13 Dec 2012

Potpourri

Market Monetarism, MMT, Nick Rowe, Potpourri, Scott Sumner, Shameless Self-Promotion 55 Comments

==> After reading my scathing critique, David Frum will wish he had added another axis of evil.

==> My interview on MMT matters. I am tough, but I am fair. (?)

==> Jerry O’Driscoll catches something that I noticed too: The Fed’s announcement seems to turn a ceiling into a floor. (HT2 the eagle-eyed von Pepe.)

==> David Beckworth follows my lead and tries to pick a fight with Krugman.

==> I said I wouldn’t post any more on the Cantillon Effects stuff. Let me just say, Nick and Scott still think I’m an idiot. (I dispute this in the comments of their respective posts.) And here’s a good summary by JP Koning.

55 Responses to “Potpourri”

  1. guest says:

    Three resources against the global warming hype:

    Junk Science
    http://www.junkscience.com

    Climate Depot
    http://www.climatedepot.com

    Watts Up With That?
    http://wattsupwiththat.com/

    The concept of “global warming” is meaningless: it’s an aggregate of REGIONAL temperatures, which change all the time.

    Nobody denies this, but the implication of that is that it’s the regional data that matters, and not the aggregate data. If regional temperatures go DOWN after a cycle of seasons … ANYWHERE … then that disproves “global warming”, since “global warming” wasn’t able to cause every area’s temperature to rise.

    It’s not global if it doesn’t get hotter everywhere at the same time.

    • Matt Tanous says:

      As a “denier” of global warming, I hate to do this… but you are wrong. There can be a global trend that temperatures would be higher than they otherwise would have been. No one is claiming that CO2 and greenhouse warming is the ONLY factor in temperatures.

      • Ken B says:

        Yes. And logically GW can cause *local* cooling. Say GW effects moved the gulfstream. That might cool the UK.

        I’m a skeptic re catastrophic AGW btw.

        • guest says:

          Yes. And logically GW can cause *local* cooling.

          But see, thats the thing: The measure of GLOBAL warming is an AGGREGATE of regional temperatures; “Global warming” can’t CAUSE anything.

          Global readings are COMPRISED of regional temperatures.

          You can say that one region affects another, which is fine. But the aggregate numbers are meaningless.

          • Ken B says:

            Oh this is silly. The *warming effects of Co2* — which is what “Global Warming” means even if grammatically it should not — if they are big enough, can cause the current to change location, and so can cause a cooling in regions the current previously warmed.

            • guest says:

              … can cause the current to change location, and so can cause a cooling in regions the current previously warmed.

              In climate denier speak, this is called self-regulating climate.

              Besides, as Bill Nye says, it’s not about the temperature, anyway:

              Oops–Bill Nye blows the entire warmist argument on national TV with six words
              http://www.climatedepot.com/a/18702/OopsBill-Nye-blows-the-entire-warmist-argument-on-national-TV-with-six-words

              After Morano says ‘every proposal ever done including the UN Kyoto protocol would not impact the temperatures assuming you buy into their science’, Nye actually says ‘We’re not talking about the temperature’

            • Matt Tanous says:

              The sad thing is, it isn’t like there is no evidence against catastropic AGW. Like this study, for instance: http://www.cfact.org/pdf/ClimateDepot-ExtremeWeatherReport2012.pdf

              So why turn to nonsense about how it is meaningless is the average temperature of the Earth goes up, or try to insinuate that this is the only predicted effect of the theories behind claims of AGW?

              • guest says:

                Because it’s the “Hockey Stick” graph that these people used to try to scare everyone into allowing a global government to control their lives.

                A man-made global rise in temperature was the “settled science” claim, remember?

                That’s what the “Hockey Stick” supposedly proved.

                We were going to destroy ourselves, it was said, if we didn’t stop using oil.

                This is why they conveniently call it “Climate Change”, now, because people are seeing COLDER weather phenomena in some places.

                NOW they have to get you to believe that global warming causes global cooling.

                It’s not about concern for the “global temperature” (whatever that means), anyway. It’s about controlling your economy; Making you more pliable by making it harder to live.

                And, really, I think it’s quite sensible to write the whole “global warming” hysteria off as a bunch of hot air based SOLELY on the fact that it’s a LOGICALLY meaningless concept, given that the WEATHER changes all the time.

                And yes, I know that weather is different than climate; Climate is yet another aggregate of weather, except over time – therefore ALSO a meaningless concept.

                What is “normal” climate, when the weather data, from which climate data is derived, can change all the time?

                All I needed was basic logic to figure this out.

                Global temperature is an aggregate of regional climate data, so each region’s climate must have something in common in order for the “global temperature” to mean anything.

                Climate data is aggregated regional weather data over time, so the region’s weather data must have something in common in order for “climate” to mean anything.

                So ultimately the concept of “global warming” must rely on something that is common for every region on earth, otherwise it’s meaningless to aggregate the data.

                Again, though, nobody disagrees that weather changes all the time. And certainly not uniformly.

                Therefore, the concept of global warming is meaningless.

                Not too long after hysteria over global warming reached its peak in the U.S (around the time of ClimateGate, I believe), it was snowing in unusual places in January of 2011:

                Snow extends to cover 69% of lower 48 states; 49 of all 50 states have snow
                http://www.examiner.com/article/snow-extends-to-cover-69-of-lower-48-states-49-of-all-50-states-have-snow

                Just do a search for “snow 48 states”.

        • guest says:

          Check out some of the quotes on this page:

          In their own words – the truth about their real motivations
          http://redneckusa.wordpress.com/2012/04/16/in-their-own-words-the-truth-about-their-real-motivations/

          • IPCC official Ottmar Edenhofer in November 2010 admitted “one has to free oneself from the illusion that international climate policy is environmental policy.” Instead, climate change policy is about how “we redistribute de facto the world’s wealth…”

          That particular quote was recent, and was reported on TheBlaze:

          U.N. Official Admits: We Redistribute World’s Wealth by Climate Policy
          http://www.theblaze.com/stories/u-n-official-admits-we-redistribute-worlds-wealth-by-climate-policy/

        • John p says:

          From Nigel Lawson’s An Appeal To Reason :

          As the eminent oceanographer Professor Carl Wunsch has pointed out, the Gulf Stream is largely a surface current, and thus a wind- driven phenomenon, and ‘As long as the sun heats the Earth and the Earth spins, so that we have winds, there will be a Gulf Stream.’

          ‘…..it is now widely believed that Gulf Stream plays only a minor part in bringing about the mildness of the western European climate, and that a more important factor is what the scientists call ‘atmospheric heat transport’, or in plain language, warm air currents (from the prevailing south- westerly wind).

  2. Matt Tanous says:

    “David Beckworth follows my lead and tries to pick a fight with Krugman.”

    Still focused on the NGDP, I see. I hear Weimar Germany had a really high rate of NGDP growth.

  3. Ken B says:

    I expect Krugman will want to debate Beckwith.

    Sorry, sorry, couldn’t resist. Beathe normally.

    The IER post was Frum-dillie-icious.

    • Ken B says:

      That would make a great new Baskin Robbins flavor: Frum-dillie-icious! “it tastes like a puffed up balloon bursting”

    • Matt Tanous says:

      “History offers many natural experiments in macroeconomics”

      Unless they refute Krugman’s theories, in which case, “this time is different”.

  4. Teqzilla says:

    mmmmmm loved reading the Frum critique. That preening dilettante cant get slapped around enough.

  5. David R. Henderson says:

    Bob, Excellent piece on Frum. One criticism, though. You write:
    The damage to the economy would be even greater if, as Frum suggests, some of the new carbon tax is not revenue-neutral but instead is spent (i.e. used to reduce the deficit).
    How does spending the money reduce the deficit?

  6. Bob Roddis says:

    Prof. Murphy’s takedown of Mosler’s 7 Purposefully Dishonest Frauds was excellent. I’ve always thought the MMT line regarding “new net financial assets” was the most brilliant B.S. since “the paradox of thrift”. They con-VEEN-niently omit the fact that the obligor of those “new net financial assets” is also “the private sector”. Amazingly brilliant B.S. by those MMTers.

    Also, MMT Queen Stephanie Kelton was on “Capital Account” where she amazingly assumes the truth of every Keynesian and central planning myth and then implicitly proves my claim that no MMTer has the slightest familiarity with even “the problem of knowledge in society” . Benevolent and omniscient central planners can solve all problems in society because they are not “revenue constrained”. Except Queen Stephanie admitted that at present, the US government CANNOT just spend out of thin air but would require new legislation for that purpose. Further, she admitted that there is no place on earth that has ever practiced MMT.

    But, of course, MMT explains how a modern monetary economy really works.

    http://mikenormaneconomics.blogspot.com/2012/12/stephanie-kelton-on-modern-monetary.html

  7. Bob Roddis says:

    If you follow the link from Koning’s page to David Glasner, you will find this insight among the voluminous verbiage:

    Merely to point out that such effects exist and redound to the benefits of some lucky individuals would have been considered a rather trivial and pointless exercise by Hayek.

    http://uneasymoney.com/2012/12/06/those-dreaded-cantillon-effects/

    Hmmm. 94% of the population does not even know that inflation isn’t a mysterious force of nature and 98% of the remainder are statists who deny the very existence of Cantillon Effects. The rest think it’s just peachy keen (Kuehn??) for the elite to rob society blind this way.

    What a trivial topic and what a pointless exercise to point this out. Sheldon Richman should be embarrassed.

  8. Bob Roddis says:

    One MMT point not covered on either the “Radio Free Market” or Capital Account interviews was where the stuff is going to painlessly come from to satisfy the $220 trillion in unfunded US obligations.

    Answer: Money dilution will solve the problem of idle workers and resources who will then be able to painlessly increase production to satisfy those obligations. Anybody who doesn’t know that is stupid.

  9. Bob Roddis says:

    On the Mike Norman site, I linked to Bob Murphy’s evisceration of Mosler’s Seven Purposeful Frauds of MMT. A few hours later, the entire Norman post plus comments were deleted.

    http://www.flickr.com/photos/bob_roddis/8274322065/in/photostream

  10. Lord Keynes says:

    “My interview on MMT matters. I am tough, but I am fair. (?)”

    I am not sure “tough” is really the right word, frankly.

    How can you say it is “tough” when we hear again and again that MMT is technically correct? I note how you more or less (with caveats) agree with the MMT view of trade deficits.

    http://socialdemocracy21stcentury.blogspot.com/2012/12/robert-murphy-on-mmt-unimpressive.html

    • Bob Roddis says:

      Bob Murphy is merely unimpressive. On the other hand, I’m the Vulgar Internet Austrian.

      http://socialdemocracy21stcentury.blogspot.com/2012/12/vulgar-austrians-economic-calculation.html

    • Bob Roddis says:

      That Randy Wray is one smart dude. I love his debating style:

      Q: Austrians use a bait and switch operation—denying that what we have is capitalism and comparing it to some sort of ideal utopian capitalism.

      Wray: Agreed. That makes it easy to blame all of real world capitalism’s problems on its deviation from utopia. It is fundamentally an anti-scientific approach. Let’s analyze what we have and try to make it better. We cannot have utopia. We’re dealing with human society, after all.

      http://bobroddis.blogspot.com/2012/03/new-blog-feature-dumbest-mmt-statement.html

      It’s like trying to nail Jello to the wall. Amazing bunch of folks.

      • Lord Keynes says:

        “Wray: Agreed. That makes it easy to blame all of real world capitalism’s problems on its deviation from utopia. It is fundamentally an anti-scientific approach. Let’s analyze what we have and try to make it better. We cannot have utopia. We’re dealing with human society, after all”

        I suppose the truth hurts, huh, bob?

        • Major_Freedom says:

          Speaking of unscientific theories, Keynesians blame all of real world Keynesian infested problems on its deviations from Keynesian Utopia. Recession? Lack of Keynesian utopia schemes. Thus, enact more real world Keynesian schemes, but still recession, therefore the problem is not enough real world Keynesian schemes.

          Truth hurts.

        • guest says:

          If one knows what is “better”, doesn’t he also believe that things as they are are a deviation from utopia; Or at least a deviation from the best that could be?

          It’s the same form of argument.

          “Better” is toward something. Toward what?

          See what I mean?

          • Major_Freedom says:

            “Utopia” is reserved for those “better” alternatives that are something other than steps toward socialism.

      • Bob Roddis says:

        Just as LK compulsively obfuscates regarding the concept of economic calculation, he must do the same regarding the fundamental concept of the non-aggression principle. We do not have to reinvent the wheel regarding private property and the NAP. Everyone already understands the concepts of “my house”, “my car”, “my bank account” and “my body”. We already have an established system of the English common law which protects persons and property from injury by others. All that Rothbardian “anacho-capitalism” adds to this pre-existing system is to insist upon a more rigorous application of these pre-existing and well understood principles with an elimination of multiple exceptions to the basic rules. I suppose that expecting there to never be any violation of these rules might be considered “utopian” (but so what?). However, simply spelling out what those strict rules ought to be differentiating them from the current “mixed” system is not “utopian”.

        It is essential for “progressives” that they keep average people from understanding the difference between laissez faire and crony capitalism or from understanding that the “robber barons” employed “progressive” regulation to attain their ends which they could not attain via laissez faire. It is not the system of private property and contracts that causes our problems but the abandonment of those principles. Liars and frauds like Wray and LK must desperately obscure those essential differences so that a popular understanding of the Austrian/libertarian analysis is suppressed. Thus, what happened when the Fed funded WWI must be called “capitalism”. The Great Depression was “capitalism”. The funny money induced housing bubble was “capitalism”. And any rigorous analysis showing that the problems were caused by an abandonment of free market principles must be smeared as “utopian”.

        Liars and frauds.

        • Lord Keynes says:

          You’re just proven Wray’s point perfectly in this comment.

          Was 19th century America, say, 1866-1913 (before the Fed) capitalist or not?

          • Bob Roddis says:

            In the context of differentiating between different levels of interventionism, the term “capitalism” becomes purposefully confusing and meaningless. Which is just as you intend for your nefarious and dishonest purposes.

            What’s happened here is that you’ve proven my point.

            • Lord Keynes says:

              Wray:

              Q: Austrians use a bait and switch operation—denying that what we have is capitalism and comparing it to some sort of ideal utopian capitalism.

              Wray: Agreed. That makes it easy to blame all of real world capitalism’s problems on its deviation from utopia.

              Roddis:
              “In the context of differentiating between different levels of interventionism, the term “capitalism” becomes purposefully confusing and meaningless.”

              In other words, roddis denies we have capitalism. Wray vindicated.

              QED.

            • Lord Keynes says:

              Also, you appear to imply that America from 1866-1913 was not even capitalist either.

    • martin says:

      How can you say it is “tough” when we hear again and again that MMT is technically correct?

      Well, the statement “falling out of a tenth story window won’t kill you” is also technically correct – it won’t kill you, hitting the pavement will.

  11. joeftansey says:

    Why do you spend so much time arguing against the global warming crowd when libertarians should be against pollution anyway? I’m sure you’re familiar with the statistics on how smog causes health problems for people in tightly packed cities… among other things.

    And so what if the consequences of global warming are a net “benefit”? It’s still a violation of property rights if we all pollute and change the temperature in certain countries.

    • guest says:

      Why do you spend so much time arguing against the global warming crowd when libertarians should be against pollution anyway?

      Because the problems of pollution isn’t due to a lack of regulations, but to private property rights violations – private property being the only place where the issue of pollution would matter.

      In fact, it’s BECAUSE of regulations that pollution of private property is the problem it is:

      Classic Ron Paul – 1988 Campaign Interview (part 2)
      http://www.youtube.com/watch?v=Tpp5XOJPGlM#t=3m50s

      Last point we’d like to touch on is the environment.

      If you’re opposed to less government, how would you enforce environmental restrictions upon companies polluting the environment?

      (The interviewer botched his question, but was trying to ask Ron Paul about his support for less government.)

      Defending the Undefendable (Chapter 26: The Stripminer) by Walter Block
      http://www.youtube.com/watch?v=15Xskw_bGf8

      • joeftansey says:

        “Because the problems of pollution isn’t due to a lack of regulations, but to private property rights violations – private property being the only place where the issue of pollution would matter.”

        And regulations that seriously curtailed emissions would protect property rights.

        “Classic Ron Paul – 1988 Campaign Interview (part 2)”

        Oh yeah I didn’t know who Ron Paul was, or Walter Block. /Sarcasm. In fact it is because I am familiar with their arguments that I raise this issue – Why oppose global warming legislation so heavily while we (should) support massive reductions in pollution?

    • Joseph Fetz says:

      I’m pretty sure that most libertarians are against pollution, and that they do indeed see the problems associated with pollution and property rights. However, I am still not seeing what that has to do with the implications that come with the global warming theory. If you can reasonably prove that one person’s CO2 did direct harm to you or your property, fine. However, that certainly is not the aims of those associated with the AGW set. Their aim is to increase government, not only in size and scope, but also in territorial jurisdiction. Once the theory of AGW is accepted as true, the only state solution is that of a world order of governance.

      • Richie says:

        CO2 is not a pollutant. Plant life thrives on it.

        • Joseph Fetz says:

          I never said that it was.

          • Richie says:

            I apologize. I should have expanded on my comment. When you wrote:

            If you can reasonably prove that one person’s CO2 did direct harm to you or your property, fine.

            my first thought was about the loony environmentalists that claim CO2 is “polluting” the atmosphere. My comment was not directed at you, but at joeftansey. Sorry about that.

            • joeftansey says:

              It is possible for plants to breath pollutants. Plants can process all sorts of crap that would be bad if you ate it.

              But I never said CO2. You’re projecting. You could have easily inferred that I was talking about one of the toxic-pollutants.. heavy metals, nitrous oxides, bla bla bla.

              But no no no I’m a crazy environmentalist loon who doesn’t know how to use wikipedia.

          • Richie says:

            Addendum: I am not claiming that joeftantsey is a looney environmentalist; just that what he wrote is the language used by them.

      • Bob Roddis says:

        Keynesian policies plus freeway building and eminent domain induce sprawl which causes the dreaded Global Warming. Like most horrible things in the world, it’s the Keynesians’ or “progressives’” fault.

      • joeftansey says:

        “However, that certainly is not the aims of those associated with the AGW set. Their aim is to increase government, not only in size and scope, but also in territorial jurisdiction.”

        Right. The state is co-opting the environmental movement to try and expand itself. But rather than promote the libertarian solution, we’d rather just niggle that the watermelons are screwing up some of their arguments. If they were arguing on the basis of pollution and public health (80′s style), they’d have an incontrovertible knockdown case. What then?

        “Once the theory of AGW is accepted as true, the only state solution is that of a world order of governance.”

        It’s in principle possible for it to be true. What then?

        Bob even sometimes concedes that our emissions might have an impact on global temperature. Even if the “net” effect is “positive”, it’s still a violation of property rights for us to screw with other peoples’ temperatures.

        No matter which way you slice it, the “libertarian” reaction to AGW issues is perplexing. We should be favoring massive reductions in pollutants for many reasons. But then when the government looks like it’s getting serious about cutting emissions, we have an aneurysm –> YOU MESSED UP YOUR SCIENCCCCEE

        • Ken B says:

          ” We should be favoring massive reductions in pollutants for many reasons.”

          But the AGW debate is mostly about reducing CO2.

          IMO pollutant is like poison: it’s the dose that matters. Or weed: it’s a weed if you don’t want it. The AGW argument is that CO2 is being released in such quantities that it has become a pollutant and a problem.

          • joeftansey says:

            We should have a much lower tolerance threshold than the AGW people. They think it’ll be a problem if it causes more hurricanes and displaces millions of people. We should think it’s a problem if it messes with a single piece of private property.

            It probably does.

            • Ken B says:

              Who is ‘we’?

            • joeftansey says:

              Libertarians.

              • Ken B says:

                That’s what confused me. I’m not one, just a fellow traveller.

              • Major_Freedom says:

                I’m not one, just a fellow traveller.

                Don’t you mean a heavy caboose?

              • Ken B says:

                Maybe. You’re the expert on being a drag.

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