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5.4 into 1 does not equal 5.4

I am doing a bit of cleaning up old filing boxes each day now as the date I will be moving offices approaches. It is actually an interesting process – looking through boxes and articles that have been stored away for some years now. Today, I came across an article that was in the US Magazine Challenge (March-April, 1982) entitled The Guilds of Academe and written by one Jack Barbash, who was an academic at the University of Wisconsin. It discussed the way in which the economics profession protects its belief system from criticism and avoids, as far as possible, addressing real world problems. The mainstream will talk as if they are addressing a real world problem – such as entrenched unemployment – but when you realise the models they are dabbling with you know that they are really talking about nothing real at all. This leads onto a forthcoming book by some British conservative MPs who have the temerity to argue that the British unemployment problem is due to the workers being to idle and diverted by pop music to bother working. You know instantly that the underlying model has come from a mainstream economist who hasn’t recently looked out the window or read any data.

The Challenge article was derived from a speech he made at the American Economic Association in December 1981. This Obituary in the New York Times gives you some impression of his background. He was an old-style institutionalist who considered trade unions to be important institutions in the capitalist system providing counterveiling power to the power exerted by employers.

If you have access to JSTOR then the paper is HERE.

In that paper, Jack Barbash is commenting on the way in which the economics profession had increasingly promoted “its craft … at the expense of its practical or problem-solving side”. He considered the mainstream profession to have become obsessed with the “paradigm”:

… thereby diminishing its ability to deal with specific problems.

The concept of a “paradigm” draws on Kuhn’s 1970 work and in Barbash’s words:

… establishes the analytical categories within which the professional discourse must be carried on if it is to gain guild recognition as a contribution to the discipline.

Elements of the dominant mainstream paradigm include the belief in “the maximizing individual in a free market” as the exemplar of welfare optimality and “the theory of economic equilibrium in a free market”, which would ensure the choices of those maximising individuals can have their voice and drive optimal resource allocations.

In effect, it has been very hard to operate as a professional economist in academic life if you chose to work outside of that “paradigm”. The elite (which operates like the mafia) generally controls the appointments processes; the editorship of major journals; the ranking systems that give weight to the journals they control; the leading panels on competitve national grant schemes; and the promotion processes within institutions.

Prior to even getting a doctorate, the elites control the curriculum; the grading systems; who gets postgraduate scholarships to pursue doctoral studies; and the examination panels to determine who gets doctorates.

There are gaps in this control. Some non-mainstreamers get through – but not many. And few get to the level of full professor, a position that bestows certain capacities (powers) independent of “paradigm” complicity. I have enough stories about the way the elite control things to fill several books. Maybe just one on that topic will materialise in the future when I have run out of other projects to pursue.

Jack Barbash captures the paradigm control function of my profession in this way:

Like the medieval craft guild, the academic discipline is built on a body of mysteries. But now, access to the mysteries is no longer protected by penalties and secret oaths but by a costly and arduous Ph.D. regimen of training and socialization in the ways of the discipline.

Notice he didn’t use the term “education” to describe the Ph.D. programs typically found in mainstream economics schools or departments. Training and socialisation rather than a broadening process of education to advance critical thinking.


The academic discipline, unlike the craft guild, also has no formal coercive apparatus at its disposal. It does have Kuhn’s “invisible college” … composed of a complex of professional associations, learned societies, annual meetings, journals, organized labor markets, graduate schools and their departments, foundations and government grantors – the equivalent of an “old-boy” network … [which] … hold out the prospect of advantage to those who conform to guild rules and guild disfavor to those who don’t.

He then proceeded to describe the way academic departments discipline thinking to ensure rebels are expelled and the compliant progress forward.

He considers the major work of mainstream economists to be “rigor over substance” and that behaviour is learned in graduate school. The student learns that “the most valued papers … become exercises in which method is more important than results. It does not detract from the result that it is nonsense in terms of the real world …”

Much earlier, the American (Marxist) economist Paul Sweezy wrote in 1972 in the Monthly Review Press article entitled Towards a Critique of Economics. that mainstream economics:

… remained within the same fundamental limits … of the C19th century free market economist … they had … therefore tended … to yield diminishing returns. It has concerned itself with smaller and decreasingly significant questions … To compensate for this trivialisation of content, it has paid increasing attention to elaborating and refining its techniques. The consequence is that today we often find a truly stupefying gap between the questions posed and the techniques employed to answer them.

Even the claim that the mainstream is the exemplar of rigour is misconstrued. In fact, there are many internal inconsistencies in the body of theory quite apart from whether the theory is devoted to counting the number of angels on a pinhead.

The 1960s and later Cambridge Controversies revealed that mainstream distribution theory is so deeply flawed that it is useless. That is, marginal productivity theory which purports that all product inputs are (fairly) rewarded according to their contribution to production (thereby eliminating any notion that profits are expropriated surplus value) was demolished by the critique.

More recently, the New Keynesian models which claim to be founded on micro-optimising principles (a five star badge type status) become so comprimised when they try to add, for example, unemployent to a highly abstract model where initially there is no money or labour market!

Please read my blog – Mainstream macroeconomic fads – just a waste of time – for more discussion on this point.

Jack Barbash acknowledges that there is some “ferment from within” the profession, which challenges the hegemony that the mainstream elites maintain. He provides a series of quotes – “culled from the president addresses before the American Economic Association” – which I publish in full.

1. Galbraith: “… In eliding power – in making economics a non-political subject – neoclassical economics destroys its connection with the real world.”

2. Leontief: “The weak and all too slowly growing empirical foundationclearly cannot support the proliferating superstructure of pure, or should I say, speculative economic theory.”

3. F.H. Hahn: “…. the spectacle of so many people refining the analysis of economic states which they give no reason to suppose will ever, or have ever come about …”

4. G.D.N. Worswick: “A marvellous array of pretend tools which would perform wonders if ever a set of facts should turn up in the right form.”

5. E.H. Phelps Brown: “… assumptions about human behavior that are plucked from the air.”

6. James H. Blackman: “The profession’s incentive system tends perversely to reward this kind of endeavor and to deflect the attention of gifted economists from the explortation of concrete problems and the dirty work that entails.”

7. R.A. Gordon: “The mainstream of economic theory sacrifices far too much relevance in it pursuit of rigor.”

He notes that this group of economists are hardly radical (“guild members of impeccable standing”).

The concluding part of the article is a reflection on suggested reforms. He says that students should be given a body of knowledge at the outset rather than being confronted with an abstract theoretical framework.

He says that:

Economic issues must be mastered on their own terms. It is the facts – If I may use that old fashioned word – which should lead to Theory, not the Theory which should select the facts … Theory tends to evolve into ideology when it becomes relevant only to itself. I believe this to be the current state of the art.

I was reminded of all that when I read the UK Guardian article (August 20, 2012) – Fixing Britain’s work ethic is not the answer to this economic mess – which once again shows that the mainstream economists and the policy makers they advise have no new tricks in their “paradigm bag” and are intent on restoring the sorts of policies that created the crisis in the first place.

Last week, Australia was “treated” to a visit from the UK Big Society advocate – the excessively pompous Phillip Blond – who told us that governments make things worse and individuals, pursuing their own self interest, should have command of the resources that the government takes via tax.

Please read my blog – The Big Society aka BS – for more discussion on why the BS is BS.

The UK Guardian article addresses a similar point. It ostensibly reviews a new book written by “five Tory MPs” who have “accused Britons as being among the worst idlers in the world”.

The familiar territory – the macroeconomy fails to generate enough work because aggregate spending is insufficient to entice firms to employ all those who want to work at the current wage levels and transfer payment arrangements.

Thousands, millions lose their jobs. Remember they were working then not working. No changes have occurred in the system of transfer payments (welfare benefits).

Mass unemployment persists as the deflationary multiplier further undermines aggregate spending – as a result of the lost income not spent from the unemployed workers reverberating through the economy.

Employment growth is weak if not negative and not sufficient to absorb the new entrants to the labour force and the unemployed. Social tensions emerge as people default on mortgages; lose their homes, lose their kids to care; commit suicide; take too many drugs or drink to much alcohol in despair; lose their social networks; all as a result of the worsening mass unemployment.

Some of the unemployed exit the active labour force to preserve their self-esteem – they get sick of applying for jobs that they never get even if they can find a job to apply for. The rising hidden unemployment attenuates the rise in official unemployment somewhat.

In this context, a neo-liberal government with an ideological obsession about small government and a disdain for the most disadvantaged citizens in their midst, imposes fiscal austerity – a policy that makes the entrenched unemployment even worse.

Then the spin starts. Intent on deflecting blame for their actions the government and its supporters then turn on the propaganda machine.

The nomenclature is developed to support the revisionism.

Australians might recall this appalling display by the current Federal Opposition leader Tony Abbott on ABC Four Corners program (a weekly national current affairs program that has been runnning for more than 50 years). As an aside, there is an excellent iPad app Four Corners 50 Years that is well worth installing and checking out.

On July 9, 2001, Tony Abbott, then the Federal Employment Minister appeared on the Four Corners program – Going Backwards – which was focused that week on the working poor who were on the rise in Australia and “not earning enough to get by”.

Data was produced by the show to show that “1 in 5 Australians living in poverty have wages or salaries as their main income” and that “the number of low-wage earners doubled between the mid-1980s and the mid-1990s” (although not all low-wage earners are below the poverty line).

The Federal Employment Minister told the program (among other things) that:

we can’t abolish poverty because poverty in part is a function of individual behaviour. We can’t stop people drinking. We can’t stop people gambling. We can’t stop people having substance problems. We can’t stop people from making mistakes that cause them to be less well-off than they might otherwise be. We cannot remove risk from society without also removing freedom and that’s the last thing that any government should do.

Tony Abbott also called the unemployed job snobs, which was mild compared to some of the other nomenclature used to describe the unemployed as neo-liberalism took its hold.

This 2010 MA Thesis from the University of Wollongong – Media, marketing and the dole cruisers – a welfare discourse case study – provides a good history of the way in which the conservatives vilified the unemployed.

The UK Guardian article notes that the Olympic euphoria “didn’t last long” – the adulation of the nation of gold medal winners has given way to:

… being depicted as a nation of slack-jawed lummoxes incapable of a decent day’s work, and to Iain Duncan Smith accusing the BBC’s economics editor Stephanie Flanders of “peeing all over British industry”, after she failed to greet falling unemployment figures with unquestioning wonderment.

The forthcoming Tory book claims that cohorts in Britain are “among the worst idlers of the world”. Australian conservatives call the unemployed – dole bludgers, job snobs, cruisers – the British, it seems call them idlers and preferring “a lie in to hard work”. Apparently, the British also use the term “welfare scroungers”.

The UK Office of National Statistics publishes a series VACSO1: Vacancies and unemployment – which allows us to compute the number of unemployed to each vacancy.

Here is the graph of the series from the first-quarter 2001. The series is currently at 5.4 – that is, there are at least five people seeking work than there are unfilled vacancies.

If you think about it, five point four into one doesn’t equal 5.4. Notice also the sudden jump as private spending collapsed as the world entered the global financial crisis. The Tory argument would require a very sudden behavioural change among millions of workers to be a fair account of what has happened.

I am sure psychologists would refute the claim that there was an outbreak of mass laziness in the UK around 2008. The Tories would also have to argue that the laziness spread very quickly throughout the world around then as well.

The Tory argument is the old worn out argument that is derived from undergraduate microeconomic courses on the impacts of welfare payments on job search effort.

Students learn about “corner-solutions” (no work all play) that are chosen by optimising agents given the current transfer payment level and the wage they might earn if they were to work. It becomes optimal to be unemployed. Students get inculcated with this “theory” every day and never really learn that five point four into one doesn’t equal 5.4.

They derive complex mathematical expressions for the corner solutions and take derivatives here and there (calculus derivatives that is) but lose sight of the obvious – the unemployed cannot find jobs that are not there.

Most neo-liberal economists, and certainly the major researchers who have influenced the OECD in designing their active labour market programs regime (which reflects the view that the unemployed are lazy), argue that the unemployment rate is higher now for a given level of vacancies because of structural shifts in the labour market. So they say the full employment unemployment rate is now higher than it was, say, in the 1960s because workers are less inclined to work (among other reasons associated with worker attitudes and preferences).

Representative of the supply-side emphasis and probably the most influential researchers in terms of the evolution of the 1994 OECD Jobs Study agenda, Layard, Nickell and Jackman (in their 1991 book: pages 4 and 38), explained the rise in the unemployment to vacancies ratio by:

… a fall in the search effectiveness … among the unemployed.

They also (page 268) claimed that the UV shift has been due to “rise in long-term unemployment, which reduces search effectiveness …” What does this mean? LNJ (1991: 38) offer the following explanation:

Either the workers have become more choosey in taking jobs, or firms become more choosey in filling vacancies (owing for example to discrimination against the long-term unemployed or to employment protection legislation.

They suggested that the first reason dominates. There is clearly an observational equivalence problem in attempting to test for this. Search time will lengthen when there are large cyclical downturns and the probability of gaining a job decreases.

However, it is a fallacy of composition to conclude that if all individuals reduced their reservation wage (the lowest wage they are prepared to accept) to the minimum (to maximise supply-side search effectiveness) that unemployment would significantly fall (given the small estimated real balance effects in most studies).

Further, unless growth in labour requirements is symmetrical and labour force growth steady on both sides of the business cycle, the pool of unemployed can rise and remain persistently high. But it is impossible to directly test changes in the motivation of individuals independent of the hypothesis that the shifts are collateral damage of severe recessions.

A vast number of studies have categorically demonstrated that increases in the unemployment to vacancy ratio occur during major cyclical downturns rather than any autonomous supply side shifts (arising from changes to welfare provisions).

Please read my blog – The unemployed cannot find jobs that are not there! – for more discussion on this point.

The Tory argument in this context has been discredited countless times.

But as the UK Guardian article argues that:

… what’s giving the politics of idleness a new lease of life is the marriage of an ancient Tory belief – that anyone can haul themselves up by their bootstraps, that failure means you’re not trying hard enough – with a newly fashionable argument about the decline of the decadent west and rise of the industrious east.

This is a new spin on the neo-liberal argument. That the communists in the east are doing better at capitalism than the inventors of it in Britain.

As the UK Guardian article notes the dole bludger is being melded with the living beyond our means narratives – the individual sloth and the national excess:

The young Tory turks are busy weaving a narrative not just of individual moral failing (too many workshy scroungers) but of national degeneration: a sense that we’ve been spoiled by years of easy money and need a collective kick up the backside. It’s intimately connected to austerity politics, with its inference that only rich countries can afford to go this soft.

Which translates into an all out attack on the twin evils – the disadvantaged and the “bloated public sector” – with some disdain for the youth who are “more interested in pop music and football” than in becoming lawyers.

The book also notes that average hours worked are shorter in Britain than elsewhere but the UK Guardian article is on to that one. The writer points out that the neo-liberal onslaught on full-time work and the rise of casualised, underemployed jobs leads – in a compositional sense – to a lower average.

Ultimately, the article gets it right:

Hauling ourselves out of recession might indeed be as easy as demanding everyone pull their socks up, if declining GDP really was just a fancy name for indolence.

Mass unemployment of the type being endured by Britain and most nations arises because of a systemic failure to create enough jobs and working hours.

The unemployed can do nothing about that. The overall aggregate demand constraint has to be lifted – spending rise – to entice firms to employ more workers.

The unemployed could trudge the streets until the cows come home. If there are not enough jobs then such job seeking will be in vain.

Please read my blog – What causes mass unemployment? – for more discussion on this point.

Regular readers will know of this little nursery story but it is worth repeating for new readers. I have updated it to reflect the current state.

Case study: the parable of 100 dogs and 92 bones

Imagine a small community comprising 100 dogs. Each morning they set off into the field to dig for bones. If there enough bones for all buried in the field then all the dogs would succeed in their search no matter how fast or dexterous they were.

Now imagine that one day the 100 dogs set off for the field as usual but this time they find there are only 92 bones buried.

Some dogs who were always very sharp dig up two bones as usual and others dig up the usual one bone. But, as a matter of accounting, at least 8 dogs will return home bone-less.

Now imagine that the government decides that this is unsustainable and decides that it is the skills and motivation of the bone-less dogs that is the problem. They are not skilled enough. They are idlers, bludgers and “bone-shy”.

So a range of dog psychologists and dog-trainers are called into to work on the attitudes and skills of the bone-less dogs. The dogs undergo assessment and are assigned case managers. They are told that unless they train they will miss out on their nightly bowl of food that the government provides to them while bone-less. They feel despondent.

Anyway, after running and digging skills are imparted to the bone-less dogs things start to change. Each day as the 100 dogs go in search of 92 bones, we start to observe different dogs coming back bone-less. The bone-less queue seems to become shuffled by the training programs.

However, on any particular day, there are still 100 dogs running into the field and only 92 bones are buried there!

You can find pictorial version of the parable here (for international readers this version was very geared to labour market policy under the previous federal regime in Australia and was written around 2001). I first screened this at a presentation that preceeded a talk by Tony Abbot, the then Federal Employment Minister now Opposition leader gave at the University as my guest.

In the UK there are about 92 bones for every 100 dogs and in Spain 75 bones for every 100 dogs!

The point is that fallacies of composition are rife in mainstream macroeconomics reasoning and have led to very poor policy decisions in the past.

There are simply not enough jobs


And on that note I will finish.

That is enough for today!

(c) Copyright 2012 Bill Mitchell. All Rights Reserved

This Post Has 29 Comments

  1. “If you think about it, five point four into one doesn’t equal 5.4.”

    And that’s just ‘ILO unemployed’ in the UK. When you include the LFM2 sequence ‘Inactive – wants a job’ then the ratio jumps to 10.5 to 1.

  2. “In the UK there are about 92 bones for every 100 dogs”

    There are about 92 bones for every 100 dogs actively looking for bones. There are at least another 8 dogs who’ve given up looking for bones, but would like one.

  3. The other point that is constantly misses is that productivity increases mean less manpower is required for any given quantity of output. And that is to be encouraged. We don’t want people working when machines can do the same thing.

    The rise in the number of ‘hand car washes’ in the UK is a retrograde step brought about by tax credit subsidies to essentially private businesses. Government subsidy there is competing away the automatic car washers – where the capital investment is not subsidised.

    Obviously it is more efficient for the auto washers to be in place – and improved in quality – while the people go off and do something machines can’t, as yet, do. Yet the system is going into reverse due to the perverse effect of the subsidy.

    That is the paradox of productivity. We want to encourage as much innovation and automation as possible, because that makes the quality of life better, but doing that means less people have a job and an income.

    Where people do comment on the paradox, it is often to suggest that machines shouldn’t be deployed.

    Amazingly, 200 years after it first came about, the Luddite question has yet to be answered adequately.

  4. This does make me sad. I originally studied economics because I thought it would help me understand poverty and so equip me to help its amelioration in whatever form. Initially I realised it was politics that was the problem, but now (and with posts like this) it just reinforces that it is the politics of economists that impede it.

  5. And here we get to the crux of the problem: right-wingers the world over simply believe that those eight dogs, whoever they are, have no right to a bone and consequently no right to life. It doesn’t matter which dogs they are, the fact that they are one of the eight means that they have failed and therefore must be allowed to wither away and perish. They’ll never state that opinion publicly but it’s the inevitable consequence of their entire ideology.

  6. Dave, poverty is always political. The amelioration of poverty is political as is it\’s creation, propigation and (one would hope) the solution to it. That economics is a political creature should surprise no one, I don’t think it should sadden you, the answer is to act politcally yourself. Democratic change by voting out the deluded politicians and weakening the political and economic idelologies they feed on and represent. Bills blog (and MMT in general) acts to undermine the basis of their arguments and the body of work produced undermines the evidence they trot out to support them athough to be fair they\’re doing a fairly good job all on their own…

  7. If a couple treated their children as the conservative authors of this tripe do; constantly berating them for their shortcomings, arbitrarily withdrawing pocket money and food, sending them out to work for nothing, wishing they had had hard working foreign children and reading catechism morning,noon and night as justification, they would be regarded by most human beings as cruel and ineffective parents.

  8. I thouroughly recomend the MA thesis linked to by Bill (the “Dole Cruisers” one). Eye opening, very readable and prescient with respect to the recent shenanigans with News Corp and the ongoing Lord Leveson enquiry into the media in the UK.

  9. Dear Neil Wilson
    While I agree with you that productivity-enhancing technology is the ultimate source of economic progress and should not be resisted, it can’t be denied that labor-saving capital increases frictional unemployment. Let’s assume that each year, 2.4% of the labor force lose their jobs because of some labor-saving technology and that on average it takes them 9 months to find a new job, then technological unemployment will be 1.8%. Not only will there be more frictional unemployment, but also dislocation costs. Every time somebody has to leave a certain activity, there are costs such as retraining, moving, selling the house. These costs are not subtracted from GDP

    Suppose that Peter loses his job because of computerization. He takes a 6-month training course and then finds another job in another city which is as good as the one he lost. He still had to incur the cost of the course, of selling the house and of moving, not to mention the psychological cost of changing his place of residence.

    Regards. James

  10. “it can’t be denied that labor-saving capital increases frictional unemployment.”

    I don’t deny it for a minute and it’s good you point it out. That’s all part of the ‘paradox of productivity’.

    “Every time somebody has to leave a certain activity, there are costs such as retraining, moving, selling the house. ”

    Which is another win for the JG – since that takes people as they are, where they are – allowing them to retrain ‘on the job’. Productivity induced frictional unemployment then becomes a transition job under the auspices of a Job Guarantee.

  11. Regarding the future of academic economics, James Galbraith wrote this in 2009:

    “As I have documented… there is a considerable, rich, promising body of economics, theory and evidence, entirely suited to the study of the real economy and its enormous problems. This work is significant in ways in which the entire corpus of mainstream economics-including recent fashions like the new “behavioral economics”- simply is not. But where is it inside the economics profession? Essentially, nowhere.

    It is therefore pointless to continue with conversations centered on the conventional economics. The urgent need is instead to expand the academic space and the public visibility of ongoing work that is of actual value when faced with the many deep problems of economic life in our time. It is to make possible careers in those areas, and for people with those perspectives, that have been proven wor- thy by events. This is-obviously-not a matter to be entrusted to the economics departments themselves. It is an imperative, instead, for university administrators, for funding agencies, for foundations, and for students and perhaps their parents. The point is not to argue endlessly with Tweedledum and Tweedledee. The point is to move past them toward the garden that must be out there, *that in fact is out there*, somewhere.”

  12. “It is the facts – If I may use that old fashioned word – which should lead to Theory, not the Theory which should select the facts ”

    Well, no facts are theory-neutral. In fact, theory selects which facts to explain, which to discard. The scientificity of a theory is not decibed by the selection of facts, but by the problem-solving capacity, explanatory-power, etc.

    I can come up with a theory X, which explains what I have selected already: say, facts A, B, and C. Unless this theory X explains facts other than A, B and C, it is pure ad hoc.

    Often times, two opposing theories accept the same set of facts. This happens because the accepted facts are not under the dispute. Even though every fact is a theory-laden, it does not mean that in every theoretical dispute, the dispute about all theories don’t arise. For instance, we don’t check the soundness of boolean logic when we discuss economics. However, if you are a philosopher of logic, you can look at the foundations of boolean logic and dispute there.

    The problem with the mainstream economics has nothing to do with the facts they have chosen to select and explain. It has to do with their adhoc nature, lack of problem-solving capacity, lack of prediction of facts which are not selected already, and too many empirical anomalies!!

  13. “There are simply not enough jobs”

    Are you sure there not enough retirees?

    If “the jobs” could talk, would they say it is not there are not enough jobs, but too many of you workers?

  14. Neil Wilson said: “That is the paradox of productivity. We want to encourage as much innovation and automation as possible, because that makes the quality of life better, but doing that means less people have a job and an income.”

    If positive productivity growth goes into reduced employment instead of increased output, then why not increase retirement?

  15. the disconnect between neo-liberal economics and facts is not hard to fathom
    it is in essence a faith
    if you believe in the “free market” involuntary unemployment is a problem
    you justify the system because it fulfills people’s demands
    faith and deception are natural bedfellows
    because of the need for justification
    perhaps the true believers fool themselves
    but ultimately the neo liberal deception seeks to justify inequality
    if facts cannot be ignored then the faith is maintained by blame
    in the platonic idealist tradition the sacred fights the profane
    the state and regulation are evil
    perhaps the most interesting question
    is how did neo liberalism seduce the mainstream?
    is there a fundamental unscientific kernel to economics
    certainly the need to justify the status quo naturally flows from equilibrium models
    but marx’s taunt -the point is to change
    challenges those who see the inequities of unemployment and poverty
    but are those who see voluntary unemployment disconnected from reality
    born of both faith and deception

  16. I will say I am not voluntarily in full time employment
    I would undoubtably choose part time work if it paid better or if the mortgage was paid and my children
    had access to free higher education

  17. “If positive productivity growth goes into reduced employment instead of increased output, then why not increase retirement?”

    Retirement is just a Basic Income Guarantee for people over a certain age, and it suffers from the same problems that the BiG does. Largely that it does not take into account that people need something to do and need to feel involved in society.

    We already have a growing problem with alienation amongst those who are ‘retired’ and many of them want to continue to work in some way – particularly when they don’t have a very big pension and so can’t access the ‘consumer retirement society’.

  18. I don’t understand why tories are so popular in UK. Constantly some 40% of people are supporting them. What are they thinking?

  19. More about facts:

    For instance, MMT sees no debt monetization. However, the dominant stance is that debts are monetized. MMT sees targetting rates in some cases = buying bonds/draining reserves.

    You see, one can describe a phenomenon in multiple and competing ways. Mainstream’s description “monetizing debts” has to do with their theory; same with MMT. That’s what I mean: facts are facts of a theory. Competing theories describe the same phenomenon in opposite ways. Sure, one day, a theory will won out; if that happens, that theory’s description will become a matter of fact. That’s what I mean by facts are theory-laden or that facts are facts of a theory. This is not my wisdom, anyway: it is one of the result of old positivist debates. Positivists thought there were theory-neutral facts (observational sentences). Today philosphers of science have moved beyond that.

  20. “I don’t understand why tories are so popular in UK. Constantly some 40% of people are supporting them. What are they thinking”

    No alternative. The other party is exactly the same economically. All you get is a choice of rosette colour.

  21. We’ve had to put up with Iain Duncan-Smith for a long time in GB and I can guarantee that his main problem is that Stephanie Flanders isn’t peeing on him. Fact.

  22. Labour (pink neoliberals and sleeping partners in the tripartite coalition) are actually polling more than the conservatives and the liberals. This, obviously, is an embarassment. Their masterstroke is to reintroduce the the blood stained anthony blair and his venal wife, cherry.
    The depression has been kind to the now wealthy warmonger, but not kind enough for cherry, as she plans on joining in the asset stripping of the NHS.

  23. For instance, MMT sees no debt monetization. However, the dominant stance is that debts are monetized. MMT sees targetting rates in some cases = buying bonds/draining reserves.
    If there is disagreement in what is occurring then the description cannot be factual. If there is disagreement regarding the outcome, then the outcome is not factual.

    You see, one can describe a phenomenon in multiple and competing ways.
    You may also be describing a process, or a theory. Neither of these categories are facts.

    “Pluto is a planet” is a truth statement. Whether or not this statement is factual depends on the definition of “planet”.

  24. Neil Wilson said: “Largely that it does not take into account that people need something to do and need to feel involved in society.

    We already have a growing problem with alienation amongst those who are ‘retired’ and many of them want to continue to work in some way – particularly when they don’t have a very big pension and so can’t access the ‘consumer retirement society’.”

    There is a difference between not having a big enough “pension” and involved in society. Having a big enough “pension” means being able to choose volunteering or other means of being involved.

  25. “Having a big enough “pension” means being able to choose volunteering or other means of being involved.”

    Rather more people that you might imagine need to be actively encouraged to get involved. The amount of ‘self starters’ in society is vastly over-estimated – normally because people who do things are self-starters and people have a tendency to believe the rest of the world is mostly like them.

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