Mark Steel at the People’s Assembly

There is a new “organisation” called the People’s Assembly which is, essentially, a movement against austerity. I’ve been rather lax in my reading (at least semi-political reading) and blogging recently and so don’t really know much about it. I do, however, think that austerity has been a disaster, both socially and economically, and so – if I understand the motivation behind this movement correctly – I agree with it wholeheartedly.

What I thought I would do is include, below, the speech given by Mark Steel at the People’s Assembly meeting yesterday. It’s both quite amusing and quite fiery. Something that I won’t expand on much here (but is something I may try and write about at a later stage) is why it appears that the most effective rhetoric for those on the left appears to come from comedians, while the most effective rhetoric on the right appears to come from what, I’ll politely call, firebrands. I’m don’t really understand why there is such a difference in style between the right and the left, but it is something I find of great interest. Anyway, enjoy the video.

Wage stagnation and the financial crisis

There was a very interesting and well-written article that I read a little while ago about wage stagnation, rising profits and the financial crisis. I can’t seem to find it again, so if any else knows the one, maybe they could point it out to me. It was about the US, rather than the UK. The basic narrative was that the increasing influence of neo-liberalism and the reduction in union power (and collective bargaining) meant that corporations were (from the 1980s onwards) keeping more of their profits than they had in the past. So, basically profits were increasing as a fraction of GDP while wages were dropping as a fraction of GDP.

So business owners, shareholders and investors now have more capital than they’ve had in the past. Of course they want to do something with this capital which, presumably, they will invest in the financial sector. Their consumers (who are also their employees), however, have less disposable income than they’ve had in the past. So what happens? Well, the financial industry sees all these people who could use more credit and who might like to buy houses. Sub-prime mortgages come into existence and credit becomes easier. People buy their houses and spend their credit on the very products made by the companies who’s profits are rising as a fraction of GDP. These people are, however, also the employees of these companies and their wages are dropping as a fraction of GDP.

So, at this stage corporations are winning on multiple levels. They’re keeping more of their profits than they have in the past (by not increasing wages at the same rate). They’re continuing to sell their products because of the easy credit that this extra capital allows, so they’re able to maintain their revenue streams and continue to extract their profits. Since this credit is essentially their money in the first place, they’re also earning interest on the money being lent to their own employees.

However, there’s a fundamental problem. If people’s wages aren’t rising while their debts are, there’s every likelihood that many won’t be able to repay their debts. Hence the credit crunch arrives when this starts to happen and the financial sector finally realises that the risk associated with the sub-prime mortgages and easy credit is much greater than they had initially realised.

Now, I appreciate that this applies to the US, but I recently saw an article on the Liberal Conspiracy website about wages and profits in the UK. It discusses essentially the same trend, which is illustrated in the figure below which I’ve taken from the article on their site. It’s certainly my view that we should be aiming to reverse this trend if we want to reduce the problems we currently have in our economy and possibly also in our society.

Graph showing the variation in wages and profits (net and gross) since 1960.

Graph showing the variation in wages and profits (net and gross) since 1960 (credit : Duncan Weldon, Liberal Conspiracy).

The intelligent management of the public finances

This is a topic that I have very interesting. It did seem obvious that trying to simply slash public spending may end up being counterproductive. This post seems to confirm that general view, but I’ll need to read it a bit more carefully to make sure I understand what it is saying and to get a sense of where the number are coming from.

The Uxbridge Graduate

Background

Much discussion has surrounded the contention that high public debt levels are associated with low / no economic growth. Specifically,well-publicised research has suggested that if the public debt to GDP ratio exceeds 90% then economic growth will slow down markedly and perhaps come to a standstill. The British government  has eagerly accepted this finding and has used it to justify its debt reduction strategy, which is that cuts to public spending are necessary if the economy is to return to growth. The government has hence proceeded to cut public spending on the promise that the cuts will reduce borrowing and thereby generate economic growth. However, instead of economic growth, the government’s cuts to public spending have coincided with stagnation and recession.  I suspect this is because the spending reductions have been indiscriminate.

The following sets out my view on why indiscriminate cuts to public spending will often increase the…

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The elephant in the room with Lewandowsky

I haven’t been posting much lately as I’ve been busy with other things. I have, however, recently come across this article about the work of Stephan Lewandowsky. He is a cognitive scientist in the School of Experimental Psychology at the University of Bristol. He has published a couple of papers about why some people seem to reject (deny?) many of the findings of climate science. The post that I’m reblogging is reporting on a couple of his papers and suggesting that there is a link between having a libertarian (free-market) ideology and rejecting climate science. If you’ve read any of my other posts, you’ll know I have real issues with the basic tenets of free-market thinking and with those who reject climate science, so this post certainly gels with my thinking and it is interesting that it is based on published work in cognitive science. Doesn’t make it right, I guess, but I would recommend giving it a read.

The integrity of universities

There’s a very interesting (in my opinion) article by George Monbiot in the Guardian today. The article is called Oxford University won’t take funding from tobacco companies, but Shell’s OK. The basic premise is that universities should be acting for the common good, or as George Monbiot puts it


the need for a disinterested class of intellectuals which acts as a counterweight to prevailing mores.


I have to say that I agree completely with this. It has always surprised me how disinterested UK academics can be. I had always assumed that university academics had a role to play in defining what is acceptable in our societies. They are meant to be the intellectual members of our society; the people who think. If academics are reluctant to be involved in this, then who else is going to do it? This isn’t to say that everyone should bow to the views of academics, simply that academics should feel free to question what is accepted in our societies.

There are probably many reasons why UK academics are reluctant to engage in discussions about our society. One may simply be that academics have become very focused. They see themselves as experts in quite specific areas and so don’t see it as appropriate to engage in areas outside their expertise. There is some merit to this, but it is a bit disappointing – in my opinion. Another may be that there is now quite a lot of pressure on academics. Universities have become very bureaucratic and there is quite a strong publish-or-perish attitude. Academics don’t have much spare time to contemplate the merits – or lack thereof – of our societal mores. Universities have also become much more like businesses. The goal is to maximise teaching and research income and, hence, academics are discouraged from doing anything that doesn’t enhance a university’s ability to generate income.

Personally, I think the latter is the main reason why universities (in the UK) are no longer hotbeds of dissent. We are publicly funded and hence need to do what is expected of us. I’m often very critical, for example, of the Research Excellence Framework (REF2014) and even though most seem to agree, the typical response is “we just have to do this”. Well, yes, but do we have to do it happily. If we think it is damaging what we regard as strengths of the UK Higher Education system, shouldn’t we be making it clear that we’re doing it under duress. There’s also this view that we have to do what is best for UK PLC (i.e., what will best help economic growth in the UK). In a sense, I agree with this. What I disagree with is how we’re influenced to do this. University research has, for many decades, had a very positive impact on economic growth. However, this didn’t happen because politicians told universities to do this. It’s because people recognised the significance of some piece of research and used it to develop something that had economic value. It’s also largely unpredictable. It’s certainly my view that telling us to start predicting the economic benefit of our research will do more harm than good.

The final thing I was going to say regards the main thrust of George Monbiot’s article. If there is increasing evidence that global warming is happening (as there is) and if there is evidence that such warming could lead to life-threatening climate change, shouldn’t the universities where this research is taking place act as though it’s important. Maybe universities shouldn’t be accepting funding from oil companies, if their own research indicates that we should significantly reduce our use of fossil fuels. I have heard some argue that we shouldn’t worry about the provenance of our funding as we’ll typically do good things with whatever money we can get. I think this is naive. The idea that one can take funding from oil companies without being influenced by the source of this funding seems highly unlikely.

Niall Ferguson and John Maynard Keynes

Niall Ferguson has been heavily, and quite rightly, criticised for suggesting that John Maynard Keynes’s economic ideas were influenced by his homosexuality and by his lack of children. The idea was that by not having children he was less concerned about the long-term impact of his economic ideas. Niall Ferguson’s claim is, in my opinion, highly offensive and entirely baseless. Niall Ferguson has now, however, produced an unqualified apology. As far as apologies go, this is pretty textbook. No excuses, no attempts to suggest that we needed to understand the context, simply an unreserved apology and an acknowledgement that he was wrong.

Okay, but this doesn’t erase what he has said and even if one can accept the apology, I don’t see how one cannot still conclude that, ultimately, Niall Ferguson is homophobic and that one should be careful about how seriously to take any future comments that he makes.

This reminded me, for some reason, of something I heard on the radio yesterday. The comment on the radio was that the Tory party would have to convince voters that they weren’t privileged and that they weren’t out-pf-touch with regards the realities of life in the UK. The first thing I thought when I heard this was that surely the only way they could do this was by lying. It’s fairly clear that a majority of leading Tories are extremely privileged and have lifestyles very different to the lifestyles lead by most in the UK.

The Tories could try to convince voters that despite this they can still govern in a way that would be acceptable to most and that their policies will be aimed at making the country better for all, rather than simply for those who are privilege like themselves. This is very different to convincing voters that they aren’t privilege and out-of-touch, but at least it would seem to be honest.

I guess, what struck me was that we now live in a world where people feel that they have to say what they think others want to hear. In a sense, I would rather that people were more honest. That’s not to say that I want to have high-profile people who are homophobic or government leaders who are openly dismissive of people who are not as privileged as they are. What I would like is to know what people really believe so that we can make informed decisions about who should be “allowed” to have a high-profile role in society. The media can choose not to give a platform to those who are openly homophobic (for example) and we can choose not to elect those who, deep down, don’t really wish to run the country in a manner that would be optimal for the majority. I know this is naive and simplistic, but I guess – to be honest – that’s probably what I am.

Richie Havens

I have just discovered that Richie Havens has died at the age of 72. He was famous for being the opening performer at the 1969 Woodstock Festival. I was aware of this, but didn’t really follow much of his later career. I have, however, seen his Woodstock performance and found it incredibly powerful. I thought I would post it below in case some have never seen it.