The Dim-Post

November 11, 2012

Three times is enemy action

Filed under: Politics — danylmc @ 4:39 pm

It’s Shane Jones vs Gareth Hughes again.

Northland-based Labour list MP Shane Jones has again hit out at the Green Party for opposing development of the regions’s resources, including oil and gas, which he says could help reduce spiralling Maori unemployment.

Green Party oceans spokesman Gareth Hughes said the Government was “gambling with New Zealand’s economy” by allowing the exploration in deep water, “because if there is a leak there is no sure way to stopit”.

Promotion of the petroleum industry was “not a smart way to run the economy”, he said.

But Mr Jones, who has clashed with the Greens before over the prospect of mining in Northland and also over the party’s criticism of the fishing industry, said Mr Hughes’ opposition was premature.

“Let the information be uncovered first. It may be that the area is commercially barren, not unlike the minds conceiving that Green rhetoric.”

So this is clearly a Labour Party strategy rather than Shane Jones spontaneously going off the reservation three times in the past month. And it’s pretty smart: Jones is high profile but not on the front bench, so he can’t be seen as speaking for the party. I guess they think this will help him capture one of the Maori seats in 2014. And the Greens can’t really retaliate because they need to promote the idea that the Greens and Labour are a viable coalition partner.

November 10, 2012

Set the controls for the heart of the sun

Filed under: economics — danylmc @ 8:11 am

Fran O’Sullivan puzzles over the Prime Minister’s completely bizarre (non)reaction to the rise in unemployment over the September quarter:

For Key to simply shrug his shoulders on this score doesn’t cut it.

If he was gazumped by the awful statistics, so too were the nation’s economists when official figures confirmed the unemployment rate was the highest it has been since June 1999. “A true shocker,” said Westpac.

Fundamentally you would have to wonder if they have all had their eyes wide shut in recent months while export-orientated companies have cut heaps of jobs in response to more difficult environments overseas.

Key – and the economists who have been caught short by the official statistics – will be hoping the September outturn in the Household Labour Force Survey is a statistical aberration. Westpac has pointed out the survey has a history of throwing up “wild false signals”.

The Reserve Bank was also caught out by the September quarter figures. The central bank has been urged to slash interest rates further in the hope this will depress the value of the NZ dollar, boost export competitiveness and spark firms to hire more workers.

If I understand the new RBNZ Governor Graeme Wheeler – already dubbed ‘Asleep at the Wheeler’ by financial journalists – correctly, he doesn’t need quantitative easing or any other macro-prudential tools because he still has room to cut rates, but he can’t cut rates any further because it would probably lead to increased indebtedness in the household and dairy sectors.

So we have high and rising unemployment, an over-valued currency, very low inflation, our central bank won’t lower rates and it doesn’t want any additional tools to address this situation. The Prime Minister’s reaction is to hope that the statistics are wrong, and keep on doing what he’s doing, which doesn’t seem to be anything. This seems completely insane.

I do wonder if there’s a feedback loop operating here between the Treasury forecasts and the National government. Treasury predict growth, low unemployment and high inflation because there’s a right-wing government in power, and the government reads the forecasts and does nothing, because they don’t need to – prosperity is on the way, Treasury said so!

UPDATE: Matt Nolan has a substantive reply. Short version:

The RBNZ currently believes that, after loitering at a high level for a few more quarters, the unemployment rate will come down sharply.  Furthermore, they believe that current high unemployment IS due to weak demand – so if they could go back in time they would cut rates but RIGHT NOW cutting rates looks inappropriate.

If nothing else, this will be an interesting field trial for central bank independence. Many of the opposition parties would currently direct the RBNZ to act . . . if they could.

November 8, 2012

Turns out scorn is not a growth multiplier

Filed under: economics,policy — danylmc @ 11:19 am

The latest HLFS survey reveals a very high level of unemployment – higher than during the GFC in 2008. And it also reveals that the number of manufacturing jobs in the New Zealand economy declined again during the last quarter.

I find this slightly surprising. Sure, it seemed like manufacturing was in trouble: just about every week saw announcements of factory closures and job losses, and the opposition parties made a very big deal of this in the media and in the house.

But Economic Development Minister Steven Joyce’s reaction to this talk about a crisis in manufacturing was so dismissive, so withering, so contemptuous that I wondered if the opposition parties had over-reached. This was Joyce’s area, he has his vast new MoBIE Ministry to advise him of real-time conditions in the economy. He must know something the opposition parties didn’t.

Well, he didn’t. The manufacturing sector has lost a net 17,000 jobs this year. The opposition was right, and the Minister, for all his mocking, dripping scorn, was dead wrong.

It’s been a bad two days for the government and its claim to be a credible manager of the economy, which means it’s probably going to be a bad couple of weeks for beneficiaries, or whoever else they decide to get tough on as a smokescreen.

Only known color photograph of Tolstoy of the day

Filed under: books — danylmc @ 9:06 am

I didn’t follow the US election too closely, and I don’t have anything interesting to say about the outcome. So here is the only known color photograph of Tolstoy, taken in 1908 when he was eighty years old. When I saw it I thought the photograph looked very modern: the color palate, the slightly saturated light. Then I realised it looks like an instagram picture, so a look I think of is modern is really a digital imitation of a very, very old look.

November 7, 2012

Cognitive bias and self-regulation

Filed under: Politics — danylmc @ 8:50 am

The Prime Minister was asked about Pike River in Question Time yesterday, and the impact of deregulation on the disaster, and he made a statement to the effect that no company is ever going to put profits over the lives of their employees.

Which is true, in the trivial sense that if the Board of Directors is offered a million dollars to kill ten employees they’re (probably) going to decline the offer. But decision making in modern corporations is diffuse. If the mine-safety officer asks for more money to ensure safety, and the CEO goes to his financiers to ask for an increase in operating costs, and they refuse because their risk manager won’t let them put any more money into the venture until revenues improve, then the CEO is unlikely to close down the mine and sack all his staff. Instead he’s going to tell his Safety Officer something like ‘do more with less or I’ll find a Safety Officer that can’.

And the Mine Safety Officer might even something to the effect of ‘I’ll make a cut-back that will make our mine 0.1% more dangerous’. That’s not very much, and the Safety Officer and CEO can agree that they’ll re-implement whatever gets cut when they have the money. Only that day never comes. Instead the operating budget shrinks, the financiers get very unhappy, the CEO’s job and the jobs of all the employees are on the line, and the easiest way to balance the books is to make further tiny incremental cuts in safety, because, after all, nothing bad happened the last time.

All those cuts might add up to a 1% chance of a major disaster per day, which still seems like pretty good odds until you realise that means three to four major disasters per year. But everyone involved is strongly incentivised against coming to that realisation.

John Key’s perspective on workplace regulation is that of orthodox neoliberalism: a business understands itself and its operating environment better than any government department ever can, so will always make superior decisions about how to balance issues like safety vs profit. But that assumes that the people running the business are rational, impartial agents with wide scope to make decisions when they probably don’t have any of those qualities. Any rational, impartial decision makers are going to be employees of a government regulatory body, who don’t have huge financial and emotional stakes in the continued operation of the company.

November 6, 2012

The longer term?

Filed under: economics — danylmc @ 8:09 am

The Herald reports:

Shamubeel Eaqub of the NZ Institute for Economic Research said the latest Barfoot & Thompson figures – which revealed a record average house price of $618,707 – showed most buyers did not think renting was a viable alternative, yet it was better in the longer term.

“Would you buy a loss-making business?” Mr Eaqub asked, pointing out that many house buyers did not factor in the huge losses incurred through paying off a mortgage, maintenance and other expenses.

The NZX had performed on a par with the housing market in the past few years, yet people continued to favour residential property, he said.

Mr Eaqub rents in Wellington and said housing was a particularly bad investment if people examined the amount of money a mortgage and other expenses cost over a lifetime.

Economists don’t like home ownership. It’s an illiquid, non-diversified form of investment that impacts on labour mobility. And in some countries, renting for less than a mortgage and investing the difference makes a lot of sense. Most of my friends in Europe rent properties owned by family trusts, or property management companies who see their rental properties as a long term investment and budget to maintain them in good condition.

But in New Zealand if you’re renting a house, you’re almost certainly renting it off individuals who won’t want to spend any money on maintenance, and will probably sell the house on in a very short time at which point you’ll probably have to move again.

If you’re on a pretty high income you can rent nice apartments or townhouses in the inner-city, sure. But if you have a family and want to live in the suburbs, and you want your home to be insulated, not leak, not have subsidence, have a sense of security because your kids go to the local school, etc, then you have to buy a house.

November 5, 2012

Vacancies close Friday

Filed under: Politics,satire — danylmc @ 9:02 am

New Position

Department of Prime Minister and Cabinet

Are you passionate about the meaninglessness of language, the impossibility of knowledge and the non-existence of reality?

Are you keen to share your  hopeless, doomed skepticism with officials at the highest level of government?

Then you might be our person!

We are seeking a: Senior Epistemologist to join our team in the Department of Prime Minister and Cabinet

 This is one of the three central agencies responsible for co-ordinating and managing public sector performance. Your role will be to brief the Prime Minister and other senior Cabinet Ministers on the uncertainty underpinning all of human existence, especially the uncertainty of managing departments and being accountable for their performance in a universe that cannot be proved to be real.

As Senior Epistemologist you will have responsibilities across – but not limited to – the following areas:

  • Did unemployment rise in the last quarter? How can anyone prove it did, and if they can, doesn’t that proof require an additional proof, and so on into infinity? You will play a key role in communicating the meaninglessness of negative economic statistics to the New Zealand public.
  • Did the Prime Minister say something embarrassing? How can anyone say anything when all experience consists of flawed, subjective memories? What are memories? And aren’t the Labour Party rubbish? Formulating positions on these issues, and then changing that position and denying that the first position ever existed while insisting that the whole thing is just a media beat-up will be a key part of your role.
  • If the Prime Minister appears to have misled Parliament and the public, you will build relationships with key media figures and explain to them that there is no Prime Minister and no Parliament, just probability waves fluctuating within a quantum vacuum, so rumors of leadership struggles in the opposition party are more newsworthy.
  • George Berkeley famously asked, ‘Does the reality of things consist in being perceived? Or is it something distinct from their being perceived, and that bears no relationship to the mind?’ You will apply this doctrine to Official Information Act Requests.
  • You will co-ordinate junior epistemologists and other communications staff to disprove the existence of various events, statements, official reports, statistical findings and scientific facts as the role requires.

Our ideal person needs excellent interpersonal, communication and relationship building skills, and a committed belief in the inadequacy of language and rational thought in understanding the world. Weekend and evening work will be required.

November 3, 2012

Crowd-sourcing racist children’s poetry

Filed under: blogging — danylmc @ 9:05 am

This is one of my daughter’s stuffed toys. The official name for the products is something like ‘Mr Snuggle-bunny’, but my name for him/her/it is ‘The Irish Grim Reaper.’

The Irish Grim-Reaper has a song (naturally), and the first verse goes:

Oh I’m the Irish Grim Reaper

I dance a little jig as I slay

But I’ll let you live

If you pay me one pig

I’ll skip home and drink whiskey all day

But I’m struggling with the second verse. I think it starts out:

Oh I’m the Irish Grim Reaper

I’ve potato stains on my grim robe

I’m not sure what’s next. Something about mud on his scythe? Help a blogger out and submit your verses in the comments.

 

November 1, 2012

Education Minister translated

Filed under: education,Politics — danylmc @ 9:34 am

Hekia Parata is closing a couple of special schools in the South Island, explaining:

At the very heart of this difficult decision lies the opportunity to provide services and support for more children with complex needs in their local community. We can link local services with the remaining residential provision to achieve a more personalised and high quality approach for children and their families. “I am satisfied that this combination of services will make sufficient provision for all children with special education needs both locally and nationally.

I’m pretty sure this means:

The Finance Minister is making me close schools to save money because he promised to reduce the deficit before the next election and I’m closing these ones because teaching intellectually disabled students has a high student/teacher cost ratio, which means I can save more money and have fewer parents mad at me.

Also, I’ve found that if you imagine all of Parata’s statements being said in Ralph Wiggum’s voice (‘I’m consulting widely!’) it lowers your expectations of her to a realistic level.

October 30, 2012

Ayn Rand and Karl Marx

Filed under: Politics — danylmc @ 8:46 am

Toby Manhire wrote about the latest Atlas Shrugged movie the other day, and ended on this note:

For all that, the high-priestess of individualism still has a strong following. “Devotees are mostly American,” says the Economist, but Rand remains popular, too, in Britain, Scandinavia and Canada.

And India, where the Rand “craze” has attracted include well-known businesspeople, footballers, and Bollywood stars. “And – perhaps most gratifyingly of all for those who loathe collectivism and prize the verdict of the market,” says the Economist. “Rand’s books outsell Karl Marx’s 16-fold.”

16-fold seems kind of low to me, since Rand is currently in vogue on the right side of the political spectrum, whereas Marx is really only relevant to political and economic historians. But that stat got me thinking that while Ayn Rand disagrees with Marx on economic issues, politically and philosophically she’s basically a Marxist. You could write a long, not-too-boring essay on this, but briefly:

Rand, like Marx, believes that society is dominated by a parasitical bourgeois class, who produce nothing of value themselves. All value is created by a specific group – for Marx it’s the workers, for Rand it’s Objectivists, ie people who endorse her beliefs – and most is then stolen by their oppressors.

The prevailing social and economic conditions will lead to total systemic collapse (although Rand, like Lenin, believed that an unelected ‘revolutionary vanguard’ could hasten this collapse).

The post-collapse utopia will involve a ‘withering away of the state’, which is the ultimate tool of repression.

Rand grew up in St Petersberg/Petrograd/Leningrad/St Petersberg, and studied history at the university after the revolution, so it’s reasonable to assume this involved a considerable amount of Marxist theory. Obviously her economic beliefs were a reaction against the collectivism of the Soviet Union (just as Marx’s were a reaction against the boom and bust capitalism of Victorian England) but politically she seems to have clung onto the basic precepts of Marxism and embedded them into her work.

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