Why the austerity fraud matters

http://weeklysift.com/2013/04/22/why-the-austerity-fraud-matters/

But this week a controversy broke out in economics, and it actually deserves your attention. A paper that has had a major influence on public policy around the world turns out to be wrong. And not just wrong in a subtle way that only geniuses can see, or even wrong in an everybody’s-human way that you look at and say, “Oh yeah, I’ve done that.” This one was wrong in three different ways that make you (or at least me) say, “That can’t be an accident.”

~ Doug Muder

Really, you should read this. Foundations have moved.

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What if secretaries became programmers

http://weeklysift.com/2012/05/14/77-cents-part-ii-what-if-secretaries-became-programmers/

But why do women make less? Is it for reasons we can all live with, or is the pay gap an injustice that needs fixing? Several reasons are frequently offered, together with explanations why we can live with those reasons. (Never forget that those are two separate conversations. Even if the whole pay gap could be boiled down to something as simple as “Girls don’t like math”, we’d still need to discuss whether that’s a problem we can or should fix.)

~ Doug Muder

VERY interesting gender/salary math.

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Debt: This time is different

http://ourfiniteworld.com/2014/07/07/debt-eight-reasons-this-time-is-different/

Many seem to believe that if we worked our way out of debt problems in the past, we can do the same thing again. The same assets may have new owners, but everything will work together in the long run. Businesses will continue operating, and people will continue to have jobs. We may have to adjust monetary policy, or perhaps regulation of financial institutions, but that is about all.

I think this is where the story goes wrong. The situation we have now is very different, and far worse, than what happened in the past.

~ Gail Tverberg

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You don’t have a job, you have a hobby

http://weeklysift.com/2012/04/16/rich-people-dont-have-jobs/

That’s the only test that counts. It’s not how hard you work, it’s what happens if you stop. If quitting means real hardship for you or your family, you have a job. If you keep at it even though you could spend the rest of your life skipping rocks at your house by the lake, you have a hobby.

I’ve got nothing against hobbies. The Weekly Sift is a hobby. One way to describe the Marxist vision of Utopia is that we’d all be hobbyists, and the world’s work would get done by people who just wanted the satisfaction of doing it. (That vision even works sometimes: Wikipedia, open source software, and so on.)

~ Doug Muder

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Where the jobs are

http://weeklysift.com/2012/01/30/where-the-jobs-are-and-why/

While America continues to create market-dominating companies like Apple or Google, the number of American jobs they provide doesn’t compare with market-dominating American companies of the past like General Electric or Ford.

The reason why is simple: While much of the design and management happens in America, most of the physical products are manufactured in low-wage economies like China. Those factories that remain in America are highly automated, so that our manufacturing employment plummets even as our manufacturing output continues to rise. America still makes a lot of stuff, it’s just not made by people.

~ Doug Muder

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Oil limits and the economy

http://ourfiniteworld.com/2014/03/21/oil-limits-and-the-economy-one-story-not-two/

While the press treats these issues as separate stories, they are in fact very closely connected, related to the fact that we are reaching limits in many different directions simultaneously. The economy is the coordinating system that ties together all available resources, as well as the users of these resources. It does this almost magically, by figuring out what prices are needed to keep the system in balance—how much materials of which types are needed, given what consumers can afford to pay.

~ Gail Tverberg

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Energy return on energy invested

http://ourfiniteworld.com/2013/12/06/diminishing-returns-energy-return-on-energy-invested-and-collapse/

Eventually, the civilization hit a period of stagflation, typically lasting 50 or 60 years, as the population hit the carrying capacity of the land, and as additional workers did not add proportionately more output. When this happened, the wages of common workers tended to stagnate or decrease, resulting in increased wage disparity. The price of food tended to spike. To counter these problems, the amount of government services rose, as did the amount of debt.

~ Gail Tverberg

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Oil limits

http://ourfiniteworld.com/2013/08/02/oil-limits-reduce-gdp-growth-unwinding-qe-a-problem/

This model “works” fairly well, as long as the economy is growing fast enough–population continues to grow and resource extraction continues to grow as planned. In a finite world, we know that this model cannot work forever. At some point, we can expect to start reaching limits.

What do these limits look like? I would argue that in the case of resource extraction, these limits look like increasingly high cost of extraction.

~ Gail Tverberg

You should also read “Quantitative Easing (QE)” (the first three, short paragraphs on WikiPedia summarize it neatly.)

My opinion: We need to start seriously talking about a STEADY STATE ECONOMY. What would that look like? How would it work? How do we get to that? Seriously. We simply CANNOT have a growing and expanding economy forever on a finite planet with finite room and finite resources. What part of “finite” don’t you understand?

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