Yes we can !!!

[eumaas]

Or be smart enough to stockpile during summer and fall (so to speak) for the inevitable winter, instead of acting like the boom times will never end and then starving during the downturns. There's Chinese myth or story of an emperor who commissioned to have a statue built in the centre of the capital, with words that would always be true. After some time, the statue was erected with the legend, "This, too, shall pass." Good times aren't forever nor are bad times, but if you keep these things in mind you can utilize the former to better ride out the latter.

I'm not sure an economy is capable of building that kind of surplus.

If the problem of reduced services is due to periodic downturns in the economy, governments and citizens aren't capable of preparing for such events through savings, thereby allowing services to continue?

As far as citizens' saving, that's disincentivized by high taxation. As far as gov't saving, you run into a problem. Let's say for every $10, the gov't takes $5, and that's exactly sufficient to fund the services. Well, that high a rate of taxation is a disincentive to investment and so growth is going to slow, which means the pot from which the gov't draws its taxes will shrink. So the gov't decides to take an extra $.50 to save. By taking that $.50 per every $10, that's $.50 per $10 less to invest, save, or consume by the taxpayer. That means you're actually disincentivizing even more. You're basically trying to solve the problem of high taxation by taxing even more.

I'll be the first to admit that my understanding of economics is rudimentary, but the scenario you describe makes it seem that no state could ever provide any services because any money taken from the citizens weakens investment and, by implication, the economy. That public investments are a black hole. Which seems a lot like the stuff we've grown up with. Your scenario also seems like it doesn't take into account that during boom times ("summer") the govt would take in more thru taxation at the same rate than in, say, spring or fall. If, in fact, more is held in savings for use in the winter, why wouldn't it be possible to lower the tax rate in those times and draw from the savings?

That's where the balance comes in. The forms of taxation and their rate (whether low or high) have economic effects. The key is finding a good balance. The above description was just a static snapshot of what kinds of difficulties are involved. The idea behind supply-side economics (which doesn't seem to work) would be that with reduced taxation, investment would increase thus causing growth thus causing one of your summers, and that would mean that even though the tax rate was lowered, the amount of revenue collected would increase above that collected at the higher tax rate due to the growth in the economy. Unfortunately, it didn't work. The trick is finding a form (flat, progressive, whichever) and rate of taxation that 1. doesn't discourage business to the extent that the economy stagnates, 2. is more than sufficient to cover all the costs of gov't and its services, so that in consequence 3. the gov't has a surplus to save. If that's not tricky enough for you, however, sometimes running a deficit is actually stimulative. This is why politicians are always arguing about taxation and fiscal policy. Add in the responsive inefficacy of large entities (see Carson's organizational theory manuscript for this or his predecessors in the Austrian school), and basically you've got a man on a unicycle trying to jungle a dozen things while careening down the side of a rocky hill. In fact, I'm pretty sure such a sight is what inspired the nihilistic little fucker who came up with this whole game. Essentially, it's incredibly fucking complicated.

[eumaas]

P.S.: add in regulations/regulatory institutions and a central bank and it's even MORE complicated because those things distort market functions and make it harder to predict what the results of certain actions and policies will be.

[Dr. Medulla]

I'll be the first to admit that my understanding of economics is rudimentary, but the scenario you describe makes it seem that no state could ever provide any services because any money taken from the citizens weakens investment and, by implication, the economy. That public investments are a black hole. Which seems a lot like the stuff we've grown up with. Your scenario also seems like it doesn't take into account that during boom times ("summer") the govt would take in more thru taxation at the same rate than in, say, spring or fall. If, in fact, more is held in savings for use in the winter, why wouldn't it be possible to lower the tax rate in those times and draw from the savings?

That's where the balance comes in. The forms of taxation and their rate (whether low or high) have economic effects. The key is finding a good balance. The above description was just a static snapshot of what kinds of difficulties are involved. The idea behind supply-side economics (which doesn't seem to work) would be that with reduced taxation, investment would increase thus causing growth thus causing one of your summers, and that would mean that even though the tax rate was lowered, the amount of revenue collected would increase above that collected at the higher tax rate due to the growth in the economy. Unfortunately, it didn't work. The trick is finding a form (flat, progressive, whichever) and rate of taxation that 1. doesn't discourage business to the extent that the economy stagnates, 2. is more than sufficient to cover all the costs of gov't and its services, so that in consequence 3. the gov't has a surplus to save. If that's not tricky enough for you, however, sometimes running a deficit is actually stimulative. This is why politicians are always arguing about taxation and fiscal policy. Add in the responsive inefficacy of large entities (see Carson's organizational theory manuscript for this or his predecessors in the Austrian school), and basically you've got a man on a unicycle trying to jungle a dozen things while careening down the side of a rocky hill. In fact, I'm pretty sure such a sight is what inspired the nihilistic little fucker who came up with this whole game. Essentially, it's incredibly fucking complicated.

Just pruning the quote tree some …

All of which makes sense, and I appreciate the difficulties inherent. Plus it doesn't take into account unknown disasters—what happens if a volcano in Indonesia erupts and sends enough ash into the atmosphere to fuck with crops worldwide for a season or two? So, yeah, it's tough. But is it doable? I think so. Hell, you must think so if you believe it's possible that people can live without a state whatsoever. We are, I think, sharing the same space in that it's a matter of people changing their attitudes towards social relations and personal expectations for a just and good life.

[Wolter]

You might want to reprune. The format's off.

[Dr. Medulla]

You might want to reprune. The format's off.

Quiet from the peanut gallery!

[Wolter]

You might want to reprune. The format's off.

Quiet from the peanut gallery!

Just wanted to make sure dignity and sensible discussion prevailed.











Asshat.


Oh, and nice signature quote. I was just remembering that sketch yesterday when I listend to David Cross's first album.

[eumaas]

All of which makes sense, and I appreciate the difficulties inherent. Plus it doesn't take into account unknown disasters—what happens if a volcano in Indonesia erupts and sends enough ash into the atmosphere to fuck with crops worldwide for a season or two? So, yeah, it's tough. But is it doable? I think so.

Gov'ts do it all the time, so yes, it's possible, but it isn't easy. Socdem has particular difficulties just due to the extent of its services and how it has to fund them, though.

Hell, you must think so if you believe it's possible that people can live without a state whatsoever. We are, I think, sharing the same space in that it's a matter of people changing their attitudes towards social relations and personal expectations for a just and good life.

Actually, I think it's even easier to do the less of a state you have. The virtue of the free market (and anarchy is in a sense subsuming everything into the market--though not everything into the cash nexus, which is just a part of the market) is that of spontaneous order and dispersed knowledge. Concentration of power runs into knowledge problems. Basically, there's a spectrum from a free economy (and polity most likely) to a planned economy (and by necessity the polity as well), neither of which have been realized in absolute form. Mixed economies avoid the absolute knowledge/calculation disaster of the planned economy, but agents in a mixed economy lose predictive power since the market effects are distorted by intervention. I'm not making a value judgment here, it's just that information exchange is distorted by definition in a mixed economy. But markets are often subordinated to certain values--whether it be greed (see my signature), warfare/nationalism, or the cradle to grave security of socdem. The trick (if you value the state) is finding a sustainable way of maintaining such subordination.

[Dr. Medulla]

You might want to reprune. The format's off.

Quiet from the peanut gallery!

Just wanted to make sure dignity and sensible discussion prevailed.

Asshat.

If I want dignity and sense to prevail, I'll keep my yap shut.

[Dr. Medulla]

All of which makes sense, and I appreciate the difficulties inherent. Plus it doesn't take into account unknown disasters—what happens if a volcano in Indonesia erupts and sends enough ash into the atmosphere to fuck with crops worldwide for a season or two? So, yeah, it's tough. But is it doable? I think so.

Gov'ts do it all the time, so yes, it's possible, but it isn't easy. Socdem has particular difficulties just due to the extent of its services and how it has to fund them, though.

Hell, you must think so if you believe it's possible that people can live without a state whatsoever. We are, I think, sharing the same space in that it's a matter of people changing their attitudes towards social relations and personal expectations for a just and good life.

Actually, I think it's even easier to do the less of a state you have. The virtue of the free market (and anarchy is in a sense subsuming everything into the market--though not everything into the cash nexus, which is just a part of the market) is that of spontaneous order and dispersed knowledge. Concentration of power runs into knowledge problems. Basically, there's a spectrum from a free economy (and polity most likely) to a planned economy (and by necessity the polity as well), neither of which have been realized in absolute form. Mixed economies avoid the absolute knowledge/calculation disaster of the planned economy, but agents in a mixed economy lose predictive power since the market effects are distorted by intervention. I'm not making a value judgment here, it's just that information exchange is distorted by definition in a mixed economy. But markets are often subordinated to certain values--whether it be greed (see my signature), warfare/nationalism, or the cradle to grave security of socdem. The trick (if you value the state) is finding a sustainable way of maintaining such subordination.

Oh yeah, see my signature!

Sorry, I don't mean to blow you off, but I've been having a bad head day—a bad head week, really (you know what I'm talking about)—and I'm losing my capacity to concentrate and work things through. I need to take a break from this stuff. If a seizure is coming on, it looks like it'll be a good one.

[Dr. Medulla]

Oh, and nice signature quote. I was just remembering that sketch yesterday when I listend to David Cross's first album.

I figured you were probably the only one to get the reference. Tom Kenny as a Brooklyn Lincoln is one of the funniest things I've ever seen.

[eumaas]

Oh yeah, see my signature!

Sorry, I don't mean to blow you off, but I've been having a bad head day—a bad head week, really (you know what I'm talking about)—and I'm losing my capacity to concentrate and work things through. I need to take a break from this stuff. If a seizure is coming on, it looks like it'll be a good one.

No worries. Good luck on the doozy. It's coming. Maybe you should try medication again. I'm hella more alert now. That said, I didn't see any evidence of head issues in your statements--you've come up with very perceptive points.

As far as the topic, it's not even a debate, really. I just want to get across just how fucking intricate and difficult economic policy is. That's also why they say economics was invented to make astrology look respectable. Your average econ dept is more interested in pumping out a little policymaker for a think tank or party, whatever, than a genuine scientist or philosopher. And the divisions between the schools are very deep. Often it's not that a Keynesian and an Austrian, or a Marxian and a Chicagoan disagree so much as they frame it so differently that there's no common ground from which to start. I was originally going to go into economics as my field before I realized it's geared towards pumping out Keynesians and Chicagoans who act as viziers for politicians and apologists for big business. No thanks. I've always put my lot with the radical heterodoxy, whether post-Keynesian, neo-Marxian, institutional, or Austrian. These days I lean more heavily on Austrian. Mainstream economics strikes me as duplicitous--they use models based in free markets to talk about decidedly unfree markets and produce policy. Of course, their policies aren't really based in these models as they know full well such things aren't accurate, but they still use those models to justify policies. It's pretty slimy.

[Dr. Medulla]

Oh yeah, see my signature!

Sorry, I don't mean to blow you off, but I've been having a bad head day—a bad head week, really (you know what I'm talking about)—and I'm losing my capacity to concentrate and work things through. I need to take a break from this stuff. If a seizure is coming on, it looks like it'll be a good one.

No worries. Good luck on the doozy. It's coming. Maybe you should try medication again. I'm hella more alert now.

Just finished re-reading Seized and I'm really not interested in dope. I can abide by these rough patches where it's like I'm thinking in syrup. It's also coincided with a heavier than usual work routine, so my attention has been strained. As long as I don't do a Tony Lazzeri, I'll be fine.

[Wolter]

Tom Kenny as a Brooklyn Lincoln

Even reading that cracks me up.

[Dr. Medulla]

Tom Kenny as a Brooklyn Lincoln

Even reading that cracks me up.

For those unaware but curious:

[Flex]

BTW, just checked the Denver Post—looks like our boy Flex managed a winner. His guy was up about 57-40 with about 80% of the votes counted. A lusty huzzah for Flex!

Huzzah for me! Thanks!

Much partying and merriment down in Denver last night. Great results across the board, and winning an election is awesome. Still on an emotional high. Also, still running on only 3 hours of sleep in the last 72 hours. Time for a wonderful nap.