Max Mastellone — MMT economists look at debt, deficit differently

OMG! Is MMT going viral?

Las Cruces Sun-News
MMT economists look at debt, deficit differently
Max Mastellone

J. D. Alt — A Comfortable Betrayal

It would be a shocking scandal if it came to light that the professions of medical science had, for decades, known about an easy to treat, underlying cause of cancer—but conspired to obfuscate and suppress the information to protect their participation in a medical industry raking in hundreds of billions a year to treat the disease. Professional standings, tenures, licenses would be in tatters. Lawsuits would abound. Outrage would march on every city hospital and medical college in the nation—would it not?

Such a betrayal is not humanly possible, right? Yet is it not the case that the professions of economics, journalism and politics are guilty of something very like this kind of betrayal?…

I would make the lede a story of betrayal by companies that knew that smoking caused cancer and denied and concealed it.

Isn't the noble lie of "experts about money creation a similar betrayal of public trust? Even Alan Greenspan admitted in congressional testimony that government is not limited in the amount of currency it can issue.

Ordinarily, this is suppressed however. Bernard Lietaer revealed it as a taboo.

Real Progressives
A Comfortable Betrayal

J. D. Alt

Crossposted at New Economic Perspectives

Brian Romanchuk — The Chimera Of Generational Fairness In Fiscal Policy

Although mainstream economics prides itself on being highly precise and mathematical, this is not apparent when looking at the discussion of fiscal policy. It is very easy to find appeals to intergenerational fairness when discussing fiscal policy. Such a term is essentially meaningless in technical terms; it is mainly used as a ploy to evoke images of doe-eyed grandchildren being robbed by nefarious politicians. This article explains why the concept is largely worthless as an analytical concept....

Bond Economics
The Chimera Of Generational Fairness In Fiscal Policy
Brian Romanchuk

Bill Mitchell — The New Keynesian fiscal rules that mislead British Labour – Part 1, 2 & 3

The British Labour Party is currently leading the Tories in the latest YouGov opinion polls (February 19-20, Tories 40 per cent (and declining), Labour 42 per cent (and rising). They should be further in front, given the disarray of the Conservatives as they try to negotiate within their own party something remotely acceptable about Brexit. When there is this degree of political capital available, in this case for the Labour Party, a party should use it to redefine policy agendas that have gone awry. To build a narrative that will advance their cause for the future decades. British Labour has a chance to break out of its recent Blairite neoliberal past and present a truly progressive manifesto to the British people that will force the Tories to move closer to the centre and squeeze the extreme right-wing elements. In part, under Jeremy Corbyn and John McDonnell, Labour is making progressive noises on a number of fronts. But ultimately, where it really matters – the macroeconomic narrative – they are remaining firmly neoliberal and this will blight their chances of pursuing a truly progressive agenda. One of the glaring mistakes the Labour Party has made is to accept advice from neoliberal economists (so-called New Keynesians) who have instilled in them a need for fiscal rules. This is a three-part analysis of the sort of advice that Jeremy Corbyn and John McDonnell are getting and why they should ignore it....

Bill Mitchell – billy blog
The New Keynesian fiscal rules that mislead British Labour – Part 1

The New Keynesian fiscal rules that mislead British Labour – Part 2

The New Keynesian fiscal rules that mislead British Labour – Part 3Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Tom Streithorst — The Radical Left-Wing Theory That the Government Has Unlimited Money

Everyone knows governments need to tax before they can spend. What Modern Monetary Theory presupposes is, maybe they don't.

Surprisingly decent article on MMT considering the dismissive headline. Covers most of the bases.

Vice
The Radical Left-Wing Theory That the Government Has Unlimited Money

Tom Streithorst
ht Ralph Musgrave

Columbus Underground — Opinion — Provide Jobs for All and End Poverty

Let’s go back to the future and create livable wage jobs again for every man or woman who needs one. There is a new economics (Modern Monetary Theory aka MMT) that has designed Job Guarantee (JG) proposals that are carefully crafted to complement the need for real, full employment when the private and public sector​s​ fail to meet the needs of our workforce.

MMT economists understand that our capitalist economy must be organized for the benefit of everyone (i.e., Main Street communities, not just Wall Street investors). Without good jobs, our communities will continue to face all the costly and humiliating symptoms of poverty: food insecurity, unaffordable housing, drug abuse, domestic violence, the school-to-prison pipeline, etc.

A Job Guarantee program is both practical and affordable. MMT economists would tap the nonprofit sector to fund jobs that are needed now to meet the needs of our communities. The upfront costs would be high (some estimates are around three quarters of a trillion dollars), but it would save money in the long run by reducing the “safety net” costs and increasing local tax revenues. The Federal Reserve spent far more dollars bailing out the big banks after the Great Recession of 2007-08.

These would not be make-work jobs: skilled and unskilled labor is needed right now to insulate homes, plant trees, expand after school programs, offer rides to senior citizens, clean up our neighborhoods, etc. Ask any nonprofit agency if they are ready to hire. When true full employment returns, the private sector will again attract workers from the JG programs, many with new skills and work experience. JG programs will shrink as the private sector expands. More tax returns will strengthen local government services.

MMT economists have operated in the shadows of the dominant Chicago school of economics and the neoliberal policies of government austerity and income inequality driven by economic globalization, which benefits multinational corporations at the expense of Main Street local economies. We are fortunate in central Ohio to have a major think tank for MMT economists at Denison University in Granville. Anyone interested in JG programs and macroeconomic policies may visit the Binzagr Institute for Sustainable Prosperity.

Columbus Underground
Opinion: Provide Jobs for All and End Poverty

Richard Eskow — Picture the United States Without Student Debt

A new report from Bard College’s Levy Economics Institute concludes that this bold idea – cancelling all outstanding student debt – would help the entire economy and create more than a million jobs.

To those who say we can’t afford to cancel this debt, the report poses a new and different question: Can we afford not to?

Cancel and Grow

Using widely-accepted economic tools, the report’s authors – Scott Fullwiler, Stephanie Kelton, Catherine Ruetschlin, and Marshall Steinbaum – found that cancelling all student debt this country would create between 1.2 and 1.5 million new jobs. It would also increase the nation’s GDP by $86 billion to $108 billion per year over the next ten years....

Common Dreams
Picture the United States Without Student Debt

Richard Eskow

US News & World Report Best States Rankings

Measuring outcomes for citizens using more than 75 metrics

Iowa #1! (I am in Iowa City right now.)

US News & World Report
Best States Rankings

Powell supports "recalibration" of the supplementary leverage ratio

Topic came up in yesterday's testimony by Powell... between his being chastised by dumb Democrat legislators that the US was leaving too much debt to the grandchildren...

The unqualified Journo doesn't describe the technical issue correctly here:

The supplemental leverage ratio, which measures capital as a percentage of assets, restricts the amount of loan-making banks can make without raising more capital.

Calculation of the ratio includes the non-risk assets as well as the risk assets ("loan-making") of a depository institution.

It would be better described:  "The supplemental leverage ratio, which measures capital as a percentage of assets, restricts the amount of loan-making banks can make AND reserve assets banks can posses... without raising more capital."

So any policy that would increase the amount of reserve assets would move the needle away from the regulatory ratio set point; and action would then be taken to adjust the other parameters (i.e. the risk asset values) to bring the ratio back towards set point.

(Again... checkmate...)

From the Fed's latest H.8 release they have currently set the system level of reserve assets at $2.4T (!!!!!!) so if the proposed reform eliminates these non-risk assets from inclusion in calculating the SLR, as banks seem to run at about a 0.10 LR, that mod would seem to provide the depository system with at least $240B of excess capital to do something with... i.e. dividends, buy-backs, increase of loans, or any combination...

Fed Chairman Powell said he supports "recalibration" of the supplementary leverage ratio https://t.co/z9tyHV2mS2

— WSJ Financial Reg (@WSJFinReg) February 27, 2018

Ellen Brown - Funding Infrastructure: Why China Is Running Circles Around America

China doesn't have a good public health care system although the Chinese government is looking into it. And most Chinese don't have a Western standard of living so labour is cheaper there and is this part of the reason for its success? Maybe, but it took centuries for us to go from as rural economy to a modern industrial one (but now being industrialised) whereas China is advancing in just decades. It seems their system is greatly outsmarting our one.

I wonder if  Egmont Kakarot-Handtke pure scientific economic system can compete with this, but he does say his system can work alongside social democratic systems where the government runs large parts of the economy. He says it down to each country to decide what the government wants to run. 

I remember reading an article in the guardian once written by a good a very economics correspondent who said our pensions industry was going about it all wrong. The pension fund managers were just investing in the housing market and in the boom years they made big bonuses but in the bust years they kept their money while everyone else lost out. The incentives were all wrong, he said, and government regulations were need to make the pension companies invest in new businesses and start ups. This would have created good paying jobs for young people while creating good yields for the pensions of older people. What a missed opportunity, but we decided that deregulation would provide the best pensions instead. Or was it that the ruling elite decided this, while their neoclassical economists came up with the maths required to make it look right. 

In our neoliberal-neoclassical capitalist system maximising profits is the most important thing and this gives the biggest bonuses to CEO's. So they have been borrowing money at very low interest rates to buy back their companies shares increasing their value which makes the company look more profitable than it really is to get the biggest bonuses. But investing in the company would been better for creating jobs and ensuring its survival in the future while creating better products for the customer. And the saddest part is that this investment would have yielded larger profits later on. But when you can earn a ton in just two or three years, get to own mansions with acres of grounds, a super yacht or two, and holiday homes all around the world, why should a CEO worry if his company goes out of business in a few years time? 

Predatory investors would buy into companies, like Salisbury's, and then try to convince the other shareholders to force the management to sell all their property and lease it back instead. This would have generated massive one off profits and the predatory investors could then walk away with millions while leaving the companies hugely in debt making less them competitive in the future. What type of capitalist system is that? It's not about hard work and investing, it's about stripping out all the hard work that capitalists have put in in the past. Today's capitalism seems to be working in reverse. 

Ellen Brown says that china's public banks are not too concerned if they ever get their money back; if they do, then great, but if they don't, it circulates in the economy creating jobs and prosperity instead. 

How can our capitalist system possibly compete with the Chines model?  They are leaving us in the stone age. KV

Ellen Brown

“One Belt, One Road,” China’s $1 trillion infrastructure initiative, is a massive undertaking of highways, pipelines, transmission lines, ports, power stations, fiber optics, and railroads connecting China to Central Asia, Europe and Africa. According to Dan Slane, a former advisor in President Trump’s transition team, “It is the largest infrastructure project initiated by one nation in the history of the world and is designed to enable China to become the dominant economic power in the world.” In a January 29^th article titled “Trump’s Plan a Recipe for Failure, Former Infrastructure Advisor Says,” he added, “If we don’t get our act together very soon, we should all be brushing up on our Mandarin.”

On Monday, February 12^th, President Trump’s own infrastructure initiative was finally unveiled. Perhaps to trump China’s $1 trillion mega-project, the Administration has now upped the ante from $1 trillion to $1.5 trillion, or at least so the initiative is billed. But as Donald Cohen observes in The American Prospect, it’s really only $200 billion, the sole sum that is to come from federal funding; and it’s not even that after factoring in the billions in tax cuts in infrastructure-related projects. The rest of the $1.5 trillion is to come from cities, states, and private investors; and since city and state coffers are depleted, that chiefly means private investors. The focus of the Administration’s plan is on public-private partnerships, which as Slane notes are not suitable for many of the most critical infrastructure projects, since they lack the sort of ongoing funding stream such as a toll or fee that would attract private investors. Public-private partnerships also drive up costs compared to financing with municipal bonds.

In any case, as Yves Smith observes, private equity firms are not much interested in public assets; and to the extent that they are, they are more interested in privatizing existing infrastructure than in funding the new development that is at the heart of the president’s plan. Moreover, local officials and local businessmen are now leery of privatization deals. They know the price of quick cash is to be bled dry with user charges and profit guarantees.

The White House says its initiative is not a take-it-or-leave-it proposal but is the start of a negotiation, and that the president is “open to new sources of funding.” But no one in Congress seems to have a viable proposal. Perhaps it is time to look more closely at how China does it . . . .

China’s Secret Funding Source: The Deep Pocket of Its State-owned Banks

Ellen Brown - Funding Infrastructure: Why China Is Running Circles Around America

Alan Y. Wang - No, Economics Is Not a Science

Can economics ever be a hard science, like physics, chemistry, or biology, or is it a soft science, like psychology or sociology as it is about human behaviour, desires, wants and wishes? Should economists just stick to just pure economics as a pure science without politics, or desires, wishes, and concentrate instead on the perfect economy? 

What would the perfect economy look like, would it provide welfare to the poor, and would it see this welfare as an investment into a country's future because human resources are the most productive? Can economist factor this investment into their equations?  What about a national health service which can help stop businessmen from going bust because of crippling health care cost so their their companies can stay in business helping the economy to thrive? Have economists developed equations for this? 

What about quality of life, like early retirement, or less time spent at work, which could make a person more productive and happy when at work? Where's the maths for this? Or what about having time to go back to college or university to learn a new skill or get a degree which could help people to start new businesses helping the economy? Is there any maths for any of this?

Or do we just have pure capitalism as science without emotion, where people are just workers in an highly productive system, like animals in a factory farm, where output is set for maximum profits? We know how to increase milk production by using the most cruelest methods, and how to produce the most chickens or eggs. But is there room in economics for a humane system of farming and can this be put into equations as well? 

Is it best just to have pure economics as a science producing maximum profits, a pure scientific capitalism, or can economists design systems that improve quality of life and happiness for the general public? If such a system is soft science, like psychology or sociology, does it matter?  KV

Alan Y Wang, an opinion. 

Economists have faced a deluge of negative press in the past few years, ranging from criticisms over the failure to forecast the financial crisis, to the more recent disbelief over the granting of the Nobel Prize in Economics to three economists, two of whom hold views that can be said to be polar opposites. Indeed, the reputation of mainstream economics—specifically macroeconomics—is arguably at its worst since the formation of the field in the 1930s, with the advent of the Great Depression. This state of affairs prompted Raj Chetty, a professor of economics at Harvard, to author a defense of the field in ‘The New York Times,’ titled “Yes, Economics Is a Science.”

It seems as though economics is fighting for its right to stay in the exclusive group of fields deemed worthy enough to be called “science,” where subjects such as physics, chemistry, and molecular biology reside comfortably. Some instead opt to call economics, along with psychology and sociology, a “social science”—a vague term, often blurred with humanities, which is neither here nor there. Nevertheless, the underlying implication behind this battle is that to be a “science” is to be credible.

I don’t agree.

First and foremost, I don’t agree at all that economics is a science. Let me preface this by saying that I am concentrating in economics, and have the utmost respect for the field. Let me also clarify that when I say “economics” throughout this article, I primarily mean macroeconomics—microeconomics is an entirely different beast. While the two are intrinsically related, the methods of experimentation are so drastically different that the two can hardly be subject to the same criticisms.

Merriam-Webster’s definition of science is “a study of the natural world based on facts learned through experiments and observation.” What physics and chemistry and molecular biology have in common is that the building blocks of what they observe and experiment with don’t change. Such is the natural world. But what is the building block of economics? People. Economics does not study any unit smaller than a collection of people. And human behavior can never be absolutely predicted or explained—not if we wish to believe in free will, at any rate.

In fact, in a strict sense, economics does not even follow the scientific method. Engrained in the scientific method is the process of testing hypotheses with repeatable, falsifiable, and parameter-controlled experiments. Unfortunately for the field of economics, there are certain non-trivial barriers to experimentally tanking the Czechoslovakian economy over and over while controlling for interest rate levels. Oftentimes, the best economists can do is sit back and pore through the data given to them—data that is muddled by changing cultural standards, changing technological innovations, and changing time periods, among other factors.

All of this is not to say that I disapprove of economics, or think it illegitimate in any way—quite the opposite, actually. I believe that economics is a crucial field that directly impacts most everyone on this planet, perhaps more so than any other subject. The discovery of the Higgs-Boson made headline news around the world and has been heralded as one of the greatest triumphs of mankind’s collective intellect in history, but the Higgs-Boson has very little bearing, if any, on the daily lives of people. On the on the other hand, ill-timed economic austerity measures in Britain caused a very real, and very noticeable effect nearly immediately, setting the backdrop for the 2011 London riots.

This direct influence economics has on the individual lives of people stems from the fact that economics is, at its heart, a very person-centered and normative field of study. It is unique in the sense that economics fuses quantitative data and modeling with qualitative judgments; unlike in physics or chemistry, economics appends an implied “therefore…” statement to its conclusions. Economists’ findings that expanded insurance coverage increased lifespans and reduced costs lent implicit support to the Affordable Care Act—a law that will affect tens of millions of Americans.

Economics is not a science in the way that physics or chemistry is a science. Yet, this is not something to be lamented. Economics is not, and will never be, at the stage where models can precisely predict the day on which a financial crisis will start before it happens, but this is not due to the lack of legitimacy of the field; instead, it is due to the inherently unpredictable sphere of study in which economics operates. People are not atoms—and this is exactly why economics is immediately relevant.

What this means is that all of us—and the press in particular—should cease treating economics as though it were a science. We need to understand that economics is attempting to neatly model a very messy world.Do not expect clean answers.

Alan Y. Wang ’16, a Crimson editorial writer, is an economics concentrator in Kirkland House.

http://www.thecrimson.com/article/2013/12/13/economics-science-wang/

Bloomberg: JPM profit could increase $7 billion in the coming years

I thought that rising rates were supposed to be bearish????

JPMorgan's profit could increase $7 billion in the coming years from rising U.S. interest rates and accelerating loan growth https://t.co/ALEGO6GU8j pic.twitter.com/yGzK1YhwG8

— Bloomberg Markets (@markets) February 27, 2018

JPM current market cap is $400B with a PE of 18. So an additional $7B of earnings at 18x would imply an additional $125B or perhaps well above a 25% increase in share price. Even just a 10x would imply close to 20% increase. Nothing sounding bearish here...

Cecil Bothwell - Billy Graham and the Gospel of Fear

Not only is America full of guns where teenagers going on a rampage shoot out in schools is commonplace, men of God, those that say they love Jesus, have preached death and destruction to millions of people around the world. Billy Graham encouraged Nixon to start a war with China - in which millions of people would have died, including Americans -  and to bomb the dykes in North Korea where a million people would have died in drowning and starvation. I guess Billy Graham got inspiration from the Old Testament. KV

It was the first time Graham encouraged a president to go to war, and with characteristic hyperbole: Korea has never topped the list of Christian-leaning nations. Subsequently, Graham gave his blessing to every conflict under every president from Truman to the second Bush, and most of the presidents, pleased to enjoy public assurance of God’s approval, made him welcome in the White House. Graham excoriated Truman for firing General Douglas MacArthur and supported the general’s plan to invade China. He went so far as to urge Nixon to bomb dikes in Vietnam—knowing that it would kill upward of a million civilians—and he claimed to have sat on the sofa next to G.H.W. Bush as the bombs began falling in the first Gulf War (though Bush’s diary version of the evening somehow excludes Graham, as does a White House video of Bush during the attack).

According to Bush’s account, in a phone call the preceding week, Graham quoted poetry that compared the President to a messiah destined to save the world, and in the next breath called Saddam the Antichrist. Bush wrote that Graham suggested it was his historical mission to destroy Saddam.

Through the years, Graham’s politics earned him some strange bedfellows. He praised Senator Joseph McCarthy and supported his assault on Constitutional rights, then scolded the Senate for censuring McCarthy for his excesses. He befriended oil men and arms manufacturers. He defended Nixon after Watergate, right up to the disgraced president’s resignation, and faced public scorn when tapes were aired that exposed the foul-mouthed President as a schemer and plotter. Nixon’s chief of staff, Bob Haldeman, reported on Graham’s denigration of Jews in his posthumously published diary—a claim Graham vehemently denied until released tapes undid him in 2002. Caught with his prejudicial pants down, Graham claimed ignorance of the hour-and-a-half long conversation in which he led the antisemite attack.

Counterpunch

Cecil Bothwell - Billy Graham and the Gospel of Fear

Jimmy Dore - Bulletproof Blankets For Kids! Capitalism’s Answer To Guns

The market is always ingenious; the answer to school gun shootings: bullet proof blankets for kids! And Trump wants to arm teachers with guns too so then they can go into lessons with guns looking menacing in their gun holsters, while kids would be carrying about with them all day bullet proof blankets, Now I don't know how heavy a bullet proof vest is, but I a hunch that bullet anything would weigh a ton. Gee, what a place, hey, and the rest of us around the world think sod living there!

Dick Welcome - SWEDEN’S SCHOOL CHOICE DISASTER

Dick Welcome says he's not anti-market, but if you want a government funded school voucher system with private schools competing with each other then you will need more bureaucracy to police the system. Schools trying to survive will simply cook the books to make their schools look better than they are. 

But in the book, The Private Abuse of the Public Interest: Market Myths and Policy Muddles LD Brown and Lawrence Jacobs showed that when governments and local councils privatised services the cost to the tax payer increased by two or three times because of the amount of bureaucracy needed to properly police the privatised companies.  

Dick Welcome - SWEDEN’S SCHOOL CHOICE DISASTER

Data suggests that public education is most effective when parents, teachers, students and school administrators collaborate to focus on the individual needs of a child. A one-size-fits-all model of educating and measuring student achievement works well for some children, but leaves others desperately seeking public education alternatives.

One alternative to the current system of public education fueling political debate is the expansion of school choice through school voucher programs. According to supporters, implementation of voucher programs would create a market driven system that improves educational standards benefiting all of America’s children.  The problem is, the school voucher system has been implemented in other parts of the world, and failed, even as it appeared to initially succeed.

In a 2014 Slate article Sweden’s School Choice Disaster, Ray Fisman explains the downside to the voucher program and the competitive spirit that sabotaged its success. It began when the Swedes put their voucher system in place based on the free market ideas of Milton Friedman who was an advocate of the individualist perspective regarding educational choices:

The hope was that schools would have clear financial incentives to provide a better education and could be more responsive to customer (i.e., parental) needs and wants when freed from the burden imposed by a centralized bureaucracy.

But ten years after implementation of the reforms, the Swedes noticed a significant drop in their global scholastic achievement rankings. [The rankings compare the educational achievements of 65 countries based on several exams administered to students by the Program for International Student Assessment (PISA).]

The Swedish PISA scores were so low that they prompted a review of the internal grading system of Swedish standardized tests. It was discovered that the competition for voucher dollars was so strong, it eventually forced corruption in the system as schools began to manipulate the test scores and grades of children to attract parents and teachers. With the responsibility of choice placed on parents with vouchers in hand, schools were motivated to create false data to create the appearance of high achievement. However, the independent PISA scores indicated that students were actually performing worse after the voucher system was implemented. 

The moral of the story? In a free market where competition to survive is the main driver, competitors will always find creative ways to come out on top. Because of a lack of internal oversight, the inherent greed born out of a system of competition caused even the worst schools to manipulate numbers in order to retain students.

What can the US learn from the Swedish experiment? If the voucher system is to be effective, then a series of checks and balances must be incorporated into the process so that the competition avoids the natural tendency toward corruption. Left to their own devices, US schools will eventually focus on surviving rather than teaching, just as they did in Sweden. The overall goal of a better education for all students will eventually be overshadowed by the will of schools to simply survive if rules, regulations and oversight are eliminated from the process in the name of deregulation and less government control.

Of course, adding more bureaucratic structure to the school voucher program is the antithesis to the philosophy driving the proposal in the first place. Still, there must be a balance between the free-market approach and the bureaucratic approach that truly allows children access to the best education possible.

Without the implementation of a balance between divergent philosophies of government, implementation of school voucher programs in the United States is bound to repeat the failures of other nations like Sweden.

Dyckman Quade Welcome is Operations Manager for the NYC Department of Education’s P311 Call Center, serving 1.1 million students throughout the five boroughs. He is currently pursuing a Master’s degree in Urban Studies at CUNY’s School of Professional Studies with a concentration in Public Administration.

Dick Welcome - SWEDEN’S SCHOOL CHOICE DISASTER

The Private Abuse of the Public Interest: Market Myths and Policy Muddles (Chicago Studies in American Politics) 

Despite George W. Bush's professed opposition to big government, federal spending has increased under his watch more quickly than it did during the Clinton administration, and demands on government have continued to grow. Why? Lawrence Brown and Lawrence Jacobs show that conservative efforts to expand markets and shrink government often have the ironic effect of expanding government's reach by creating problems that force legislators to enact new rules and regulations. Dismantling the flawed reasoning behind these attempts to cast markets and public power in opposing roles, The Private Abuse of the Public Interest urges citizens and policy makers to recognize that properly functioning markets presuppose the government's ability to create, sustain, and repair them over time.

The authors support their pragmatic approach with evidence drawn from in-depth analyses of education, transportation, and health care policies. In each policy area, initiatives such as school choice, deregulation of airlines and other carriers, and the promotion of managed care have introduced or enlarged the role of market forces with the aim of eliminating bureaucratic inefficiency. But in each case, the authors show, reality proved to be much more complex than market models predicted. This complexity has resulted in a political cycle-strikingly consistent across policy spheres-that culminates in public interventions to sustain markets while protecting citizens from their undesirable effects. Situating these case studies in the context of more than two hundred years of debate about the role of markets in society, Brown and Jacobs call for a renewed focus on public-private partnerships that recognize and respect each sector's vital-and fundamentally complementary-role.

The Private Abuse of the Public Interest: Market Myths and Policy Muddles (Chicago Studies in American Politics)

The climate cover up - big oil's campaign of deception | DW Documentary

It turns out that oil companies knew way back in the 1960's about climate change. They commissioned scientific research to see how bad it would be so they would know how strong to construct their oil rigs and pipelines. Their research showed that in Alaska the ice would start to melt so they knew that their oil rigs built for the current conditions would last well into the future, but in other parts of the world they built stronger pipelines and oil rigs to counter the storms and chaotic weather conditions that climate change would bring. They even saw the benefits of climate change melting the polar caps making it easier for them to get to the oil buried underneath them. Now lawyers have gained copies of this research and have started suing the oil companies for fraudulence. New York is at real risk of flooding and being submerged and it will cost $billions to protect the state. KV

For decades, oil companies have known that burning fossil fuels impacts the climate. Why have they been keeping this information hidden? Donald Trump has a different view on climate change to his predecessors in the White House. It’s good news for major oil companies such as Exxon and Shell, which for the last 60 years have been funding studies and campaigns to dismiss the threat to the environment. New documents confirm that these companies have known since 1957 that burning fossil fuels impacts on the climate. Big oil has been deceiving the public for the past 60 years. Confidential research conducted decades ago by the oil majors shows that global climate change caused by human behavior is reality. In addition, engineers working for Exxon and Shell have been using that knowledge for future planning. Rising sea levels and the increasing frequency and severity of storms prompted the firms to make their oil rigs taller and more stable. At the same time, pipelines in the Arctic have been given reinforced foundations due to permafrost thaw. Geophysician Edward Garvey worked for Exxon between 1978 and 1983. He regrets that action wasn’t taken 30 years ago to combat climate change. Instead the oil companies commissioned counter-studies to be used by lobby groups. According to Carroll Muffett from the Center for International Environmental Law in Washington, they consciously funded surveys with the aim of discrediting the results. He calls it "the greatest scandal in human history.” Two district attorneys and a range of county authorities in the US have now launched proceedings against Exxon and other oil companies. This documentary examines the campaign of deception, and follows up on evidence of similarly dubious studies being published in Germany too.

More 'Supply and Demand' nonsense

Don't tell me now all these morons are going to be going all around saying: "we're running out of Olympics!!!!"...

When the Olympics are over and you have to go home 😝 #PyeongChang2018 #Olympics pic.twitter.com/P53PQBJGw8

— Madison Chock (@chockolate02) February 25, 2018

These were good games... South Korea: NOT a shit hole .... although they do eat dogs there I guess can't have everything...

Steve Keen - Debunking Mainstream economics: equilibrium barter models for a far-from-equilibrium monetary economy

After all the heavy politics, I found this to be light entertainment. And Steve Keen is a real nice guy. KV 

Steve keen

I had prepared a set of slides on "Can we avoid another financial crisis?", but with an audience exclusively of economics students at Sheffield University today, and pressed for time, I "went rogue", and challenged the limited nature of the "education" they get in economics today.

Gee it felt good! I've endured seeing rubbish portrayed as reason in economics for 45 years now, and I've hardly been silent about it of course. But I really cut loose tonight.

46 years ago, I was doing what these students are doing today: challenging what they are being taught as not merely inadequate for actually understanding the economy, but dangerously misleading about how this complex, evolving system actually behaves. 

I know a lot more about all of those factors now than I did then, and economics has superficially changed a lot too since 1971, when I turned from being a Believer to being a critic. But beneath its modern veneer there is an even more extreme, Ptolemy-like vision of an inherently stable system, with "shocks" to explain its deviations from equilibrium, and "frictions" to explain their length, than I railed against at Sydney University five decades ago. It's deferents and epicycles by other names.

As a way to understand the economy, equilibrium methods are, as Keynes once said, "blither", both historically and technically. No-one in their right mind could imagine that the economy was in equilibrium--or merely displaced from it by an exogenous shock"--a decade ago. Yet economists continue to not merely defend, but champion, an equilibrium-focused methodology.

There is simply no excuse for that today. The century when using equilibrium-fixated methods to describe a dynamic, evolutionary system could be excused ended in the 1970s, when system dynamics and complex systems analysis were developed.

It's far past the time that economists should have adopted the modern methods that engineers, meteorologists and mathematicians have designed for handling complex, far-from-equilibrium systems. But they never will, if left to their own devices. They need the cattle prods of student discontent, and of public ridicule. I encouraged the students to keep giving their lecturers hell since, to take the gist of Keynes's frequently misquoted and misunderstood statement on "the long run":

"Economists set themselves too easy, too useless a task, if in tempestuous seasons they can only tell us, that when the storm is long past, the ocean is flat again."

Don't abuse mathematics by calling what mainstream economists do "mathematical" either! Their methods are superficially reminiscent of mathematics, but a better description is mythematics. The world deserves better.

Steve Keen - Debunking Mainstream economics: equilibrium barter models for a far-from-equilibrium monetary economy

Telesur - Most Russians Prefer Return of Soviet Union and Socialism: Poll

Despite Putin's popularity it seems most Russians would prefer to go back to communism. They worked six days a week but it was leisure. The goods they made, like their cars, were often shoddy, but so what, life was easy. KV

Over 50 percent of Russian citizens believe the collapse of the Soviet Union was bad and could have been avoided.

The majority of Russians polled in a 2016 study said they would prefer living under the old Soviet Union and would like to see the socialist system and the Soviet state restored.

A little more than half of respondents stated that the demise of the Soviet Union could have been prevented, while 33 percent said it was inevitable.According to the poll conducted by the Levada Center, over 50 percent of Russian citizens believe the collapse of the Soviet Union was bad and could have been avoided. Only 28 percent of the population surveyed felt positive about its collapse, while 16 percent were unable to answer such a complex question.

Fourteen percent of respondents see the restoration of the Soviet Union as quite realistic, while 44 percent consider it unfeasible. Thirty-one percent of people said they would not be happy with such a turn of events, however.

Telesur - Most Russians Prefer Return of Soviet Union and Socialism: Poll

Bitcoin Embassy Opens in the United States

Hmmm what will they think of next.... maybe they could send an Ambassador from their Embassy to California to help that state with its financing...

New Bitcoin Embassy Opens in the United States https://t.co/yZXlMFiiXu #Bitcoin pic.twitter.com/BYPcQvidlK

— Bitcoin News (@BTCTN) February 25, 2018

W: "How Billy Graham Changed My Life"

More trite and coerced human behavior modification:

How Billy Graham Changed My Life https://t.co/7p0LSpoUKt

— Tom Cotton (@TomCottonAR) February 24, 2018

Tyler Durden - Bank Run Feared After ECB Unexpectedly Pulls Plug On Latvia Largest Private Bank

The financial press said Latvia was said to be the poster child of neoliberalism. It massively deregulated, privatised, implemented austerity, lowered taxes on the rich and raised them on everyone else, crushed labour slashing wages,  and the economy seemed to boom as exports increased. But young graduates could not find jobs so they emigrated in droves, while Latvian gangsters came back seeing that the lack of deregulation meant they could get up to serious mischief.   

 Last week we reported that as part of a rapidly deteriorating banking crisis in Latvia, which culminated with the detention of central bank head Ilmars Rimsevics on suspicion of accepting a bribe of more than €100,000 (which prompted both the prime minister and president to demand his resignation, something he has so far refused to do), the European Central Bank froze all payments by Latvia's largest private bank, ABLV, following U.S. accusations the bank laundered billions in illicit funds, including for companies connected to North Korea’s banned ballistic-missile program.

Then overnight the Latvian banking crisis escalated when in a statement released early Saturday, the ECB said ABLV Bank’s liquidity had deteriorated significantly, making it unlikely to pay its debts and declaring it "failing or likely to fail." As a result, Latvia's third largest bank will be wound up under local laws after the European Central Bank

Following the ECB’s decision, which also included the bank’s subsidiary in Luxembourg, the WSJ reported that Europe’s banking resolution authority decided the banks didn’t represent a systemic risk for their countries or the region and should be wound up by local authorities rather than be “bailed in” under EU rules.

Tyler Durden - Bank Run Feared After ECB Unexpectedly Pulls Plug On Latvia Largest Private Bank

The Real News: Bill Black - Once a Poster Child for Austerity, Latvia Becomes a Hotbed of Corruption

Tyler Durden - "CalPERS Is Near Insolvency; It Needs A Bailout Soon" - Former Board Member Makes Stunning Admission

Problems with pensions. 

Two weeks ago, in the aftermath of the February 5 volocaust, we quoted David Hunt, CEO of $1.2 trillion asset manager PGIM, who said ignore the volatility spike, the real financial timebomb was and remains public pensions: "if you were going to look for what’s the possible real crack in the financial architecture for the next crisis, rather than looking in the rearview mirror, pension funds would be on our list." 

In a brief discussion wondering what municipalities and states will do when local tax revenues decline and unemployment worsens, Hunt said "we're worried about those pension obligations.”

He is hardly alone: having reported over and over and over (and over, and over) again that public pensions are in deep trouble, two days ago none other than Steve Westly, former California controller and Calpers board member - manager of the largest public pension fund in the US, made a stunning admission, confirming everything:

"The pension crisis is inching closer by the day. CalPERS just voted to increase the amount cities must pay to the agency. Cities point to possible insolvency if payments keep rising but CalPERS is near insolvency itself. It may be reform or bailout soon."

Zero Hedge

Tyler Durden - "CalPERS Is Near Insolvency; It Needs A Bailout Soon" - Former Board Member Makes Stunning Admission

Door #1 or Door #2?

Here's Door #1:

Here's Door #2:

I'll take Door #1 please...

DANIEL LARISON - Trump’s ‘Phase Two’ for North Korea Means War

Let's hope Trump gives up the bluff and starts negotiating. This war would be totally pointless and is completely avoidable, says Danial Larison. 

Trump made another not-so-veiled threat against North Korea yesterday:

Speaking at a news conference with Australian Prime Minister Malcolm Turnbull, Trump made apparent reference to military options his administration has repeatedly said remain on the table.

“If the sanctions don’t work, we’ll have to go phase two,” Trump said. “Phase two may be a very rough thing, may be very, very unfortunate for the world. But hopefully the sanctions will work.”

We have no reason to expect sanctions to “work,” because sanctions usually don’t work and because it is now extremely unlikely that North Korea will agree to denuclearization under any circumstances. Referring to a “phase two” that is “very rough” and “very unfortunate for the world” is an obvious threat to attack, and that is how it will be received. That will just convince the North Korean leadership that it must never give up its nuclear weapons and missiles, and it will encourage them to continue developing both as quickly as possible.

The Trump administration persists in using punitive measures and threats, but these are the very things that have consistently failed to change North Korean behavior for the better and have usually pushed them in the direction that Washington doesn’t want them to go. At the same, they rule out the one thing–real diplomatic engagement–that has produced significant positive results in the past. When the Bush administration blew up the Agreed Framework, they sabotaged the one thing that had been at least partly successful in getting North Korea to limit its nuclear program. Ever since then, North Korea’s nuclear weapons and missile programs have steadily advanced amid international condemnation, sanctions, and threats of attack. We already know that the “maximum pressure” campaign will fail because it is simply intensifying a punitive approach that has been repeatedly tried and found wanting.

When sanctions fail again (and we should take for granted that they will), the U.S. has to pursue diplomatic engagement seriously and it needs to change the goal of its policy. Denuclearization isn’t happening, and demanding it kills any chance of making progress in getting North Korea to agree to limits on its arsenal and its testing. Threatening to use force is folly, and actually using force in this case is insane. If the U.S. is to have any success in negotiating with North Korea, it needs to shelve all proposals for a military attack and it has to be willing to accept a compromise on this issue. Otherwise, the U.S. is headed down a very dangerous path to starting a war that isn’t necessary and could be easily avoided.

The American Conservative 

DANIEL LARISON - Trump’s ‘Phase Two’ for North Korea Means War

Bitcoin Economic Theory

Neil fyi'ed this thing from the coin people... we'll never make any sense of it...

The economic theory the Bitcoiners are relying upon: https://t.co/6a9uLYxrjU

— Neil Wilson (@neilwilson) February 24, 2018

RT - 'They prefer boys in Afghanistan': Dancing bachas recruited for sex (RT Documentary)

An absolutely riveting but disturbing documentary about child prostitution in Afghanistan. The English RT team go to Afghanistan and interview a pimp and his team and I couldn't believe how open and honest they were, but child prostitution with boys over the age of 12 years old is not illegal, or a blind eye is turned, in Afghanistan. Women are not allowed out, and if they do get out occasionally in the back streets, they are fully covered head to toe. Men are frustrated by this so they turn their attention to young boys who do stage dancing acts dressed up as women but afterwards there might be sex. It's very popular.

The afghans in the film are honest about drugs and alcohol, which surprised me. Another thing that surprised is that they had clubs where they smoked hashish and videos were shown of scantly dressed Western women which was legal.

Now only a handful of people are interviewed but they seem to express sympathy for the women and wanted to see them more out in the streets, but they said that their government forbids it.

You get to see how brutal Afghanistan life is and it is disturbing to think what people can sink to when left to go wild. KV

RT

In Afghanistan women are forbidden to dance in public. Local men suffer – they want entertainment and sex at any cost. RT talked to “bachas”, boys dressed as women who dance for older men at male-only parties, and “playboys”, the bosses who recruit them. A private party usually ends up with guests bidding for a night with the ‘bacha’ (a ‘boy’ in Farsi).

Aaron Mate - Can Trump's Neocons Exploit Russiagate? (2/2)

I'm sure Tom put out Part 1 on this (embedded). Here's Part 2. It's shocking, the Neocons are neo-fascists.

However much Russiagate may annoy Trump personally, administration officials like H.R. McMaster are seizing on it to advance a militarist agenda at home and abroad. Max Blumenthal and Aaron Mate discuss

Chris Hedges & Abby Martin (Feb 21, 2018) - Propaganda Buries Facts & Manipulates Emotions

I was wondering whether to put this out when I saw Tom's post, American Meddling in the Ukraine, so I thought that this fits in. The US has supported fascism all over the world, toppled democratic regimes, and has perpetuated the most extreme violence and brutality to keep their fascist regimes in place. It is now supporting Neo-Nazi fascists in the Ukraine. And yet it portrays itself as the bastion of freedom, liberty, and democracy, while it considers itself the World's policeman - the good guys.