Re: Yen still overvalued
> okay, the "high yen" makes sense to me now, but then why does Japan have > such a large trade surplus? Basically because the US buys large amounts of Japanese-made automobiles and parts. Meanwhile, only a crazy person would buy a US-made car in Japan. Ford does sell some Mazdas with the Ford nameplate on them (this was the company that levelled 'dumping' charges over 'light trucks' against Mazda even as Mazda was supplying them with the same vehicles--no coincidence that Mazda is now owned by Ford). Japanese, by the way, love European cars. Also, the huge trade surplus looks even more huge when you go from overly strong yen into overly weak dollars. It's a similar effect that makes Japan look like a very expensive place to live--outside of buying property, it isn't. > anyway, let's combine two threads. I'm no expert on Japan -- or foreign > exchange matters, for that matter -- but it seems like there are three > hypotheses I can think of: > > 1) Japan is in recession due to the financial system being overburdened with > bad debts -- this is the basis for US official calls for restructuring. More like the financial system is in distress because of a bad economy and poorly thought out financial liberalization (with the issues being 'what is a bad loan' and 'what are required capital adequacy ratios'--8% being the international standard). > > 2) Japan is suffering from deflation and recession -- this is the basis for > calls for reflation a la Krugman. (I hadn't heard of those other parts of > his program.) Not really Krugman's original thesis, just a bandwagon. > > 3) Japan is suffering because the Yen has been too high relative to the > dollar since the Plaza Accords -- this is the basis for your call for a > movement of the Yen toward purchasing-power parity. I see all three points as working together. The only thing that correlates perfectly as far as I can see with the down economy is the overly strong yen. I became convinced when I saw that the economy was recovering 1995-1997 until the yen went back up, just as the US wanted, and the economy tanked and all of Asia was plunged into a currency, liquidity, debt crisis. Some of that still lingers. I haven't seen any very specific analysis of the loans at banks in Japan in their totality. I don't think there is just one way to characterize them. I think, however, many are linked to small and medium sized businesses, not the Daiei's you hear about in FT. I also think, though, that a lot of these loans are linked to Japanese companies trying pathetically and desperately to set up operations in places like China because of the strong yen. I know of several companies in Fukui that fit the pattern, and if I know of them, then there must certainly be lots more. > > My feeling (not having studied the foreign-exchange aspects of Japan's > stagnation sufficiently) is that what Japan needed was reflation and that > without it, any further financial restructuring would mean deeper recession > and increased US financial power over Japan. So at best, reflation and > restructuring are complementary programs. But what do we mean by restructuring. For the 'analysts' at the investment banks it means selling their consulting services and obtaining insider knowledge on the best stuff to snatch up at 10 cents to the dollar. Reflate the economy and then take care of the restructuring, which I might remind you, is really a microeconomic matter for banks and companies. No one made Koizumi economic dictator--YET anyway. > > Now, depreciating the Yen relative to the dollar would clearly help Japan's > exports. and its economy. But wouldn't that encourage recession in the US? It sure would piss off a bunch of suppliers who rely on China for their supplies. Would a dollar at PPP with the yen encourage recession in the US? No, it would just mean imports would diversify (suddenly Japanese notebook PCs, which are ten times better than anything Compaq sells, would be affordable) and autos would get cheaper. The US economy is much more diverse (as we might expect of a country in the middle of a continent with large amounts of resources and large economies on both the north and south borders) and less volatile than Japan's. It's currency is the de facto currency of the world. It's financial markets are where everyone goes to raise capital or to park it. Charles Jannuzi
Re: Question to Various comments in In Digest 77
>
>CB: Doesn't _The Manifesto of the Communist Party_ make it pretty clear
>that Marx's theory of history is rooted in the relations of production
>aspect of the forces of production, the division of labor, and the class
>struggle ? History is a history of class struggles, not technological
>innovations. Since producers are part of the forces of production , it is
>their development that is in the forces of production that makes history,
>and historical revolutions.
>
>
That's one strand in Marx. The other one is represented most famously by the
1859 Preface to the CoPE, where Marx sets out the "forces" thesis, which he
also stated as early as 1847 in The Poverty of Philosophy ("the hand nmill
gives you the feudal lord, the steam mill the industrial capitalist"). Cohen
may overdo the claim that Marx is _consistently_ committed to the forces
thesis, but his book establioshes with scholarly rigor that Marx was often
committed to it. You have to read the book carefully, it's as important a
piece of Marxist analysis as has been published in the last 50 years.
Personally I think that Marx never thought through the tensions between what
have come to be called the class struggle/relations of production account,
articulated by Fisk, Miller, and Brenner, and the forces of production
account, articulated by Cohen and Wright Levine and Sober (among others).
jks
jks
_
Get your FREE download of MSN Explorer at http://explorer.msn.com/intl.asp.;
RE: Yen still overvalued
Charles J: okay, the "high yen" makes sense to me now, but then why does Japan have such a large trade surplus? anyway, let's combine two threads. I'm no expert on Japan -- or foreign exchange matters, for that matter -- but it seems like there are three hypotheses I can think of: 1) Japan is in recession due to the financial system being overburdened with bad debts -- this is the basis for US official calls for restructuring. 2) Japan is suffering from deflation and recession -- this is the basis for calls for reflation a la Krugman. (I hadn't heard of those other parts of his program.) 3) Japan is suffering because the Yen has been too high relative to the dollar since the Plaza Accords -- this is the basis for your call for a movement of the Yen toward purchasing-power parity. My feeling (not having studied the foreign-exchange aspects of Japan's stagnation sufficiently) is that what Japan needed was reflation and that without it, any further financial restructuring would mean deeper recession and increased US financial power over Japan. So at best, reflation and restructuring are complementary programs. Now, depreciating the Yen relative to the dollar would clearly help Japan's exports. and its economy. But wouldn't that encourage recession in the US? jim d
Re: Newspapers and Bank of Japan Are All Wrong About Bad Loans
> what do you think of the Krugman proposal that the Bank of Japan set an > inflation target of 2 or 3 percent per year in order to fight deflation and > get real interest rates down (to stimulate spending)? > Jim D To my mind, Krugman is more a paid consultant and NYT author than he is an economist or anyone I should take very seriously. The 'liquidity trap' is nonsense. Where was he when I said deflation was the problem 4 years ago (but then again, where was I, obscurity knocks!). I don't buy all of the Krugman analysis or the proposals (pegging the yen to the dollar at 150 to the dollar, lowering interest rates on loans by raising savings interest rates, and increasing personal consumption). The last part is the weak part of the whole argument. Reflate the economy and stablize it and quell peoples fear and consumption will go up. Consumption isn't going to go up just because everyone can take out even more affordable loans. To my eyes, consumption never went away. Unlike all the empty malls I saw in the US two years ago, shopping places here are always crowded. However, there is the 'Uniqlo effect'. You buy two coats made in China with the strong yen and you just consumed less than you did last year buying one coat made in Japan. Uniqlo is a retail and mailorder company that sells high quality, low priced clothes nationwide. It's been able to do this because it has its own design, production and distribution system that links it with both its producers in China and its stores and customers all over Japan. It's also been able to do this because the Chinese currency is way, way undervalued against the yen. Another example: a McD's hamburger sells for less in Tokyo than NYC. These phenomena now pervade the retail sector in Japan. If you unilaterally set hard targets and pick simple means to achieve them, venture/vulture capital (mostly from the US but also France) eats you alive. Raising interest rates on savings might just ruin banks' profits still further, and it would seem thousands of small and medium sized companies just want to pay off the loans they have now instead of taking still more. What's needed is coordinated dollar-yen policy from both the US and Japan to push the yen back in stages toward PPP and keep it there til the economy reflates. Then companies will start to make money, whether or not they export (now a mixed bag since Japanese exporters have so much of their production of commoditized stuff in China, Thailand, Malaysia and even the US). And loans will start to become payable again (for the thousands of small and medium sized companies many of which have restructured and redrawn their business plans after the keiretsu abandoned them). The US doesn't care about coordinating a weaker yen; I'm sure 140 is the line that the Japanese can't cross, and in fact the markets are betting more like 135 as the level O'Neill has set. When O'Neill and Bush say 'restructure' what they really mean is: Japan can be the next Philippines for all we care, US venture capital (e.g., Carlyle Group) will now run the show. This ties in neatly with the priorities of the US administration on the next round of WTO: free up venture capital to buy up anything that is networked (telecoms, internet, finance, energy markets, etc) and the US leads the way. Japan is well on board; too bad it's going to destroy their financial system in the process. Right now the only thing that is happening is Koizumi thinks 'reform' and 'liberalization' and 'restructuring' are miracles performed by 'markets' and vulture capital gathers, circling the drain, closing in...closing in all those wonderful 'bad' loans and billions in luchre! Charles Jannuzi
Yen still overvalued
> huh? the US$ has been soaring since the mid-1990s. How could it be "cheap"? > Are you saying that the Yen is even stronger? > JDevine > > Damn, the myths of the western financial press (in service to investment banks) die hard. The US dollar (and the yen, too) has soared against the currencies of other anglo 'free trade' countries--Canada, Australia and New Zealand. It's done pretty well--better than expected--against the euro, but that's been pretty stable actually. If you've seen the sort of dollar-yen movements that I've noticed, the dollar-euro thing is nothing much to speak of --yet. However, for the past three decades there is only one overall movement of the yen vs. the dollar, AND THAT IS UP AND THAT IS BECAUSE OF US POLICY POST PLAZA ACCORDS ONWARD--REAGAN II, BUSH I, CLINTON I-II. As one Clintonite said, Hell, we'll go to one yen to the dollar if that is what it takes to balance trade with them. Let me recapitulate the movement in highly schematic terms. If you started in 1970 you have a yen of about 300 to the dollar. In 1994 the yen peaked at 79 to the dollar . The yen then depreciated some up until the Asian crisis, when the Clinton administration re-affirmed the cheap dollar vs. the yen policy. It's interesting to note what happens when the yen depreciates back toward PPP. 1. the Japanese economy starts to pick up (such as 1994-1997) and 2. some exchange trader lackey somewhere can't believe the yen will be allowed to depreciate for any amount of time and blows a few hundred or million or so betting on reverse movements (N. Leeson in Singapore, the guy in Baltimore working for the Irish bank). Yes, historically speaking (1970-2000) usually betting against the appreciation of the yen vs. the dollar is a sucker bet, but for the past year it has depreciated (from around 110 to the dollar toward about 130 to the dollar--I'm sure O'Neill draws the line at 140). Charles Jannuzi See the article I posted ealier but am reposting here: YEN APPRECIATION AND ASIAN DEBT by Prof. Leonor M. Briones* Geneva 28 Oct (TWN) -- The Japanese yen started to appreciate in value against the US dollar in the second half of the 1980s, and this trend become more dramatic in the 1990s, with the 1994 yen value (at Y103.33=$1) twice that of the 1980 value (Y217.2=$1). The importance of this yen appreciation on the debt of situation of developing countries is better understood when seen within the context of Japan's growing importance as a creditor country. In 1994, Japan accounted for $121 billion or 25.7% of all bilateral claims on developing countries, more than twice that of the second biggest creditor -- Germany with $53.9 billion claims or 11.4%. A large part of the Japanese exposure is in Asia. Of the total Japanese bilateral credit, around 60% is lent to East and South Asian countries. The increasing indebtedness is reflected in the rise in yen-denominated long-term debt of many Asian countries. On the regional level, the yen component of the long-term debt of East Asia and the Pacific increased from 17.9% in 1980 to 36.6% in 1986, and remained thereafter at about 30%. In the case of South Asia it has increased from 8.8% in 1980 to more than 16% in 1994. The situation is magnified when we look at Asian countries whose yen component of long-term debt exceeds the regional averages. At least six East and South Asian developing countries have more than 25% of their long-term debt in yen denominations: Bangladesh 25.6%, Indonesia 37.7%, Malaysia 39.4%, the Philippines 38.1%, Sri Lanka 29.6% and Thailand 53.0%. The Yen's movement against the US dollar cannot but have an effect on the debt situation in these countries. Many of the countries heavily indebted to Japan turn a blind eye to the yen appreciation's real effects on their indebtedness. Two factors account for this. First, the importance of Japan in crucial areas of their economies compels these countries to approach the issue with caution. After all, Japan provides a steady stream of official development assistance, is a major source of foreign direct investment (FDI), and is increasingly becoming a major trade partner of these countries. Indonesia, for instance, brushed aside the impact of the yen appreciation on its debt situation, confident that the negative impact on their debt could be offset by the relocation of Japanese investment to foreign countries, including Indonesia. Second, the Asian countries heavily indebted to Japan have exerted great efforts to package themselves internationally as having resolved their debt problems. The countries whose yen component of long-term debt exceeds 25% are classified by the World Bank as either moderately or less indebted; they would not want to jeopardise their improved classification with the acknowledgement of the negative impact of yen appreciation. To be sure, countries heavily indebted to Japan are differentially affected by the yen appreciation. The extent of impact depends on the importa
RE: Newspapers and Bank of Japan Are All Wrong About Bad Loans
what do you think of the Krugman proposal that the Bank of Japan set an inflation target of 2 or 3 percent per year in order to fight deflation and get real interest rates down (to stimulate spending)? Jim D
RE: Re: Wade vs Wolf
Charles J. writes: > the US cheap dollar/strong yen policy has pushed China into the fore as huge exporter to both the US and Japan< huh? the US$ has been soaring since the mid-1990s. How could it be "cheap"? Are you saying that the Yen is even stronger? JDevine
Re: Electricity markets and the Supremes
Yes, and now the Majority Leader Daschle (D-SD) and his colleague Bingaman (D-NM) will try to shove federal electricity deregulation through the Senate. Their "Energy Policy Act," cloaked with some environmental amenities (see below), would repeal the Public Utilities Holding Company Act (PUHCA) of 1935, which prevents big interstate utilities from exercising monopoly power. The repeal of PUHCA would give energy companies the ability to buy utilities and merge with one another to form ever-larger, more powerful companies with no mandate to provide quality service to their customers. It was after winning an exemption from PUHCA regulations in 1994 that Enron was able to become a major gouger in energy markets. -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail [EMAIL PROTECTED]
Re: Wade vs Wolf
Doug Henwood put us onto the questionable nature of World Bank statistics in Indonesia. Doug has also strongly criticized some of David Dollar's work, if I recall correctly. I cannot believe that poverty is decreasing in China. I realize that some have risen, but many more have fallen. Bill Lear mentioned Sen, who has emphasized that the data can be misleading -- that in places like Kerala quality of life can exceed what might be inferred from poverty data. Anthony earlier enriched our understanding of this subject. -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail [EMAIL PROTECTED]
Electricity markets and the Supremes
Monday, March 4, 2002 Ruling Seen as Win for Competitive Electric Markets WASHINGTON (Reuters) - The U.S. Supreme Court Monday upheld a 1996 Federal Energy Regulatory Commission (FERC) order designed to ensure open access to the interstate energy transmission grid. The vote is a major victory for proponents of competitive U.S. electricity markets, industry officials said. The justices affirmed a U.S. appeals court ruling that upheld the regulations that seek to end discriminatory, anti-competitive practices and to make sure consumers pay the lowest prices possible. The justices rejected two separate challenges. One was brought by state regulatory commissions from New York, Florida, Idaho, New Jersey, North Carolina, Virginia, Washington, Vermont and Wyoming, while the other challenge came from a unit of the collapsed Enron Corp. New York and the states argued that FERC's 1996 order oversteps state authority over intrastate commerce set in the 1935 law, while Enron asserted FERC did not go far enough and should expand its authority to both retail and wholesale markets. Justice John Paul Stevens, said for the court majority: ''Whether or not the 1935 Congress foresaw the dramatic changes in the power industry that have occurred in recent decades, we are persuaded, as was the court of appeals, that FERC properly construed its statutory authority.'' Electricity groups called the action a major boost for the FERC's efforts to open the $220 billion U.S. electricity market to greater competition. ``(The action is a) major victory for wholesale power markets,'' said Mark Stultz, a spokesman for the Electric Power Supply Association. Jim Owen, a spokesman for the Edison Electric Institute said: ``The decision today reaffirms the wisdom of FERC's approach.'' The high court heard arguments in October on a case appealed from the U.S. Appeals Court for the District of Columbia, which upheld the FERC's authority to regulate state transmission in a June 2000 ruling. Enron -- once the largest U.S. wholesale power player and an ardent proponent of open markets and nationwide deregulation -- argued the FERC should have authority to force competition of all transmission assets. The Justices voted 6-3 to uphold the FERC's middle-ground approach to regulate unbundled retail transmission service, but not bundled services as Enron proposed. ``FERC's decision not to regulate bundled retail transmission was a statutorily permissible policy choice,'' Stevens wrote in his majority opinion. In a separate companion case, the state of New York argued the FERC went too far in regulating flows of electricity within the state. The high court voted unanimously to uphold the FERC, rejecting New York's request for the court to revoke the FERC's authority to regulate retail sales, because electricity involved in such sales stays within state boundaries and is not subject to federal regulation. ``FERC did not exceed its jurisdiction by including unbundled retain transmission within the scope of Order 888's open access requirement,'' Stevens wrote. The high court affirmed Order 888, which the FERC approved in 1996 after it found that transmission-owning utilities have an inherent incentive to bar access to their wires by competing companies. The order opened the grid to wholesale competition by forcing utilities to offer nondiscriminatory policies to energy firms that want to ship electricity over non-owned transmission lines.
Newspapers and Bank of Japan Are All Wrong About Bad Loans
A relative who works for a healthy credit union in the US asked me, What's your take on the bad loan problem that is supposed to be a crisis in Japan? If I was trying to explain it in a simple analogy, I first came up with this: Imagine trying to help someone who has cut an artery by applying a bandaid to the wound. But this is not it at all. Actually, the analogy is more like: Imagine trying to help someone who has cut an artery by sopping up the blood on the floor with a towel. The bad loans are merely an indicator of a depressed, deflated economy tied to an over-valued currency. The problems aren't going to be dealt with by 'increasing consumption' or 'writing off the bad loans' (this always sounds so harmless, but actually it means making banks and credit unions indebted to the gov't while forcibly stripping them of any potential for future profits should the economy actually turn up). Why in the hell should an economy burdened with all this and growing non-performing loan portfolios find a solution in making more loans? Who in the hell is going to borrow more? The Japanese economy has, in fact, undergone wave after wave of restructuring during the era of the high yen. What it needs now, most of all, is a reflated economy. If you take all the loans to all the businesses out there sitting in the books of financial institutions, surely there are some big corporate stinkers that deserve to be put out of their misery. But as a totality, there are also thousands of small and medium size businesses that are, by international standards, not that highly leveraged and with viable business plans. These companies are going to be the key to any turn around in the economy. It makes no sense to see foreclosing on them as the solution to the problems. It just seals Japan's doom. This is Hooveresque macroeconomic dictating when the microeconomics of banks, their analysts and the thousands of companies they have relationships with are the key to turning Japan around. Here is an interesting article that supports my claim. http://www.weeklypost.com/011105/011105b.htm#three Newspapers and Bank of Japan Are All Wrong About Bad Loans By Ryuichiro Matsubara, Professor of University of Tokyo Business pages of the Japanese newspapers are devoting much space to report on the issue of non-performing loans of financial institutions. It is understandable because the bailout of bad loans is the central core of Prime Minister Koizumi's structural reform. However, the contents of the stories are laughable. I am wondering whether newspapers and the Japanese government really have good understanding of the problem. Nikkei Newspaper says, "Surprisingly enough, the nature of the problem of the bad loans of Japanese financial institutions has not changed over the last ten years since the problem surfaced. Banks and financial authorities have never understood it fully. Banks have sabotaged the write-offs of these bad loans in their accounting books reflecting the reality of the problem." Asahi Newspaper says, "As long as fear exists in financial market and the financial system stays malfunctioning, the Japanese economy will not be able to get on the right track for recovery." What these newspapers are missing is the fact that recession occurs when supply exceeds demand in the economy, which eventually causes bad loans by the banks. Therefore, if the government leaves the situation of shortfall of demand against supply, the bad loans will keep increasing. The only solution for the problem is to bailout bad loans up to a level that will not cause a financial crisis. Demand has to be increased. What Asahi Newspaper is saying is if banks make loans to businesses and they invest for assets, their sales of the invested assets and products will be sold well. The Bank of Japan increased the money supply and is pressing banks to make more loans to businesses. However, demand is low and products are not selling well, which creates higher inventory. Investment by business corporations do not generate any return, which creates more bad loans. What newspapers are doing by printing their articles on bad loans is helping to increase the number of bad loans. The Japanese government is stressing that increasing supply is the basis for structural reform. That is wrong. It only causes a bad cycle from excessive supply, deepening the recession and causing more bad loans. The government keeps saying that it is aiming at bailing out bad loans based on a wrong understanding. The government and the newspapers are all wrong. -- Posted by Charles Jannuzi
Re: Re: Wade vs Wolf
On Monday, March 4, 2002 at 18:56:42 (-0500) Doug Henwood writes: >Michael Perelman wrote: > >>Wasn't Wade's point that much of the increase in inequality was within >>countries rather than between them? > >Well yeah, but there's a tendency in left discourse to bracket out >China, except to talk about sweatshops and political repression. The >U.S. recession has gotten far more PEN-L traffic than growth in >China, which has grown almost 10% a year over the last two decades. >How'd it happen? What'd it mean? What's happened to incomes across >the spectrum? Even if ineq increased, are the poor better off than >they were 10 or 20 years ago? India shows growth rates of almost 6% - >the same questions apply. I know growth is so much less fun than >crisis, but maybe a few words... I think Sen points out that though China has grown, mortality rates have gone up markedly since market reforms were instituted (in late '70s?). So average income goes up, while length of average life goes down. Bill
Re: Re: Wade vs Wolf
On Monday, March 4, 2002 at 18:57:45 (-0500) Doug Henwood writes: >Devine, James wrote: > >>In all of these income numbers, are non-market sources of subsistence >>measured? Is it possible that measured and reported gains in market income >>are cancelled out if one subtracts the effects of the abolition of the >>availability of non-capitalist means of subsistence (the end of the iron >>rice bowl policy in China, the end of non-commodity-producing traditional >>ways of life, etc.)? > >More excellent questions. Is anyone studying this now? Has Sen? Bill
Re: Re: Re: Wade vs Wolf
> the same questions apply. I know growth is > so much less fun than crisis, but maybe a few words... > > Doug Hi Doug, Let me ask you a direct question: Is it your point that capitalism is not as bad a system as some of us here think it is? Sabri
Re: Wade vs Wolf
Henwood: > Well yeah, but there's a tendency in left discourse to bracket out > China, except to talk about sweatshops and political repression. The > U.S. recession has gotten far more PEN-L traffic than growth in > China, which has grown almost 10% a year over the last two decades. Well, for a start , a lot of those figures are about as accurate as, say, unemployment figures from the US. Second, a lot of that growth has been 'robbing peter to pay paul' so to speak. As the east coast has boomed and pumped up the statistics, the interior has waned. You might say there just isn't enough of an accurate historical database about the Chinese economy to say much of anything except to say over the past 20 years it has changed a lot and it has grown some. Since 9-11 happened hardly anyone noticed China's acceptance into the WTO--at least all those globally minded Americans hardly noticed. > How'd it happen? What'd it mean? What's happened to incomes across > the spectrum? Even if ineq increased, are the poor better off than > they were 10 or 20 years ago? The China model is, I know it sounds trite, unique. It combines the US penchant for pumping money into research, development and the economy via the military and space/missile/aerospace programs while it also follows a somewhat Japanese model for development, at least on the east coast. In that sense, the gov't plans how to make capital for development and building readily available. I'm not sure China will be as successful at taking full development into the hinterland the way Japan did (the side of Japan most Americans know nothing about but which figures heavily in Japan politics and in its economy). One thing that has really helped China is the investment into China from the US, Japan and Korea (a lot of it profitable but probably non-productive cronyism if you look at the Bush family portfolio). It's been Japan with S. Korean chaebol as well that have been largely responsible for the building of modern factories able to churn out custom-fitted but factory-made suits, computers, DVD players, and white goods. Also, the US cheap dollar/strong yen policy has pushed China into the fore as huge exporter to both the US and Japan (Japan has a very large account deficit with China). This is why the Chinese are now upset by any depreciation of the yen, even if it is short-term (as are a lot of currency speculators whose constant source of money was always betting against that depreciation). The Chinese I meet and get to know in Japan still act like they come from a secretive and repressive society. For example, one might have a girlfriend from China but he doesn't want the other Chinese to know they are together or that she is even here in Japan. And these people are in Japan because they have connections to the CP, otherwise they wouldn't be permitted to leave China. If you get them actually talking about China as they know it, they talk of uneven development (city vs. countryside, east coast vs. the interior, SE vs. most of the rest of the country), loss of farmland and ecological destruction, enormous pollution and waste problems, and social disruptions (everyone trying to move to the east coast, people leaving farming to try for work in the cities, even if it means camping out under a bridge). Most Chinese I know here are economic and political immigrants in true senses of those words; they would prefer to stay in Japan than go back after they've lived a while here. One of my best friends, who is from China, says he doesn't want to go back because he loves the social freedom of Japan and hates the prevalent crime in the Chinese provinces (he doesn't come from an east coast city, but rather the deep interior). When we were taking a summer hike in the peaceful Japanese countryside I asked him what his part of China was like. He said, lots of countryside but you wouldn't walk through it like this because of bandits. He's also increasingly uncomfortable with being identified as 'Chinese' in Japan because recent Chinese immigrants are associated with crime waves in the Kanto. His hope for a future job is connected with helping (I won't name the company but it's a famous brand), an electronics company with several factories here in Fukui, to set up production somewhere in 'green field' China. His father has lived in Japan and worked for them, as does his older brother. If China can resolve its Taiwan issue peacefully (though the Koreas could be equally cataclysmic for China) and meet its fast-growing energy needs (a bif IF), it's set to surpass Japan in GNP in a decade and the US in two. But that's also because of its enormous population. I almost think the elite in Japan would be happy to see the US concentrate its often aggressive and manipulative foreign and trade policies toward China while Japan slips into some sort of 'Italy' or 'Sweden' status. Hard to do, though, if you have no EU to tie yourself to. Charles Jannuzi Fukui, Japan
Re: Tax haven hall of shame
Gazing at all the relics that the internet has washed up on my pc via google, I see a veritable who's who of US equity in on the same Cayman Is tax scams as Enron: AIG, CreditSuisse/First Boston (apparently a real enabler for Enron who started wanting it all as well), Ripplewood, Lonestar, and of course, the Bush and Bin Ladens' investment vehicle of choice, the Carlyle Group. AIG had a lot of money sunk into the dodgy, scheming Enron ventures everyone is talking about. Charles Jannuzi
Re: Re: RE: Wade vs Wolf
- Original Message - From: "Doug Henwood" <[EMAIL PROTECTED]> To: <[EMAIL PROTECTED]> Sent: Monday, March 04, 2002 3:57 PM Subject: [PEN-L:23500] Re: RE: Wade vs Wolf > Devine, James wrote: > > >In all of these income numbers, are non-market sources of subsistence > >measured? Is it possible that measured and reported gains in market income > >are cancelled out if one subtracts the effects of the abolition of the > >availability of non-capitalist means of subsistence (the end of the iron > >rice bowl policy in China, the end of non-commodity-producing traditional > >ways of life, etc.)? > > More excellent questions. Is anyone studying this now? > > Doug Has digging potential http://www.chinaonline.com http://www.chinaonline.com/features/chinaonline2/research.htm Ian
Re: Re: Wade vs Wolf
See UNU/WIDER paper by Cornia and Court (2001) "Inequality, Growth and Poverty in the Era of Liberalization and Globalization) on these issues. Cheers, Anthony Anthony P. D'Costa Associate Professor Ph: (253) 692-4462 Comparative International Development Fax: (253) 692-5718 University of WashingtonBox Number: 358436 1900 Commerce Street Tacoma, WA 98402, USA xxx On Mon, 4 Mar 2002, Doug Henwood wrote: > Ian Murray wrote: > > >However, this result comes from fast growth > >in China and India. If they are excluded this measure of > >inequality shows no obvious trend since 1980. > > Well yeah, but China and India together account for 44% of the > "developing" world's population. I can see the point of excluding > them, but still, they're not exactly footnotes to the real story. > > Doug > >
RE: Wade vs Wolf
Martin [Wolf?] writes: >Economic growth is, almost inevitably, uneven. Some countries, regions and people do better than others. The result is growing inequality. To regret that is to regret the growth itself. < according to Kuznets, after awhile growth is supposed to help _fight_ inequality (as trickle-down finally kicks in). Is Martin denying this? This denial sure does fit the story of the US since 1980 or so, where we Amurricans have seen "the far side of the Kuznets curve" (to paraphrase Doug Henwood) with increasing inequality despite sustained GDP growth. I guess Wolf's message is that he really doesn't care about inequality. Is it possible that growth, properly defined as something distinct from an increase in market-oriented measures such as GDP, might occur without increasing inequality, but that marketization is almost always associated with increasing inequality? Jim Devine [EMAIL PROTECTED] & http://bellarmine.lmu.edu/~jdevine
Re: RE: Wade vs Wolf
Devine, James wrote: >In all of these income numbers, are non-market sources of subsistence >measured? Is it possible that measured and reported gains in market income >are cancelled out if one subtracts the effects of the abolition of the >availability of non-capitalist means of subsistence (the end of the iron >rice bowl policy in China, the end of non-commodity-producing traditional >ways of life, etc.)? More excellent questions. Is anyone studying this now? Doug
Re: Re: Re: Wade vs Wolf
Michael Perelman wrote: >Wasn't Wade's point that much of the increase in inequality was within >countries rather than between them? Well yeah, but there's a tendency in left discourse to bracket out China, except to talk about sweatshops and political repression. The U.S. recession has gotten far more PEN-L traffic than growth in China, which has grown almost 10% a year over the last two decades. How'd it happen? What'd it mean? What's happened to incomes across the spectrum? Even if ineq increased, are the poor better off than they were 10 or 20 years ago? India shows growth rates of almost 6% - the same questions apply. I know growth is so much less fun than crisis, but maybe a few words... Doug
Tax haven hall of shame
Economist.com Friday March 1st 2002 Tax haven hall of shame >From The Economist Global Agenda The collapse of Enron has brought to light a problem that has plagued rich economies for some years: the existence of tax havens through which big corporations can legitimately avoid tax. The Organisation for Economic Co-operation and Development is threatening sanctions against unco-operative tax havens AMID the mess that is Enron, one newly revealed fact which has shocked many is that Enron avoided paying federal taxes in four out of the past five years, despite reporting huge profits. This is now the subject of one of the many congressional inquiries at the former energy trader. But the companys success at tax avoidance should not really be that shocking. Most big American companies, like most multinational firms based anywhere, have used tax havens at one time or another. Tax havens have worried the Organisation of Economic Co-operation and Development (OECD), the rich-country club, for some years. Two years ago it published a blacklist of 35 territories, many of them small island nations, whose tax codes it alleges were written specifically to help large companies shield themselves from the tax regimes of big, rich nations. These havens were given until February 28th this year to promise certain changes if they wished to avoid sanctions by OECD member states. The subject of tax havens has also been bound up with that of money laundering, an issue which has become especially urgent following the terrorist attacks on the United States on September 11th last year. Many tax havens are also infamous for their undemanding financial-reporting requirements. So they often make ideal homes for hot money, as well as money earned by legitimate businesses. The OECD has a separate, long-standing task force to tackle money laundering. In the wake of September 11th, many countries, including rich countries such as Britain, have agreed to tighten up their own procedures. However, the OECD is eager to make a distinction between the two practices, apparently because it fears that its efforts to crack down on money laundering may be diluted by a close association with its parallel efforts to constrain tax havens. The reason is clear: most people are against money laundering, which is clearly criminal. But tax havens are a much more controversial issue. Many people are sympathetic to the blacklisted nations defence that their low-tax regimes are a perfectly legal and respectable form of regulatory competition, and that the OECD efforts will deprive them of legitimate business. Moreover, there is some sympathy for those trying to shield income from corrupt and discriminatory governments who do not operate fair and open tax regimes themselves. The OECD defines tax havens as countries that fulfil a number of criteria. These include levying little or no income tax; refusing to exchange information with tax authorities in other countries; lack of transparency and lack of substantial activitiesie, a real business purpose aside from avoiding taxes. Eager to rebut the charge that it is a cartel protecting the high-taxation policies of its rich-member countries, the OECD insists that low or no taxation is not enough in itself to earn the tax haven tag, and attaches as much significance to information-sharing practices. (These, not coincidentally, would also combat money laundering.) Six jurisdictions that would otherwise have aroused suspicionBermuda, Cayman Islands, Cyprus, Malta, Mauritius and San Marinomade advance commitments to the OECD that ensured that they never got on to the initial tax-haven list published in 2000. After that, ten more territoriesAntigua and Barbuda, Aruba, Bahrain, the Isle of Man, the Netherlands Antilles, the Seychelles, the Channel Islands of Jersey and Guernsey, Grenada and St Vincent and the Grenadinesalso promised to make changes that have satisfied the OECD, while a further twoBarbados and Tongahave been removed from the tax-haven blacklist after implementing bilateral information-exchange agreements. That leaves 23 remaining suspects. The British dependency of Gibraltar, the British Virgin Islands and St Lucia, both in the Caribbean, and the Cook Islands in the Pacific have all said that they have offered to make commitments about information exchange, but the OECD has yet to ratify such offers. Vanuatu, a Pacific Island said to be favoured by wealthy Russians, has said that it will not be making any concessions to the OECD. The international body is still considering several proposals and is likely to make further statements over the coming weeks before issuing a final blacklist. The OECD has not yet said what sanctions it will apply to recalcitrant countries, though it has laid out a list of defensive actions, all of them fiscal. One of the most important is the threat to cancel tax treaties. These are usually agreements for deciding which countries tax regime applies, and not
RE: Wade vs Wolf
In all of these income numbers, are non-market sources of subsistence measured? Is it possible that measured and reported gains in market income are cancelled out if one subtracts the effects of the abolition of the availability of non-capitalist means of subsistence (the end of the iron rice bowl policy in China, the end of non-commodity-producing traditional ways of life, etc.)? JD
Re: Re: Wade vs Wolf
Wasn't Wade's point that much of the increase in inequality was within countries rather than between them? On Mon, Mar 04, 2002 at 06:28:13PM -0500, Doug Henwood wrote: > Ian Murray wrote: > > >However, this result comes from fast growth > >in China and India. If they are excluded this measure of > >inequality shows no obvious trend since 1980. > > Well yeah, but China and India together account for 44% of the > "developing" world's population. I can see the point of excluding > them, but still, they're not exactly footnotes to the real story. > > Doug > -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail [EMAIL PROTECTED]
Re: Wade vs Wolf
Ian Murray wrote: >However, this result comes from fast growth >in China and India. If they are excluded this measure of >inequality shows no obvious trend since 1980. Well yeah, but China and India together account for 44% of the "developing" world's population. I can see the point of excluding them, but still, they're not exactly footnotes to the real story. Doug
Wade vs Wolf
< http://www.prospect-magazine.co.uk > Are global poverty and inequality getting worse? Dear Martin 22nd January 2002 You have written eloquently in the Financial Times about globalisation. You make three main points. (1) Poverty and inequality on a world scale have both fallen over the past two decades for the first time in more than 150 years. (2) These falls are due to greater global economic integration. (3) The anti-globalisation movement encourages countries to adopt policies that will in fact only intensify their poverty and inequality. Let us take the first point about trends in poverty and inequality. If you are wrong here, the rest of your argument begins to wobble and, in fact, there are reasons to doubt what you say. On poverty, the World Bank is the main source of numbers. Bank researchers have found that the number of people in absolute poverty (with incomes less than about $1 per day) was roughly constant in 1987 and 1998, at around 1.2 billion. Since world population increased, the proportion of the world's population in absolute poverty fell sharply from around 28 per cent to 24 per cent in only 11 years. This is good news. But recent research on where the Bank got the 1.2 billion suggests that the method for calculating the numbers is questionable. The effect is probably to understate the true numbers in poverty. How much higher than 1.2 billion we do not yet know. So what is happening to global inequality? It is widening rapidly, if we compare the average incomes for each country and treat each one as a unit (China = Uganda). Yet income inequality among countries has become more equal, since around 1980, if we compare the average incomes for each country and weight each one by its population. However, this result comes from fast growth in China and India. If they are excluded this measure of inequality shows no obvious trend since 1980. In any case, this measure-using the average income of each country weighted by population-is interesting only as an approximation to what we are really interested in, which is the income distribution among all the world's people or households, regardless of where they live. The problem is that we do not have good data for the incomes of all the world's people. You say that global inequality amongst households has probably fallen. But the most comprehensive data on world incomes, based on household income and expenditure surveys, find a sharp increase in inequality over as short a time as 1988 to 1993. Some of this may be statistical error; but the results do mean that the balance of probability falls in the direction of increasing global inequality among households. This conclusion is strengthened by the trends in industrial pay inequality within countries. Pay inequality within countries was stable or declining from the early 1960s to 1982, then sharply increased from 1982 to the present. The year 1982 was a dramatic turning point towards greater inequality within the world's countries. Doesn't the fast growth of populous China and India create a presumption that world income distribution is becoming more equal? No. At low levels of income, growth has to be fast for a long time before the absolute gap with slow-growing, high income countries begins to fall. The absolute income gap between a developing country with an average income of $1,000 a year, growing at 6 per cent, and a developed country with average income of $30,000, growing at 1 per cent, continues to widen until after the 40th year. China and India are not reducing the gap between their average incomes and the averages of the countries of western Europe, North America and Japan. They are, though, closing the gap with the faltering, middle-income states like Mexico, Brazil, Russia and Argentina, which is why average inequality among countries has become more equal since around 1980. But this reduction in the gap between China and India and the middle-income states is probably offset by widening income inequality within the two giants. Perhaps all the thunder and lightning about the trends diverts attention from the main issue: the sheer magnitude of poverty and inequality on a world scale. The magnitude is unacceptable, regardless of the trend, and the world development agenda should make inequality reduction (not only poverty reduction) a high priority. Roughly 85 per cent of world income goes to 20 per cent of the world's population and 6 per cent to 60 per cent of the world's population. Can this meet any plausible test of legitimacy? It is difficult to see how it could meet the Rawlsian principle that a given degree of inequality is acceptable if it is necessary for the worst off to become better off. Integration/globalisation is nothing like the engine of development you say it is. The engine is the advance of technology and the diffusion of technical capacities of people, firms and governments. Some forms of integration may help this, others may hinder it, depending partly o
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Re: Suppression of Marx
> CB: In Engels' day, and in Lenin's, even if there was a global limit , there was no need to wait for that limit to have the world revolution. Today, we may not even approach the limit really. > First, there is no "global limit" in "marxist-leninist" theory because, according to it, endogenous accumulation is possible, so that capitalism can be endless, like in "social-democrat" theory. The only difference between these two therories is, that the one leads to the conclusion that capitalism must be cancelled by a revolution, while the second one concludes that socialism must be constructed within capitalism. But the very theoretical base is the same. Second, we do approach really the limit, whose name is "globalization". Third, not only there is "no need to wait for that limit to have the world revolution", but waiting for it will allow capitalism to bring the whole civilization with him to grave, as it is doing before our very eyes. Additionally, this argument was never put forward by Rosa Luxemburg. It was one of the Marxist-Leninist forgeries to ban Luxemburgian thought. RK
Finally a democratic airline
If it had been flying to North Korea, Iran, or Iraq it would have been much worse! Cheers, Ken Hanly Italian Plane Passengers See Flames, Vote to Land Mon Mar 4,10:14 AM ET MILAN (Reuters) - The pilot of a charter flight to Cuba from Italy that burst into flames during takeoff had passengers vote on whether to continue the 5,000-mile journey. The passengers, who had seen flames stream from one of the Yesair jet's engines, voted overwhelmingly in favor of returning to the ground, officials at Milan's Malpensa airport said on Monday. The pilot managed to get the plane into the air and announced that he had resolved the problem with the engine and planned to carry on to Cuba on the Sunday flight. But his reassurances failed to calm nerves among the 250 passengers and he called for the vote. Passengers, who had panicked after seeing the flames and smelled smoke in the cabin, told reporters that almost all of them had demanded to return to Malpensa. "I saw flames, it was incredible. It looked like the whole engine was about to go up," one unnamed passenger told state television news. No one from the Portuguese charter company Yesair was immediately available for comment, but an airline source in Milan said the plane had not been in danger. "One of the engines stalled very briefly. It turned itself off and then on again and there were flames. Apparently it is quite normal," he said, declining to be named. "The passengers saw the flames. Obviously they were scared. The captain asked them what they wanted to do -- continue across the Atlantic or return to the airport," he said. The airline source said it was not normal to let passengers decide the fate of a flight. The holidaymakers were scheduled to fly to Cuba aboard a different plane on Monday
MIT study flawed.
MIT team tied to questionable missile studies By David Abel, Globe Staff, 3/4/2002 A Pentagon agency, two major military contractors, and an independent research team led by MIT scientists produced flawed studies that exaggerated the success of a key test used to justify spending billions of dollars on the fledgling national missile defense program, according to two reports obtained by the Globe. The long-awaited reports, to be released today by the General Accounting Office, detail the flawed analysis of critical missile-defense technologies provided by the contractors, Boeing Co. and TRW, verified by senior researchers at the Massachusetts Institute of Technology's Lincoln Laboratory, and hailed by the Pentagon's recently renamed Missile Defense Agency. In reports about a highly sophisticated sensor used in the first test of the missile-defense program - a technology similar to one now designed for the vital task of distinguishing decoys from warheads - contractors described its performance as ''excellent'' and the overall test as a ''success.'' The team directed by two MIT scientists, which evaluated the contractors' reports of the test, pronounced them ''basically sound.'' And officials in the Missile Defense Agency called the first test of the technology in space ''highly successful.'' Yet the review by the GAO, the investigative arm of Congress, found that crucial elements of the 1997 test failed - prompting investigators to raise questions about the oversight of a program that has already cost billions of dollars and could, if the Bush administration has its way, ultimately cost taxpayers as much as $238 billion, according to a recent estimate by the Congressional Budget Office. ''The data are garbage - they had to use all these software shenanigans and throw out two-thirds of the data to make it look like a success,'' said a congressional source close to the GAO investigation. ''Up to now, there has been no independent verification of the contractors' claims. This pulls out the rug from those calling the test a success. By any definition, there's no way to call it a success.'' The main defect in the test, according to the GAO, was that the infrared sensor built by Boeing failed to cool to a sufficient temperature to function properly. Also, the power supply of the sensor turned out to be much louder than expected. The excess heat and noise, missile specialists said, caused a significant distortion, by a factor of up to 200 times, in the ability of the sensor to detect targets. As a result, the sensor often detected targets where none existed. The performance of the sensor is crucial because the planned land-based national missile defense system might have only one chance to hit its target. And once the military launches an antimissile against an incoming ballistic missile, military analysts say they believe it would almost certainly face a barrage of decoys. Moving at great speeds, it would have to distinguish the fake from the real in a matter of minutes. Regarding what became known in defense circles as the ''MIT study,'' a review of the contractors' findings that the Pentagon used to champion missile defense spending, the GAO faulted the team led by scientists at Lincoln Lab for relying on data processed by TRW - instead of seeking the contractor's raw data. Although the team reported that TRW's sensor contained a few software glitches, GAO investigators said the scientists' use of the processed data allowed them to review only 14 of 54 seconds worth of data. The limited look at the sensor's performance, according to the GAO, skewed the scientists' review and led them to pronounce the sensor's software well designed and say it worked properly. The failure to review the raw data, investigators wrote in the report, means ''the team cannot be said to have definitively proved or disproved TRW's claim that its software successfully discriminated the mock warhead from the decoys.'' For MIT physicist Theodore Postol, a frequent critic of the Pentagon's missile defense plans, the omissions of his colleagues and their stamp of approval for the Missile Defense Agency amounts to scientific fraud. Postol recently lodged complaints with the MIT Corporation about the study - charging that the university's president, Charles M. Vest, knew of the alleged misconduct and did nothing about it. ''This certainly has the appearance of a well-orchestrated fraud,'' Postol said. ''The managers at Lincoln Lab either knew or should have known that this experiment was a total failure - and they falsely represented it as a success. The implications of that deceit could cost taxpayers hundreds of billions of dollars.'' MIT officials did not return calls for comment. But Roger Sudbury, a spokesman for Lincoln Lab, told the Globe last month that the Lexington-based research arm of MIT received no complaints from contractors o
Re: A role for static analysis?
> Whether or not that's a sufficient condition > to be "not impressed" with a work in political > economy is a judgment call, of course. I'm certainly > not insisting one must be impressed by Roemer's work. > But there exist many very insightful contributions > to the understanding of capitalism that are > based on essentially static conditions. This would > include Marx's analysis of the basis of surplus value > in Chapters 1-7 of Capital Volume I, which incorporates > no dynamic elements whatsoever. Is his analysis here > therefore unimpressive? > >Gil Dear Gil, I accept defeat, not that I thought we were in a battle. As Melvin said: Hey, "space is the final frontier, these are the voyages of the starship l-Pen, on its continuing mission to figure out what the hell is going on." I guess this is why I like PEN-L so much. Best, Sabri
materialist theory of history
materialist theory of history by Devine, James [cf. Brenner -- since Marx never studied feudalism seriously]. ^ CB: Engels studied feudalism seriously cf. book on german peasant revolts
Suppression of Marx
As for her, Rosa Luxemburg, although she hoped and prayed for the "proletarian revolution", had understood that the accumulation could not be endogenous and on the contrary needed an expansion within space, what was attested by colonialism. She logically concluded that this expansionism was necessarily to come up against a deadline, should it be in last resort the planetary one. In other words, "capitalism" was necessarily to one day enter a crisis of which it could not getting out. This thesis had to experience a censorship and a purgatory that are continuing. CB: In Engels' day, and in Lenin's, even if there was a global limit , there was no need to wait for that limit to have the world revolution. Today, we may not even approach the limit really.
Powers of destruction
Powers of destruction by Charles Brown 04 March 2002 16:18 UTC : SDTHE GI AS TERMINATOR From: [EMAIL PROTECTED] Subject: SDTHE GI AS TERMINATOR The following article appeared in the March 1, 2002, issue of the Mid-Hudson (NY) Activist Newsletter, published in New Paltz, NY. THE GI AS TERMINATOR The Pentagon is not content with simply possessing more destructive military machinery than all other nations combined. It wants to train and equip the individual GI to become a super-killer as well. According to a press release we received from the government's Oak Ridge (Tenn.) National Laboratory (ORNL) Feb. 21, "Arnold Schwarzenegger as The Terminator has nothing over the Objective Force Warrior ^ CB: That's "Force", as in physics, force, power and violence. "Violence" is a human historical term. ^^ envisioned by the Army and a team from the ORNL and organizations throughout the country." We contacted Oak Ridge to make sure the announcement wasn't a satire or hoax, and were assured by Ron Walli, the lab's public relations person, ^^ CB: public relations, as in relations of production and destruction. ^ that it was genuine. The goal of the Objective Force Warrior project, we were informed, "is to develop a high-tech soldier with 20 times the capability of today's warrior and to have that soldier commissioned by about 2010. With advanced technologies, the army plans to create an overmatch and greatly minimize danger to its soldiers." George Fisher, the head of ORNL's National Security Directorate, says "the Army wants to stretch the bounds of technology but still have something that is feasible and can be built." Innovative technologies, he continued, "would allow a soldier to engage and destroy the enemy at longer ranges and greater precision and with devastating results. Technologies that would make that possible include better communications devices, advanced situational awareness software, chem-bio detection and protection, advanced weapons, and protective equipment." Walli's press release noted that "Fatigues and the flak jacket of the past ... would be replaced by a system designed to protect a soldier and provide hemorrhage control in case a bullet penetrates. The helmet of the future warrior might be a sealed unit that contains communications, vision enhancement, a laser for target ranging and a heads-up display." Fisher said the Army asked the lab to "coordinate a unique visioning process" for the Terminator GI because of its "unique capabilities and its connections to industry, institutions and technologies." Groups working with ORNL on the project include the Picatinny Arsenal, the U.S. Armor Center, Yale University, and the NASA Langley Research, among others.
Re: Mandarinism, was Re: Rigor mortis?
> >"Devine, James" wrote: > > > > > > this fits with my sense that economists embrace math so fervently partly > > because it provides a basis for Mandarinism. (Mandarinism refers to the > > pre-20th century practice of requiring would-be Chinese state >bureaucrats to > > take examinations in stuff like calligraphy that had nothing at all to >do > > with their ability to rule.) Or teaching Latin and Greek to the British ruling class. But I think it is rather charming that it was expected that Chinese mandarins were expected to be proficient in calligraphy and poetry and have a solid grounding in classical literature, or that little Brit lordings were supposed to know their Homer and their Ovid. TE Lawrence (he of Arabia), for example, turned out a highly creditable translation of the Odyessy. Made them much more interesting people than the narrow and ignorant technocrats who rule us, no? > >In an article he wrote many years ago Andre Gorz reports visiting one of >the more exclusive technological academies in France. He asked someone, >what do you teach here that couldn't be learned on the job in the >factory. The reply, calculus. Next question, will they need calculus to >do the work? No. Still, can't hurt to learn it. When I teaching, we (Solidarity) invited a woman from a left spinter of Solidarnisc, a metal worker, on a tour; she spoke to my class, and was alarmed at how ignorant these juniors and seniors were. I explaned to her what their educational background was, and she was shocked. She had never been to university, just technical high school, had been taught math through calculus, and had to know two foreign languages--one modern (English [hers], Russian, or German, andone classical--hers wasLatin). This was a factory worker, you understand, a machine lathe operator. > >So this practice can not only be used to filter out a ruling elite >(China) or an elite band of lackeys (economics) but to create >pseudo-elites within the working class. And since the economists can be >divided into (a) those at the elite universities, thinktanks, corp >staffs, etc) and (b) those at all the non-elite schools, we find that >economist training both recruits elite lackeys and divides the working >class. > Yes. Better they should learn calligraphy and Greek. If math, something really useless, like number theory or topology. jks _ Join the worlds largest e-mail service with MSN Hotmail. http://www.hotmail.com
B&ESI 2002 / CALL FOR PARTICIPANTS - Business & Economics Conf. / Montreal, July 24-29
* BUSINESS & ECONOMICS SOCIETY INTERNATIONAL (2002 CONFERENCE MONTREAL - QUEBEC / CANADA July 24-29, 2002 Delta Montreal Hotel * CALL FOR PARTICIPANTS (Deadline for Abstracts and Early Registration: March 30, 2002) The Business & Economics Society International (B&ESI) invites you to participate in its 2002 Conference to be held in Montreal - Quebec / Canada, at the Delta Montreal Hotel, July 24-29. The conference welcomes academics (business/economics professors and administrators), as well as corporation/government executives and economists. Participants may organize panels (please ask for the "Panel Organizer Guidelines"), present papers, participate in poster sessions, chair sessions, discuss papers, participate in round-table discussions, or simply observe. The program will consist of: · small concurrent sessions with: chairperson, presenters, and at least one discussant assigned to comment on each paper; · poster sessions; · roundtable thematic discussion sessions with moderator; · workshops and panels; · invited speakers. Time allocated for each session is one hour and 30 minutes. * To ORGANIZE PANELS please ask for "Panel Organizer Guidelines". The fee for each participant in the panel, except the organizer, is $315. The fee for the panel organizer is $150. * To participate as a PRESENTER please submit ABSTRACTS and/or PAPERS: ABSTRACT/PAPER SUBMISSION AND REGISTRATION DEADLINE: MARCH 30, 2002 · Please, submit your abstract (of no more than 200 words) via e-mail ([EMAIL PROTECTED]) by MARCH 30, 2002. Additionally, mail two hard copies of your abstract (see address below). All abstracts submitted will be evaluated for presentation and publication in the Book of Abstracts which will be available at the Conference; · You may submit abstracts for no more than 2 papers; · Abstracts/papers must not have been published, accepted, or submitted for publication elsewhere; · The categories that best fit your paper must be typed on the top right corner of the front page (See below table titled "Subject Category Title and Number"); · For co-authorships please include names, affiliations, and addresses of all authors and indicate who will serve as presenter; · The title of your abstract(s) or paper(s) is(are): __ ___ FINAL PAPER SUBMISSION DEADLINE: APRIL 30, 2002 · Please submit via post 2 hard copies of the paper(s) and a disk containing the manuscript(s) in Word by APRIL 30, 2002. · Unless you instruct us otherwise, all papers will pass a blind peer review process for publication consideration in the 'GLOBAL BUSINESS & ECONOMICS REVIEW - ANTHOLOGY 2002', a volume of selected papers from the Conference. Format instructions will be attached to the acceptance for publication letter. [Manuscripts of more than 12 single-spaced pages of text (font: times, size=10) inclusive of graphs, tables, end-notes and references will be considered at $10 per additional page]; · Authorship should be identified only on a removable cover page. CONFERENCE REGISTRATION FORM Last Name __ First Name and M.I. ___ Nickname for Badge ___ Position/Title/Rank Affiliation Mailing Address __ Telephone: Day (___) , Night (___)_ Fax: (___)_ , E-Mail: ___ [I wish to serve as a DISCUSSANT and/or a SESSION CHAIR/MODERATOR.My specialty is. "Session Chair/Moderator and Discussant Guidelines" as well as copies of the abstracts or papers to be discussed will be emailed or mailed to you as soon as the sessions are organized.] CONFERENCE FEES (DUE MARCH 30, 2002) 1. Registration Fee ...$315 x __ = __ 2. Parti
RE: Question to Various comments in In Digest 77
> CB: Doesn't _The Manifesto of the Communist Party_ make it > pretty clear that Marx's theory of history is rooted in the > relations of production aspect of the forces of production, > the division of labor, and the class struggle ? History is a > history of class struggles, not technological innovations. > Since producers are part of the forces of production , it is > their development that is in the forces of production that > makes history, and historical revolutions. One of the problems is that the categories "relations of production" and "forces of production" overlap. The division of labor, for example, is both a relationship among producers (part of the RofP) and promotes the productivity of labor (part of the FoP). JD
RE: Macro, micro, and Marx's method
I'm sorry this took so long, but maybe it was worth it.
Gil writes: >Jim raises a number of interesting issues that go well beyond
the simple point I suggested re Marx's V. III "transformation of commodity
values into prices of production." I react to some of these points below.
Those not interested in metatheoretical/pedagogical issues respecting Marx's
analysis in Capital should hit the delete key now. <
oops! I hit the delete key ... time to recover.
>1. "Macro" vs. "Micro" in Marx<
I wrote:
>Unlike modern orthodox economics which starts with so-called
>"microfoundations" and tries to explain all macro phenomena, Marx started
>(in volume I) with "macro" issues, the conflict in production between
>abstract capital and abstract labor (since he abstracts from the use-value
>of all commodities except labor-power) on the level of capitalist society
as
>a whole. That is, he uses his "law of value" to break through the
confusions
>implied by commodity production, i.e., the fetishism of commodities, to
>focus on what he thought was most important, the societal capital/labor
>relationship _in general_.
Gil writes: >Of course, Marx wrote before a clear line of demarcation
between "macro-" and "micro-"economics was established in mainstream
analysis, so it's no surprise that Marx didn't pay much respect to a
theoretical boundary line that didn't as yet exist. And for a reason
detailed below, drawing a strict micro/macro partition is necessarily harder
to do in Marxland than Mainstreamland. <
Marxland? where's that? when can I move there?
Strictly speaking the macro/micro distinction was applied, for example, in
the debate about "general gluts" (in the early 1800s), though only in crude
ways. Ricardo or Smith leaned heavily toward micro (or at least toward
"microfoundations" reductionism), as seen by their acceptance of Say's
"Law." On the other hand, folks like Malthus and Sismondi leaned toward
macro, as seen in their rejection of that "Law." Marx clearly joined the
latter camp, in section 2a of chapter 3 of vol. I (p. 113 of the 1967
International Publishers' edition), where a general glut of physical
commodities is seen as corresponding to a shortage of money. (My restatement
is in Walras-speak, rather than Marx-speak.)
BTW, it shouldn't be presumed that just because the macro/micro "partition"
is harder to draw in Marx's work than in orthodox economics, that this is a
problem, somehow a deficiency in Marx. To my mind, the line between macro
and micro is artificial in many ways. It's an analytical distinction to be
ignored once one gets to the synthetic phase of understanding.
>Applying standard definitions retroactively, though, one can see where and
how Marx crosses the line in _Capital_. By these definitions, Marx's
starting point in V. I. is apparently "micro" in nature, in the specific
sense that no reference to any economic aggregate is made in initiating his
argument. He starts by describing capitalist wealth as a collection {a
collection, note, not an aggregate; he's introduced no basis for aggregating
heterogeneous commodities as yet}. <
Strictly speaking, Marx starts his _Capital_ by saying "The wealth of those
societies, in which the capitalist mode of production reigns, presents
itself as an heap of commodities." (from Hans Ehrbar's translation at
http://www.econ.utah.edu/ehrbar/akmc.htm). Marx's concern is clearly with
"the wealth of those [capitalist] societies." This indicates that Marx's
focus is on _society_, not individuals in that society or even individual
commodities. As Ehrbar makes clear, the focus is on commodities as a
_social_ form of wealth, as a kind of wealth the character of which is
profoundly shaped by its societal environment. Thus, the focus involves
macro from the beginning, since one can't talk about a "society" without
seeing it as being some sort of totality.
Note that Marx uses the phrase "presents itself." Anyone familiar with the
later discussion of the fetishism of commodities (chapter 1, section 4 of
volume I; see also section VII of volume III of _Capital_) should be alerted
by this phrase. Capitalism _appears_ to be merely a "heap" of commodities,
but this does not correspond to the capitalist "essence" that's hidden from
the casual observer looking at matters from within the system. In this
light, the word "heap" - - or "collection" - - is ironic: capitalist wealth
_seems_ to be a "heap," but it's not really so.
The later discussion of commodity fetishism of course makes it quite clear
that the book is about society, not microeconomics. From the start, Marx
rejects the extreme micro-type thinking that Margaret Thatcher expressed
when she said that there's no such thing as society, only individuals. (BTW,
professional economists of the _laissez-faire_ stripe expressed this type of
opinion many times in different ways before she did so.)
Gil continues: >He then introduces a qualitative distinction between the use
value and exchange value of
RE: Re: RE: Suppression of Marx
I think that the answer to Michael's question is yet to be fully answered. Sraffa's papers were for many years not available to most people. I have made the argument that there is a difference between Sraffa and the Sraffians myself, or at least that Sraffa is open to other interpretations, but the former is not an easy argument to make for a few reasons. One is that clearly three of Sraffa's closest students were Garegnani, Bharadwaj, and Schefold--all neo-Ricardians. While the argument about other legitimate interpretations of Sraffa is aided by both the fact that he published so little and his writing style, one must deal with the fact that Sraffa was alive during the publication of lots of the neo-Ricardian core work and in close contact with the authors (including cited for thanks for comments in many of the key papers). So it is hard to imagine that he was strongly opposed to the way the neo-R's developed his ideas... By the way, the argument that Sraffa's own work was wholly negative (criticizing others) is not true. He did also offer positive contributions. -Original Message- From: Michael Perelman [mailto:[EMAIL PROTECTED]] Sent: Monday, March 04, 2002 10:22 AM To: [EMAIL PROTECTED] Subject: [PEN-L:23464] Re: RE: Suppression of Marx Was Sraffa a Sraffian/neo-Ricardian; did he ever go beyond critiquing neo-classical garbage?
Question to Various comments in In Digest 77
Question to Various comments in In Digest 77 by Davies, Daniel -clip- And whatever else one thinks about Cohen's work, I think he has to be right that Marx had a theory of history, and that this theory of history was materialsit and based on the productive forces. 'course, I never understood dialectics, so I may be talking out of my hole. ^ CB: Doesn't _The Manifesto of the Communist Party_ make it pretty clear that Marx's theory of history is rooted in the relations of production aspect of the forces of production, the division of labor, and the class struggle ? History is a history of class struggles, not technological innovations. Since producers are part of the forces of production , it is their development that is in the forces of production that makes history, and historical revolutions.
RE: Re: Rigor mortis?
Jim D wrote, > I think it's important to remember that the phrase "the real world" is > redundant. I guess this depends on one's epistemology, but I don't want to start any discussion about epistemology. Pen-l seems to have a lot on its plate now. ;>) > Also, isn't it more accurate to say tht math models can clarify one's > thinking about "possible mechanisms and connections" instead of allowing > them to be discovered? The discovery seems to be a > pre-mathematical stage of the analysis. I think that both things can happen but I that sometimes that discovering stuff with a math model can be more interesting than clarifying one's thinking. Having said that, the math work I'm doing now fits into the latter approach (clarifying).. Eric .
RE: Re: Rigor mortis?
Eric writes: >This does not mean that math models are not helpful when we consider the "real world." They can point out possible mechanisms and connections that are unlikely to be "discovered" in other forms of discourse.< I think it's important to remember that the phrase "the real world" is redundant. Also, isn't it more accurate to say tht math models can clarify one's thinking about "possible mechanisms and connections" instead of allowing them to be discovered? The discovery seems to be a pre-mathematical stage of the analysis. Jim Devine [EMAIL PROTECTED] & http://bellarmine.lmu.edu/~jdevine
Re: RE: Re: Suppression of Marx
> >Anyway, it was Justin who said that Roemer "probably caused more people to >take a look at Marx" or something like that. I don't know if that >encouraged >people to read Marx with intelligence. Wasn't me, but I think it's true. As far as his effect on economists, I can't say. He made _me_ read Marx a lot more closely, for sure, found I agreed with Marx more than him. jks _ Send and receive Hotmail on your mobile device: http://mobile.msn.com
Mandarinism, was Re: Rigor mortis?
"Devine, James" wrote: > > > this fits with my sense that economists embrace math so fervently partly > because it provides a basis for Mandarinism. (Mandarinism refers to the > pre-20th century practice of requiring would-be Chinese state bureaucrats to > take examinations in stuff like calligraphy that had nothing at all to do > with their ability to rule.) In an article he wrote many years ago Andre Gorz reports visiting one of the more exclusive technological academies in France. He asked someone, what do you teach here that couldn't be learned on the job in the factory. The reply, calculus. Next question, will they need calculus to do the work? No. So this practice can not only be used to filter out a ruling elite (China) or an elite band of lackeys (economics) but to create pseudo-elites within the working class. And since the economists can be divided into (a) those at the elite universities, thinktanks, corp staffs, etc) and (b) those at all the non-elite schools, we find that economist training both recruits elite lackeys and divides the working class. Carrol
Re: Rigor mortis?
Jim wrote, > More generally, math by its very nature describes an idealized world. That > doesn't mean that it shouldn't be used as much as that it has to be used > _very carefully_ if one's goal is to understand the world. I, who has used math in a previous life and am now learning game theory, see math as discovering the implications of various logical assumptions. The relation of these assumptions (and their implications) with the "real world" is somewhat in doubt. This does not mean that math models are not helpful when we consider the "real world." They can point out possible mechanisms and connections that are unlikely to be "discovered" in other forms of discourse. Eric
Re: Re: RE: Suppression of Marx
>Was Sraffa a Sraffian/neo-Ricardian; did he ever go beyond critiquing >neo-classical garbage? > No we wasn't one, and no he didn't. Personally, I have some reason to think he was a Stalinist. When I was at Cambs I was friends with a grad student of his who said that in his rooms he had Stalin's collected works totally read to shreds, marked up on every page and line, annotated slips of paper stuck in every other page. When he died, my college, Kings, which has these wonderful irreverent obits for every member or graduate of the college (it's good to know that someday I may have one, though of course i won't be hear to read it), had a long one on Sraffa. This was shortly after the Blunt affair, and the writer recalled a discussion with S at the time when thepresswas talking about The Fourth Man but before Blunt had been publically blown. Sraffa was asked, "Were you the Fourth Man?" He made an"indescribable Italianate wave of his hands,: and replied, "I forget which number I was." S was a friend of Gramsci's and Wittgenstein's, W acknowledges him in thepreface to the Investigations. I heard him lecture, he was astounding, talked the opposite of his laconic writing; he was effusive and charming, very Italian, only the density and brilliancy of his speech was like his writing. jks _ MSN Photos is the easiest way to share and print your photos: http://photos.msn.com/support/worldwide.aspx
RE: Re: RE: Re: Rigor mortis?
-Original Message- From: Michael Perelman [mailto:[EMAIL PROTECTED]] Sent: 04 March 2002 16:43 To: [EMAIL PROTECTED] Subject: [PEN-L:23467] Re: RE: Re: Rigor mortis? Daniel, I don't disagree with you, although the PBS television show, Nova, did do a pretty good job. I was asking about the examples of models that were able to teach something about the nature of the economy. Obviously, mathematics is important in finance, but I'm not sure how much it can teach about how financial machinations affect the economy. == here beginneth the apologia I tend to think that option theory actually has a much wider application than just in finance. For example (to plug the only piece I've ever published in anything even resembling an academic journal), you can model the payoffs to the owner of a limited liability company as the equivalent of the payoffs on a strip of put options. The idea is that, if the firm's assets are worth more than its liabilities on the next audit date, the owner gets a payoff equal to the positive difference between assets and liabilities (plus the ability to play the game for one more year), whereas if the assets are lower in value than the liabilities, the owner's losses are capped. For this reason, owners of limited liability firms have an incentive to maximise the volatility of their assets, and this incentive increases the futher "out of the money" the option moves. This explains the Nick Leeson "gambling for redemption" phenomenon. It's possible to put it in less mathematical terms, but I don't think you get the feel of it unless you know how to interpret vega (the sensitivity of the value of an option to a change in the volatility of the underlying). And that's not even touching the general issue of risk-neutral pricing, which I am currently constructively proving my point by not being able to give a sensible example of without using maths. Basically, this is an issue in the selection of the appropriate discount rate for a set of risky future payments under particular assumptions about one's ability to manage the risk. There are a knot of finance theory concepts here, but they're all terribly important: The CAPM tells me that if the risk of an investment I propose to make is like that of a lottery -- it's more or less a completely random number, like prospecting for opals in Australia --, then I ought to make an unbiased forecast of the future payoffs, and discount these back to the present at the *risk-free* rate. I use the risk free rate in this case because if I have enough of these projects, I can diversify this risk away and be more or less certain of getting the actuarial expectation. The CAPM also tells me that if my investment is correlated with the wider economy, and if the nature of the project is that I basically invest my capital now, and find out in the next time period whether I'm a winner or a loser (say, I'm thinking about distilling Scotch, and once I've put it in the barrels, there's nothing I can do except hope that people want to buy it in fifteen years), then I should adjust my discount rate upwards according to the *covariance* of the return on the project with my expected consumption. So if my Scotch is Johnnie Walker Black Label, then I should want a higher discount rate, because the event under which I get rich out of this business is one in which I'm rich anyway (a stock market boom in Japan), whereas if it's rotgut hooch, then I'd be prepared to accept a lower rate of return than Treasury bonds, because the rotgut hooch business would make me a big winner exactly in the sort of recessionary economy in which I'd need the money. I'll assume that this sort of intuitive explanation will do; in actual fact, to prove that covariance rather than variance is the relevant measure of risk, you need some pretty hairy maths. But risk-neutral pricing is something else. It says that if the nature of my business is one where I can make day-to-day changes to my output -- if I can *manage* the risk -- I ought to be setting out a plan to manage this risk, counting up the payoffs on various branches of the plan, and then discounting these cashflows at the *risk-free* rate of interest. The reason for this is (I contend) impossible to describe without getting into some sort of formalism, but it's got a lot to do with the fact that at any one stage in my plan, I can be hedged against the next small movement, so each node of my decision tree has me in a situation where (consistent with the plan) I have no risk, so the whole plan should be treated as a risk-free project. Which sounds awfully like a fallacy of composition, and you need the maths to prove that it isn't. Broadly speaking, finance (and its close cousin actuarial science) is the branch of economics which deals with uncertainty and time, so I don't see how it can fail to be relevant to the central questions of economics. Even something as simple as compound inte
RE: Re: RE: Suppression of Marx
The usual. The followers -- the Sraffians or neo-Ricardians -- weren't as good as their "Master" (Sraffa). As Joan Robinson made clear, the standard Sraffians "wage/profit frontier" model was only good for critiquing, since it described equilibrium states that couldn't persist. Jim Devine [EMAIL PROTECTED] & http://bellarmine.lmu.edu/~jdevine > -Original Message- > From: Michael Perelman [mailto:[EMAIL PROTECTED]] > Sent: Monday, March 04, 2002 8:22 AM > To: [EMAIL PROTECTED] > Subject: [PEN-L:23464] Re: RE: Suppression of Marx > > > Was Sraffa a Sraffian/neo-Ricardian; did he ever go beyond critiquing > neo-classical garbage?
RE: Re: Suppression of Marx
Michael Perelman > I don't agree with Romer [Roemer], but as Jim D.? observed, he probably caused > more people to take a look at Marx. If some of these people read Marx > with intelligence, so much the better. it's important to be careful with spelling here, since there are at least two economists named "Romer." Anyway, it was Justin who said that Roemer "probably caused more people to take a look at Marx" or something like that. I don't know if that encouraged people to read Marx with intelligence. Instead, I think that there was a lot of orthodox tut-tutting about "finally, here's a Marxist who speaks our language. It's about time some of them came around." Others decided that Roemer's method was a better way to understand the world than Marx's. Morishima's work had a similar effect. (Phil Mirowski has a great book review of Morishima in AGAINST MECHANISM.) Jim Devine
Roemer and Veneziani
Roemer and Veneziani by Devine, James 04 March 2002 00:08 UTC < < < -clip- The "workers don't save" assumption, by the way, is used by some extreme right-wingers to suggest that capitalists are rational and workers aren't so. The assumption should be dropped. Jim Devine ^^^ CB: This reminds of Marx's mocking discussion of the bourgeois mythology that the primitive accumulation of capital by the bourgeois was because they were superior savers and more frugal. ( Note Marx's summary statement about the role of FORCE as the key incredient in the primitive accumulation. "In actual history it is notorious that conquest, enslavement, robbery, murder, briefly force, play the great part.") http://www.marxists.org/archive/marx/works/1867-c1/ch26.htm This primitive accumulation plays in Political Economy about the same part as original sin in theology. Adam bit the apple, and thereupon sin fell on the human race. Its origin is supposed to be explained when it is told as an anecdote of the past. In times long gone-by there were two sorts of people; one, the diligent, intelligent, and, above all, frugal elite; the other, lazy rascals, spending their substance, and more, in riotous living. The legend of theological original sin tells us certainly how man came to be condemned to eat his bread in the sweat of his brow; but the history of economic original sin reveals to us that there are people to whom this is be no means essential. Never mind! Thus it came to pass that the former sort accumulated wealth, and the latter sort had at last nothing to sell except their own skins. And from this original sin dates the poverty of the great majority that, despite all its labor, has up to now nothing to sell but itself, and the wealth! of the few that increases constantly although they have long ceased to work. Such insipid childishness is every day preached to us in the defence of property. M. Thiers, e.g., had the assurance to repeat it with all the solemnity of a statesman to the French people, once so spirituel. But as soon as the question of property crops up, it becomes a sacred duty to proclaim the intellectual food of the infant as the one thing fit for all ages and for all tages of development. In actual history it is notorious that conquest, enslavement, robbery, murder, briefly force, play the great part. In the tender annals of Political Economy, the idyllic reigns from time immemorial. Right and "labor" were from all time the sole means of enrichment, the present year of course always excepted. As a matter of fact, the methods of primitive accumulation are anything but idyllic.
materialist theory of history
[was: RE: [PEN-L:23443] RE: Re: RE: Question to Various comments in In Dige
st 77]
Daniel Davies writes:
> ... if you're going to say that "productive" means "productive of things
which are desired by human beings at that particular point in history", then
I don't see how historical materialism can get off the ground. ie, if the
state of the production forces can only be given a meaning which is
dependent on the state of history, how can it be the basis of a theory of
history?<
I don't see why the "state of the productive forces" [or powers] has to be
measured in ahistorical or transhistorical ways. My understanding of Marx's
view of history was that each socioeconomic mode of production and
exploitation has its own unique dynamics. (See the "afterword to the 2nd
German edition of _Capital_, in which Marx endorses that "every historical
period has laws of its own.") That is, the structure of the mode generates
specific changes which end up creating conflicts that set the stage for the
abolition of that mode.
Thus, for capitalism, the system (based on the subjection of labor by
capital via the use of the reserve army of labor, mechanization, etc.)
generates dramatic capital accumulation and technological change ("growth of
the productive forces"). To Marx, this generated both crises due to the
falling rate of profit and also the growth of the proletariat with the
possibility of replacing capitalism.[*]
On the other hand, under European feudalism, the direct use of force in
production to push serfs to produce a surplus-product -- a result of the
serfs' direct control over the means of production and the process of
production and their ability to survive on self-produced goods -- actively
discourages the mechanization of production and other technological changes.
Instead of progress of "the forces of production," the main theme is the
squeezing of serfs and the development of military technology. This meant
that European feudalism couldn't feed the growing population, causing
demographic crises, undermining the system and setting the stage for the
rise of capitalism [cf. Brenner -- since Marx never studied feudalism
seriously]. As suggested by the theory of the demographic transition
developed by others-, capitalism doesn't really have demographic crises.
On the one hand, the "contradictions" are due to abundant growth of the
forces of production, while on the other, it's because they don't grow
enough. Marx's later theory of modes of production acknowledged the
difference, whereas his early "preface to the CRITIQUE OF POLITICAL ECONOMY"
theory wrongly generalized capitalism's dynamism to all of history.
>And whatever else one thinks about Cohen's work, I think he has to be right
that Marx had a theory of history, and that this theory of history was
materialsit and based on the productive forces.<
I don't think technological determinism is a good theory for understanding
history, since both the degree and quality of the forces of production are
endogenously determined by the social system, the mode of production and
exploitation. If Cohen is right that technological determinism is an
accurate representation of Marx's theory, then Marx was wrong.
[*] There are problems with Marx's story, but that's not the point of this
example. Rather, it's that different modes of production have different
dynamics.
Jim Devine
Re: Suppression of Marx
Please, to all concerned, try not to make this personal. Drewk wrote: > > In his latest attack on me, Justin Schwartz leaves out and does > not respond to the following (I wrote it in response to him > yesterday): I think that the use of the term, suppression, is a problem. I don't think much of Robert Lucas's economics. I say that I don't agree with him or that he is wrong. Is that suppression? I don't agree with Romer, but as Jim D.? observed, he probably caused more people to take a look at Marx. If some of these people read Marx with intelligence, so much the better. -- Michael Perelman Economics Department California State University [EMAIL PROTECTED] Chico, CA 95929 530-898-5321 fax 530-898-5901
Re: RE: Re: Rigor mortis?
Daniel, I don't disagree with you, although the PBS television show, Nova, did do a pretty good job. I was asking about the examples of models that were able to teach something about the nature of the economy. Obviously, mathematics is important in finance, but I'm not sure how much it can teach about how financial machinations affect the economy. "Davies, Daniel" wrote: > I've yet to see a decent explanation of risk-neutral pricing (most normally > seen in the context of the Black-Scholes and/or Cox/Ingersoll/Ross options > pricing models, but a very powerful economic idea of very general > application) which didn't involve some sort of formalism. I'm not saying it > can't be done, but I don't know how one would go about it. > -- Michael Perelman Economics Department California State University [EMAIL PROTECTED] Chico, CA 95929 530-898-5321 fax 530-898-5901
RE: Re: Rigor mortis?
Michael Perelman writes:>Marshall's biography -- he is also a villian in this piece -- shows that he pushed formalization of econ. to prevent "outsiders" from taking part in the subject.< this fits with my sense that economists embrace math so fervently partly because it provides a basis for Mandarinism. (Mandarinism refers to the pre-20th century practice of requiring would-be Chinese state bureaucrats to take examinations in stuff like calligraphy that had nothing at all to do with their ability to rule.) >I have little faith that formal models clarify much or avoid misrepresentations of reality. I have asked the list for examples of formal models that have taught them anything that they could not have learned by other means. I think Peter Dorman may have been the only one who responded.< I found that in order to talk about -- and to understand -- dynamic-disequilibrium growth theory (in my dissertation), math was totally necessary. In one model, the equilibrium is stable in the short run, but as the equilibrium persists, it becomes unstable. Nicholas Kaldor had a business cycle model along those lines. One of the big differences between my models and those of the orthodox school is that like Joan Robinson, I believe that we need to understand processes in historical time rather than in the totally hypothetical and unrealistic "logical time" of neoclassical economics. Jim Devine
Re: Re: Suppression of Marx
In a message dated 3/4/2002 7:17:33 AM Central Standard Time, [EMAIL PROTECTED] writes: MARX AND HIS POSTERITY Admittedly the founder of what has been the working-class movement shares some responsibility in the confusion of the thought that is meant to be Marxist or Marxism-related. But he did not deserve to get zealots completely lacking of critical judgment as heirs. Marx experienced as a genuine intellectual the throes of the contradiction that let its work unfinished fourteen years before his death. As soon as he came up against it, far from denying it as his epigones today do, and despite a lot of other sufferings, he looked for resolving it, while refusing to publish anything as long as it would not be overcome, going as far as hiding his manuscripts from his close relatives and friends. Engels's and Lafargue's accounts are in this respect quite definite. Only Rosa Luxemburg, another great intellectual, was not afraid of confronting this contradiction, while opening moreover a track to its solution. Then, Marxism was made up of two intellectual streams, each of them issuing from one term of the contradiction. One of them was based on the metaphysic of absolute "surplus value". The other one, without formally rejecting that metaphysic, took root in the scientific part of Marx's work, the "trending profit rate to fall", which the so-called absolute surplus-value plays no part in. The so-called "absolute surplus value", issuing mysteriously from the work of each wage-earning, suggests a mechanism of endogenous accumulation that a priori excludes any limit to the process. In other words, "capitalism" could be considered as being enabled to regenerate by itself indefinitely. What lead, within the surplus-value stream, to a break between a reformist secondary stream and a revolutionary one, the one concluding that socialism had to fit into the scheme of an almost eternal capitalism, the other that it had to put an end to capitalism, and that the only way of doing it was the subversion of the bourgeois political power. The first ones have kept, until today, the appellation of "social democrats", the second ones the appellation of "Marxists-Leninists". As for her, Rosa Luxemburg, although she hoped and prayed for the "proletarian revolution", had understood that the accumulation could not be endogenous and on the contrary needed an expansion within space, what was attested by colonialism. She logically concluded that this expansionism was necessarily to come up against a deadline, should it be in last resort the planetary one. In other words, "capitalism" was necessarily to one day enter a crisis of which it could not getting out. This thesis had to experience a censorship and a purgatory that are continuing. First, social democrats pilloried it after its printing. After what the Leninists took over them. Today again, the ones and the others maintain Rosa Luxemburg's main work (Die Akkumulation des Kapitals, 1913) under a burden of ignorance, of silence and of contempt. This attitude is quite coherent with the vocabulary that gathers now the enemy brothers: development, progress, democracy, fight against inequalities, citizenship. A vocabulary which is quite out of step with reality, but which can be understood as being an exorcism against the fear of future. And this infantilization of thought does not allow neither social democrats, nor residual Leninists to admit that history has agreed with Rosa Luxemburg, against them. Social democrats saw a stable world in which democracy and progress should settle all conflicts. As for him, Lenin saw a world forever divided by the conflicts of interests between the various empires, continuing at the planetary scale the class conflicts of within each of them, and that only the dictatorship of the proletariat was able to unite and pacify. For her part, Rosa Luxemburg saw an indistinct imperialism relentlessly continuing the colonizing process, out of necessity. A necessity from accumulation. Between this two conceptions, history has decided. The dictatorship of proletariat is a failure and a persistent after-tragedy, and the USA have put an end to the conflicts between imperialists, by exerting a leadership with which all of them have agreed totally (except general de Gaulle's interlude) and have even demanded. Finally, under IMF's management, the "globalization" is restoring the colonialist subjection and even extending it, as a trend, to all countries. But of the two original Marxist streams, it is the weakest, the most disconnected from reality, which today continues Marxism. Really, the author of Capital deserved another posterity. Romain Kroës Karl Marx "Preface to a Contribution to a Critique of Political Economy," states the following: "Then begins an epoch of social revolution. With the change of the economic foundation the entire immense superstructure is more or less rapidly transformed. In considering such transformations a distinction shoul
Re: RE: Suppression of Marx
Was Sraffa a Sraffian/neo-Ricardian; did he ever go beyond critiquing neo-classical garbage? On Mon, Mar 04, 2002 at 10:07:16AM -0600, Forstater, Mathew wrote: > There is a difference between making an unconvincing argument of logical > inconsistency and claiming a logical inconsistency without any attempt > to demonstrate it. (By the way, I never understood the Sraffian > argument against the LTV as in general based on logical inconsistency--I > thought it was that the LTV was redundant and therefore unnecessary--an > argument I do not buy, by the way.) mat > -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail [EMAIL PROTECTED]
Re: RE: Suppression of Marx
.> >There is a difference between making an unconvincing argument of logical >inconsistency and claiming a logical inconsistency without any attempt >to demonstrate it. (By the way, I never understood the Sraffian >argument against the LTV as in general based on logical inconsistency--I >thought it was that the LTV was redundant and therefore unnecessary--an >argument I do not buy, by the way.) mat > That's right about the Sraffan critique. It's unfortunate that Andrew feels obliged to regard my comment on his views as an attack on him. They are no so intended. They are a criticism of his views and his tone, but he's an intelligent and thoughtful economist--just a little bit thin-skinned. Not that I am always to equable all the time. (I once called Carrol a bucket of shit because I thought he'd accused me of being the internet equivalent of a police provacateur, not either of our finest moments, I think), but I apologized and we are friends now; Hell, even Charles knows that my criticism of his views, which are much harsher than mine of Andrew's, are not a personal attack, and I don't take Charles' robust ripostes personally either. We like each other, we just disagree sharply about a lot of things. jks _ Get your FREE download of MSN Explorer at http://explorer.msn.com/intl.asp.;
RE: Taliban and Aschcroft
At least it's not "let the eagle roll." But have people noticed the resemblance between Ashcroft and the late J. Edgar Hoover. Is it possible that Ashcroft's singing is a sublimation of his inability to look good in a little black dress? Jim Devine [EMAIL PROTECTED] & http://bellarmine.lmu.edu/~jdevine > The Taliban do not allow you to sing for your supper. > Ashcroft requires that > you do. > > Cheers, Ken Hanly
Powers of destruction
: SDTHE GI AS TERMINATOR From: [EMAIL PROTECTED] Subject: SDTHE GI AS TERMINATOR The following article appeared in the March 1, 2002, issue of the Mid-Hudson (NY) Activist Newsletter, published in New Paltz, NY. THE GI AS TERMINATOR The Pentagon is not content with simply possessing more destructive military machinery than all other nations combined. It wants to train and equip the individual GI to become a super-killer as well. According to a press release we received from the government's Oak Ridge (Tenn.) National Laboratory (ORNL) Feb. 21, "Arnold Schwarzenegger as The Terminator has nothing over the Objective Force Warrior envisioned by the Army and a team from the ORNL and organizations throughout the country." We contacted Oak Ridge to make sure the announcement wasn't a satire or hoax, and were assured by Ron Walli, the lab's public relations person, that it was genuine. The goal of the Objective Force Warrior project, we were informed, "is to develop a high-tech soldier with 20 times the capability of today's warrior and to have that soldier commissioned by about 2010. With advanced technologies, the army plans to create an overmatch and greatly minimize danger to its soldiers." George Fisher, the head of ORNL's National Security Directorate, says "the Army wants to stretch the bounds of technology but still have something that is feasible and can be built." Innovative technologies, he continued, "would allow a soldier to engage and destroy the enemy at longer ranges and greater precision and with devastating results. Technologies that would make that possible include better communications devices, advanced situational awareness software, chem-bio detection and protection, advanced weapons, and protective equipment." Walli's press release noted that "Fatigues and the flak jacket of the past ... would be replaced by a system designed to protect a soldier and provide hemorrhage control in case a bullet penetrates. The helmet of the future warrior might be a sealed unit that contains communications, vision enhancement, a laser for target ranging and a heads-up display." Fisher said the Army asked the lab to "coordinate a unique visioning process" for the Terminator GI because of its "unique capabilities and its connections to industry, institutions and technologies." Groups working with ORNL on the project include the Picatinny Arsenal, the U.S. Armor Center, Yale University, and the NASA Langley Research, among others. --
Veblenron
For those not on afeemail, this Veblen quote showed up there during a discussion of enron. From Veblen's 1904 book _The Theory Of Business Enterprise_ [Chapter 6]. "It follows, further, that under these circumstances the men who have the management of such an industrial enterprise, capitalized and quotable on the market, will be able to induce a discrepancy between the putative and the actual earning-capacity, by expedients well known and approved for the purpose. Partial information, as well as misinformation, sagaciously given out at a critical juncture, will go far toward producing a favorable temporary discrepancy of this kind, and so enabling the managers to buy or sell the securities of the concern with advantage to themselves."
Taliban and Aschcroft
The Taliban do not allow you to sing for your supper. Ashcroft requires that you do. Cheers, Ken Hanly Ashcroft's eagle soars, but some see a turkey By Julian Borger in Washington Since John Ashcroft became the United States Attorney-General last year, workers at the Department of Justice have become accustomed to his daily prayer meetings, but some are now drawing the line at having to sing patriotic songs penned by their idiosyncratic boss. Mr Ashcroft, a devout Christian and a grittily determined singer, went public with one of his works last month, when he surprised an audience at a North Carolina seminary with a rendition of Let the Eagle Soar, a tribute to America's virtues, which continues: "Like she's never soared before/From rocky coast to golden shore/Let the mighty eagle soar," and so on in a similar vein for four minutes. The performance, which can be seen and heard at www.cnn.com/video/us/2002/02/25/ashcroft.sings.wbtv.med.html, was accompanied only by taped music, but Mr Ashcroft's staff are complaining that printed versions of the song are being distributed at meetings so that they will be able to join in. When asked why she opposed the singalong, one department lawyer said: "Have you heard the song? It really sucks." A group of Hispanic employees at the Justice Department were recently summoned to see Mr Ashcroft, and went along hoping that their boss might be making a special effort to promote diversity in the department's higher ranks. Instead, they were asked to provide a hasty Spanish lesson to give him a few phrases to use on a foreign delegation the next day. The Hispanic staff were then handed printed copies of Let the Eagle Soar and asked for volunteers to translate it. This is not the first time Mr Ashcroft's subordinates have realised that he is unlike most politicians. Each time he has been sworn in to political office he is anointed with cooking oil (in the manner of King David, as he points out in his memoirs, Lessons from a Father to His Son). When Mr Ashcroft was in the Senate, the duty was performed by his father, a senior minister in a church specialising in speaking in tongues, the Pentecostal Assemblies of God. When he became Attorney-General, Clarence Thomas, a Supreme Court justice, did the honours. In January, a pair of 3.6-metre statues in the atrium of a Justice Department building were covered by a blue curtain, on orders from Mr Ashcroft's office because the female figure, Spirit of Justice, was bare-breasted, and the body of her male partner, Majesty of Law, was insufficiently covered by his toga. The cover-up has provoked an anti-Ashcroft campaign by the singer and film star Cher, who has denounced his puritanism. She asked one newspaper: "What are we going to do next? Put shorts on the statue of David, put an 1880s bathing suit on Venus Rising and a shirt on the Venus de Milo?" The Guardian
RE: Suppression of Marx
There is a difference between making an unconvincing argument of logical inconsistency and claiming a logical inconsistency without any attempt to demonstrate it. (By the way, I never understood the Sraffian argument against the LTV as in general based on logical inconsistency--I thought it was that the LTV was redundant and therefore unnecessary--an argument I do not buy, by the way.) mat
Re: RE: Re: Question to Various comments in In Digest 7 7
Both of you are right. Early Schumpeter believed in innovation by herioic individuals; later, Bell Labs. On Mon, Mar 04, 2002 at 07:03:25AM -, Davies, Daniel wrote: > > >But, in any case, I believe that attention in recent years by economic > >historians has been given to the role of countless thousands of very small > >innovations each year (rather than focus on the big-deal innovations) as > >having been key for technological progress in capitalism. I tend to go > along > >with this, in part because the big-deal innovations appear randomly and, if > > >Schumpeter is to be believed, due to the efforts of the heroic individual. > Not > >much consistent with Marx here. > > This may or may not be true, but I don't think it's what Scumpeter said; > IIRC, a "Schumpeterian" theory of innovation is one in which innovations are > institutionalised and brought about by the R&D departments of big > corporations. Bell Labs, not James Watt, are the classic Schumpterian > innovation story. > > dd > > > ___ > Email Disclaimer > > This communication is for the attention of the > named recipient only and should not be passed > on to any other person. Information relating to > any company or security, is for information > purposes only and should not be interpreted as > a solicitation or offer to buy or sell any security. > The information on which this communication is based > has been obtained from sources we believe to be reliable, > but we do not guarantee its accuracy or completeness. > All expressions of opinion are subject to change > without notice. All e-mail messages, and associated attachments, > are subject to interception and monitoring for lawful business purposes. > ___ > -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail [EMAIL PROTECTED]
Lax auto safety rules cost thousands of livesforcesofproduction/destruction
Lax auto safety rules cost thousands of lives forcesofproduction/destruction by Charles Brown 03 March 2002 23:23 UTC NHTSA forfeits oversight role http://www.detroitnews.com/specialreports/2002/nhtsa/ For example, in 1994, NHTSA dropped a case against GM pickups with fuel tanks that allegedly were prone to rupture. In return, GM spent $51 million on safety programs. Monday, March 4, 2002 NHTSA forfeits oversight role Lives lost because meek agency slow to spot defects Agency slow to add staff Major defect cases Reforms can take years to implement Even after research, new regulations can fail to improve safety Politicians undermine clout Automakers avoid recalls after top officials intervene Agency's work hindered by faulty data Flaws in statistical evidence cast doubt on scientific findings Report finds lax pursuit of defects Poor review prompts agency vow to better screen complaints NHTSA's revolving door Rollover complaints dismissed Emerging safety issue was ignored, critics say Agency's pace of change concerns lawmakers An "early warning" defect detection system mandated by 2000 law is not yet working Repairs favored over recalls Automakers offer service campaigns, no mention of defects Sunday, March 3, 2002 Lax auto safety rules cost thousands of lives / forces of production/destruction NHTSA fails to find defects or force recalls Vehicle safety standards outdated Industry viewpoint: Vehicles are safer than ever History: Agency created to end highway 'slaughter' http://www.detroitnews.com/specialreports/2002/nhtsa/index.htm ^^^ CB: All of a sudden the monopoly media exposes the above ?
RE: Re: Re: Rigor mortis?
Alan writes:>The problem I see with the (mainstream) economics profession---and I suspect that this is what many people on this list rightly object to---is the exaltation of mathematical formalism above all else. If formal models were taken as just _one more_ tool in the economists' toolkit then we probably wouldn't be having this discussion. < right. The problem is that economists use math as a way of proving and gaining status in the profession. If you don't do math, you don't rise to the top. Speaking of which, though I learned a bunch from the post-Keynesian economist Paul Davidson, I found that the few times he tried to use math were the most illuminating. This suggests that the problem isn't the math as much as the equilibrium conceptions that math encourages. More generally, math by its very nature describes an idealized world. That doesn't mean that it shouldn't be used as much as that it has to be used _very carefully_ if one's goal is to understand the world. But the vast majority of economists aren't careful. -- Jim Devine
Re: RE: Re: Dornbusch: Argentina must surrender soverei gnty on financial issues!!!!
At 3/4/2002, you wrote: >... >And as far as I can tell, Dornbusch's obsession with "having their money in >Miami" is patronising in the extreme, and seems almost calculated to give >the impression that all rich Latin Americans are coke smugglers. In fact, I >would guess that rich Argentines are old money and thus much more likely to >have their money in Switzerland. >... >dd Well, yes and no. I don't have exact numbers, but I would say that most of those who came into unbelivable rents thanks to privatized state enterprises and the Menem-era liberalization programs have their money mostly in Montevideo, New York and the Cayman Islands (or some other "paraíso fiscal"), besides Switzerland. Argentine economist Eduardo Basualdo, among many others (such as Manuel Pastor Jr.in the U.S.), has done some excellent work on capital flight. I will see if I can dig up any estimates of how it is distributed. Alan _ Do You Yahoo!? Get your free @yahoo.com address at http://mail.yahoo.com
Oz economy update
G'day all, Just keeping Doug, and anyone else interested in Australia's miracle economy, up to date on the way of things. The little Ozzie battler (the consoomer) is still throwing the Visa at anything shiny, and the quiet achievers (business) are investing in capital equipment again (it's either that or more storage space for their inventories, I s'pose). Anyway, let's hope the US don't cut Ozzie steel and agri-imports - let's hope the lapsed house-building grants don't dent demand, let's hope record residential debt doesn't slow those Visa cards, let's hope the CAD doesn't push the Aussie down and interest rates up, let's hope soaring insurance premiums don't close down small business, and let's hope the Yen doesn't fall and weaken demand from a trading partner with whom we do a quarter of our international business ... Cheers, Rob. Current account blows out, jobs ads dip CANBERRA, March 4 AAP|Published: THE AGE Monday March 4, 5:04 PM Australia's current account deficit more than doubled to its highest level in 18 months late last year while the jobs picture also weakened, new figures showed today. But there was better news on the retail front with shoppers lifting their spending for the eighth month in a row. Allowing for seasonal factors, retail trade rose 1.4 per cent in January to $14.09 billion, the Australian Bureau of Statistics said. Treasurer Peter Costello said the figures were very encouraging and showed solid retailing growth in Australia. But a collapse in exports late last year helped deliver the biggest current deficit in 18 months for the December quarter, the ABS said. The current account, a snapshot of all the financial transactions between Australia and the rest of the world for the quarter, blew out to $6.59 billion from $3.09 billion the previous quarter, itself a 20 year low. "The higher imports in the figure represent solid levels of consumption growth and a strengthening in business investment," Mr Costello told reporters. Labor's treasury spokesman Bob McMullan said the jump in the current account deficit, the biggest on record, raised concerns about the economy's direction in the second half of 2002. "With exports slowing and housing (expected) to slow, we desperately need those investment expectations to be realised or we're going to be relying entirely on strong consumption to drive growth in our economy," he said. Exports of goods and services outweighed imports in the September quarter, but there was a $2.52 billion turnaround in favour of imports in the December quarter, the ABS said. This would cut December quarter GDP figure - to be announced Wednesday - by 1.5 percentage points, it said. Net foreign debt dipped to $326.12 billion in the December quarter from $328.42 billion previously, the ABS said. Meanwhile, job advertisements in major newspapers fell by 5.4 per cent in February - the biggest fall in 11 months - to an average of 20,762 per week, the ANZ Bank said in its latest survey. But Mr Costello said there was still a net increase if the January survey was included. "Together with low home interest rates, the first home owners' scheme, strong retail trade - that presents a good picture for the economy in 2002," Mr Costello said. "Australia will, I believe, defy US recession, Japanese recession, south-east Asian countries in recession and continue to grow." ANZ chief economist Saul Eslake said the February fall was expected after January's strong gain, the fifth biggest in the survey's history. "Indeed, much the same can be expected to occur with the official employment figures for February, after January's extraordinary 101,800 gain," he said. By Jim Hanna, Economics Correspondent Copyright © 2002 John Fairfax Holdings Ltd. All rights reserved.
Re: Suppression of Marx
MARX AND HIS POSTERITY Admittedly the founder of what has been the working-class movement shares some responsibility in the confusion of the thought that is meant to be Marxist or Marxism-related. But he did not deserve to get zealots completely lacking of critical judgment as heirs. Marx experienced as a genuine intellectual the throes of the contradiction that let its work unfinished fourteen years before his death. As soon as he came up against it, far from denying it as his epigones today do, and despite a lot of other sufferings, he looked for resolving it, while refusing to publish anything as long as it would not be overcome, going as far as hiding his manuscripts from his close relatives and friends. Engels's and Lafargue's accounts are in this respect quite definite. Only Rosa Luxemburg, another great intellectual, was not afraid of confronting this contradiction, while opening moreover a track to its solution. Then, Marxism was made up of two intellectual streams, each of them issuing from one term of the contradiction. One of them was based on the metaphysic of absolute "surplus value". The other one, without formally rejecting that metaphysic, took root in the scientific part of Marx's work, the "trending profit rate to fall", which the so-called absolute surplus-value plays no part in. The so-called "absolute surplus value", issuing mysteriously from the work of each wage-earning, suggests a mechanism of endogenous accumulation that a priori excludes any limit to the process. In other words, "capitalism" could be considered as being enabled to regenerate by itself indefinitely. What lead, within the surplus-value stream, to a break between a reformist secondary stream and a revolutionary one, the one concluding that socialism had to fit into the scheme of an almost eternal capitalism, the other that it had to put an end to capitalism, and that the only way of doing it was the subversion of the bourgeois political power. The first ones have kept, until today, the appellation of "social democrats", the second ones the appellation of "Marxists-Leninists". As for her, Rosa Luxemburg, although she hoped and prayed for the "proletarian revolution", had understood that the accumulation could not be endogenous and on the contrary needed an expansion within space, what was attested by colonialism. She logically concluded that this expansionism was necessarily to come up against a deadline, should it be in last resort the planetary one. In other words, "capitalism" was necessarily to one day enter a crisis of which it could not getting out. This thesis had to experience a censorship and a purgatory that are continuing. First, social democrats pilloried it after its printing. After what the Leninists took over them. Today again, the ones and the others maintain Rosa Luxemburg's main work (Die Akkumulation des Kapitals, 1913) under a burden of ignorance, of silence and of contempt. This attitude is quite coherent with the vocabulary that gathers now the enemy brothers: development, progress, democracy, fight against inequalities, citizenship. A vocabulary which is quite out of step with reality, but which can be understood as being an exorcism against the fear of future. And this infantilization of thought does not allow neither social democrats, nor residual Leninists to admit that history has agreed with Rosa Luxemburg, against them. Social democrats saw a stable world in which democracy and progress should settle all conflicts. As for him, Lenin saw a world forever divided by the conflicts of interests between the various empires, continuing at the planetary scale the class conflicts of within each of them, and that only the dictatorship of the proletariat was able to unite and pacify. For her part, Rosa Luxemburg saw an indistinct imperialism relentlessly continuing the colonizing process, out of necessity. A necessity from accumulation. Between this two conceptions, history has decided. The dictatorship of proletariat is a failure and a persistent after-tragedy, and the USA have put an end to the conflicts between imperialists, by exerting a leadership with which all of them have agreed totally (except general de Gaulle's interlude) and have even demanded. Finally, under IMF's management, the "globalization" is restoring the colonialist subjection and even extending it, as a trend, to all countries. But of the two original Marxist streams, it is the weakest, the most disconnected from reality, which today continues Marxism. Really, the author of Capital deserved another posterity. Romain Kroës
Suppression of Marx
I hope soon to respond more fully to Mat Forstater, Jim Devine, and Justin Schwartz. Now there's no time. So for now, let me just try to refocus attention on the central reason why I say there's suppression of Marx by the Marxist and Sraffian economists. Everyone else in the discussion seems to be avoiding it, or maybe some people still haven't gotten it. So here goes. In his latest attack on me, Justin Schwartz leaves out and does not respond to the following (I wrote it in response to him yesterday): "I have nothing against alleging internal inconsistency WHEN it is true; WHEN one can prove it. But when one alleges it without proof, that is an ideological attack and effort to suppress. Certainly when the proofs of internal inconsistency have themselves been disproved -- as they have in the case of Marx -- and yet one continues to make them, or refrains from setting the record straight, it is quite clear that what is involved is an ideological attack on and effort to suppress the guy." The matter is straightforward. And no, Justin, it has *nothing* to do with whether one "agrees" or "disagrees" with the "criticisms" of Marx his critics make. School X alleges that some tenet of School Y is internally inconsistent, or invalid due to logical error. X alleges that the internal inconsistency, or logical error, has been proved. Thus far we have no reason to believe that these allegations constitute an ideological attack or effort to suppress. However, School Y now *disproves* the alleged proof of internal inconsistency or logical error. This doesn't mean that Y criticizes X's views. It means that Y demonstrates that X has not proved what it said it proved. At this point one might begin to suspect that X's allegations constitute an ideological attack and effort to suppress. But hey, X could have made an innocent error. Or there may be an error in Y's disproof. So at this point, I for one wouldn't suspect an ideological attack or effort to suppress. But now ... Y's disproof stands the test of time. School X does a lot of criticizing of Y's views, a lot of name-calling, etc., but it fails to overturn the disproof. And yet, School X does not concede that its claim to have proven internal inconsistency or logical error is false. It throws up all sort of smokescreens, like criticizing the views of School Y, name-calling, etc., in order to divert attention away from whether or not it claims to have PROVEN internal inconsistency or logical error are true or false. Some members of X continue to allege internal inconsistency or logical error -- now of course without any proof. Some still go around repeating the claims that internal inconsistency or logical error have been proved. Others are more tricky and cautious, but they too refrain from correcting the historical record, by retracting their false claims to have proven logical error or internal inconsistency. At *this* point, it is completely clear that X is engaged in an ideological attack on and suppression of Y. Right? Hic Rhodus! Hic Salta! J'accuse. Andrew Kliman
Re: Ripplewood Holdings (stems from Chi. Tribune on Enron)
Ripplewood Pt. 3 And as things become totally bizarre and muddled (mostly because Koizumi deregulation and liberalization are going to have immediate postive effects), we find Ripplewood/Shinsei and its good friends, Goldman Sachs, mixed up in it all. A lot of it, by the way, has to do with what is and what is not a 'bad' loan and what is and what is not an acceptable capital adequacy ratios. Do credit unions and savings and loans really have to operate at international standards? http://www.weeklypost.com/09/09a.htm The Weekly Post Special 1: Premier Koizumi Seems to be Failing in Reviving Japanese Economy Japan's Financial Services Agency (FSA) and the Bank of Japan (BOJ) appear to be concealing the fact that a major Japanese bank is in serious financial trouble. The bank is in an alarming situation. The FSA and BOJ do not have any concrete plan to deal with the possibility of a run on the bank by depositors. Even worse, the close cooperation that existed between the Prime Minister's Office, the FSA Minister and FSA executives in handling the nation's financial problems has started to disintegrate. The three coalition government parties who have been deciding Japan's financial policies are now fighting with one another. The major reason for this infighting stems from Prime Minister Koizumi's failure to set goals and policies for resuscitating Japan's ailing economy. Staff members from government bodies have been swayed by their own differences in opinions as well as by the suggestions of scholars. Another matter is a sex scandal involving a high-ranking FSA official, which seems to have been spread by the governing Liberal Democratic Party (LDP). The aim of the LDP's covert scandal plot seems to be to blame the mishandling of financial problems on the FSA Minister and then have him dismissed. The government and LDP are blaming each other for the grave economic problems facing Japan. This is not a proper response to the request for financial stability coming from the international financial community. 1. Scandal In the middle of November, bank stocks were sold off heavily and the prices of Asahi Bank and Daiwa Bank stock fell below the 100-yen benchmark. Japan's financial crisis worsened. Under such circumstances, a memorandum was issued by a central organ of the governing LDP. The memorandum leaked information on a paid date between a high-ranking official of the FSA and a woman of the Ministry of Finance. The affair allegedly took place when they were working for the Japanese government in the US. The memorandum says, "If they used the discretionary fund to pay for their trysts, it would be serious." The memorandum was aiming at eliminating the official in question. The FSA has conducting a special inspection of major banks in order to complete the bailout of non-performing loans that those banks held. A bailout involves a decision on what corporations should go bankrupt. The corporations in question are in the construction, real estate and retail industries. If one major corporation files for bankruptcy, all related companies must go bankrupt as well. If this happens, it will push up unemployment. The high-ranking official involved in the scandal (call him Mr. A for convenience) has been in a position to lead decisions on the issue. The Weekly Post has found an interesting fact about the scandal. In the second week of November, the FSA, which had been busy dealing with the sharp drop in banking stock prices and a special inspection of major banks, received three phone calls. The three calls were made by the Prime Minister's Office, LDP's Secretary General's Office and National LDP Headquarter Office. All three offices made the same inquiries about Mr. A's behavior while he was working in the US." The memorandum was found to reflect such movements by the Prime Minister's and LDP offices. 2. Push to Make FSA Director Resign Within the FSA, a conflict between Hakuo Yanagisawa, the Minister of Financial Affairs, and Akiharu Mori, the FSA Director General is surfacing. Before the conflict, Mr. Yanagisawa and Mr. Mori had once been allied in a fierce fight against the policies of Heizo Takenaka, the Minister of Economic and Financial Policy. Mr. Takenaka's plan was to accelerate the bailout of a huge amount of bad loans held by major banks. They claimed, "Given the severe recession in Japan, if we force the bailout of bad loans, the economy will fall into a panic." Prime Minister Koizumi had not been able to make any decision on the issue. His indecisiveness made Japan's financial problems worse. Pushed by aggressive movements by foreign hedge funds, he had to instruct the FSA to conduct a special inspection of the major banks. This meant the defeat of the alliance between Mr. Yanagisawa and Mr. Mori. That triggered the LDP to move toward removing Mr. Mori from the position of FSA Director General. Then, it related to the scandal memorandum. One source of the Prime
Re: Ripplewood Holdings (stems from Chi. Tribune on Enron)
Ripplewood Pt. 2 I would say that the difference this time is that most Japanese investments in the US turned out very bad for them, while the private equity groups like Carlyle and Ripplewood know how to make a buck. It's the same way GE Capital makes money too. They aren't in Japan to re-tool the automobile industry. The idea is buy up and keep what makes a lot of money and sell off the rest in packages at prices far more than what the stuff cost during the bankruptcy firesale. http://www.nightlybusiness.org/trnscrpt/2001/trnscrpt122601.htm#STORY3 12/26/01: Why US Businesses Are Bargain Hunting In Japan SUSIE GHARIB: During the S&L crisis in the US, investors all around the world bought up American assets, paving the way for an eventual improvement in the market. Now, history seems to be repeating itself in Japan. As Lucy Craft explains in the first of a two-part series, Americans could now be the catalyst for a turnaround in Japan's economy. LUCY CRAFT, NIGHTLY BUSINESS REPORT CORRESPONDENT: Forty-five-year-old buyout specialist Timothy Collins professes an aversion to the limelight, preferring a discreet low profile for himself and his New York-based private equity firm. But in Japan, his Ripplewood Holdings is anything but obscure. Collins is the most aggressive of a handful of foreign investors who are acquiring bankrupt Japanese companies at fire-sale prices. ROBERT FELDMAN, ECONOMIST, MORGAN STANLEY: I think a lot of foreigners will be coming here looking for good deals. Whether it turns into a flood depends in part on the ability of the Japanese to stand up to the plate and say, "no, I want it first," which many of them may want to do. But I do expect foreigners to come in and have a very active and constructive role in getting the Japanese economy back on track. CRAFT: Ripplewood signed its first deal here in 1999, picking up this prestigious but failed former industrial bank; a car parts company [Jannuzi's note here: this helped Nissan report profits since they paid a huge chunk of cash for a car parts division of Nissan that Ghosn and Renault figured they no longer needed] , resort, and Japan's oldest recording company were added to Ripplewood's portfolio this year. With a war chest of over $1 billion, Collins is still shopping for bargains in the chemicals, hotels, and electronics fields. Other potential investors look at Japan and they say, "this is a basket case." You look at it, when you're looking at the distressed assets here what do you see? TIMOTHY COLLINS, FOUNDER & CEO, RIPPLEWOOD HOLDINGS: Well, we don't really look at distressed assets. We look industry by industry, and what we see is a country that's got the most powerful industrial infrastructure in the world. It's got fabulous engineers, great technology, and a hangover from a disastrous bubble in the financial system, frankly not unlike - although elongated and exacerbated by the long length of time - not unlike some of the problems that the US is facing today. So when we look at investments, we fundamentally first on the industry and second on the competitive position of the underlying enterprises. And what happens on a macroeconomic basis is often a lot less relevant. CRAFT: But while fans call Ripplewood visionary, detractors call the firm a vulture. Hostile popular reaction to Ripplewood's headline-generating acquisitions has been reminiscent of anti-Japanese hysteria in the US, when Japanese snapped up Rockefeller Center and other trophy properties in the 1980s. EDWIN MERNER, PRESIDENT, ATLANTIS INVESTMENT RESEARCH CORPORATION: People are worried that they're asset strippers. So more or less they're going to come in, they're going to then sell off the pieces at a higher price than the parts are worth as a group, and then they're just going to pack their bags, put their money in their bags, and leave. I think that's the fear, that they're not really serious long- term players; they're just guys who want to make quick buck and be on their way. CRAFT: Collins, who has specialized in turnarounds for over 10 years in the US, calls such charges unfounded. And admirers say his strategy of scouring Japan for gems in the rough, competitive but debt- saddled companies, is sound. FELDMAN: I think he's perfectly right about that. I did a calculation once based on a sample of about 2,500 companies. A quarter of the companies, interestingly enough, have poor return on assets but also very low leverage. And that's a group of companies, a quarter of this entire sample, where if you can just get some management focused on raising the return on assets, then they could bloom into very, very good companies. So I think Tim is entirely right about that. Lucy Craft, "NIGHTLY BUSINESS REPORT," Tokyo. Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. Updates may be posted at a later date. The views of our guests
Re: Ripplewood Holdings (stems from Chi. Tribune on Enron)
What does Ripplewood know about running a credit bank in Japan? Pt. 1 The Ripplewood plan is simple actually: use high equity valuations and inflated asset prices in the US and an ability to operate as largely unregulated capital worldwide to buy up and profit from distressed Asia (Asia post 1997). The real beauty in the strategy is this: quite literally by becoming a holding company for banks in Asia, Ripplewood can use Asian savings (bank liabilities) to buy up Asia's own assets (loans, distressed assets such as failed companies that are not very leveraged but can't make loan payments , real estate, etc). Carlyle Group has made a similar move into Korea, and the others giants of privately held capital are circling the drain. Softbank got involved in a similar set up with the failed Japan Credit Bank, but it looks now more and more like the JCB will end up in the hands of a French capital group because Softbank, always dependent on high stock valuations, has none. This is a new twist on disintermediation: take over an Asian bank in order to invest Asian depositor's money in distressed Asian assets and keep all the profits. Quite literally, trust banks have become investment banks for privately held capital. The problem is the nature of the bank Ripplewood acquired. First, it had big connections with the Japanese economy and MofF. Second, what Ripplewood did was supposed to be a 'showpiece' for financial reform and liberalization. But third, they took over a credit bank, a bank that is given tax breaks but a special mission--that mission is to make more loans to small and medium sized businesses than even credit unions or savings and loans would think of. It's a huge nationwide entity with a huge amount of deposits. Therefore, considering what Shinsei Bank (was Long Term Credit Bank) is supposed to be doing and what it is actually doing, and considering the huge amounts of breaks that Ripplewood got in launching Shinsei, people are angry with how it's actually turned out. US advice to the Ripplewood people is for them to get better at lying about what they are actually doing. Here is the background, starting from 1999. http://www.weeklypost.com/990927/990927c.htm#popular LTCB Acquired by US Investment House Japan Long-Term Credit Bank (LTCB) has been under the management of the Japanese government since it has created about $26 billion debt [Note from Jannuzi: this is tiny actually compared to its deposits] in last October. Now, it was decided that LTCB was going to be acquired by Ripplewood Holdings, the US investment house. The acquisition will have a major effect on LTCB's major clients such as Daiei, a supermarket giant, Sezon Group, Sogo Department Store, Kumagai Construction Co. and Hazama Construction Co [Note from Jannuzi: this list is a bankruptcy hall of shame now]. These Japanese companies have huge loans from LTCB. Financial specialists are now predicting that Ripplewood request for repayment of these loans and these Japanese companies will have to go to bankrupt. More than 200,000 employees will be involved in their bankrupt and layoffs will cause panic in Japan [Jannuzi: and delight for vulture capital]. Posted by Charles Jannuzi
Free trade and auto industry
> > How the hell can W. pretend to be in favor of the wonders of > free trade > > and want to put the imports on steel, just to get Ohio, PA and > WV votes? >Because it's about --and has been since at least as far back as Bush >I--managed trade, not free trade and not fair trade. That is, managed trade >to benefit the vested interests able to buy access to the two political >parties. >If you have lived in Japan as I have and have followed US-Japan trade >relations over the past 12 years, you would have no illusions about what '>globalization' actually means to the US of Carlyle Group. >Next, do you think that the US gov't is going to embrace free trade and let >Toyota, Honda, and Nissan wipe out Ford and GM? Sure, credit deals are >pumping up the GM bottom line, but let's face it, if given a free trade >choice most Americans would choose Japanese cars. This has been true since >the quota era of the 1980s (in which there were quotas on Japanese cars and >Japanese memory chips, and a constant barrage of 'dumping charges' against >everything else). >If the US loses another WTO case, so what? It can just say liberalization of '>networked, integrated' services (telecommunications, financials, and I >guess Enron-markets) is the priority here. >Charles Jannuzi Would most people in America choose a vehicle made in Japan or by Japanese producers? I believe so because vehicles produced in America by American based producer are inferior from every point of view. The Toyota production or operating system remains the general benchmark in the industry. We chased this system of production for twenty years, to no avail. By the word "we" is meant the workers and management in the Chrysler Group and most certainly the union leadership at the highest level. Here is the intersection of interest and conflict. On a level playing field - meaning excluding monetary policy, the Japanese producers are a generation ahead of the US based manufacture and in all probability will never be caught. The reason for this is superior products, which expresses a different conception of totality in the production process. Not simply that US automakers are more profit driven, short sighted and have what manifest itself as a hatred for the workforce, but a fundamentally different conception of totality. You can open the door of a Toyota and shut it and literally hear and feel the difference. The attention to detail and precision is outstanding and the seasoned workers in the industry have nothing but admiration for the excellence of these products. Yet, the worker in the states demand for continued employment is inherently tied to his employer's survival in the market. Hence, the demand protection against workers producing a superior product that consumers want to purchase. Such is the logic of the economic basis of the trade union movement, from which there is no escape. Workers lobbying Congress for protection is not "false consciousness" but a fundamental boundary of this particular segment of the trade union movement. The living connection of worker and capitalist congealed in the social product is a boundary misunderstood - in my opinion, by much of the movement associated with the name of Marx and socialism in general. The "industrial proletariat" is tied to the "industrial capitalist" and breaking the connection is impossible within the boundary of our current property relations. It has not been that long ago that the huckster Lee Iacocca waged the campaign to demonize Japan and convince our citizens that buying the best product undermined the US economy. "Behind The Wheel At Chrysler: The Iacocca Legacy" by Doron P. Levin is excellent in describing the inner life of the Chrysler Group and the organic interactive relationship of employed and employer. Perhaps ten years ago my older brother was sent to Japan as part of the union delegation to study their production system. Besides falling in love with the Japanese autoworkers he fell in love with the country and was invited into their homes and "back alleys" of life the rest of his delegation was excluded from. Contrary to his esteemed delegation, he preferred riding the subways and traveling the "back alleys" and after several days some of the children would wing on his massive arms - which he insisted upon, while on the subway. His anaylsis of the Toyota and Honda production system was radically different than the report of the management delegation and most of his union brothers, who insist that the Japanese workers are treated like a slave. He basically reported to Bob Eaton - at the time Chairman of the Corporation, that in the US we are treated like slaves and management lacks any conception of the totality of the production process and will never catch up to the superior quality of the Japanese producers. He began with the conception of the facility itself; the conception of machinery and defining precision; the conce
