Monday, 6 July 2015

Best marks, goals, kicks and blunders, Rd 14

You don’t have to know anything about AFL to enjoy this week’s best marks, goals, moves and blunders!

There’s no other game like this.

Quote of the Day: When democracy will fail …

"Democracy will fail when people begin
to think they can vote themselves rich."

- PJ O'Rourke

Acropolis Now?

Screen Shot 2015-07-05 at 20.05.34The new Drachma? How long?

“Greece has voted No, and resoundingly so…”

“Greece has voted No, and resoundingly so. But the reaction from Berlin tonight does not suggest that Germany is prepared to have any further negotiations with the Syriza government.”
German rhetoric suggests that they are preparing to try and kick Greece out of the Euro – James Forsyth, SPECTATOR

“Yesterday the embattled Greeks delivered still more body blows to the rotten regime of Keynesian central banking and the crony capitalist bailout state to which it is conjoined…
    “[A “no” vote] would clarify that everything at issue between the parties is false. There is no way to pay Greece’s debts, modify the troika austerity plan, save the euro, rescue Greece’ banking system or stabilize Europe’s hideously mispriced and distorted debt markets.
    “It’s all going to blow and it should. The entire European mess has been concocted by statist politicians and policy apparatchiks who falsely and arrogantly believe they can defy the laws of markets, sound money and fiscal rectitude indefinitely.
    “The truth lost in all the meaningless “puts and takes” of the latest negotiations is that the Greek state was bankrupt five years ago …”
Good On You, Greece—–But Don’t Waver Now (Part 2) – David Stockma, CONTRA CORNER

Our base case is that the pressures coming from a dysfunctional banking system in Greece will shorten the time horizon to negotiate a deal to a handful of weeks. As that pressure builds, there is likely to be a temptation to call a referendum in Greece on euro membership, and for the state to begin issuing I-O-Us or similar and giving these some status as legal tender. To the extent that pensioners and public sector employees find themselves being paid with such instruments, it takes the banks further away from solvency …”
The "Nightmare Of The Euro-Architects" Is Coming True: JPM Now Sees Grexit, Eurogroup "Split In Coming Days" – ZERO HEDGE

“Alexis Tsipras will stay as Prime Minister, and see the result as a mandate to negotiate a better deal. But that’s not how the Germans see it: their economic affairs minister, Sigmar Gabriel, has just told the Tagesspiegel newspaper that  has just “torn down the last bridges on which Greece and Europe could have moved towards a compromise” and furthermore … “With the rejection of the rules of the eurozone … negotiations about a programme worth billions are barely conceivable.”
    “Events could well spiral out of anyone’s control. Here’s what we’re now facing…”
The Greeks have voted ‘no’. Now, the real crisis will begin – Fraser Nelson, SPECTATOR

“ … The problem is thus a lack of political will throughout the country. Too many people are benefiting from the way things have always been done in Greece to risk changing it, even for a promise of greater long-term growth. Seen that way, it's no wonder the guy they elected to represent them has so stubbornly refused to go along with the demands of Greece's creditors.
    “"Lots of things need to be done, but no government—this one or the previous ones—have been willing to do them," Azariadis says. "Some of [Tspiras'] predecessors claimed to believe in reform, but when push came to shove...they promised them but they never delivered. Reform is something that no political party in Greece really wants or is willing to go through with."”
Greeks Say No to Austerity—Again—But There Was No Good Outcome in This Referendum – Stephanie Slade, HIT & RUN

“Here is how the German megabank sees the possible outcomes of what is shaping up to be a "No" vote: … “
A "No" Victory Appears Probable: What Happens Next According To Deutsche Bank – ZERO HEDGE

“That, once again, is the Varoufakis all-in gamble, a gamble which assumes the ECB will be rational enough (in a game theory context) to appreciate the fallout of a Grexit on Europe’s creditors. Here is a qualitative determination …”
Why The Eurocrats Are Petrified——What The Falling Dominoes of ‘Grexit’ Look Like – CONTRA CORNER

image“For the point I want to make, it doesn't matter if they vote YES or NO, though that may have significant repercussions for the global economy.  The critical matter from the point of view of economic theory and policy discussions is to sort out the root cause of the fiscal mess -- not only in Greece, but among several EU states. And, of course, by this logic the US situation is not immune from judgement, nor anywhere else throughout the globe.  Democratic fiscal policy appears to have an institutional problem with regard to sustainable public finance.  How do we design our institutions of public administration and finance in a democratic society so they encourage fiscal responsibility?  Lack of such fiscal responsibility entraps economies in, what Adam Smith termed, the juggling tricks of deficits, debt, debasement.  This trick sucks the vibrancy out of an economy, and if left undisciplined sinks an economy altogether in a way we have been witnessing in Greece. …”
Greece and Wrestling with the Fiscal Commons – Peter Boettke, COORDINATION PROBLEM

“They want the Eurogroup to bailout Greece without restrictions. Yup, just take money from other Euro citizens (or print it up) and give it to the Greeks. So they want the Greeks to vote "no" on  the referendum question of whether Greece should accept a recent EuroGroup tax/bailout program .
    “They do not hold the much sounder view that the referendum should be voted down, so that the Greek's can get from under the oppressive demands of the EuroGroup protectors of the banksters and launch a fully free market economy without further oppressive "bailouts." In the end, the lefties just want to make things worse for the Greeks, despite their being on the correct side of the referendum vote itself.”
Lefty Economists are Pretty Good on the Greek Referendum – Robert Wenzel, ECONOMIC POLICY JOURNAL

“Deposit confiscation will be required long before hyperinflation is an option, do note that is not exactly a reassuring thought.  In fact hyperinflation is too slow and inefficient a way to steal from the citizenry in this setting.”
Might Greece see some version of hyperinflation? – Tyler Cowen, MARGINAL REVOLUTION

“Will the euro-fanatics please stop lying to the people of Greece? And while they’re at it, will they please stop lying to the rest of us as well?”
The Eurocrats’ Big Lie——Life Outside The Euro Has Worked Just Swell For Romania, Bulgaria, Poland, Turkey, The Czech Republic Etc. – Brett Arends, MARKETWATCH

“These “emergency” measures were supposed to have healed the problems that caused the financial crisis of 2008 — the excessive leverage, the toxic assets wrapped in complex derivatives, the resultant credit and liquidity crunch that occurred when banks lost faith in each other. Meanwhile, the infusion of cheap money and liquidity into banks gave a select few of them more power over a greater pool of capital than ever. Stock and bond markets skyrocketed as a result of this unprecedented central bank support.
image    “QE-infinity isn’t a solution — it’s a deflection. It’s a form of financial subterfuge that causes extra problems. These range from asset bubbles to the inability of pension and life insurance funds to source longer term less risky long-term assets like government bonds, that pay enough interest for them to meet liabilities. They are thus at risk of rapid future deterioration …”
In A World Of Artificial Liquidity—–Cash Is King – Nomi Prins, CONTRA CORNER

“Financial experts in New York, London, and Brussels have tut-tutted Greece’s economic travails as Athens considers its future with the European Union. Why did they borrow so much money? How can they ever pay it back? Do they think that much debt is sustainable?
    “Instead of pointing fingers at the innumerates running Athens, they should consider our own situation.”
Athens on the Potomac – Jon Gabriel, RICOCHET

“Tyler Cowen is on it, with a simple message: Greece is small; China is large. Uh oh.”
Don’t Look Now But . . . China? – POWERLINE
China facts of the day – Tyler Cowen, MARGINAL REVOLUTION
China Scrambles to Put Plunge Protection Team Together: Brokers Pledge Support For Crashing Market – ZERO HEDGE


Since 1830 the country has defaulted on its debts five times. Indeed, the only two countries that have defaulted more often are Ecuador and Honduras. To quote Brown: “To a person with any historical awareness, being told that Greece is on the verge of a default is like hearing Dean Martin is on the verge of a martini”.”
Same Greek default, different day – Jason Krupp, NZ INITIATIVE


“Actually it is the middle-class rorts that have really made the system unsustainable, like the “blind” pensioners in Greece and the affluent Australians who have their child-minding subsidised. Plus red and green tape which are the legacy of middle-class activism. Not to mention Keynesianism.”
The rise of the unsustainable welfare state – Rafe Champion CATALLAXY FILES

“Today, on day one after the Greek default, I am angry. So with apologies, here is my Athens rant.
    “The past week must have been the most extraordinary yet in the never-ending euro crisis. I just cannot recall anything like it ever happening before. What we have witnessed is an incredible combination of political dilettantism, chutzpah and aggression.
    No-one in this euro game is innocent. Everyone involved has to take their share of the blame and acknowledge their roles in the escalating crisis.
    “To start with the original sin of the euro crisis, Greece should have never, ever been made a part of the eurozone. And the eurozone should have never happened in the first place. …
    “There is only one hope. Now that Greece is finally and officially bankrupt, perhaps we might eventually see something resembling a solution to the crisis. How about Greece exiting the eurozone, devaluing its new currency, default on its debt and reform its economy? I have been arguing this case for five years in this column, and I am not the only economist who has been saying so.
    “Will European leaders finally listen to us?”
The eurozone must stop playing the blame game – Oliver Hartwich, BUSINESS SPECTATOR

“Dear Prime Minister Tsipras and Finance Minister Varoufakis:
    “You may have won a four-month reprieve of sorts from your creditors, but your situation is desperate, and everyone knows it, most particularly Europe’s paymasters, the Germans. As you just painfully learned, your ability to blackmail your creditors is a fraction of what it once was.
    “If you’re serious about saving your country and rescuing its people from a more dreadful economic catastrophe, there are basic steps you should take that would promptly promote economic growth, while giving you the priceless political opportunity to tell the troika–the IMF , the ECB and the EU (i.e., the Germans)–where to get off.
    “Here’s how you can put away your beggar’s cup for good. …”
Steve Forbes Pens Open Letter to Greek Leaders; Greece Can Teach The World A Needed Lesson – THE PAPPAS POST

“There is now a clear rift between Germany and France, perhaps serious enough to cause long-term damge to the coherence of monetary union. …
    “Italy’s Matteo Renzi said the sight of pensioners weeping in front of banks was a black mark on the conscience of Europe. “We must start to speak to each other again, and nobody knows this than better than Angela Merkel,” he said. …
    “Yet matters will be decided by handful of people in Berlin, Frankfurt, and Brussels over coming days, with the ECB in the unwelcome position of having to decide by its actions whether or not to bring the crisis to a head.
    “Syriza sources say the Greek ministry of finance is examining options to take direct control of the banking system if need be rather than accept a draconian seizure of depositor savings – reportedly a ‘bail-in’ above a threshhold of €8,000 – and to prevent any banks being shut down on the orders of the ECB.
    “Government officials recognize that this would lead to an unprecedented rift with the EU authorities. But Syriza’s attitude at this stage is that their only defence against a hegemonic power is to fight guerrilla warfare.”
Defiant Greeks Contemplate Drastic Actions——Nationalisation Of Banks And Printing Euro Notes W/O ECB Approval – Ambrose Evans-Pritchard, THE TELEGRAPH

“By now it should be clear to all that the only reason why Germany has been so steadfast in its negotiating stance with Greece is because it knows very well that if it concedes to a public debt reduction (as opposed to haircut on debt held mostly by private entities such as hedge funds which already happened in 2012), then the rest of the PIIGS will come pouring in: first Italy, then Spain, then Portugal, then Ireland.”
When The PIIGS Coming Marching In——Why Germany Is Petrified Of Greek Debt Relief – ZERO HEDGE

“Our students are thinking: “At least it’s not Argentina again.” We’re thinking: “This is great, a real-world experiment we can talk about for years.”
    “Some things to think about as the Greeks vote “no” …”
All Greece, all the time – NYU Stern Economics

“On Wall Street in 1929, it was the great banking houses of J.P. Morgan and Guaranty Trust Company. In China today, it’s names like Citic Securities Co. and Guotai Junan Securities Co.
    “They’re separated by 86 years and 7,300 miles, but Chinese financiers are turning to the same playbook used by their American counterparts to fight a crash that’s wiping out stock-market fortunes on an unprecedented scale.
    “Investors in China are hoping it works out a lot better this time around. …”
China Brokers Dust Off Wall Street’s Playbook From Crash of 1929 –BLOOMBERG

China Stocks Versus Dow Average in 1929

Sunday, 5 July 2015

Quote of the Day: "The New Testament v the American Revolution" [updated]

"It is impossible to square the kind of violent rebellion that America’s revolutionary creators advocated and engaged in with the actual meaning of the scripture and accurate interpretations thereof.

"The New Testament demands complete submission and obedience to the state; submission to the emperor; payment of taxes; and submission to evil—including violent aggression. Considerations of things such as "due process" and "no taxation without representation" are simply alien to the New Testament.

"The Declaration of Independence is a moral argument for rebellion against an unjust state. The New Testament is a moral argument against rebellion in the face of tyranny. The respective purposes of the two texts are wholly at odds. ...

"The New Testament offers no advice on how to produce earthly wealth and achieve earthly happiness. On the contrary, it instructs followers not to worry about what they eat or wear, but rather to act like "the flowers of the field" that neither toil nor spin.31 And it contains no doctrine of individual rights. Rather, it commands followers to "turn the other cheek" when struck and to obey the state as God’s agent on earth.

"The main documents of the American founding—the Declaration of Independence and the U.S. Constitution—were written to enable individuals to pursue the goal of earthly prosperity. They are the products not of faithful obedience to divine commandments, but of rational thinking about the requirements of life and happiness on earth. The American Revolution was not in any sense driven by or supported by the New Testament; it was, in effect, nothing less than a spectacular repudiation of that scripture.

"Conservatives like to ask, "What would Jesus do?" With regard to the American Revolution, the answer is clear. If Jesus had been alive in the 18th century, he would have unequivocally opposed it—as, in principle, he emphatically did in the Gospels."

- James Valliant, from 'The New Testament versus the American Revolution' in The Objective Standard

UPDATE: The quote's author -- the author of the article to which the quote is linked -- is taking questions at the Facebook Group, 'For the New Intellectuals.’


James Madison:

“Religious bondage shackles and debilitates the mind and unfits it for every noble enterprise....During almost fifteen centuries has the legal establishment of Christianity been on trial. What have been its fruits? More or less, in all places, pride and indolence in the clergy; ignorance and servility in laity; in both, superstition, bigotry, and persecution.”

“Religion and government will both exist in greater purity, the less they are mixed together.”

Thomas Jefferson:

“They [the clergy] believe that any portion of power confided to me, will be exerted in opposition of their schemes. And they believe rightly: for I have sworn upon the alter of god eternal hostility against every form of tyranny over the mind of man.”

“In every country and in every age the priest has been hostile to liberty; he is always in alliance with the despot, abetting his abuses in return for protection to his own.”

Our civil rights have no dependence on our religious opinions, more than on our opinions in physics and geometry…”

Thomas Paine:

“The Bible was established altogether by the sword, and that in the worst use of it — not to terrify but to extirpate.”

John Adams:

“I almost shudder at the thought of alluding to the most fatal example of the abuses of grief which the history of mankind has preserved — the Cross. Consider what calamities that engine of grief has produced!”

“Where do we find a precept in the Bible for Creeds, Confessions, Doctrines and Oaths, and whole carloads of trumpery that we find religion encumbered with in these days?”……..“The Doctrine of the divinity of Jesus is made a convenient cover for absurdity.”………“...Thirteen governments [of the original states] thus founded on the natural authority of the people alone, without a pretence of miracle or mystery, and which are destined to spread over the northern part of that whole quarter of the globe, are a great point gained in favor of the rights of mankind.”

“The government of the United States is not in any sense founded on the Christian religion.”

  • “As the quotes on this page illustrate, the claim that America was founded on Christianity is a myth.”
    A Christian Nation – Deism – RELIGION.AYN RAND
  • “What's the basis of western civilization? A commenter here at Not PC suggested that religion, specifically christian religion is the foundation for western civilisation.
        “Now that's a widespread view to be sure, and one that is totally wrong. …”
    A christian nation? – NOT PC
  • “Culture warriors, pseudo historians and opportunistic politicians have spent the last several decades peddling the myth that America was founded as a ‘Christian nation.’  The propaganda appears to be working… [In fact,] the drafters of the Constitution took the radical step of founding the first nation in history with no established religion.  Truth be told, they had little choice.”
    Dispelling the myth of a ‘Christian nation’ – Charles Haynes, WASHINGTON POST
  • “It was not Hebrew desert dwellers who most fundamentally gave birth to Western civilisation, but the ancient Greeks.”
    “So, How Come You Keep Bashing Religion?” – NOT PC
  • But isn’t America a Xtian nation? Um, no. It’s not.
    Is the United States a Christian nation? – Diana Hsieh, PHILOSOPHY IN ACTION RADIO [AUDIO]
  • The tragedy of theology: How religion caused and extended the Dark Ages – Andrew Bernstein, OBJECTIVE STANDARD

Friday, 3 July 2015

Quote of the Day: On trusting your newspapers ...


Briefly stated, the Gell-Mann Amnesia effect is as follows. You open the newspaper to an article on some subject you know well. In Murray's case, physics. In mine, show business. You read the article and see the journalist has absolutely no understanding of either the facts or the issues. Often, the article is so wrong it actually presents the story backward—reversing cause and effect. I call these the "wet streets cause rain" stories. Paper's full of them.

In any case, you read with exasperation or amusement the multiple errors in a story, and then turn the page to national or international affairs, and read as if the rest of the newspaper was somehow more accurate about Palestine than the baloney you just read. You turn the page, and forget what you know.

― Michael Crichton

Happy Second of July

The promise of liberty that America once represented is tarnished, but still worth celebrating says David Boaz in this guest post. Maybe even today …

America’s Fourth of July holiday is America’s Independence Day, celebrating our Declaration of Independence, in which we declared ourselves, in Lincoln’s words, “a new nation, conceived in Liberty, and dedicated to the proposition that all men are created equal.”

The holiday weekend would start today if John Adams had his way. It was on July 2, 1776, that the Continental Congress voted to declare independence from Great Britain. On July 4 Congress approved the final text of the Declaration. As Adams predicted in a letter to his wife Abigail:

The second day of July, 1776, will be the most memorable epoch in the history of America. I am apt to believe that it will be celebrated by succeeding generations as the great anniversary festival. It ought to be commemorated as the day of deliverance, by solemn acts of devotion to God Almighty. It ought to be solemnized with pomp and parade, with shows, games, sports, guns, bells, bonfires, and illuminations, from one end of this continent to the other, from this time forward forever more.

The Declaration of Independence, written by Thomas Jefferson, is the most eloquent libertarian essay in history, especially its philosophical core:

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. — That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, — That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.

Jefferson moved smoothly from our natural rights to the right of revolution:

Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn, that mankind are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed. But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security.

The ideas of the Declaration, given legal form in the Constitution, took the United States of America from a small frontier outpost on the edge of the developed world to the richest country in the world in scarcely a century. The country failed in many ways to live up to the vision of the Declaration, notably in the institution of chattel slavery. But over the next two centuries that vision inspired Americans to extend the promises of the Declaration — life, liberty, and the pursuit of happiness — to more and more people. That process continues to the present day, as with the Supreme Court’s ruling for equal marriage freedom just last week.

At the very least this weekend, if you’ve never seen the wonderful film 1776, watch it on DVD or Netflix.

David Boaz is executive vice president of the Cato Institute, where this post first appeared.


Thursday, 2 July 2015

Mark Textor’s “centre-right beliefs”: paternalistic populist pabulum [updated]

David Farrar has just posted a statement of philosophical by spin merchant Mark Textor that’s supposed to be a call to arms for something called “the centre-right.” As a Key Government adviser it’s worth taking note. As a philosophical position statement it seems to amount to can’t we all just get along:

Even outside of partisan party politics, enhanced by media megaphones, a shouting match is going on between a very few. Like many fights, most decent people are silently walking away to avoid it.
Most want the false and divisive constructs of politics to go away: Christian versus non-Christian, middle class versus others, country versus city, indigenous versus non-indigenous, bosses versus workers.
Promoting these suit the shock jocks on the right and outrage merchants on the left looking for micro audience-based sales. I find that this is leading many decent-minded conservative centrists to question their beliefs.
A modern alternative affirmation of conservatism is needed for those who have walked away from the shouting. Here’s a new one for them ….

We’ll get to his “new one” in a moment. The basic point he makes first though has been said before but far more fundamentally, not just as a “stance” but as a fully-fledged philosophical position. It’s been said before by Frederic Bastiat, who identified around the time New Zealand was being born that, rather than antagonisms, as long as plunder is outlawed human beings have fundamental harmonies that encourage peaceful co-existence. But those who favour plunder

have found fundamental antagonisms everywhere:

    Between the property owner and the worker.
    Between capital and labour.
    Between the common people and the bourgeoisie.
    Between agriculture and industry.
    Between the farmer and the city-dweller.
    Between the native-born and the foreigner.
    Between the producer and the consumer.
    Between civilization and the social order.

And, to sum it all up in a single phrase:

    Between personal liberty and a harmonious social order.

And this explains how it happens that, although they have a kind of sentimental love for humanity in their hearts, hate flows from their lips. …

Like Textor, Bastiat understands these alleged antagonisms are inflamed by plundering pygmies seeking rents. But Bastiat then sets out over the course of his book-length Economic Harmonies to explain, well, the natural economic harmonies between each of these so-called antagonists. Which is more than just spin.

Nevertheless, it got me wondering what Textor himself, a master spin merchant, wanted to inflame hereby. What is his “modern alternative affirmation of conservatism” I wondered?

Textor’s statements [along those lines] are:

  1. We respect the continuity, strength and certainty that the rule of law and our constitution brings.
  2. Conservatism is about resisting gratuitous change, but not resistance for its own sake.
  3. Our economy must be managed according to the principles of a fair, competitive and open market, but the end point is not the economy itself but a better life.
  4. If you are a citizen of this country, you have equal rights and, yes, equal responsibilities to other citizens and the country.
  5. We will not tolerate the intolerant.
  6. Those who obtain the privilege of leadership; be parental in nature: respectful and aware of true needs of those under your care, but be clear and consistent in your actions.
  7. Work and enterprise brings dignity and the opportunity and vibrancy [sic].
  8. Conservatives conserve important things.

Nice-sounding pabulum. “Not a bad list,” says David Farrar. But is it? Is it really?

  • Start with number 5 since it’s most topical: “We will not tolerate the intolerant.” But the test of free speech is not when someone says something you that doesn’t offend you, but precisely when they do. This, says Textor, we should not tolerate. And the Government he advises has just passed the Harmful Digital Communications Bill to ensure they won’t.

That’s not just harmless pabulum.

  • What about 8: “Conservatives conserve important things.” What’s important? Judging by the actions of the Government he advises, and from the Harmful Digital Communications Bill they passes, obviously not free speech. From its treatment of Christchurch, obviously neither property rights nor democracy.
  • 4. “…you have equal rights and, yes, equal responsibilities to other citizens and the country.”  The only responsibilities any citizen has is those they have voluntarily assumed, and these are certainly not assumed equally. To enforce un-named responsibilities is to obliterate the rights. Textor invokes rights only to diminish them.
  • 7. “Work and enterprise brings dignity and opportunity and vibrancy.” The primary point of work is production for consumption. It is no more the role of government to direct either, any more than to enforce an ethic of work for work’s sake.
  • 3. “Our economy must be managed …” As folk from Cantillon to Smith to Mises to Hayek have pointed out, and citizens from Greece to Puerto Rico to Venezuela are learning anew every day, when the government “manages” an economy what you achieve is very definitively not a “fair, competitive and open market.”
  • 2. “Conservatism is about resisting gratuitous change … “ Even if that means resisting rolling back programmes of the previous government that you once identified as “communism by stealth.”  So more accurately then, conservatism is about swallowing dead rats.

But as Rand used to say, never bother to examine a folly; ask yourself only what it achieves. What this achieves, hopes Textor is stated very clearly in his point 6:

“Those who obtain the privilege of leadership; be parental in nature … “

That, right there, is the very essence of his “modern conservatism.” In a word: Paternalism. Nanny knows best. Government for simpering idiots who need to be told how, when and with whom they can behave.

Isabel Paterson once observed,

"If you hear some bad collectivistic notions, chances are that they came from [modern] liberals. But if you hear or read something outrageously, god-awfully collectivistic, you may be sure that the author is a conservative.”

Textor’s whole cracker-barrel political philosophy amounts to enforced parental oversight for grown adults.You would have to be a simpering idiot to buy it.

UPDATE: Assuredly no coincidence NBR hosts a big (paywalled) interview with Key in which

Key says National is toast if it just bumbles on:

If we don’t continue reinventing ourselves with new policies and new ways of doing things, a refreshed mandate, if you like … [voters] get to 2017 and they will say ‘well you’ve run your race, you were there to do a certain thing for us and you’ve done it.’

Given that the bulk of the Key Government’s three terms to date have been holding the line against “gratuitous change” (see point 2 above), which as amounted to forcing the rest of us to swallow Clark and Cullen’s dead rats, I wonder what “it” actually was?

Answers on a postcard, please.

Is this what we need for blog comments?

Well, clearly not this blog since the comments rarely get above the tepid. But some swamps sure could use them.

Embedded image permalink

[Hat tip]

“Melbourne is a man-made city.”

It’s probably no secret to both my readers that Melbourne is my favourite Australian city. And it’s not just the footy,although it helps. Here’s one reason: there’s an old English proverb, first used  used by Alexander Pope, I think:

“God made the country; and man made the town.”

You don’t have to be religious to get the point.1 What the gods gave Sydney was a beautiful harbour; with some obviously blinding exceptions, it’s the man-made parts that let it down. Apart from the harbour and points around it, too much of the wider townscape is like a large Henderson,with an even larger car park.

Melbourne feels different. Melbourne inherited virtually nothing from the gods – a flat cityscape, a dull sort of port, a river floating upside down. But what man brought to it, that’s what makes it a great city.

Melbourne is a man-made city. It’s a great man-made city.

This student film does a great job of describing why …

the cerebral city from John Moody on Vimeo. [hat tip Max Harris]

1. In the wider context, Ayn Rand called it the distinction between the metaphysical and the man-made, but that takes us way off-piste.

Wednesday, 1 July 2015

Architectural Mini-Tutorial: Radiant Heat


Snowy bachman house“Let it snow!”
The Frank Lloyd Wright-designed
Bachman-Wilson House.

Lots of homes new and old now have a system installed in their floors called “radiant heating,” sometimes just called “underfloor heating,” a system of heating coils in your concrete floor that keeps it warm in winter even when it’s a winter wonderland outside.

Why is it so damn good when used properly, why is it so widely misunderstood? (And who really invented it?)

To answer all that, we need to start by talking heat transfer.

As anyone who’s ever tried to heat a draughty house will know, heat likes to transfer itself from warmer to colder; and as anyone who’s ever studied physics might remember, there only three main ways by which heat can be transferred:

  1. by convection, i.e., by air
  2. by radiation , i.e., by electromagnetic waves
  3. by conduction, i.e., by touch

And as anyone who has ever sat in front of an open fire will know, even when hot air is going up a chimney, if you turn your face to the fire you will still feel the fire’s heat, even from some distance away.

That’s the power of radiant heat. You can feel it too from the sun – heat transferred by electromagnetic waves across the vacuum of space, making it warm enough some days to sunbathe even in winter, from a heat source millions of miles away.

How we lose heat
How we lose heat to the environment

Now, transfer this knowledge to our own bodies, swaddled up on a winter’s night. Leaving aside sweating, i.e., evaporation (which is a nice-to-have on a cold winter’s night!) there are three ways our body loses heat.

  1. by convention, to colder air
  2. by radiation, to colder distant surfaces
  3. by conduction, to colder surfaces we’re touching.

Now, it’s obviously nice to have a warm floor so we don’t lose heat by conduction through our feet. But as you can see above, losing heat through our body’ peripheral parts is not our biggest heating problem (depending of course on which peripheral parts we’re talking about!). Mostly, we need to avoid losing excessive heat from our body’s core. And it turns out that we lose just over a third of our body’s heat by convection, lost to cold air, yet we lose nearly two-thirds of our body heat by radiation to colder surfaces.

That’s important.

So if heating people is not so much about keeping people warm, as stopping them cooling down – which it is -- then, paradoxically, we arrive at the conclusion that the very best way to warm someone most directly is to warm the surfaces around them.

Funny stuff, eh.

Do that right and we can create beautiful open spaces that feel perfectly comfortable to be inside in all weather, and we needn’t feel stuffy even in winter.

Got that? Because here’s the greatest misunderstanding that many people harbour about radiant heating: that you’re heating your floor in order to heat your air. That couldn’t be more wrong. You’re heating your floor to stop the people within losing their body heat to cold surfaces. Try using your floors to heat the air instead and you’ll still be as stuffy as buggery, and your power bills will start getting the extreme attention of your bank manager.

Because all these systems need to do is minimise the difference between the floor and our body temperature, which means radiant heat systems don’t even need to be turned up high to do their main job. Even a temperature of 18oC or so can be enough to make a room feel comfortable and, if we have heating pipes on our terraces, even melt all that snow. And because exposing skin to warmer surfaces exposes us more directly to radiation, we might even enjoy the experience in shirtsleeves.

It also, incidentally, makes a more comfortable temperature gradient for the human body (above), without the head copping the majority of our heat!

So, where did this idea of radiant heating come from?

In modern times, the idea came from Frank Lloyd Wright, who had it installed in his first Jacobs House (below) in 1936, in the cold midwest of Wisconsin. (The pic at right shows the necessary under-floor heating pipes laid out in the 1939 Pope-Leighey House).

The owner-builder liked it so much he installed it again in his second Frank Lloyd Wright house – in a place with even larger glass windows in an even less hospitable clime -- and Wright installed it in virtually every house and commercial building thereafter.

It not only liberated the buildings from heating appliances, it allowed large open spaces –and even open windows! – even on cold nights in frigid climates.

But the idea itself was ancient. Wright ran hot water in galvanised steel pipes in the first Jacobs House, but centuries before that the Romans had built fires to heat hollow ducts, or hypocausts, in walls and ceilings in homes, pools and their sacred buildings.

But Wright didn’t get the idea from them, at least not directly. He first encountered it in Japan where, in his patron Baron Okura’s otherwise frigid Japanese house there was a basement space they called “the Korean Room” to which everyone retreated of an evening. His account well describes the feeling of a good radiant heat system.

This room was about eleven by fifteen feet, ceiling seven feet [says Wright]. … We knelt there for conversation and Turkish coffee.
    The climate seemed to have changed [from the frigid rooms above]. No, it wasn’t the coffee, it was Spring. We were soon warm and happy again—kneeling there on the floor, and indescribable warmth. No heating was visible, nor was it felt directly as such. It was really a matter not of heating at all but an affair of climate.

The Baron’s interpreter explained that Spring was created by heating the floor in precisely the same way as the Roman hypocaust system. Wright immediately felt that it was such a natural way to heat a home, and almost immediately tried to incorporated what he called “gravity heat” into his new buildings. He enthused:



There are now as many different systems to choose from as there are misunderstandings about what the system is trying to do (even, I might even say especially, by many installers). But when you’re installing, or thinking of installing, a radiant heat system today, take comfort that you’re part of a legacy that goes back to the Romans, through Frank Lloyd Wright – and that by heating your concrete floor, you’re using the most efficient way to most directly heat a person’s body in open space.

Ypu’re installing heat superior even to that of the sun!  Even when it snows outside.

** Thanks for reading. I hope you’ve found this mini-tutorial a useful way to see an important element of modern architecture.**

[Pics from New-Learn Info, NBM,,]

Frank Lloyd Wright’s Brandes house, enjoying the snow

Quote of the Day: The wrong kind of growth

When I’m talking to students about Austro-classical ideas, they often ask “Why did Keynesianism win out?” Here’s one answer:

Why did the Keynesian faith win out? Economist salesmen like Keynes focused on the future, a perfect formula for the political class to use to drive growth well into the 1990s. This Keynesian message of growth via inflation and debt was also perfectly aligned with the message produced on Wall Street of ever rising earnings growth and stock prices. With the Keynesian revolution, however, also came debt, inflation, and progressively larger and larger financial and economic busts.

“Growth” via inflation and debt.That’s definitely been the wrong kind of growth.

Tuesday, 30 June 2015

Your ticket, your business #scalping

There’s been outrage –outrage! – about folk scalping their tickets for the Super 15 final.

Some folk are proposing “solutions.”

I say –as I’ve always said – that it’s your ticket, your business.

Good on You, Alexis Tsipras (Part I) #GreeceCrisis

Guest post by David Stockman

Late Friday night a solid blow was struck for sound money, free markets and limited government by a most unlikely force.
Namely, the hard core statist and crypto-Marxist prime minister of Greece, Alexis Tsipras, set in motion a cascade of disruption that will shake the corrupt status quo to its very foundations. And just in the nick of time, too.

After 15 years of rampant money printing, falsification of financial market prices and usurpation of democratic rule, his antagonists -- the ECB, the EU superstate and the IMF -- have become a terminal threat to the very survival of the kind of liberal society of which these values are part and parcel.

Keynesian central banking and the Brussels and IMF style bailout regime -- which has become nearly universal -- eventually fosters a form of soft-core economic totalitarianism. That’s because the former destroys honest financial markets by falsifying the price of debt.

So doing, Keynesian central bankers enable governments to issue far more debt than their taxpayers and national economies can shoulder. At the same time they force investors and savers to desperately chase yield in a marketplace where the so-called risk free interest rate has been pegged at ridiculously low levels.image

That means, in turn, that banks, bond funds and fast money traders alike take on increasing levels of unacknowledged and uncompensated risk, and that the natural checks and balances of honest financial markets are stymied and disabled.

Short sellers are soon destroyed because the purpose of Keynesian central banking is to drive the price of securities to artificially high and unnatural levels. At the same time, hedge fund gamblers are able to engage in highly leveraged carry trades based on state subsidized (free) overnight money, and to purchase downside market risk insurance (“puts”) for a pittance.

Eventually bond and stock “markets” become central bank enabled casinos -- riven with mispriced securities, dangerous carry trades, massive unearned windfall profits and endemic instability.

When an unexpected shock or “black swan” event threatens to shatter confidence and trigger a sell-off of these drastically over-priced securities, the bailout state swings into action indiscriminately propping up the gamblers.

That’s what the Fed and TARP did in behalf of Morgan Stanley and Goldman back in September 2008. And it’s what the troika did in behalf of the French, German, Dutch, Italian and other European banks, which were stuffed with un-payable Greek and PIIGS debt, beginning in 2010.

Needless to say, repeated and predictable bailouts create enormous moral hazard while extirpating all remnants of financial discipline in financial markets and legislative chambers alike. Since 2010, the Greeks have done little more than pretend to restructure their state finances and private economy, and the Italians, Portuguese, Spanish and Irish have done virtually nothing at all.

The modest uptick in the reported GDP of the latter two hopeless debt serfs are just unsustainable rounding errors. The numbers are flattered by the phony speculative boom in their debt securities that was temporarily fuelled by Mario Draghi’s money-printing ukase that is presently in drastic retreat.

This Monday morning push has come to shove; Angela Merkel and her posse of politicians and policy apparatchiks were not able to kick the can one more time after all.image

Instead, the troika’s authoritarian bailout regime has stimulated political revolt throughout the continent. Tsipras’ defiance is only the leading indicator and initial actualization -- the match that is lighting the fire of revolt.

But what it means is that there is now doubt, confusion and fear in the gambling halls. The punters who have grown rich on the one-way trades enabled by the money printing central banks and their fiscal bailout adjutants are being suddenly struck by the realisation that the game might not be permanently rigged after all.

So let the price discovery begin. In the days ahead, we will catalogue the desperate efforts of the regime to reassert its authority and control and to stabilise the suddenly turbulent casino.

In riding the central bank bubbles to unconscionable riches, the big axes in the casino have falsely claimed to be doing “God's work.”

As they are now being forced to liquidate these inflated assets, they actually are.

Last autumn one of the most detestable members of the regime, Jean-Claude Juncker, arrogantly issued the following boast:

I say to all those who bet against Greece and against Europe: You lost and Greece won. You lost and Europe won.”

This morning that smug proclamation is in complete tatters. Good on you, Alexis Tsipras.

David Stockman

David Stockman was director of the Office of Management and Budget under President Ronald Reagan, serving from 1981 until August 1985. He was the youngest cabinet member in the 20th century.
This article first appeared at the Daily Reckoning.

Reminder: Economics for Real People tonight … [updated]

I’m afraid students are still away on their mid-year break (insert obvious jokes here about the work ethic of modern students) so no regular Thursday event for another couple of weeks, but the Auckland Uni Econ group is still gathering tonight to co-host this event. Why not get along?


  • The prospect of ministerial discretion to strip citizenship without judicial review is just a tiny window into a much deeper problem.
        “For instance, Australian governments have vested more and more decision-making power outside Parliament and into “independent” bureaucratic agencies. These undemocratic, unelected officials have enough discretionary power to effectively make government policy. …
        “Gillian Triggs was right to say our democratic freedoms are under threat. Still, did she see any irony in the fact that the democratically elected Abbott government obviously wants to fire her but – since she commands an independent statutory agency – it cannot?”
    Unelected officials are stifling our democratic freedoms – THE AGE
  • “We often imagine that our modern concerns are distinct from those of the past.  But how much legislative power the executive could exercise without parliamentary approval was one of the great contests in the lead-up to the English Civil War.  The seventeenth century English historian Roger Twysden declared that “the basis or ground of all the liberty and franchise of the subject” was “this maxim, that the king cannot alone alter the law”.  Yet through executive pronouncements and delegation governments have vested vast legislative power in what scholars call “non-majoritarian” regulatory and bureaucratic agencies.””
    The Undone Tasks of Deregulation
  • So I read Chris Berg’s new book Liberty, Equality and Democracy. Very highly recommended. I loved it. In the book he makes the radical argument that people should be treated equally as individuals. He makes very clear that this is a radical argument.
        “The only time I disagreed with any point he was making was, I think, a typo. Indeed that is my only criticism of the book – there were several obvious typos and I expect the revised edition (or even second edition) should fix those.
        “Overall I was so impressed with the book that I imagine that one day some fine classical liberal will thump down the book and say, “This is what we believe”.”
    Book Review: Liberty, Equality & Democracy – Sinclair Davidson, CATALLAXY FILES

  • Classical liberalism, the tradition of free markets and individual liberty, has an outsider status in the Australian economics profession. This paper surveys the origin of Australian classical liberal economics in the nineteenth century, its sharp decline in the first half of the twentieth century, and its revival and growth in recent decades. Despite a period of successful market-oriented economic reform in the 1980s and 1990s, surveys suggest that classical liberalism is a minority viewpoint among Australian economists.
        “Currently the only critical mass of classical liberal academic economists in Australia is at RMIT University in Melbourne. …”

    Classical liberalism around the world – Rafe Champion, CATALLAXY FILES

UPDATE: Chris Berg appeared on TV3 this morning. (Warning, video contains traces of Paul Henry.)

[Click the pic for the vid, or click here.]

Have I “harmed” you? Tough shit.

Do you feel like you’ve been “harmed” by something I’ve said?

Think I’ve “criticised” or condemned” you?

You know what? Tough shit. Suck it up. Write me and talk it over. That’s what adults do.

That’s not the way your Government sees it, however. That’s not the way Injustice Minister Amy Adams and her boss John Key see it. That’s not the way it will be once their knee-jerk nannying new law comes into force. Below are the new ten commandments of blogland, courtesy of these ninnying net nannies.

Now, thanks to those two and all those voting with them, if I or someone else online causes you something called “serious emotional distress” – yes, Virginia, as of last Thursday that is now a recognised legal term – then you can legally hang me out to dry: doing me in to the government’s “approved agency,” and thence onward to the courts.

The penalty, if the courts find I’ve been critical or condemnatory are harsh. If MPs feel sad because of a blog post or media story, they can have the publisher jailed.

Frankly, if a political blog is not criticising or condemning, then it just isn’t doing its job. If it doesn’t make the Beehive bludgers feel uncomfortable, it should shut up shop -- and if Amy Adams doesn’t like that, she can get fucked.

If she feels “distressed” by that, she can write me a letter. And then fold it until it’s all sharp corners and post it where it’s most urgently needed.

NB: The “Harmful Digital Communications” third-reading debate resumes this week

PS: And if you’re wondering who gets to decide if she’s been harmed by what she’s read, who gets to start the gears and legal meat grinders going to protect her “emotional distress,” who gets to call you out by calling out the “approved agency’s” dogs, it’s this girl:

Embedded image permalink
[Pic borrowed from the very offensive Nicholas Ross Smith]

“The self-esteem equation”


Michael Hurd writes:

Most people assume self-esteem is a good thing. However, most people do not know what “self-esteem” actually is.
    Most probably assume that self-esteem refers to feeling good about yourself. That’s not wrong. But exactly how does one arrive at feeling good about oneself?
    No answer is ever given. Teachers, counsellors, and many parents of young children often assume, “If you just tell the child good things about him- or herself, the child will feel good.”
    But such an approach is wrong. It’s indiscriminate. It teaches young children that they’re good — actually, great — no matter what.
    It’s basically a lie. Or at least a half-truth. Parents and teachers won’t criticize, not even constructively. This is just as bad as always putting down a child, never building the child up or telling him what he does well.
    The child comes into young adulthood with a sense that everyone should be telling him or her how great he or she is. After all, that’s what all those teachers did. That’s what parents often did. “So why isn’t the rest of the world greeting me that way?”

Read on here: The Self-Esteem Equation

Frédéric Bastiat’s ‘Economic Sophisms’ is Now More Important Than Ever

Frédéric Bastiat’s Economic Sophisms was the first book on economics I ever found worth the reading. So I’m delighted to say that:

Frédéric Bastiat’s Economic Sophisms is Now More Important Than Ever
Guest post by Julian Adorney and Matt Palumbo

The great economist Frédéric Bastiat would have turned 214 today. His contributions to liberty have been many, but while so many advocates of free markets focus on The Law there is another book that represents his legacy even better: Economic Sophisms. This short work of essays epitomises perhaps his most important contribution: using taut logic and compelling prose to bring the dry field of economics to hundreds of thousands of laymen.

Bastiat did not, generally, clear new ground in the field of economics.1 He read Adam Smith and Jean-Baptiste Say and found little to add to these giants of economic thought. [Ahem - Ed.] But like Richard Cobden, his English hero, Bastiat was active in promoting their free trade doctrines – and was possessed with the keen wit and clear, pithy writing style that gave them wings. His writings have become immensely popular. One-hundred-and-fifty years after his death, essays like “A Petition” are still circulated as an effective counter to progressive economics.

Bastiat makes three central contributions in Economic Sophisms.

First, he reminds us that we should care about the consumer, not just the producer.

Second, he dismantles the argument that there are no economic laws.

Third, and more generally, he is one of the few politicians and writers who thought with his head, not with his heart. Bastiat used logic to clearly lay out the consequences of political actions instead of hiding behind good intentions.


Surplus, Not Scarcity

Economic Sophisms expresses a common theme over and over again: we should craft policies that focus on consumers, not on producers.

When Bastiat uses these phrases, it can be easy to misinterpret him. Writing 100 years after Bastiat, Keynes hijacked the terms without the integration. Bastiat was no Keynesian. When Bastiat discusses how consumption is the end goal of the economy, what he means is: having goods (which benefits consumers) is more important than making goods (which benefits producers). Put another way, producers prefer scarcity, because it drives up prices. Consumers prefer surplus for the opposite reason.

Producers advocate all sorts of methods for reducing the total quantity of goods (theirs excepted, of course). Producers seek to tax goods from other countries that compete with their own. They outlaw machines that would replace them. Producers even favour policies like burning food to drive up food prices, a policy that caused much starvation when it was enacted in the United States during the Great Depression. Consumers, by contrast, prefer abundance. They are happiest when they have a plethora of goods to choose from at a low price.

Bastiat points out that we are all consumers, including the producers. The man who produces railroads also uses his wages to buy goods. One might imagine a world with no producers, a paradise in which man’s every need is fulfilled by nature or a benevolent God. But one cannot imagine a world with no consumption. In such a world, man would not eat or drink, have clothing or buy luxuries. Consumption, and quality of life, is the essential yardstick to measure a society’s economic prosperity.

When we enact producer-backed measures like tariffs, Bastiat argues, we favour producers’ interests over consumers’. We show that we’d rather have scarcity than surplus. Taken to its logical extreme, such a policy is absurd. Would anyone truly argue that total scarcity is preferable to having plenty?

The Principle of No Principles

In Bastiat’s day, it was fashionable to claim that no real principles exist. X may cause Y, but a smaller X needn’t cause a smaller Y; it could cause Z instead, or A. Today, we see the same logic: people who claim, for instance, that a minimum wage hike to $100 would kill jobs but that a hike to $10.10 would somehow create them.

In essay after essay, Bastiat destroys this myth. Economics is not a foggy morass where up is sometimes down, left can be right, and there are no absolute truths. Economics is not like nutrition, where a glass of wine can heal while two gallons can kill.

In economics, a cause will produce a correlational effect, regardless of how large the cause is. If small X causes small Y, large X causes large Y. A minimum wage hike to $100 will kill many jobs; a minimum wage hike to $10.10 will still kill some. The effect does not vary, only the size of it.

Indeed, one of Bastiat’s most common argumentative tools is reductio ad absurdum, or carrying a concept to its logical conclusion. Opponents of mechanisation want to force railroads to stop at one city and unload goods, thereby generating work for the porters? Very well, says Bastiat. Why not have them stop at three cities instead? Surely that would generate even more work for the porters. Why not stop at twenty cities? Why not have a railroad composed of nothing but stops that will make work for the porters – a sort of “negative railroad”?

By carrying concepts to their logical conclusion, Bastiat provides a firm antidote to the fuzzy thinking of protectionist advocates.

Think with Your Head

In Bastiat’s time, just as today, it was popular to think with one’s heart. “We must do something!” went the rallying cry; “this is something, then we must do it!” And never mind the consequences. Good intentions were enough.

Make-work, for instance, has always been a favourite policy of those who think with their hearts. They see men and women unemployed and demand government take action. Often, this action takes the form of impeding human progress: using porters instead of railroads, for instance. The initial consequence, for the porters, is positive: more end up employed. But Bastiat recognises that such policies, while they may protect the porters, harm the economy as a whole. They raise prices and create scarcity.

Bastiat looked at more than just the direct consequence of an action. He examined all the outcomes, using taut chains of logic to demonstrate how each policy would impact those whom he was most focused on — the consumer.

Bastiat’s Legacy

Bastiat did not invent any new economic tools or schools of thought1. But the clear logic with which he thought through economic ideas, and the clear and witty prose with which he lambasted those who did not do so, have made him one of the most popular economic figures of all time.

Bastiat’s ideas in this text have been borrowed, rehashed, and republished for over 150 years. His insights have been appropriated by dozens of prominent thinkers. Most famously, Henry Hazlitt based Economics in One Lesson largely on the essays in Economic Sophisms.

As we make note of his 214th birthday, perhaps we should raise a toast to the man whose ideas — in all their adopted formats — have done so much for the cause of liberty.


Julian Adorney is an economic historian, entrepreneur, and fiction writer.
Matt Palumbo is the author of The Conscience of a Young Conservative and In Defence of Classical Liberalism.
This post first appeared at the Mises Daily.


1. “…did not, generally, clear new ground in the field of economics”? Bastiat was perhaps the first to concisely explain that economics necessitated long-chain thinking, without which we are all dead. Those who grasp his point would surely disagree, as would students of his Economic Harmonies, of his anatomy of plunder, and of his ricochet theory, among other contributions.- Ed.

Modern Critics of Keynes

Steven Kates is compiling a new book called Modern Critics of Keynes, a combined updated of and tribute to Henry Hazlitt’s much earlier and similar compilation Critics of Keynesian Economics, a confirmed classic. Problem is, says Kates, that there are hardly any critics today.

“These are economists who have each already written extensive critiques of Keynesian economics. If you can think of more than two, please add their names to the comments.”

Well, in no particular order, I can think of these folk... 

Montessori School, by Organon Architecture


So some of you have been suggesting I start posting more regular art and architecture posts again. And others have suggested I post more of what I’m designing myself.

So at the risk of boring my other reader, and the troll, here’s something that’s on the board at the moment: a new Montessori school, with 3 classrooms, quiet decks, parents space, shared kitchen, internal garden ...