Category: Economics

Magical Thinking

On By Nicholas AlexanderIn Brexit, Covid-19, Economic disaster, New articlesLeave a comment

Mathematics is concerned most often with certainties. If x plus y equals z, then 2x plus y equals zx. That sort of thinking is not arrogant, it is simply one way or the other.

Magical thinking believes that given a few little tweeks you can make 2+2 equal what the hell you want it to be, and for Americans, at this critical juncture in history, over half want it to mean an end to the president’s continuous distortions of the truth to benefit himself, and a return to more honest leadership in their interests.

But thinking that more of the same is somehow going to change the future because bad luck can not rule forever is simply fanciful. The facts are stark, Trump has led America into the death of a very significant number of people, and the injury to the lives of possibly more by being too optimistic about a virus as though he could somehow negotiate with inevitability and look good because he predicted it would magically go away. Unfortunately his misdirection backfired and the killed 132,000 Americans. That number is not going to magically reduce, it will inexorably increase. And he is proud of his record! Look how great he is! It is painfully obvious he is damaging the USA more seriously than any person in the last two hundred years. And yet, 30% or so will still vote for him, even as their family members die because they attended a Maga rally.

Magical thinking also infects the Government of the UK. Believing that this crisis is over when there are still 500 new infections in a day, because it is not at the level it was, is a failure to understand the mathematics of viral spread. 500 new infections means that there are well over 100 hotspots where he virus is not contained. 500 can be doubled to a nice round 1000, and then if the R rate jumps to 2, the number of infections returns to 8,000 in a couple of weeks. Rationality is to get the infection rate down below 10, then you have more time to control any pockets of infection.

The virus has mutated, mainly due to the unrestrained infection rate. Every person infected adds genetic information to the virus, and increases its chances of survival in our bodies. The mutation makes the virus more contagious. The only way we can control it is to reduce the pool of bodies it currently infects to those in hospital, and no others.

The other terribly difficult issue is if the progress of the virus is not defeated and the UK crashes out of the EU without a trade deal at the end of the year, poverty will become more widespread. Poverty is the best friend of the virus – desperate people still need food, but can not isolate so easily.

So the luxury of being able to open up early is magical thinking and it will prolong the economic damage into next year when the threat of more expensive food imports will destroy the lives of a larger percentage of people who simply have debts: student loans, mortgages, vehicle loans, and most significantly, credit cards, leveraging their ability to pay and support themselves in the face of extended lockdowns and economic false starts.

No, Mr Johnson, and Mr Cummings. Your machinations are like Mr Trump’s. Magical thinking. And it will be the ruin of many average people.

Tory backbenchers who support Johnson’s insane government, beware. Your constituents will become increasingly aware you did nothing to prevent the most destructive Government in the UK’s history from destroying their lives.

Also read …

The Guardian on Brexit in the Covid-19 era

Automation and the Dangers of Populism

On By Nicholas AlexanderIn economic revolution, Economics, New articlesLeave a comment

Automation should allow us to extend and redefine productivity. Vending machines replace people in banks and for certain products. Banking is now more productive than ever but do we measure industry by how efficient it is or how many people it employs?

Redefinition of goals – instead of ‘job for life’ for some it has become ‘passive income’ or ‘my own business’ for many whilst unemployment and benefits may be necessary to fill in gaps, families coming together to support young families will become the new normal.

Politicians can not be expected to solve this or many problems for us, they are there to set the framework of laws, not rescue us from ourselves.

The economy belongs to us, they are there to take some of it and provide public services. Politicians are not going to rescue airlines or banks from economic evolution. That is the lesson populism and isolation will learn hard. That is what is wrong with this wave of out-of-date thinking from the likes of Trump and Brexit, it will kill people who matter to other people, but people who are merely statistics that embarrass the government.

We expect politicians to be able to do something about it, our reaction is understandable, but they can’t. We pay lawyers ridiculous amounts to defend our inadequacies regardless of the fact that half of them have to lose. The economics of failure are not well understood, but they are there. Governments set a direction, but it is up to the people to innovate. Conservatism has been lost in the dense haze of populism.

And Left-wing thinking has been branded ‘socialism’ and therefore ‘wrong’. The Left-Right dichotomy was out of date but has been perverted by populism and idiotic thinking, masked by lies and confidence in the domination of others.

Prejudice and Influence

On By Nicholas AlexanderIn Brexit, Covid-19, economic regression, New articlesLeave a comment

No 10 defends the activities of Dominic Cummings, a right-wing promoter of extreme Brexit and source of this Government’s most extreme ideas at the Science guidance body Sage, where two members have complained that Cummings has been more than an observer but has directed the course of discussion to suit his own pet theories.

Hence, we believe that the policy of seeking ‘herd immunity’ and not counting deaths in the community or care-homes, has come directly from this advisor to the PM. This self-satisfied feedback mechanism has no place in forming policy: it is nothing but reinforced prejudice and has caused the UK to be the worst country in the world for managing this pandemic. Cummings and his role are directly responsible for the brutal course the UK has taken.

The economic fallout will go on for years. The social damage of overwhelming the NHS on one hand and ignoring the massive overflow of patients who could not be saved, on the other is effectively genocide by inaction. It is the disabling of expertise through interference and influence.

Britain is one of the most tragic offenders of cheating the greater population from the benefits of taxation.

Hiding real statistics, making false statements and pursuing nihilistic and hypocritical goals makes this Government both cruel and heartless, complicit in damaging the fabric of the society it pretends to support and enables massive and legalised tax fraud.

Let’s hope that a near-death experience allegedly suffered by Boris Johnson has woken up his conscience and informed him of the dangers of pursuing the course of his Government has taken thus far.

Austerity ended up being more expensive than maintaining social services.

Is an economic crash imminent?

On By Nicholas AlexanderIn EconomicsLeave a comment

There are predictions of a recession, a belief that countries should be concerned about their irredeemable net values, the soaring unreality of printing currency so that your appearance can be stretched just a little bit thinner.

The trouble with inflation is the reduction of value. The benefit of inflation is that there is enough to go around when there is growth. Growth without inflation is hard, inflation without growth is what happens when nothing happens, a bit like you dipping into your credit card every time there is a financial idea.

The race condition between value and productivity should be consistent and the pressure that keeps these values entwined are not just basic needs, but intertwined complex interdependencies that multiply into many new dilemmas.

The only real political fuel there can be is hope. Behind every drive of the knife is a hope to create a set of conditions that determine the future history of a country. Democracy requires reality, or it may result in a kleptomaniacal desire for power.

Tower in Flames

On By nalexanderIn Austerity, DemocracyLeave a comment

That the building industry thought that it was not risky to clad a high rise apartment block in flammable cladding is frightening enough. You may hope that it was mere oversight how many councils decided that the look of a building trumped the safety factors and not just clad their building in a pre-packaged instant disaster, but now are leading in the race to become of most productive in the calculation of terror.

That Governments implicate themselves by bonfires of regulation to allow businesses to do whatever they felt could be acceptable risk. It was not just trying to make things look better by covering these buildings with a flammable cosmetic. It is building in vapid negligence of safety regulations.

The non-flammable may be more expensive prior to the first fire. Now, perhaps it should be the only option on the market. The fifth tallest skyscraper residence, in Dubai, all 89 stories of it evacuated without even a single injury.

The money they spend on this edifice to structured living with unnecessary luxury, a concentration of wealth so desperately crammed together, these “homes”. Unbridled luxury or high rise poverty, the destruction of homes is the most terrible fear.

Notwithstanding, the safety record of that building compared to Grenfell, and witness now the Governments of the world have failed to regulate for safety due to budget constraints. That’s one terrifying omission. We want Governments to remove regulations that expose our lives to risks that can be avoided? The difference to less flammable classing for at least 80 dead people was only £300,000 at Grenfell. It would have been more on this and the 30,000 other risk clad buildings in the Middle East. Just think, the masses live in Tinderboxes at the dawn of the age of global warming. Good plan? Leadership? Or just an illustration of something more sinister? Human greed seems to create blindness to consequences of broadly shared risk. The owners of these buildings have a problem. The risks their designs pose to insurers and the risk of the loss of life and the loss of living. Cramped quarters are still someone’s digs. 80 stories of people Losing everything is tragic, but it is not as criminal as they at least got everyone out.

Religion and Extinction

On By Nicholas AlexanderIn economic revolution, Economy, Environment, Politics, religion, WarLeave a comment

We are different to any other species in that we have evolved what we call economics, science of extending survival. Or is it a massive inter-generational war that the current political generation are guilty of, increasingly responsible for causing environmental collapse.

Why do we measure progress by growth? When we solve that one, and measure progress with an economics that includes compounding interest for any future consequence of our indulgence.

Only then we can call ourselves good Christians or good Muslims or good Jews. We remain greedy and primitive in our mutual interests. Why think like this?

Part of the lesson of certain matters remaining secular and out of the control of the driving faith or the possessors of property or the military – but that the ultimate control must remain honestly in the hands of the people. So we have countries for that. But faith is a personal matter and your path to your saviour or prophet is a relationship between your self and something all powerful. Therefore when you are praying together it is as though a casting of individual threads to your personal heaven is a revelation to the self, not to the army, not to the workforce, not to the merchants, the bankers or even the holy ones we listen to preach their secret messages in sermons to the initiated. In all religions there seems to be a strata that pulls people up – spirituality is a wonderful thing, don’t get me wrong.

Having to take sides for your whole life is the commitment of belief. But the essence of individuality is the thing. It is the most important and elusive thing. Your thread can vibrate within a group but it can also find its own pattern. It does not matter. If we align beliefs into destructive paths then as a group we start to consume that which we have no right to, we take that we have to leave alone. The first lesson in The Book of Genesis was not to take the forbidden fruit from the tree of knowledge or die. Not to take the irreplaceable fruit means we must consider requirements of future life in our consumption.

The ways in which competing religions have interpreted this basic tenet of their own belief is astounding. The destruction of species is wanton, selfish and will result on our own death.

These words or wisdom are drowned by the clash of battle as we fight for our set of beliefs. But this fundamental exists. If we sow extinction, then we will become extinct. I am just not sure if today’s political science really gives a damn about the future.

The Greenhouse Treaty

On By nalexanderIn Climate Change, Economics, Economy, Global WarmingLeave a comment

China and America have agreed to targets for reduction in greenhouse gas emissions by 2025 for America, and 2030 for China. On the scale of problems, China is a significant player, with a much larger population competing for resources as economic growth strides into the greener parts, its lungs, pollution is rife, significant and horrendous to the increasingly aware population. It is they who are served by a mutual accord of the current world leaders. Both have already made history.

China’s pollution is evidence of a population growing too fast. Economic growth is reflective of a certain attitude to risk. Countries are examples to each other of how to do it or how to do it all wrong. Overheated economies destroy our habitats. The solution is not war, economic war or invasion. It is much easier than that.

According to World Bank figures for 2010 – 2011, developed nations afford to include the exponential cost of environmental damage, on the index the UK is about 20. China is 60. But compare that to Botswana, at 199. The problem is not China. It is the misuse of resources and the rape of land by too many competitive hungry humans. We have to evolve to stop killing our future.

We can do this by simply changing our thinking. Our economic system needs to evolve into one that is geared to reward economic contraction. Our religious beliefs need to encompass a new spiritual path that includes a respect for all life and ones descendants who are as much us as we are our ancestors.

Todays comments

On By Nicholas AlexanderIn Economy, PoliticsLeave a comment

A few Disturbing Trends with our comments in The Guardian:

7 Aug 2014

Boris Johnson’s bid for parliamentary return in 2015 leaves Tories divided

The true blue conservative denies they are running until the finish line is in view, their competitors unprepared, relaxed and busy elsewhere can then make a huffing and puffing dash for the main prize.

Salmond rallies SNP backbenchers after independence debate

If the UK had a government which paid a little more than latent lip service to the parts of the country that are not London, I really wonder if the Scots would fight for independence. The popularity of this possibly economically difficult endeavour is an indictment of the Coalition and the unfair lot dealt to the many to enrich the very few.

Democracy will finally defeat that act of “mentalism”. But the question, what options do we really have? That question is the emotional argument that precedes this revolution.

Of course we may be “better together”, but the majority have to ask “better for whom?”

NIESR says economic recovery slowing after weaker manufacturing figures

I fear that like the previous government’s folly with the city, and the horrors of the 70s recessions, that it is “shock” that suddenly causes fragile recovery to be history and disaster to be the sounding board for electability. It is “old thinking” that is still leading economic planning and reactivity to timebombs that manufactures “heroes”.
In other words you are so brilliantly right. Open your business to the world. Dependence upon “economic growth” (based on the value of assets) is simply not getting us anywhere.

Sorry, George but increasing London property prices is not economic growth. You got to create industries, cause people to invest in and start new ventures, be willing to take risks.
Worrying about interest rates and the resale value of your nest egg stultifies imagination and reduces the rationale for business growth. It is not just investment bankers having dosh, it is the actual activity that seems to be faltering.

6 Aug 2014 – on Martin Rowson’s cartoon on Lady Warsi’s resignation

Being “right minded” seems to be a qualification. Or is that encoded tory propaganda or merely ukip splashing about in puddles?

Or that vacancy leading the Liberal Democrats, he may have to resign also.

…governments that pendulum swing between building and destroying systems – how much waste that does that create? Democracy under First Past the Post is truly the most inefficient system, especially when it is polarised between opposite sets of values. Proportional representation is more effective as they get to be far less adventurous as their mandate is less total.

EU Elections

On By Nicholas AlexanderIn Economics, PoliticsLeave a comment

The European Parliament is a government body that decides upon the laws that join our people together. Issues like human rights. It is infected by “protest parties” who are only there to act as dead weight opposition but what is what achieving other than making the government of the EU less effective?

A strong UK voice in the European Parliament is a no brainer. Of course we need the best representation possible and make an effort to make the whole of Europe more and more prosperous.

Pollution

On By Nicholas AlexanderIn Climate Change, Economy, pollutionLeave a comment

Pollution threatens all life. Man made pollution is the result of the industrial revolution and growth. Or it is the result of criminal expansionism?

Pollution is the addition of artificial byproducts from unclean industrial activity to a natural environment, too often with unforeseen consequences, or worse, known but hidden consequences. One of the pollutants we continue to add to the precious atmosphere is CO2. Unfortunately for us, there are many others. In the short term, we are most threatened by the consequences of CO2, but who knows what other accumulations of poisons in the food chain may cause breaks and starve us to death first.

For example, our chemical warfare on “pests” that seems to have a side effect of bee eradication, may be the end of us before lower Miami is fully under-water from sea rising with the melting ice-covers of Antartica and Greenland. That is ice above the land not, which when it is water will displace the coastline and reshape the British Isles. Is that how much we care about our countryside?

See also:
George Monbiot – Why we couldn’t care less about the natural world

Captain Sunshine