Making Suspicious Minds Mandatory

Criminalising people who fail to report suspicions of child abuse will poison social relations

By FRANK FUREDI

People often respond to events that distress or shock them with the statement ‘it should be a crime’. My grandma, for instance, was convinced that extramarital affairs should be a crime. In recent decades the phrase ‘it should be a crime’ has been regularly repeated by a chorus of unofficial organisations zealously committed to intensifying the policing of human behaviour. Like many a traditionalist grandma, they enjoy converting their prejudices into policy advice. But unfortunately, unlike my grandmother, these moral crusaders actually have the power to influence public policy.

This week it was the turn of Keir Starmer, the former director of public prosecutions (DPP), to issue the call, ‘it should be a crime’. Speaking on the BBC’sPanorama programme, he argued for the criminalisation of people who did not report suspected child abuse. Panorama, which has come to embrace the reality-television format, now serves as a powerful vehicle for the cultivation of moral outrage. The influence of the show is demonstrated by the fact that its message immediately becomes a major subject of discussion in the wider media.

Unlike many demands for the criminalisation of behaviour, Starmer’s call for the mandatory reporting of suspicions of child abuse does not aim to punish people for what they have done. Its aim is to persecute certain professionals for something they have not done, those, that is, who have failed to act in accordance with the ethos of the current obsessive regime of child protection. The demand to criminalise individuals who do not report their suspicions is justified on the grounds that it will curb the activities of future Jimmy Saviles. ‘Without a change in the law, there’ll be another Savile’, argued Starmer. (These days the very mention of Jimmy Savile usually serves as a prelude to the demand that something ‘should be a crime’.)

The institutionalisation of the mandatory reporting of suspicions will do nothing to help children preyed upon by paedophiles. After all, there is no shortage of reporting such suspicions to a diverse range of institutions. Most social-work professionals acknowledge that the child-protection system is already overloaded with far more cases than it can properly handle. As matters stand, the flood of such reports already means that it is difficult for authorities to make important distinctions between the relatively trivial cases of neglect and the really serious threats facing children. Moreover, those demanding the mandatory reporting of suspicions overlook the fact that in the relevant institutional setting, people already have a duty to report their suspicions. As Professor Eileen Munro, a government adviser on child protection, noted, ‘the debate around mandatory reporting creates a misleading impression that people don’t already have a duty to convey maltreatment if they have any suspicion of it’.

Europe and the Zero Bound

As in the U.S., another rate cut isn't enough for faster growth

The European Central Bank turned heads by cutting its benchmark interest rates by 0.25 percentage points on Thursday, though calling it a dovish move would imply that the ECB has been hawkish. The main refinancing rate sat at 0.5% for six months before this week.

The best argument for a rate cut is that euro-zone inflation has been falling all year and came in below 1% in October. The central bank's sole mandate is price stability, which means preventing excessive price changes in both directions. ECB President Mario Draghi made clear Thursday that the lower inflation outlook was the most important calculation behind the rate cut. The central banker has refused to pretend that a 25-basis-point cut in banks' refinancing rate is the difference between euro-zone salvation and damnation, which can't be said of some commentators.

Mr. Draghi also dismissed fears that low inflation is about to turn into a deflationary spiral. Not long ago, moderately improved business surveys were supposed to presage a strong European revival. Now, "dangerously low" inflation is said to threaten the recovery.

As Mr. Draghi pointed out, recent low inflation is due in large part to stable food prices and falling energy prices, as well as the effect of previous VAT increases dropping out of the data. But even a proper, prolonged dose of low inflation wouldn't be the worst thing for Europe.

Inflation has been falling most in euro-zone countries where wages have been falling most, which is good for real household income and consumption in those countries. The one euro country experiencing out-and-out deflation is Greece, where relative price adjustment has been a stated goal of crisis resolution.

A weaker euro will be a boon for German exports, which the U.S. Treasury and others blame for holding back euro-zone recovery. The new government in Germany isn't about to open its spending floodgates, which is what European Keynesians are really demanding when they complain about insufficient German "demand." The better complaint is that Berlin won't cut taxes, which would lift German growth and thus its demand for other countries' exports.

Tales From the Brussels Crypt

Harassed and Bossed Around by Bureaucrats

By Pater Tenebrarum

The bureaucrats in Brussels treat the citizenry of the EU like a gang of small children that needs to be kept in check by benevolent overseers. Their most recent strikes all aim at allegedly 'saving the planet' while slowly but surely rolling back the blessings of civilization.

Naturally, most people are barely aware of what is happening. After all, who has the time to actually look through a 60 pages long document entitled “Development of EU Ecolabel Criteria for Flushing Toilets and Urinals”? Mind this is just a 'working paper', but you can already guess what the end result will be. Toilets all of a sudden won't flush properly anymore. The filthy toilet plunger, long thought to be an instrument used only in the gravest of emergencies, will have to be employed on a regular basis. Taking a shower will suddenly feel like standing in a weak drizzle. Very few people will know what happened of course, but everybody will be aware that the quality of life has declined by a notch. 

If people were to sit down in the morgue-like lighting provided by the expensive and highly poisonous 'energy savings lamps' EU citizens are forced to use these days instead of the trusty incandescent light bulb, and took the time to read through various EU directives, they would realize that their non-working toilets and weak showers are the work of bureaucrats in Brussels. As the latest 'working paper' indicates, things are about to take a turn for the worse. Under 'proposed criterion' we read that 

“The full flush volume, independent of the water pressure, of flushing toilet and flushing urinal equipment, when placed on the market, shall not exceed the value presented in Table 2.” 

So how much water are citizens going to be allowed per flush henceforth? 6 liters – that is 1.58 gallons. In times of yore, a good toilet flush was accomplished with 5 gallons, or roughly 20 liters. Plunger? No-one ever had to think about that filthy appurtenance much.

Of course not a drop of water will be saved by having only 1.58 gallons per flush available either, because it means one must flush 3 or 4 times before the business is done. All that is going to happen is that citizens will have to relinquish enjoyment of the full blessings of one of the most important advances of civilization: indoor plumbing.

America's Ruling Class

And the Perils of Revolution

The only serious opposition to this arrogant Ruling Party is coming not from feckless Republicans but from what might be called the Country Party -- and its vision is revolutionary. 

By Angelo M. Codevilla

As over-leveraged investment houses began to fail in September 2008, the leaders of the Republican and Democratic parties, of major corporations, and opinion leaders stretching from the National Review magazine (and the Wall Street Journal) on the right to the Nation magazine on the left, agreed that spending some $700 billion to buy the investors' "toxic assets" was the only alternative to the U.S. economy's "systemic collapse." In this, President George W. Bush and his would-be Republican successor John McCain agreed with the Democratic candidate, Barack Obama. Many, if not most, people around them also agreed upon the eventual commitment of some 10 trillion nonexistent dollars in ways unprecedented in America. They explained neither the difference between the assets' nominal and real values, nor precisely why letting the market find the latter would collapse America. The public objected immediately, by margins of three or four to one.

When this majority discovered that virtually no one in a position of power in either party or with a national voice would take their objections seriously, that decisions about their money were being made in bipartisan backroom deals with interested parties, and that the laws on these matters were being voted by people who had not read them, the term "political class" came into use. Then, after those in power changed their plans from buying toxic assets to buying up equity in banks and major industries but refused to explain why, when they reasserted their right to decide ad hoc on these and so many other matters, supposing them to be beyond the general public's understanding, the American people started referring to those in and around government as the "ruling class." And in fact Republican and Democratic office holders and their retinues show a similar presumption to dominate and fewer differences in tastes, habits, opinions, and sources of income among one another than between both and the rest of the country. They think, look, and act as a class.

Although after the election of 2008 most Republican office holders argued against the Troubled Asset Relief Program, against the subsequent bailouts of the auto industry, against the several "stimulus" bills and further summary expansions of government power to benefit clients of government at the expense of ordinary citizens, the American people had every reason to believe that many Republican politicians were doing so simply by the logic of partisan opposition. After all, Republicans had been happy enough to approve of similar things under Republican administrations. Differences between Bushes, Clintons, and Obamas are of degree, not kind. Moreover, 2009-10 establishment Republicans sought only to modify the government's agenda while showing eagerness to join the Democrats in new grand schemes, if only they were allowed to. Sen. Orrin Hatch continued dreaming of being Ted Kennedy, while Lindsey Graham set aside what is true or false about "global warming" for the sake of getting on the right side of history. No prominent Republican challenged the ruling class's continued claim of superior insight, nor its denigration of the American people as irritable children who must learn their place. The Republican Party did not disparage the ruling class, because most of its officials are or would like to be part of it.

A World Split Apart

Commencement Address Delivered At Harvard University, June 8, 1978

By Alexander I. Solzhenitsyn

I am sincerely happy to be here with you on the occasion of the 327th commencement of this old and illustrious university. My congratulations and best wishes to all of today's graduates.

Harvard's motto is "VERITAS." Many of you have already found out and others will find out in the course of their lives that truth eludes us as soon as our concentration begins to flag, all the while leaving the illusion that we are continuing to pursue it. This is the source of much discord. Also, truth seldom is sweet; it is almost invariably bitter. A measure of truth is included in my speech today, but I offer it as a friend, not as an adversary.

Three years ago in the United States I said certain things that were rejected and appeared unacceptable. Today, however, many people agree with what I said . . .

The split in today's world is perceptible even to a hasty glance. Any of our contemporaries readily identifies two world powers, each of them already capable of destroying each other. However, the understanding of the split too often is limited to this political conception: the illusion according to which danger may be abolished through successful diplomatic negotiations or by achieving a balance of armed forces. The truth is that the split is both more profound and more alienating, that the rifts are more numerous than one can see at first glance. These deep manifold splits bear the danger of equally manifold disaster for all of us, in accordance with the ancient truth that a kingdom — in this case, our Earth — divided against itself cannot stand.

There is the concept of the Third World: thus, we already have three worlds. Undoubtedly, however, the number is even greater; we are just too far away to see. Every ancient and deeply rooted self-contained culture, especially if it is spread over a wide part of the earth's surface, constitutes a self-contained world, full of riddles and surprises to Western thinking. As a minimum, we must include in this China, India, the Muslim world, and Africa, if indeed we accept the approximation of viewing the latter two as uniform.

For one thousand years Russia belonged to such a category, although Western thinking systematically committed the mistake of denying its special character and therefore never understood it, just as today the West does not understand Russia in Communist captivity. And while it may be that in past years Japan has increasingly become, in effect, a Far West, drawing ever closer to Western ways (I am no judge here), Israel, I think, should not be reckoned as part of the West, if only because of the decisive circumstance that its state system is fundamentally linked to its religion.

How short a time ago, relatively, the small world of modern Europe was easily seizing colonies all over the globe, not only without anticipating any real resistance, but usually with contempt for any possible values in the conquered people's approach to life. It all seemed an overwhelming success, with no geographic limits. Western society expanded in a triumph of human independence and power. And all of a sudden the twentieth century brought the clear realization of this society's fragility.

Datagate and the Death of American Liberalism

The Bolshevik Left Loves the NSA

By Justin Raimondo

The widely noted poll showing Democrats are now the biggest cheerleaders for the Surveillance State has conservatives delightedly calling out the left for “hypocrisy,” noting with glee the leftie pundits who denounced George W. Bush’s administration for trampling on our civil liberties and are now defending the Regime against the Snowden - Greenwald revelations . Their liberal targets come out swinging, however, rightly pointing out that that PRISM and the phone collection program originated under George W. Bush’s watch, back when all these born-again civil libertarians of the right were either silent or supportive of these measures.

Indeed, the left has gone on the offensive, crowing that what Edward Snowden calls the “architecture of oppression” is all perfectly legal, pointing out that the NSA went through the FISA court – a secret “court” whose orders are classified top, and that, out of thousands of such requests, has only denied the government a grand total of 11 times. This left-right dynamic dramatizes the symbiotic relationship between authoritarians on both sides of the political spectrum – and, perhaps, explains how the Panopticon unveiled by Snowden came to be built and legitimized.

The Difficulty of Defining Terrorism

The real threat is the ever expanding definition of terrorism 

by Greg Weiner 

Last week’s awful tragedy at Los Angeles International Airport, which by all accounts involved a lone and troubled individual, was notable for the commendable calmness surrounding it. There were no calls for military detention, no cries of “act of war,” no demands that the President intervene to prevent the accused, Paul Ciancia, from “lawyering up” such as were heard in the aftermath of the Boston Marathon bombing. But the act itself is difficult to distinguish from what, in other cases, is described as terrorism that supposedly exceeds the competence or jurisdiction of civilian authorities. It was politically motivated: Ciancia’s writings were laced with anti-government sentiment. It was an explicit attack on government agents in the performance of their duties. It terrorized civilians.

A gut check, of course, tells us the difference: This individual may have been mentally ill. There is no evidence of connection to foreign groups. Yet these are things we know after investigation. By outward signs, consistency ought to have impelled the same people who wanted Dzhokhar Tsarnaev militarily detained immediately after the Boston Marathon to call for the same treatment after the LAX tragedy. We do not know, after all, that the same qualities—mental illness, home-grown terror rather than foreign instigation—do not apply to Tsarnaev; certainly we did not know it in the instantaneous aftermath of the bombing when calls for enemy-combatant status were being heard.

Welcome to the New Corporatism

What underlies America’s unforgiving disdain for its political class?

By SAMUEL GREGG 

To state that Americans are deeply disillusioned with their political masters, whatever their party, is surely the understatement of 2013. A recent Pew survey, for example, indicated that just 19 percent of Americans trusted the Federal Government “to do what is right just about always or most of the time.” That’s an all-time low since polling began on this issue in 1958. It’s especially telling that the same survey informed us that Congress is even more unpopular than the IRS! Indeed, as the study’s authors write, “A record-high 74 percent of registered voters now say that most members of Congress should not be reelected in 2014.”

Such polling should always be taken with ample pinches of salt. The incumbent reelection rate in America, for example, is extremely high. That’s partly explainable by gerrymandering. But it also owes something to many Americans’ willingness to exempt their particular representative from more general condemnations. “All members of Congress are you-know-whats… except mine.”

That said, the sense that elected officials today aren’t especially concerned with the common good or — more basically — simply can’t be trusted is palpable throughout America. Obviously, elected officials don’t help themselves when they make significant promises that are later disregarded. Leaders who say, for instance, that they just aren’t into nation-building (but then try to manufacture Western-style democracies in Middle-Eastern Islamic countries), or who claim that “if you like your plan, you can keep it” under the Affordable Care Act (only to see millions of Americans now losing the health-insurance they liked), don’t help to build confidence between the governed and government.

There is, however, another dimension to this problem that’s now receiving more attention. This is the emergence over the past two decades of what the 2006 Nobel Laureate Edmund Phelps calls in his new book, Mass Flourishing, the “new corporatism.” This is a set of political and economic arrangements, Phelps maintains, that’s crippling economic growth while simultaneously creating a new set of “insiders” and “outsiders” in America — with most politicians being firmly in the “insider” category.

To be clear, Phelps doesn’t have in mind the fascist corporatism that characterized economies such as Mussolini’s Italy. Nor is he speaking of the “neo-corporatist” institutions established in many Western European countries after World War II in an (ultimately dysfunctional) effort to try and unify societies shattered by war and intense ideological divisions. The “new corporatism,” Phelps argues, is more “tacit and finely articulated.” In his view, it has two primary features.

As we stand on the verge of state-licensed newspapers, a dreadful prophecy is being fulfilled

As soon as the State has taken its bent to authority and philanthropy, and laid the least touch on private property, the days of the independent journal are numbered

By Allan Massie

When do you think this passage was written and – a more difficult question – by whom?

“We are all becoming Socialists without knowing it … A little while ago and we were all for Liberty … This is over; laissez-faire declines in favour; our legislation grows authoritative, grows philanthropical, bristles with new duties and new penalties, and casts a spawn of inspectors, who now begin, note-book in hand, to darken the face of England. It may be right or wrong, we are not trying that; but one thing it is beyond doubt: it is Socialism in action, and the strange thing is that we scarcely know it…”

Now I have cut a few phrases which might have given the game away – a mention of a certain “Mr Hyndman and his horn-blowing supporters”, for instance. Nevertheless it’s probable that the elegance of the prose, and the use of the word “authoritative” rather than “authoritarian”, will have suggested to you that it wasn’t written yesterday. In fact, as you may have guessed, the essay from which I have abstracted these sentences was published towards the end of the 19th century. It is entitled “The Day After To-morrow”, and that day, that tomorrow, are long behind us. Yet there are things in the essay which are confoundedly up to date.

Socialism, the author points out, will be imposed, or brought about, by Acts of Parliament. “Well,” he writes, “we all know what Parliament is, and we are all ashamed of it … Decay appears to have seized on the organ of popular government in every land; and this just at the moment when we begin to bring to it, as to an oracle of justice, the whole skein of our private affairs to be unravelled, and ask it, like a new Messiah, to take upon itself the part that should be played by our own virtues. For that, in few words, is the case. We cannot trust ourselves to behave with decency; we cannot trust our consciences; and the remedy proposed is to elect a round number of our neighbours, pretty much at random, and say to these: ‘Be ye our conscience; make laws so wise , and continue from year to year to administer them so wisely, that they shall save us from ourselves, and make us righteous and happy, world without end. Amen.' And who can look twice at the British Parliament and then seriously bring it to such a task?"

Economic complexity pays

As always, brains and skills beat natural endowments, and may even produce the better governance to make good use of them

By Martin Hutchinson 
John Authers, writing in the Financial Times on October 28, suggests societies succeed, not because of their resources but because of their knowledge and the economic complexity to which it leads. MIT's Atlas of Economic Complexity reinforces this thesis, producing visually very attractive graphics of such matters as a country's exports, showing where its economic strengths truly lie. 

Although like all "single cause" theories this is over-simplified, I think this is in essence right; it has a number of interesting implications for international investment and governance. 

There is not one factor that enables a country to become rich, there are three: resources, governance and knowledge/complexity. As is well known, resources alone are normally not enough; the world is full of examples of the "resource curse" in which resource-rich countries fail to develop properly and become state-dominated kleptocracies. 

The problem here is the state. If the resources are truly bountiful and the state fairly small, development may occur anyway. The Gulf States are a good example of this; by developing world-class educational institutions with the resource bounty and by avoiding massive welfare schemes in the early stages, those countries have developed a substantial educated middle class that is able to produce a genuinely wealthy country. Dubai is not a chimaera as a business center; it is able to compete with Singapore as an entrepot because the oil money from the region was used to develop non-oil businesses. 

UN Carbon Regime Would Devastate Humanity

Although it has become clear that the climate emperor has no clothes, the agenda behind it marches on

by  Alex Newman

If the United Nations and fellow climate alarmists get their way on restricting carbon dioxide, the poor will soon be getting poorer — much, much poorer — especially in places such as Africa, Latin America, and large swaths of Asia. It is hardly an exaggeration to suggest that millions could die of starvation, cold, and more. Despite bogus promises of abundant, government-mandated “green” energy (think Solyndra), Europeans, Americans, Japanese, and others who live in developed countries will suffer greatly, too. The devastation will be particularly severe among the least well-off.

Earth’s would-be rulers, however, do not seem to care. The radical UN plan to fight “climate change,” as outlined by the global body amid the implosion of its man-made global-warming theory, would dramatically curtail available energy supplies. If adopted, nobody disputes the fact that the scheme would grant unprecedented powers over people, businesses, and governments to planetary bureaucrats. The multi-trillion-dollar ploy would also wreak havoc on the global economy — virtually every human activity, including breathing, releases carbon dioxide.

On top of that, experts say the plan would have virtually no effect on the climate. Indeed, all of the UN climate models have already been thoroughly debunked as global warming, in defiance of hysterical predictions, stopped over a decade and a half ago (see companion article on page 25). But the agenda was never really to stop “global cooling,” “global warming,” or even “climate change,” so it is hardly surprising to learn that the UN is nowhere near ready to give up on its vision of complete planetary dominance.

The “Budget” to “Save” the World

With its latest report, the UN Intergovernmental Panel on Climate Change (IPCC) formally called for national rulers to help foist what it calls a “carbon budget” on humanity — rationing CO₂ emissions in a supposed effort to stop potential future temperature increases. The global body’s “solution” to the alleged anthropogenic (man-made) global-warming problem, however, can be summarized neatly without any mention of “climate” or “carbon”: More power and money for governments and international bureaucrats; less freedom and prosperity for humanity as a whole.

Following the course of ancient Rome

The U.S. is coasting on the fumes of past greatness, following the Roman road to ruins

By victor davis hanson

By A.D. 200, the Roman republic was a distant memory. Few citizens of the global Roman Empire even knew of their illustrious ancestors such as Scipio or Cicero. Millions no longer spoke Latin. Italian emperors were rare. There were no national elections.

Yet Rome endured as a global power for three more centuries. What held it together?

A stubborn common popular culture and the prosperity of Mediterranean-wide standardization kept things going. The Egyptian, the Numidian, the Iberian and the Greek assumed that everything from Roman clay lamps and glass to good roads and plentiful grain were available to millions throughout the Mediterranean.

As long as the sea was free of pirates, thieves cleared from the roads, and merchants allowed to profit, few cared whether the lawless Caracalla or the unhinged Elagabalus was emperor in distant Rome.

Something likewise both depressing and encouraging is happening to the United States. Few Americans seem to worry that our leaders have lied to or misled Congress and the American people without consequences.

Most young people cannot distinguish the First Amendment from the Fourth Amendment — and do not worry that they cannot. Washington, Jefferson and Lincoln are mere names of grammar schools but otherwise unidentifiable to most.

Separatism is thought to bring dividends. In California, universities conduct separate graduation ceremonies predicated on race — sometimes difficult given the increasingly mixed ancestry of Americans.

As in Rome, there is a vast disconnect between elites and the common people. Almost half of Americans receive some sort of public assistance, and half pay no federal income tax. About one-seventh of Americans are on food stamps.

Yet housing prices in elite enclaves — Manhattan, Cambridge, Santa Monica, Palo Alto — are soaring. The wealthy like to cocoon themselves in Roman-like villas, safe from the real-life ramifications of their own utopian ideology.

Keynes’s Ghost Continues To Haunt Economics

The Keynesian promise of prosperity springing from massive government spending is attractive to politicians, economists, and public intellectuals

by William L. Anderson

When the U.S. economy dipped into an inflationary recession in 1969, Murray N. Rothbard in his introduction to the Second Edition of America’s Great Depression wrote that the Keynesian paradigm could not explain that phenomenon, but Austrian economics could explain what was happening. If Rothbard was correct — and he was — then one might believe Keynesian “economics” should have been deep-sixed permanently, given it could not explain what everyone saw happening.

Likewise, during the turbulent 1970s and 1980, the bouts of inflationary recessions grew worse and even die-hard political liberals such as ABC News’ economics correspondence, Dan Cordtz, bemoaned the fact that the “rules of economics” no longer seemed to apply. Those so-called rules were not laws of economics at all, but rather were dogma first given by John Maynard Keynes in his infamous work, The General Theory of Employment, Interest, and Money.

Joyous economists such as Arthur Laffer, who espoused a form of what he and others called “Supply Side Economics,” declared that Keynesian “economics” was discredited, perhaps for good. The advent of three more inflationary recessions, including the current downturn, should have resulted in the permanent death of Keynesianism, but, alas, it seems that the Keynesian paradigm is more influential than ever.

Exhibit A is President Barack Obama who in 2009 shortly after taking office declared that America would “spend its way out” of the current recession.

Exhibit B has been Obama’s recent announcement that he would nominate Janet Yellen to head the Federal Reserve System. Yellen, not surprisingly, is a True Believing Keynesian.

Exhibit C is the ongoing popularity of Paul Krugman, who has done more than any other person in the world to promote Keynesianism and to demand it be applied, chapter and verse, to the world economy.

Exhibit D has been the continuing Keynesian policies of the Federal Reserve and the central bank of Japan.

Academic economists who hold to the “market test” view of economics should be puzzled. Here is a paradigm that claims there cannot be an inflationary recession, yet all of the recessions that have wracked the U.S. economy in recent decades have been inflationary. Furthermore, despite the spending of more than a trillion dollars in the name of the Keynesian “stimulus,” the economy continues to founder, as unemployment rates remain stubbornly high and millions of workers either have abandoned their search for work or work in part-time jobs just to keep food on the table.

Given the fact that both the George W. Bush and Barack Obama administrations (not to mention Congress) have followed the Keynesian playbook, the sorry results should be enough to discredit Keynesianism, this time for good. Either a theory explains and predicts phenomena or it does not, and it should be clear that Keynesian theory has failed.

Alas, the academic “market test” really does not embrace the actual success or failure of a theory. It seems that many academic economists do not wish to be bothered by what happens in the real world. The vaunted “market test” is not about actual results, but is about what many economists are willing to accept as what they wish to be true and what politicians believe is good for their own electoral purposes.

The assumption that comes with attempting to apply Eugene Fama’s “Perfect Market Hypothesis” to academic economics presupposes that economists are interested only in what actually occurs. Furthermore, the belief presumes that when presented with a set of facts, academic economists will give the same analysis and not be influenced by partisan politics.

Given the interpretations that economists such as Krugman, Alan Blinder, and others have made in the aftermath of the disastrous first week of “ObamaCare,” not to mention their shilling for the Obama administration itself, the latter is clearly untrue. Furthermore, we see there are “gains from trade,” as politicians tend to flock to those economists who can offer the proverbial “quick fix” to whatever ails the economy, as being seen as doing something confers more political benefits than doing the right thing, which is to curb the power, scope, and influence of state power.

Even Krugman admits that the appearance of expertise has fueled the Keynesian bandwagon:

In the 1930s you had a catastrophe, and if you were a public official or even just a layman looking for guidance and understanding, what did you get from institutionalists? Caricaturing, but only slightly, you got long, elliptical explanations that it all had deep historical roots and clearly there was no quick fix. Meanwhile, along came the Keynesians, who were model-oriented, and who basically said “Push this button” — increase G, and all will be well. And the experience of the wartime boom seemed to demonstrate that demand-side expansion did indeed work the way the Keynesians said it did.

In the past five years politicians have been pushing “button G” and all is not well. Yet, in this age of unrestrained government, the Keynesian promise of prosperity springing from massive government spending is attractive to politicians, economists, and public intellectuals. That it only makes things worse is irrelevant and beside the point. If the economy falters, politicians and academic economists blame capitalism, not Keynesianism, and they get away with it. 

Endgame for Pakistani Taliban

Afghanistan is a strange country

By M K Bhadrakumar

The killing of the chief of Pakistani Taliban Hakimullah Mehsud in a drone attack in North Waziristan on Friday becomes a definitive move on the Afghan chessboard. (Dawn). The United States is redeeming its pledge to Pakistan that it would help vanquish the irreconcilable elements within the (Pakistani) Taliban so that the peace process with the (Afghan) Taliban can go ahead. 

At the operational level, Friday’s drone strike suggests a high level of US-Pakistan intelligence coordination as well. I had written in my blog earlier this week that the turnaround in Pakistan’s official assessment of the collateral damage of drone attacks implied a political calibration that would mesh with the Afghan peace process. That is most certainly what is happening. 

Of course, the US is finally buying into the Pakistani allegation that it is a victim of cross-border terrorism masterminded from Afghan soil by foreign countries.  

What lies ahead? The high probability is that the reconciliation of the (Afghan) Taliban may gain traction. The US’ threat perception comes from the Al-Qaeda (with which elements of the Pakistani Taliban have links) while the thinking within the Obama administration in the recent years has been that the US can learn to live with the Taliban as they do not threaten US interests. 

Second, we may expect the US to be open to the idea of accommodating the Taliban in the Afghan power structure, especially in the southern and eastern regions of Afghanistan bordering Pakistan. Again, the western powers recognize that the Taliban are the only Afghan group with the capability to ’stabilize’ Afghanistan. 

Third, Pakistan can be expected to do all it can to persuade the Taliban leadership to reciprocate by acquiescing with the establishment of the American military bases in Afghanistan. Clearly, in the emergent calculus, a continued US military presence in Afghanistan would mean continued American dependence on Pakistan, which in turn would be beneficial for Pakistan in many ways. 

Having come so close to putting together the underpinnings if a viable post-2014 dispensation in Afghanistan, the US would now have to pay greater attention to the transition in Kabul in April. Clearly, the outcome of the presidential election in Afghanistan should be broadly acceptable to the Taliban as well. 

Suffice to say, it’s about time to take a closer look at the Rasul Sayyaf-Ismail Khan ticket in the April poll.This may sound strange, but then, Afghanistan is a strange country.  

I Confess: I’m a “Terrorist”

The ultimate terror in balancing the budget

by  Thomas R. Eddlem

Only in America are the ones who want to balance the budget and make raising the national debt limit unnecessary labeled “terrorists,” while those who want to raise the national credit card limit to infinity deemed reasonable. That’s the lesson of the October partial government shutdown and debt limit debate that the media have tried to teach us.

Count this “terrorist” among the learning-disabled on this lesson.

I say it’s all about the selling job. The media and most politicians trumpeted only one option as a metaphysical necessity throughout the debate: We must raise the debt ceiling. Nobody ever discussed the alternative, balancing the budget, which would have made raising the debt ceiling unnecessary.

Of course, as a “terrorist,” I could be wrong. The federal budget was balanced during the shutdown, as federal spending was cut by more than what the CBO projected annual deficit to be. And those spending cuts strangely didn’t move Obama’s debt limit deadline by even a single minute. Only a terrorist such as I would imply Obama cooked the books to hype that deadline.

But this is America. And in America we can rely on the fact that the terrorists always lose, just as reliably as Republican leaders always cave to the demands of Democrats. So, the debt limit will officially be infinity until February 7. We terrorists — the constitutionalist movement, Tea Party conservatives, and the Congressional Liberty Caucus — certainly lost. The only thing worse to a terrorist than not coming to a national debt limit deal is coming to a “clean” debt deal that simply enables more debt and a bigger reckoning later.

Can We Finally Retire Scientific Superstition?

Greenspan has learned too late but perhaps there is still time for the rest of us

by Donald Devine        

What an absolutely astounding admission former Fed boss Alan Greenspan makes about his new book The Map and The Territory: 

“Not a single major forecaster of note or institution caught it [the 2008 crash]. The Federal Reserve has got the most elaborate econometric model, which incorporates all the newfangled models of how the world works—and it missed it completely. I was actually flabbergasted. It upended my view of how the world worked.”

That this epitome of Washington brilliance and establishment power really thought the little models could actually forecast the future takes one’s breath away! One could expect that such models would be used as rough guides to action and to keep naive investors calm but that he was surprised the models did not predict specific events is incredible, especially for someone who supposedly had believed in markets. He admits he just now realizes that irrational fears influence how people behave! But we are supposed to trust these guys with $3 trillion sitting in the Fed, telling us they have a way out because the models are scientific, right?

Nobel Laureate F.A. Hayek predicted that people in the future looking back would “discover that the most widely held ideas which dominated the twentieth century” like scientific planning “were all based on superstitions…an overestimation of what science has achieved.” Hayek noted more than a half century ago that there were more intercortical connections in one person’s mind in a few moments than there are atoms in the entire solar system. While the material world still largely remains a mystery to science, human behavior is a real black hole. With billions of people’s minds and untold interactions between them the total human complexity is overwhelming. No super-mind in some Federal Reserve or White House can comprehend this complexity, much less control it. The progressive pretension to understand what they cannot possibly know is the true source of today’s discontent.

The number of books today rediscovering this truth is becoming a torrent. The Discovery Institute’s Stephen Meyer hit number seven on the New York Times bestseller list with his stunning new book, Darwin’s Doubt. The title reflects the fact that even Charles Darwin had one great doubt about his materialistic theory of human evolution, that natural selection by random mutation is the sole explanation of life on earth. Specifically, he questioned whether what was called the Cambrian Explosion of 500 million years ago could have occurred that recently (out of an estimate of only 3 billion total years of life on earth). How could higher life arise over such a short period of time, and where were the fossils demonstrating such a progression of forms?

The Good Guys Are Not Coming

No one is going to ride in and save you

by Paul Rosenberg
A lot of Americans know that the US government is out of control. Anyone who has cared enough to study the US Constitution even a little knows this. Still, very few of these people are taking any significant action, and largely because of one error: They are waiting for “the good guys” to show up and fix things.

Some think that certain groups of politicians will pull it together and fix things, or that one magnificent politician will ride in to fix things. Others think that certain members of the military will step in and slap the politicians back into line. And, I’m sure there are other variations.

There are several problems with this. I’ll start with the small issues:

1.     It doesn’t happen. A lot of good people have latched on to one grand possibility after another, waiting for a good guy to save the day, and it just doesn’t happen. Thousands of hours of reading, writing and waiting are burned with each new “great light” who comes along with a promise to run the system in the “right” way, and give us liberty and truth. (Or whatever.) Lots of decent folks grab on to one pleasant dream after another, only to end up right back where they started… but poorer in time, energy and finances.

2.   Hope is a scam. It’s a dream of someday, somehow, getting something for nothing. People who hope do not act – they wait for other people to act. Hope is a tool to neuter a natural opposition: they sit and hope, and never act against you. Even the biblical meaning of hope is something more like expectation (or sometimes waiting) than the modern use of hope.

3.   Petitioning an abuser for compassion. The “good guys” are considered to be a few people inside the abusive government. But if the good guys were really good, wouldn’t they have dissociated themselves with an abuser some time ago? By pleading for the good guys to rise up, people are asking one sub-group of the abusers to save them from the rest of the abusers. However, they all work for the same operation; they all get paid out of the same offices; according to the same rulebook. And if the good guys are so willing to turn against their employers, why would they have waited until now?

The Untouchables of the 21st Century

Why And How The Young Are Screwed

"Child of Texas migrant family who follow the cotton crop from Corpus Christi to the Panhandle."

By raul ilargi meijer

Last week I read a few lines in a Dutch newspaper article about pensions that immediately took me back to something I wrote in early May about youth unemployment - especially in southern Europe, where it's often 50% or more -. There is a common thread that links pensions to employment to stimulus measures: the younger generations invariably get the short end of the stick. Until they don't, of course, for they have one thing going for them. Age. Before they can play that ace, however, their parents seem intent on milking them for all they got. And I can’t help finding that curious, because it’s not at all what parents say they want for their children.

The Untouchables of the 21st Century

The numbers, let's focus on Europe for now, are certain to only get worse. How do we know? Easy as pie. It's a matter of political principle. All those unemployed young people are nobody's priority but their own. They simply don't have the political might yet to swing policy decisions in their favor. That is still with the generations of their parents and grandparents, who will vote against anyone trying to cut their wages and benefits.

Sure, the week after I wrote that, there was some mumbling from the likes of Angela Merkel and Spanish PM Rajoy to the extent that "something must be done", but nothing was, it was lip service only, and there are still exactly zero actual proposals to "do something".

People who are in power will do almost anything to hold on to it. That includes politicians, bankers, corporate executives. We can all identify those groups, and we love to rage against them. But political power in our societies is also defined by age. In that the young have very little of it, and the older have a death grip.

[..] ... until recently there was the prospect of going out and getting as much as, or more than, one's parents have (a better life for my children). That prospect is now gone. But people are slow to realize and accept that. They'd rather believe otherwise, and there are scores of politicians and media willing to keep that faith alive. After all, their own livelihoods depend on it.