Then read this: Laundry is a never-ending chore – Vox
It’s about the social, historical, and economic aspects of laundry. It will make you think of laundry in a whole new light.
P.S. It’s the pandemic. I hope you are giving the ironing a pause in this difficult and wrinkly time. 🙂
(Photo by Filip Mroz on Unsplash)
At least, according to this: 700 years of Western inequality, in one chart – Vox
The chart shows the percentage of wealth owned by the top 10% since 1300. There are only two times it takes a major drop: during the Black Death in the 14th century and during World War II in the 20th century.
If true, it means that wealth concentration will continue unless another major catastrophe occurs (pandemic? global warming?).
There is lots to debate in all this. The numbers themselves are debatable (i.e. just how accurate and representative are they?) As well, there is an argument to be made that it doesn’t matter how inequally distributed wealth is if generally life for the 90% is good. But the Vox piece argues that such inequality leads to political instability and other problem, and that a good life for the majority isn’t enough.
Read the piece and consider it for yourself.
In some ways, that question is ridiculous. Ramsey and his ideas are embedded in so many fields of thought, from mathematics to economics to philosophy. However, I had never heard of him before. Or I should say, I had heard of him, but I never thought of him the way I thought of Russell or Wittgenstein or other contemporaries he had.
That might change now. There are two good pieces I recently found, here on CBC Radio and here in The New Yorker. I really enjoyed both. If you do too, you can get a recent book on him called, Frank Ramsey: A Sheer Excess of Powers
by Cheryl Misak.
Here’s something to ponder on a Sunday:
The rich were meant to have the most leisure time. The working poor were meant to have the least. The opposite is happening.
That is extracted from this: The Free-Time Paradox in America – The Atlantic
It’s a fascinating study of work and leisure and why it is not what many expected.
Forget what Steven Mnuchin said about Greta Thunberg needing to study economics before offering climate change proposals. That was an asinine thing for him to say.. But read that article in the Washington Post for the ideas. They spoke to an economist about climate change and how economics comes in and it’s worthwhile for that.
People might argue that we need to do something about climate change, but we can’t afford it. If you want to argue back, the article can help.
Not yet, but clearly it is in trouble, based on this: Why Muji Is Struggling | News & Analysis | BoF.
My feeling is they have expanded past the point it is sustainable, and now they are going to have to adjust. Hopefully they can adjust: they are a good company and they could be as big as IKEA or H&M. Or they could go bankrupt. The next few years will show which direction they go.
Thanks to Jeff Smith for sending me this link!
We don’t talk much about poverty anymore. We talk about the middle class a lot. We don’t talk about the upper class or the rich anymore: instead we talk about them in terms of percentage points. And we don’t talk about the poor as much as we talk about those who are homeless. But there are still poor people in our society, and one member of that group wrote about it here: Falling.
He has a home, he was middleclass, and now he is poor. The story is sad but not exceptional.
I don’t know why we don’t talk about the poor so much any more. Perhaps we see poverty as shameful, not for the people who are poor, but shameful for people who don’t see themselves as poor. I don’t know. I think we do need to talk about it and the spectrum of financial status, and I think we need to work towards a fairer and more equitable society. First, we need to look and talk about it more clearly.
Is the one thing about the Obama legacy that can’t be repealed. Namely this:
There is no mystery about Barack Obama’s greatest presidential achievement: He stopped the Great Recession from becoming the second Great Depression.
Obama did many important things, Obamacare being the obvious. As someone who had seen many failed attempts at achieving this, to see him team with Pelosi and others to achieve this was astounding.
That said, there would have been nothing accomplished by Obama if the US spiralled into a second Great Depression, dragging down the world economy with it. I continue to see criticism of the actions taken by his team then, especially among progressives. They argue that more should have been done. You can google “Obama terrible” and find pieces like this.
Time will tell, but so far Obama is holding up as anything but terrible. I predict he will rise in Presidential standing in the future. Meanwhile, the world is in much better shape due to the actions he took in the early stages of his presidency to avert worldwide economic disaster.
I have thought about this piece on capital often since I read it: Continuations by Albert Wenger : Capital Is No Longer Scarce.
I realize it is relative and that there are people and organizations that have difficulty accessing capital. But I believe overall there is an abundance of capital. I believe that is why you see a lot of the behaviours you see in the world, from negative interest rates to bogus unicorns like We and Uber and Lyft to high housing valuations to no inflation.
German Lopez from Vox makes it, here: America needs more unions – Vox.
As for me, many unions fall under the idea of countervailing power, which I am a strong proponent for. The countervailing power aspect is important. The worst unions are not that.
If you read articles like this, Why Homes in Major U.S. Cities Are Nearly Impossible To Afford – Curbed, it can be hard to believe than any city not on the decline can be affordable. But there are exceptions, and it is good to know about them and why they are. One such city is Vienna, and this piece has a good explanation on why it is.
If you are concerned about cities being affordable, I recommend the piece on Vienna. Affordable cities is going to be one of the big challenges of the 21st century. We need good ideas to deal with this.
(Image via pexels.com)
It seems to me that the law of supply and demand stops working from time to time. But I think that is wrong, and pieces like this remind me that I am wrong: How Walmart has successfully recruited truck drivers amid a labor shortage crisis.
The reason I think it stops working is because I see wage growth stagnating in many places. But I also see productivity stagnating too, and I think there is a relationship between that. There is some elasticity there that allows wage growth to stagnate but in return productivity growth stagnates too.
In Walmart’s case, the elasticity is gone: if they can’t get truckers, they lose business. It’s simple. But for businesses without such hard and fast metrics, you might just continue to see slack productivity and slack wage growth.
I’ve read a number of articles talking about the demise of New York due to rising rents and gentrification. After reading them, tt’s easy to feel hopeless about New York and cities in general. Which is why I was glad to read this: New York City Reveals the Future of American Retail – The Atlantic. It’s true, there are big changes in New York, just like there are big changes in other cities. And it’s true that many beloved retail stores are disappearing in cities everywhere. But it’s untrue that vacancy rates are shooting up and it’s untrue that it’s only big chains taking over. While retail stores threatened by Amazon are closing, places like restaurants and fitness locations are filling the gap.
You can argue that a city needs more than this new world of cafes and restaurants and gyms. The article points out to ways cities can encourage that. Specifically:
According to Jeremiah Moss, specific policies caused the disappearance of old New York—like tax breaks for big businesses, which have been a hallmark of city governance since the Ed Koch days (and up through HQ2). Moss says that several new policies could fix the problem. First, he is an advocate of the Small Business Jobs Survival Act, which would make it easier for small retailers to extend their lease in neighborhoods with rising rents. Second, he favors zoning laws that would limit the density of chain stores. He and others have also called for “vacancy taxes” that punish landlords who sit on empty storefronts for months at a time. All of these policies could help small businesses push back against the blandification of New York and the broader country.
Cities thrive when there is a mix of establishments servicing the wants and needs of its occupants. After reading this article, I think cities, New York and elswhere, are doing well and have a viable path to get better.
That’s been a question I have been asking myself for some time. I felt like the price just keeps going up. And if you read articles like this, it’s easy to conclude it’s true.
But here’s some numbers on the least expensive models over time, taken from this:
iPhone (4GB): $499
iPhone 3G (8GB): $599
iPhone 3GS (16GB): $599
iPhone 4 (16GB): $599
iPhone 4S (16GB): $649
iPhone 5 (16GB): $649
iPhone 5s (16GB): $649
iPhone 6 (16GB): $649
iPhone 6 Plus (16GB): $749
iPhone 6s (16GB): $649
iPhone 6s Plus (16GB): $749
iPhone 7 (32GB): $649
iPhone 7 Plus (32GB): $769
iPhone 8 (64GB): $699
iPhone 8 Plus (64GB): $799
iPhone X (64GB): $999
Looking at that, I have to think that the phones are getting more expensive, but likely they have always been that way. (And note, this doesn’t account for inflation or the improved quality of the phones, including greater storage.)
Occasionally Apple will make a cheaper phone like the 5C or the SE that are essentially remixes of older models. Or they will continue to support a wider range of phones, like continuing to sell the 7, the 8, and now the X. But it seems the high end was never inexpensive and likely never will be.
Worth reading: Senior Citizens Are Replacing Teenagers as Fast-Food Workers – Bloomberg.
- the reasons to hire older workers for fast food places is also true for other work as well.
- the notion of retirement needs to be rethought. People are living lives well past traditional retirement ages, and some people retire involuntarily decades before they die. Additionally, many of them cannot afford to not work all that time. Having work and an income in their later years makes sense.
- Good work is uplifting. If you can find good work as you get older, you can find a way to make your later years more worthwhile.
This piece, Opinion | Still Haunted by Grocery Shopping in the 1980s – The New York Times, by a Brazilian economist highlights the emotional scars that economic hardship has on a person. Key quote for me was this:
Research has found that children living in poverty are at increased risk of difficulties with self-regulation and executive function, such as inattention, impulsivity, defiance and poor peer relationships. It takes generations until society fully heals from periods of deep instability. A study in the early 2010s showed that Germans were more worried about inflation than about developing a life-threatening disease such as cancer; hyperinflation in the country ended almost 100 years ago.
Not only does it touch people individually, but you could make the case that it gets embedded into the culture. Germans are still worrying about inflation! Indeed, I remember my mom telling me how the Great Depression affected her mother to the point that she adopted behaviors she could never shake, not matter how much she had in the future.
Economics can seem dry, especially when people focus on numbers. But those numbers paper over how people are really affected. What is the emotional impact of high (or low) unemployment? What do we see happening in the culture when housing becomes unaffordable or work impossible to get. The numbers are an essential part of the story but they are also just the start of the story.
Based on many affluent cities currently, the answer is “no”. But there are exceptions we can learn from like Vienna. As this piece shows, Vienna’s Affordable Housing Paradise | HuffPost, it’s possible even in affluent cities and countries to have affordable housing under the right conditions.
Well worth reading that if you are feeling it is impossible to have affordable housing these days.
Possibly, but as this article argues, there are at least three areas where robots and suck at:
Creative endeavours: These include creative writing, entrepreneurship, and scientific discovery. These can be highly paid and rewarding jobs. There is no better time to be an entrepreneur with an insight than today, because you can use technology to leverage your invention.
Social interactions: Robots do not have the kinds of emotional intelligence that humans have. Motivated people who are sensitive to the needs of others make great managers, leaders, salespeople, negotiators, caretakers, nurses, and teachers. Consider, for example, the idea of a robot giving a half-time pep talk to a high school football team. That would not be inspiring. Recent research makes clear that social skills are increasingly in demand.
Physical dexterity and mobility: If you have ever seen a robot try to pick up a pencil you see how clumsy and slow they are, compared to a human child. Humans have millennia of experience hiking mountains, swimming lakes, and dancing—practice that gives them extraordinary agility and physical dexterity.
Read the entire article; there’s much more in it than that. But if your job has some element of those three qualities, chances are robots won’t be replacing you soon.
Two links worth reading on Finland and UBI: this one and this one.
Essentially, Finland did a form of UBI and it didn’t work. Those for UBI will argue it was implemented poorly. Those against UBI will argue those people are purists and in fact UBI will never work.
I think there are limits to UBI, but the Finnish implementation was poor. I think it can be done better than that. Read the two pieces in the New York Times and decide for yourself.
This is the question reviewed here: Are plagues and wars the only ways to reduce inequality? | Aeon Essays. (It’s a long read but a good one.)
If you are not familiar with this idea, consider this graph:
The higher the red line is, the greater inequality is. Throughout the last 2000+ years, inequality has been reduced only by terrible events like plague and war.
For a time post World War II, inequality was declining in much of the world. Then, around the 1980s, it started to increase and continues to do so. Now we have a race on. Population declines should occur over the next 100 years, leading to greater equality. To counter that, we have greater automation occurring which may boost inequality as those with the means to control the automation make much of the income and increase their wealth. Will this inequality lead to events that once again levels off the distribution of wealth and income? Or will we reach a balance somehow?
I highly recommend the article. Rising inequality will be one of the great strains on the 21st century, and this article helps to provide some context on the subject.
The good news is this: There’s More Farmland in the World Than Was Previously Thought | Agweb.com.
There are still problems in preventing hunger and famine, but decreasing farmland should not be adding to that. Good! Now to decrease conflicts and ensure everyone has access to good, cheap, nutritious food.
(image via pexels.com)
Often times it is hard to appreciate the work of Nobel Prize winners, including those in Economics. Thaler is not one of those people. His work is very approachable for laypeople, and the benefits of his work is obvious.
Here’s one example, of how his work led to better results for people in terms of pensions.
Youtube is a great source of videos on Thaler. If you want to get started understanding what is behind his thinking, you can start there.
In addition, the New York Times covers his award winning here and it is another good introduction. Finally, here is a piece in the Times that Thaler wrote himself, on the power of Nudges. If you do anything, read that.
Good to see him win.
This piece: What it’s like to be a modern engraver, the most automated job in the United States — Quartz, reminded me once again that the best use of technology is to augment the people doing the work, and not simply take away the work. Must reading for anyone who’s believes that the best way to use AI and other advanced tech is to eliminate jobs. My believe is that the best way to use AI and other advanced tech is to make jobs better, both for the employee, the employer, and the customer. The businesses that will succeed will have that belief as well.
(Image from this piece on how humans and robots can work together.)
According to Haydn Waters, a writer at CBC, the mail robots at the corporation are being discontinued. Instead:
Mail will be delivered twice a week (Tuesday and Thursday) to central mail delivery/pickup locations on each floor.”
What gets lost in alot of discussions of robots, AI, etc., taking all the jobs is that the drivers for the decisions is not technology but economics. If there is no economical need for robots and other technology, then that technology will not just appear. There is nothing inevitable about technology, and any specific technology is temporary.
Of course there will be more use of robots and AI and other technology to replace the work people may currently do. The key to finding work will be to continually improvise and improve on the tasks one has to do to remain employed. That’s something humans do well, and technology will struggle with for some time in the future, AI hype not withstanding.
If you are looking to build AI tech, or just learn about it, then you will find these interesting:
- Artificial intelligence pioneer says we need to start over – Axios – if Hinton says it, it is worth taking note
- Robots Will Take Fast-Food Jobs, But Not Because of Minimum Wage Hikes | Inverse – true. Economists need to stop making such a strong link here.
- Artificial Intelligence 101: How to Get Started | HackerEarth Blog – a good 101 piece
- Deep Learning Machine Teaches Itself Chess in 72 Hours, Plays at International Master Level – MIT Technology Review – the ability of tech to learn is accelerating.
- Now AI Machines Are Learning to Understand Stories – MIT Technology Review – and not just accelerating, but getting deeper.
- Robots are coming for your job. That might not be bad news – good alternative insight from Laurie Penny.
- Pocket: Physicists Unleash AI to Devise Unthinkable Experiments – not surprisingly, a smart use of AI
- AI’s dueling definitions – O’Reilly Media – this highlights one of the problems with AI, and that it is it is a suitcase word (or term) and people fill it with what they want to fill it with
- A Neural Network Playground – a very nice tool to start working with AI
- Foxconn replaces ‘60,000 factory workers with robots’ – BBC News – there is no doubt in places like Foxconn, robots are taking jobs.
- 7 Steps to Mastering Machine Learning With Python – don’t be put off by this site’s design: there is good stuff here
- How Amazon Triggered a Robot Arms Race – Bloomberg – Amazon made a smart move with that acquisition and it is paying off
- When Police Use Robots to Kill People – Bloomberg this is a real moral quandary and I am certain the police aren’t the only people to be deciding on it. See also: A conversation on the ethics of Dallas police’s bomb robot – The Verge
- How to build and run your first deep learning network – O’Reilly Media – more good stuff on ML/DL/AI
- This expert thinks robots aren’t going to destroy many jobs. And that’s a problem. | The new new economy – another alternative take on robots and jobs
- Neural Evolution – Building a natural selection process with AI – more tutorials
- Uber Parking Lot Patrolled By Security Robot | Popular Science – not too long after this, one of these robots drowned in a pool in a mall. Technology: it’s not easy 🙂
- A Robot That Harms: When Machines Make Life Or Death Decisions : All Tech Considered : NPR – this is kinda dumb, but worth a quick read.
- Mathematics of Machine Learning | Mathematics | MIT OpenCourseWare – if you have the math skills, this looks promising
- Small Prolog | Managing organized complexity – I will always remain an AI/Prolog fan, so I am including this link.
- TensorKart: self-driving MarioKart with TensorFlow – a very cool application
- AI Software Learns to Make AI Software – MIT Technology Review – there is less here than it appears, but still worth reviewing
- How to Beat the Robots – The New York Times – meh. I think people need to learn to work with the technology, not try to defeat it. If you disagree, read this.
- People want to know: Why are there no good bots? – bot makers, take note.
- Noahpinion: Robuts takin’ jerbs
- globalinequality: Robotics or fascination with anthropomorphism – everyone is writing about robots and jobs, it seems.
- Valohai – more ML tools
- Seth’s Blog: 23 things artificially intelligent computers can do better/faster/cheaper than you can – like I said, everyone is writing about AI. Even Seth Godin.
- The Six Main Stories, As Identified by a Computer – The Atlantic – again, not a big deal, but interesting.
- A poet does TensorFlow – O’Reilly Media – artists will always experiment with new mediums
- How to train your own Object Detector with TensorFlow’s Object Detector API – more good tooling.
- Rise of the machines – the best – by far! – non-technical piece I have read about AI and robots.
- We Trained A Computer To Search For Hidden Spy Planes. This Is What It Found. – I was super impressed what Buzzfeed did here.
- The Best Machine Learning Resources – Machine Learning for Humans – Medium – tons of good resources here.
Economists write a lot about the mystery of why productivity is not increasing, with pieces such as this. There’s even a section on it in Wikipedia.
My own theory is that limited wage increases is also limiting the benefits of productivity aids. How I think this works is so:
- Employers wont raise wages for employees.
- Employers deploy technology that should result in productivity gains.
- Employees take the technology deployed and use them to decrease their efforts.
- The employer sees some productivity gains and assumes that is the limit for the technology deployed.
Look at this chart:
In much of the world economy, all the job growth is in the services sector (green line), not the manufacturing sector (red line). Achieving productivity gains in the manufacturing sector is more straightforward: replace people with robots and you are done. It’s not as straightforward as that in the services sector. In some services sector jobs, it is not possible to decrease effort without it being visible. But in many services sector jobs, it is. If employees cannot improve their lives by making more money, they may decide to do so by working less and working right up to the point where they don’t lose their job.
If you look at employment as a game, then we currently have a Nash equilibrium where the employees know that they won’t get paid more working for the same company, because that is the best strategy for the company. Therefore the best strategy for the employee is to minimize their effort without getting fired and while showing little if any productivity gains.
That’s to me is key reason why I think we have the productivity paradox.
I would add that the reason this is a paradox is because no one wants to admit that this is happening. It seems like a failure on both the employers and the employees side. The employee wants to be seen as a good worker and the employer doesn’t want to admit it could be paying more. Instead technology is brought in to solve an organizational problem, which is something technology cannot do.
(Chart from Business Insider).
It is striking to see what percentage of American capital attributed to slavery in the 18th and 19th centuries (the striped section in the chart above). In the late 18th century only agricultural land counted for more, and there slavery contributed to that too.
The American Civil War and the emancipation of those bound in slavery destroyed all that capital, and that was great and necessary. While it is wrong to consider slavery only in terms of money, it is impossible to talk about slavery in the United States without considering its relationship to the economy and capital. The capital that derived from slavery was massive.
In the U.K. the abolition of slavery resulted in the government providing capital back to the slave owners. It was a terrible omission that neither the U.K. nor the U.S. provided capital to the freed slaves. There are those, like Ta-Nehisi Coates, who argue that such capital in the form of reparation is due. Based on the chart above, a case could be made that it would be a tremendous amount of money.
(Chart above taken from “Capital in the Twenty-First Century” by Thomas Piketty)
There have been many articles written on UBI. (If you don’t know what it is, it’s universal basic income: a cash payment made to every individual in the country).
Two of the more interesting ones I’ve read are here: The UBI already exists for the 1% – Medium, and this one here (on how India is looking to do it).
UBI is coming. It may take some time though.
Is the FED (Federal Reserve System) broken? If not broken then certainly being strongly tested, as this piece shows to me: The Fed Is Searching for a New Framework. New Minutes Show It Doesn’t Have One Yet. – The New York Times.
Since the start of the Great Recession, the target interest rate has gone from just over 5% to just over 0% and has more or less stayed that way for over half a decade. (See the chart). After a very long pause, the chairwoman of the Federal Reserve has begun the process of raising interest rates, a process that her predecessors have engaged in over recent decades as they put their own distinctive stamp on the economy. (See A History of Fed Leaders and Interest Rates – The New York Times). Some of them, like Paul Volcker, have been hugely successful in shaping the economy. Others, like Alan Greenspan, also have shaped the economy hugely, but I would add, unsuccessfully. So what should the FED do?
Paul Krugman has his take, here. Perhaps an extreme inflation target is the answer, just like Volcker’s extreme interest rates were the answer for their time. However, I don’t think they are symmetrical, and the goals of a higher inflation target would be dampened down by other forces. Furthermore, the FED and most other central banks seem only capable dealing with tamping down inflation and not so capable when dealing with unemployment.
The Chairwoman is signalling she will be raising rates soon. We should see what the effect is, and how the economy and President Trump and Congress responds. If the economy goes into a recession, that would say to me the FED is broken. If the economy does not go into a recession, I would say this means the FED still has a limited role in managing the economy. Let’s see.
Should you become an entrepreneur if you are older? If you are an entrepreneur, should you hire older workers despite worrying they won’t be a good fit? This piece, Don’t Let Your ‘Senior Citizen’ Status Kill Your Entrepreneurial Spirit, makes the case that the answer to both questions is yes. Well worth reading if you have been asking yourself these questions.
And why is Colonel Sanders shown here? The article will explain.
(Image linked to is on Wikimedia)
In this piece, Are we killing Yonge Street? from NOW Toronto Magazine, there is a good discussion on what is happening to development on Yonge Street in Toronto. NOW reports that for a lot of development happening on Yonge Street, the facades of the existing building are kept and much of the development is happening behind it. The article argues that this is a bad thing, and they raise some good points.
What I think they don’t touch on are some of the alternatives. Toronto is fortunate in that there is development ongoing. For poor cities, the alternative is boarded up or demolished buildings and vacant neighborhoods. Instead, we have neighborhoods and buildings being improved. That’s good.
Another alternative is the old buildings being torn down and replaced with new storefronts and new buidlings. I think some of that is good, but I also think preservation of old buildings is also good.
When it comes to preservation and improvements of old buildings, I also think that some of them should be preserved outright. However, Toronto is a growing city, and in some cases, we need larger buildings. In that case, facadism is a good compromise.
Now whether or not facadism is effective or not depends on at least two things. The first is how well the new architecture uses the existing architecture. Done well, the marriage of the old and new building results in something that enhances the area and preserves the city while allowing it to grow. The second thing that determines if facadism is effective is how the new building affects the neighborhood. Here, I think, is the root of the problem. It’s not so much facadism as it is gentrification. Old buildings get preserved, but old stores do not. New developments can cause rents to rise, driving out the stores and organizations that made the neighborhood great. You get bank branches and big chain stores replacing old bookshops and cafes.
I hope the next phase of development tries to understand how to preserve not just the existing architecture, but the neighborhood as well. I realize that is a difficult task, but it is one worth trying to accomplish.
Then you want to read these two really good pieces on why it is brutally tough to get tickets to an event without paying a fortune:
What it comes down to is a very limited supply and a very high demand. But that’s obvious. Read the pieces to see just how it really plays out.
This piece by Nate Silver, How I Acted Like A Pundit And Screwed Up On Donald Trump in FiveThirtyEight, is ostensibly about how he messed up in his predictions on the rise of Donald Trump. What I think is worth reading is how he goes about his work and what he learned from his mistakes. Specifically, it’s a great study on how important models are and how a good model works and what it can tell us.
Related, Paul Krugman talks about his model here: Economics and Self-Awareness in The New York Times. Like Silver, he uses models both to understand and predict. Obviously they are modelling different things, but in both cases good models are the basis of their thinking and the work they do.
It’s likely too much to ask now, but eventually anyone doing analysis and making predictions should have to disclose the models they are basing their decisions upon. The opinions of anyone not having such models are likely not worth much.
While I knew things were rough in Detroit, this story, Volume of abandoned homes ‘absolutely terrifying’ (from DetroitNews.com), gives you a context of just how incredibly bad it is. Two take aways from that story. First, this statistic:
Since 2005, more than 1-in-3 Detroit properties have been foreclosed because of mortgage defaults or unpaid taxes
Two, this map of foreclosures:
The situation is terrible, but the story is worth reading and the visuals (e.g. a bigger view of that map) really illustrate the damage. Worth reading, especially if you have recently read some pieces, as I have, of good news coming out of Detroit.
This New Statesman interview of Yanis Varoufakis is astounding. The way he describes negotiations between Greece and other members of the Troika should not surprise me, and yet it does.
You might think: that can’t be right….he’s exaggerating for his own benefit. But many of the things Varoufakis states I have read referenced elsewhere, but in snippets.
Well worth the time spent reading it.
P.S. He has some interesting things to say about Piketty, as well. The link to his critique of Piketty is here.
Vox raises that question here: All this digital technology isn’t making us more productive – Vox, and it implies that because people are slacking off on the Internet. I think that is incorrect, and here’s why.
The chart that Vox piece has shows big producitivity gains from 1998-2003 and smaller gains after that.
From 1998-2003 was the peak adoption of the Internet by companies. In the early 1990s, companies started to adopt email. In the later 1990s companies started adopting the Web. To me it is not surprising that companies would become more productive and they shifted away from snail mail and faxes to email. And then companies shifted further and started offering services over the Web, I imagine they became much more productive.
Slacking off on the Internet has been a problem since the Web came along. I know, because I used to monitor web server traffic. I don’t think that is the issue.
I think it is more likely that companies grabbed the big productivity gains from the Internet at the beginning, and then those gains slowed down after.
So what about smartphones? Have they made people more productive? I think they have, but I also think that the gains in being able to access information remotely may have been overtaken by the sheer amount of information to deal with. Being able to deal with email remotely makes you productive. Having to deal with way more email than you ever had to in the 1990s because now everyone has it makes you unproductive.
Furthermore, many of the features on smartphones are aimed at personal use, not professional use. I think smartphones make us more productive personally, but less so professionall.y
I didn’t expect a positive review of Janet Yellen in the wsj, but this piece, linked to below, is really positive. Here’s a sample:
Steering central bank policy depends more than anything on assessing where the economy is heading. Yet, central bankers, surprisingly, are seldom picked for their forecasting acumen. More often they are former public servants, bankers or academics.
Then there is Janet Yellen.
Her forecasts as a Fed official have been strikingly accurate, as the release of 2009 transcripts to the Fed’s deliberations make clear. If she worked on Wall Street, she’d be a “hot hand.” This does not mean as chairwoman she is necessarily right; but it does suggest her forecasts deserve the benefit of the doubt.
via Janet Yellen, Forecasting Ace – Real Time Economics – WSJ. A really good piece.
Posted in money
Tagged economics, money, WSJ
I wrote about Piketty’s Capital in the Twenty-First Century here and here. As I said, I strongly encourage you to read it and take notes.
If you want a great summary of the book, I highly recommend this post: Piketty Explained: Summary of Capital in the Twenty-First Century by Thomas Piketty.
It’s superb. Peter Shirley, the author, has written a 30 second summary and a 15 minute summary, and when you finish both, you will have a very fast but very thorough introduction to the book. I am going to come back to this from time to time as a refresher to what I read in the book (as well as flip through the book again). Did you read Piketty but skip sections? Then review Peter’s post to see what you missed.
More good reasons to pick up Piketty before 2014 ends.
(The chart on world growth rates is from a link to Peter Shirley’s blog post.)
My previous post was a guide to reading Piketty’s Capital. As I was going through it, I also jotted down some rough notes on the book and things I thought as I was going along. My marginalia, so to speak. Here it is, for what it’s worth to you:
- Piketty’s book irked people for a number of reasons, including me initially. One reason, I think has to do with the grandness of his book. First, there’s the title. It implies this is a follow on to the great text by Marx. Second he does things like state fundamental laws of capitalism, as if economics were physics and Piketty is the 21st century Einstein. While Piketty can seem grand at time, he’s also humble in other parts. Throughout the book he often confesses to the limits of his approach based on the data (or lack of data) he has. He still has a lot of data and he has done a lot of analysis, but he is aware of the limits of it. This humility helped me get over the parts that irked me.
- For non-economists like me, I think the book is most enjoyable when Piketty relates economic theory with example in literature and history. His references to Austen and Balzac make his ideas less abstract and make them richer. Fortunately, he does this often.
- Some American critics would have you believe that Piketty is anti-capitalist / pro-socialist. I didn’t see that. I’d say Piketty is for open markets, strong on education, and democratic. From an American point of view, he may seem left wing, but to most of the developed world I would place him closer to the center, slightly left.
- One thing Piketty’s analysis can’t or doesn’t take into account is the exponential change in everything starting at the end of the 19th century. He touches on it a bit (pop growth rates on page 80), but this is factor. I believe that there is a correlation between growth rates and birth rates, with growth rates lagging birth rates. But this is a belief I have: I don’t have the ability to show this.
- I was surprised by how limited economic growth is. (Chart on page 94). As Piketty mentions, people think it should be in the 3-4% range, but is much more likely to hover around the 1% range. Yet even such growth rates have a huge impact over decades and centuries.
- Indirectly, Piketty makes the case for Naomi Klein’s thesis on disaster capitalism. The biggest opportunities for growth in the 20th century occur as a result of the World Wars. Take a look at the charts on page 97 to see what I mean. Wars are terrible for people and cities but good for economic growth.
- As I was reading the book in the summer, there were a slew of critics writing Think Pieces (or tweets!) against him and his book. The most ridiculous arguments against Piketty are the shallow ones, of course: the ones based on the book title, or that he is French, or that the book is all about new taxes. These arguments, mainly from American writers, reflect a lack of thought and the biases of Americans more than anything else. Critics of Piketty who write small articles on his book, criticizing this point or that, are missing the much bigger picture. Piketty, in presenting all of this data and analysis, is providing a broad stage to discuss capitalism. I think anyone wanting to take him on really has to do the same level of work. That’s the thing. Cherry picking is useless. Yes, it would be good to have more data. But this is the data available. If you want to criticize Piketty, you need more data, or you need to critique his data. If you want to show how technology is making inequality less not more, bring that data. Saying “Piketty is a red” or “this is not 19th century range” and thinking you are done just makes you look foolish and your arguments weak. (Of course you can believe what you like, but belief is not argument.)
- Another thing he doesn’t touch on is the destructive nature of IT on capital. Being an IT professional, I was wondering if he would examine capital in the 21st century from that perspective, since IT is having a greater and greater effect on our economies, and as more things become digital, the depreciation of capital related to those things accelerates. If you’d like to read more on that topic, you won’t find it here.
- It is interesting to note the stability of capitalism in the 19th century, at least in Europe. It was a conservative time politically, with limited warfare. Currency and other things economic were also stable then. No point here, just something that struck me as interesting.
- I believe that an accumulation of capital leads to anti-democratic measures by capitalists that result in revolutions or wars, which lead to the destruction of private capital. Piketty doesn’t go into this, but it would be interesting to read an analysis that shows a relationship between the accumulation of capital and the advent of wars and revolutions.
- I found this fact fascinating: after the Napoleonic wars and World War 2, Britain’s public debt was 200% of the GDP. 200%! I found this fascinating, first because there is a lot of worry now about the wealthiest nations having their public debt going over 100% of their GDP. Yet Britain’s was much much higher in those two cases. How did they reduced that debt and bring the percentage down from 200% to a much smaller number (as seen in the book)? Inflation. It was done over a very long period of time, but it is proof that high debt can be brought down and that it isn’t irreversible.
- Reading the section on slaves and capital made me think many things, including the idea that capital based on anti-democratic or inhumane means is precarious — think of capital that pollutes or depends on the deprivation of otherwise rights….it is unstable capital — and that capitalists and not just socialists should argue for an economic society based on democracy and human rights.
- One thing Piketty does well is whenever possible he links data from the US and Sweden because they are both relative outliers to the UK, France and Germany. It also highlighted to me how much the US lags (or leads, depending on your viewpoint) much of the developed world.
- Piketty is big on education. If anything, I think he gives it too much weight. People from better schools stay wealthy not just because of what they learn but who they connect with in such schools. (Maybe it is different in France, but I doubt it.) Establishment schools are smart enough to let new blood in but they are far from meritocracies. To me, Piketty seems to have a blind spot when it comes to academia that he doesn’t show elsewhere when talking about inheritance or super-managers.
- Piketty makes the case that taxes are better than debt. I made this note: “The concern for progressives is that capitalists will drive down both taxes and debt by abusing social programs.” But I don’t know why! 🙂 Ah well…it was likely a good thought at the time of reading it.
- Piketty talks at the end about the contradiction of capitalism is r > g. My belief is that this formula should be more complicated and that when you add a time factor in there and some other dependencies, you see have a better model and formula (or formulae) on how capitalism corrects itself, either through war, or revolution, or other drastic social change. But this is just another belief I have.
As you are reading it, you will likely have your own notes and marginalia. Let me know what you think.