I first heard the best joke about economics in 1975. The teller was the nuclear physicist (and nuclear power advocate) Sir Phillip Baxter, and he told it in answer to a question I had asked at a public forum.
The joke is:
A physicist, a chemist and an economist are shipwrecked on a desert isle, along with a container full of cans of baked beans.
The chemist says that if they can start a fire, he can calculate the temperature at which a can will explode.
“And, at this point, confidence is what it is all about… The first thing is to maintain some confidence in ourselves and the prospects for our country over time… Unfortunately, there is no lever marked ‘confidence’ that policy-makers can take hold of. Our task is very much one of seeking to behave, across the board, in ways that will foster, rather than erode, confidence. It is such confidence that, more than anything else, will help to drive us along the road to recovery.” (Glenn Stevens, April 21st 2009)
In May 1973, dissatisfaction over the teaching of economics at the University of Sydney went from a festering sore amongst the staff only to an outright revolt by a minority of the staff, and a majority of the students. In 1975, a new Department of Political Economy had its first intake into Economics I℗. Thirty four years later, it is still going. Professor Frank Stilwell, who has lived this dispute since 1970, is launching Political Economy Now!, a history of the dispute, next Tuesday at Sydney University’s Fisher Library (May 5th, 5.30pm, Level 5).
Eric Aarons’ book Hayek versus Marx: And Today’s Challenges will be launched at Gleebooks on Friday April 24th at 6pm. I will make an opening speech about the book and its remarkable author. There will be pre-launch drinks from 6 till 6.40.
Attendance is free, but places are limited. Please contact Gleebooks on (02) 9660 2333, or click on the link to Request a place on Gleebooks’ automated booking form. Gleebooks is at 49 Glebe Point Rd, Glebe; the launch will take place in the upstairs room, which can accommodate about 100.
Title: “Crunchtime”: Bringing together the best policy minds to discuss Australia’s future
Location: Trades Hall Auditorium, 4 Goulburn St, Sydney NSW
Link out: Click here
Description: The best policy thinkers from Australia and abroad will come together for “Crunchtime” — Australia’s first progressive think-tank conference.
Tax, social policy, the global financial crisis and climate change will be pulled apart by impressive policy minds including Ann Pettifor from Advocacy International in the UK. Ann has written extensively on debt and finance, climate change and international development and was one of the authors of the UK national economic foundation’s Green New Deal.
A number of blog members have noted that they’d like to have my PhD thesis on Minsky available, as well as my more recent papers on financial instability and endogenous money.
As a first step, here is a link to my PhD thesis. It’s written in my usual style, though because it’s equation heavy, it wouldn’t qualify as bedtime reading. Early next week I hope to reorganise my Research Page to have most of my academic papers accessible there, and structured according to topic.
This is something members of the blog won’t be amazed to hear, but it’s a milestone nonetheless: Debtwatch has just had its first two days with more than 10,000 unique readers:
There are also something in the vicinity of 500 RSS readers (I would appreciate finding out how many there are right now, from anyone more technically savvy than I am on these things). Oh, and over 1250 subscribers, making about 100 posts a day in a very active–and very affable–discussion.
I can’t think of any significant way to sign off here, so I’ll just take my hat off and thank you all for participating.
Broadcast on March 11 2009 by ABC Radio National Big Ideas
A blog member has kindly produced a transcript of the off-the-cuff talk I gave at this forum. I’ve made minor corrections to the punctuation below, but the text is otherwise as delivered on the night without speaking notes–so there are some grammatical slips. For those who want to listen to this alone–without also listening to Bernie Fraser beforehand–here is a link to the MP3 of my talk.
As usual, the latest set of data from the ABS on the economy was “unexpectedly worse” than (neoclassical) economists had been expecting. The consensus was for a 0.2% increase over the month of March, from 5.2 to 5.4 percent. In fact, it leapt by two and a half times as much, to 5.7%.
This was right in line with what I was expecting from a non-orthodox, “Hyman Minsky” point of view. As I have argued in numerous blogs, aggregate demand is the sum of GDP plus the change in debt. Now that our economy is utterly debt-dependent, the debt-financed asset-price bubbles have burst, and debt de-leveraging has begun in earnest, the economy will tank and unemployment will explode as debt-financed spending evaporates.
“Lies, damned lies, and statistics” is part of a phrase attributed to Benjamin Disraeli and popularised in the United States by Mark Twain: “There are three kinds of lies: lies, damned lies, and statistics.” The statement refers to the persuasive power of numbers, the use of statistics to bolster weak arguments, and the tendency of people to disparage statistics that do not support their positions. (Wikipedia)
Two recent speeches by the RBA supported the contention that Australian house prices are no longer overvalued, that mortgage repayment costs have returned to historic averages, that Australia is suffering a housing shortage, and therefore that the Australian housing market should not experience the catastrophic falls that are now commonplace across the OECD–and especially in the USA.
