Friday, June 13, 2014

Assorted links: euro crisis, neoclassical synthesis, guns

Yanis Varoufakis and Jamie Galbraith have a wonkish article explaining the major differences in approach for the two major approaches to saving the euro, Whither Europe? The Modest Camp vs the Federalist Austerians Open Democracy 06/11/2014. They are both prominent advocates of the Modest Camp.

Dutch Finance Minister Jeroen Dijsselbloem, currently president of the "Eurogroup" of finance ministers, gives a variation of the Austerity Gospel, suggesting that sinner eurozone countries should be allowed to ease up on the austerity a little bit as long as they agree to even more drastic measures for internal devaluation, e.g., reducing real income for most people: Eurogruppen-Chef: "Mehr Zeit für Extrareformen" Der Standard 10.06.2014. He's part of the social-democratic Labour Party in the Netherlands. This nonsense is supposed to be a left-center alternative. No wonder the euro zone is in crisis and European Social Democracy in general, as well.

Paul Krugman explains the "neoclassical synthesis" in economics (Keynes in bad times, Alfred Marshall in good) and why reality is constantly challenging it, especially now: Synthesis Lost 06/12/2014. Krugman has been indicated for several years now that over time, he's had increasing doubts about the "classical" part of the synthesis.

He also has another post reflecting on errors, Including this one:

I worried a lot in 2010-2012 about a euro breakup. And here too I had a fundamentally flawed model. But the flaw wasn't in my economic model, which has worked pretty well, but in my implicit political model: I simply failed to appreciate the incentives facing European elites and how willing they would be to do whatever it takes, both in debtor countries and at the ECB, to avoid an outright rift. So, fundamental change called for — but in my political model, not my economic model.
He has mentioned this before, that he judged that democratic governments wouldn't put up for as long as they have with the level of sacrifice and economic hopelessness that Angela Merkel's austerity policies continue to impose on Cyrus, Greece, Ireland, Italy, Portugal and Spain. I have the impression, too, that at least in the 2009-12 period, Krugman was underestimating the emotional power of "the European project" (the EU) on both elites and the public there.

That said, I think he's being a bit hard on himself over that one. Back in 2012, he wrote in Dornbusch's Law And The Euro 07/21/2014:

It really does seem as if we're looking at Dornbusch’s Law in action:

The crisis takes a much longer time coming than you think, and then it happens much faster than you would have thought, and that's sort of exactly the Mexican story. It took forever and then it took a night.

July 2012 was the month after the ECB reversed course and committed itself to a bond purchasing program that has succeeded in deterring major speculations against eurozone countries' bonds for two years now.

I think that's still a good guideline: when the euro crisis goes into another acute phase, it will seem to news consumers and most pundits like a bolt out of the blue.

Krugman also has a blog post (Fall of an Apparatchik 06/11/2014) and a column (The Fix Isn't In: Eric Cantor and the Death of a Movement New York Times 06/12/2014) on his thoughts at the momentary political demise of Eric Cantor, the two of them very similar but not identical. He makes a useful point that we aren't hearing from the usual suspects among the Pod Punditry, who still imagine that some version of the Nelson Rockefeller/Barry Goldwater split of 1964 is still operating in the Republican Party:

I don't mean that conservatism in general is dying. But what I and others mean by "movement conservatism," a term I think I learned from the historian Rick Perlstein, is something more specific: an interlocking set of institutions and alliances that won elections by stoking cultural and racial anxiety but used these victories mainly to push an elitist economic agenda, meanwhile providing a support network for political and ideological loyalists.

By rejecting Mr. Cantor, the Republican base showed that it has gotten wise to the electoral bait and switch, and, by his fall, Mr. Cantor showed that the support network can no longer guarantee job security. For around three decades, the conservative fix was in; but no more.

To see what I mean by bait and switch, think about what happened in 2004. George W. Bush won re-election by posing as a champion of national security and traditional values — as I like to say, he ran as America’s defender against gay married terrorists — then turned immediately to his real priority: privatizing Social Security. It was the perfect illustration of the strategy famously described in Thomas Frank’s book "What's the Matter With Kansas?" in which Republicans would mobilize voters with social issues, but invariably turn postelection to serving the interests of corporations and the 1 percent. [links in original]
The New Republic's spanking of Chris Hedges for alleged plagiarism this week criticized him for inserted weblinks into quotes. It never occurred to me before that such could be construed as plagiarism. Does omitting quotes from a passage you're quoting that has links in its web version count as plagiarism, too? I'm thinking, no. But I specified on that last quote!

I guess that also means I have to check the links to make sure they're not to so nasty porno site or something.

Elias Isquith on the NRA's current marketing strategy, NRA’s "really big problem": Why it’s dependent on a dwindling fringe Salon 06/13/2014, quoting Josh Sugarman of the Violence Policy Center:

... hunting, hunting as an activity is fading away — so what you're finding is that the activists ... the NRA relies upon are those who buy into its paranoid language and truly believe the government is the enemy ... [W]hen the NRA is criticized for this or confronted with their own language, they fall into this excuse of ”it's just direct mail rhetoric; it’s just articles to engage our membership. It really is a risk-free activity,” and what we’re seeing is, that’s not the case. It’s not risk-free activity. The NRA’s validating role cannot be matched by any other organization, and most importantly — and this is where it all comes full circle — the NRA’s the organization assured that those who want to live out these wild fantasies have the exact tools to accomplish it.
The NRA with the eager help of the Republican Party from Congress to statehouses, of course.

And a story about real-life people who really did have to rely on private weapons to protect themselves against the political of segregation, Amelia Thomason-Deveaux, Armed Resistance in the Civil Rights Movement: Charles E. Cobb and Danielle L. McGuire on Forgotten History The American Prospect 06/11/2014. People for whom today's NRA and most Republicans have less than zero sympathy.

And, oh yeah, the IMF thinks several countries are looking at another developing housing bubble: IMF Global Housing Watch (accessed 06/13/2014).

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