Ray,
I know that you have experienced many things. So have I. I have presented the evidence of structural unemployment to senior govt officials only to have their eyes glass over as they rejected the facts. I have seen "yes minister" in action. It is easy to criticize from the outside looking in. And I have read your accounts of your past and what has been done to your people so we don't have to go through that again. Lets focus on what is and where we can go from here rather than imagining a whole new society. Although fun to do, and is a game any number can play it really doesn't get us anywhere. It just breeds frustration and unhappiness, precisely where you say that you don't want to go. arthur From: [email protected] [mailto:[email protected]] On Behalf Of Ray Harrell Sent: Monday, January 17, 2011 1:24 PM To: 'RE-DESIGNING WORK, INCOME DISTRIBUTION, EDUCATION' Subject: Re: [Futurework] The 'New Normal' of Unemployment Mere jobs as the point of life goes back to Henry Ford and his assembly line. What has happened to imagination and creativity Arthur? Does it only speak Chinese in the 21st century? Groupthink is a system's pathology like schizophrenia. You have to NOT give your loyalty to the Ant world. What happened to the Mensch? Today the greatest concert halls, opera houses and architectural projects are being built in Asia. Why not pay a musician to play a concert that stimulates humanity in all of its aspects and creates eleven dollars of stimulus for every dollar invested? When Reagan's panel to disband the National Endowment of the Arts truly looked at the economics of the Arts Reagan decided to advance the budget rather than disbanding the agency because of the bargain compared to other programs. Reagan should have known that but didn't since he didn't realize that the economics of the Movies rescued the entire American balance of payments deficit according to Edward Deming. Why is a symphony that hires people for fifty years worth less than a computer store that, like the auto industry must create fake newness and use up materials for its existence? The problem is value. You have to value concert pianists, singers or movies, you have to stop valuing what destroys rather than what renews the human spirit and stimulates growth through imagination. Don't be stuck in the mineral world or what translates into English as the "Telestial" world. You have to rediscover the "Terrestrial" world and its values and make it into the "Celestial" world for the fulfillment of the meaning of your existence. Obviously Arthur, the "you" is not Arthur Cordell or anyone else on this list. I only know your words and I respect your expertise with questions. The "you" is all of us who get trapped in the mineral lower world of lower thinking. We cannot escape personal or group pathologies unless we are better than that. I'm saying that Economics has to grow up and be responsible. The current fad with game theory and winner take all is just plain old evil or as some people call it "sin." It's not my religion or culture but I certainly get their point. Actually I believe it to be a pathology like the shooter in Tucson. Henry Ford's dogma led him to Hitler and affirmation of the Reich. Doesn't that cause any questions about the current stories in fashion? Do you think the economists in the Chinese government take refuge in stories when their programs fail? REH From: [email protected] [mailto:[email protected]] On Behalf Of Arthur Cordell Sent: Monday, January 17, 2011 8:04 AM To: 'RE-DESIGNING WORK, INCOME DISTRIBUTION, EDUCATION' Subject: Re: [Futurework] The 'New Normal' of Unemployment Job creation is simple. Instead of cars becoming junk after 11 years or so just have them become junk after about 5 years. Create jobs. Deplete resources. Economists are the "handmaidens" of the particular political system in which they function (in some ways the same as sociologists, and other "ists" like psychologists), but this is a much longer story. "bafflegab, pseudo scientific academic neutrality and ideological posturing" is found in most of the social "science" disciplines. At least those that seek funding and those that live under some sort of state protection however removed, even as vague as wanting to get grants so the "scientists" can continue their "work".... The tendency to group thinking extends to the natural sciences in many instances, although here the boundaries are set not by the state but by the established actors who feel threatened by new thinking. From: [email protected] [mailto:[email protected]] On Behalf Of Michael Gurstein Sent: Sunday, January 16, 2011 10:21 PM To: 'RE-DESIGNING WORK, INCOME DISTRIBUTION, EDUCATION' Subject: Re: [Futurework] The 'New Normal' of Unemployment Hmmm... and relieving unemployment isn't a "competing use" and deciding on the priorities among those "competing uses" using econometric bafflegab, pseudo scientific academic neutrality and ideological posturing isn't the main activity of mainline economists... M -----Original Message----- From: [email protected] [mailto:[email protected]] On Behalf Of Arthur Cordell Sent: Sunday, January 16, 2011 6:26 PM To: 'RE-DESIGNING WORK, INCOME DISTRIBUTION,EDUCATION' Subject: Re: [Futurework] The 'New Normal' of Unemployment This article contains many flaws. Economics is about the allocation of scarce resources among competing uses. It is not about solving unemployment problems or job creation, although economists can do this. Other people can also deal with unemployment and job creation. That the problem of deficits is old thinking is an ideological statement. All I can say is: Stay tuned. Arthur From: [email protected] [mailto:[email protected]] On Behalf Of Robert Stennett Sent: Sunday, January 16, 2011 1:51 AM To: EDUCATION RE-DESIGNING WORK INCOME DISTRIBUTION Subject: [Futurework] The 'New Normal' of Unemployment http://www.commondreams.org/view/2011/01/15-2 Published on Saturday, January 15, 2011 by the Guardian/UK <http://www.guardian.co.uk/commentisfree/cifamerica/2011/jan/14/economics-ec onomy> The 'New Normal' of Unemployment by Dean Baker The American Economics Association <http://www.vanderbilt.edu/AEA/> held its annual meeting in Denver last weekend. Most attendees appeared to be in a very forgiving mood. While the economists in Denver recognized the severity of the economic slump hitting the United States and much of the world, there were few who seemed to view this as a serious failure of the economics profession. The fact that the overwhelming majority of economists in policy positions failed to see the signs of this disaster coming, and supported the policies that brought it on, did not seem to be a major concern for most of the economists at the convention. Instead, they seemed more intent on finding ways in which they could get ordinary workers to accept lower pay and reduced public benefits in the years ahead. This would lead to better outcomes in their models. The conventional wisdom among economists is that the economy will be forced to go through a long adjustment process before it can get back to more normal rates of unemployment. The optimists put the return to normal at 2015, while the pessimists would put the year as 2018, and possibly, even later. Furthermore, many economists believe that the new normal will be worse than the old normal. The unemployment rate bottomed out at 4.5% before the housing bubble began to burst. If we go back to 2000, the United States had a year-round average unemployment rate of just 4.0%. The optimists now envision that normal would be 5.0% unemployment, while the pessimists put the new normal at 6.0% unemployment and perhaps higher. As a point of reference, every percentage point rise in the unemployment corresponds to more than 2 million additional people without jobs. The willingness of economists to so quickly embrace this darker future is striking. After all, one of the reasons that we have economists is, ostensibly, so that we don't get such unpleasant news about a "new normal". This is like a football team calmly accepting the sports writers' prediction that they would have a winless season, and deciding that their new goal was to minimize the margin of defeat. The prospect of an extended period of higher unemployment would be easier to accept if there was a good argument as to why the economy cannot achieve the same levels of employment as it had in the recent past. Economists really don't have much basis for this lowering of expectations of their own and the economy's performance. The main argument seems to stem from the work of two economists, Carmen Reinhart <http://terpconnect.umd.edu/%7Ecreinhar/> and Ken Rogoff <http://www.economics.harvard.edu/faculty/rogoff/Biography_Rogoff> , who have examined financial crises around the world. Their analysis finds that, in most cases, it has taken countries roughly a decade to recover from the effects of a financial crisis and return to a more normal growth path. There is an important limitation in the Reinhart and Rogoff analysis <http://press.princeton.edu/titles/8973.html> . Most of the crises they examine were in the distant past, before the development of modern economics and its bag of tools. If the thousands of economists gathered in Denver know anything more about economics than those not educated in the field, then it would be reasonable to expect better outcomes than in prior centuries. After all, through most of human history a large portion of children died in their first years of life. However, with modern medicine and good nutrition, infant mortality is a rare event in wealthy countries. By the Reinhart and Rogoff extrapolation, we would still expect most children to be dying before the age of five, based on the historical experience. The methods for generating demand are not a mystery. It basically amounts to the government spending more money until the private sector is again in a position to fuel demand. The fears of deficits and debt that the pessimists promote stem from a misunderstanding of basic economics. Deficits can be a problem when they crowd out private economic activity. In a severe slump like the current one, this crowding-out is not a realistic fear; there are vast amounts of idle resources. Furthermore, there is no reason that the debt needs to pose an interest burden on taxpayers in the future. The Fed and other central banks can simply buy and hold the debt, refunding the interest payments to the government <http://www.nytimes.com/2011/01/11/business/economy/11treasury.html?ref=busi ness> . If economists did their job, they would be pushing policies to get the economy quickly back to full employment. Instead, they just repeat lines about how "we" will just have to accept some rough times. Unfortunately, no one ever asks the economists who preach austerity how much time they expect to spend in the unemployment lines. If they don't know anything, then why should we listen to them? C 2011 Guardian/UK Dean Baker <mailto:[email protected]> is the co-director of the Center for Economic and Policy Research <http://www.cepr.net/> (CEPR). He is the author of The Conservative Nanny State: How the Wealthy Use the Government to Stay Rich and Get Richer <http://www.amazon.com/dp/1411693957?tag=commondreams-20&camp=0&creative=0&l inkCode=as1&creativeASIN=1411693957&adid=1Q1525S4DMNAXAYFQ8EV&> ( www.conservativenannystate.org <http://www.conservativenannystate.org/> ) and the more recently published Plunder and Blunder: The Rise and Fall of The Bubble Economy <https://www.amazon.com/dp/0981576990?tag=commondreams-20&camp=0&creative=0&; linkCode=as1&creativeASIN=0981576990&adid=1RZEQ5WA6XE33K5W9Q5P&> . He also has a blog, "Beat the Press <http://www.cepr.net/index.php/beat-the-press/> ," where he discusses the media's coverage of economic issues.
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