Brexit

[wufwugy]

Given that it is not corporations that are enacting these regulations but government bureaucracy, why are corporations to blame instead of bureaucracy?

Note that I'm not defending corporations here. Individually, they're no better than governments. But the question is an important step because corporations are often blamed for something government is the cause of, and corporations are also often wrongly equated with the free market.

[wufwugy]

http://www.fda.gov/Food/GuidanceRegu...ucm2007962.htm

It seems like milk has in fact been regulated and tested at least since the 1920's, which is good since raw milk used to kill a lot of people.

"In 1938, milkborne outbreaks constituted twenty-five per cent (25%) of all disease outbreaks due to infected foods and contaminated water. Our most recent information reveals that milk and fluid milk products continue to be associated with less than one percent (<1%) of such reported outbreaks."

I guess I should explain why this is a different topic.

Your original hypothetical was about a bureaucracy applying a measure that changes nothing other than preventing deaths more efficiently than the free market would. Your latest response to my response is something along the lines of bureaucracies being able to reduce deaths with policy.

Your second point helps my point regarding your hypothetical. It would be way too expensive for the government to prevent milk deaths through adequate testing, and so they've taken a different approach which has changed more than the desired outcome. In fact, it can't be said how much pasteurization is responsible for death prevention today, or even how effective regulations on milk are. Regardless, this is the type of thing that you wished to avoid in your hypothetical, the unintended consequences. It's one thing to want to eliminate cyanide from food; but it's something else to do so by cooking it.

This is where the problems of regulations come from. The solutions to problems are never simple and consequences of proposed solutions are never fully understood. This is why that a system that provides solutions by mandate ends up creating more problems than a system that provides solutions by competition and choice.

[wufwugy]

BTW, economics is science too. Using the best knowledge available to humankind is not just about using chemistry to reduce deaths, but about using economics to organize society.

[OngBonga]

Given that it is not corporations that are enacting these regulations but government bureaucracy, why are corporations to blame instead of bureaucracy?

Corporations lobby government, and government yields because lawmakers tend to be corrupt. Both are to blame.

I seriously thought you were trolling at first. This is easily the most correct thing on the topic I've seen you say.

Here's the thing. I'm no economist, and the vast majority of the time when I'm debating anything here, it's based on my opinion and not a lot else. I don't bother to research things I say here, I rarely educate myself on economic matters because it's pretty much a waste of my time... it will only help me to engage better in debate with you! But this referendum, I feel a sense of obligation to educate myself, especially when it comes to economic matters, because I've kind of just been shrugging my shoulders and saying "whatever, sovereignty is more important", which was basically a cop out, another way of saying "I'll be fucked if I know what's going to happen to the economy". So I've been digging a little bit.

What stuck me as particularly interesting is that after WWII, The UK economy was particularly sluggish (we were still rationing for years), while the German economy went through such a boom that they became the third biggest economy in the world. Hang on, didn't we win the war? How the fuck did that happen? We borrowed money off you lot to get out of the shit, but Germany was much more damaged, and they had war repatriations to worry about too. They were much more indebted than we were, and had more rebuilding of infrastructure.

Guess who was deregulating, and guess who wasn't.

I then took a look at Switzerland, where Zurich is the city with the highest standard of living in the world. Their economy is insanely successful. Yep, it's one of the least regulated economies on the planet.

I then realised that the EU's economic growth is behind every other continent on the planet. The EU, of course, is heavily regulated.

I'm happy that I can now economically justify an "out" vote, I can stop shrugging my shoulders in ignorance.

[MadMojoMonkey]

BTW, economics is science too.

I strongly disagree with this statement. Economics can be studied with scientific rigor, but this is not what you (wuf) do or talk about.

At least, I can't think of a single peer-reviewed, scientific study which you have cited to describe the lessons of economics.
No judgement.

Using the best knowledge available to humankind is not just about using chemistry to reduce deaths, but about using economics to organize society.

This has nothing to do with science, btw. Not sure if you were implying as much or not.

If anything, you're describing technology, which is the application of scientific results.

You have, in the past, compelled me to investigate the field and find that economics can be a science.

Some economists use the scientific method to understand and describe the field. This is not a pervasive methodology among economists, though. Experimentation and observation are seldom codified into falsifiable statements, and when they are, those experiments are not repeated to show consistency throughout changing the people, places and times which are pertinent to the phenomena.

Or at least... links, please!

[wufwugy]

I strongly disagree with this statement. Economics can be studied with scientific rigor, but this is not what you (wuf) do or talk about.

I have discussed economics in experimental terms in the past. But typically, I only discuss the fundamental ideas that have solidified over time.

This has nothing to do with science, btw. Not sure if you were implying as much or not.

If anything, you're describing technology, which is the application of scientific results.

My point was a response to Cocco_Bill's regular claim that he cares about the best of what science has to offer. That is a funky statement to me since that's what I've been arguing for all this time.

Some economists use the scientific method to understand and describe the field. This is not a pervasive methodology among economists, though. Experimentation and observation are seldom codified into falsifiable statements, and when they are, those experiments are not repeated to show consistency throughout changing the people, places and times which are pertinent to the phenomena.

You'll get no complaints from me about the silly politicking of some economists. Maintaining rigor in a social science is just hard, and even well-trained economists fail at it while in pursuit of some other social or political idea. Everybody has an opinion about topics in social sciences, probably because the topics affect them and they feel like they understand them. You (the global you) tend to not get this in the hard sciences. You tend to not hear people say "I don't know anything about quantum mechanics, but here's what I think about entanglement" yet you do hear people say "I don't know anything about monetary policy, but here's what I think the central bank should do."

Or at least... links, please!

The only stuff I read is blogs by economists. Sometimes it includes them unpacking elements of peer reviewed literature, but usually it's about discussing some unique lesson involving the real world or arguing with other economists. Also textbooks.

[wufwugy]

Corporations lobby government, and government yields because lawmakers tend to be corrupt. Both are to blame.

Back in the 90s, Microsoft didn't lobby. They stayed out of government and wanted the government to stay out of their business. Congress didn't like this and threw a bunch of legal and regulatory trouble at Microsoft, "encouraging" them to lobby. Microsoft lobbies like every other good dog now.

Government is the alpha in the lobby/legislation relationship. It's the one holding the guns, the legal and enforcement power, and it doesn't "yield." It holds auctions, giving its services to the highest bidder and loudest voices. This is the government being corrupt because the government is corrupt, not government being corrupted by outside influences.

Here's the thing. I'm no economist, and the vast majority of the time when I'm debating anything here, it's based on my opinion and not a lot else. I don't bother to research things I say here, I rarely educate myself on economic matters because it's pretty much a waste of my time... it will only help me to engage better in debate with you! But this referendum, I feel a sense of obligation to educate myself, especially when it comes to economic matters, because I've kind of just been shrugging my shoulders and saying "whatever, sovereignty is more important", which was basically a cop out, another way of saying "I'll be fucked if I know what's going to happen to the economy". So I've been digging a little bit.

What stuck me as particularly interesting is that after WWII, The UK economy was particularly sluggish (we were still rationing for years), while the German economy went through such a boom that they became the third biggest economy in the world. Hang on, didn't we win the war? How the fuck did that happen? We borrowed money off you lot to get out of the shit, but Germany was much more damaged, and they had war repatriations to worry about too. They were much more indebted than we were, and had more rebuilding of infrastructure.

Guess who was deregulating, and guess who wasn't.

I then took a look at Switzerland, where Zurich is the city with the highest standard of living in the world. Their economy is insanely successful. Yep, it's one of the least regulated economies on the planet.

I then realised that the EU's economic growth is behind every other continent on the planet. The EU, of course, is heavily regulated.

I'm happy that I can now economically justify an "out" vote, I can stop shrugging my shoulders in ignorance.

Good stuff.

[wufwugy]

One thing I'll say about economics (or more like social sciences in general): even when you're an expert in the field, you can quite easily get away with disregarding evidence and theory. This is probably the case because of the large amount of dependent and confounding variables in social experimentation. Economics is sorta half-literary. This is my own way of saying that there is enough of a degree of uncertainty that a common practice of furthering the field is making a case based on correlations. If you remember, a week ago I lamented how the academic essay teaches students to think in terms of correlation=causation. Essentially, this is what I'm getting at.

Societies are so complex that even if God came down from Heaven and dispensed with the economic truths of how the world works, there would still be ample examples of situations where those truths seemed to not work, and you could technically make an academic case for those truths not being truths, so to speak. An example is with minimum wage. It's hard to find anything in economics that is as straightforward in a mathematics sense as a minimum wage's effects on the demand for labor, yet because controlling for variables adequately enough to eliminate all doubt is virtually impossible, and you can end up with situations in which a minimum wage has been applied and the demand for labor has increased. The most reasonable answer is that the minimum wage still reduced labor demand and that something else increased it by net, but an academic case can still be made that this doesn't conclusively demonstrate that the minimum wage reduces labor demand.

And so we're left with a situation where economists can get away with saying a lot of bullshit that isn't correct.

[The Bean Counter]

Everybody has an opinion about topics in social sciences, probably because the topics affect them and they feel like they understand them. You (the global you) tend to not get this in the hard sciences. You tend to not hear people say "I don't know anything about quantum mechanics, but here's what I think about entanglement" yet you do hear people say "I don't know anything about monetary policy, but here's what I think the central bank should do.

This is what makes the social sciences such great topics to study and Economics should be compulsory for teenagers imo. Some of the developments that will come around big data will be great for social science research too.

Just a note on Switzerland. It's tax system and neutrality makes it a great place for big corps and it's well paid execs to reside in. The UK also scores okay on that front with tax on profits of just 20%. Always staggers me that the parent company of my employer based in California pays 41%.

[The Bean Counter]

Shocking news about the MP being murdered today by a random, but pleased that all Brexit campaigning was cancelled as a result. Nothing worse than trying to turn a tragedy into a political opportunity i.e. Trump.

[CoccoBill]

How has that worked out?

To my knowledge it hasn't been tried anywhere.

What you want in regulations is what everybody wants, but it's not what happens when regulations are handed down by a monopoly funded through coercion.

Red herring and appeal to emotion.

Sensibleness of policy is efficiency of policy. Your morals are only as sensible as they are efficient. Let's say you have two different ideals that save lives: the first costs a billion dollars per head and the other costs one dollar per head. Which one is more sensible? Which one gets enacted and which one doesn't? This works down to the marginal level, where a policy that costs one dollar per life saved is a better policy than one that costs two dollars per life saved. The more cost-effective one is the one with the greatest positive effect in aggregate.

Red herring. The first costs $[arbitrary_sum] and aims at beneficial effects for everyone, the second costs $[somewhat_smaller_arbitrary_sum] and has beneficial effects only for a few. I'll go with the first one every time.

This is a different topic than the hypothetical you introduced. If you would like to stick within that hypothetical, I think we can get somewhere.

You said regulating and testing milk is impractical, and it isn't done. It clearly isn't and it is. True, I didn't check if cyanide is part of the FDA grade A pasteurized milk ordinance, but that wasn't the point, was it.

[wufwugy]

To my knowledge it hasn't been tried anywhere.

That's exactly my point. What you say you want is commonly wanted, but it just isn't what happens because when regulation is run by tax-based monopoly, other things take precedence. The best way anybody knows how to get science-based policies in place is by using the allocation method that the best of our science knows of: free markets.

You said regulating and testing milk is impractical, and it isn't done.

I said this according to the goals you wanted. Your cyanide claim requires much different parameters than that which is found in the milk example.

[MadMojoMonkey]

I wonder, in the milk example, if it can't be said that laws communicate public demands most efficiently between old consumers and new businesses.

Like, say I find a way to milk squirrels, and it turns out it's delicious. People going mad for delicious squirrel milk.

If there are no pre-existing regulations, then I may make a few mistakes in my ignorance of the dairy market and what people want from their dairy products which go beyond the flavor and mystique I'm selling them. Maybe my mistakes involve me not knowing that there could be unwanted poisons in the milk, like cyanide. Maybe I would be happy to test for and remove contaminants from my milk, but I had no idea there were such things.

Do you think this is a reasonable scenario (aside from the bit about milking squirrels)?

Do you think the development of regulations can be a free market response to previous companies selling contaminated products?
The market response could have been to merely put that company out of business by boycott, but the market freely chose to demand the alteration of not just one business, but all future business who make make the same mistake out of ignorance.

I find it very difficult to parse out how it is that a government action is never a free market response.
Is not the government a consumer?

[CoccoBill]

That's exactly my point. What you say you want is commonly wanted, but it just isn't what happens because when regulation is run by tax-based monopoly, other things take precedence. The best way anybody knows how to get science-based policies in place is by using the allocation method that the best of our science knows of: free markets.

False dichotomy, you're just stating that as a fact. Try walking in my shoes, would you accept that as evidence?

There are various avenues to get to a desired goal, in this case for example to have milk on the shelves that doesn't contain cyanide. Regardless of who or how comes up with the correct method, be it free markets, expert and science-based policy or a hobo under a bridge, there exists an objective best possible method to ensure that. What you're claiming is that the ONLY solution is free markets, that is, human behavior in markets, that cannot be replicated with a policy or an algorithm that a single human person can come up with. You're basically claiming that the free market is some infallible omniscient perpetual problem-solving machine. Until I see a very convincing scientific study to verify that, I'm gonna just remain agnostic. I've seen zero evidence that free markets always or even most of the time have desirable outcomes when it comes to "sensibleness". Quite the opposite, everything seems to point (quite predictably), that free markets just reflect the selfish, greedy behavior of humans.

I said this according to the goals you wanted. Your cyanide claim requires much different parameters than that which is found in the milk example.

What, no? I tossed up a random harmful substance that'd be nice to not have in milk, you said it'd be impractical to monitor and test for a harmful substance. Well obviously it isn't. How do the parameters change when eg. swapping cyanide to drug residue?

[wufwugy]

I wonder, in the milk example, if it can't be said that laws communicate public demands most efficiently between old consumers and new businesses.

Like, say I find a way to milk squirrels, and it turns out it's delicious. People going mad for delicious squirrel milk.

If there are no pre-existing regulations, then I may make a few mistakes in my ignorance of the dairy market and what people want from their dairy products which go beyond the flavor and mystique I'm selling them. Maybe my mistakes involve me not knowing that there could be unwanted poisons in the milk, like cyanide. Maybe I would be happy to test for and remove contaminants from my milk, but I had no idea there were such things.

Do you think this is a reasonable scenario (aside from the bit about milking squirrels)?

Laws distributed by monopoly certainly can communicate some public demand, but they just do so less efficiently (and they create unintended consequences, which I'll get to briefly). A potential squirrel farmer wouldn't be unaffected by norms in a free market, but he would have the lowest feasible barriers to entry.

In a free market for food safety, most of it would be handled by food safety companies that compete to most efficiently determine and signal safety of food. Food companies would consume these safety brands, and consumers of food would make choices based on brand quality. It is unlikely that a squirrel farmer could get his product into any retail companies without a safety branding recognized by the companies. Retail companies selling unbranded food would be a pretty big risk to their own brand and also the product would not sell that well in the first place since people would be wary of consuming food that has not been labeled safe by a trusted brand.

In all this, safety is still a norm in a free market. It's just more effective and cheaper because of how competition spurs innovation and efficiency. Even still, this potential squirrel farmer would have a far lower barrier to entry than this suggests, since it would be legal for him to start really small and unbranded. People he knows, people in his town, people who know him -- if he's a standup guy, they don't need his milk to be branded safe to buy it from him. This is like how you don't bring the FDA with you when you eat at your friend's house and he cooks steaks. He could have left the steaks in the sun for a day, but by your judgment he doesn't do that, so you're okay with eating what he prepares.

As the squirrel farmer scales up and sells to people who don't know him that well, he's gonna need safety branding in order to compete effectively. But if the law was always that food sold to people needs to be approved safe by a bureaucracy, the squirrel farmer would have never gotten his foot in the door since it would have taken a lot more capital than he had in order to meet those standards. This is what Ong was getting at when he mentioned the EU milk regulations and how he now sees that you basically have to be rich to do anything in a highly regulated market.

Do you think the development of regulations can be a free market response to previous companies selling contaminated products?
The market response could have been to merely put that company out of business by boycott, but the market freely chose to demand the alteration of not just one business, but all future business who make make the same mistake out of ignorance.

It probably can be said that a free market response could be to eliminate the free market. Regardless, if producers and consumers are in a situation where it is illegal for them to exchange resources voluntarily, they're not in a free market.

Is not the government a consumer?

Sort of. The government certainly can consume, but it doesn't do so using funds acquired by the voluntary choice of others, which makes it the antithesis of a free market actor.

[wufwugy]

False dichotomy, you're just stating that as a fact.

I am stating it as fact. Microeconomics is the study of the allocation of limited resources. Economists at large are intense advocates of free markets because they are the best way that economists know for complex economies to allocate limited resources.

There are various avenues to get to a desired goal, in this case for example to have milk on the shelves that doesn't contain cyanide. Regardless of who or how comes up with the correct method, be it free markets, expert and science-based policy or a hobo under a bridge, there exists an objective best possible method to ensure that.

It's possible there is some lost in translation going on, since what you just said means that the free market is the best way to find the best method.

What you're claiming is that the ONLY solution is free markets, that is, human behavior in markets, that cannot be replicated with a policy or an algorithm that a single human person can come up with. You're basically claiming that the free market is some infallible omniscient perpetual problem-solving machine.

No, I don't. Free markets are simply more efficient at solving problems.

everything seems to point (quite predictably), that free markets just reflect the selfish, greedy behavior of humans.

You're wearing clothes created by these selfish interests, eating food created by these selfish interests, typing on a computer created by these selfish interests, in a house or car created by these selfish interests.

What, no? I tossed up a random harmful substance that'd be nice to not have in milk, you said it'd be impractical to monitor and test for a harmful substance. Well obviously it isn't. How do the parameters change when eg. swapping cyanide to drug residue?

You asked for this goal to be met in such a way that it prevents more deaths than free market behavior would. It is implied that you want the parameters to do so to not alter other elements of the milk (since that would create the type of unintended consequences that your hypothetical assumes can be avoided). I presented a scenario in which this would happen. I pointed out that it doesn't work this way since it would be way too expensive. You then rebutted by pointing out the way it works today, which agrees with my point, since the methods used today do not prevent deaths the way your hypothetical asked them to.

[CoccoBill]

I am stating it as fact. Microeconomics is the study of the allocation of limited resources. Economists at large are intense advocates of free markets because they are the best way that economists know for complex economies to allocate limited resources.

How many times did that sentence have to be repeated to you until it started to resonate? Just so I know when I'll be converted.

It's possible there is some lost in translation going on, since what you just said means that the free market is the best way to find the best method.

That could be, since I completely disagree with your conclusion.

You're wearing clothes created by these selfish interests, eating food created by these selfish interests, typing on a computer created by these selfish interests, in a house or car created by these selfish interests.

Exactly. Clothes made by kids in sweatshops, computers built in chinese labor camp factories etc. Not my idea of "sensibleness". Since it seems to be unclear, let me reiterate: free markets do not ensure fair working conditions, health and safety, ethical and moral values or common interests. If it did, why do we have regulations? Before milk became regulated in the US, the market regarding milk was free, and people died.

You asked for this goal to be met in such a way that it prevents more deaths than free market behavior would. It is implied that you want the parameters to do so to not alter other elements of the milk (since that would create the type of unintended consequences that your hypothetical assumes can be avoided). I presented a scenario in which this would happen. I pointed out that it doesn't work this way since it would be way too expensive. You then rebutted by pointing out the way it works today, which agrees with my point, since the methods used today do not prevent deaths the way your hypothetical asked them to.

To be perfectly honest and sincere, I have no idea what you're saying. I said that milk safety regulation would be an example of a non-market distorting regulation, and it indeed seems to correlate with massively lower instances of death and diseases compared to the time before the regulation. What in that is way too expensive? How are the methods used today not preventing deaths "the way I asked them to"? What parameters? Why were people dying before the FDA ordinance on pasteurized milk and why don't you buy cheaper free market imported unregulated milk from China? What are the unwanted consequences of the pasteurized milk ordinance (or any similar food safety regulation)?

Maybe as a protest against the government tyranny you could start only using non-FDA approved goods and products? Up for it?

[a500lbgorilla]

Societies are so complex that even if God came down from Heaven and dispensed with the economic truths of how the world works, there would still be ample examples of situations where those truths seemed to not work, and you could technically make an academic case for those truths not being truths, so to speak.

"The phenomena with which economists are concerned are production, consumption, distribution and exchange—particularly via markets. But since so many different causal factors are relevant to these, from the laws of thermodynamics and metallurgy to accounts of geography and social norms, even the laws governing digestion, economics cannot be distinguished from other inquiries only by the phenomena it studies."

Maybe if God spots us the rest of science first, economics would make sense.

[wufwugy]

Not coincidentally, their new government is one they can’t vote out. The European Commission, which has a virtual monopoly on proposing European legislation, never submits itself to elections. It is an appointed body of unknown bureaucrats and failed national politicians. Nor can British, French, or German parliaments reject or amend the Commission’s laws and regulations or the European court’s decisions. Nor can their voters repeal them. European law is superior to what are still quaintly called “national laws.” And if a national referendum (one of the few escape hatches in this panopticon) rejects a European decision, the voters are asked to vote again until they get it right. In short the EU’s defenses against democratic accountability are pretty watertight.

Read more at: http://www.nationalreview.com/articl...acy-vote-leave

[Keith]

there is an irony in the fact that the UK is further down the road of union by having a common language, common elected government, common currency ,common army ,foreign policy etc and after a couple of hundred years have now been devolving power back to national governments to placate nationalistic tendencies whilst Europe wants to add more and more political and monetary union and increasing its size yet the UK is voting on whether to leave and if we stay we have opted out of the political and monetary union.

A vote to leave with current national debt levels is probably disadvantageous at the moment coupled with the economic uncertainty that leaving will entail with increased interest rates and lower gdp, and with world growth depressed at the moment shifting exports from europe to rest of world without trade agreements in place is going to be difficult. give it a few years and reduced debt mountain and greater world trade and tacit trade agreements negotiated and in place should the UK leave Europe, it would be easy to get another referendum on whether to leave by electing a UKIP government and the leave camps arguments would be stronger by being able to rebut the economic impacts of a leave vote.

A close "stay" result will also be a shot across europe's bows to avoid antagonising UK voters as well as the UKIP election route to UK leaving will be all to obvious to them.

[wufwugy]

Each country has a dominant strategy in freeing up trade unilaterally. Trade "deals" are overrated and they can only provide benefit when countries opt to not employ their dominant strategy. The UK does not need to stay in the EU in order for its trade to be the best it can be; it needs to deregulate its own trade as much as possible. An additional benefit of engaging your dominant strategy is that it gives other countries great incentive to pursue their dominant strategy as well.

[wufwugy]

Why don't countries employ their dominant strategy? Best guess: voters don't like it. Unilateral deregulation of trade sounds like you're giving away the farm. Regardless, it's one of the things economists of every variety agree on the most. Freer trade is better, and it doesn't matter what the other guy is doing.

[wufwugy]

This is obviously in a strict, normal sense. If you free up trade to sell bombs to ISIS, you're creating other problems that make that trading a bad idea. Those problems are specific and not many though.

[rong]

This is obviously in a strict, normal sense. If you free up trade to sell bombs to ISIS, you're creating other problems that make that trading a bad idea. Those problems are specific and not many though.

Is it that much of a stretch to go from selling bombs to isis to buying some product produced by slave labour in China?

[MadMojoMonkey]

Why don't countries employ their dominant strategy? Best guess: voters don't like it. Unilateral deregulation of trade sounds like you're giving away the farm. Regardless, it's one of the things economists of every variety agree on the most. Freer trade is better, and it doesn't matter what the other guy is doing.

I can't help but think that either
A) economists are shooting themselves in the foot by not screaming this from the rooftops and making sure that voters understand what's up

OR

B) economists can't even convince the richy rich types to support their economic theories, thereby leeching nearly all the credit economists claim to. (This assuming that the richy rich types would be more able to lobby for the legislation they need to make even more monies.)


Thoughts?

[wufwugy]

Is it that much of a stretch to go from selling bombs to isis to buying some product produced by slave labour in China?

In this hypothetical, you're right. The issue is "is it actually slave labor in China?"

The factories that are popularly called all sorts of names like slave camps operate by choice of labor. Millions of Chinese from the dirt poor western plains have moved to the coast so that they can work in these factories. They make more money in these factories than they did before, the return rate is extremely high, and it is all done by choice. The Chinese government does not force any of this labor and neither do any of the companies running the factories. China has experienced rapidly rising living standards of its poor in greater quantities than any example in history, and part of the reason is because of the poor western Chinese choosing to work in these factories.

It should also be noted that working conditions in the factories has been improving significantly, and the reason for this is because the Chinese laborers have such drastically increased bargaining power since they have been becoming wealthier.

I do not believe it is accurate to liken this to slave labor. It does not have the necessary elements of slave labor (nobody is forced to work in the factories) and there is very high competition among the laborers to work in the factories.

[wufwugy]

I can't help but think that either
A) economists are shooting themselves in the foot by not screaming this from the rooftops and making sure that voters understand what's up

OR

B) economists can't even convince the richy rich types to support their economic theories, thereby leeching nearly all the credit economists claim to. (This assuming that the richy rich types would be more able to lobby for the legislation they need to make even more monies.)


Thoughts?

Freeing up trade is probably the area of economics in politics that has had the most movement over the last few decades. Economists have convinced the vast majority of policymakers, and large majorities of policymakers in both parties favor freer trade.

As far as economists communicating with the public, yeah, um, economists may just be the absolute poorest communicators on the planet. A good deal of them know it too. I have some guesses for why that is, but honestly I don't know.

[MadMojoMonkey]

There are very few truly charismatic physicists, too. Neil DeGrasse Tyson, Bill Nye, Richard Feynman... not too many and I'm drawing from decades. (Research physicists will immediately scoff at the suggestion that Tyson is a physicist. Lame.)

There are a rising group of YouTube presenters whom are not really doing physics communication per se, but whom are amazing at presenting cool physics and engineering toys and phenomena that they want to highlight.

[MadMojoMonkey]

What thread is this? Oh yeah.



Any criticisms? I hate that I get more newsy-feeling analysis from a comedian than these FTR discussions.

[rong]

In this hypothetical, you're right. The issue is "is it actually slave labor in China?"

The factories that are popularly called all sorts of names like slave camps operate by choice of labor. Millions of Chinese from the dirt poor western plains have moved to the coast so that they can work in these factories. They make more money in these factories than they did before, the return rate is extremely high, and it is all done by choice. The Chinese government does not force any of this labor and neither do any of the companies running the factories. China has experienced rapidly rising living standards of its poor in greater quantities than any example in history, and part of the reason is because of the poor western Chinese choosing to work in these factories.

It should also be noted that working conditions in the factories has been improving significantly, and the reason for this is because the Chinese laborers have such drastically increased bargaining power since they have been becoming wealthier.

I do not believe it is accurate to liken this to slave labor. It does not have the necessary elements of slave labor (nobody is forced to work in the factories) and there is very high competition among the laborers to work in the factories.

Well, considering the lack of freedom they start with and the horrible system that left them so poor I'm the first place, the concept of choice is a little misleading. If I forcibly make you live in a sewer and later give you the option of living I'm a shed, you'd probably take it, but that doesn't mean the shed is suitable accommodation.

[wufwugy]

What thread is this? Oh yeah.



Any criticisms? I hate that I get more newsy-feeling analysis from a comedian than these FTR discussions.

So, if Milton Friedman was still alive and he was told that a whole bunch of experts like the organizations listed by Oliver believe that Leave would be worse for the economy, I suspect he would say, "well, they're right and they're wrong." He could then go on to explain why. If I'm the one explaining why, like I'm writing an essay in an economics class for reasons why Brexit could have an immediate result in declining GDP, the first point I would make is uncertainty. Markets don't like uncertainty and any increase in uncertainty should be expected to cause a decline in expectations, and this is often the case regardless of whether or not that which causes the uncertainty would be positive. The stock market is pretty bad at assessing the effects of, say, regulatory decentralization. Economists like Milton Friedman claim regulatory decentralization plays a significant role in positive effects of fields like education and healthcare. Regardless, the stock market is going to much more effectively respond to the uncertainty of a change of policy than its more abstract, overarching ramifications.

So yeah, experts who say Brexit is bad because GDP would likely decline right after Brexit are most likely right and wrong. You can be a good economist and make your case for why Brexit is bad because of this, but it's the great economist who isn't hung up on this superficial assessment because he's looking deeper and assessing the situation based on the principles that economics teach about how economies organize over the long term.

[wufwugy]

Well, considering the lack of freedom they start with and the horrible system that left them so poor I'm the first place, the concept of choice is a little misleading. If I forcibly make you live in a sewer and later give you the option of living I'm a shed, you'd probably take it, but that doesn't mean the shed is suitable accommodation.

That would be the case in your hypothetical, but how is this the case in China? Its poor western farmers are not forced into their situation. They were born into a situation that isn't that productive. Millions migrate to work in a more productive situation.

What China is undergoing is the same thing the US did and the UK did, and it is the only way that economists know about to turn a poor economy into a prosperous one.

BTW the horrible system that made China so shitty in the first place was socialism and its intense regulations. It is because of market reforms revolving mostly around deregulation that so many poor Chinese people are living better lives. The Chinese government still has a significant number of reforms to institute.

[The Bean Counter]

John Oliver is pretty much where I stand on Brexit. The EU does need a LOT of reform though.

[wufwugy]

Oliver's perspective is that UK should remain because the UK benefits relative to the way things look right now. I find this lacking due to reasons like it doesn't account for how things would be different under reform. For example, would the UK be better off with the status quo or with all of Oliver's listed negatives of leaving yet in an environment where the EU is growing at 4-5% NGDP again? The latter would be better by far.

I remember back in 2010 I was posting here how the EU is an economic disaster and that its economy would not recover except through "extreme" measures like dissolution of the EU or the opposite extreme of fiscal unity and taxation. Six years later and the situation hasn't changed.

I'm afraid the "reforms" that will ultimately lead the EU through this are further centralization of policy in Brussels. There are two options: the EU becomes greatly weakened or it becomes a federation. Take your pick. The elites want the latter and it's gonna take many decades to get there.

[MadMojoMonkey]

I remember back in 2010 I was posting here how the EU is an economic disaster and that its economy would not recover except through "extreme" measures like dissolution of the EU or the opposite extreme of fiscal unity and taxation. Six years later and the situation hasn't changed.

I'm not sure if you're saying you were wrong then, or you're still right, now.

Knowing you, I'd guess the latter.

Care to put a time frame on your prediction. I can't help but think if you say an economy is headed for disaster and 6 years later it's still functioning that you missed something in your prediction... perhaps nothing more than a time frame.

[Savy]

John Oliver is pretty much where I stand on Brexit. The EU does need a LOT of reform though.

Most of the reforms I hear people talking about are either things I disagree with (i.e. restricting movement of people) or things that aren't going to happen/would have little affect on things (i.e. restructuring of European parliaments).

It's a pretty easy stance when people are arguing that something is bad you get them on side by saying we'll change it and make it better. Without tangible ideas or even suggestions it's all just complete bollocks. The worst part about it though is it's completely catering to a loud bunch just so they stop making a fuss. The only issue most people give a fuck about is immigration. For how much it dominates everything it's just a complete none issue.

When you look at how people vote in European elections, which I can only imagine will be strengthened if we vote remain, no real influence for better change is going to be there. It's just idiots who hate Europe doing there best to make it ineffective and wasteful, destroying it from the inside.

As an aside, I previously have said (maybe not in this thread) about a leave vote legitimising the views of horrible cunts but I didn't expand on who when asked. That video gives a brief indication.

[wufwugy]

I'm not sure if you're saying you were wrong then, or you're still right, now.

Knowing you, I'd guess the latter.

Care to put a time frame on your prediction. I can't help but think if you say an economy is headed for disaster and 6 years later it's still functioning that you missed something in your prediction... perhaps nothing more than a time frame.

I didn't say it was headed for disaster, but that it is disaster and won't recover unless such and such.

I've been following the EU economy since maybe late 2009. It was bad then and has not made much improvements. Its growth rate is garbage and the primary reason is that it has a monetary union without a fiscal union, which gives the central bank an overwhelming incentive to keep policy too tight. It is very hard to imagine the central bank changing this strategy since, well, it hasn't even though boatloads of American economists have been saying it should, and because doing so would help the peripheral countries (like Greece) at the expense of the central countries (like Germany).

The only solution I know of that could be implemented in the short term and would fix the problem for the long term is dissolution of the EU. The other solution, which is the one I think will come about if things like Brexit don't gain momentum, is that at some eventual point, probably after decades of garbage growth in the EU, the countries will start favoring fiscal unity and giving Brussels more power. That whole scenario is so out there that I can't really even imagine how it would work.

[The Bean Counter]

Most of the reforms I hear people talking about are either things I disagree with (i.e. restricting movement of people) or things that aren't going to happen/would have little affect on things (i.e. restructuring of European parliaments).

It's a pretty easy stance when people are arguing that something is bad you get them on side by saying we'll change it and make it better. Without tangible ideas or even suggestions it's all just complete bollocks. The worst part about it though is it's completely catering to a loud bunch just so they stop making a fuss. The only issue most people give a fuck about is immigration. For how much it dominates everything it's just a complete none issue.

When you look at how people vote in European elections, which I can only imagine will be strengthened if we vote remain, no real influence for better change is going to be there. It's just idiots who hate Europe doing there best to make it ineffective and wasteful, destroying it from the inside.

As an aside, I previously have said (maybe not in this thread) about a leave vote legitimising the views of horrible cunts but I didn't expand on who when asked. That video gives a brief indication.

Yeah, agree with you. I hate the way people talk about immigration being a problem - the UK wants good, cheap labour to enable it to flourish and many of the leave voters don't think about the impact on exports.

Edit: Just to add, the kind of reform I want is almost a reversal to a free trade area, but without any of the other BS that comes with the EU.

[The Bean Counter]

Oliver's perspective is that UK should remain because the UK benefits relative to the way things look right now. I find this lacking due to reasons like it doesn't account for how things would be different under reform. For example, would the UK be better off with the status quo or with all of Oliver's listed negatives of leaving yet in an environment where the EU is growing at 4-5% NGDP again? The latter would be better by far.

I remember back in 2010 I was posting here how the EU is an economic disaster and that its economy would not recover except through "extreme" measures like dissolution of the EU or the opposite extreme of fiscal unity and taxation. Six years later and the situation hasn't changed.

I'm afraid the "reforms" that will ultimately lead the EU through this are further centralization of policy in Brussels. There are two options: the EU becomes greatly weakened or it becomes a federation. Take your pick. The elites want the latter and it's gonna take many decades to get there.

I think the first para you're saying that Brexit could lead to dissolution of the EU as it currently stands (and therefore lead to strong growth)? If so, I'd be voting for exit, but I can't see it happening.

There's definitely been some fuck ups with the EU. The intent to move towards full fiscal and monetary union for such diverse economies, as well as allowing countries like Greece to join have been a disaster. I'd like to think everybody recognises this now and that future reform will reverse some of these movements, but you're probably right in that it will go the other way. If it did, I think Brexit would almost be a certainty.

[wufwugy]

I think the first para you're saying that Brexit could lead to dissolution of the EU as it currently stands (and therefore lead to strong growth)? If so, I'd be voting for exit, but I can't see it happening.

There's definitely been some fuck ups with the EU. The intent to move towards full fiscal and monetary union for such diverse economies, as well as allowing countries like Greece to join have been a disaster. I'd like to think everybody recognises this now and that future reform will reverse some of these movements, but you're probably right in that it will go the other way. If it did, I think Brexit would almost be a certainty.

So are you saying that the terms in this current proposal are weak? My premise has been that if Britain leaves, it will further incentivize other countries to leave. I think a successful Brexit will weaken the EU, and that's my goal. So are you saying that you think a successful Brexit would not do this?

[wufwugy]

Britons have nothing to fear from the EU. It's only a bunch of unelected bureaucrats with superseding authority using their power to ban products that people want.

[OngBonga]

...as lower wattage vacuum cleaners need to be used for longer to achieve the same results.

...

[wufwugy]

That's what bureaucratic regulation does. Convince people that it's for a greater good, while in reality it just increases real costs by a teeny tiny fraction. Do this for generations and you end up with situations like that which was documented in Brazil recently where the government wouldn't build a bridge because it would cost them an estimated 200,000 but then the townspeople decided to take matters into their own hands an build it themselves, with a final cost of 8,000. Inb4 the government sweeps in and tears the bridge down because it isn't up to code.

[OngBonga]

Sadly the UK is about to prove that we're a nation of morons by saying "yup that's cool with us".

[wufwugy]

I hold out hope for teh shy tory effect

[CoccoBill]

Do this for generations and you end up with situations like that which was documented in Brazil recently where the government wouldn't build a bridge because it would cost them an estimated 200,000 but then the townspeople decided to take matters into their own hands an build it themselves, with a final cost of 8,000. Inb4 the government sweeps in and tears the bridge down because it isn't up to code.

I don't disagree, but we humans do have a heavy outcome bias. Your story would have an entirely different moral to it, if it had ended with the bridge failing and 200 people killed.

[wufwugy]

I don't disagree, but we humans do have a heavy outcome bias. Your story would have an entirely different moral to it, if it had ended with the bridge failing and 200 people killed.

It's a good thing we're not basing our arguments on anecdotes.

[The Bean Counter]

So are you saying that the terms in this current proposal are weak? My premise has been that if Britain leaves, it will further incentivize other countries to leave. I think a successful Brexit will weaken the EU, and that's my goal. So are you saying that you think a successful Brexit would not do this?

Well it would only be the net contributors that will be incentivised to leave. British exit would of course weaken the EU, but I'd prefer the EU to be stable for trading with.

My ideal would be to see the 4-5 countries with the highest GDP (and therefore the net contributors) having a referendum at the same time, with a German vote for exit key. It's less likely for one country to take a punt and go for exit alone, but I think it's more likely if Germany, France and Italy were also voting. The political message to Brussels would be so much stronger too in terms of actually getting something done for the better.

[The Bean Counter]

That's what bureaucratic regulation does. Convince people that it's for a greater good, while in reality it just increases real costs by a teeny tiny fraction. Do this for generations and you end up with situations like that which was documented in Brazil recently where the government wouldn't build a bridge because it would cost them an estimated 200,000 but then the townspeople decided to take matters into their own hands an build it themselves, with a final cost of 8,000. Inb4 the government sweeps in and tears the bridge down because it isn't up to code.

Procurement procedures at public funded bodies definitely result in higher costs. There are a lot of restrictions on the types of contractors that can carry out the work, which limits the supply of contractors, but those contractors also ramp up the price as soon as they know the customer.

[wufwugy]

My ideal would be to see the 4-5 countries with the highest GDP (and therefore the net contributors) having a referendum at the same time, with a German vote for exit key. It's less likely for one country to take a punt and go for exit alone, but I think it's more likely if Germany, France and Italy were also voting. The political message to Brussels would be so much stronger too in terms of actually getting something done for the better.

Regardless, if the UK leaves, it is likely to snowball.

I also don't consider dissolving trade deals a problem. The problem is thinking in terms of deals in the first place. We should be thinking in terms of the economic benefit created by deregulation of trade even if unilateral. If the trade union were to dissipate, it would likely be the case that countries would start thinking more correctly about trade and focus on freeing up transactions regardless of what other countries are doing. This then would ignite a trade war, just the good kind, where everybody deregulates because those who don't fall behind on economic benefit.

[rong]

I'm sure this is somehow related to why capitalism is bad.


https://i.redd.it/suzkkojte25x.png

[wufwugy]

I'm sure this is somehow related to why capitalism is bad.


https://i.redd.it/suzkkojte25x.png

I blame people like Paul Krugman for perpetuating a wrong idea about economics that even he doesn't believe: that more consumption=more prosperity and economic growth. The truth is that prosperity comes from production and productivity. Consumption is more a symptom of prosperity.

So, the examples the comic gives of behavior that, if ceased, would hurt the economy, are actually examples of behavior that are poor for the economy in the first place. People not wasting money on bad investments and bad debt is great stuff. In fact you can go so far as to say that if it was the cultural norm to not waste capital in these obvious ways, poverty would be eliminated.

[wufwugy]

I don't disagree, but we humans do have a heavy outcome bias. Your story would have an entirely different moral to it, if it had ended with the bridge failing and 200 people killed.

I want to say something further about this.

A good economist doesn't think in terms of a bridge. It could be said a good economist thinks in terms of every bridge, but really it's that a good economist thinks in terms of all inputs. Here's what I'm getting at, and this should clarify part of why I often talk of why efficiency is most important.

Let's take the scenario where we have two different kinds of bridges: the $200k bridge and $8k bridge. Let's say the $200k bridge is more structurally sound than the $8k bridge. Let's say 1% of the time, the $200k bridge fails, and 5% of the time the $8k bridge fails. Let's say that when they fail, they kill on average 20 people. Let's say that a country has 1000 bridges. Let's also say that every additional $50k saved results in 1 less death on average (because of people buying more needed healthcare). This is all overly simplistic, but it shows the principle.

Let's run a scenario where all 1000 bridges are the $200k ones at 1% failure rate and 20 deaths a pop. That results in 200 deaths. In a scenario where all 1000 bridges are the $8k, 5% failure rate ones, the results are 1000 deaths. So, this means that if a country builds only the $200k bridges rather than the $8k bridges, there will be 800 fewer deaths, right? Not so fast. This doesn't account for the opportunity cost of not going with the $8k bridges and having $192k each left over. As we saw earlier, every $50k extra results in 1 less death elsewhere in the society. So, when we do the numbers, if all bridges are the $8k ones instead of the $200k bridges, there are leftover funds of $192M. At 1 less death per $50k, the extra $192M results in 3840 fewer deaths. Comparing the two scenarios, we find that the $200k bridges result in 200 deaths, and the $8k bridges result in 1000-3840=-2840 deaths. The difference comes to the $8k bridges resulting in 3040 more saved lives than the $200k bridges even though the failures of the $8k bridges themselves kill more people.

If you increase the safety of something, you're not necessarily increasing the safety benefit. It all depends on how much that safety costs.

[wufwugy]

LOL I'm watching Sky News live. Very British. They got some guy named Professor So n So explaining something in such a technical and weird way that his conclusion didn't seem to match up with his points. Plus the women pundits are seriously not hot.

[wufwugy]

OMG you blokes have a place called Nuneaton and Bedworth? Be more obvious about class, will ya? Who's eating 'round here? Nobody! But is he worthy of a bed? Perhaps!

[OngBonga]

Holy fucking fuck.

We voted out.

We grew some balls.

I am actually in shock.

[OngBonga]

Nuneaton isn't far from me, it's a shithole.

I have no idea why that town name amuses you, the joke is lost on me.

[rong]

I'm genuinely sad.

[wufwugy]

Nuneaton isn't far from me, it's a shithole.

I have no idea why that town name amuses you, the joke is lost on me.

Nuneaton = none eatin'

[rong]

Why the fuck does Nigel farage somehow get to be the face of the leave victory? The one thing I've been annoyed by more than anything is how both the arguments and the results have been framed. That's how this was won and lost, the leave campaign making a simple and clear argument about control and immigration. I don't know what the remain campaign were arguing.

[The Bean Counter]

Shit just got real and now Cameron has stepped down. Hold tight, because things are going to get bumpy for a couple years.

Decent article on BBC about next steps:
http://www.bbc.co.uk/news/uk-politic...endum-36420148

I don't want to think about how much my wealth declined overnight in terms of pension and property value. Plus my day to day cash flow will also take quite a big hit in the short/medium term.

Some great articles on the Mash today (as always):
http://www.thedailymash.co.uk

[rong]

I opened a mortgage and commercial finance broker business about 8 months ago. All my money is in it. Funny feeling I may regret not sticking to being employed.

[spoonitnow]

I opened a mortgage and commercial finance broker business about 8 months ago. All my money is in it. Funny feeling I may regret not sticking to being employed.

gl man

[wufwugy]

Good luck guys.

[wufwugy]

Per Scott Sumner and David Beckworth analyses:

Basically what happened overnight is that the world was hit by a massive monetary shock. Central banks notoriously misdiagnose these, like in the 30s and 2008 -- where the subsequent recessions came from poor central bank behavior. We'll see if they get their shit together and stop creating recession this time around.

[wufwugy]

Why the fuck does Nigel farage somehow get to be the face of the leave victory? The one thing I've been annoyed by more than anything is how both the arguments and the results have been framed. That's how this was won and lost, the leave campaign making a simple and clear argument about control and immigration. I don't know what the remain campaign were arguing.

It is strange and unfortunate. Emotional arguments and simple soundbites win politics.

Granted, if instead politics was reasoned and thoughtful, I suspect the EU would have been given a far greater dressing down than it got. That's because people would care about arguments like how if it is the case that the UK benefits on trade by being in the EU, it necessarily means that the EU is protectionist on trade and bad for global trade.

[Keith]

I opened a mortgage and commercial finance broker business about 8 months ago. All my money is in it. Funny feeling I may regret not sticking to being employed.

lower house price may benefit your mortgage brokering as houses become more affordable.

[rong]

This is pretty interesting :

http://www.telegraph.co.uk/news/2016...nd-who-will-b/

Basically, the young and the educated wanted to stay and the old and the uneducated wanted to leave.

[rong]

lower house price may benefit your mortgage brokering as houses become more affordable.

Lower, yes, perceived as falling, no.

[wufwugy]

This is pretty interesting :

http://www.telegraph.co.uk/news/2016...nd-who-will-b/

Basically, the young and the educated wanted to stay and the old and the uneducated wanted to leave.

Education results are weird. One example of why is that academics of most varieities tend to vote one way yet academic economists tend to diverge from that greatly.

[The Bean Counter]

This is pretty interesting :

http://www.telegraph.co.uk/news/2016...nd-who-will-b/

Basically, the young and the educated wanted to stay and the old and the uneducated wanted to leave.

Yes, it was clear that this would happen and then it comes down to a question of turnout. A lot of the leave voters won't live long enough to see any true impact of their vote.

I think what annoys me most about the result is that the overwhelming majority that voted leave haven't done so with any intelligent critical analysis. I'm totally fine with anybody choosing leave on the basis of believing there will be xyz economic benefits and the short term pain will be worth it. Unfortunately, those are few and far between and it tends to be fuckwits that just don't like Johnny Foreigner and think that immigration is to blame for their shitty life. It pains me to think that the rest of the world now views us as a small minded, unwelcoming nation too - hardly an attractive place to invest as a multinational company.

[Savy]

Education results are weird. One example of why is that academics of most varieities tend to vote one way yet academic economists tend to diverge from that greatly.

You seem to think that the UK is going to start making good economic decisions as a result of leaving the EU. That isn't going to happen.

[rong]

Yes, it was clear that this would happen and then it comes down to a question of turnout. A lot of the leave voters won't live long enough to see any true impact of their vote.

I think what annoys me most about the result is that the overwhelming majority that voted leave haven't done so with any intelligent critical analysis. I'm totally fine with anybody choosing leave on the basis of believing there will be xyz economic benefits and the short term pain will be worth it. Unfortunately, those are few and far between and it tends to be fuckwits that just don't like Johnny Foreigner and think that immigration is to blame for their shitty life. It pains me to think that the rest of the world now views us as a small minded, unwelcoming nation too - hardly an attractive place to invest as a multinational company.

I don't think it's just foreigner hating folk, it's people disillusioned with they status quo, looking for change.

This guardian article does a good job of exploring some of that sentiment:

http://www.theguardian.com/politics/...ty-westminster

[wufwugy]

Unfortunately, those are few and far between and it tends to be fuckwits that just don't like Johnny Foreigner and think that immigration is to blame for their shitty life. It pains me to think that the rest of the world now views us as a small minded, unwelcoming nation too - hardly an attractive place to invest as a multinational company.

I agree. But there is a solution. Take back the narrative. Political and media elites, and even academia, push narratives that are just wrong. The narrative is that things are always better when the government does more and anybody who disagrees is stupid and greedy; it's that any explanation about divergences in outcomes relevant to a culture or minority (as long as it isn't white male, wealthy, Christian, or an individual) is bigotry and hate speech. The elites (the educated elites) are good at explaining themselves, and when those who aren't have opinions the elites don't like, the elites ridicule them. They're the ones painting the "Johnny Foreigner" picture. They don't know what the people are thinking and they don't care. They find racists and xenophobes wherever they want to find them, regardless of the fact that the actual racism and xenophobia behind the beliefs of the accused are minuscule.

[a500lbgorilla]

I'm still stunned by this.

This is pretty interesting :

http://www.telegraph.co.uk/news/2016...nd-who-will-b/

Basically, the young and the educated wanted to stay and the old and the uneducated wanted to leave.

Whelp...