of anti-TTIP sites is so distorted that that it's positively mendacious; and anyway ISDS as such will not be the system that goes into TTIP, if any such system is used at all. Here is a video of the relevant European Commissioner, Cecilia Malmström, from two days ago answering a journalist's question about this. She says:

"we are making a totally new reform of dispute settlement moving away from the ISDS system. I presented a paper in May on this. We are now working on the legal text which is being internally processed. That will then be the EU proposal on how to deal with this, moving away from private courts and towards preselected judges or equivalents; having more transparency; having a system of appeal. This would be reflected in TTIP and subsequent agreements. A further aim is to have a bilateral court but this will take some time."

So when you ask about the "secretive binding arbitration provisions in TTIP", the problem with answering is that the process isn't very secret and the provisions have not been written yet, so are hardly binding. Of course we must be vigilant, and push for decent treaties which deal with everyone decently. But to answer your last question, in this case at least you are being too paranoid because you have been fed misinformation by people who ought to know better (and in some cases do).

99:

I haven't read the novel either. But...
(thinking aloud)
One thing that might need to be taken into account is the cost of producing the treatment. You can assume that the Company is Evil™ and if there's nearly no production cost whatever they charge is pure profit. But if costs are half a million to produce one treatment then you're only profiting enough to make the next treatment, that doesn't make sense, so presumably it would be cheaper to make. And you can turn that around if the company is trying to be benevolent (yeah right)... and so on.

It's been a while since I've read Sterling's "Holy Fire", so I don't remember how he handled it.

100:

What, no black or grey markets? No knock-offs? Doesn't sound realistic. The manufacturing process would probably not go through the regular channels (patent) because that would mean handing over the goose within two market purchase cycles.

I assume that this technique would be based on artificially increasing the telomere lengths on one's stem cells?

Ha! The spellchecker here didn't recognize telomere, so I did the Google search just in case ... and look what it turned up, right at the top of the search results page. (Doesn't look like a big pharma ad ... more like snake oil.)


http://www.primalforce.net/catalog/products/TeloEssence.html?gclid=CMb5nYjblMcCFQYvaQodT1gDQA

Excerpt:

Telo-Essence

Dr. Sears' Newest Telomere Support Formula
Extend the Power of Youth
by “Flipping a Switch” in Your Cells
Nobel-Prize Winning Breakthrough Lets You Combine the
Energy of Youth with the Wisdom, Experience, and Financial
Resources of Your “Golden Years”

I have been working for years on one of the most exciting medical breakthroughs of our time – the secret of the telomere.

I’ve already shared this pioneering secret with hundreds of patients at my wellness clinic. And the effect had been literally life-changing.'


And, what Wikipedia shows on the 'medical board' that this guy provides as his bona fides:

'However, the field of anti-aging medicine is not recognized by established medical organizations, such as the American Board of Medical Specialties and the American Medical Association (AMA). In addition to certifying practitioners, the Academy's activities include lobbying, education of the public, and public relations. The A4M was founded in 1993 by Dr. Robert Goldman[disambiguation needed] and Dr. Ronald Klatz, osteopathic physicians,[2] and now has grown to 26,000 members from 110 countries. The organization sponsors several conferences, such as the Annual World Congress on Anti-Aging Medicine.[3]'


101:

Not sure that's entirely true in the UK. In England at least, covenants may be written into the deeds of the property, by the owner. The ones I've seen have ranged from "you may not park a caravan or commercial vehicle on your drive or on the road" to "you may not alter the external appearance of the property in any way". Not actually seen any relating to private or unadopted roads.

From a couple of liquid fuelled conversations with retired solicitors, you can probably safely ignore any covenants attached to residential property in England. The reason being that they can only be enforced by law, which rapidly gets expensive, and a complainant would have to know the covenants exist in the first place. You can get covenants removed by the courts, but the cheapest way is to just go ahead, do your thing and see if any challenge turns up. If nothing happens, the covenant is voided, basically. You should always be nice to your neighbours though, just in case. And keep notes.

For private or unadopted roads and sewage systems, things are different. The covenant may impose a burden in exchange for a benefit. Not a lot can done about it then save getting the thing adopted by the local council or the relevant firm. Which means it has to be in pretty good condition for them to agree.

With regard to the precious developers, most of the ones I've heard of have ended up in court once the first set of maintenance needs doing (ie. about 10-15 years after the build) and been removed. Could be interesting in a few years time for a couple of gated eco-villages in the West Country, if memory serves.

102:

Chancel Repairs. First knew about this only a few years ago when looking into buying a house and it showed up in the deeds. It isn't really general upkeep, but very specific repairs. Which by their nature are not cheap, and the only thing you can do is insure against it arising. IIRC, the insurance was quite cheap, but had quite a large excess, and the payout was capped at a level which would most likely not necessarily cover the entire cost.

I suppose that you could always join the congregation and start praying instead.

It's not actually been abolished. Having just looked it up, the Chancel Repairs Bill 2014 had it's first reading in the Lords in July last year. Nothing has happened since.

The liability is actually quite nasty. The Church, vicar or whoever only has to identify a single property owner with the liability, and they then become liable for the entire cost, and it's their responsibility to identify and recover any contributions from any other property owners who might be liable. The problem is that with the likely age of the church and the affected properties, the charge may not actually be recorded with the Land Registry. So good luck with that.

We didn't buy the house.

103:

ISDS is about investors not creditors. A problem that a number of poor historically badly run states have is that foreign investors don't trust the state sufficiently to be willing to invest. Primary extraction businesses don't have a lot of choice, you have to mine in places the ore happens to be. But any other business can simply base itself in a more politically reliable state. By signing up to ISDS the poorly governed state make a commitment not to do so. The EU single market depends on exactly this kind of thing. The courts can and have ruled actions by member states illegal.

Governments already have the power to sue businesses under domestic law, the treaty doesn't alter that. What it does is grant business the right to directly sue governments. The WTO arrangements only allowed states to bring actions on an investor's behalf.

The IMF and other such bodies have influence only on those states that need to borrow from them. The UK for example can borrow extremely cheaply on the bond market so isn't affected.

Treaties are always negotiated in confidence, the terms will be published before ratification.

104:

What, no black or grey markets? No knock-offs? Doesn't sound realistic.

Yes, it sounds unrealistic to me too. Likewise those dystopian scenarios where corporations invent robots that do everything, including make more robots, and subsequently own everything forever because of copyrights on the software or whatever. It's like the people worrying about those scenarios believe that every country is a stub of the USA and all of their politicians want to curry favor with American corporations instead of local movers and shakers.

105:

On the topic of the OP, Crooked Timber is documenting the ways the conservatives are basically dismantling British democracy

http://crookedtimber.org/2015/08/06/britains-new-government-2/

106:

> prevent an assertion of people power

Maybe the time has come again to use some harbour somewhere as a TeaTIP.
A bit more difficult these days with big canoes carrying 18.000 containers. What the hell, toss the lot in the harbor.

About paranoia.
More paranoia is better in this case. The critters in control have money as religion and anything that's in the way must go.
Connected to this I found it interesting to notice that the media ( in Holland ) went over the top about the whole Greece thing and the associated cost of keeping them in the eurozone. I haven't seen ONE message in the mainstream media about the conclusion of Stanford university researchers that the 6th mass extinction event in the history of this planet has begun. That worries me slightly more than Greeks that can't buy a Happy Meal or that necessary 15th pair of shoes.

107:

That worries me slightly more than Greeks that can't buy a Happy Meal or that necessary 15th pair of shoes.

I suggest you check your Northern European privilege then, because it's not so much about doing without a 15th pair of shoes as about people in Greek hospitals dying in pain because the pharmacies can't buy imported chemotherapy agents or even painkillers and antibiotics.

Seriously, folks. The Greek situation is not trivial, it's Great Depression circa 1933 bad over there. A handful of well-off folks are doing just fine, but for ordinary folks it's a case of the structure of civil society disintegrating around them. Possibly the only thing preventing a military coup is that the ignoble end of the last one is still within living memory of the officers who'd be running it.

108:

@39:
California been a country,
---
Er, California IS a country. Just like England is a country. California voluntarily agreed to some restrictions when it joined up with the United States, just like England/Britain/UK did when they joined the EU.

California has its own legislature, its own chief executive, its own military, collects its own taxes, and has its own legal system and courts. By treaty, they leave foreign policy to the Feral government, and use their monetary system, weights and measures, etc.

109:

Note to commenters: If you want to know who to listen to about TTIP, I'd say "listen to Noel Maurer and Nicholas Whyte. One's an associate professor of international affairs at GWU, the other is a former diplomat and director of an international business consultancy. In other words, it's their job to know about this stuff (the way it's my job to know what goes into publishing an SF novel).

110:

Possibly the only thing preventing a military coup is that the ignoble end of the last one is still within living memory of the officers who'd be running it.

Why would the military (or anyone) want to run that country at the current state of affairs? You'd have to be mad or an idealist.

111:

It's bad for sure. It's back to basics for those folks.
That reminds me about my grandfather in late 1940's, before my time.
Had to be admitted to hospital and died there in a rather unpleasant way. No one ever found out what it was that did him in. That was of course before all modern technologies came about. And apparently the greek are in the process of losing those things.

Privileges?
I can relate to the Greeks in the sense that I haven't had enough income to rent a house for the last 5 years.
After my job became 'redundant' I found out the hard way the economy wasn't in good shape. Did buy a good pair of shoes 2 years ago though. 13 pairs to go before I hit 15 :)

112:

That does sound a bit like you are saying that your post was not to be taken seriously?

Perhaps the democratic deficit is at our end, in our elective dictatorships.

113:

The post was a question about a speculation. It looks to me that OGH accepts that TTIP & Co are not part of an evil conspiracy to overthrow democracy,

My own opinion is that no treaty or legislation will be able to stabilize capitalism in the near-to-mid future. The problem is that capitalism is good at growing but bad at steady state and even worse at shrinking. With resources running out, population growth receding and no new markets (like China was) to develop in sight, it's time to shrink. And that means that politics will have to decide either to feed the people or to guarantee shareholder yields.

114:

I don't think this is correct.

The coal companies are in big trouble right now. They are in trouble in the same way that oil was running out in 2010. I don't want to discount what has happened with renewables over these past few years. Developed countries and China are moving away from coal (unevenly), which is destroying demand.

However, this doesn't take into account growth in South Asia, Africa, and parts of Southeast Asia. Right now, none of those economies are growing fast enough to compensate for the decline occurring. However, as long as those countries represent a potential source of cheap labor with low environmental enforcement, their economies will grow eventually. This is especially true as China is cracking down on pollution and labor exploitation, at least what Beijing considers that. If we're lucky, these new economies will simply replace the coal demand of the present developed world.

I know that renewables have made tons of progress, but we don't know if they are applicable to an economy similar to that of Bangladesh?

115:

Honest answer: the muppets are running around dividing the spoils / controls and panicking about the big picture. It's the cusp end of Pax Americana and the technocratic fix (see Quadriga, not even being funny, and host is 100% correct about Greek health services amongst other things).

It's the male version of proving your worth to the company and all that.

Problem is: future is female. And they're really not fucking happy.

Direct quotation: "...and we'll be finally free and it'll be time for some payback". This is coming from the [redacted] who have had to kow-tow to 'the entire world but the Artic and Africa' for some time now.

Hera and co: not so nice. Still.


Peanuts. (Yes, there's a third, straight rod, tale in there...)

116:

One of my friends is Greek. As he tells it, his part of Greece got nailed by the EU sanctions. Farmer couldn't sell to Russia, which was their market, and basically lost the entire crop. (Rotting in the fields because they couldn't find other markets). According to him, the feeling in his home region is that Greece got punished so Germans could feel that they were doing something about Russia. No idea how widespread this feeling is. I do remember that when the USSR was boycotted years ago, Canadian farmers felt they were punished (massive losses because of grain embargo) so the rest of the country could feel they were doing the right thing.

Wondering how much this affected the Greek vote on austerity -- the feeling that they were already paying for an EU policy.

117:

Very true. But the staff are still high priests that have to placate dimwitted and capricious gods with all the risks that entails. Imagine how depressing it must be for Scott Walker to still have to compete for the favor of the Koch brothers. And the staff regardless of intelligence specialize in sycophancy, not good management. And because their power depends on access to the boss they all have an incentive to sabotage any competent rivals. All of which leads to poor policy in practical terms. In contrast, a democratic leader depends on appeasing the masses which gives her an incentive to pursue the greater good. Thus pandering and petty greed can create a better world, but only if properly channeled.

118:

Yes. The situation is serious enough in the UK, where some people do not have enough money for such 'options' as nutritionally good food or books, but Greece is much worse.

The extinction event is worse still, true, but it has been in the better mainstream papers for many years now; the Stanford results are only the latest of many reliable ones. Admittedly, 'the better mainstream papers' no longer include any of the high- or even medium-circulation ones :-(

119:

"Do not overestimate the intelligence and awareness of the oligarchs."

As someone said about my organisation "Never underestimate the viciousness of the ." And that's what they do with the money in the Long Habit of Living - accumulate it so that they can deprive other people of it. That's P Power. The politicians are maintained so that they can change and enforce the laws to support the plutocratic organisations and oligarchs and, in extremis, send the troops in to suppress potential revolution. It's damn all to do with any other objective than power.

120:

" And that's what they do with the money in the Long Habit of Living - accumulate it so that they can deprive other people of it."

Not really. It's not as if it is all stuffed under their bed, depriving people of its use by removing it from the economy. Having a lot of money actually means control over how resources are used. It does not mean eliminating those resources. It means choosing priorities that are not necessarily in the best interests of the general population.

121:

Burn the church down?

122:

"crroked timber" link borked ...
Not sure why - will try main site & look for it.

123:

I can't even open the main-page for Crooked Timber - what's going on?

124:

Charlie
I mentioned it before ( # 74 )

Purto Rico is really in very deep shit - makes Greece look easy.
The Hedge-funds & shysters have their claws into that island & its population.
Because it is NOT a US state, they can "do an Argentina" only worse.
I recommend everyone to look at that as a horrible example of a TTIP future - or rather a re-creation of the "Deep South" of the USA or maybe Roman-Empire Latifundia

The direction some people want us to head in ....

125:

Can a nation state declare war on a company?

Dring dring.
Hello?
Hello. Is that the chief exec of Goldman Sachs London?
It is.
Hiya. This is Nicola.
Nicola?
Scotland. First minister. That Nicola. How you doing?
Er, good, thank you, I…
Anyway, sorry but we're a wee bit pushed for time here. I just wanted to tell you, personally like, that we've declared war on you. Ha! No you personally, no. I mean on Goldman Sachs.
Is this a joke?
No, it's no. It's proper. There's a formal declaration being biked over from our embassy in Brixton.
This is absurd.
No, we had our legal woman check it all out, international law and that, and we're pretty confident we can do this. I mean, the way you guys have been messing with the economy since independence has been rotten.
But…
I had a wee word with the prime minister down your way. Jeremy said he doesnae mind. I know you're in England but it's not like we're arriving with tanks or anything. We don't have any anyway. But Bob and Jamie from Police Scotland will be there promptly. They'll be taking you into custody as a prisoner of war.
But I…
Look. We're no going to pay you rent anymore. For just, you know, the privilege of living in our own place. So Bob and Jamie will be there soon. I'd be careful with Jamie though, he's a right greetin' faced bugger, especially since Rangers went bust again. Bye now.

126:

Can a nation...Rangers went bust again.

{LIKE}

127:

No - read The Winner Effect. They get their rocks off by their relative power, not by any absolute level or what they can do with it. Seriously.

128:

You can check websites via:

http://downforeveryoneorjustme.com/

You'll need to allow scripts to work. Site is safe and 100% trustworthy.


Crooked Timber is up, and there's no traffic issues on its hosts.

129:

Totally true.

The big story of the past 150 years, and one which forms a big picture that has barely been noticed by general historians, never mind economists or politicians, is female emancipation, education, and economic participation.

Go back to 1860 and, globally, there was virtually no place on Earth where women had civil rights on a par with what they have in Iran today; the general situation was illiteracy, reproductive slavery, zero property or political rights, and de facto ownership by older male relative or husband. On a micro scale there were individual rebellions (peanut gallery: go google on "petty treason" and punishments prescribed by law for it), and at the other end of the scale there were individual wealthy and powerful women (Catherine the Great, Elizabeth I of England), but in general the world was a shit place to be born female before the 20th century.

The 21st century is going to be very different, unless the neo-reactionaries/Dark Enlightenment and their non-western counterparts like Da'esh get their way.

130:

Favorite 'conspiracy moment' from the last 5 years:

No one recognised her or has seen her since. She had an other-worldy quality; I half expected her to be leading them to Charon's boat, or up a stairway formed of clouds...

The lady in white led her band of Bilderberg bigwigs and billionaires along the charming Swiss byways, across bridges over gentle streams ... and straight into a pack of 50 baffled activists, who were milling around outside a community hall during a break in a symposium.

http://www.theguardian.com/news/blog/2011/jun/12/bilderberg-2011-mandelson-nature-walk


The 21st century is going to be very different, unless the neo-reactionaries/Dark Enlightenment and their non-western counterparts like Da'esh get their way.

I'd imagine that's very doubtful. One can hope.

131:

Anyhow, things are moving around somewhat:

The chief economist of The Economist magazine, Simon Baptist, believes that the Trans-Pacific Partnership (TPP) trade deal is dead following the failure of final round negotiations in Hawaii last week. Here’s Baptist’s latest commentary on the TPP from his latest email newsletter:

...For now, the shape of international standards in these areas remains up for grabs. The next step for the TPP, if anything, is whether a smaller group—such as the founding four —will break away and go ahead on their own, with a much smaller share of global GDP involved, and in the hope that others will join later.

http://www.macrobusiness.com.au/2015/08/the-economist-the-tpp-is-dead/


Knowing who owns the Economist helps to work out where the money's looking.

132:

And (sorry for the skipping, realized that not all readers might have the recent stuff on it):

vWashington, DC — Knowledge Ecology International (KEI), a non-governmental organization that advocates for access to knowledge and access to affordable medicines through intellectual property reform, today, August 5, 2015, leaked the remaining sections of the May 11, 2015 version of the Intellectual Property Chapter for the Trans-Pacific Partnership (TPP) trade agreement. The negotiating text reflects the state of negotiations directly prior to the recent ministerial conference in Maui, Hawaii, which ended Friday, July 31, 2015.

http://keionline.org/node/2309


I used Australian sources because their IP / copyright law is (used to be?) the saner old Anglo version, and more than likely a #1 target for the TPP.

Strangely, not much noise out of Australia over that little oversight.


133:

I think that this s how I shall picture you from here on. It is a rather wonderful story.

134:

The usual thing is no matter what the noise in Australia, it just isn't much noticed elsewhere. I suspect people just have weird ideas about what Australia is actually like. I usually encourage Americans to think of Australia as a Scandinavian country.

135:

I find the panglossian approach from the experts a little odd.

It seems that the old system in bilateral treaties has been abused.

It would seem remarkably optimistic to think the new system will not also be abused.

Finally, Maurer may be happy that the USA is insulated by the power of it's courts. But it looks like bad news for the NHS when we end up in the DC circuit court...

136:

Quite so - I think it's pretty clear that universal healthcare systems everywhere is a designated target for these shenanigans.

137:

if they've got the brain cells to realize it

That seems to be a big ask. See: GOP candidate debates

138:

It seems that the old system in bilateral treaties has been abused.

Examples?

it looks like bad news for the NHS when we end up in the DC circuit court
it's pretty clear that universal healthcare systems everywhere is a designated target for these shenanigans.

EU statement: "there is no reason to fear either for the NHS as it stands today or for changes to the NHS in future, as a result of TTIP or indeed EU trade policy more broadly."

Please show where universal healthcare systems are designated as a target in the US Trade Representative's list of goals and objectives for TTIP.

139:

The TPP trade deal is currently being negotiated between the U.S. and ten other Pacific Rim nations. The negotiations are being conducted in secret, but leaked drafts of the agreement include aggressive intellectual property (IP) rules that would restrict access to affordable, lifesaving medicines for millions of people...

As a medical humanitarian organization working in nearly 70 countries, Doctors Without Borders/Médecins Sans Frontières (MSF) is concerned about the impact these provisions will have on public health in developing countries where MSF works and beyond.

http://www.doctorswithoutborders.org/news-stories/briefing-document/trading-away-health-trans-pacific-partnership-agreement-tpp

You can read the draft version that would impact NHS drug procurement etc, here:

https://www.wikileaks.org/tpp-ip2/

Specifically:

[NZ/CA/SG/CL/MY/VN/BN/AU propose: (g) the protection and enforcement of intellectual property rights should contribute to the promotion of technological innovation and to the transfer and dissemination of technology, to the mutual advantage of producers and users of technological knowledge and in a manner conducive to social and economic welfare, and to a balance of rights and obligations.

(h) Support each Party's right to protect public health, including by facilitating timely access to affordable medicines.]

and


The Parties have reached the following understandings regarding this Chapter:

The obligations of this Chapter do not and should not prevent a Party from taking measures to protect public health-{by promoting access to medicines for all, in particular concerning cases such as HIV/AIDS, tuberculosis, malaria, and other epidemics as well as circumstances of extreme urgency or national emergency.} Accordingly, while reiterating their commitment to this Chapter, the Parties affirm that this Chapter can and should be interpreted and implemented in a manner supportive of each Party's right to protect public health and, in particular, to promote access to medicines for all.

In recognition of the commitment to access to medicines that are supplied in accordance with the Decision of the General Council of 30 August 2003 on the Implementation of Paragraph Six of the Doha Declaration on the TRIPS Agreement and Public Health (WT/L/540) and the WTO General Council Chairman's statement accompanying the Decision (JOB(03)/177, WT/GC/M/82), as well as the Decision on the Amendment of the TRIPS Agreement, adopted by the General Council, 6 December 2005 and the WTO General Council Chairperson's statement accompanying the Decision (WT/GC/M/100) (collectively, the “TRIPS/health solution”), this Chapter does not and should not prevent the effective utilization of the TRIPS/health solution.

With respect to the aforementioned matters, if any waiver of any provision of the TRIPS Agreement, of any amendment of the TRIPS Agreement, enters into force with respect to the Parties, and a Party's application of a measure in conformity with that waiver or amendment is contrary to the obligations of this Chapter, the Parties shall immediately consult in order to adapt this Chapter as appropriate in the light of the waiver or amendment.


You can then search this string:

"us drug company legal challenge doha Declaration TRIPS Agreement"

To find rather a lot of literature on what happens in reality to these types of broad statements.


Hint: the 'person' with the most expensive lawyers in US courts win.

Citation:

Several countries have already attempted to use some of the exceptions and qualifications found in TRIPS to foster public health goals. In at least two cases, national attempts at taking into consideration both patent holder interests and public health concerns and the human right to health have led to significant legal disputes. South Africa was the first country to find itself in the eye of a health-related storm after a dramatic surge in HIV/AIDS infection rates led the government to pass the 1997 Medicines and Related Substances Control Amendment Act...

Brazil also got embroiled in a dispute with the United States concerning its compulsory licensing regime [10]. In particular, the US objected to a provision providing that unless ‘economic unfeasibility’ can be demonstrated, the inventor has a duty to manufacture the product in Brazil and can be subjected to compulsory licensing if the invention is not worked. The US contended that this was in contradiction with the TRIPS requirement that the patent holder can choose whether to import or locally manufacture. The WTO panel was withdrawn by the US in June 2001 on the understanding that Brazil would hold talks with the US if it ever wanted to use the compulsory licensing provisions against a US company[11].

http://www.ielrc.org/content/f0201.htm

The International Environmental Law Research Centre (IELRC) is an independent, non-profit research organisation established in 1995. It is constituted as a Swiss Association under Articles 60ff of the Swiss Civil Code and is a registered charity in the UK (1107304). It has offices in Switzerland (Geneva), the UK (London) and Kenya (Nairobi), and benefits from a strong network of expertise in Ind

*stretches slightly*

140:

The TPP trade deal is currently being negotiated between the U.S. and ten other Pacific Rim nations.

The NHS is not in any of those countries, so TPP will not affect it.

141:

Also, the TRIPS agreement is already in force for all EU countries and the US, so TTIP will not affect it either.

142:

I'm well aware that the NHS isn't covered by the TPP. The TTIP will effect it however.

If you'd not noticed, I quoted the relevant part of the TPP with relation to TRIPS, with reference to S.A. and Brazil.


Given the model of US healthcare and the legal framework that has been used to counter attempts to at least use some of the 'public good' parts of the TRIPS, I count your question as answered. You've rather dodged answering why you still consider the TPP as not an extention and enforcement of TRIPS (and other things we cannot see yet - these are only leaked drafts, in particular this one is quite old)


I don't consider it a good model, fyi.

143:

The EU has said that its draft treaty with Canada would be a model for TTIP. That deal includes a general exemption, or ‘carve-out’, for services provided “in the exercise of governmental authority”. But what this concept covers is a little uncertain, and many international lawyers think it doesn’t exempt most public services...

Whether or not the law described above actually matters in practice depends on how it’s enforced. Opponents like Unite say that companies could use ‘secret courts’ to exploit the uncertainties in the law.

This refers to investor-state dispute settlement (ISDS). Normally, trade agreements are enforced by countries taking action against one another. But TTIP is also an investment agreement. These typically allow companies that have invested in a foreign country to claim compensation for breach of the agreement in an arbitration tribunal, instead of taking action in local courts or relying on their government to step in.

https://fullfact.org/law/does_ttip_mean_privatisation_nhs-38681


Good resource: has lots of links within the piece to both pro and con sources. Mid tier level stuff.


That's the discussion in a nutshell.

144:

the relevant part of the TPP with relation to TRIPS, with reference to S.A. and Brazil

I did notice. I still don't see why that is relevant to a negotiation between the US and Europe, which does not include South Africa or Brazil. There are, of course, genuinely difficult issues about international pharmaceutical procurement, which is why there are treaties dealing with it. Your quote from the IELRC is incomplete; it's worth noting that in both cases, the parties challenging the South African and Brazilian governments had to back down in the end.

Your quote from the draft TPP document is hardly a smoking gun: "this Chapter can and should be interpreted and implemented in a manner supportive of each Party's right to protect public health and, in particular, to promote access to medicines for all" doesn't sound exactly threatening.

Since you ask, I'll be clear: I don't regard TTIP or TPP as an extension or enforcement of TRIPS, which is a separate, already existing treaty which the UK and USA both signed 20 years ago. If TRIPS is a threat to the NHS, it is a bit late to start worrying about it, but the fact that the NHS hasn't been a designated target of TRIPS in the last 20 years rather suggests to me that it won't be in the future either.

As for the direct threat from TTIP to the NHS: The EU side clearly say they want to exclude the NHS from TTIP, and the US side has not shown any intention of pushing against that; there are plenty of other things to talk about, as helpfully listed on the websites of both the US Trade Representative and the European Commission. What is the problem?

145:

The problem is that most of us don't think pharma industries need more tools for enforcing their IP and making profit. In fact, maybe if they were making less profit they'd start to make those medicine again that they stopped producing for not being profitable.

146:

Yep, the Fullfact.org page is a better resource; it's out of date on ISDS and "secret courts" though (see quote from Commissioner Malmström which I cited earlier).

147:

No, Puerto Rico isn't in as bad a position as Greece. Krugman has a good short rundown of the differences here. The US is a fiscal union, not just a currency. So there's a lot of money in the form of Social Security etc that automatically flows in, Puerto Rico's banks are banked by Washington DC and it is far easier for young and able bodied Puerto Ricans to hop a plane for the United States than it is for Greeks to seek work elsewhere in Europe. It's hard to get slavery going when the most productive workers can simply leave.

As a side note, Puerto Rico is much smaller than Greece, which isn't that big an economy to begin with. Greece isn't in a crisis because the problem is so intractable, it's in a crisis because the leaders of the European Union profoundly suck at their jobs.

148:

I'm not an expert on pharma IP, and would certainly defer to our host and others on that point. It just seems to me an odd ground for objection to TTIP, which doesn't really deal with that topic. (At a quick glance, the EU position paper on pharma doesn't mention IP, and neither the EU nor US papers on IP mention pharma.) As far as I know the big problems in the area are not between the US and EU, and therefore will not affected by TTIP one way or the other. But I'm willing to be educated.

149:

Indeed, the legitimacy of profit as a goal is highly questionable.

(Profit is an excellent metric. It's a terrible, terrible goal, like a lot of things that are good as side effects and wretched as goals.)

150:

Greece is a problem because the surgeons would rather chop off the rotted limb than see the rot spread to Spain, Italy, and other major organs.

151:

As for the direct threat from TTIP to the NHS: The EU side clearly say they want to exclude the NHS from TTIP, and the US side has not shown any intention of pushing against that; there are plenty of other things to talk about, as helpfully listed on the websites of both the US Trade Representative and the European Commission. What is the problem?

When you expect war, don't look at the enemy's claims or their perceived intentions. Look at their capabilities.

This version of the secret treaty might (IANAL) give the US government or US corporations the right to require that NHS be "reformed".

The US government and US corporations have not shown any big interest in doing that. But if the British government or somebody else wanted them to, would they do it in return for some other favor? Maybe the USA helps dismantle NHS and Britain helps dismantle Social Security? (Or something else -- anything else -- that a "conservative" US government wants dismantled.)

If they bother to say they aren't planning to do it, that says nothing about whether they will do it. It only says that there is enough worry that they will do it that they want to provide some empty reassurance.

"We're only taking the *power* to do that, because we want to have the power. We aren't really going to use that power to do anything bad. Trust us."

152:

As someone said about my organisation "Never underestimate the viciousness of the ."

Aha! This tells us all we need to know to find out which organization is yours! I merely put this phrase into Google and see what pops up! Mwahahaha!

What do I get for the X that is left out?

ego. 4 instances
queer demon. 1
severely religious. 4
left. 1
progressive liberal democrat communists. 1
ruling class. 3
LTTE. 1
host. 1
modern Republican party. 1
Bush crime family. 1
right wing. 1

So throwing out the entries that are not organized, your organization is either the Bush crime family or the Tamil Tigers! You have been doxxed!

(Apologies if this actually hits close to home. I didn't intend it to. I was trying to make a joke.)

153:

J Thomas,

There is no "secret treaty". Anyone can look at the websites of the negotiators and see what they are talking about. If you choose to believe the voices in your head instead, that's your privilege.

154:

Bad metaphor.

I'm pretty sure corruption and bad administration are not contagious. The only thing that could spread to Spain and Italy would be non-austerity politics. And that's in my view not the disease but the cure.

About chopping of Greece: Even if they expel Greece from the Eurozone, it would still be a member of the EU and NATO. So given the choice to solve Greece's problems inside or outside the Eurozone, what makes you think it's easier outside?
And no, devaluation will not help with the debt and it will be offset by expensive imports, loss of confidence in the economic stability, and foreigners buying all profitable concerns.

155:

Indeed ... almost a year back at the London World con (IS it really that long?) there was a talk on:
"Women, cattle & slaves" - which about summed it up neatly.
( Da'esh, of course are well into Kinder, Kirche, Küche are they not, along with a whole lot of other "policies" from the same playbook. )

156:

Also agreed - but WHY?
Profits for the pharma/"Healthcare" companies?
Except that a larger profit is made, overall, if your population is healthy.
Bit like education, actually.
It's horribly expensive if you don't have it.

157:

In which case why are people trying ( & really stretching to do so) to get a "treason" charge against Varoufakis (sp?) for merely having contingency plans for leaving the Euro?
If they wanted to chop off the gangrenous limb, then allowing a "New Drachma" would seem to be an obvious move.
Um

158:

There is no "secret treaty".

Interesting. As usual, I am not an expert on this. I go on google and type 'TTIP leak' and there are a whole lot of links to things which have leaked about TTIP which supposedly were intended to be secret.

What's going on about all that? Are people pretending that this stuff is secret when it isn't? They loudly announce that they have leaked secrets, when really anybody could have found the same things without depending on leaks?

And all these smart people on Charlie's blog were also fooled that there were secrets except maybe a few who kept quiet, and you're the first to reveal that the leaks are all fake leaks of stuff that was never secret?

159:

Agree ... know some patients in the West who are extremely concerned about the continued availability/affordability of a high-tech/$ (US mfg) treatment.

A question:

Fine, the tariffs will be evened out/controlled/eliminated ... but what about the market pricing within each of these areas?

The tariffs basically limit what each government can pocket, and to enforce said tariffs, jobs are created. Historically, tariff deals do not bring lower prices to consumers/end users ... companies do not reduce their prices because of tariffs. (See economic impact of NAFTA... the basic takeaway is that: (a) markets would have found each other, (b) governments lost revenue (hence bargaining position), (c) corporations saved money/gained revenue, (d) cost of living kept going up while (e) jobs went to the lowest bidder.)

http://www.cfr.org/trade/naftas-economic-impact/p15790

Excerpt:

'Twenty years after its implementation, the North American Free Trade Agreement, or NAFTA, has helped boost intraregional trade between Canada, Mexico, and the United States, but has fallen short of generating the jobs and the deeper regional economic integration its advocates promised decades ago. Trade relations have broadened substantially, and U.S. manufacturers created supply chains across North America that have made companies more globally competitive. These factors may have stimulated economic growth; Canada has expanded at the fastest average rate and Mexico at the slowest. But economists still debate NAFTA's direct impact, given the many other economic forces at play and the possibility that trade liberalization might have happened even without the agreement. Both advocates and critics of the treaty have lobbied for changes to NAFTA, but momentum has stalled and is likely to be overtaken by larger trade agreements under negotiation such as the Trans-Pacific Partnership and the Transatlantic Trade and Investment Partnership.'


What I'd like to see:

Trade deals that most favor governments who represent people (organic individuals) and not corporations*. Deals that are easy to read, understand, amend, quick and not costly to enforce ... i.e., not a lawyer's wet dream.

* This just about means a deal that specifically does not favor the U.S. given the morals, priorities, intellectual prowess and paucity of any ability/desire to work together with anyone who is not their clone ... as per last night's Rep candidates 'debate'.

160:

The only thing that could spread to Spain and Italy would be non-austerity politics. And that's in my view not the disease but the cure.

I'm certainly not saying that the surgeons are competent and have diagnosed the problem correctly. Still, from the standpoint of those charged with preventing a continent-wide banking implosion, any attempt to repudiate debt (implicit in any non-austerity policies) is a nightmare scenario.

As a general rule, when competent people have been banging their heads against a problem for over half a decade, there probably aren't any simple answers.

161:

Are people pretending that this stuff is secret when it isn't? They loudly announce that they have leaked secrets, when really anybody could have found the same things without depending on leaks?

Yes.

And all these smart people on Charlie's blog were also fooled that there were secrets except maybe a few who kept quiet, and you're the first to reveal that the leaks are all fake leaks of stuff that was never secret?

I wasn't the first; Noel Maurer got there before me.

162:

SFReader,

Interesting points which go beyond my knowledge of economics. But one important aspect of TTIP is that it's not so much about the tariffs - which as you probably know are pretty low anyway - but at least as much about agreeing decent regulatory standards that the rest of the world should eventually have to match in future trade deals. It's not a race to the bottom, as libertarians hope and others fear; it's an opportunity to influence global standards for decades to come. I haven't done much more than skim the public documents, but that's what jumps out at me from them.

163:

While I won't ask for a direct Full Disclosure statement from you, you're being ever-so-slightly disingenuous.

The TPP has been known about for five (5) years and it's only very recently that documents have been released for it, and they're 100% not the entire documents or negotiating working papers.

You could (with a certain degree of accuracy) state that such documents have been made available due to the leaks / pressure by interested parties. e.g. Australian MPs were hit with a 4 year NDA if they wanted to view the (draft) documents:

http://static.guim.co.uk/ni/1433217576506/Trans-Pacific-Partnership-a.pdf

http://www.theguardian.com/business/2015/jun/02/australian-mps-allowed-to-see-top-secret-trade-deal-text-on-condition-of-confidentiality


So, there's more than a little retroactive democratic oversight being applied here.


Mr Whyte is being a little rude when he equates suspicion over the trade deal with "voices in your head"... unless that's his conscience that he ignores in his day-to-day life. (Take it as a light poke, not a serious comment).


ISDS' have been used by tobacco companies against the Australian government, as this gov. website proves:

https://www.ag.gov.au/tobaccoplainpackaging


Now, there's a case to be made that smoking legislation falls under the public good / health aspect of TRIPS etc, but I'll leave that for another time. Suffice to say, ISDS' are being used aggressively by Corporations, despite what Mr Whyte claims.

164:

Not sure who else would consider this a 'benefit' of tariffs, but being able to define and quantify (and not double-count) trade goods/services is important.

Don't know if anyone's looked at this: the reliability of trade reporting (measurement) pre-vs-post free-trade agreements. This 2009 United States Government Accountability Office report shows a bit of qualitative guesswork of what should have been quantifiable economic results.


http://www.gao.gov/new.items/d09439.pdf

Four Free Trade Agreements GAO Reviewed Have Resulted in Commercial Benefits, but Challenges on Labor and Environment Remain

Overall results/conclusions: meh... oversight is lacking. Synopsis: we threw out the old rule book, handed out a new rule book, but because congress said that 'gov't is too big', we didn't bother to hire any staff to check in to see how well this works'.

165:

Regarding Greece comments, there's been a lot of aggro on both sides due to failure to pay for life-necessary drugs.

It's only just been resolved (or, rather, kept on a saline drip):

Pharmaceutical companies will provide a constant supply of medicines to the people of Greece through the financial crisis, according to the Hellenic Association of Pharmaceutical Companies (SFEE), which represents subsidiaries of multinational and Greek companies...

The government owes the pharmaceutical industry €1.05bn and no payments have been made since December 2014.

http://www.pharmaceutical-journal.com/news-and-analysis/news/greek-debt-crisis-will-not-affect-supply-of-medicines-pharmaceutical-companies-say/20068867.article


Note: there was a prior issue with supply / payment that was solved by one of the debt payouts, so this isn't an issue that has only arisen Dec 2014 - this year, it's been a constant.

166:

Catina,

The original post was talking about TTIP, not TPP. I don't pretend to any knowledge of TPP. I'm not professionally engaged on TTIP either, just a very interested observer.

I note your comments about ISDS; I note also the firm EU statements that ISDS will not be part of TTIP. Noel Maurer addressed the substantive point in his first intervention.

As for "voices in your head", if I show someone evidence that X is not the policy position of actor Y, and they say that they know X must be the real policy of Y just because they know, that really is "voices in your head" territory, isn't it? And that's what happened in the exchange you refer to. Suspicion is of course always justifiable, but let's base it on observable facts please.

167:

Well, the TTIP was announced in Mar 2013 (
announement [PDF], while a reputable leak took until early 2015 BBC - 26th Feb 2015. Oh, wait, nope - it was in March 2014.
German Green Party, Mar 2014.

However, the point is that there's been a constant Official / semi-official / totally verboten set of releases over both of these deals.

All sides have been playing fast-and-loose with the rules.

~

Re-reading the thread carefully, and #39 in particular, I think the Greek issue over pharm. payments is a noticeable one.

The first instances were noted in early 2013 (
Guardian 27th Feb). Of course, this being Greece, there was immediately a counter-scandal where it was discovered that they were attempting to raise some funds... using said drugs:

Greek wholesalers are selling millions of pounds worth of drugs, acquired at low prices set by the state, to other EU countries - preventing them from reaching the Greek patients that need them.


(Yes, gallows humor applies).


The issue is still ongoing in 2015 (as noted by the biz. journal above) and people are still facing shortages.


So, the real question is: if politics is failing here, and supply/demand negotiations are failing, what does it take to stop this kind of horrible life-costing snarl up? I think that's a bit more interesting than particular ISDS' (which, as you've noted, tend to happen post-effect).


It'd be interesting to get an (off the cuff) serious perspective though.

168:

Because it is still an option being considered. The one thing they need is time.

169:

The killer part of the medicine export scandal, is of course: Regulators in Athens have been trying to tackle the problem with fines and export bans.

Which, technically under things like TPP / TTIP, national governments don't really have the right to do.


Sorry. Bear trap. Couldn't help myself.

170:

And note:

Medicine scandal goes back to 2011.

ATHENS (Reuters) - Pharmacists from the wider Athens region, home to about half of Greece's population, said on Thursday customers must pay full price for medication until the country's main healthcare provider pays a subsidy backlog of nearly $1 billion.

State healthcare insurance pays most of the cost of drugs in Greece but pharmacists say the state owes them 762 million euros ($944 million) for drugs delivered on credit since 2011 and they can no longer afford to deliver them without payment.

http://mobile.reuters.com/article/idUSBRE84U0WW20120531?irpc=932


It basically looks like the drug bill / annum for Greece was $2 billion and they've constantly struggled to provide it (since? probably 2010).

Corporations [sell direct to?] wholesalers / Greek local pharm. organizations [provide for] - Citizens - reimbursed by State - who has set prices. There's probably a missing piece or three visa vie big Corp / State negotiations over prices / volume delivered.


Messy, and as far as I know, not the way the NHS does it. But it points to where the cracks happen (in this case, the wholesalers going broke and then re-selling to EU for higher prices than they'd get locally).

171:

Moderation Note: Nicholas is known to me personally and I believe him to be sensible, level-headed, and very unlikely indeed to be being disingenuous on this subject.

172:

My point after reading the U.S. government's own analysis is that there is no desire, effort or mechanism to even measure the effectiveness of this treaty/pact/agreement. Therefore is/will be no regulation standard. To say that this will help everyone play on an even playing field is also silly ... the U.S. gov't has repeatedly shown no interest in monitoring/measuring such deals. Apart from grandstanding, there is no benefit to this deal. (Okay .. U.S. banks have regularly been big winners when 'free trade' increases.)

Re: Big pharma payment schedule ...

In my experience, big pharma orgs typically have terms that go 'we'll take the 2% thanks! and we'll pay you in about 180 days'. IMO, pharma can afford to extend payment terms to the Greek pharmacists who've been caught in the middle.

173:

if I show someone evidence that X is not the policy position of actor Y, and they say that they know X must be the real policy of Y just because they know, that really is "voices in your head" territory, isn't it?

What do you accept as evidence?

If you accept Y saying that he does not support policy X, then I can prove to you that US policy toward Iraq in 2003 was to prevent Saddam from getting nukes and to establish a prosperous liberal democracy in Iraq.

Politicians and dipolomats lie.

But they don't lie as much when they are making treaties. If Y proposes a treaty that says he will not do X and if he does the treaty is broken and reparations are in order, I would consider that evidence that he likely does not intend to do X. But if he proposes that he will be allowed to do X and other parties to the agreement will not try to stop him from doing X, that says maybe he intends some sort of X-like activity regardless whether he says "I have no intention of ever doing X.".

So for each X that you say this treaty is not supposed to allow, does the actual proposed treaty allow X, or does it forbid X, or does it not mention X directly but it's reasonable to conclude from what it does allow that it will allow X, or what?

174:

First, in response to J Thomas (172):

"But they don't lie as much when they are making treaties. If Y proposes a treaty that says he will not do X and if he does the treaty is broken and reparations are in order, I would consider that evidence that he likely does not intend to do X."

Are you familiar with NAFTA? (Look up the forest industry, e.g., Canada vs. US ... which has been a consistent seesaw ride from day 1. Then look up all of the treaties the U.S. arm-twisted other countries into signing, but decided not to sign on to themselves. (See the U.N., or even Wikipedia for this.)

Thought this might interest Charlie ... intellectual property rights ... although the article is oldish (Oct 2013).


https://www.eff.org/deeplinks/2013/10/another-reason-hate-tpp-it-gives-big-content-new-tools-undermine-sane-digital

Excerpt:

"Like the rest of the TPP, we only know what has been leaked. Based on that, it seems the negotiators are poised to give private corporations new tools to undermine national sovereignty and democratic processes. Specifically, TPP would give multinational companies the power to sue countries over laws that that might diminish the value of their company or cut into their expected future profits.

Stop Secret Copyright Treaties

The provision that gives them this power is called “investor-state dispute settlement” (or ISDS for short). .. Under investor-state, if a regulation gets in the way of a foreign investor’s ability to profit from its investment, the investor can sue a country for monetary damages based on both alleged lost profits and “expected future profits.” There are no monetary limits to the potential award.

... investor-state also requires the creation of a new court .. comprised of three private-sector attorneys who take turns being judge and/or corporate advocate.

... The investor-state tribunal bills its time by the day and decides for itself how many days to work, so it can rack up as many days of work they want. Given this system, it's then no surprise that current investor-state court costs average about 8 million dollars per case.

... Once a decision has been issued, there is no way to appeal it.

... The supposed “cause” of these lost “investments” can include environmental standards, labor standards, and yes, even intellectual property rules. So far, countries have been forced to shell out almost half a billion dollars thanks to similar provisions in other trade agreements. ... Eli Lily and Company, a pharmaceutical giant based in the U.S., filed a $500 million lawsuit against Canada last month under a similar investor-state provision contained within the North American Free Trade Agreement (NAFTA).'

Need a lawyer here ... what are the typical rights, obligations and mechanisms in contract law? (Starting with British Common Law and Napoleonic Law.)


175:

"But they don't lie as much when they are making treaties. If Y proposes a treaty that says he will not do X and if he does the treaty is broken and reparations are in order, I would consider that evidence that he likely does not intend to do X."

Are you familiar with NAFTA? (Look up the forest industry, e.g., Canada vs. US ... which has been a consistent seesaw ride from day 1. Then look up all of the treaties the U.S. arm-twisted other countries into signing, but decided not to sign on to themselves. (See the U.N., or even Wikipedia for this.)

OK, I was wrong. When the USA proposes and signs a treaty that says it will not do X, that is not evidence that it will not do X.

Does it work for some other nations, though?

176:

So, what do you all propose to do about it?

177:

I propose to discourage my government from approving it until they have explained to the public just how it works. I figure it shouldn't take them more than 5 years or so to come up with a clear explanation.

178:

NAFTA was a boon for transnational corporations, it allowed GM to relocate assembly plants to Mexico. 700,000 manufacturing jobs were lost in California, Texas, and Michigan as production was shifted to Mexico.

My hometown of Flint, Michigan closed several plants, the V8 Engine plant, the Fisher Body Plant Number One (first sit-down strike in the US), the Buick, Cadillac, and Oldsmobile plant, AC Delco plant (sparkplugs and filters). Unsurprisingly the population of Michigan dropped substantially during the 1990s and lost tax revenue at both the state and city level. You’ve all heard about the city of Detroit bankruptcy.

From my perspective transnational corporations profit the most, while local populations are more at risk with these trade agreements.

179:

Dirk wrote: So, what do you all propose to do about it?

I predict bugger-all will be done, because TTIP and the like don't push enough modern progressive/activist buttons.

These agreements are between (for the most part) westernised industrialised nations. So the anti-colonialists aren't interested.

A lot of progressives think nations are quaint or even dangerous and like agreements that override local law, eg the International Criminal Court, Kyoto Protocol and Doha amendment. If TTIP becomes binding on EU members, there's not going to be an upsurge of British/Scottish activists demanding withdrawal.

As a legal agreement, the TTIP language will be thoroughly inclusive. Whatever your skin color, sex, or preferred partners; the provisions will apply to you. Nobody is being exluded by identity politics.

And while it is almost certainly the work of rich white men, it's been fed through the government bureaucracy anonymiser. There's no Twitter feeds to trawl through in the hope of finding evidence of language misuse.

All that's left is an agreement reshaping the power balance between capitalists and everyone else. That's so 20th century! We've got to focus on Caitlyn Jenner and Timothy Hunt!

180:

Your detailed comments on NAFTA were illuminating, but in a very different direction.
What, then has been the overall effect of A N Other common-trade & tariff-free zone on employment & productivity.
The EU ????

181:

~ 177 & 178
You have just re-stated my objections to TT(I)P etc.
Going back a long way, let's see if I can find it:
THIS one is not the original article I was looking for but ...
When a right-wing free-trader like the author says TTIP stinks (as did the original article I can't now find) then you know something is seriously worng.

182:

Please elaborate ... I don't understand 'illuminating, in a different direction'.

Tried some searches for metrics on EU trade agreements - the closest/best I found is this book: The Year in Trade 2009, Operation of the Trade Agreements Program, 61st Report. (Googling 'success metrics of european trade agreement' brought me to a page in this book about the beef industry citing jurisdictional differences in defining beef health/safety, penalties (mostly the U.S. easing on punitive fines on the EU because the EU refused to import drugged beef), etc. Looks interesting, and it's an ebook ... maybe the local reference/uni library has a 'copy'.

The site below meanwhile summarizes all of the EU trade agreements - again no goals, metrics.

http://ec.europa.eu/enterprise/policies/international/facilitating-trade/free-trade/index_en.htm


Aren't there any academics (and/or grad students) around who study this?

183:

There's a PDF of this book here: (Plus for following years.)

http://www.usitc.gov/publications/332/pub4174.pdf

184:

The back of this book includes detailed import/export by product by trading partner, in $ and % change vs. base year. Clunky presentation, but at least it's there.


Ha! Apparently, free trade agreements do not stop charges of (lawsuits re:) dumping ... so, what's the difference between a 'really good deal' and 'dumping'?

185:

More reading ... WTO listing of trade agreement disputes by country. Includes products involved. According to this, there are/have been 33 disputes between the U.S. and E.U. In total, the U.S. is the complainant in 108 disputes, the respondent in 124 disputes, and a third party in 124 disputes. (Note: Not everything ends up at the WTO ...)


https://www.wto.org/english/tratop_e/dispu_e/dispu_by_country_e.htm

Here's a map showing dispute interactions between countries. (This one shows the U.S.)

https://www.wto.org/english/tratop_e/dispu_e/dispu_maps_e.htm?country_selected=USA&sense=e

And the rules of the game ...

https://www.wto.org/english/docs_e/legal_e/ursum_e.htm#Understanding

186:

Right - so you're making clear that you are talking about the TTIP that affects right-pondians, and not the TPP that effects me (and in fact distancing the former from the latter). Whereas when I talk about healthcare systems as targets, I am not thinking of the NHS (other than perhaps handwaving over it as part of the same generality), but rather the Australian MBS and PBS.

I think you're saying no-one has to worry because the TTIP isn't the same as the TPP, but personally I find that disingenuous (Catina, I was already going to use that word to describe Nicholas' position before I saw you use it. Honest) being after all a Queenslander living in Queensland. I suppose my "assume good faith" interpretation is that you hadn't picked up that this forum isn't totally UKish, or even totally euro-transatlantic.

I *am* concerned that the IP provisions of the TPP will gut our pharmaceutical benefits scheme and change the way we currently fund medicines for the worse. If you think that your version is relatively benign, then good for you. But I've seen plenty of awful stuff done in healthcare that can only be explained by corruption of the sort all the people talking in quasi-conspiracy theory terms would understand. I think it's always easy to marginalise a discussion by talking about how strange such a "conspiracy" might be, but from my perspective it's never about an organising principle of conscious agent, just an alignment of interests and people, pulling in the same direction. Not because they colluded, but just because they have the same interest. And I definitely find such marginalisation disingenuous.

187:

Nicholas has done the heavy lifting here: thank you! Please look me up if you're ever in D.C.

Regarding forestry disputes and NAFTA -- that's a feature, not a bug. (I'm replying to J. Thomas, but I believe that SFReader brought it up first.) The lumber disputes started in 1982, were a prominent point of contention during the CUSFTA and NAFTA negotiations, and were never really resolved. Basically, both sides agreed to disagree, with NAFTA serving more to limit the scope of the disagreement than set the rules for resolving it.

Here's a nice 2006 essay on the subject by Jeff Colgan, currently at American University.

You can find two out-of-date chronologies here and here.

Short conclusion: The U.S. didn't comply with NAFTA regarding lumber, but that intention was never a secret and it certainly wasn't a surprise! The forestry disputes do not contradict Nicholas's point, which is that the stated positions of trade negotiators are rather good indicators of their actual positions. And they are very good indicators of what their governments will actually do once the treaty is signed.

The weird thing about free trade agreements (unlike, say, the internal workings of the E.U.) is that they don't actually ban breaking the rules. Rather, they limit the retaliations that governments can impose when other governments break the rules. In practice, they function more as firewalls to prevent trade wars than as guarantees that goods can cross borders unimpeded.

188:

Nice one! What I wrote was 'bra oligarchs ket', where 'oligarchs' was not the actual word, but is a translation that would make sense to the outsiders. The same remark applies to the people that control the USA and UK.

189:

According to this 2004 report, courtesy of the US NCBI, part of the problem is Australian public disinterest in local hospital board elections. Voter turnout dropped from 35% in 1995 (first election) to 10% in 1999 (most recent election) mentioned.


Report title:

Health System Organization and Governance in Canada and Australia: A Comparison of Historical Developments, Recent Policy Changes and Future Implications


http://www.ncbi.nlm.nih.gov/pmc/articles/PMC2645208/

Professional management/fiscal focus: This report concludes that there seems to be an increasing tendency toward centralization and 'professional management' running the show (i.e., CAO, not an M.D.). Suggest you compare earnings/salary of your local hospital's CAO vs. the Chief of Medicine. That'll tell you something about priorities.

Bigger player/bigger discount: OTOH, centralized hospital/healthcare purchasing groups can be a good thing especially re: stocking generics and playing the volume discount card.

Centers of excellence, triage/access: I'm somewhat aware of the Canadian hospital scene and it seems as though there's increasing organization around the med school/teaching/research hospitals. The local/regional general hospitals handle the run of the mill diseases/medical and surgical needs, but anything particularly unusual or serious is almost immediately shifted to the 'centers of excellence' (teaching/research hospitals, or provincial cancer care orgs/hosps).

Best practices re: stocking the hospital pharmacy: Australia probably also has a PTC (Pharmaceutics and Therapeutics Committee) in each hospital. This is the committee that decides what drugs to list in its hospital pharmacy based on a combination of effectiveness, need and cost. FYI - the PTC has been around for over 80 years, and the NCBI site probably has info on it.

Pharmaconomists: Yes, they're here .. economists on staff at some of the larger hospitals, regions, etc. whose primary responsibility is to identify, track and analyze healthcare metrics vs. costs/spending at the hospital/agency level. (Some clinical trials results for me-too drugs are sold on the basis of being more cost-effective because of fewer expensive side-effects. All this is being number crunched in some of the larger institutions ... less BS.)

190:

"It seems that the old system in bilateral treaties has been abused.

Examples?"

Since you ask. Treaties to do with preventing the export of technologies to 'hostile' countries have been used (in the UK) to prevent to prevent purely UK companies from competing with the UK branches of USA multinationals, and to make it significantly more problematic and costly to buy from Japan rather than the USA. In those cases, I have close experience of the details (in one case personal and direct), and have some knowledge of how the scam/scheme was (is?) operated. I have reason to believe that the converse did and does not happen.

I know people who have had commercially-sensitive data (including pending patents) passed to the USA government (again on 'national security' grounds) and suddenly found it in the hands of their competitors including, in some cases, being patented against by a company with no research base in the area. The converse has, not as far as I know, happened.

We have had British citizens pre-convicted and extradited, using so-called evidence inadequate even for a charge in the UK, others who have never been in the USA extradited to be charged for something that is not a crime in the UK. The converse has, not as far as I know, happened.

You claim that the information is online, but I looked, and found nothing of use. Oh, yes, the waffling is online but, as everyone knows, the devil is in the details for any such deal. That applies whether it is technical specifications, contracts, law or treaties. And there is nothing on the formal, treaty wording.

We know that the claims are the NHS is going to be excluded, but do you SERIOUSLY think that it is going to be given total immunity in the treaty? The best we can hope for is that the treaty won't allow it to be nibbled completely to death.

I could go onto the way that our 'national security' treaties with the USA have been abused so that we are their fifth column, spying on other countries in Europe, the conditions on their armed forces and bases, and our so-called independent nuclear deterrent and such things as our military aeroplanes. But I have no definite knowledge (merely corroboratory evidence) of the unilateral nature of such deals.

I am sorry but, in this case, I am siding with Catinadiamond.

191:

"Are people pretending that this stuff is secret when it isn't? They loudly announce that they have leaked secrets, when really anybody could have found the same things without depending on leaks?"

Yes.

This document:
http://corporateeurope.org/pressreleases/2015/04/ttip-leak-eu-proposal-undermines-democratic-values


claims that this document:
http://corporateeurope.org/sites/default/files/reconstructed_ec_proposal_regulatory_cooperation_march_2015_0.pdf

was leaked. Was there a way to get it that did not depend on leaked sources?

192:

I am popping up to answer the questions about Joe Haldeman's "The Long Habit of Living" aka “Buying Time”. I am confident I remember most of the details, but it has been years since I read it. I don't know OGH's policy on spoilers so I will be marking them or not mentioning them at all. But there will inevitably be hints about them, be warned.

The Stileman Foundation is not an evil monopolist corporation, or at least it didn't start out as one. Stileman was worried he was going to create a ruling class of immortal plutocrats. Stileman was an idealist so he set it up as a benevolent monopolist non-profit to prevent this. Of course, organizations may not stay true to their original purpose, as the novel shows.

The rejuvenation process is not a cheaply made pill. There are dozens of operations by hundreds of people over a period of weeks. Plus the cost of equipment, infrastructure, supplies, etc. The actual cost is probably within an order of magnitude of the minimum £ 1,000,000 charge (£, not $). They block or wipe your memory of this time to spare you anguish.

So even if it went open source, most people still couldn't afford it. However, [SPOILER].

I don't recall it specifically, but I think the Foundation is *supposed* to give its profits on charity. So the money circulates. There is an in-novel complaint that the economy is held back because no one makes risky investments anymore, lest they imperil their next Stileman. Not sure I buy that, but that is what a character says.

I don't recall that the Foundation particularly tries to take over the world, except as noted below.

One thing it spends a lot of money on is keeping the process secret. It buys a lot of lawyers, accountants, politicians, archivists, etc. to do so. And it is not overly concerned with ethics or laws in pursuit of this goal. Goons, thugs, hit men, ninjas, etc. are used if necessary.

The doctors, nurses, etc. who do they actual work of rejuvenations live their lives in gilded cages. They get free Stilemans and every luxury money can buy, but their contacts with outsiders are carefully controlled.

The plot of the book is the basic action-adventure one of an ordinary guy minding his own business when for no apparent reason thugs show up to kill him. He spends the rest of the novel running, fighting, and trying to find out what he has done and who it has pissed off so much.

Why aren't there knock-offs? This is addressed in the novel.

The Foundation really doesn't want you do do that and will use their wealth to stop you. They will also deny you rejuvenations if you annoy them by doing this or trying to cheat on the “ALL of your money” rules.

They've also infiltrated medical all the online medical archives and databases to subtly screw up any attempts to duplicate the process.

193:

"The Foundation really doesn't want you do do that and will use their wealth to stop you. They will also deny you rejuvenations if you annoy them by doing this or trying to cheat on the “ALL of your money” rules."

In the UK, there is an increasing move by the government and the corporations to which public services have been outsourced to require the use of at least a bank account and often a debit card. It's already very difficult to impossible to access some essential services without, including a great deal of employment, anything that involves a contract, and payments from the government (including repayments of what it owes you). There are regular moves to allow organisations to refuse cash for payments for sales.

The government and the cartel of banks have also 'arranged' (a so much nicer word than conspired) that people and organisations can have their bank accounts closed for no disclosed reason, and be forbidden from opening new ones, with no legal challenge. It is already being used to discourage 'undesirable' organisations that don't actually break any laws.

194:

The government and the cartel of banks have also 'arranged' (a so much nicer word than conspired) that people and organisations can have their bank accounts closed for no disclosed reason, and be forbidden from opening new ones, with no legal challenge. It is already being used to discourage 'undesirable' organisations that don't actually break any laws.

This is wrong and should not be allowed.

Bankcards are money. And they do not involve a whole lot of new technology. To the extent they do, the government has the best specialists.

So I think it's time for governments to issue their own bankcards. You could do your checking account stuff in any post office, and do POS stuff at any terminal. Do ATM stuff at any ATM, paying the ATM fee.

The USA already has debit cards for people on welfare, people who have disabilities they get monthly income for, etc. The IRS could send your income tax refunds directly to your debit card account. Of course, all the money in your account you haven't spent yet is a zero-interest loan to the government.

Make the law be that the government can't cancel or freeze your debit card until a court orders it for a criminal conviction. They can record what you spend your money on, though.

And if you walk into a post office to do a card transaction they would have the right to demand ID, and to arrest you if there's a warrant out for you.

I think with adequate enforced laws limiting abuse, this could be a good thing.

195:

The US model isn't particularly good as welfare and food stamp cards are provided by private companies that charge the state to issue them and then charge beneficiaries fees for certain transactions and balance inquiries. A large portion of the funds end up in corporate pockets.

A similar state provision of toll transponders has been abused by agencies harvesting the location data. Moving to an entirely cashless economy seems like a recipe for financial abuse by middlemen and an intelligence trove for every possible data mining agency.

196:

The US model isn't particularly good as welfare and food stamp cards are provided by private companies that charge the state to issue them and then charge beneficiaries fees for certain transactions and balance inquiries.

It doesn't have to be that way. The USA does already give government-issued debit cards to a fraction of the population, though, so it's one step in the right direction. From there it's only a couple of giant steps to do it as a government-owned business that's partly automated, and to just put a basic inadequate income in everybody's accounts without checking to see whether they deserve it.

Moving to an entirely cashless economy seems like a recipe for financial abuse by middlemen and an intelligence trove for every possible data mining agency.

Yes. It isn't necessary to move to an entirely cashless economy. Just, the government claims the sole right to mint money, so it ought to have the sole right to issue debit cards. I'm not asking for it to make all other debit cards illegal, just that it actually issue debit cards as it claims the right to do.

A cashless data-mined society would have some potential for good. Like, if economists could mine that data, we could actually start to get economic results that are based on reality. Economists wouldn't have to just make it up, they could actually get real data to work with.

197:

I wonder how that would drive policy as economists already use data derived from card purchases in judging consumer behavior. The assumption that large scale deployment of debit cards would account for enough economic activity seems to miss some glaring blind spots.

Some purchases don't lend themselves to payment with a card. Here in Colorado, marijuana businesses operate on cash because they're not allowed bank accounts. Small proprietors often take only cash because they don't want to pay processing fees. Large purchases like cars also are largely through cash or check because card fees are a large enough percentage that dealers don't want to let that money go.

The knowledge that the government has ongoing direct access to purchase data would influence purchasing as well. Whether that would be enough to bugger economic conclusions, I don't know. Certainly, the necessary additional regulation to keep processors from overly skimming would also seem to make it hard for populations that the government doesn't recognize (immigrants) or wants to discourage (sex workers) to participate in the regime.

198:

I don't have questions about the novel in question - I'm reading it now. I will avoid reading the rest of your comment till I've finished TYVM :)

199:

Issues to consider:

a) If you essentially force individuals to use only one (government provided) debit or credit card, then you have set up a universal, completely trackable, non-anonymous ID card. This would not be a popular move ... in fact it would be much closer to what the Soviets and People's Republic might have been accused of attempting to do about 20-30 years ago during the Cold War era.

b) There are several large corporations that make a ton of money selling/analyzing online/credit/debit card data. And although having only one data set would improve reliability and make it much easier to forecast economic activity, you'd end up destroying one of the newer service/information industries.


I like the idea of a cashless society provided there are tiers of e-currency, all equally reliable and accessible, and that the system cannot be easily gamed.

200:

Some purchases don't lend themselves to payment with a card. Here in Colorado, marijuana businesses operate on cash because they're not allowed bank accounts.

Make it legal and let them have bank accounts. Sheesh. It will be hard to track the illegal shadow economy regardless.

Small proprietors often take only cash because they don't want to pay processing fees.

The government is already collecting taxes. Let them pay a lump sum and not a high processing fee. The government provides money as a convenience to assist the economy, so we don't have to do inconvenient barter. It's silly to put a transaction tax on the order of 2% on that. That's like building toll roads to add inconvenience. Collect taxes enough to pay for the system, and let it go at that.

Large purchases like cars also are largely through cash or check because card fees are a large enough percentage that dealers don't want to let that money go.

We don't have to use that ridiculous business model when the government is providing the service.

Private companies can provide private cards too, that people can use for whatever niches they are competitive. But it makes sense for government to have low or now processing fees, so to compete they should make their big profits some other way.

The knowledge that the government has ongoing direct access to purchase data would influence purchasing as well.

I don't know what to do about things which are directly illegal. That might be a niche that private companies could fill. When it's people buying things they're ashamed for the government to know about, I'm not sure of that either.

Certainly, the necessary additional regulation to keep processors from overly skimming would also seem to make it hard for populations that the government doesn't recognize (immigrants) or wants to discourage (sex workers) to participate in the regime.

I don't particularly care about making it easier for illegal immigrants to participate in the economy. Probably something would work out, though.

Sex workers who already lack legal protection could request a gift beforehand. If they get a lot of gifts you might infer that they are sex workers, since beggars would get fewer smaller gifts. Of course they could do barter and get actual stuff, which would be somewhat inconvenient. But I understand that they already have a problem of inconspicuous consumption. Easy to buy stuff you can get with cash that doesn't show, harder to buy things that would get the IRS on them.

To my way of thinking, the problems we already have, with private card services that charge high fees, reveal their data to government and some others, and deny service to whoever they want or whoever the government wants, are not a big improvement over a government-run service. If we leave them legal then if it turns out they are an improvement we can keep using them.

201:

If you essentially force individuals to use only one (government provided) debit or credit card, then you have set up a universal, completely trackable, non-anonymous ID card.

I think it would be much better to provide individuals with their free debit card, and then let them legally use whatever other cards they want too. If at some time it turns out that the private cards are not economically viable, then that's unfortunate. But if they can't compete then too bad, we can have them if we're willing to pay what they cost.

There are several large corporations that make a ton of money selling/analyzing online/credit/debit card data. And although having only one data set would improve reliability and make it much easier to forecast economic activity, you'd end up destroying one of the newer service/information industries.

I don't see that we need large corporations making a ton of money selling stuff that we don't in fact need, or that can be provided much cheaper.

If they provide sufficient value-added then they will do fine. Otherwise we don't have any big obligation to them.

202:

You've illustrated one of the large problems with the economy, an excess of middle folk, each with a hand out and seemingly immune from the cost cutting axe.

203:

"the government claims the sole right to mint money"

The vast majority of money is not made by any government but rather made by private individuals or businesses with the help of a bank. When you create a debt with a bank you are creating money from nothing.

Cash is made by governments but that makes up a tiny proportion of the money in circulation at any given time.

Even that cash is not *technically* minted by the government. Bank "notes" came about by a group lending the government 1.2 million pounds at 8% interest. What they then did was to divide up that debt and on sell it as "notes". The bank note in your pocket promises to repay some of that debt. Some of the banks that had had that debt have been nationalised, but the process is unchanged. Indeed, the government's way of creating that money in the first place is essentially identical to the way you create money when you get a home loan. Your loan gets either chopped up or mushed together with other people's loans and ends up as money that is almost the same as a bank note. An easily transferable container of debt.

204:

"the government claims the sole right to mint money"

The vast majority of money is not made by any government but rather made by private individuals or businesses with the help of a bank. When you create a debt with a bank you are creating money from nothing.

Yes, I know.

Traditionally governments declared a monopoly on money. They coined it themselves, and if anybody else did it they called it counterfeiting and arrested them.

But somehow now it mostly gets done by private banks. They create money from nothing and loan it and collect the interest. That would be criminal except people sort of think the banks are somehow providing a social service by collecting all that interest.

In the USA I think it's basicly because the public (or somebody) did not trust the government to manage the money supply. They thought the government would do a bad job of that. So they instead trusted banks, who on average over the years did a *terrible* job of it.

When it became obvious that the banks were worse than government, they set up the Federal Reserve, a private organization of bankers insulated from politics whose most important job was to manage the money supply. They promptly did such a bad job of that, that they helped create and prolong the Great Depression. And of course the events of 2008 and since should give us much reduced confidence.

I don't see how any reasonable person could advocate this situation, unless he has to. "It is difficult to get a man to understand something, when his salary depends upon his not understanding it."

If at some point we were to make fractional-reserve banking illegal, then economists would know how much money there is in the system. There are the coins, and there is the money in the various accounts, and that's the money. It would surely be easier to do financial policy when you know how much money there is.

The government could increase the money supply by spending money -- putting more money in people's accounts for services rendered -- or by giving away money. If for example the government wanted to increase the money supply by around $300 million, they could put one extra dollar on everybody's debit card. It would stimulate the economy. If you think there's too much inflation you could tell your government so, and they might decide to add a dollar less next time.

I'd hesitate to try something new which might have unexpected problems, when we had a perfectly good system that already worked adequately. But we do not. What we have is not working, and there's little to lose by trying something different.

205:

I think it's even worse than that.

Since 1973 the US dollar has been backed by other people's oil rather than gold. That's let them run a financial management system that would collapse any other currency in short order.

So we now have a situation where if we don't stop burning (and buying oil) in short order (like 5 years ago) we're going to be in for very unpleasant times. But if we do stop buying oil, the US (who has all the power and all the guns) tanks...

Interesting times ahead.

206:

Gold, oil, tulip bulbs, they're all a tangible metaphor for the basic concept of money as a counter for trade exchanges, the "promise to pay". Money, whether electronic or notes and coins, is an IOU. Government IOUs are regarded as the safest IOUs in part because the governments make great efforts to support the IOUs they have in circulation since they want to continue to issue IOUs in the future. They spend decades, even centuries building up that level of trust in their IOUs by always, always, meeting that "promise to pay".

The idea of money being "backed" by anything tangible like gold or a commodity like oil or a fancy like tulip bulbs is an mental artifact of people who aren't a government and who don't understand where money comes from.

As for oil, it's a newcomer compared to coal. We still burn billions of tonnes of coal each year to generate electricity and make iron and steel but no-one says coal "backs" any world currency even though it's a major trade earner for several large countries.

The deal with oil is that it is only traded in US dollars in the world markets even if the two parties in the trade aren't American. That means the US issues a lot of IOUs and knows they will never need to be redeemed for US goods or services since too many people outside the US need them to trade with. Those dollars are literally "free wealth" for the US.

207:

There's an issue with generalising from that paper, in that in Australia healthcare governance is overwhelmingly a state matter and the difference between NSW and Queensland can be greater than the difference between NSW and another country (or the two provinces in Canada the study compares with NSW).

208:

Money, whether electronic or notes and coins, is an IOU. Government IOUs are regarded as the safest IOUs in part because the governments make great efforts to support the IOUs they have in circulation since they want to continue to issue IOUs in the future.

The US government faced the problem that the continental government before them had issued a whole lot of IOUs to fight the war with the british, and to pay them off for real would require crushing taxes at a time when the economy was already doing badly. So they worked out a banking scam to pretend to pay. The American government has been going that way in wartime ever since, and then Reagan figured out that deficits don't matter.

The government could pay part of its expenses just by printing money. Take the increase in GDP, call it 3%. Add in an inflation target of maybe 2%. 5% of GDP, factor in a guess at the money velocity, call it 1.25% of GDP the government could spend without needing to collect taxes or anything. Not a very big government.

For the government to spend a lot without much inflation, it must either collect a lot of taxes (mostly from the rich and from banks because they have the money) or else borrow a lot of money (mostly from the rich and from banks because they have the money).

If you were rich, which would you prefer? You can put as much money as you like into the safest possible lending, and take it out whenever you want. Or the government taxes you.

We created government debt basicly because we wanted to be nice to rich people.

209:

You've got it a bit backwards. Remember, rich people don't just loan to governments but to ordinary people. Inflation erodes debts effectively transferring money from creditors to debtors. Mild predictable inflation can be compensated for with higher interest rates but nonetheless the rich tend to be the most concerned about inflation. That's why gold bugs are generally a right wing phenomenon and why conservatives are most concerned about keeping inflation low with far less concern for unemployment.

There's nothing wrong with governments running debts to deal with major crises. There's a good book "Sinews of Power" which shows how England emerged as a great power in the 18th Century precisely because a more modern government let it tax and borrow more efficiently than its rivals. The US ran up a lot of debt in World War II, but it did help solve both the Depression and the Nazis. And the debt steadily declined as a percentage of GDP until Reagan. But after Reagan the debt once again shrank as a percentage of GDP until Bush the Younger cam along, where it rose slowly and then sharply when the recession hit. But it's leveling off again. It's the wealthy who push for draconian methods for dealing with the nation's debt. It's a problem but a manageable one and we've done a lot to deal with it in the past few years.

210:

Remember, rich people don't just loan to governments but to ordinary people. Inflation erodes debts effectively transferring money from creditors to debtors. Mild predictable inflation can be compensated for with higher interest rates but nonetheless the rich tend to be the most concerned about inflation.

Of course. Mild inflation is not so bad for rich people when it is predictable. But in general nobody knows the future.

I'm suggesting something that's kind of radical, and it's understandable that you don't get it.

First, let's make sure we agree about how it is now. Most of the money in the system is virtual money, created by banks. The Fed tries to have the right amount of money circulating, and so they encourage banks to lend the right amount of money. When there are not enough credible borrowers, the Treasury increases the volume of bonds they sell, borrowing more money and raising the deficit so there will be enough money in circulation. The government sets the level of taxation low enough so those bonds will have a large enough volume to keep the system running as usual.

Including state and local bonds, US governments pay about $350 billion in interest each year on this debt. People who think of it as debt are outraged, but of course if we weren't paying that interest we would have to borrow that much more to get the bonds to the right level so we could have the right amount of money in circulation.

I suggest that we don't have to do it that way. We could gradually raise taxes enough to pay the ongoing expense of government and pay down the debt, if we didn't need it to keep the money supply stable.

And when we need to increase the money supply without waiting for the government to actually spend the money, we could just add it to everybody's debit cards. If the money supply looks like it's too big and we're getting inflation, then tax the surplus money.

The way we do it now is of questionable morality. If I counterfeited money and lent it, expecting to get real money back plus interest, I'd go to jail. Because I don't have a bank license, a license to counterfeit.

And the way we do it now is of questionable utility. Banks are not efficient at their job when we need them to be.

Its sustainability is also questionable. The reforms that were supposed to happen after 2008 mostly did not happen. Our financial system destabilizes itself, and there's no reason to think that will improve without actual reform.

We would need to be careful with any reforms. Many of our giant corporations cannot survive without borrowing a whole lot of money at favorable rates, money there is no reason to think they could ever pay back. No, wait. If we have a lot of big corporations that can't survive on their earnings but that are TBTF, shouldn't we do something about that? Saying we have to keep our dysfunctional financial system so that our big dysfunctional corporations can continue business as usual would be insane.

Still, we would need to be careful.

211:

The only interesting thing about this thread is that the experts disappeared once concrete evidence against their position appeared.


I'm familiar with it. Just, I'm not sure how your mind works when it happens.

Watership Down doesn't strike me as a valid governing process.


p.s.


I know how it works. I can see it before you ever make the peanut to grow it. I can see you running from it.

You're not even fucking human. Never challenge an Angel if you're not actually human. (This actually happened - 30+ version. They don't know it yet though.

Logos:

If you base your morality on information that a stranger cannot have, and then base your "killer move" on it. Then, logically, your move is based on a lie.

And if it's all based on a lie, you lose.


Done. Fucking. Deal. Although I'd pretend to not having seen it coming, but the usual discourse of using an emotionally damage women and issues of "shame" over her son (when, ahem, dudes - you all bought the drugs of her son) and so on were so obvious.

Oh, and I poked said Son to leave the community and join a University.

I've no idea beyond that if you tracked him down to use as a weapon.


Hint: this is logos:

YOU CAN SHOUT LOUD. BUT IT'S NOT TRUE. AND I'M CALLING IT IN AS A FAILED THING THAT ONLY DESPERATE CUNTS WOULD DO.


That's your new God?


Fucking hilarious.


Logos. It's done. Oh, and "I have no idea what you're talkingh about"... 100% true. That's not to say I didn't see it being formed, it's just that you're so old and fucking inept, I let you dig that hole.

Done. Deal.

Logos.


Fuck. Your. Paltry. Level. Shit.


(apologies to host - this is a logos type spell. Needs to be printed, because these fuckers are DUMB.)

Oh, and on printing: a thousand times I asked to be Judged for Death, and a thousand times I passed. Let them run that one (they can't, little lying muppets).


QED - Enjoy the Peanut.

212:

Catina
Could we PLEASE have that again, in English this time?

213:

Safe to ignore Greg. As I understand it, we are very far from the target audience for this nonsense (in fact, I suspect that it isn't meant for any one here).

214:

Catina,

I've been travelling for the last two days, and haven't had time to track this discussion, which in any case has largely drifted away from my area of expertise.

Catina and Damien,

From my perspective, our host started a discussion about TTIP, but you only wanted to talk about TPP. Not only is TTIP what I know about, it also seemed to me what the point of the post was about. If you felt I was disingenuous, I felt you were derailing.

Elderly Cynic,

As I think is clear from context, I was referring to bilateral *trade* treaties because that's what the post was about. Although someone more cynical than I might suggest that the examples you give are working just as intended rather than being abused...

J Thomas,

Interesting find. Of course the document in question is a draft, and therefore wasn't public. However, the value of serving the public interest by leaking it is I think diluted by the facts that a) it was a draft and b) the final version would have become public, and open to debate and amendment, long before the proposals in it (ie creating a new committee called the Regulatory Cooperation Body) could ever become operational.

I'll note also that the claims made about it in the article you link to - effectively, that the Regulatory Cooperation Body will be a secret group of business reresentatives and officials with the power to change law - are directly contradicted in the leaked document, which makes it clear that the intention is to create a body including civil society as well as other stakeholders, whose membership and meeting agendas and minutes will be public, and which will have no regulatory power (see last two pages in particular).

This was the first I had heard of the proposal, I admit, but I'm not terribly impressed by your source's reporting. Its almost as if they got hold of a draft document and then decided to bang on about the issues they planned to bang on about anyway, regardless of the evidence. I had previously had a moderately good impression of Corporate Europe Observatory, and I think their role in holding the EU to account is very important, but I hope that most of their work is better than this.

215:

Does anyone else remember the time Charlie coded up a script to combine random snippets of Lovecraft and the King James Bible together? I think we could get a surprisingly good Catina emulator by mashing together random phrases from Chomsky, Betty Friedan, and 4chan.

216:

That won't make sense if CiaD already is a perl script. The last thing we want to see is two scripts outcompeting each other...

217:

I'm very convinced that there is a real person behind the CatinaDiamond identity; but as presented on this blog, she is a very carefully constructed personality, and nothing more.

218:

If it wasn't meant for any one here, then why is it on this blog-thread?

Also, occasionally CiD produces something of direct sense & Import - the most recent I remember was her snark on the rights of Women as a very recent (historically/long-view speaking) phenomenon.

219:

Within the communication framework and world model that CatinaDiamond works with, this makes complete sense. Think in terms that we (all the regular participants on this blog) are not the only ones reading this, imagine that there are other shadowy forces playing deep games in the background.

Basically, you can buy into the techno-mysticism or ignore it; but all indications are that her communication style is not going to change.

220:

Also, there is every chance that when CatinaDiamond's comments dive into this style, that they are being made with tongue firmly lodged in cheek.

Or we could take at face-value the self-made claims that she's heavily intoxicated by the wee small hours, and ascribe the whole thing to drunken ranting.

Or maybe a smidge of all of the above.

221:

If it wasn't meant for any one here, then why is it on this blog-thread?

Because it's completely harmless and no one with the authority can bring themselves to tell her to go away.

Whenever someone speaks gibberish there's the chance that they're communicating with other people in a secret code, and they're telling each other insulting things about you. You just have to live with that possibility.

It was that way for me visiting Harvard. When I tracked down obscure references in their library and the librarians asked if they could help me, I sensed the subtle feeling that they thought I was beyond help but -- noblesse oblige -- they would do their jobs anyway. Talking to experts about a genetics possibility. Talking to economics grad students.

I stayed with an old friend who fit right in, he was in a group living arrangement with a bunch of other post-docs. Late at night I asked him whether it was OK to flush the toilet. Some places with thin walls you don't do that late at night so it doesn't wake people. He immediately went all Harvard on me and asked why one would possibly not do that. I explained.

"Oh, that's no problem. You've met Katherine. She's extremely promiscuous and she has some sort of urinary tract infection. She gets up to pee at all hours of the night, and she flushes every time. I'm sure no one will notice you doing it too."

The next day when John was not present Katherine came to me. "I want you to know that the walls are thin and I'm a very light sleeper, and I heard your whole conversation last night." I couldn't tell quite what she wanted from me but I sensed she didn't expect me to proposition her. She was offended at me.

"Well, you know our friend and his sense of humor. I hope you don't just believe whatever he says about me." She didn't seem at all appeased.

It was some sort of cultural thing I didn't understand, and in my short time with it I couldn't think of anything better to do than just proceed as if it wasn't there, since I didn't see how to influence it.

222:

Whenever someone speaks gibberish there's the chance that they're communicating with other people in a secret code, and they're telling each other insulting things about you. You just have to live with that possibility.

My theory is that CatinaDiamond is a rogue time traveler using steganography to communicate with other rogue time travelers without alerting the Time Patrol.

223:

I find myself reminded of Hitherby Dragons.

224:

I vote for not paranoid enough.

> is it plausible to consider the secretive binding arbitration provisions in TTIP to be a pre-emptive move to prevent an assertion of people power by angry disenfranchised electorates after the house of cards comes tumbling down at some point in the next 5 years?

I can't speak for the England side of the pond. But here in the US of north A, there is something called a "constitution". While completely ignored in the last 50 or so years, it does say that the only legal court system is one supreme court, and lessor courts appointed by law. Which kind of says that any court that claims to not permit you to appeal to the supreme court, or that does not grant you the rights that you would have in the supreme court, is not valid.

As I've said, between forced arbitration and other things, this has been ignored. This trade treaty, with the international court that can override the supreme court, etc., is just another example of an unconstitutional system.

At some point, the constitutionality of the treaty will be challenged. At that point, one of two things will happen.

1: It will be recognized that between signing/agreeing to a treaty, and ratifying/making it the rule of the land, constitutional amendments must be passed, and the treaty will be thrown out, or

2: The courts will amend the constitution and declare a treaty to automatically amend the constitution. This may -- might -- trigger a revolution. Or, it might fail because private-run jails, police, and (probably soon enough) courts are better able to lock up trouble makers before it can start.

Case #1 is the more interesting one. If the USA were to break treaty, that would only say that within its jurisdiction it would not apply. Interacting with the rest of the world would still make the USA subject to being sued in world court for damages. I think that same principle applies to a new Parliament over there overriding a past Parliament.

The longer we take before we say "enough", the bigger the eventual cost will become.

====

While skimming, I saw someone mention a race to the bottom. We've been in this for decades now, since the first free trade / "let the workers move anywhere!" (really, let the corporations move anywhere) treaty. If the people in nation A want current wages plus money to set aside to retire, while the people in nation B only want current wages, then B will have workers employed, and A won't.

Corporations do not want the largest possible pool of people to sell their goods to.

If they had the largest possible pool of people to sell goods to, then they'd have to hire more people.

As long as there is a huge surplus of unemployed people, the cost of labor is kept down, and even though they are making less short-term profits, they are making more long-term profits. Now, add to this trade treaties that make it easier and easier to move to the cheaper labor, given that nations like the USA are starting to crack down on directly importing workers. Add to this the idea of "Do work in nation A, but claim to be a resident of nation B; get the resources of A, but pay cheaper taxes to B", along with "employ people oversees through the internet / phone system" (think phone banks, or programming contracts, etc), or just "get parts made overseas", etc.

===

Did you notice that in the USA, with the election speeches starting, everyone talks about "Protecting the people of this nation", or "Protecting our borders", or "Protecting our national interests", etc., and yet not even one of these people say "Protect the constitution"? That's how I know that we've lost already. Sadly.

What stops me from saying it? I lack any financial support group to fund me, lack any press connections to be noticed, lack any "rolodex" connections to learn what I know that I don't know, etc. I've seen this for about a decade, and failed to bring it to people's attention. (My blog got perhaps 2-3 dozen views, total.)

Meanwhile, I've got 4 more days of people's comments to read through ...

225:

Did you notice that in the USA, with the election speeches starting, everyone talks about "Protecting the people of this nation", or "Protecting our borders", or "Protecting our national interests", etc., and yet not even one of these people say "Protect the constitution"?

Because that is not a good campaign issue.

More and more, people have noticed that the US Constitution means whatever US citizens agree it means.

And when they disagree? We sort of agree that the Supreme Court gets to decide, but increasingly people do not agree. Against all practicality the assert that the US Constitution *really* means whatever they and their friends say it means.

If a candidate for US President claimed he would protect the Constitution, what could he possibly be saying beyond "I will select Supreme Court Justices who agree with *you* about what it means!"?

Presumably this will bubble up at some point, like a methane bubble from a swamp. Some candidate will talk about protecting the Constitution, meaning he will veto gun control legislation and work toward banning abortion and select Supreme Court justices who will in general rule in favor of what decent people approve of and not in favor of blacks or gays or socialists, or in favor of people who want restrictions on large corporations, etc.

226:

Really? I thought CD was a genius black-hat disguised as an out-of-their-depth conspiracy theorist pretending to be a top NSA agent who's really an alien superbeing disguised as a living demo of the Dunning-Kruger effect who can't use html or spell vis-à-vis correctly.

All of which, of course, are just cover identities for the GCU Are we still using this joke?

227:

Apologies if it seemed derailing to you, but from my perspective I was only generalising the part of the discussion I was participating in to include my own world. Not an unreasonable thing to do, if you think it though.

228:

What is GCU?

http://www.acronymattic.com/GCU.html

Is it from the Laundry files and I forgot it?

229:

From Iain Banks' Culture novels: "General Contact Unit". A relatively modest-sized spaceship (and its controlling Mind) involved in evaluation of, and communication with, cultures less advanced than the Culture.

230:

OpCit the much missed, lately sublimed SF author overly referenced and punned crossthread.

231:

Thank you! I've been reading about those, I just finished Consider Phlebas, but there were various acronyms and I didn't think of that just now. Thank you again.

232:

Yeah but that ship's in the news all the time since its avatar started appearing as the opening batsman for the West Indies

233:

"TTIP is due to be ratified by next year, and once locked in, it would be really difficult for a government (however popular) to move unilaterally to demand an accounting of its creditors."

Here's a thought- If governments are prevented from protecting their citizens from the predatory practices of foreign corporations, then perhaps we will see a widespread popular reaction against trade agreements in about 5 years or so. Perhaps we should prepare for another round of protests? That could even be a silver lining of sorts- if they had been smart enough to throw the populists a bone, maybe in the form of some sort of appeal process, then mobilizing support to oppose these sorts of things might have been harder. As it is, nothing says "Globalization" like having your governments lose in arbitration to some multinational.

234:

Regarding the race to the bottom, I'd say that immense corporate entities fear more than they hope, and this colors every decision, hope would suggest that a market with more money available to the participants the benefits would outweigh the possible negatives, fear whispers about new competitors taking market share and inflation devaluing assets, fear usually takes the decision. Mostly, fear based decisions don't have a long term future, but we're stuck with them as long as intimidation is fashionable in business circles.

235:

Well, they are on top of the world right now. They have everything to lose, and nothing to gain, by allowing change. Time is on their side, after all, if the rest of us do nothing. So consolidation would be the go-to strategy for them.

236:

For the moment, but it fails to be a long term strategy, they just hope it doesn't blow up while they're holding it.

237:

I'd say that immense corporate entities fear more than they hope, and this colors every decision

I hadn't thought about that before, but it makes perfect sense. A whole bunch of executives with imposter syndrome, who feel like they have a lot more to lose than to gain, trying to play it safe.

That might have more predictive value than a collection of more complicated ideas.

238:

My experience has always been that, at the top of the heap, greed trumps fear. Senior executives tend to have huge egos and many opportunities to fail upward. On the other hand, the middle management that implements change has a great deal to fear. The art of middle management seems to involve pretending to support the CEO's vision of change (so as not to get fired) while avoiding change itself (so as not to be made redundant).

If we assume that middle management usually wins by sheer numbers, then we get back to the idea that corporations act fearfully.

239:

I did some digging and while in theory the US courts have the ability to rule on the constitutionality of treaties, they haven't really done so. Which makes sense in that it would be very hard to establish standing.

In the case of treaties containing ISDS mechanisms, the arbitration is between the aggrieved corporation and the feds. If a city passes a law outlawing Japanese cars, Toyota takes the US government to the arbitrators and the penalties are decided against the nation. The local parties don't get a say and while they might sue the feds over whatever remedy that's decided on to avoid the penalty, a suit wouldn't touch the treaty.

The federal government would have standing to question the constitutionality of a treaty, but they already have the ability to unilaterally withdraw without resorting to the courts. They're unlikely to do so since there are almost certainly built-in sanctions that would make that an unpleasant option.

240:

"Here's a thought- If governments are prevented from protecting their citizens from the predatory practices of foreign corporations..."

They are not prevented. What it means is that corporate entities can use other nations to make the cost prohibitive through things like sanctions. See Greece as an ongoing warning. Of course, really powerful nations like the USA can do what they want because nobody is powerful enough to make them do anything. See Russia and China as ongoing examples.

241:

Which "corporate entities" have applied "sanctions" to Greece as an ongoing warning?

The Greek government is desperate to borrow a lot of money in a hurry. They have a track record of borrowing money and not paying it back. The folks in the ECB who are willing to lend them money knowing it's a risky transaction given that track record have a number of conditions. The Greeks don't like those conditions but no-one else in their right mind would lend them money now as their promises to repay previous loans have been proven worthless.

If there's a lesson other nations can take from this it's don't stiff the people you borrow money from if you want to borrow from them again in the future, especially at low interest rates.

US Treasury 10-year bonds today, 2.17%.
UK 10-year gilts today, 1.82%
Greek Gvmt 10-year bonds today, 10.2%.

I'm actually surprised that anyone is buying the Greek 10-year bonds at any price, I assume there's a lot of insurance involved.

242:

The Greeks don't like those conditions but no-one else in their right mind would lend them money now as their promises to repay previous loans have been proven worthless.

Greece is a third-world nation trying to maintain a first-world lifestyle. They can't do it on loans, if anything they need gifts.

If the EU had accepted Senegal as a member, nobody would expect them to get lots of pharmaceuticals, oil, or anything else expensive. They are a third-world nation. Life expectancy is something like age 55, around 4% of their babies die in the first year. Nobody expects it to be different. That's just how it is.

We need to just tell the Greeks "You're a third-world nation. You can expect to die young and watch some of your children die young, because you're poor. Get used to it. That's just how it is." But somehow people think it shouldn't be that way. Probably because Greeks are white europeans and members of EU.

They're just the first. Some nations like China are getting richer, and a lot of others are getting poorer. We can't expect EU members to be immune to that. In the capitalist world market there are winners and losers, and if you happen to live in a loser nation then it sucks for you.

243:

The Greek government is desperate to borrow a lot of money in a hurry. They have a track record of borrowing money and not paying it back. The folks in the ECB who are willing to lend them money knowing it's a risky transaction given that track record have a number of conditions.

There are several things wrong with that.
A) Greek has paid back their loans as agreed with the exception of the arrear of the IMF payment this summer.
B) The debt was build up for decades, this government inherited it from former PAZOK/ND governments.
C) The credits are needed to pay interest on their unsustainable debt. Greece was not allowed to default in 2008/2009, otherwise the position would be different now.

244:

a whole lot of crap about defaulting on bonds.

You have zero idea what you are talking about.

There have been plenty of sovereign defaults in the past.

There will be more in the future.

We know exactly how to handle it, and funny enough there are always bond buyers lined up and ready to purchase.

Past your ignorance of this history, your rhetoric indicates you are treating this like a moral issue rather than an economic one. Which is so out of touch with reality and clear thinking it qualifies you for the ECB, but not to weigh in with a sensible opinion on what is happening.

You do realize there is a reason the IMF - an organization by no means a friend to the working class or democratic states - is calling for debt relief?

245:

Third world / First world is so 20th century, don't you think?

For the record: life expectancy in Greece is 81 years, same as in Germany or UK, and higher than for example the US, Colombia and Cuba (all 79). Infant mortality is also lower in Greece than in USA or UK.

So instead of putting more countries in the "third world" basket we should maybe concentrate on lessening the differences between countries like Germany and Senegal. We are on this one Earth together, A "just forget about the losers"-attitude will not help us, just look at the climate catastrophe or refugee problematics.

246:

My son (aged 25) just spend 2 1/2 months in Guatemala. It is definitely not a 1st world country. And the locals know it.

247:

If you find yourself thinking, "I can say this as rudely as possible," or "I can try for politeness," please go for the latter.

If you don't find yourself thinking that, please start.

248:

Greece != Guatenala

I was responding to J Thomas' claim that Greece was a third world country.

I'm not saying that some countries are poorer or have more problems than others. I just don't agree that one should say "that's just how it is, so stop complaining".

249:
Third world / First world is so 20th century, don't you think?
Given the "Second World" was the Soviet sphere of influence, it became abruptly obsolete in the early 90s. And using Third World for economic development was always wrong, given it included Sweden and Switzerland... there's a reason people pushed for the use of "developed/developing countries."
250:

For the record: life expectancy in Greece is 81 years, same as in Germany or UK, and higher than for example the US, Colombia and Cuba (all 79). Infant mortality is also lower in Greece than in USA or UK.

It is *now*. But if they can't pay for pharmaceuticals or modern medicine etc, then likely it will fall. Those are things they cannot now afford. That's part of the issue, right?

Either we arrange for them to have those things even though they can't pay for them at the going rates, or we insist that they do without.

And as they retreat from "developed nation" medical care and nutrition etc, it's predictable their life expectancy will drop.

Isn't it?

251:

Not in the short term. And we won't allow Greece to sink into poverty for good, it's part of the EU. Once you start to let countries fall off the cliff, the EU would disintegrate.

252:

... there's a reason people pushed for the use of "developed/developing countries."

Basicly the reason is that it's kind of a taboo concept so the name has to keep changing. Kind of like "colored, negro, afro-american, black" etc.

Or people started to panic when they heard "heart attack" and started using "coronary" and "myocardial infarction" etc, scary names that weren't the scary name they panicked over.But each time a new name started to be commonly used, it turned into something that people got upset over and so they started using a new name -- among laymen. Medical terms with precise meanings kept being used by MDs talking to MDs, of course.

It's rude to call a nation "primitive", or "undeveloped". "Underdeveloped" started getting rude too, "developing" is becoming rude, what's the new polite term for it?

Of course it's natural from the language to suppose that there are predictable patterns of development. Newly developing nations naturally try to start a textiles industry, since they have lots of people who are willing to work for low pay, and that's what it takes to do unautomated textiles. So human beings sitting at sewing machines try to compete with machines, and it does essentially nothing for the nation's "development".

253:

Who is this "we" of whom you type? I mean I'd like to be chippy and upbeat and all that, but the evidence so far from 5 years of painful austerity in Greece is that the people in charge seem happy enough with mass immiseration.

254:

And we won't allow Greece to sink into poverty for good, it's part of the EU. Once you start to let countries fall off the cliff, the EU would disintegrate.

Isn't that part of the controversy? Whether the EU should try to prop up its weaker members, or whether it's better for it to disintegrate?

From one point of view, the central problem is Greek corruption. Their government doesn't collect all its taxes -- too corrupt. If the Greek government would just collect all the taxes they need to, and cut government spending to what they can afford, then they could pay their debts. Until they do that, extra money for them is just wasted.

The Germans know about this. After WWI they had crushing debts, and they worked hard for low rewards. It made them strong. Joy Through Strength. Freedom Through Work. After WWII their economy was bombed to hell and gone but they worked hard for low rewards, and now they're in a position to pass it on and collect punitive reparations from other nations.

When other nations required Germany to pay, they didn't just complain and refuse. They fought very very hard and overcame their problems. They expect no less from Greece.

255:

Did you miss that I said Switzerland and Sweden were (are) Third World? It's a political segmentation, not economic; its use is being deprecated because it's wrong, not for reasons of politeness.

256:

I think most continental Europeans want a united EU. Governments are dragging their feet because they are busy blame shifting and playing "you pay - no, you pay", but the EU can not risk for any member to become a failed state.

257:

It's a political segmentation, not economic; its use is being deprecated because it's wrong, not for reasons of politeness.

It's completely anachronistic as a political indicator, but it still gets mis-used as an economic indicator. The connotation of "third-world" has usually been "non-aligned and poor". India was never *that* poor, India was a nation about the size and economic strength of France embedded in a vast heap of poverty. They could probably have built nuclear weapons rather earlier than they did -- but they didn't want to. When the USA decided they didn't need to support so many anti-communist dictators, then "third-world" went from "unaligned and poor" to just "poor".

Your meaning is right technically among people whose professions lead them to use the term technically. But tell an American that Switzerland is a third-world nation and they'll look at you like presidential candidate Ford getting told that Poland is not a free country.

258:

Newly developing nations naturally try to start a textiles industry, since they have lots of people who are willing to work for low pay, and that's what it takes to do unautomated textiles. So human beings sitting at sewing machines try to compete with machines, and it does essentially nothing for the nation's "development".

Anyone expert enough to look at this photo of a Moroccan shirt and tell me whether the embroidery is by hand or machine? If the former, perhaps this is one example where hand-sewn textiles can out-compete machine-sewn ones. I've had a lot of clothes hand-made for me in Morocco that for comfort and colour and quality of fabric and general attractiveness, seem to me better than anything I could buy from G*p, N**t, P*****k, *&*, and other well-known sellers of machine-made clothes.

How this can be turned to the good of the nation's "development" is another question. But other nations seem to manage with chocolate, cars, cheese and other speciality goods.

259:

The Germans know about this. After WWI they had crushing debts, and they worked hard for low rewards. It made them strong. Joy Through Strength. Freedom Through Work. After WWII their economy was bombed to hell and gone but they worked hard for low rewards, and now they're in a position to pass it on and collect punitive reparations from other nations.

After WWI Germany had crushing debts, so they started WWII.
After WWII, most of the debt was cancelled and Germany got the Marshal Plan.

Please try to get your historic facts right and don't quote Nazi slogans like
Kraft durch Freude and Arbeit macht frei.

When other nations required Germany to pay, they didn't just complain and refuse. They fought very very hard and overcame their problems. They expect no less from Greece.

That's historically just wrong.

260:

After WWI Germany had crushing debts, so they started WWII.

Yes!

After WWII, most of the debt was cancelled and Germany got the Marshal Plan.

Yes. One interpretation was that the USA needed western europe rebuilt quickly to help fight off the USSR. But it took some years to get that organized, since there was a competing effort to keep Germany weak so they wouldn't start another world war.

Please try to get your historic facts right and don't quote Nazi slogans like Kraft durch Freude and Arbeit macht frei.

Aww, they just seemed to fit right in to reparations from Greece.

"When other nations required Germany to pay, they didn't just complain and refuse. They fought very very hard and overcame their problems. They expect no less from Greece."

That's historically just wrong.

Are you saying they didn't fight hard?

261:

A while back somebody around here got the bright idea to refer to children with learning disabilities as "special". Naturally, "special" became a withering insult among grade schoolers in short order. It's almost like they can see the reality of what's going on no matter how nicely adults phrase it or something.

262:

Are you saying they didn't fight hard?

Oh, Germans worked hard after WWII. They also took all the help they could get from the Allied and didn't pay much of their debt, see London Agreement on German External Debts.

263:

Oh, Germans worked hard after WWII. They also took all the help they could get from the Allied and didn't pay much of their debt

OK, so they fought WWII partly to avoid their debts, and then they arranged to mostly not pay the debts after WWII either.

Why would they respect people who don't make a great big effort not to avoid payment?

264:

Sorry, bad proofreading, there's an extra 'not' there.

265:

The Greek government has reformed, enough so that they are now running a small budget surplus, if you dont count the debt payments they owe. The only reason their current model of governance isnt considered sustainable is because of the level of debt they owe. The creditors feel they have the right to be paid- the other side of the argument is that it would serve the interests of European tax payers better if Greece received enough assistance to become a net value added to the EU, which at this point is a reasonable expectation. Just ask the IMF.

266:

It's Germans. Germans don't do respect. If you are lucky, they are polite.

In this case they argue about moral obligations to pay debt and sticking to rules when they should help Greece to get back on its feet and support the Syriza government to modernize the Greek administration (less corruption less red tape, clear rules).

Blackmailng the Greek with Grexit is a disgrace. Look at what the Allied offered the former enemy Germany at the conference in London 1953 and compare that with what the Germans now demand from Greece, a partner nation of the EU. With partners like that, who needs enemies?

267:

it would serve the interests of European tax payers better if Greece received enough assistance to become a net value added to the EU

That's relative. The German tax payers earned around €100 billion from the Greek crisis over the last years due to reduced interest rates.

268:

Look at what the Allied offered the former enemy Germany at the conference in London 1953 and compare that with what the Germans now demand from Greece, a partner nation of the EU. With partners like that, who needs enemies?

The allies at that time had the Soviet menace to consider, and could not afford a disaffected West Germany.

So maybe the EU needs an enemy like that, to hold together.

I don't think Russia is in shape to offer the right kind of deals, though of course discussion of Russian naval bases in Greece would make great headlines.

China is still too far away, basicly a very strong regional player this year.

The USA doesn't want to pose as the big bad enemy of the EU, though a certain amount of that is inevitable. So I can't see them giving Greece an alternative.

I like to imagine things like that. Some nation is having big difficulties and agrees to become a US territory. They start voting very year or two whether to leave the USA, apply for statehood, or keep the status quo. Make that approval voting so they won't get stuck without a majority like Panama.

With a somewhat different political climate in the USA that might be the best deal the West Bank or Gaza could get. It might have been good for Iraq or parts of Iraq. I can't really see it for Greece, but if things go strangely enough I could imagine it as not absolutely impossible.

269:

To the extent that anything is truly hand-stitched these days if not sourced with provenance...

Thematically similar (that's the Princess @ royal wedding in Luxembourg). White / Blue is very linked to colonial pasts, but hey.

Note: definitely from the colonial side rather than traditional ways. French influence of design (Fleur de Lys rather than tradtional), but: probably hand-stitched, but not by the highest level of fashion house.


All of which, of course, are just cover identities for the GCU Are we still using this joke?


I always preferred: Falling Outside The Normal Moral Constraints.

My hit rate is rather too high for your analysis btw. The bots go all squeeky when you markov them.


Regarding other things: host is on tour, no naughtiness or bullshit while he's busy since Better Things to Do [tm]. Promised and Marked.

270:

For myself personally, I tend to veer in agreement w/ Mr. Stross about this-- the Great Game in the 21st is played only by the powerful & the munchkins need not apply for entry. Much less hinder it in any way.

Another aspect of this is the United States' seemingly tunnel-visioned manic-drive to somehow counter the sheer heft of China. I believe this is overriding common sense here, but then other factors are as well, as I mentioned.

271:

Thematically similar (that's the Princess @ royal wedding in Luxembourg). White / Blue is very linked to colonial pasts, but hey.

I have shirts in black on grey, scarlet on black, white on red, and one or two other colours too. So they're not only white and blue. Why are those colours linked to colonial pasts? The photo shows details of more stitching, by the way.

This, from Yelp, is a photo of one of my local clothes shops, in Oxford's Cornmarket Street. Note the absence of colour, indeed an overwhelming and dreary dowdiness, as well as a lack of interesting detail in the clothes, all of which I presume are machine-made. So going back to J. Thomas's posting, my experience has been that human beings sitting at sewing machines can compete very well with machines. Admittedly, I'm arguing from a very small sample size.

272:

Because this looks like it could run and run otherwise:
There are no "machine-made" clothes to compete with; garment assembly is too complicated for current commercially available robots. DARPA funded research into robotic sewing machines in 2012, and the resulting robot's just about in alpha

273:

You contended people were attempting to stop the use of Third World because it was impolite; I pointed out they want to stop its use because it's incorrect. Your response appears to amount to "Yes, but people use it like it means that" to which I am now going to wearily point back at my first sentence.

274:

Your response appears to amount to "Yes, but people use it like it means that" to which I am now going to wearily point back at my first sentence.

You can wear yourself out talking about what words ought to mean, but it's unlikely to change their actual meanings in practice.

275:

Can't use "primitive" or "undeveloped" huh?
How about .. "backward" or "corrupt" then?
A few days back I cuaght a BBC "From our own correspondent" piece.
IIRC they were talking about Bamako, capital of Mali.
( But it may have been a n other francophone country in that area. )
Nothing works, or rather nothing works without greasing.
It's so bad that the tickets for the queue for the simple blood-samples at the local major hospital are sold in preference for an early test.
If the corruption is that pervasive & endemic, then nothing will ever work.
How did it start & more importantly, how does one stop it?
Because a country that far down the pan will have a very difficult job to ever pull itself up.

Note: As Charlie has commented, the "first" world has its corruption problems too, except that direct bribes are rarely (if ever) paid.
Or we have problems like the unelected (Irish in this case) EU commissioner I highlighted recently - ruling over us with no consent.
But "our" problems tend not to drain out any circulating wealth to the point that the system is so anaemic that it can't even stand, never mind walk.

276:

AV & JT
BOTH WRONG
After WWI the German reparation debts, plus other factors, led to the hyperinflation of 1923.
The debt was not paid off ( Or not in full, at any rate)
The Nazis came to power due to a combination of factors 1930-33 (Germany was one of the hardest-hit countries in "the great crash") & even then, it was initially because Hitler was seen as a convenient stooge, to be got rid of later - which didn't work out so well, did it?
After WWII there was a plan to reduce Germany to permanent third-world status, which was hastily reversed, when it quickly became apparent what Stalin was up to.
What really started the Wirtschaftswunder was the creation of the Deutsche Mark, 1948. ( Which also triggered the blockade & airlift of/to Berlin - which is another story )
The Marshall plan helped, too.

277:

It's Germans. Germans don't do respect. If you are lucky, they are polite.
If that was a non-European country, I'd call "racism".
It's also completely untrue.

278:

Now about the GCU
Not in front of the Children" ??

279:

Clothing.
Almost all clothing is made, at the final assembly stage by:
Hand-guiding a sewing machine over pre-cut segments.
Those pre-cut segments will often have been cut by an automated machine.
More expensive garments are often hand-cut, after very careful measurements being taken of the potential purchaser.
In-between you will get automated-cut segments, with greater margins on the pieces & better quality-control of both materials & assembly-tolerances.
Sewing decorations are easily done on semi-automated machines, these days, but usually still require a human to start/finish, insert/remove workpiece.

280:

AV & JT
BOTH WRONG

Everything you say here looks right to me, except for the part about saying that both the other stories are wrong. They both look right to me too.

Apart from a little bit of interpretation, all three stories look compatible to me.

281:

You're disagreeing with a German over the characteristics of his own nation? There's usually an out when commenting about one's own grouping.

282:

So going back to J. Thomas's posting, my experience has been that human beings sitting at sewing machines can compete very well with machines.

My point is that this is a dead-end job. It doesn't pay well and cannot pay well (with limited rare exceptions).

This is work that "developed" nations don't want. It might be some nation's comparative advantage, but it does not lead to "development", unless they carefully hoard the paltry foreign exchange it brings them and somehow use it for "development".

Here's a metaphor -- you have a large pond with fish in it. There are 1000 minnow-size fish, and 100 small fish, and 10 big fish, and one lunker. All the same species. They're talking fish. And the lunker tells the others, "Any of you could do what I've done. If I can do it, you can do it."

And he's right in principle, they all have basicly the same genes and they could all do that given the right chances. But they can't do it when there's already a lunker there. If the lunker disappeared then each of the 10 big fish might have a one tenth chance to take his place, and each of the hundred small fish would have a one hundredth chance to get big, and each of the thousand minnows would have a one thousandth chance to grow.

But not while he's there, grabbing the opportunities they'd need.

Senegal can't hope to follow the US development path and compete head-to-head with the USA, and Greece can't hope to compete head-to-head with Germany.

283:

Err, as Bellinghman already said AFAIK Andreas[1] is German, so that would be German self-hate. Except if he was Swiss or Austrian, though in the letter case I'd expect the colloquial Piefke.

Where, alas, said German self-hate is typically German and, contrary to popular belief, not only a abode of the political Left. Ever wondered why the Nazis[2] were so big on "Nordic"(e.g. Skandinavian) or "Aryan"(e.g. Central-Asian cattle-herders with Indian and Persian franchises)?

As for Germans and Greece, I guess it would be wise not to mistake Schäuble for "Germans", where the latter can have quite differing opinions. Yeah, I'm usually the last Keynesian standing in economic discussion, so I might be prejudiced...

[1] Err, not me, him. Technically, I'm also German, though having to spell your real surname all the time makes not for great self-identification. "Ja jestem chaupak popolski" or so...

[2] Godwin ahead.

284:

It's Germans. Germans don't do respect. If you are lucky, they are polite

I must be hugely lucky then, because pretty much every German (or even half-German) I know is at least 2 of polite, respectful and friendly towards me.

285:

Hehe, but I have inside knowledge!

But you are right, one shouldn't throw all members of a nation into the same pit (although that's not uncommon in Germany, either).

286:

I must be hugely lucky then, because pretty much every German (or even half-German) I know is at least 2 of polite, respectful and friendly towards me.

Germans in their natural habitat or abroad?

287:

Err, as Bellinghman already said AFAIK Andreas[1] is German, so that would be German self-hate.

No, I don't have self-hate, I just wish I wasn't German! :-)

288:

Greg has the more detailed version.

I still don't see how that history gives Germans the right to look down on Greek people.

289:

Germans in their natural habitat or abroad?

Both, with the note that I'll be respectful and polite to you unless you're disrespectful and rude to me, and that I do speak a little German, so will at least start conversations in German rather than expecting you to speak English because it's my native language.

290:

Eh, are you sure you're not British? Oh wait, we just get embarrassed at being British.

(My personal experience is that the Germans I've met, and those that are our friends, and even our daughter (long story, but these days we get Christmas cards from our grandchildren) are all nice people.)

From over here, I'd often rather be German than British.

291:

I still don't see how that history gives Germans the right to look down on Greek people.

I don't usually do rights, although sometimes I might.

I was thinking that it was plausible some of them might do that under the cicrumstances.

292:

I see that the EU prposed setting up permanent courts to handle corporate vs. country disputes. Basically throwing a bone to the overwhelming majority of people who reject the idea of corporate sovereignty. The US rejected it, because it would interfere with our national sovereignty. Wow. The US going for broke.

It certainly seems like the TTIP (and it's Asian/Pacific cousin the TPP) is basically a power grab by US neoconservatives. It's Ayn Rand as applied to international trade.

293:

I must be hugely lucky then, because pretty much every German (or even half-German) I know is at least 2 of polite, respectful and friendly towards me.

Same here. One thing I've noticed among my small sample is a tendency toward vociferous argument. The ones I know in person, given a disagreement about a matter of fact, just won't let go of it. They can go into impassioned argument easily. "... No! That's stupid because...."

The first time, each of them seemed to start kind of hesitant, like they expected me to get angry at them. When they saw I didn't take it personally and responded on the issues, they really let go and seemed to enjoy it.

That isn't all the Germans I've met, others were quite reserved. But each of these made a big deal of being German, so I noticed the pattern. I think maybe the Americans I meet tend to want to avoid anything that looks like confrontation. There's no point arguing because after all things will get decided elsewhere by somebody else and not on the issues. In any disagreement somebody might get upset, and there's some small possibility of a shooting or something. So people mostly like to be friendly and not bring up anything controversial, or if something does come up treat it as someone's "special interest". Joe does rockclimbing, Jerry flies ultralights, Bob is into police brutality, Sam likes Bernie Sanders, Harry is an anarchist capitalist, and Charlie bakes bread.

294:

"Ja jestem chaupak popolski"

"I am ..."? What are the other two words?

295:

Rights:
"You don't have the Right to..."
"I don't need no stinkin Rights, because I Just Do It and you can't stop me!"

296:

My point is that this [sewing] is a dead-end job. It doesn't pay well and cannot pay well (with limited rare exceptions).

The same could be said of lots of jobs I know in the UK: barista, waiter, cleaner, shop assistant. The baristas at my local Costa earn between £6 to £7 an hour. Should we therefore get rid of those jobs? (Actually, I'd like to, as soon as the automation becomes available. I don't believe anyone should have to do a job that bores them. Life is too precious. But that's not the topic of this discussion.)

Your paragraph above was about the disadvantages of a sewing job to the person doing it, as I understand it. The rest of your comment — the metaphor of the little fishes and the lunker — I interpret as being about the job's disadvantages not to that person but to their country. And I assumed it would still be about sewing jobs. But when you talk about e.g. Senegal not being able to compete with the USA, aren't you implying that the Senegalese should not take jobs in car making, aviation, films, software, and so on? Surely those are what made the USA a lunker?

And if that's so, what's left for Senegal, Greece, and the others?

297:

Interesting that you come up with the construction personality bit. Catinadiamond is part of the title of a book, cat in a diamond dazzle. That books belongs to a series of detectivish books written by Carole Nelson Douglas.

A carefully picked line from an amazon review to fire up the imagination:
While her prose and plotting are sometimes overwrought, Douglas (Cat in a Crimson Haze) tells her tale with such good humor that readers are likely to forgive her the occasional excess.

Think about it, someone used to making up personalities in books is bored and finds antipope to test out some ideas. Create some person and see what happens. It must be her!! Or, alternatively, someone in the looney bin has internet access.

298:

Dang! I was so sure that CiaD referred to this dead pet story.

299:

One thing I've noticed among my small sample is a tendency toward vociferous argument.

We have a saying: "Der liebe Gott weiß alles, aber ich weiß alles besser!"

(The almighty is all-knowing, but I am know-it-all)

300:

"Ja jestem chaupak popolski"

OK, got it, I think. "Ja jestem" = "I am" in Polish. And I've just realised that "popolski" is not the name "Popolski" as I first thought, it's a typo for "po Polsku", meaning "in Polish".

Therefore "Ja jestem chaupak popolski" means "I am <chaupak> in Polish".

Your name Trottelreiner means something like "pure fool" or "clean fool" in German. (Many beer lovers will be aware of the German Reinheitsgebot or beer purity law.) A quick Google tells me that there was a Professor Trottelreiner in Stanisław Lem's The Futurological Congress. I can't remember much of the story, but it's possible that that Trottelreiner could have been a literary foil, which would be consistent with that meaning.

So by elimination, "chaupak" ought to be Polish for "fool". I don't really know much Polish, I'm just working on a generalised experience of Slavic languages. But playing around with Google Translate, there's a Polish word "głupiec" which has roughly the same consonant-vowel pattern as "chaupak", if you pronounce the latter as a German would. In the International Phonetic Alphabet, it's [ˈɡwupʲjɛʦ̑], apparently.

And I also find that "głupiec" is The Fool in Tarot.

So Trottelreiner, are you The Fool?

301:

More likely to be that well-known "Slavic" character - the holy fool, as best characterised in the opera Boris Gudonov ....

302:

"My point is that this [sewing] is a dead-end job. It doesn't pay well and cannot pay well (with limited rare exceptions)."

The same could be said of lots of jobs I know in the UK: barista, waiter, cleaner, shop assistant. The baristas at my local Costa earn between £6 to £7 an hour. Should we therefore get rid of those jobs?

No, but don't have any great expectations for them. The textile industry is not going to do much to bring a nation into the first world.

But when you talk about e.g. Senegal not being able to compete with the USA, aren't you implying that the Senegalese should not take jobs in car making, aviation, films, software, and so on? Surely those are what made the USA a lunker?

Yes. And there's only room in the world economy for one lunker. Maybe China will take that position away from the USA, but there's still basicly be just one.

If it was fair, anybody could be successful with hard work and clear thinking. But the economy doesn't work that way. We'd like to think there's a pathway for development, that any nation could follow and be successful. But there isn't, for members of a global market.

The first nation to do some new technology has a chance to see how to make it work -- build it, market it, finance it, etc. Somebody who wants to copy them is starting out at a big disadvantage. They are low on the learning curve, and they must compete with somebody who's solidly established. Patents, distribution chains, mutual favors, lobbyists -- it's hard to break even with a late start unless you can get captive markets. The other guy *does* have captive markets, and he will do whatever he can to stop you from getting your own.

There is no development path!

There was the path that the pioneers too, by trial and error. They don't know how anybody can make a new path in a world which has them in it, any more than you do. If they knew how, they'd try to make sure it stopped working.

And if that's so, what's left for Senegal, Greece, and the others?

I don't know. That's the problem.

What should you do when you need the world economy a whole lot more than the world economy needs you?

Of course you can't make a lot of money unless you have a lot of capital. It takes money to make money. There are institutions and governments that will give an "underdeveloped" nation's government lots of advice about how to "develop", and then give out loans to help them follow the advice. Then when it doesn't work and the loans come due....


303:

Nice reasoning. And actually, I'm always the fool, though I guess the Jiddish word "schlemiel" is a better, though not that culturally appropriative description.

Actually, I chose "Trottelreiner" as a pseudonym on a mailing list some time ago, since the discussion was somewhat on, err, medicinal and recreational psychopharmacology.

My real surname is not that German, though there are only 3 consonants directly connected, which AFAIK is less than normal for Polish. As I use to say, fine old Ruhr name. ;)

Actually, AFAIK it's one of the usual Polish patronyms and, again AFAIK translates more or less to "son of (name of some small villages/towns east of Warsaw)". Problem is, it's even not that common in Poland, and in Germany there are even less, and most of those I'm directly related with. One might not care that much for oneself, but lately I've grown somewhat more careful online. And my brother is in politi..., err, sorry, a teacher.

As for the sentence, I blame my dismal Polish grammar and bad phonetic transcription. "chaupak" in fact was "chłopak", the ł is pronounced somewhat like "w", IIRC, which might explain my bad transcription. For the grammar, well, of course the translation for "Polish" would be polski, but the adverbial form is "po polsku", and I just added the usual -i for nom. sing. masc. So actually, I meant "ja jestem chłopak polski" (="I am a Polish boy") or "ja jestem po pulska" (="I am Polish"), which is my way of dealing with the German auto-dislike Andreas Vox mentioned. And is also a nice sentence my brother and me use to entertain our father or used for our paternal aunt, of course without the mistakes. Though since their experience is/was about 50 years ago with my grandparents, who knows.

As for actual knowledge of Polish history, I lately had to explain to them that some figurines of winged hussars were not Native American warriors. Maybe have to play some Civ5 with my brother.

Sorry for the digression, back to text.

304:

There is a path for development, although it isnt simple. It involves capturing foreign capital and investing it in local production capacity. One significant barrier is that foreign capital doesnt want to be captured- the people who control that capital want to control the terms and conditions of the investment, after all it is their money. The problem with that is overseas investors wont have the knowledge of local conditions that a native entrepreneur would have: the so-called "Local Knowledge Problem". But the flip side is that local investors very frequently do not have national development as a high priority- their just pursuing their own interests, often at the expense of their own neighbors. What's needed is a local-based neutral party who can advise foreign investors on where the real opportunities are. Development starts with a locally-based non-profit community bank.

305:

Of course, possibly the most famous Cat in a Diamond is a big cat, not a domestic one, and plays starring roles in several Blake Edwards films, not to mention having a cartoon series to call its own.

306:

There is a path for development, although it isnt simple. It involves capturing foreign capital and investing it in local production capacity.

I certainly don't want to say it's impossible. There are examples of nations that do well and others that do badly, and we could discuss the reasons for each. But it seems to me that what success *means* involves finding metaphorical ecological niches where local production can compete effectively. It is not enough to invest locally, the investments must be profitable.

I suspect that some apparent successes involve a sort of ponzi approach. Start with a population that firmly holds the ideals of hard work, frugal spending, and heavy savings and investment. They generate lots of investment money, which gets put into profitable businesses, resulting in more investment money.

At some point there are no more businesses to invest in with the traditional profit levels, but they must still invest and choose businesses that show promise of becoming very profitable. As those start to fail, investors look around and see that much of their savings has evaporated and they get discouraged. The local economy slumps and waits for some kind of opportunity. Without this economy aggressively looking for raw materials and international business opportunities, there's more room for others to go through the same process.

307:

Tianjin


Something something supercomputers something something.


Boom Badda Boom


And yes, if you've watched it all - there's a video where you see the slight reflection of the person's face as they take the video... as the shockwave rolls in and they die.

Not Nice.

308:

Another possibility. Nice find!

309:

A point about development. From a developed country's perspective, most developing countries look the same. However, an economy caught in the middle income trap would be a huge jump in the standard of living for many countries (which I think hold half the human population). And then there's the fact that Poland and the Baltic States are developed countries at the boundary of developed and developing. Even if China and a host of aspiring middle income countries such as Turkey, Panama, Gabon, and Costa Rica don't become as wealthy as Western European countries on a GDP (PPP) per capita basis, a Baltic standard of living would be worth it.

What I'm trying to get at here is that some commentators are judging this current development on an all-or-nothing basis, where it is a failure if developing countries don't achieve parity.

310:

I think that the debate on whether the only legitimate jobs are those that are fulfilling is missing the following point: if we limited our economy to fulfilling jobs, then unemployment would be about 90%. Few jobs are actually fulfilling in that nearly all have a boring repetititve part and all have internal politics that can't be ignored.

As for the sewing jobs, I don't know enough to judge their necessity. However, I have two observations

1) In the 2000's, China focused on attracting cheap manufacturing jobs such as sewing jobs while India focused on attracting cheap service sector jobs such as call centers. Note that this isn't exclusive. Yes India did attract some manufacturing jobs while China attracted service sector jobs. However, the trend is the trend. So far we've seen China's approach to work better.

2) Bangladesh and Cambodia have attracted cheap sewing jobs since at least 2008. It's almost 7 years later and their living standards have barely improved. Compare this with China which started attracting manufacturing jobs en masse from 1997 and by 2006 was beginning to crack down on sweatshops, at least in the coastal cities.

I've drawn several contradictory conclusions from this observation.

1) Cheap manufacturing jobs are a necessity for development

2) We don't know if the cheap service sector method works. Perhaps India just screwed it up?

3) Manufacturing jobs couldn't be outsourced en masse without an internet to handle logistics. Perhaps India's method requires a similar technological innovation?

4) There's a market saturation point for cheap disposable workers, which we've reached. At this point, it's just a zero sum game unless we can export another industry.

5) How much of the lost jobs due to outsourcing were in fact lost to automation? Perhaps outsourcing wasn't as important for development as economists think?

6) The development path works, just more slowly due to the global recession.

7) China's method of providing goods such as cell phones at the price people living in rural areas and slums could afford represents another development path that doesn't require outsourcing as much as the old model did.

8) Automation would put a stop to development by removing the "middle" manufacturing jobs. You know, the ones which require less capital and skill than making a car or a microchip, but more than a sweatshop

311:

The textile industry is not going to do much to bring a nation into the first world.
Really?
It was a prime reason for the first development of the first industrial revolution.
Once the Watt/Boulton improvements in fixed steam power came on stream, machine weaving & mass textile production drove huge expansion of Britain's material wealth & development approx 1780 - 1815.
Whether that could happen again is extremely doubtful, though.

312:

We don't know if the cheap service sector method works. Perhaps India just screwed it up?

Some times a call center just doesn't work if it isn't in the "local" culture. A major US airline tried to move some of their call center staffing to India. Luggage I think. Just didn't work. Person at the call center needs to understand what "go to Walmart/Target/Sears" for some cheap clothes means and that Chicago was pricier than Mobile AL. And that NYC doesn't have all night Walmarts. And dozens of such things. My wife has worked at a major airline call center. Luggage for several years of her 18 year stint. It requires a lot of local (country) knowledge. Calls to them from outside the US were a tough even if the other end spoke English.

There's a fellow over hear that has been here for 15 years after living his first 30 to 40 years in England. He said the other day he was just beginning to not hear things every few minutes that just didn't make sense.

Add to that the concept of not saying no that some cultures have depending on status and gender or they just don't do it and some kinds of call centers can be hard to export.

314:

My point is that sewing machinist is a dead-end job. It doesn't pay well and cannot pay well (with limited rare exceptions).

Really? One of those jobs in, say, Senegal, pays well enough for the family to put 2 children through university locally, so it can create an MD and an engineer and if they stay locally that raises living standards in the population as a whole.

315:

"My point is that sewing machinist is a dead-end job. It doesn't pay well and cannot pay well (with limited rare exceptions)."

Really? One of those jobs in, say, Senegal, pays well enough for the family to put 2 children through university locally

That suggests that I'm wrong. I hate it when that happens.

316:

There's another difference between Chinese and Cambodian era cheap sewing; the supply chain has gone totally non-linear. Factories at the start of the 'Chinese' era got relatively long-term contracts, which allowed them to plan; 'Cambodian' era factories might well not know what (if anything) they'll be making at the end of the week.

317:

Holy Fools are more of an Orthodox thing than a "Slavic" thing. Though St. Francis and many of his imitators might have been labelled that if they were from the East.

318:

"But it seems to me that what success *means* involves finding metaphorical ecological niches where local production can compete effectively. It is not enough to invest locally, the investments must be profitable."

Typically, local consumer needs are being poorly me in developing economies. It's not that the demand isnt there, it's that no one is providing a supply. Another barrier is that there is a minimum critical mass one needs to jumpstart an economy- one business cannot survive on the spending power of it's own employees alone- and international aid efforts seldom try to implement these kind of things on a comprehensive scale. You literally have to saturate a local market with enough earning power to get the supply and demand thing going. It doesnt take much by developed nations standards- the local cost of living will still remain low. But it would take a community-wide, coordinated effort by multiple NGO's.

319:

Another barrier is that there is a minimum critical mass one needs to jumpstart an economy- one business cannot survive on the spending power of it's own employees alone- and international aid efforts seldom try to implement these kind of things on a comprehensive scale.

If they must pay for patents, imports, imported raw materials, imported management, profits to foreign owners etc, then they need exports to pay for all that. They must compete on the international market.

It's not so easy to break into foreign markets, even when the trade is officially "free".

If one business can't survive on the spending power if its own employees, ten businesses can't survive on the spending power of their employees and ten thousand businesses can't survive on the spending power of their employees. Something else has to happen.

320:

"If they must pay for patents, imports, imported raw materials, imported management, profits to foreign owners etc, then they need exports to pay for all that. They must compete on the international market."

I guess I didnt make myself clear. I was responding to your statement that there is no path to development, and you didnt know what to do about that. I'm pointing out what I believe is a path to development, but it emphasizes local development over international trade relations. A developing local economy may have to be protected from foreign competition for a period of time until it has achieved a degree of sustainability first. This may be as simple as not insisting that they make a profit in global markets.

321:

I'm pointing out what I believe is a path to development, but it emphasizes local development over international trade relations. A developing local economy may have to be protected from foreign competition for a period of time until it has achieved a degree of sustainability first. This may be as simple as not insisting that they make a profit in global markets.

I think something like that is necessary, and it may be hard to achieve. Local economies have trouble "developing" without foreign investment. Examples of places which have tried that include Albania, China, and some others, none of them particularly successful. Also if you abide by various international agreements then you must honor patents etc, which is another foreign exchange drain.

The easy way is to welcome international corporations to set up in your nation. They will bring the patents, the know-how, the technicians, the management, and the capital, and they will build. But they will regard what they have built as theirs, and they will resent you like a landlord. If you interfere with them even to the extent of environmental or workplace safety regulations they will look for a more congenial location.

So you try to build your own local economy, and then the USA comes after you. They point out that your local industries are inefficient and cannot compete, that your people suffer from badly-designed, expensive products. They encourage your military to overthrow you. They do their best to help opposition political parties take over. Not unlikely they start declaring sanctions -- which severely inconveniences your rich people who like to go to Paris etc and spend money.

I think something like your idea is necessary, but it isn't as simple as "not insisting that they make a profit in global markets."

Still, it's an important part of the puzzle.

322:

I'm pointing out what I believe is a path to development

The approach that has worked in the past was to sell locally-produced goods to foreigners, invest the proceeds in capital and skills, and use the investments to produce better stuff for sale to foreigners. The pattern would then continue until your stuff was as good as the developed countries' product.

In the last half century, more and more countries have invested in capital and skills. Naturally, this has made capital and skills less valuable; it's simple supply and demand. Each investment pays off slowly than the last, and more and more investments never pay off at all.

There may be a path to development, but it's gotten much steeper. Beyond a certain point, the path starts to look very much like a wall.

323:

I think we are working toward a consensus here.

"Local economies have trouble "developing" without foreign investment."

That's true, and what's needed therefore is a source of foreign capital that doesnt insist on making a profit right away (or at all). Pretty much that has to come from international government aid, or else NGO's. That's why I said it probably has to start with non-profit community banks, except on a much larger scale than has been tried up to now.

"Also if you abide by various international agreements then you must honor patents etc, which is another foreign exchange drain."

I admit that this is an area that I dont know that much about. I wonder just how much productivity is lost due to foreign patent holders insisting on some sort of payment? If it's a problem, then international law may have to be adjusted to protect the poorer countries- after the whole point is they arent competitive globally, so it's not like they are in a position to steal business away from anyone.

"So you try to build your own local economy, and then the USA comes after you. They point out that your local industries are inefficient and cannot compete, that your people suffer from badly-designed, expensive products."

Which brings us back on topic, because that's basically what the TPP is designed to facilitate. But that isnt fundamentally an economic problem- it's a political one, which requires a political solution (maybe taking it to the streets).

What Jay is pointing out is a different sort of problem altogether, and one I hadn't considered before. Shouldn't innovation provide a solution to that? If potential knowledge is infinite, then there should be plenty of room in solution space for every country in the world to specialize in some way unique to themselves. Of course that's an ideal.

324:

Potential knowledge might be infinite (your guess is as good as mine), but the vast majority of it is irrelevant to satisfying the needs of hairless apes. Knowledge that generates a return on investment is a trickier proposition, judging from the complaints of overeducated, underemployed millenials.

Think about web videos on Youtube channels. An incredible amount of time and effort goes into them, people watch them, and they make money. However, for all but a few people, the income barely covers the costs (if that). Making videos (or breeding dogs, or painting pictures, or making handcrafted pottery, etc.) is more along the lines of a hobby than a business because people aren't willing to pay a livable wage for the products. Any business model that strays too far from satisfying basic human needs tends to run into this problem.

325:

What Jay is pointing out is a different sort of problem altogether, and one I hadn't considered before. Shouldn't innovation provide a solution to that? If potential knowledge is infinite, then there should be plenty of room in solution space for every country in the world to specialize in some way unique to themselves. Of course that's an ideal.

The amount of knowledge on person can have and use sharply constrains how much any one person can do and also how you can organize groups of people to accomplish thing beyond the ability of an individual.

We are, as a species, really good at this, but cities are an environment and agriculture is an environment and we're not done adjusting to those yet. We'll likely get better.

One thing we do know is that you can have success or you can have control. You can model the progress of civilization as prying basic primate status need off control (things get better!) collapsing into control (there's all this stuff that can enhance my status!) whether you want to cite Plato's expectations about political evolution or the career of Dick Cheney. (Civilization works by giving up the direct benefits in return for the indirect ones, which turn out to be greater as long as everyone does it.)

None of this will provide the import replacement necessary to development; that tends to require something that is, or functions as, a tariff barrier. (US in the 19th; Japan and Korea's closed internal markets, etc.) The neo-liberal consensus to forbid tariff barriers -- forced market access -- is functionally a commitment to preventing development. (Development and hosting factories are different things. Jobs, sure, but are you seeing an increase in the breadth of available skills and secondary manufacturing in your local economy? No? You're hosting a factory. It won't do you much good in the long term; you're being mined for labour instead of a mineral, is all.)

Actual development is hard; you need a functioning city, with the civic, legal, transportation, and financial armatures all working, to support the necessary variety and density of skills; you need an opportunity for import replacement (that is, there's already trade with another functioning city economy somewhere); and you need to be able to defend yourself from attempts to appropriate the entirety of the surplus you've started producing.

None of those are easy. There are powerful forces actively working against all of them everywhere, so they're by no means guaranteed to continue once you've got them.

326:

Jay, you appear to be arguing that there are only a limited number of ways to satisfy basic human needs, and that we are coming up against this limit. If so, that's a new argument I haven't encountered before.

If that's not what you meant, then just ignore what follows; but if it is, then I'm not sure I can agree. I think "human needs" are for the most part undefined (did anyone "need" air conditioning before it was invented?). Or rather I suppose the need is fairly well defined (people are hot), but there exist an undefined number of ways to satisfy those kinds of needs. As the population of the Earth grows, and the social relationships between them become more complex, and the amount of cash flowing through the system increases, and barriers to communication and transportation fall, opportunities to find and produce new ways of satisfying people also increase. It's a self-perpetuating process, has been since the Ice Ages. What is different now that prevents production specialization from continuing to increase?

Of course it's not a smooth process. And not everyone is equally positioned to take advantage of it. New technologies are invented, and suddenly people compete with each other trying to find ways to exploit it. You have to be quick and smart to win at that game. And have access to some capital. But the only part of that equation people in the developing world systematically lack is the capital. I think that's a problem with a discernible solution.

327:


"Also if you abide by various international agreements then you must honor patents etc, which is another foreign exchange drain."

I admit that this is an area that I dont know that much about. I wonder just how much productivity is lost due to foreign patent holders insisting on some sort of payment?

I don't know how much of a problem it is internationally. It's often a great big drain inside the USA.

This link says about what I wanted to say about that. It doesn't prove its claims but it does say them clearly.

http://www.forbes.com/sites/toddhixon/2013/10/04/for-most-small-companies-patents-are-just-about-worthless/

If potential knowledge is infinite, then there should be plenty of room in solution space for every country in the world to specialize in some way unique to themselves.

To the extent that works, it could be a long-term solution. Of course, there are obstacles. In a world with unlimited AI available for marketing, whenever a customer wants a product, there could be several competing custom designs for him alone. The designs would be informed both by the designs that others liked for similar products, and by that customer's complete history of buying choices for other products. But since in practice we do have limits on the amount of design work we can do....

In any ecosystem there are limits to diversity. Some ecosystems have many more species than others, and ecologists argue about the reasons. Arctic ecosystems tend to have pretty large numbers of a few species, rain forests have small numbers of a great many. Deserts have rather small numbers of not very many, etc. There will be some sort of limit to the number of economic products too.

Maybe more important, it takes a certain amount of capital and "leisure" to create new products, and if you have to have it before you can get it, that's trouble.

We might do better without patents. Encourage everybody to share technology, and if a poor nation uses a hundred thousand ideas and produces a hundred new useful ones, the world is better off by a hundred useful ideas. But the way it is now, big companies tend to share patents with each other but not with anybody else.

328:

Greydon, I think I agree with pretty much everything you say. Again, the barriers you point out are not economic problems, they are political problems that require political solutions. That just requires the mobilization of mass opinion, in the developing world and here in the developed one. Not easy, but we've done it before.

329:

Ecology and the economy have many parallels. Diversity seems to have a limit- at any one point in time. Both have been developing ever greater levels of diversity, with no ultimate theoretical limit that I know of. As you say, this is a long term trend, and the path to development may be a long term process. But I think that's ok. People have been poor for a very long time. If it takes a few generations to liberate them, I think we can deal with that.

330:

Ahh, you're showing your ignorance.

Out of 6 (now 19) decent feeds, the one I chose was the one very, very close to the blast where the shock-wave absolutely does kill the camera man.

If you want to argue about shockwaves and debris, take it up with "why we airburst nuclear weapons to get a rebound shockwave off the earth for maximal damage" military doctrine, circa 1944.

It's 100% doctrine to air-burst nukes to do this.


The radiation was always an annoyance in nuclear terms and so you had the Tsar bomb with a lead cap that was the cleanest ever tested or the move to neutron high-decay models where the infrastructure was ok after a few years.


~


Anyhow, no-one has picked up the why, even when it was spelt out.


It's about the Super Computers.

>>

Null Trace

Guardian reports "Shipment of ammunition" the cause

Trace >>

Shipping manifests

Trace >>

Who sold what and when to whom

Trace >>

It's all binary

Trace >>

Ammunition manufacturing factory, quality control, controls therein.


Would you like to play a game? [Youtube: film: 2:37]

But hey.


Pink Panther!

331:

Or, in laypersons' terms:

Stuxnet targeted vibration in centrifuges.

Spiking quality controls for a down-range effect is rather more simple. You could probably also jig crane software to make it drop things...

~


If you're still worried about the name, it's not any of the above. But the Cat came Back [YouTube: cartoon: 7:41]


Not that, either. The truth is probably a lot less palatable.

332:

It's not that there are a limited number of ways to satisfy human needs. It's that the best few ways tend to displace the others. Smartphones displace landlines, streaming displaces DVD rental, cars displace horses.

If you invent a new air conditioner (to use your example), one of three things will happen. If it's better than the old one (by whatever criteria a significant fraction of air conditioner customers use), then you get the business and the incumbents lose the business. If it's always worse than the older technology, we put it on the pile of patents that were never commercially viable (98% of all patents issued wind up in that pile). Alternately, the invention may be useful for a tiny niche of customers, and you get a modest business with no real growth potential (a "lifestyle business").

Since most customers use cost as a major criterion, the tendency is for prices to fall as the process iterates. Therefore, the ability to recover the initial investment and make the next investment tends to fall over time.

333:

As a rule of thumb, small nukes kill by radiation dispersal. Medium-sized nukes kill with the shockwave. The largest nukes are best thought of as wide-area incendiaries.

334:

That was just a quick answer on a physics group to a question about lethality of shock waves. Which also suggest that Chinese explosion was a lot more than 27 tonnes of HE alone.

335:

The 20-something tonnes of TNT reference for the Tianjin explosions is misleading but it's a number that can be referenced from somewhere authoritative. It actually came from a seisomological monitoring station in Beijing and was based on the measured result of the blast as if it had been a nuke (since that's what the seismo people were looking for from any possible North Korean nuke test).

I don't know how many tonnes of chemical explosives and other high-energy compounds actually burned in the series of explosions that did the damage in Tianjin but it was probably a lot more than 20 tonnes, just spread over a longer period than a nuke-equivalent. How fast an explosive burns defines any shockwave produced -- TNT isn't actually a high explosive, it's usually classed as a medium explosive used in quarrying and demolition, tearing rock and concrete by pressure rather than a high-velocity shockwave. HE has accelerants like aluminium powder added that make things happen faster, not an advantage for most commercial explosives or high-energy chemical compounds like potassium nitrate.

A nuclear explosion is not chemically driven and not limited by the speed of compression (aka speed of sound) to propagate through the "explosive". It's much MUCH faster. The TNT-equivalent is somewhat misleading but it's something mere humans can relate to -- for example the Tokyo firebombing raid in Japan in March 1945 did about as much physical damage as the 20-kilotonne Hiroshima nuke dropped six months later but the Tokyo raid only used about 1600 tonnes of bombs and much of that drop weight was non-explosive bomb casings.

336:

And there was the Buncefield explosion near here a decade back. The HSE report on that includes figures ranging from 7.5 tonnes TNT equivalent to 105-250 tonnes, depending on where you measured it. The explosion itself was estimated at 120,000m2 (that's about 400 metres across). The higher figure is because of the damage at multi-kilometre distances, whereas the lower figure is what would cause the damage within the immediate area.

All of which goes to show that TNT equivalence is a rough scale, and that a quarter million cubic metres of roughly mixed fuel-air behaves differently from a neat stack of solid explosive.

337:

The duration of the over pressure is a major factor in destructiveness.

338:

If that's generally true, then how does the economy grow?

339:

It's not that there are a limited number of ways to satisfy human needs. It's that the best few ways tend to displace the others.

So there's a tendency toward "winner take all". We don't have a hundred thousand inventors puttering in their garages because if one of them becomes a billionaire and the others get nothing, it's a mug's game.

Also economy of scale gets important. If you want to make a lot of somethings out of plastic, and polyethylene will do, you'll probably make it out of polyethylene because we make so much of it that it's cheap. There are a few plastics that are cheap due to scale, and if none of them will do then you're into specialty products.

If you want software that can run on a PC, you'll probably run it on a PC unless there are big advantages to specialized hardware. If you want a microcontroller you'll go with one of a few cheap ones unless none of them are up to the job. Since lots of people are already familiar with those same systems, there's less overhead that way too.

Sometimes the "best" way is best because it fits into the flow. Lots of people do it so that makes it easier and cheaper. Some other way might be better on all other counts, and the cost of switching might be amortized in a few months if everybody just did it, but they don't.

There are various tendencies to winner-take-all. Not least is that capital of most kinds tends to flow to the places where growth is fastest. People who are interested in computer revolutions tend to go to silicon valley. They could communicate with each other from anywhere, but they don't. If Albania had their share of world-class computer experts, they might create their share of computer innovations and get their share of patents etc. But they don't.

Since most customers use cost as a major criterion, the tendency is for prices to fall as the process iterates.

Yes. As an industry matures, prices fall. The incentive for new innovation becomes less -- people know what they expect, and they want it cheaper not so much better. I recently saw Bluetooth earphones selling for under $10. Standard cheap products get dominated by a few big sellers. Is it economy of scale? Are they best at dominating distribution chains? Best at lobbying? Best at advertising and brand recognition? Various possible reasons.

Therefore, the ability to recover the initial investment and make the next investment tends to fall over time.

Under some circumstances there's plenty of investment money. When profits are high, and part of the population has more money than they want to spend on consumption, why not? They don't invest in mature industries. But when there is too much investment money chasing too few bona fide opportunities, a lot of it goes into bubbles and ponzi schemes. So if you choose right you can win big, but the odds go down. (Also if you go into a bubble and get out soon enough.)

It seems like there should be a gigantic opportunity in there somewhere, but somehow I don't see it.

340:

I wonder just how much productivity is lost due to foreign patent holders insisting on some sort of payment?

Here are two examples in different directions. DVD players existed in their prime in 2 tiers. Sony and similar commanded prices double or triple that of the cheaper stuff. Everything I read was that the cheaper stuff just didn't pay patent royalties. That was not a all the difference but in general it was a big issue in terms of pricing to the consumer. From what I read the mostly Asia makers of the no patent products kept changing locations, brands, and such that by the time they went after one of them there was basically nothing there. (USA view point.)

Then there are drugs. Drug companies go protect their patents in ways that make the Secret Service protection of the President look trivial.

341:

We don't have a hundred thousand inventors puttering in their garages because if one of them becomes a billionaire and the others get nothing, it's a mug's game.

Actually, if you've ever been to the Bay Area of California, you'll find that there are millions of people playing that mug's game. It's an immense waste of money and talent, but it's happening.

@DeMarquis: First world economies tend to grow through quality improvements (landline -> cell phone -> smartphone) and luxury goods. For the developing countries that we've been discussing, that path is not accessible. Uganda can't make a sportscar or cellphone that anyone would buy. Also, even in the first world, quality tends to be subject to diminishing returns. The jump from iPhone 4 to iPhone 5 is not nearly as significant as the jump from no phone at all to landline.

342:

It seems like there should be a gigantic opportunity in there somewhere, but somehow I don't see it.

That's because you're a good person, and the gigantic opportunity is for Ponzi schemers.

343:

"It seems like there should be a gigantic opportunity in there somewhere, but somehow I don't see it."

That's because you're a good person, and the gigantic opportunity is for Ponzi schemers.

That isn't what I mean. We have a whole lot of resources that people want to put into innovation, but the rewards mostly aren't there.

And we have a whole lot of people who need stuff they can't get because they're poor.

And we have a lot of businesses that would produce more if there was a market, but there aren't enough buyers.

It just seems like if there was a way to estimate the right amount of new investment, and then channel the rest of the resources into consumption and no-innovation investment to increase maximum production.

It just seems wasteful when some of us are gambling on bubbles -- a negative-sum game -- while others do without and people who could be working can't get jobs. There ought to be a way to improve the system and make a great big profit doing it.

344:

From the tech industry's perspective, the solution to the problem mentioned by J Thomas in 337 has been to miniaturize the device. The trend has been the following: a device becomes good enough when it's equivalent to a 2003 commercial laptop. So when laptops reached that plateau in 2003, the industry moved to smartphones and tablets. When smartphones and tablets reached that equivalency in 2013, the industry began moving towards smartwatches and the internet of things. Time will tell whether this will be successful. This brings up to mind Hugh Hancock's post here a while back on the future of storytelling.

One thing being overlooked for developing countries is a parallel set of inventions. The Chinese idea of selling smartphones cheap enough for poor villagers and slum dwellers to afford is creating a sort of startup market for apps that provide similar functions to western institutions, companies, and apps, but are optimized for the environment that the customers live in. This is a silent contributor to growth in developing countries. Growth here even concentrates in the poorer developing countries, because the richer ones already have some of the infrastructure in place.

345:

> The 20-something tonnes of TNT reference for the Tianjin explosions is misleading but it's a number that can be referenced from somewhere authoritative.

The Skybox satellite image shows roof damage but not collapse on buildings 400 or so meters from the explosion site. Taking that as indicative of 0.5 - 1.0 PSI overpressure, http://meyerweb.com/eric/tools/gmap/hydesim.html indicates that 20-30 tonnes TNT equivalent is in the ballpark.

346:

It's winner take all (sometimes) at the top of the food chain, but remember that one successful entrepreneur can provide gainful employment for thousands of people. Many of them his former competitors.

As for Uganda and sportcars, the thing is no one in Uganda needs a sports car (except for one or two ultrarich). The rest of them need affordable cooking and refrigeration appliances, small tractors, practical clothing. There are opportunities in the local market, if the capital could be found and competition could be kept out.

To find opportunities for import substitution, you need to find items that can be produced locally for less than the cost of international transportation. That means utilizing a local material resource. Food is the poster child for this, but there are usually also other possibilities, depending on the circumstances. The optimized cell phones and apps that loan mentioned are another one. But import substitution of this kind is not the only approach available.

Local innovation is the other one- someone inventing something that only the locals would want. We don't need mosquito netting made from organic fibers in the West, but they could use that in Uganda.

Really, I think we can leave the problem of innovation to the locals themselves. People are smart, they're usually pretty good at figuring out what the opportunities are. What we can do to help them is provide the capital and pressure their governments to invest in the public infrastructure that will support expanded economic activity.

"It just seems like if there was a way to estimate the right amount of new investment, and then channel the rest of the resources into consumption and no-innovation investment to increase maximum production."

What you are point out, J Thomas, is the failure of the marketplace to provide everyone with perfect information in real time. It seems that there should be a solution involving public databases of available skills and resources that people could use to conduct exchanges that wouldnt happen otherwise. There's been some activity in this direction, but it's been sporadic and small-scale, like the experiments with community banks. Dammit, we need an economy we can experiment on!

347:

I think what you're reaching toward is a New Deal-style system. It's not a bad plan (actually I'm in favor of it), but it wouldn't be as effective as it was in the 1930s. The value of labor relative to capital and raw materials has shrunk since then, so a new Works Progress Administration or Civilian Conservation Corps would find a smaller fraction of its budget going to payroll than the old ones.

348:

It's winner take all (sometimes) at the top of the food chain, but remember that one successful entrepreneur can provide gainful employment for thousands of people. Many of them his former competitors.

Yes, provided he doesn't find it expedient to automate too much. It doesn't take nearly 60 million workers to keep 120 million people in a US middle-class lifestyle.

To find opportunities for import substitution, you need to find items that can be produced locally for less than the cost of international transportation.

One of the big things about container ships is that for many products ocean transport has become cheap. Partly that it's so cheap and easy to load and unload cargo, and also pilferage is much reduced.

I think we can leave the problem of innovation to the locals themselves. .... What we can do to help them is provide the capital and pressure their governments to invest in the public infrastructure that will support expanded economic activity.

Also, try to stop the spooks from sabotaging them. Try to avoid holding them to international agreements that will cripple their economies. That kind of thing.

349:

That isn't what I mean. We have a whole lot of resources that people want to put into innovation, but the rewards mostly aren't there.

Because the areas of technology we're (mostly) pursuing are tapped out; the products of the great burst of new knowledge in the 1930s. The last of that was VLSI and we've about hit the limits of that, too.

If we switched -- really serious investment in non-fossil-carbon energy capture and storage, no-external-inputs-but-rain agriculture, stuff like that -- to new areas of innovation, then there's a lot of rewards available. But at the ragged end of the 30's burst, there just isn't anything much to be had.

Think of it as all the major rewards in aircraft design and manufacturing having been captured by the 707; everything since has been getting more and more expensive for slighter and slighter improvements in efficiency and reliability. (Those constant-speed-variable-pitch quiet turbofan engines rolling out lately are really hard to build. And they're not that big an improvement.) The whole economy is in a position like that.

350:

I was looking at reports of windows broken up to a mile from the explosion. That indicates in excess of 100 tonnes TNT equivalent.

351:

Welcome to the world of market failure.
I seem to recall though that some fellow called Huxley wrote a story where that problem was solved.

352:

I think what you're reaching toward is a New Deal-style system.

Probably not, but then I don't know how to get what I want so I can't be sure. I'm trying to imagine it backward. I imagine it working, and then see what it would take to get there.

I don't know about Britain, but American is pretty well immunized against effective government action. We have a whole lot of people who hold almost as religious belief that government can never accomplish anything effective. Anything it does will cost a whole lot of money and be done wrong. Then whenever the government starts to do something, they try to make sure their prediction comes true.

So, you start an innovative government program. If they can't stop it completely, they will insist that you prepare a budget laying out exactly what you will spend and what results you predict it will accomplish. Then they will provide half the money, and insist that some of the employees be chosen by them, and throw in some requirements intended to cripple you. Then in 2 years they do a study and announce that you only got 3/4 of the results you promised, that the idea is proven a failure and now they know to never try it again.

So I imagine the working program as a for-profit business. Somehow it organizes the economy to be more efficient, and it makes a profit doing it.

It kind of reminds me of Enron energy services. They wholesaled electric power, arranging deals with sellers and deals with buyers, and in theory they provided services that were worth far more than their cost. Unfortunately, the market was set up so the worse the job they did of actually delivering power, the bigger their profits, and so they did a lot of harm.

I'd want something that actually does organize the economy to do what we need, that actually in practice is worth far more than the large profits it collects. I could point at it and say, "This is free enterprise at work. Private businesses have organized to add the regulation that earlier markets didn't. Nobody should complain about this, and if they do complain they don't get a vote." Or something like that.

353:

"I think what you're reaching toward is a New Deal-style system."

No, but that is another approach. I'm proposing using the non-profit sector to make cheap credit available to enable small start-up that can get employment and consumption going. The New Deal was the government directly hiring laborers in support of large-scale public works projects. Since developing nations also/i> need massive investment in their own public infrastructure these two approaches seem broadly compatible; although you have the problem of where the developing nation will get the money to pay for it- America even in the 1930's was a relatively affluent nation.

"One of the big things about container ships is that for many products ocean transport has become cheap."

True, but that is partially offset by the fact that the cost of living in a dirt-poor underdeveloped nation is also extremely cheap.

"If we switched -- really serious investment in non-fossil-carbon energy capture and storage, no-external-inputs-but-rain agriculture, stuff like that"

Good point. Historically, nations that never managed to become invested in the old technology often have an advantage in adoption new technology (not so much old infrastructure to replace). Green technology is more sustainable and we all need to start switching over at some point anyway, so developing nations might as well start there.

"I don't know about Britain, but American is pretty well immunized against effective government action."

I'm willing to go on record predicting that will last exactly as long as it takes for the next deep recession to begin. They will have to start compromising then, if they don't want to see the pitchforks and guillotines.

"I'd want something that actually does organize the economy to do what we need, that actually in practice is worth far more than the large profits it collects."

"It just seems like if there was a way to estimate the right amount of new investment, and then channel the rest of the resources into consumption and no-innovation investment to increase maximum production."

"What you are point out, J Thomas, is the failure of the marketplace to provide everyone with perfect information in real time. It seems that there should be a solution involving public databases of available skills and resources that people could use to conduct exchanges that wouldnt happen otherwise."

I envision a data-driven "labor and services exchange" which keeps track of skills and other resources possessed by businesses and workers in a particular area, one that other people could look up and hire or buy what they need as they need it. It would take a cut off the top of every deal to pay for itself, and act as a productivity multiplier for the rest of the community.

354:

A labor and services exchange would automate a large bit of management, not to mention highlighting less than skillful practitioners of the art.

355:

I see why you'd want to frame it in a market-friendly manner. Still, when someone is broke and his labor isn't worth his food, markets won't solve his problem. Most free-market theories start from the assumption that everyone has something worth trading, because when they don't they all just stand there looking at each other. It's not necessarily a good assumption.

@DeMarquis: What you're describing is called microcredit. It's been tried, with mixed results. See https://en.wikipedia.org/wiki/Microcredit and https://en.wikipedia.org/wiki/Impact_of_microcredit

356:

I see why you'd want to frame it in a market-friendly manner. Still, when someone is broke and his labor isn't worth his food, markets won't solve his problem.

Yes, I agree. I don't see how to do it just with markets, when part of what we want is a certain amount of short-circuiting.

Probably there has to be some sort of government participation, but it might be possible to keep that simple and obvious.

357:

The problem with markets is imperfect information. You can just assume that because someone is underemployed, it's because their labor isnt worth anything.

358:

If a large number of people are unemployed or underemployed, then nobody has figured out how to get value from their labor. If we make the reasonable assumption that many of the affected people are motivated and at least some of them are smart, then we can conclude that their labor doesn't have much value.

If you think that none of the unemployed are smart and motivated, then you have to explain why so many people suddenly become stupid and lazy every time the economy crashes.

359:

If a large number of people are unemployed or underemployed, then nobody has figured out how to get value from their labor.

Yes? The economy includes a certain amount of "demand". Things that people want and can pay for.

If you have the right to buy stuff now, you also have the right to hold onto your rights, and buy later instead. Depending on inflation/deflation and the particular things you want now versus later, your "demand" might be worth more or worth less later. A lot of people instinctively think they deserve for their savings to be worth more in the future. Future spending is discounted compared to current spending. You're putting off consumption when you could die tomorrow and never get to spend. So don't you deserve to have more later if you don't spend it today?

In theory, any demand that you personally defer to the future, will be lent to somebody who will spend it today. So demand will stay high. In practice, sometimes nobody who has the right to buy is buying, and people who want to work must wait. They get no opportunity to earn. The people who could give them that opportunity don't want them today. Next year, or ten years from now, maybe demand will be higher and they can earn some rights then.

It seems to me wrong to just waste all that labor.

On the other hand, maybe if the work *can* be automated, then it *should* be automated. Automation generally produces a better product cheaper. But if the work *can't* be automated, then it will be expensive to manage. You have to teach people how to do the work when something about it keeps it from being automated, which implies that likely human judgement is involved. Then you need to supervise them. Work that can't be automated is likely not trivial to supervise. So if the work can't be automated, it's likely more profitable to just not do it.

Unless you can leave the details to the people who do them. Great artists can work unsupervised. You don't need to tell them how to compose their paintings or whatever. But the economy doesn't need a whole lot of great artists.

360:

"If a large number of people are unemployed or underemployed, then nobody has figured out how to get value from their labor. If we make the reasonable assumption that many of the affected people are motivated and at least some of them are smart, then we can conclude that their labor doesn't have much value."

Sorry, I dont see how your conclusion follows from your assertion. Even though no one is paying them for their labor, their labor could have considerable potential value if the right person found out about them, had access to sufficient capital to hire them, and potential consumers in that market have enough money to pay for it. We've discussed every element of that equation but the first one. Now I am suggesting that a type of community-based "think tank" or employment incubator could do research on the local community and uncover opportunities that the market is not efficient enough to create. I am basing this on the model of "Agriculture Research Stations" that the US used to make available to farmers in the American Southwest in 1930s, except not just focused on agriculture. Basically a way to collect data, and apply technical expertise in a way that helps local entrepreneurs increase productivity and hire more people.

361:

My point is that, when thousands of motivated smart people can't find a way to get value out of something, having a relatively small number of new people look probably won't help very much. We already have plenty of entrepreneurs and wannabe entrepreneurs looking for market opportunities, and they're well aware of the going wage rates. If the new people have less skin in the game than the ones currently looking, it's even less likely to help.

362:

The last of that was VLSI and we've about hit the limits of that, too

Nope. Top-end production right now is 16nm/14nm, but the road maps are already firm on 10nm, and our firm has announced plans to use the upcoming TSMC 7nm process. The great debate appears to be "when to switch to Extreme UV lithography".

Meanwhile, 3D chips are becoming more popular; layers of silicon with through-connections, in the same package.

Add to that the ability to use programmable logic within systems, not just CPUs (Microsoft managed a significant speedup in the Bing search engine through the use of CPU/FPGA pairs; one reason why Intel is buying Altera). Writing your RTL in a high-level language is already here; I know people writing their hardware designs in C++, and finding that the QoR is finally exceeding hand-coded HDL. I sit next to someone trying to solve reconfigurable logic issues, i.e. reprogramming your FPGA on the fly. That's already got legs in the crypto and software-defined radio domains.

So, no. IMHO there's still a long way to go in electronics design...

363:

"We already have plenty of entrepreneurs and wannabe entrepreneurs looking for market opportunities, and they're well aware of the going wage rates."

Again, I must disagree. It's a question of where you commit your time and money- recruiting candidates for a position generally consists of putting out ads on the internet and relying on a combination of a cheap expert system filtering the replies followed by some low-level HR people doing face to face interviews. Surely you wouldn't claim that the job market, even in the developing world, remotely resembles something that is efficient and effective? Why do you think that for the important, executive positions they rely on headhunters? The situation in a place like Uganda must be even worse.

Besides, job placement isn't really what I was getting at. In any community, there will be gaps in the technologies, resources and skills being used by local producers. Maybe local business over-relies on manual accounting practices. Maybe they only hire relatives. Maybe they would expand with more capitalization. Maybe the local labor pool would be easier to hire if they possessed a different skill set. Maybe they simply lack transportation. Whatever it is, the results of this research could be tied directly to local tax, banking, educational and other policies that would help drive development. When they make their research available to the public, producers could connect to other producers, potential customers and employees that they might not otherwise have been aware of. There are all sorts of barriers to effective information exchange, esp. in under-developed contexts, where transportation and communication costs are much higher.

Now take it a step even further. List every business in, say, a 90-minute market along with every machine they own, every employee they hire, and what they do. List every able-bodied adult along with their educational level, their work experience, and their personal interests. List household data including standard of living items like the number and type of appliances they own. Then link all that with similar databases in 1000 or so similar communities in the same nation-state. And make it all open to the public, so that parties in different communities could connect with each other, and local governments could make informed decisions about encouraging local specialization.

I guess what you think would happen next depends on how much faith you have in free unregulated markets. If you think they are already fairly effective, then we just wasted all those IT resources. But if you think they lose a lot of productive potential due to inefficiencies and captures by the rent-seeking classes, then then the scheme I just laid out could be an economic productivity multiplier. Hard to say how much, but surely enough to pay for itself.

See, and my bias is showing here, if you want to liberate the world from the effects of laissez faire ideology and rampant globalization, then you have to question the assumptions of that model. Which would work better in a developing context- traditional open markets, or a more "networked" approach? I've tried to find research on this sort of thing but so far I haven't come across any. We probably wont know until we try.

364:

In any community, there will be gaps in the technologies, resources and skills being used by local producers.

...

Whatever it is, the results of this research could be tied directly to local tax, banking, educational and other policies that would help drive development.

Yes, that makes sense. Allocate resources better, and develop more and faster.

My central concern is something else, which doesn't detract from your point. In our economy, the link between the amount that people want to save versus the amount of useful investment has only a vague and indirect link. Sometimes we get lots of "investment" in ponzi schemes because there just aren't enough real opportunities. Meanwhile consumption is lower than it could be. People are poorer in the short run, and there are fewer jobs.

I don't see any way to fix that. If we had a dictator who actually knew the truth, he could announce "We can't support as much investment as my people want to do. So instead, 60% of the investment money will be given to the poor to consume stuff with, and savers will get some sort of credit for it that they can spend later."

But we don't have anybody like that. For the biggest gotcha, we don't have anybody who really knows when we're running out of good investment opportunities. (Except that investors look harder and harder and have trouble finding anything. P/E for stocks tends to go to unrealistic levels. That kind of thing. Not completely reliable.)

It needs to be not a dictator but a private organization or group of organizations that makes a profit by guessing right. But how can they make a profit by giving stuff to poor people? I can sort of see what needs to happen, but I don't see a way to do it.

365:

You want people to invest their savings more wisely? I suppose there are ways to improve the system, but you're up against the fact that, at the end of the day, it's their money, and people have different comfort levels with risk vs. return on investment. You can educate people better, but ultimately there will always be large numbers of people who think they can beat the odds.

Or are you concerned with the amount of GDP that's caught up in financial speculation vs. contributing to consumption or physical infrastructure? That has a simple solution: put a transaction tax on financial securities and you will suddenly see money flow toward more traditional opportunities.

OTOH, like the Carbon Tax, we lack the political consensus to do that. Put it on the list when the next wave of protests comes.

366:

You want people to invest their savings more wisely?

Sure, but if I really knew how they could invest their savings more wisely, I'd invest my savings more wisely.

Or are you concerned with the amount of GDP that's caught up in financial speculation vs. contributing to consumption or physical infrastructure? That has a simple solution: put a transaction tax on financial securities and you will suddenly see money flow toward more traditional opportunities.

The default is bonds or if you have a tax burden, government bonds. When bond return is too low, then put your money in a currency that inflates slower, and get a paltry interest rate.

Possibly put it into unproductive land that you think will appreciate in value.

Failing everything else, buy artwork that you hope will appreciate.

There are lots of resources we don't use. Labor is one, everybody who wants to work who's unemployed, their time is wasted. I wouldn't say as much for all renewable resources. When we don't harvest timber and it rots in the woods, that's good for the ecology. We meed to leave a lot of trees to rot.

We could produce a lot of stuff for poor people without making the rich any poorer. But there is no incentive to do that, except politically. They don't have money, so you don't get anything by making stuff for them. Easier to let the r

367:

esources be wasted.

368:

Meh. No fun to be had. Bright minds, no insight.

Sifting through the dross ("It was a nuke" etc from the far right blogosphere) and so on, no-one's done the calcs or the why's: and they're scared to.

Look at the chemical composition of that cloud, right next to a Western Renault car depot (c.f. new "explosions" which are really just cars exploding / burning in the Renault lot). It's not exactly how you'd usually structure your industry if you were producing what the chemicals on the tin denoted (c.f. distance from epicenter to wharf, cyanide compounds and risk of rain).

That was their peanut. (@gallery - did you like the art link? I thought it was suggestive)


My peanut is something else. It's much more fun. It's also a little more green and so on.

Mirror, mirror, on the wall... [Film: link safe if used with adblock, ghostery noscript. It's getting so hard to have mimetic references these days...]

369:

It was a transit and storage depot, not a production facility.

371:

Yeah, well, that WAS Ammonium Nitrate, wasn't it?
A major component of many explosives approx 1900 - 1970 (ish) ... & later if you were the IRA.
AM Nitrate will go off on its own, sometimes, but much better if you add Aluminium Powder ("Ammonal") or toluene ("Amatol") to it. Standard WWII Royal Navy HE rounds used such combinations.

No longer readily available in this country - I wonder why that might be?

372:

I am out of date on ammonium nitrate, but it was still a commonplace agricultural fertiliser at the turn of the century. I don't know what record-keeping might have been imposed on ordinary retail, but there was several hundred tonnes around the village, in various farmyards and a haulage yard.

You can sometimes see something on Google Earth. Most was delivered in large bags, white plastic and half a tonne or bigger, some in 50kg plastic bags on pallets. So if you see rows of white dots, the right diameter to fit as two rows on an HGV, that could be ammonium nitrate. Though some farmers would collect has and silage in big round plastic-wrapped bales.

The local Google Earth coverage is at the wrong time of year to expect to see much outside. Application is mostly in spring, and you might see a few big bags out in a field, waiting to be loaded onto a fertiliser spreader. There might be one last low-rate application on some crops, but June and July are getting late.

It's also a bit early to see the big bales and the silage. The oilseed rape is flowering in vast swathes of yellow. while the wheat and barley are still green. The specific dates Google gives are sometimes a bit late, I reckon. and when you can see the County Agricultural Show in progress, it's a rather precise dating that doesn't match what Google says.

373:

When the IRA started using it, it was deliberately degraded by mixing with another chemical, whose name escapes me. What you buy in the UK now is the adulterated version.

374:

Resource management is a problem that has no single objective answer. It all depends on what goals you want to achieve. There is a range of options that maximize resource utilization, economic productivity and environmental sustainability, but no one solution that maximizes all of them. Maximum GDP is inconsistent with reduction in wealth disparity. Unregulated markets are inconsistent with public safety. Maximizing job creation is inconsistent with preservation of the environment. Etc., etc. You have to pick one, and accept the costs of your choice, which will include some wasted opportunities.

The more important question is what goals should our society pursue?

375:

YOu mean the explive or ammonium nitrate. The latter is available, just not sold in garden centres to untraceable weirdos with sheds. Instead you can buy it by the ton if you are a farmer, and every now and then the goverment has a campaign to persuade farmers not to let it be stolen so easily.

Meanwhile they've tightened up the regs on poisons and precursors, so no englishman can have some mercury or some lead acetate sitting about at home without a licence. Or nitric acid. Or even Oxalic acid. Perchlorates are of course not allowed without a licence above a certain threshold.
https://www.gov.uk/government/publications/advice-to-the-public-on-the-control-of-explosives-precursors-regulations-2014

If of course you wish to go down the plausible deniability route, open the above link on someone else's computer.

376:

Resource management is a problem that has no single objective answer. It all depends on what goals you want to achieve.

Yes.

Maximum GDP is inconsistent with reduction in wealth disparity. Unregulated markets are inconsistent with public safety. Maximizing job creation is inconsistent with preservation of the environment.

We are maximizing something else. Investor freedom to do whatever they want with their own money, maybe. So we don't maximize GDP or wealth disparity or job creation etc.

I would want to increase GDP and increase job creation and increase the living standard of poor people. I think we could increase all of those together, compared to what we do now.

Though when I think the possibility is there, I'm assuming a certain skill that may not exist. Just because a better solution to the problem exists doesn't necessarily mean that we can figure out how to do it.

The environment sort of opposes those other three. They fit together with each other, and that one doesn't. I'm conflicted about that.

You have to pick one, and accept the costs of your choice, which will include some wasted opportunities.

You can pick a weighted average of them.

The more important question is what goals should our society pursue?

Yes. I say that if it is in fact a society, then to some extent we need to try to look after all the members. But if it is not a society then it's fine to simply try to maximize the freedom of the richest, and let them use their wealth however they want to reduce the freedom of everybody else.

377:

In reality, all you need is salt, a battery charger and a food mixer and you can whip up an explosive about 60% as powerful as TNT. Feel free to peruse the old alt.engr.explosives group

378:

"Investor freedom to do whatever they want with their own money, maybe."

Well, I have to say that this is a goal that I've never felt particularly concerned about. Why do you want to maximize that one?

"The environment sort of opposes those other three. They fit together with each other, and that one doesn't. I'm conflicted about that."

"You can pick a weighted average of them."

My point was that you cant maximize any of them without impacting the others I listed (and many I didnt). If all you want is a weighted average of some kind, that's very likely a soluble problem.

I'm not sure why you worry that we may not have the skill to find the solution. I think once you have your social goals lined up and prioritized it pretty straight-forward macro-economics from there. The real challenge, as I've been pointing out, are the political barriers, not technical ones. If we know what we want, then it reduces to a problem in mass-mobilization. In other words, tactics, not strategy.

379:

"Investor freedom to do whatever they want with their own money, maybe."

Well, I have to say that this is a goal that I've never felt particularly concerned about. Why do you want to maximize that one?

It's maybe an american thing. The theory is that if something belongs to you, then you get to decide what happens to it because it's yours. It can't just get taken away from you because somebody needs it more, or somebody can use it better, or whatever.

So, like, say you own a mine or a factory or something. Maybe you'd make money if you hired people to make stuff but you don't want to. You might feel like your minerals will be worth more later than they are now, or you might just not want to. So the theory is that you get to choose for yourself. Nobody else gets to decide that you should increase GDP or increase employment, because it's your property and your choice what to do with it.

If you and a bunch of your fellow owners decide you want to cause a big recession or even a depression, that's your right. Because nobody gets to tell you what to do with your property.

To some extent the USA runs on this philosophy. But to some extent we have the idea that the government does know best what ought to happen, and if you don't feel like using your property the way they want you to, they have the right to bribe you more and more until you do agree to do what they want.

Needless to say, this goal interferes some with GDP, employment, preserving near-extinct species, etc.

380:

There's some very specific things that haven't yet come into the maelstrom of MSM yet, but:

Having read Lloyds, and [redacted - not here] and other industry analysis's, this is rather more than you'd imagine. [Hint: you look up who the shipping companies are, you look up their insurers and you look up who shipped what to whom via that company. I find it interesting what Sodium Cyanide is used for - don't you?]

What is does is threefold:

Tie up N. China imports/exports and the entire Asian (c.f. India NaCN trade) network up. It's called the Baltic Dry Index. Funny thing is, it crashed a little bit before this mess.


Gold / electronics. NaCN is 50% (roughly) imported by China for internal use. The major export targets are India.

Boom Badda Booom. There's a reason the port is being forced to function.


*shrug*


As ever, talk about the weapons, never talk about the reality. And now, magically, we're thrown back about discussions over 21世纪海上丝绸之路.


Looks like it got torpedoed.


Such is life...


381:

Fellow Yank here!

Property rights are very strong in the US, in certain ways maybe too strong. What do you feel is the best way to balance the common interest against the individual rights of property owners? If the government cant provide incentives designed to, for example, reverse climate change, then in the long run we are all going to be hurting, including property owners. Even Adam Smith and John Locke recognized limits to right to acquire and use property. It cant be unrestricted, in the face of compelling social need, lest the economic system that supports the value of that property become unstable.

As for who is best positioned to make these kinds of determinations, ultimately on the government has the authority to approve restricting a citizens right's, but it should be acting on the basis of considered expert opinion, not factional politics. I can think of some better ways to ensure this than we currently use, if you wish to discuss it.

382:

What do you feel is the best way to balance the common interest against the individual rights of property owners?

You got me there. Any amateur auto mechanic can listen to your engine and say it's out of tune. It takes more skill to actually tune it well.

I am more interested in the short run in trying to find principles that look kind of fair, to compete with the libertarian ideal that every large corporation should have the freedom to do whatever it wants.

After all, when the government lets people own their businesses or capital and the government decides what to do with it, isn't that exactly what they used to call fascism? It has a bad reputation. I'd prefer not to have to argue in favor of fascism, so I need something else. And yet some government regulation is needed.

My first thought is that we should try to limit the size of very entity except government (and government too, in special ways). Businesses which are too big have too much political clout and TBTF is bad. I like the idea of setting a maximum size for corporations, and when one reaches that size it must divide in two, like a bacterium or something. Of course when lots of small corporations organize together for a big project, then they might be organized enough to lobby effectively and collectively they may be TBTF. I'm not sure how to handle that, but keeping individual businesses reasonably small seems like a good start.

I'm not sure we ought to have private fractional-reserve banks. I don't see any way to justify it morally, and 2008 says we can't depend on them to deliver good results.

So, if you have money you want to spend today on consumption, you should have a whole lot of say about it. You should be able to buy anything for sale that isn't considered too socially damaging. (Like, we probably ought to try to limit iocane sales.)

But we need some sort of limits on businesses. Size. Maybe businesses should make their records transparent. If they couldn't have secrets it would change the game, maybe for the better.

Government probably should have some levers to affect the economy, and those ought to be kind of general, slow-acting levers. There's the problem that politicians like CEOs can't afford to look at the long-run when their short-run survival is at stake. They have to win in the short run and let the future take care of itself unless they have the leisure to plan. If they have too much immediate power they will use it to win elections and then deal with the consequences after they win. I'm not sure what to do about that.

So I have some ideas I think would be improvements, but designing a system that actually tunes the economy to efficiently do what we want it to? That looks hard. Especially when any statistics you use to decide what to do about the whole economy, will start getting manipulated whenever people realize that you're using them for that. Though maybe if the various economic entities were smaller, it would be harder for them to do that....

383:

"After all, when the government lets people own their businesses or capital and the government decides what to do with it, isn't that exactly what they used to call fascism?"

Not precisely. Fascism is when a specific political party recognizes no limits to it's responsibility to pursue the interests of the nation as a whole. Democracy centers the power to pursue the public interest in the public, acting through their elected representatives. The will of the people is generally also limited by a code of individual and minority rights (in the US, this is the so-called "Bill of Rights"; elsewhere, it's the UN "Declaration of Rights". In the US, one problem we have is that the Supreme Court has, over time, re-interpreted the Constitution to give corporations certain rights that were originally awarded to individuals (such as the right to own property, or to sign contracts). More recently, they have given them rights of free speech, with well-known consequences for our electoral process. So one approach is to start taking away some of the legal rights that corporations have won in recent years.

Another approach is the idea of writing "social responsibility" clauses into corporate legal status charters. Right now, the legal obligation of the officers of a US corporation is strongly slanted toward protecting the value of the shares. We could easily re-write the law so that other considerations are also required, such as environmental or social impact statements with respect to their business operations.

Limiting the size of corporations is very similar to the idea of not letting one business dominate any single market. We already have those protections, but they have been significantly weakened in recent decades. We could make those rules a lot tougher- requiring mergers, for example, to meet more stringent requirements in terms of total percent of market (this would undue a lot of cable media conglomerates, for example).

Another area that we could make a lot tougher is accounting practices and a requirement to make the results of an annual financial audit public. In order for securities to be priced effectively the market has to know the true value of a corporation and the amount of risk associated with it's shares. Right now, that information is only partially available, so we could open that up.

Yet another practice I'm interested in exploring is the so-called "German Model" where employee and community representatives get a certain number of votes on the shareholders board. That creates an accountability right in the heart of corporate power, and certainly doesn't seem to have undermined the productivity of the German economy.

I guess the point I'm getting at is that there is no one solution to this problem, but there are a lot of little ones. You can tell which ones are important because they are the ones that the corporations themselves have lobbied Congress to loosen over the years.

One problem I would like to see a solution to is the "one dominant employer" problem, whereas a large business dominates a local economy to such an extent they can essentially write their own tax laws and zoning regulations, and when the decide to leave, the community is devastated. Walmart comes to mind. That's another reason I like the "local business incubator" idea; lots of mid-size businesses diversify the economy, and provide a political counter-balance to the power of the smaller number of larger businesses.

As for banks, there were lots of problems in 2008, but one of the main ones had been banking de-regulation. We could easily place limits on how much of it's account holders savings they can invest in buying up debt and securities, as opposed to investing it in new start-ups or or what-not. We can also place stricter controls on who they lend their money to, and under what terms, so that the total amount of risk in the system can be managed. If some form of debt-relief were written into home mortgages, you would see the banks suddenly become a lot more conservative in their lending practices.

The government is a tougher problem: "If they have too much immediate power they will use it to win elections and then deal with the consequences after they win."

Well, yes, that's endemic to representative democracy. And the underlying reason they do that is because the public votes primarily based on emotion, not intellectual analysis. Is there some way to give technical experts some formal but appropriate amount of leverage in the policy-making process? But that's a whole other discussion.

384:

https://en.wikipedia.org/wiki/Fascism#Economy
Fascist economics supported a state-controlled economy that accepted a mix of private and public ownership over the means of production.[173] Economic planning was applied to both the public and private sector, and the prosperity of private enterprise depended on its acceptance of synchronizing itself with the economic goals of the state.[174] Fascist economic ideology supported the profit motive, but emphasized that industries must uphold the national interest as superior to private profit.[174]

Your definition of fascism to me would fit the term "authoritarianism" in general. Fascists allowed and encouraged private ownership, but they planned what private businesses should do and punished them for not following the plans. To some extent they separated ownership from control.

To some extent publicly-owned corporations today separate ownership from control. The owners of large blocks of stock get some influence over the corporations, but most owners mostly have the choice of keeping the stock or selling it for whatever they can get. Sometimes management gets most of the control, or control can reside in some other corporation that indirectly holds stock etc. If you have no choice but to let WalMart look at your books and decide how much you will sell to them at a 3% to 5% markup, I'd say you've lost control.

The problem is that lots of US voters do not approve of government planning. They would probably approve even less of unaccountable private businesses doing that planning. The least offensive approach is for nobody to plan, and things just automatically work out fine on their own. Of course, that's not exactly reliable....

... So one approach is to start taking away some of the legal rights that corporations have won in recent years.

Yes. But then, the people who argue that government does no good, argue that "regulatory capture" will mostly prevent the government from enforcing good laws against large corporations. When bureaucrats who make $200,000 or less per year go up against managers who make tens of millions or more, they can be intimidated.

Limiting the size of corporations is very similar to the idea of not letting one business dominate any single market.

Yes. One virtue of this approach is that it (in theory) could be made simple and clear. A corporation can argue that they are smaller than they really are, but they can't argue that indefinitely and they can be forced to split into smaller corporations that should be more competitive. I think it's easier to show a corporation's number of employees, profit, cash-flow, etc than many of the things we would like to regulate about large corporations. It wouldn't help keep single markets from being dominated as well because different markets are different sizes. A small market could be dominated by a corporation that would be much too small to dominate a larger market. But setting a maximum would help keep individual corporations from being large enough to dominate the government.

I guess the point I'm getting at is that there is no one solution to this problem, but there are a lot of little ones.

Yes!

You can tell which ones are important because they are the ones that the corporations themselves have lobbied Congress to loosen over the years.

You can tell those have been important battlegrounds. There might be others that would be important if the challenges were made.

As for banks, there were lots of problems in 2008, but one of the main ones had been banking de-regulation.

It's like -- prostitution might work out better if it was regulated. We could have rules about how hard a pimp can hit his women, how much he must pay them if he injures them, how much of the money he must give them, their contracts must state how long they are required to stay with him, and the police will only return those who run away if their contracts haven't expired, etc. That might reduce the excesses. On the other hand, it might be better not to legalize pimps at all. Similarly, when the banking industry fails we can argue that it was insufficiently regulated, but it might be better if it was just plain shut down, and private bank loans illegal to lend though legal to borrow.

... the public votes primarily based on emotion, not intellectual analysis. Is there some way to give technical experts some formal but appropriate amount of leverage in the policy-making process?

How do we know who's an expert? The public isn't just emotional, also they know that they can't predict very well. They can't judge politicians on long-run predicted economic benefits, because those might not happen.

I would tend to suggest that we let experts make predictions about important economic variables, and give them more say in what to do according to how well their predictions come true. But this has its own problems since the indicators which are worth following will change over time.

The big US example of experts given special rights is the Federal Reserve. Fed governors are important people and particularly the Chairman can make the economy quake just by saying a few choice words. And of course people try to influence them. Greenspan was declared a genius because he kept lending more when the conventional wisdom said it would cause a catastrophe. But Greenspan saw that the conventional wisdom was wrong and everything would be fine. It's possible that Bush threatened him with assassination if he didn't do that.... I have no evidence of that, it's just a possibility....

If we give experts special leverage, we are betting that they are right. I'd like in each individual case to see objective evidence that they're likely to be right.

385:

May I take a moment to say that this conversation is getting more fascinating as the wall o' texts keep getting longer? I wonder if anyone else is reading all this?

Yes, all that you say regarding Fascism is true, the problem is that it's also true for many other political systems. "State Capitalism" systems like contemporary Russia and China do more or less the same thing, but arent Fascist. Unfortunately I've never come across an objective definition of the unique features of Fascism that included all instances and excluded all alternatives. My point is that the term itself doesnt seem very useful to me. Anyway...

The divergence between owners and managers (sometimes called the "Agency Problem") is problematic for the economy at large. One of the biggest issues in my opinion is that, beyond a certain point, large shareholders are not greatly invested in the future success of the company they own. Such investors usually have money in a wide spectrum of companies in a range of economic sectors, so unless the entire global economy goes belly up they can afford to be sanguine regarding any one company they happen to own. They are not even overly concerned if the CEO happens to be running one of them into the ground in order to make a short term profit off of his own shares. We are all aware of the problems this causes the rest of us.

"But then, the people who argue that government does no good, argue that "regulatory capture" will mostly prevent the government from enforcing good laws against large corporations."

I think this problem itself is overblown somewhat, but the real barrier here is not objective reality, but the political opinions of the people who believe this is true. It has traction because policies which are based on this world-view also happen to be in the interest of the very wealthy. This problem is somewhat self-correcting- it generally is only popular when the economy is doing relatively well. During recessions and depressions, the masses tend to turn the other way. That's how we ended up with a social safety net in the first place. Sooner or later, pursuing policies that benefit only the wealthy will tank the economy, and that will produce a political backlash. The question is whether or not we have to wait until then to design a more rational system...

"A small market could be dominated by a corporation that would be much too small to dominate a larger market. But setting a maximum would help keep individual corporations from being large enough to dominate the government."

The key metric here is the relative size of a business' closest competitors. This is relatively easy to measure, which helps explain how we have anti-monopolist laws in the first place. I have no idea what the "maximum desirable ratio" might be, but if one company's market share is greater than that of all it's direct competitors combined, that can never be good for consumers. Even two or three "top dogs" isn't necessarily healthy. My best guess is that 5 or 6 businesses all competing with more or less equal market share is idea, so if any one company manages to capture more than, say 30% I would want the SEC to take a close look at that. We arent anywhere near that stringent, however.

I would guess that it's trivially easy to show that banking brings more benefits, and imposes fewer costs, on the community than prostitution does.

I think we have a lot more examples of expertise in government, and more successful examples, than the Fed. The EPA, the SEC, NOAA, NASA, FEMA (currently), the FDA, and so on. Most of them are work reasonably well most of the time. The problem isnt how you incorporate expertise into government policy, it's how to keep partisanship out of it when the stakes are high. We can improve workplace safety by orders of magnitude, but we cant reliable balance the budget, which in many ways is a simpler problem.

One solution is public education- we could spend far more resources on teaching our children to evaluate claims based on evidence than we do (my own students, at the college level, clearly have very little idea how to do this). This could, at the very least, help create a political climate in which other changes could then fall within the "Overton Window" (such as some of the things we are discussing here).

But that doesnt solve the problem that technical experts are also human, and are just as susceptible to cognitive bias, or abuse of their influence, as anyone else is. One problem is that our culture over-relies on the opinions of individual researchers. We tend to treat each one as an "expert witness" and try to compare them to each other to determine which seems more plausible. Whereas we would usually do better to try and identify a "scientific consensus" on a particular issue and rely on that. No one scientist might endorse the consensus but most of them would average around it, and all else being equal that position is maximally likely to be the correct one (this approach has the additional benefit of being relatively easy to update over time). I bet it could even be automated- how hard could it be to program an expert system to collect published articles on a particular topic and identify a "median" opinion? It would then be simple to test the predictions of this median opinion and rate its' track record over time. Make it self-learning and it wouldnt be long before it did better than any individual human (although the singluarity people might have a heart attack over this!).


386:

I'm reading the contributions that aren't J Thomas'; I feel the signal/noise ratio and comment length makes it a bad investment. (I realize my contributions are no shining light of clarity, either; I try to keep the length down in recompense.)

There's an argument (I came across it being advanced in respect of the rabid puppies) that fascism is an aesthetic, not a philosophy. It would explain the difficulty defining fascism's political and economic features.


I bet it could even be automated- how hard could it be to program an expert system to collect published articles on a particular topic and identify a "median" opinion? It would then be simple to test the predictions of this median opinion and rate its' track record over time.

Now define "published," in a word where "predatory publishers" are a thing.
:-P

387:

I meant in peer-reviewed journals. I realize that even peer-reviewed journals are flawed sources of information- but all sources of information are flawed, the only issue being what source of expert opinion is least unreliable over the long run?

That was a fascinating link, thanks.

And thanks for commenting!

388:

There's an argument (I came across it being advanced in respect of the rabid puppies) that fascism is an aesthetic, not a philosophy. It would explain the difficulty defining fascism's political and economic features.


That's very close to being true. It's not close to the reality, but it has a kernel of truth that's essential to understanding it.

Facade of Italian Fascist Headquarters


Without diving into the artistic history of the movement, and the use of art in all Fascist movements (Triumph of the Will vrs the Communist versions such as Battleship Potemkin etc c.f. Tarkovsky's comments on Eisenstein and the failure of the modernist trend in early Soviet film), the issue boils down to:


Americans fundamentally lack a certain mental schema to understand Fascism (the historical version), because the public cultural space has always been dominated by Advertising (Capital) or Puritanical Churches.


That's not the case in Europe.


If you need to parse it out, look up the Unicorn as the national animal of Scotland (no, really) and some diabolical propaganda statues outside of a nationally famous Cathedral.

Yes, they made the unicorn look like a donkey. No, really. It was 100% deliberate.

389:

It is very close to being true, but it isnt, quite, because, the use of art and narrative in that way- the "stabbed in the back" syndrome and the "heroic savior" meme- isnt (sadly) unique to fascists. It's true of other groups as well (ask any US military vet why we lost Vietnam- DO NOT admit to being a jounalist!). I do like the idea of it being primarily an aesthetic, though.

Americans probably cant quite understand fascism the way Europeans do, but we have our own forms of cultish political extremists, puritanical churches very much included.

390:

That's because we value function over form. But we get it vicariously, via media. I read "From Hell". Our creative output is channeled into music instead of architecture. And food. Food is highly symbolic. And bumper stickers. America produces the world's most creative bumper stickers.

391:

My point is that there are journals which impersonate peer-reviewed journals so as to harvest publishing fees and are less than straightforward to reliably detect; picking your dataset would be not entirely straightforward, especially given (if your consensus-finder started to be listened to) the incentive for the "merchants of doubt" to poison the dataset. Not saying it's a bad idea! Just carping and criticizing, as per usual. :-)

392:

"Those goddamn hippies betrayed Our Troops" (to presume and caricature) *doesn't* sound proto-fascist to you?

393:


I think we can program the expert system to detect publishing fees and delete from the database. Keep criticizing- it makes ideas stronger!

As for the Vietnam vets- I'm not comfortable calling such people "fascist"- I think it's a bit unfair considering that they seem otherwise able to think for themselves. In general I have a bias against stretching terms too broadly- keeping definitions somewhat precise allows useful distinctions to be made.

394:
I think we can program the expert system to detect publishing fees and delete from the database. Keep criticizing- it makes ideas stronger!
Bit of a baby/bathwater solution, that.

I said "proto-" for a reason. My caricature statement isn't, but the map from believing it to fascism is easily drawn.

395:

I think thats painting with too broad a brush. Too many false positives using that criteria.

396:

And another Chinese facility burns. I apologize for driving off the weapon buffs, but hey.

Ἑσπερίδας θ᾽, ᾗς μῆλα πέρην κλυτοῦ Ὠκεανοῖο

χρύσεα καλὰ μέλουσι φέροντά τε δένδρεα καρπόν.

Καὶ Μοίρας καὶ Κῆρας ἐγείνατο νηλεοποίνους,

[Κλωθώ τε Λάχεσίν τε καὶ Ἄτροπον, αἵτε βροτοῖσι

γεινομένοισι διδοῦσιν ἔχειν ἀγαθόν τε κακόν τε,]

αἵτ᾽ ἀνδρῶν τε θεῶν τε παραιβασίας ἐφέπουσιν·

οὐδέ ποτε λήγουσι θεαὶ δεινοῖο χόλοιο,

πρίν γ᾽ ἀπὸ τῷ δώωσι κακὴν ὄπιν, ὅς τις ἁμάρτῃ.

Τίκτε δὲ καὶ Νέμεσιν, πῆμα θνητοῖσι βροτοῖσι,

Νὺξ ὀλοή· μετὰ τὴν δ᾽ Ἀπάτην τέκε καὶ Φιλότητα

Γῆράς τ᾽ οὐλόμενον, καὶ Ἔριν τέκε καρτερόθυμον.

It's not like this is hard.

You killed my sister and my mother.

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