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Month: September 2013

Private greed, public innovation, by @DavidOAtkins

Private greed, public innovation

by David Atkins

Mariana Mazzucato makes an excellent point about the “public debt is hurting growth and innovation” rhetorical scam:

Is government debt slowing economic growth, if not impeding it? The world-wide economic crisis that began in 2007 has kept that question alive, despite the fact that it was private debt that caused the crisis in the first place. But attempts to curb the crisis have also led to an explosion of public sector expenditures like bank bailouts and unemployment insurance that have ballooned debt levels. At the same time, lower tax receipts due to falling incomes have prompted even more borrowing.

Yet amnesia and dogma have conflated the public debt that helped cure the crisis with the private debt that caused it. The Reinhart-Rogoff saga seems to have ended with evidence winning out over ideological fiction. That’s because the government debt threshold these noted economists supposedly discovered — surpass a 90 percent ratio of debt-to-GDP and you’re screwed — seems to have been based on statistical error. But despite the correction, countries across the globe are still being asked to slash spending in hopes of kick starting economic growth.

My own work shows the utter foolishness of such a strategy. What matters is not the absolute size of debt, but what that debt consists of. Throughout history, strategic government expenditures have played a key role in spurring economic growth. Indeed, by forcing the world’s weakest economies to cut public spending — in key areas like education, research and health — their potential for long-run growth is weakening. Spain, for instance, has cut its research spending by 40 percent since 2009. Will this help it create the kind of goods and services the world might want to buy — and be as competitive as its Nordic neighbors? It seems wildly unlikely.

The key question is simple: what causes GDP growth? And the answer from economists is that, at the very least, spending on education, human capital, and research are tightly related to it. Indeed, Robert Solow, who won the Nobel Prize in Economics in 1987, found that close to 90 percent of growth is not explained by the usual suspects, capital and labor. They account for only 10 percent. So Solow called the unaccounted-for 90 percent the “residual.” And what drove the residual? It had to be technology. And how is technology fostered? More often than not, down through history, by government investment, from the roads of ancient Rome to the Internet of modern America….

I have been pushing a very different view, as embodied in my recent book “The Entrepreneurial State: Debunking Private vs. Public Sector Myths.” I argue that businesses are typically timid — waiting to invest until they can clearly see new technological and market opportunities. And evidence shows that such opportunities come when large sums of public money are spent directly on high risk (and high cost) technological missions. This raises debt of course, but also GDP, keeping the ratio of debt-to-GDP in check.

These missions are expensive precisely because the government does much more than just solve market failures. It intervenes in both basic and applied research and even provides early stage seed finance to private companies. Indeed, Small Business Innovation Research (SBIR) grants have funded a higher percentage of early stage seed finance than private capital. This is because private finance is too risk-averse — afraid — to engage with industries characterized by high technological and market risk. The fear explains why we have seen venture capital entering, in industry after industry, only decades after the initial high risk has been absorbed by government.

Mission-oriented public investment put men on the moon, and later, lead to the invention and commercialization of the Internet, which in turn has stimulated growth in many sectors of the economy. Indeed, as I describe in the longest chapter of my book, the U.S. government has been a leading player in funding not only the Internet but all the other technologies — GPS, touchscreen display, and the new Siri voice-activated personal assistant — that make the iPhone, for example, a miracle of American technology.

The public invests in medicine and technology, and the private sector ends up reaping the rewards.

This isn’t all bad, mind you. One needn’t look farther than the Soviet Union to see that purely centrally planned command and control economies don’t run efficiently or as planned. But what it does mean is that when the private sector reaps the benefits of public investment, expanding the pool of both labor and capital while refining those innovations, it needs to pay back into the system to allow for more innovations as well as to make sure the government can fill in the many gaps of society that the private sector and charity cannot hope to cover. That’s how the system is supposed to work.

The Right has totally bought into its own press clippings that the private sector is the economic and technological innovator. Conservatives have broken the economic and social contract that made the system work.

To be fair, globalization and mechanization were going to destroy that system regardless by increasing productivity and profit exponentially while reducing jobs and wages. But conservatives have hastened the system’s demise.

So what comes next? If not the old style of planned command-and-control economies that have already been proven not to work, either, then what? For now, the answer must be to regain the balance that prevailed during the middle of the 20th century, when labor was the equal of capital, and capital feared the power of labor. We’ll have to cross the globalization and mechanization bridge from there.

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Spy vs Spy

Spy vs Spy


by digby

I have often said that my greatest literary influence was MAD Magazine. I cannot tell a lie. It’s not very lofty and certainly betrays my age, but it is what it is.

And it’s because of stuff like this:

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Voices Calling

Voices Calling

by digby

I have always thought that one of the most horrible aspects of certain mental illnesses is the fact that the voices who are speaking to the sufferer seem to be so mean and violent. For instance, a homeless woman has lived in my neighborhood for years and I’ve heard her have the same argument with one of them over and over again in which she’s threatening to call the cops unless they get off her property. It escalates until she’s just screaming epithets. It’s hugely stressful to the lady, obviously, and it’s stressful to listen to. I can’t imagine how difficult it must be to live with a raging argument in your head like that.

Anyway, in the wake of the navy yard shooting where there is evidence that the shooter was hearing voices, there’s been some writing on the subject. This piece in the New York Times was especially interesting:

An unsettling question is whether the violent commands from these voices reflect our culture as much as they result from the disease process of the illness. In the past few years I have been working with some colleagues at the Schizophrenia Research Foundation in Chennai, India, to compare the voice-hearing experience of people with schizophrenia in the United States and India.

The two groups of patients have much in common. Neither particularly likes hearing voices. Both report hearing mean and sometimes violent commands. But in our sample of 20 comparable cases from each country, the voices heard by patients in Chennai are considerably less violent than those heard by patients in San Mateo, Calif.

Describing his own voices, an American matter-of-factly explained, “Usually it’s like torturing people to take their eyes out with a fork, or cut off someone’s head and drink the blood, that kind of stuff.” Other Americans spoke of “war,” as in, “They want to take me to war with them,” or their “suicide voice” asking, “Why don’t you end your life?”

In Chennai, the commanding voices often instructed people to do domestic chores — to cook, clean, eat, bathe, to “go to the kitchen, prepare food.” To be sure, some Chennai patients reported disgusting commands — in one case, a woman heard the god Hanuman insist that she drink out of a toilet bowl. But in Chennai, the horrible voices people reported seemed more focused on sex. Another woman said: “Male voice, very vulgar words, and raw. I would cry.”

Isn’t that wild? I guess it stands to reason that the voices would reflect the culture, and maybe it necessarily reflects the dark underbelly of that culture. But the dark underbellies of these two cultures are pretty starkly different, aren’t they?

We’ve had a lot of incidents in which a mentally ill person gets a hold of guns and shooting up places filled with innocent bystanders. Now what do you suppose it is in our culture that could infiltrate the mind of the mentally ill person whose internal voices are telling him to “go to war.”

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Cruz Control

by digby

To me this guy sounds like a McCarthyite used car salesman, but I can see why the right likes him. He’s got an answer for everything and it’s always exactly what they want to hear:

Wallace: Senator, I think it’s fair to say that you have ticked off a whole bunch of your fellow Republicans who feel that you have gotten them in this fight without an endgame, without a strategy. I want to put some of their criticisms, they’ve gone on the record on the screen. Congressman Tim Griffin wrote, ‘So far, Senate Republicans are good at getting Facebook likes and town halls, not much else. Do something.’ Republican congressman Pete King of New York calls you a fraud. ‘If he can deliver on this, fine. If he can’t, he should keep quiet from now on and we should listen to them,’ and Sen. Bob Corker of Tennessee said this, ‘I didn’t go to Harvard or Princeton,’ which you did, ‘but I can count.’ Republicans, especially in the House say that you are pushing them into a fight that you don’t know how to finish.

Cruz: …

Wallace: Senator?

Cruz: Well, look. There are lots of folks in Washington who choose to throw rocks, and I’m not going to reciprocate. I’m not going to do likewise. Listen, let me tell you about a broader problem. A broader problem is that we have got career politicians in both parties in Washington who aren’t listening to the American people. I spent the entire month of August traveling the country speaking to people, and the American people are hurting because Obamacare isn’t working.

He’s nuts. But he’s good. (The simple fact that he can say with a straight face that people are hurting because Obamacare isn’t working is an astonishing political feat.) I doubt he could get a majority of this country to vote for him, but I think he could easily get a majority of Republicans to do it.

Here’s how it’s playing out in the Senate according to Robert Costa:

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Your Daily Grayson: Benghazi, the scandal that never was

Your Daily Grayson: Benghazi, the scandal that never was

by digby

I’m pretty sure that the right wing thinks Benghazi! is just another word for Whitewater!. They need these simple one-word rallying cries to gather the flock. It really doesn’t matter what it means.

I think their problem today is that they are well-known to be kooks on just about every subject and the country no longer has the luxury of wallowing in phony scandals as it thought it did back when it had no identifiable “enemies”, low unemployment and a once-in-a-generation technology boom. Things have changed.

Benghazi!™ is unlikely to evoke any reaction among the American people beyond a yawn. We’re dealing with a lot of stuff here.

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They’d rather die than help the “others”

They’d rather die than help the “others”


by digby

In the post below I babbled about why the Republicans are so upset about the health care reform even though it was originally promoted by the conservative Heritage Foundation. Silly me.  This is why:

That’s a map showing where the uninsured and insured population of Los Angeles are located. And as you can see it’s LA’s inner city where the most uninsured members of the population live.

I don’t think we need to ask anymore why the right is against it. As with everything else, they are willing to sacrifice their own security and the well-being of everyone in the country if it means they can deny people of color any kind of benefit. Underneath it all, this is what they hate about Big Government and it’s what they hate about Obamacare.

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Dealing with Obamacare hysteria

Dealing with Obamacare hysteria

by digby

My good friend the struggling single mom has recently taken a job in the insurance industry. (It pays terribly so she has to work two jobs, of course, but it’s better than nothing.) I spoke with her yesterday and she tells me that the votes to defund Obamacare have resulted in thousand of frightened calls from people who think they won’t be able to get insurance or they’re losing their insurance. (Surprisingly, nobody’s calling to celebrate the defunding …)

I asked her what calmed people down and she says she tells everyone to think about their high school civics class and remember that laws have to be passed by both houses and signed into law by the president. Without proselytizing at all, everyone immediately realizes what an absurd exercise in futility all this nonsense really is.

When even this guy gets it, you know it’s a loser:

Republican Sen. Rand Paul says President Barack Obama’s health care law probably can’t be defeated or gotten rid of. And he’s suggesting there are few ways and little time for him and other congressional Republicans to stop it.

Speaking to reporters Saturday at a gathering of Michigan Republicans, the presidential prospect said Republicans in Congress could use votes on measures in the House and in the Senate to come up with compromise legislation that could make the law more palatable. Some provisions, Paul said, include removing caps on health savings account contributions or deductibles for health policies.

Still, there is a method to the madness. The late summer blitz with the right wingers getting increasingly hysterical and screaming that the sky is falling will go some way toward convincing a portion of the public that the whole thing is a disaster and that there’s no point in signing up. Which is what they need to do to make it fail. And even if they doesn’t succeed in the long run, all of this will inflict a lot of unnecessary stress as citizens in various states literally have to suffer and die so that these right wingers can make a political point.

I thought I understood the right. But this meltdown over a very tepid health care reform that keeps the system fully in the hands of the private insurance companies just floors me. They should be celebrating their victory. Still, I take heart in the fact that in the end most people are fairly practical in these matters and will find a way to rationalize their acceptance of it even as they rend their garments over it in the abstract. (Tea partiers on disability and Social Security offer the template for such self-delusion.) But in the meantime we are watching behavior so absurdly over-the-top that it’s downright surreal.

I guess we’re just proving our “exceptionalism” once again. How lucky for us.

I’ll just enjoy this, I guess, and wait for the mass hysteria to pass:

Saturday Night at the Movies by Dennis Hartley — Double feature “You will be my Son” and “Good ‘ol Freda”

Saturday Night at the Movies


Our vines have sour grapes

 By Dennis Hartley

I hate you: You Will Be My Son 

You can choose your friends, but you can’t choose your family. C’est la vie. That’s the gist of Gilles Legrand’s You Will Be My Son, an oft-told story of a dysfunctional family; in this case a vat of seething resentment fermenting in the confines of a Bordeaux region heirloom vineyard. I may not know a bottle of Batard Montrachet 1990 magnum from a boxed mountain Chablis in a taste test, but I do know my whines, and this vintage-style melodrama has a fine woodsy bouquet of neuroses; albeit with a rather predictable finish.

The relationship under examination is between father and son. Paul (Niels Arestrup) is a successful winemaker and owner of an estate valued at 30 million Euros. His son Martin (Larant Deustch) lives on the estate with his wife Alice (Anne Marivin) and helps with admin duties. Martin yearns to be given more responsibilities that will groom him for taking over the mantle one day, but the demanding and domineering Paul (a classic narcissistic personality) views Martin as the not-so heir apparent to the family business. Paul mocks his son when Martin reminds him about his college degree in winemaking, telling him you simply must “have the palate” for it, and that he can only learn by doing.

It doesn’t take a rocket scientist to assess that Paul’s daily nitpicking is taking a psychic toll on Martin (“Do something about those nails,” Paul berates him at one point, grabbing his hand, “It’s unbecoming for a man.”). While Martin continues to sublimate his growing anger at his father (much to his wife’s chagrin), all those poisons that lurk in the mud are about to hatch out after Paul’s longtime family friend/estate manager Francois (Patrick Chesnais) reveals that has been diagnosed with pancreatic cancer. When Francois’ son Philippe (Nicolas Bridet) who has a stateside gig as “Coppola’s chief winemaker” comes home to spend time with his dying father, Paul’s mood palpably brightens. It turns out that Philippe, with his winemaking talents, business savvy and personal charm, has all the requisite attributes of Paul’s idealized heir. Paul’s wishful thinking moves beyond the academic when he consults with his lawyer about the plausibility of adopting Philippe as his son. To Paul’s surprise and delight, it turns out to be doable (“It’s a wonder of our civil codes,” his lawyer says, adding a glib caveat: “It’s led to many marvelous family feuds.”)

While it takes a while for the narrative to catch fire (the script, co-written by the director with Delphine de Vigan and Laure Gasparotto could have benefitted from a little tightening), I found myself pulled in enough to develop a morbid curiosity as to which character was going to take the most shrapnel when this emotional powder keg inevitably made its earth-shattering ka-boom. I should warn you that none of the players in this soap opera are particularly likable, so it could be an uphill battle all the way for some viewers. Like some wines, you could store this one in the cellar to uncork when the mood dictates.

Previous posts with related themes:

The Savages

Places she remembers 

By Dennis Hartley

Good Ol’ Freda: Coolest office job ever

No one can complain about a dearth of documentaries released over the years delving into the the public and private lives of John, Paul, George and Ringo, nor claim with a straight face that there has been a severe lack of painstakingly annotated critical analysis regarding their music, album by album, song by song, lyric by lyric…and as an unapologetic Beatle freak, God (as a thing or whatever it is) knows that I’ve seen ’em all. Filmmakers have taken every tack, from cheap, breathless tell-all sensationalism to sober, chin-stroking dissertation about the Mixolydian constructs of “Norwegian Wood”.However, jaded as I am, I have to say I’ve never seen a Beatles doc as touching, unpretentious and utterly charming as Ryan White’s interestingly titled Good Ol’ Freda.

The unlikely star of this breezy study is an unassuming, affable sixty-something Liverpudlian woman named Freda Kelly. At the tender age of 17, she was hired by manager Brian Epstein to do odd jobs around the office while he focused on the then-fledgling career of his young proteges. A year or so later, she became the chief overseer for the band’s fast-growing fan club, embarking on what was to turn into an amazing 11 year career as (for wont of a better job description) the Beatles’ “personal secretary”, from Cavern Club days to the dissolution of the band.

What makes Freda unique amongst the members of the Beatles’ exclusive inner circle (aside from the fact that she remains a virtual unknown to the public at large) is her stalwart loyalty to this day, vis a vis protecting the privacy of her employers; she’s never written a “tell-all” book, nor cashed in on her association with the most famous musical act of all time in any shape or form.

Granted, after appearing in this film, she won’t be so unknown, but she makes it abundantly clear this represents her finally caving in and appearing on camera to say her piece (since we’re all so damn nosy and insistent), then she’ll be done. And she does tell some tales; although none of them are “out of school”, as they say. But that’s okay, because she is so effervescent and down-to-earth that its like having her over for tea to peruse her scrapbooks and enjoy a pleasant chat about times that were at once innocent, hopeful and imbued with the fleeting exuberance of youth. OK, she had me blubbering like Boehner by the end..happy now? You could do worse with 90 minutes of your time.

Note: Good Ol’ Freda is in limited theatrical release and on PPV (check local listings!).

Previous posts with related themes:

I Saw a Film Today, pt. 1
I Saw a Film Today, pt. 2
I Saw a Film Today, pt. 3

Saturday Night at the Movies review archives

Right wing whiplash

Right wing whiplash


by digby

It’s a confusing time for wingnuts.  And nobody tracks them the way Edroso does:

Last week we reported that rightbloggers were enraged the tyrant Obama was contemplating war with Syria. This week we can report that rightbloggers are enraged that the pussy Obama is avoiding war with Syria… 

The Administration’s late flip from saber-rattling to a deal with Russia to remove Syria’s chemical weapons seems to have caught rightbloggers off-guard. At least when they were pretending to be peaceniks, they could follow the familiar stylesheets of previous anti-war movements. (No blood for O!) 

When the switch came, they could hardly tell readers that they’d actually wanted war all along. So they complained about the way Obama got out of war: By coddling Assad and, especially, by making Valdimir Putin look good. 

Two weeks back, Ace of Spades gave us “14 Reasons to Not Bomb Syria” and decreed “we cannot go to war under this clownshow’s disaster-movie leadership.” Comes the Russian deal and — record scratch! — Ace of Spades sneered at “Obama, the president that people love because he makes such efforts to avoid being decisive,” then became enraged at “the world’s most awkward weakling, Bassar al-Assad, openly taunting the US,” and then, get this, told us, “I actually would like, in my heart of hearts, to hit Bassar al-Assad (a longtime sponsor of terrorism, financier and logistics officer for Hezb’allah, and useful Iranian client/minion state)… I wish I could support this action. I can’t.” Spades said this was because he very recently came to believe that Al Qaeda is mixed up with the rebels, though readers not born yesterday may draw a different conclusion.

No kidding. What with Democrats contemplating war and them changing their minds and all, some of them are so confused they think we’ve gone back in a time capsule to 1962 and they think Vladimir Putin is Nikita Kruschev.

They love him, they hate him, they love him they hate him:

“Having eaten Obama’s lunch, Putin wanted to send a message to us in Obama’s favorite newspaper,” cheered Scott Johnson at Power Line. “…Putin has eaten Obama’s lunch. Now he wants to rub it in… He’s taking his shirt off and baring his chest in a manner that is calculated to make an impression outside Russia.”

Johnson wasn’t the only one fixated on Obama’s lunch and Putin’s naked chest. “Daddy Putin just spanked Obama,” declared Curt at Flopping Aces. “This whole debacle has been embarrassment for America… Just embarrassing… And now what is Daddy Putin up to?… Obama, upstaged and outsmarted at every turn.” What a daddy!

On Fox, Ralph “Blood ‘n’ Guts” Peters purred, “I don’t like Putin, but I respect that guy. He is tough. He delivers what he says he’ll deliver… He presents himself as a real He-Man… Our president talks tough, but in the clinch he’s gutless.”

It’s so hard to know who they’re supposed to hate these days, isn’t it?

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