tag:blogger.com,1999:blog-6245381193993153721.post7979816573074175444..comments2024-03-17T00:23:24.896-07:00Comments on Social Democracy for the 21st Century: A Realist Alternative to the Modern Left: Reply to “Unemployment, Deflation and Growth During the Period of 1873–1896”Lord Keyneshttp://www.blogger.com/profile/06556863604205200159noreply@blogger.comBlogger8125tag:blogger.com,1999:blog-6245381193993153721.post-73513567877915185892012-09-08T20:56:31.474-07:002012-09-08T20:56:31.474-07:00:rolleyes:
I assume you've never read "T...:rolleyes:<br /><br />I assume you've never read "The Triumph of Conservatism" by Gabriel Kolko.<br /><br />Don't let the title fool you, he's supposed to be a new left historian. <br /><br />http://www.amazon.com/Triumph-Conservatism-Gabriel-Kolko/dp/0029166500Anonymoushttps://www.blogger.com/profile/11822025819046965291noreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-84784746443196031842012-09-07T06:55:03.618-07:002012-09-07T06:55:03.618-07:00It's always amused me that 'free market...It's always amused me that 'free market' advocates never seem to go on about how they need to beef up anti-trust legislation and break apart large companies to make sure that competition continues to work.<br /><br />NeilWhttps://www.blogger.com/profile/11565959939525324309noreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-16167927441934586592012-09-07T00:51:21.839-07:002012-09-07T00:51:21.839-07:00Now that I think about it, the deflation and the t...Now that I think about it, the deflation and the tendency toward monopoly were probably linked. I've never read anything regarding the 1870s+ on this, but its well known that the monopolies that formed in the 1930s were spurred on by deflation.<br /><br />Deflation induces debt deflation. Indebted companies that were previously solvent tend toward bankruptcy. These perfectly viable companies are then taken over by less indebted companies and this leads to monopoly and acts as a major restriction on laissez faire.<br /><br />So, there's a certain irony when the Austrians champion mild, long-period deflation as it tends to induce bankruptcies of viable companies which in turn leads to monopoly and responses against monopoly (trade unions, easy money politics like the Greenback Party etc.).<br /><br />Once again, the simplifications of the Austrians' historical mythologies are shown up for what they are: fantasies of some sort of self-regulated Golden Era that can be recreated through using certain economic policies. I believe the psychoanalysts would refer to it as a fantasy of returning to the womb (which, suggestively, is linked to tendencies to hoard -- gold bugs! LOL!).Philip Pilkingtonhttp://www.nakedcapitalism.comnoreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-15148349504899484792012-09-06T21:32:27.819-07:002012-09-06T21:32:27.819-07:00The US's move toward foreign intervention, und...The US's move toward foreign intervention, under both Cleveland and McKinley, was also the result of the 1890s' "fairly crappy economic growth". There was a naive understanding of slumps as being caused by overproduction/underconsumption; it was thought that foreign markets could absorb the surplus. And thus Hawaii, Cuba, the Phillipines, China, and a string of Latin American republics became targets.Willhttps://www.blogger.com/profile/14943136764424893492noreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-53159080863580024032012-09-06T14:01:23.943-07:002012-09-06T14:01:23.943-07:00Any talk of this kind is not serious until you use...Any talk of this kind is not serious until you use Alex Gheg's scale for economic growth. Quantity, quality, variety and convenience in one equation. http://www.youtube.com/watch?v=u6tFLGpcOpEMrIlirhttps://www.blogger.com/profile/11613313452071283534noreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-33236093896561252412012-09-06T12:24:48.484-07:002012-09-06T12:24:48.484-07:00Here's a bit of real history for your Austrian...Here's a bit of real history for your Austrian friends. This is from Hobsbawm's Age of Capital:<br /><br />"The new era which follows the age of liberal triumph was to be very different [Hobsbawm dates the end of the liberal era around 1971]. Economically it was to move away rapidly from unrestrained competitive private enterprise, government abstention from intereference and what the Germans called 'Manchesterismus' (the free trade orthodoxy of Victorian Britain), to large industrial corporations (cartels, trusts, monopolies), to very considerable government interference, to very different orthodoxies of policy, though not necessarily of economic theory [LOL!]. The age of individualism ended in 1870, complained British lawyer A.V. Dicey, the age of 'collectivism' began." (p. 354)<br /><br />This is not controversial at all. As Hobsbawm points out, even the free-traders recognised the shift. It is only a few idiot Austrians who only read other idiot Austrians that would debate the periodisation here (in fact I've read Austrians who refer to Dicey and his pronouncements, which shows some are not completely blind). Their ignorance is astounding. Please inform them of their miseducation and general clownishness. Philip Pilkingtonhttp://www.nakedcapitalism.comnoreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-77807059506379407542012-09-06T11:58:47.136-07:002012-09-06T11:58:47.136-07:00Lord Keynes,
As you may recall, earlier in the ye...Lord Keynes,<br /><br />As you may recall, earlier in the year I said I would work on a paper in the summer dealing with the Panic of 1873. While my overall project which planned to encompass all the relevant economic history was not completed, I did manage to finish a much smaller paper that deals less with history and more economic statistics on the time period. It was sent for a contest earlier in the month, and I will let you know if anything comes of it.<br /><br />Anyways, <br /><br />While I cannot speak for the person who posted the initial argument, I would say that in general, “mainstream” economics is against deflation. This does not imply that they argue that output cannot increase with falling prices, but that in general with regards to monetary policy most major thinkers, including those at the Fed, what is taught in school as orthodox, and probably yourself would advocate a policy where prices slowly increase 1-3% per annum in normal times, and not allow prices to fall. So, while “mainstream” economists may readily admit that falling prices from an increase in output may not be detrimental, most economists would rather have that not occur. I do not think I am wrong in this respect then to conclude that most economists are against deflation, or they would prefer that it would not occur. <br /><br />I have not had a time to fully study per capita GNP growth rates for this time period. However, it is important to note that an economy can still be progressing even if real GNP per capita or real wages slows down its rate of growth or remains constant. This is due to the fact that the labor supply may increase from immigration, augmenting the total population and lowering wage rates. An improvement in the standard of living comes from bringing more workers from dirt poor to poor-middle class rather than improving the overall standards of the middle class. This happened in America during this time period as real wages grew slower per year from factor arbitrage. Poorer countries actually had some of the largest real wage rate growth from decreases in labor supply from emigration. An illuminating paper on this is Jeffrey Williamson “Globalization, Labor Markets and Policy Backlash in the Past”. <br /><br />I would be careful in calling Davis’ contraction from 1873-1875 as a 3 year slump. The NBER chronology lists the recession as starting in October 1873. Even Davis shows growth from 1872-73. So, using Davis’ figures at most the recession, assuming it ended in December 1875 lasted less or equal to 2.25 years. In fact, rather than showing that the mid 1870s was “hardly a prosperous period”, both Davis’ papers make the remarks that the depression of the 1870s was shorter and shallower than previously believed. <br /><br />I have already spoken in multiple posts about my comments on the B&G data and its relation to the Vernon unemployment series, and I will not repeat myself here.<br />Patchnoreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-6065172785169368082012-09-06T11:57:12.822-07:002012-09-06T11:57:12.822-07:00More bizarro history from the "empirics don&#...More bizarro history from the "empirics don't matter according to our epistemology" Austrians. So, the Long Depression didn't happen. It was just peoples' heads. Next, I guess the Great Depression will be seen as an era of prosperity.<br /><br />Since I've already pointed out that during the above cited period there were "distortionary" interventions from the US central bank, I'll make another historical point: this was the era in which the trade union movement rose to prominence. This was not a coincidence. And out of this movement eventually arose the RSDLP and from there, the Bolsheviks.<br /><br />It's generally recognised that due to the fairly crappy economic growth of the late-nineteenth century workers organised. It is also generally recognised that in this period in history many large monopolies were consolidated. This, again, is not a coincidence, if you are in any way familiar with economic history -- as opposed to Austrian-style historical mythology.<br /><br />Please make them aware of this or repost this on their boards. I'd sooner go to a Scientologist personality test than be caught over there.Philip Pilkingtonhttp://www.nakedcapitalism.comnoreply@blogger.com