The austerity delusion

theguardian.com/business/ng-interactive/2015/apr/29/the-austerity-delusion
Excellent Guardian article by Paul Krugman

May 2010, as Britain headed into its last general election, elites all across the western world were gripped by austerity fever, a strange malady that combined extravagant fear with blithe optimism. Every country running significant budget deficits – as nearly all were in the aftermath of the financial crisis – was deemed at imminent risk of becoming another Greece unless it immediately began cutting spending and raising taxes. Concerns that imposing such austerity in already depressed economies would deepen their depression and delay recovery were airily dismissed; fiscal probity, we were assured, would inspire business-boosting confidence, and all would be well.

People holding these beliefs came to be widely known in economic circles as “austerians” – a term coined by the economist Rob Parenteau – and for a while the austerian ideology swept all before it.
Continue reading “The austerity delusion”

Reason above all else

About Ayn Rand

While in high school, she determined that she was an atheist and that she valued reason above any other human virtue.

Ayn RandAyn called her philosophy “Objectivism”, describing its essence as “the concept of man as a heroic being, with his own happiness as the moral purpose of his life, with productive achievement as his noblest activity, and reason as his only absolute.” She considered Objectivism a systematic philosophy and laid out positions on metaphysics, epistemology, ethics, political philosophy and aesthetics.

What an utterly inspiring woman.
en.wikipedia.org/wiki/Ayn_Rand

Climate Change & the parallel of slavery

In “Climate change as a cultural and behavioral issue: Addressing barriers and implementing solutionsAndrew J. Hoffman draws a very timely analogy –
Looking at Climate Change through the parallel of slavery:

“Climate change today still resides in the ‘pre’ social fact phase, awaiting public acceptance. But just how big a shift will this be? To that point, I turn to the abolition of slavery.

In short, the magnitude of the cultural and moral shift around climate change is as large as that which accompanied the abolition of slavery. Adam Hochschild, in his book Bury the Chains, makes the startling point that in the 18th century more than 75% of the world’s population was in slavery or serfdom. Humans were a primary source of energy and wealth, particularly for the dominant world power, Great Britain. Hochschild points out that “if you stood on a London street corner and insisted that slavery was morally wrong and should be stopped, nine out of 10 listeners would have laughed you off as a crackpot.” Abolition would lead to a collapse of the economy and their way of life. Abolitionism was a challenge to the underlying beliefs upon which the Empire was built. At the time, few people saw a moral problem with this critical institution. People simply did not believe, as we do today, that all people have a right to freedom and equality. Slavery was seen as the natural order of things, unquestioned and even supported by many through the words of the Bible. It took roughly 100 years to abolish slavery in the British Empire, and Hochschild points out that, by the end of the 19th century, slavery was, at least on paper, outlawed almost everywhere.

Now, flash forward to today. We live in a fossil fuel-based economy. Fossil fuels are our primary source of energy and support our entire way of life. As scientific evidence mounts that this critical institution is causing changes to the global climate, we are faced with a technological and social dilemma. Calls to end our dependence on fossil fuels are being met with the same kind of response as did calls to end our dependence on slavery: such a move would wreck the economy and the way of life that is built upon it. If you stood on a New York City street corner and insisted that burning fossil fuels was morally wrong and should be stopped, listeners would laugh you off as a crackpot. There is a vast physical infrastructure that depends on oil, and it cannot be simply replaced without great disruption. Abolition of the primary source of energy in the world is out of the question, both socially and technologically.

Just as few people saw a moral problem with slavery in the 18th century, few people in the 21st century see a moral problem with the burning of fossil fuels. Will people in 100 years look at us with the same incomprehension we feel toward 18th-century defenders of slavery? If we are to address the problem adequately, the answer to that question must be yes; our common atmosphere will no longer be seen as a free dumping ground for greenhouse gases and other pollutants. But this value shift will require humankind to come to terms with a new cultural reality.

The first piece of this reality is that humankind has grown to such numbers and our technologies have grown to such a capacity that we can, and do, alter the Earth’s ecological systems on a planetary scale. It is a fundamental shift in the physical order – one never before seen, and one that alters the ethics and morals by which we judge our behavior as it relates to the environment around us and to the rest of humanity that depends on that environment.

The second piece of that reality is that we share a collective responsibility and require global cooperation to solve it. The coal burned in Ann Arbor, Shanghai or Moscow has an equal impact on the environment we all share. The kind of cooperation necessary to solve this problem is far beyond anything we, as a species, have ever accomplished before. International treaties to ban land mines or eliminate ozone-depleting substances pale in comparison. Looking at climate change through the parallel of slavery helps us to see the magnitude of the issue before us.”

Excerpt from: Hoffman, A. (2010) “Climate change as a cultural and behavioral issue: Addressing barriers and implementing solutions,” Organizational Dynamics, 39 (4): 295-305.
read the full pdf here

Global CO2 emissions traced 1854-2010

Tracing anthropogenic carbon dioxide and methane emissions to fossil fuel and cement producers, 1854–2010

This paper presents a quantitative analysis of the historic fossil fuel and cement production records of the 50 leading investor-owned, 31 state-owned, and 9 nation-state producers of oil, natural gas, coal, and cement from as early as 1854 to 2010. This analysis traces emissions totaling 914 GtCO2e  – 63 % of cumulative worldwide emissions of industrial CO2 and methane between 1751 and 2010 –  to the top 90 global TNCs “carbon major” entities based on the carbon content of marketed hydrocarbon fuels (subtracting for non-energy uses), process CO2 from cement manufacture, CO2 from flaring, venting, and own fuel use, and fugitive or vented methane. Cumulatively, emissions of 315 GtCO2e have been traced to investor-owned entities, 288 GtCO2e to state-owned enterprises, and 312 GtCO2e to nation-states. Of these emissions, half has been emitted since 1986. The carbon major entities possess fossil fuel reserves that will, if produced and emitted, intensify anthropogenic climate change. The purpose of the analysis is to understand the historic emissions as a factual matter, and to invite consideration of their possible relevance to public policy.

download the paper as pdf

read the original article here

On the Phenomenon of Bullshit Jobs

It is imperative that you read this!

Ever had the feeling that your job might be made up? That the world would keep on turning if you weren’t doing that thing you do 9-5? David Graeber, Professor of Anthropology at the London School of Economics, explored the phenomenon of bullshit jobs – everyone who’s employed should read carefully…

“… a corporate lawyer working in a prominent New York firm [sic] was the first to admit that his job was utterly meaningless, contributed nothing to the world, and, in his own estimation, should not really exist.
There’s a lot of questions one could ask here, starting with, what does it say about our society that it seems to generate an extremely limited demand for talented poet-musicians, but an apparently infinite demand for specialists in corporate law? (Answer: if 1% of the population controls most of the disposable wealth, what we call “the market” reflects what they think is useful or important, not anybody else.) But even more, it shows that most people in these jobs are ultimately aware of it. In fact, I’m not sure I’ve ever met a corporate lawyer who didn’t think their job was bullshit. The same goes for almost all the new industries…”

read the entire article here strikemag.org/bullshit-jobs

Individualism

Art is individualism, and individualism is a disturbing and disintegrating force. There lies its immense value. For what it seeks is to disturb monotony of type, slavery of custom, tyranny of habit, and the reduction of man to the level of a machine.

Oscar Wilde “The Soul of Man under Socialism”

Smart no more

Watching my fellow humans dawdling away on all their electronic devices and doohickeys whilst developing the attention span of a fruit fly, I already had the vague feeling that us humans we’re not spinning upwards anymore… well now here’s an article by Tia Ghose @ LiveScience who had the same feeling, and investigated it…

Humans may be gradually losing intelligence, according to a new study.

The study, published in the journal Trends in Genetics, argues that humans lost the evolutionary pressure to be smart once we started living in dense agricultural settlements several thousand years ago.

“The development of our intellectual abilities and the optimization of thousands of intelligence genes probably occurred in relatively non-verbal, dispersed groups of peoples [living] before our ancestors emerged from Africa,” said study author Gerald Crabtree, a researcher at Stanford University, in a statement.

Since then it’s all been downhill, Crabtree contends…

Read the whole article here http://www.livescience.com/24713-humans-losing-intelligence.html

Lets hope it’s over…

“My gut feeling is the big expansion of coal in India is not going to happen, and they are going to leapfrog into renewables.” – Tim Flannery

Taken from “Coal? It’s Over” by Mike Seccombe – A great read about Australia’s insane/reckless fixation on fossil fuels.
View the whole article here @ The Global Mail

Patents are evil

Excellent article about patents by Pieter Hintjens.

While politicians see patents as an easy measure of industrial power, the reality is far darker. Patents act more like a legislative parasite that consumes the industrial base, and replaces it with cartels and trolls. Essentially, as soon as patents are introduced into a sector and start to bite — after a delay of five to ten years — they tip the economics back to front. Producing new products becomes dangerous, while buying new patents becomes profitable.

The damage is often invisible until much later. Large firms accept the cost of patent conflicts as the price of doing business and a useful barrier to smaller competitors. Small firms try to remain under the radar, assuming that trolls will not see them (yet). Patent deals are typically secretive, so most conflicts remain invisible. Since innovation cycles are often many years, and patents take many years to be examined and granted, everything may be going very well, for many electoral cycles, before the public lawsuits explode.

By the time every large firm is embroiled in five, ten, a hundred patent lawsuits in parallel, it is too late. The only way to win a war is to buy bigger weapons. Eventually the trolls get their pound of flesh, the large firms all settle into comfortable cartels, the small innovators go elsewhere, and peace returns.

The market is, by this stage, effectively dead. We get the Microsofts and the Nokias. Large firms do not innovate well. The general model is to buy smaller innovators and then mass-market those new ideas. But patent wars push small innovators out of the market.

An optimistic viewpoint would say that parasites eventually reach equilibrium with their hosts, and it is only when they jump to new hosts that they are deadly. A pessimistic viewpoint would say that it is the newest fields of technology — software, alternative energies, genetics — that are the most essential to human survival, and the most vulnerable to the spread of the patent system.

At their core, patents reflect an 18th century view of the market. The basis for patents is as valid as the old theory that disease spread by “bad air”. We have used science and evidence to create progress in every other field. It is ironic that the patent system, claiming to be essential to progress, depends on old faith-based arguments that were discredited 150 years ago.

So, we have an old discredited system that rejects reform, that infiltrates the political and business establishment, that turns living markets into zombies run by cartels and trolls, that spreads to vulnerable, essential areas of technology, that puts humanity’s very survival at stake. The conclusions and next steps are yours to make.

Read the full article here: http://www.ipocracy.org

three main myths about banking

Telegraph.co.uk/finance Bank-reform-held-back-by-lobby-group-myths-BoE-member-Robert-Jenkins-claims

He outlined three main myths propagated by the banking lobby. The first was that reform, principally the demand for larger loss-absorbing capital buffers, was a choice “between safety and growth”. “The banking lobby would have us believe that higher capital requirements and lower leverage will damage economic growth and retard the recovery,” he said. “Bankers have exploited this fear.”

Mr Jenkins claimed that the argument was false because more capital would not limit the amount of lending a bank could do, but would make it safer and therefore lowered its funding costs. Banks have claimed the opposite was the case due to their adherence to “return on equity” (RoE) targets, which ignore risk.

The second myth was that unless RoE was high, shareholders would not invest and capital could not be raised. Mr Jenkins dismissed the claim, saying: “The prospective investor is no longer interested in promises of short-term RoE, he is interested in achieving attractive risk-adjusted returns.”

The third myth was that governments cannot afford to over-regulate for the risk of losing financial centres. However, he said: “In a world of increased risk awareness, letting your banks off the capital hook will likely damage not enhance their ability to compete.”

Mr Jenkins also suggested that banks should be subjected to far higher capital and leverage ratios but fewer complicated rules in return.