The Dim-Post

May 28, 2013

Epic dissent of the day

Filed under: economics — danylmc @ 8:42 am

Matt Nolan takes (strong) exception to this post and graph. I hope to respond when I find time, and courage.


  1. Defniitely not meaning it to be personal – and I’m sorry if it came across that way. There is just a deep seated sense of frustration about the issue that overwhelmed me 😉

    Comment by Matt Nolan — May 28, 2013 @ 8:55 am

  2. Arguing around the margins doesn’t change the central thrust of Danyl’s comment – that unless we reverse our slow slide into a sharply divided Latin American style society with a low value elite of rent takers sitting atop a pile of peasants, we are in the shit.

    Comment by Sanctuary — May 28, 2013 @ 9:38 am

  3. Certain irony in this line..

    “If this is really how people are thinking, economists need to do a better job of publicly describing what is going on with our NIIP.”

    ..given that I have no idea what NIIP even stands for.

    (I suppose this is not a problem for his regular readers have)

    Comment by repton — May 28, 2013 @ 9:51 am

  4. I have no idea what an NIIP is.

    Comment by Steve (@nza1) — May 28, 2013 @ 10:20 am

  5. It’s in the title of the chart Danyl and Matt are talking about. Net International Investment Position. Seriously, it’s right there.

    Comment by Vanilla Eis — May 28, 2013 @ 10:23 am

  6. Ah! The global knights who say NIIP!

    Comment by Sanctuary — May 28, 2013 @ 10:56 am

  7. Well we will NIIP ignorance in the bud then.

    Comment by xianmac — May 28, 2013 @ 11:44 am

  8. I suspect ignorance of this economic issue is just the NIIP of the iceberg … .

    Comment by Andrew Geddis — May 28, 2013 @ 12:22 pm

  9. Steve, a NIIP comes up about this time each year. Do you not remember your Nan saying “there’s a NIIP in the air”?

    Comment by Clunking Fist — May 28, 2013 @ 12:58 pm

  10. NIIPs, tatters and corned beef is, I believe, one of Don Brash’s favourite meals. Coincidence? I’ll leave that for you to decide.

    Comment by Sanctuary — May 28, 2013 @ 1:57 pm

  11. I sense an inappropriate joke about the Japanese economy in here somewhere…

    Comment by Gregor W — May 28, 2013 @ 3:22 pm

  12. I’m confused about exactly who is tweaking whose NIIPs?

    Comment by Ben Wilson — May 28, 2013 @ 3:36 pm

  13. Reading Matt Nolan just makes me more dispirited with the line our centre left politicians are giving us on our economic problems.

    I know its difficult to present complex arguments but i can’t see any attempt to try. And it’s supposed to be the reality-based community.

    Instead we get the line that our problems are all caused by greedy conservatives who give money to the rich and for some reason deliberately keep our exchange rate high combined with neoliberal austerity.

    And yet the solution they’re proposing includes cutting super – well isn’t govt spending supposed to the solution – and if it so easy to bring down the exchange rate then where is the guarantee that they will bring it down to a particular figure?

    I’d listen to Parker a bit more if he was more upfront about the difficulties we face and that three are no easy solutions.

    Comment by NeilM — May 28, 2013 @ 4:05 pm

  14. NeilM,

    Indeed. Its called lying. I suggest you dont read too much of Matt Nolan lest you lose all respect for politicians to the point of living in a perpetual state of anger..

    Comment by swan — May 28, 2013 @ 8:27 pm

  15. Ffs you guys are so out of touch you should be green politicians

    Comment by petey — May 28, 2013 @ 8:50 pm

  16. There is some arguing around the margins, and some credible argument that the graph presented without qualifiers may overstate the problem. If we’re somehow able to make use of asset bubbles by selling on the peak, as he seriously suggests the nation will do, then it overstates it further. When international interest rates increase again, it will probably understate it.

    But Nolan is angry is because:

    I don’t give a crud about that, as NIIP is not a target, just like productivity isn’t a target … the government isn’t a frikken business manager.

    That’s it.

    Things like balance of payments, productivity, and our NIIP are considered serious policy issues in pariah states like Australia and the UK. They’re perfectly normal in advanced economies. Nolan is ideologically opposed to our governments having a role in shaping our society, and so the idea is offensive.

    Comment by George D — May 28, 2013 @ 10:18 pm

  17. Yeah George D. And in those countries the lump of labour fallacy is not accepted by politicians. The demand effects of minimum wages and the efficiency effects of a messy GST are not part of the public discourse. Consideration of the liberty of adults to take recreational drugs is not part of the debate.

    Oh and politicians lie/deflect/obfuscate in those countries too.

    Sooo… whats your point?

    Comment by swan — May 29, 2013 @ 7:51 pm

  18. Actually, there are debates in serious circles on all those issues in Canberra. I don’t know what people talk about in London, or other capitals around the world. But I take the liberty of assuming that their online newspapers, blogs, and academic journals represent a section of their political classes, and thus those issues are indeed discussed.

    My point was that Nolan attacked the graph as not fully representing the problem, which may be fair. He talked down the impacts of a large NIIP (in ways which may or may not convince). He then moved to his real argument: that discussing it as a matter of government policy was illegitimate. That’s what’s what caused the anger.

    Comment by George D — May 29, 2013 @ 9:20 pm

  19. “I sense an inappropriate joke about the Japanese economy in here somewhere…”

    Actually I was surprised Spike Milligan hadn’t been quoted yet…

    Comment by Grant — May 29, 2013 @ 9:34 pm

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