FEER: A False Dawn (E. Asia)
A False Dawn Changing economic conditions may mean that the region's much-touted recovery from crisis is largely an illusion By Henny Sender/HONG KONG and TAIPEI Issue cover-dated July 27, 2000 THREE YEARS AFTER the Asian Crisis officially erupted with the devaluation of the Thai baht, the region's unfinished agenda for reform is evident from Japan to Jakarta. The U.S.-dollar debt that got Asia into trouble originally hasn't gone away; it has merely been obscured by benign global economic and monetary conditions. Those favourable conditions have enabled the region to earn hard currency by exporting its output to the United States and Europe, and made it possible for Asian central banks to lower interest rates while keeping their currencies relatively stable. But while some short-term debt has been converted to longer-term borrowings and some has been changed from dollar debt into local-currency obligations, the absolute debt in Asia outside Japan has hardly changed in more than two years--it is still more than $600 billion. In the two years to December 1999, central-bank reserves in the region grew by almost $260 billion, and the region's trade balance shifted from a deficit of $40 billion to a surplus of $80 billion, according to data from Morgan Stanley Dean Witter in Hong Kong. But given that the macroeconomic outlook and interest rates are expected to be far less friendly in coming months--as global growth slows and rates continue to move up--not dealing with the debt overhang is especially dangerous. Asia can no longer count on simply growing out of its debt leverage. In short, there has to be more restructuring to cut costs, and more asset sales. That isn't a message that's likely to be welcomed. "Asia needs to make a distinction between leveraged corporates which are viable and those which are not viable," says Sun Bae Kim, managing director at Goldman Sachs in Hong Kong. "And for those which aren't viable, an exit strategy and bankruptcy have to be considered. And that requires pain." But to introduce such distinctions strikes at the heart of entrenched interests and the complicated intertwining of political and economic power in the region. First on the agenda: Asia has to develop a balanced financial structure in which banks, the bond market and the equity market all function and all allocate capital to those who can use it most efficiently. In the recent past, equity markets have been buoyant enough to compensate for weakness in banks, but now the stockmarkets can no longer be relied on. And some analysts, such as Chris Francis, who recently moved to London from Hong Kong to head global credit analysis for stockbrokers Merrill Lynch, contend that governments still haven't done enough to develop their bond markets. "Governments have continued to stifle their bond markets," he says. "They don't want to see new markets which they can't control; markets where capital can leave." He points out that governments could have floated more public debt as part of their bank recapitalization plans; instead, they chose to issue bonds directly to banks in exchange for troubled loan portfolios. Meanwhile, progress on dealing with the debt in a definitive manner remains uneven, and across Asia--with the honourable exception of Taiwan--the inability to distinguish between those who deserve to be saved and those who don't continues to be a matter of politics rather than letting markets decide. Taiwan has become an example of how things can be done. The island has no shortage of either entrepreneurs or venture capitalists. And there is ample money--now more than ever before, thanks to Taiwan's flourishing hi-tech companies. That money flows to companies that use it to move up the value-added chain in manufacturing and manufacturing services and to take Taiwan from being low-cost efficient to leading-edge awesome. But elsewhere the corporate wreckage is piled up. Cases ranging from Indonesian state-owned shipbuilder Dok Perkapalan Koja Bahari to the now finally bankrupt Japanese retailer Sogo underscore just how much trouble Asia has in saying, whether through the courts or the government: "Thou shalt not be saved." The amounts owed to foreign creditors--and in dispute--in the case of the Indonesian shipbuilder aren't large: only $11 million. But the fact that the case has come up at all underscores just how stubbornly in denial some entities are. In the Jakarta dispute, the shipbuilder claims that the promissory notes it issued to European and Asian banks don't comprise legitimate company debt; the funds, it says, went instead to the directors whose names were on the documentation. The case is now in a Jakarta court. Despite very different circumstances, the case of Sogo conveys a similar message, though at least the effort at denial has been thwarted. The fact that at last the company is being allowed to die ends efforts to set up a $6 billion bailout, to have been led by the government. The
Re: Re: Re: summary of calculation debate
En relación a [PEN-L:22144] Re: Re: summary of calculation deba, el 23 Jul 00, a las 21:56, [EMAIL PROTECTED] dijo: I would not deny the superiority of planning as a tool of development from a predominantllya gricultural economy to a more industrialized one. Planning worked well, though hardly less savagely, for that end in the USSR too. It was when a moderate level of industrialization was attained that returns started to fall off. True, but bluntly conventional wisdom. Hayek's criticisms, which Justin seems to agree with, were more serious than that. In his idea, planning was utterly impossible, which is reasonable if you are seriously clinging to individualism as a methodological paradigm. If you begin by the assertion "people are atoms" you end up rejecting planning as such. It is the problem of the size of the fish you catch: it depends on the net you are using. But let us return to JKS/ s assertions (much to Doug's tranquility, I will try not to blandish the scarecrow of the dead dead dead USSR). The basic idea, which starts the road towards justification of the demise of the Soviet government and Western occupation (in economic terms) of the East, is that planning began to bear sour fruits once a more sophisticated economy appeared. The problem here is that though the ailment is shown, the ethiology is automatically adscribed to planning itself, with no care to other reasons. Would the lack of democracy among the workers have something to do with this kind of planning? And would the hostile encirclement, which was the basic condition of existence of the USSR since its very birth, have something to do with this lack of workers democracy? It would be a very instructive exercise to imagine the economy of, say, the USA, operating for eighty years in the hostile environment that the USSR had to operate in. I am not at all defending "planning as such". I am just asking those who attack it whether they are not slanting things more than a little bit when they compare the operation of that system with the operation of "capitalism" without paying adequate interest to the completely different conditions under which both systems worked. On this, I agree with Doug in that we cannot obtain conclusions from the experience of the USSR as such, but on the experience of a strongly bureaucratized experiment in socialism under conditions of deadly encirclement by the most powerful countries on Earth. Once this set of particular conditions is sifted away, I think we may profitably begin to talk about the "undeniable" shortcomings of planning. Néstor Miguel Gorojovsky [EMAIL PROTECTED] NUEVA DIRECCIÓN ELECTRÓNICA DESDE EL 10 DE JULIO DE 2000 NEW E-ADDRESS AS OF JULY 10, 2000 [EMAIL PROTECTED]
Re: Finishing the debate
Since we do not seem to be able to communicate, I am dropping the subject. A final explanatory word: 1. The Soviet Union "failed" years before it collapsed. It had promised a better alternative to advanced capitalsim and failed to deliver. It would have failed had it not fallen and if it still existed. 2. I offered what I considered to be evidence and arguments that the problems with Soviet planning were due to planning and not to lack of democracy. These were three in main: (a) the fact that the Hayek calculation arguments predict exactly the problems that happemned with Soviet planning, and those arguments do not depend on lack of democracy as a premise; (b) as a corollary, the argument that democracy woukd make the planning problem worse, because the planning system could not handle information adequately, and democracy would, ex hypothesi, increasre thea mount of information to be handled; (c) the empirical fact that Soviet planners themselves saw that the system was plagued with the calculations problem--not necessarily so called, as many of them never heard of Hayek; this is easily confirmed if you refer to any study of Soviet planning, e.g., Michael Ellson's Socialist Planning, 2d ed., Abram Bergson, Soviet Planning; Ed Hewett, Reforming the Soviet Economy. Apparently! ! you consider tese arguments not be arguments. OK, we don't have the same conception of what counts as an argument. I am done here. --jks In a message dated Sun, 23 Jul 2000 10:16:10 PM Eastern Daylight Time, Michael Perelman [EMAIL PROTECTED] writes: Let me see if I understand you correctly, Justin. I got the following assertions distilled from year earlier notes. Planning works for an underdeveloped country. The Soviet Union did not fail because of planning, but it could not have kept up with the West. I mentioned earlier that I believed that the Soviet Union grew faster than the United States in all years except when it was being invaded. Jim Devine has been repeating what many of us believe that the planning in the Soviet Union, to the extent that it was deficient, failed because of an absence of democratic input into the plan. You argue that the problem was planning per se. You have no evidence to refute what Jim said. He has none that can refute your perspective. What we have are just different interpretations of the same phenomenon. Merely to repeat that the Soviet Union failed because of planning doesn't get us anywhere. Just because nobody to my knowledge has become convinced by your argument doesn't mean that they weren't listening, anymore than your adherence to your own views proves that you weren't listening. Some people who have not responded to things that you wrote, just as you haven't responded adequately to those people who brought up the informational problems that Hayek ignored. Please, unless we can cover some new ground let's drop the subject. -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail [EMAIL PROTECTED]
summary of calculation debate
[EMAIL PROTECTED] 07/20/00 11:09PM In a message dated 7/20/00 10:28:04 PM Eastern Daylight Time, [EMAIL PROTECTED] writes: Hayek should have to point out that real markets are dynamic and have nothing to do with static equilibrium equations--or am I misunderstanding Hayek? Absolutely correct. Although he neglects the problem with handling dynamic information in his own theory. He assumes that static prices convey sufficient information. This misses H's point about the entrepreneur. The E doesn't just look at prices. He goes out and gets information about what peiople want, _ CB: This is not the whole picture. The Entrepreneur spends a lot of time trying to make people want what "he" has got to sell. Maybe more money is spent on controlling people's wants than "discovering" them. The most powerful corporations spend a lot of time trying to defeat or destroy their competitors regardless of whether people WANT what their competitors sell. _ what resources there are, what concrete means exist to satisfy these needs. He relies on price information,a nsd expects others to, because (the Hayeklian point) no one can know as much about everything as he does about his little bit. But H's system runs on entrepreneurial knowledge, not on price crunching. It is because markets encourage entrepreneurship that H is so keen on them. --jks
Snap Quiz
Essay question: 1. What is the role played by 'planning' and 'markets' in the following story? BRUSSELS, July 24 (Reuters) - The European Union on Monday launched a broadside against proposed U.S. legislation which could block Deutsche Telekom AG from buying U.S. cellphone group VoiceStream Wireless Corp. European Commission spokesman Michael Curtis said a measure to close a loophole permitting acquisitions of U.S. telecoms firms by foreign companies that are more than 25 percent state-owned would set a "negative precedent" if it became law. The measure, proposed by U.S. Senator Ernest Hollings, would have WTO (World Trade Organisation) implications, Curtis said. "If this bill were to be adopted it would restrict foreign ownership in U.S. telecoms firms, which is contrary to commitments undertaken by the U.S. in the WTO," he told the Commission's daily news briefing. The warnings flew as Deutsche Telekom, the telecommunications giant which is majority owned by the German government, announced a $50.7 billion takeover of VoiceStream. Temps Walker Sandwichman and Deconsultant
Re: Re: Re: summary of calculation debate
At 04:20 PM 7/23/00 -1000, you wrote: There is a substantial amount of industry in state hands, some of which remains in a state of operation that relies little on profit motive, yet there is a clearcut campaign by the CCP to turn state industries into market competitive industries to resolve crises of over production that are endemic not only in China but most of East Asia at the moment. given the competitive effort to keep wages down relative to productivity that's prevailing in East Asia and an increasing fraction of the rest of the world, wouldn't a "clearcut campaign by the CCP to turn state industries into market competitive industries" make underconsumption and thus over-production tendencies worse? it might help with sectoral problems, but the "race to the bottom" encourages macro problems. Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~jdevine
Re: Re: Re: Re: summary of calculation debate
At 08:20 AM 7/24/00 -0300, you wrote: It would be a very instructive exercise to imagine the economy of, say, the USA, operating for eighty years in the hostile environment that the USSR had to operate in it's interesting to note that in the periods during the 20th century when the US felt only mildly encircled by hostile powers (i.e., World Wars I and II), the US economy was converted to a planned one. Planned capitalism did pretty well in terms of helping the US win WW II. Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~jdevine
Re: market socialism, etc.
JD writes: Marx distinguished an "industrial capitalist" (i.e., the capitalist who organizes production) from capitalists in general (those who own the means of production). This is not the same as the distinction between the entrepreneur and the capitalist, but it is close. No, it is not close - as is obvious in the dismissive (marxist) remarks which you and others in pen-l have made about entrepreneurship. Further, he talks about innovation (the activity which distinguishes the "entrepreneur" in Austrian lingo), though I don't think he uses that word. (The distinction seems an "Austrian" innovation.) For example, in chapter 12 of volume I of CAPITAL, he talks about one capitalist introducing an new way of producing things and how it is then imitated by other capitalists, due to the coercive force of competition. But the Austrian would never say "coercive force of competition" - and this is a crucial distinction - since for them it is not a matter of a *structure* pushing you do do something which you might otherwise not want/desire to do. Marx's emphasis is on _process_ innovation (rather than product innovation), The Austrians put a big emphasis on prices as signals (of tastes scarcity). My understanding of Marx is that one of the bases of his crisis theory is that these signals are wrong in the sense that they do not allow "entrepreneurs" to coordinate to prevent underconsumption and the like. Prices cannot provide an understanding of the nature of the capitalist totality and the conditions needed for its harmonious expanded reproduction over time. Instead of gradual change, we see "equilibration" through sharp crises. Schumpeter, on the contrary, minimizes the role of prices in innovation. Emphasis on prices gives the impression that capitalists/entrepreneurs are always passively responding to market signals. But S's concept of "creative destruction" activates the capitalist - at the micro-economic level - in a way that M's theory could never do, since, for starters, M has micro-economic analysis. S writes: "Economists are at long last emerging from the stage in which price competition was all they saw. As soon as quality competition and sales effort are admitted into the sacred precints of theory, the price variable is ousted from its dominant position. "In capitalist reality [what counts is] the competition from the new commodity, the new technology, the new source of supply, the new type of organization..." S never failed to praise M for his emphasis on the dynamic quality of capitalism, that cap "can never be stationary", but criticises him for viewing the capitalist as a mere personification of capital, rather than as an *agent* who understands his own actions and is consciously, willingly engaged in the market. The word "rational" in economics is basically a theoretical fiction. It is heuristically useful. You seem to confuse two meanings of rationality, formal and substantive, in the use of the value- judgement "narrow-minded individualistic..." in your definition of economic rationality. It is interesting to note that for Weber capitalism was irrational at the substantive level. I don't know about S, but using the word "rational behavior" does not imply undue emphasis on individuals - as Michael Perelman narrowly thinks as well - since we are talikng about rational behavior as a pattern or sequence of behavior. No reason to keep fighting the intellectual ghosts of the 50s. Marx believed, I think, that a holistic approach was superior to an individualistic approach. That is, he made a sociological statement that certain kinds of societies produce certain kinds of attitudes. Thus, he saw capitalism -- and specifically the societal environment of capitalist competition -- as encouraging narrow-minded individualistic profit-seeking (one vision of "rationality"). If Marx is seen as explaining the basis for profit-maximization, then all the results derived from that assumption can be accepted by Marx (as long as unreasonable auxiliary assumptions aren't introduced). Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~jdevine
Re: Snap Quiz
Essay question: 1. What is the role played by 'planning' and 'markets' in the following story? Answer: If you're in the US, it's 'markets', obviously. All the government is doing is keeping the dead hand of (some other) government out of otherwise undistorted free markets. If you're in Europe, it's 'planning', as the dead hand of (some other) government is distorting free markets. These assessments, uncontentiously correct though they are, remain provisional, however - as four medium-term possibilities arise; themselves giving rise to a wide spectrum of appropriate reappraisals: (a) If, five years down the track, the companies had not merged, and both had done well, then this would have proven markets work. (b) If, five years down the track, the companies had merged, and had done well, then this too would prove markets work. (c) If, five years down the track, the companies had not merged, and one or both had not done well, then this would prove planning doesn't work. (d) If, five years down the track, the companies had merged, and had not done well, then this too would prove planning doesn't work. * Note: This is not to take a position concerning the argument and arguers on Pen-L of late - just my position on mainstream business-sheet economists, who have never, as far as I can remember, been wrong - their theory having been unambiguously vindicated by each and every event of each and every of the last million years. How'd I do, Sandwichman? Rob. BRUSSELS, July 24 (Reuters) - The European Union on Monday launched a broadside against proposed U.S. legislation which could block Deutsche Telekom AG from buying U.S. cellphone group VoiceStream Wireless Corp. European Commission spokesman Michael Curtis said a measure to close a loophole permitting acquisitions of U.S. telecoms firms by foreign companies that are more than 25 percent state-owned would set a "negative precedent" if it became law. The measure, proposed by U.S. Senator Ernest Hollings, would have WTO (World Trade Organisation) implications, Curtis said. "If this bill were to be adopted it would restrict foreign ownership in U.S. telecoms firms, which is contrary to commitments undertaken by the U.S. in the WTO," he told the Commission's daily news briefing. The warnings flew as Deutsche Telekom, the telecommunications giant which is majority owned by the German government, announced a $50.7 billion takeover of VoiceStream. Temps Walker Sandwichman and Deconsultant
KRUGMAN WATCH: foreign take-overs foreign aid
July 16, 2000 / New York TIMES RECKONINGS / By PAUL KRUGMAN Who's Acquiring Whom? For those of us who remember the great wave of foreign investment in the United States between 1986 and 1990, it's starting to feel like déjà vu all over again. ... I'd like to think that there's more going on here than good old-fashioned American arrogance. We are a more sophisticated nation than we used to be -- better traveled and more aware of the world outside. And maybe, just maybe, we are even sophisticated enough to understand and accept the idea that globalization is a two-way street. I didn't find PK's column comparing the US response to foreign purchases of US capital now to that of the 1980s to be very interesting and thus have no comments on it. I do think that the phrase "déjà vu all over again" should be retired post haste. -- July 19, 2000 / New York TIMES RECKONINGS / By PAUL KRUGMAN Delusions of Generosity Mr. Clinton," declared the full-page ad in yesterday's New York Times, "the American people would rather spend $40 billion to rescue Social Security than to rescue your legacy." The ad denounced the possibility that an agreement at Camp David might include substantial promises of aid to the Palestinians. Then it referred interested readers to the Web site of Americans for Responsible Foreign Spending, which -- like the ad itself -- gives absolutely no hint about who these "Americans" might be. There are no names of officers, no endorsements of the group by named individuals. Nothing in the ad or on the Web site refutes the hypothesis that the group is actually a front for Islamic militants, out to sabotage the negotiations. But I doubt it. After all, the supposed conflict between foreign aid and Social Security has been the subject of a steady stream of press releases from House Republican leaders. For example, last year the office of Tom DeLay, the majority whip, declared that "the president's requests for foreign aid would directly raid the Social Security trust fund." (Directly? Let's just say that Mr. DeLay's definition of "direct" is even further from common usage than Mr. Clinton's definition of "sex"). It's a pretty safe guess, then, that this is just hardball domestic politics -- though the peculiarly self-effacing behavior of Americans for Responsible Foreign Spending suggests that they fear that even today's hardened voters might look askance at politicians willing to undermine sensitive peace negotiations for the sake of partisan advantage. ... this column is another ho-hummer. It's saying that the US doesn't really spend very much on foreign aid and so it can afford to do so. The only interesting thing I can find is that PK ignores the possibility that the ad mentioned in the first paragraph might have been financed by ultra-Zionist types opposed to the possibility that Prime Minister Barak might make concessions at Camp David. Frankly, PK's columns in SLATE and FORTUNE were much more interesting than those in the NY TIMES. But I can't think of any professional economist who could write a consistently interesting twice-weekly column. Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~jdevine
Re: Snap Quiz
Rob Schaap wrote, If you're in the US, it's 'markets', obviously. All the government is doing is keeping the dead hand of (some other) government out of otherwise undistorted free markets. If you're in Europe, it's 'planning', as the dead hand of (some other) government is distorting free markets . . . How'd I do, Sandwichman? Obviously, Rob, you've scored 100% plus extra credit. Don't, however, mistake your dialectical cleverness in this classroom for something you can use in the real world to win friends and influence people. Temps Walker Sandwichman and Deconsultant
info
Apropos information, this is from the press release for the July issue of the Economic Journal: DON'T REGULATE THE CURRENCY MARKETS: THEIR VOLATILITY REFLECTS THE PACE OF ARRIVAL OF NEW INFORMATION Should the foreign exchange (FX) markets be regulated because of 'excessive volatility' and massive trading volume unrelated to the underlying trade in goods and other financial assets? Is FX trading 'self-generating' so that government-imposed restrictions or taxes would help ensure that exchange rates are more closely related to the 'fundamentals' that are supposed to determine exchange rates? New research by Michael Melvin and Xixi Yin, published in the latest issue of the Economic Journal, provides evidence on this important public policy issue by examining the link between the arrival of new public information, the frequency of quoting FX prices and the volatility of exchange rates. It indicates that both the number of price revisions (quotes) and the volatility of exchange rate returns for the yen and mark are functions of the rate of public information or news hitting the market. In other words, FX trading is providing the function it is meant to: adjusting prices and quantities in response to new information in order to achieve an efficient allocation of resources. Evidently some people see signal where others see noise. Doug
BLS Daily Report
BLS DAILY REPORT, FRIDAY, JULY 21, 2000: TODAY'S RELEASE: "Regional and State Employment and Unemployment: June 2000" indicates that regional and state unemployment rates were stable in June. All four regions registered virtually no change over the month, and 45 states recorded shifts of 0.3 percentage point or less. The national jobless rate, 4.0 percent, was little changed from May. Nonfarm employment increased in 21 states and the District of Columbia in June. The inflation-adjusted weekly median earnings of most U.S. workers edged up 0.9 percent over the year ended in the second quarter of 2000, BLS reports. In current dollars, or without adjustment for inflation, the weekly pay of the nation's full-time wage and salary employees rose 4.2 percent between the second quarters of 1999 and 2000. The CPI-U increased 3.3 percent over the same period, making the real pay gain 0.9 percent (Daily Labor Report, page D-7). New claims filed with state agencies for unemployment insurance benefits fell by 9,000 to a total of 311,000, after seasonal adjustment, the Labor Department's Employment and Training Administration reports. New UI claims reached 320,000 in the previous week, according to revised data. Federal Reserve Chairman Alan Greenspan said yesterday there is substantial evidence that U.S. economic growth has slowed to a more sustainable, potentially non-inflationary pace, suggesting to many Fed watchers that the central bank's policymakers aren't likely to raise interest rates next month. Greenspan, testifying before the Senate Banking Committee, stressed that evidence of slower growth isn't conclusive. But he spent far more time explaining why slower growth should be expected than he did cautioning that a rebound could occur. The Fed chairman cited higher interest rates, flattening stock prices, rising household debt burdens; a big buildup in consumers' stock of cars, other durable goods and new homes; and the large increase in oil prices as reasons a slowdown in growth makes sense. Greeenspan also noted, however, that inflation has picked up this year, largely but not entirely because of the jump in oil and other energy prices, with the increase in the consumer price index over the past 12 months now reaching 3.7 percent (John M. Berry, writing in The Washington Post, page E1). __Alan Greenspan, the Federal Reserve Chairman, said today that there was not yet enough evidence to conclude that the economy had slowed to a noninflationary pace, and he left the door open to further interest rate increases as soon as next month.(Richard W. Stevenson, in The New York Times, page C1). __Federal Reserve Chairman Alan Greenspan assiduously kept his options open for monetary policy over the next few months, saying he wasn't ready to declare a formal end to the central bank's yearlong campaign of raising interest rates. "It s much too soon to conclude" that "concerns" about inflationary pressures "are behind us," Greenspan said in his semiannual report to Congress (Jacob M. Schlesinger in The Wall Street Journal, page A2). __Greenspan sees no end in sight for the productivity bonanza, says Business Week (July 24, page 30). Technology spending is bringing on long-lasting structural gains. Accompanying graphics show that U.S. growth is slowing and consumer prices are filling, but tech spending should keep productivity up.. Recent reports of sluggish hiring gains, flat vehicle sales, and weak consumer spending all suggest that the long-awaited economic slowdown is taking shape. If you need more evidence, cast an eye at the nation's bellwether small-business sector, says Business Week (July 24, page 26). Based on the National Federation of Independent Business' monthly survey of its members, the organization's index of small business optimism fell to 97.9 in June -- its lowest level since the fall of 1993. Uncertainty about the economic outlook is evidently inspiring many small enterprises to temper their hiring and spending plans, reports an NFIB economist. Looking ahead, only 8 percent of those surveyed in June expect the economy to strengthen over the next 6 months, compared with the 25 percent who expect it to weaken. Corporate America's downsizing inclinations are waning, Challenger, Gray Christmas, Inc., which keeps tabs on layoff plans, reports that the job cut total in June fell to a mere 17,241, the lowest number in 3 years and the tenth consecutive month with a reading below its year-earlier level. "Despite reports of a slowing economy, companies still face severe labor shortages," notes a spokesman. An exception is the dot-com sector, whose 2,967 layoffs in June were the most among industries announcing cuts (Business Week, July 24, page 26), Greenspan sees no end in sight to the productivity bonanza, says Business Week (July 24, page 30). Technology spending is bringing on long-lasting structural gains
Decline of Russian Science
This is from Johnson's Russia List. No one seems to have made much mention of the positive achievements in science under planning. Indeed increased emphasis in the West on science and funding for basic research during the Cold War owed a lot to fear of the former USSR. Market economies are particularly bad for funding basic research since this does not pay off in immediately profitable applications. Cheers, Ken Hanly The Guardian (UK) 24 July 2000 [for personal use only] Town where a Soviet dream turned sour Its scientists were the envy of the world. Now some of the top brains are manual workers. Our three-part series on the decline and rebirth of Russian science begins in Siberia Amelia Gentleman in Akademgorodok Beneath the streets of Akademgorodok a maze of tunnels links key buildings so that academics in Russia's science town never need emerge into the harsh Siberian temperatures outside. In winter, workers at the institute of nuclear physics make their way along curving dimly lit walkways. The rationale of the underground system, one scientist explained, was to prevent research time being wasted in the rigmarole of wrapping up against the cold. When Akademgorodok was created from nothing in 1957, its founders spent considerable time assessing how to make life easier for the thousands of scientists who were to abandon their comfortable lives in Moscow to labour for the good of Russian science in bleak Siberia. On a site 30 miles south of the polluted industrial city of Novosibirsk, trees were planted, flats were built and spacious, well-equipped laboratories were set up. Academics were given a concert hall and a club - the House of Scientists - where they were to spend sober evenings together discussing research developments. Hundreds of tonnes of sand were imported at great expense and scattered on the stony shores of the nearby Ob sea to create the illusion of a beach on which the scientists could relax at weekends. For the first 30 years the town - with its 37 institutes and thousands of researchers working together to push back the boundaries of knowledge - was a symbol of the grandiose intellectual ambition of the Soviet regime. Scientists were treated with deference in the USSR. Lenin began to promote their interests immediately after the revolution, aware of their importance in the creation of a powerful new society. In the lean years they received extra rations. Later, under Stalin, a sense of national insecurity boosted the state's devotion to science. Most scientists escaped the repressions because they were needed to develop the country's ability to make weapons. Even those who were imprisoned continued to work in specially developed research camps. "We were slaves to the totalitarian state, but we didn't mind because we were doing interesting work and we felt that the state needed and respected us," said Vitaly Ginzburg, a physics professor, who worked during the 1940s to develop the Soviet atom bomb. Science was not a mere adjunct of Soviet life - it was at its core, the key to transforming Russia from a backward agricultural country into an industrialised mighty world power, equipped to defend itself against the capitalist enemy. The government poured large measures of the budget into cultivating this scientific base, squeezing ideological pride from internationally acclaimed - and feared - advances: pioneering aeroplanes, and later rocket technology; the first man in space; the first atomic power station; the hydrogen superbomb. For most of the 20th century the Soviet Union raced on, matching the achievements of America. Akademgorodok - meaning small town of academics - was part of that tradition. Sophisticated space technology was developed in one institute, while down the road mathematicians pioneered computer technology and biologists wrestled to make Russia's crops sturdier, using new genetic engineering techniques. But in the past 10 years it has come to symbolise the disastrous decline of Russia's academic tradition. It is generally accepted that there are two reasons why Russians move to Siberia - either they are romantics or they come as prisoners. The scientists who founded Akademgorodok in 1957 were romantics. Many who remain see themselves as the prisoners of their own shattered project. No one has forgotten the early optimism. Towards the end of the 50s it had become obvious that Siberia had massive natural resources: petroleum, gas, coal, timber, diamonds and minerals. But with the country's brainpower concentrated in Moscow and Leningrad - now St Petersburg - there was nobody to exploit its potential, so President Nikita Khrushchev backed a scheme to move leading scientists and research students from western Russia to the Siberian wilderness. Just 12 years after the ravages of the second world war, the
Re: Re: Finishing the debate
Justin, I seem to have trashed the "long" version of my second long missive on transitional non-market socialism. Sorry about that... Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~jdevine
Re: KRUGMAN WATCH: foreign take-overs foreign aid
Jim Devine is wrong!!! Yogi Berra is a wonderful philosopher. How about his: ""You can observe a lot just by watchin'." or "Baseball is 90% mental, the other half is physical" I do think that the phrase "déjà vu all over again" should be retired post haste. -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail [EMAIL PROTECTED]
Re: KRUGMAN WATCH: PK vs. RN
In my anti-column, I wrote: July 23, 2000 / New York TIMES RECKONINGS / By PAUL KRUGMAN In this column, PK turns to consider Ralph Nader, whose presidential candidacy he's been ignoring all along. (For example, when discussing Social Security, only Bush and Gore's opinions are deemed relevant.) I don't quite understand why PK's expertise in economics is needed to do hatchet-jobs on someone's personality, but PK's employers seem to think it's helpful. Paul Krugman informs me that this sounds conspiratorial, as if he takes orders from the editorial board of the NY TIMES. I apologize, especially since I hate conspiracy theory (it's a mind-killer). PK does not take orders from the editors. Rather, it's a mutually-beneficial deal between him and the TIMES. They like his political perspective and he likes theirs. Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~jdevine
RE: Re: KRUGMAN WATCH: PK vs. RN
You're sending these to PK? Do you send the rest of the thread too? mbs -Original Message- From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED]]On Behalf Of Jim Devine Sent: Monday, July 24, 2000 5:18 PM To: [EMAIL PROTECTED]; [EMAIL PROTECTED] Subject: [PEN-L:22167] Re: KRUGMAN WATCH: PK vs. RN In my anti-column, I wrote: July 23, 2000 / New York TIMES RECKONINGS / By PAUL KRUGMAN In this column, PK turns to consider Ralph Nader, whose presidential candidacy he's been ignoring all along. (For example, when discussing Social Security, only Bush and Gore's opinions are deemed relevant.) I don't quite understand why PK's expertise in economics is needed to do hatchet-jobs on someone's personality, but PK's employers seem to think it's helpful. Paul Krugman informs me that this sounds conspiratorial, as if he takes orders from the editorial board of the NY TIMES. I apologize, especially since I hate conspiracy theory (it's a mind-killer). PK does not take orders from the editors. Rather, it's a mutually-beneficial deal between him and the TIMES. They like his political perspective and he likes theirs. Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~jdevine
Re: RE: Re: KRUGMAN WATCH: PK vs. RN
I send my anti-columns to him somewhat randomly: since he's not in my address book at home, he doesn't get any of them written at home. I also forget sometimes. Is that what you're asking about? At 05:31 PM 7/24/00 -0400, you wrote: You're sending these to PK? Do you send the rest of the thread too? mbs -Original Message- From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED]]On Behalf Of Jim Devine Sent: Monday, July 24, 2000 5:18 PM To: [EMAIL PROTECTED]; [EMAIL PROTECTED] Subject: [PEN-L:22167] Re: KRUGMAN WATCH: PK vs. RN In my anti-column, I wrote: July 23, 2000 / New York TIMES RECKONINGS / By PAUL KRUGMAN In this column, PK turns to consider Ralph Nader, whose presidential candidacy he's been ignoring all along. (For example, when discussing Social Security, only Bush and Gore's opinions are deemed relevant.) I don't quite understand why PK's expertise in economics is needed to do hatchet-jobs on someone's personality, but PK's employers seem to think it's helpful. Paul Krugman informs me that this sounds conspiratorial, as if he takes orders from the editorial board of the NY TIMES. I apologize, especially since I hate conspiracy theory (it's a mind-killer). PK does not take orders from the editors. Rather, it's a mutually-beneficial deal between him and the TIMES. They like his political perspective and he likes theirs. Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~jdevine Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~jdevine
Re: Re: KRUGMAN WATCH: foreign take-overs foreign aid
Michael Perelman wrote: Jim Devine is wrong!!! Yogi Berra is a wonderful philosopher. How about his: ""You can observe a lot just by watchin'." Yes, but that hasn't been copied so many times as deja etc. I agree with Jim on that. And the observation comment isn't necessarily redundant. It is possible to watch without observing, so Berra could be considered to have made a positive (i.e., debatable) assertion. Carrol
Re: Re: Re: KRUGMAN WATCH: foreign take-overs foreign aid
Carrol Cox wrote: Yes, but that hasn't been copied so many times as deja etc. I agree with Jim on that. And the observation comment isn't necessarily redundant. It is possible to watch without observing, so Berra could be considered to have made a positive (i.e., debatable) assertion. Hmmm, well how do you feel about Sam Goldwyn's "Nobody goes there anymore. It's too crowded."? Doug
Re: Re: Re: KRUGMAN WATCH: foreign take-overs foreign aid
I am a professional economist who just finished going through the latest American Economic Review. It was actually more interesting than most, but I would put Prof. Berra (not to be confused with Barro) up there with the most prominent of them. What about "If you can't imitate him, don't copy him." Michael Perelman wrote: Jim Devine is wrong!!! Yogi Berra is a wonderful philosopher. How about his: ""You can observe a lot just by watchin'." Yes, but that hasn't been copied so many times as deja etc. I agree with Jim on that. And the observation comment isn't necessarily redundant. It is possible to watch without observing, so Berra could be considered to have made a positive (i.e., debatable) assertion. Carrol -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail [EMAIL PROTECTED]
Re: Re: Re: Re: KRUGMAN WATCH: foreign take-overs foreign aid
At 06:34 PM 7/24/00 -0400, you wrote: Carrol Cox wrote: Yes, but that hasn't been copied so many times as deja etc. I agree with Jim on that. And the observation comment isn't necessarily redundant. It is possible to watch without observing, so Berra could be considered to have made a positive (i.e., debatable) assertion. Hmmm, well how do you feel about Sam Goldwyn's "Nobody goes there anymore. It's too crowded."? I read somewhere that a lot of the sayings attributed to Goldwyn (and to Berra and to Quayle) are apocryphal. Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~jdevine
Re: Re: Re: Re: Re: KRUGMAN WATCH: foreign
Damn, Jim, next you be trying to convince people that George Washington did not cut down the cherry tree. I read somewhere that a lot of the sayings attributed to Goldwyn (and to Berra and to Quayle) are apocryphal. Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~jdevine -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail [EMAIL PROTECTED]
Re: Re: Re: Re: Re: summary of calculation debate
En relación a [PEN-L:22154] Re: Re: Re: Re: summary of calculat, el 24 Jul 00, a las 8:24, Jim Devine dijo: At 08:20 AM 7/24/00 -0300, you wrote: It would be a very instructive exercise to imagine the economy of, say, the USA, operating for eighty years in the hostile environment that the USSR had to operate in it's interesting to note that in the periods during the 20th century when the US felt only mildly encircled by hostile powers (i.e., World Wars I and II), the US economy was converted to a planned one. Planned capitalism did pretty well in terms of helping the US win WW II. Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~jdevine And under so soft situations! Please remember that the USA sponsored an irregular army in Ukraine even _after_ WWII came to an end. What would have the situation been if some foreign, hostile, nuclear power had secretly supported an irregular army operating, say, between Denver and Topeka? Because THIS, and not less than this, is the true measure of the situation in the USSR. I know this is an English only list, but cannot but remember the saying in old Argentina's "carreras cuadreras": "Emparejá y largamos!". That is, "want to confront with me at a horserace? OK, let us use similar horses, and we shall see who is worst rider!" Isn't it a point of fairness? Néstor Miguel Gorojovsky [EMAIL PROTECTED] NUEVA DIRECCIÓN ELECTRÓNICA DESDE EL 10 DE JULIO DE 2000 NEW E-ADDRESS AS OF JULY 10, 2000 [EMAIL PROTECTED]
Re: Re: Re: Re: KRUGMAN WATCH: foreign take-overs foreign aid
Doug Henwood wrote: Hmmm, well how do you feel about Sam Goldwyn's "Nobody goes there anymore. It's too crowded."? Not half so suggestive and obscure as Yogi's "observe by watching" but just straightforward and literal: "No one" in my elite crowd "goes there anymore. It's too crowded." with hoi polloi. Yours WDK - [EMAIL PROTECTED]
Global Warming and West Nile Virus
New York Times, July 24, 2000 Giuliani Says Aerial Spraying Will Be Added to the War Against the West Nile Virus By ERIC LIPTON New York City's war on the West Nile virus is intensifying, with Mayor Rudolph W. Giuliani announcing yesterday that the city planned to add helicopters to its arsenal of mosquito-killing tools and would expand its ground-based pesticide campaign to include parts of Brooklyn as well as Staten Island and Queens. The escalating effort in New York City echoes steps being taken by local and state governments throughout the New York area. The virus, which killed 7 people and seriously sickened 55 others last year, has not been detected in people this year. But at least 40 infected birds and 3 pools of infected mosquitoes have been found in New York City and 8 neighboring counties in New York, New Jersey and Connecticut, the authorities said. At the end of last month, the virus had been confirmed in only a few birds in Bergen County, N.J., and Rockland County, N.Y. Full article at: http://www.nytimes.com/yr/mo/day/news/national/regional/ny-bug.html = From "Is Global Warming Harmful to Health?" by Paul Epstein, in the current Scientific American (www.sciam.com): The increased climate variability accompanying warming will probably be more important than the rising heat itself in fueling unwelcome outbreaks of certain vector-borne illnesses. For instance, warm winters followed by hot, dry summers (a pattern that could become all too familiar as the atmosphere heats up) favor the transmission of St. Louis encephalitis and other infections that cycle among birds, urban mosquitoes and humans. This sequence seems to have abetted the surprise emergence of the West Nile virus in New York City last year. No one knows how this virus found its way into the U.S. But one reasonable explanation for its persistence and amplification here centers on the weather's effects on Culex pipiens mosquitoes, which accounted for the bulk of the transmission. These urban dwellers typically lay their eggs in damp basements, gutters, sewers and polluted pools of water. The interaction between the weather, the mosquitoes and the virus probably went something like this: The mild winter of 1998-99 enabled many of the mosquitoes to survive into the spring, which arrived early. Drought in spring and summer concentrated nourishing organic matter in their breeding areas and simultaneously killed off mosquito predators, such as lacewings and ladybugs, that would otherwise have helped limit mosquito populations. Drought would also have led birds to congregate more, as they shared fewer and smaller watering holes, many of which were frequented, naturally, by mosquitoes. Once mosquitoes acquired the virus, the heat wave that accompanied the drought would speed up viral maturation inside the insects. Consequently, as infected mosquitoes sought blood meals, they could spread the virus to birds at a rapid clip. As bird after bird became infected, so did more mosquitoes, which ultimately fanned out to infect human beings. Torrential rains toward the end of August provided new puddles for the breeding of C. pipiens and other mosquitoes, unleashing an added crop of potential virus carriers. (Paul Epstein, an M.D. trained in tropical public health, is associate director of the Center for Health and the Global Environment at Harvard Medical School. He has served in medical, teaching and research capacities in Africa, Asia and Latin America and has worked with the Intergovernmental Panel on Climate Change, the National Oceanic and Atmospheric Administration, and the National Aeronautics and Space Administration to assess the health effects of climate change and to develop health applications for climate forecasting and remote-sensing technologies.) Louis Proyect The Marxism mailing-list: http://www.marxmail.org
needed fast!
Friends, I received a request for information about privatization and its attendant evils. This information will be used by a person who is writing a report for the government of Vietnam. Please send to me asap references and articles on this subject, and I will forward them. Who knows, we may be able to influence the government's policies! Send articles either pasted into the email or as rtf or wordperfect attachments. References and articles about privatization in any country will be useful. Thanks. Michael Yates
Re: kargarlitsky on Russian sociology etc.
I have been working in residential opinion polls in Argentina, a country with some points in common with the fSU on these issues. Yes, I DID it, it was an "eat or starve" issue, and I won't tell you I am not ashamed, but at least I can share with you some expertise I gained. I discovered, for instance, that the universe of these surveys is basically "middle class" (in the Argentinian sense of a mostly wage earning petty bourgeoisie with some little sprinklings of individual entrepreneurs), due to concrete field difficulties. Since security conditions have been evolving in a directly inverse proportion to the growth of our foreign debt, residents in appartment houses (which compose the bulk of residents in Buenos Aires City) are very hard to interview, and the same uses to run for people residing in closed quarters or country clubs. So, they are usually dropped. Residents in unsafe areas are also hard to interview, due to opposite reasons: prejudiced, lower middle class, surveyors, do not go to the "villas de emergencia" where these people live. So what? You are left with those people residing in one-storey houses, a universe which has a basically "center of the Gauss curve" profile. So that, when, say, American detergent manufacturers want to have an idea of whether Argentinian households will prefer THEIR brand over that of the competitor, what they will obtain is the image of what will those middle class homes do. They will not have an idea of what will the whole of the society do. Now, this is not quite serious in so far as to these issues middle class households living in apartments and in one-storey houses tend to share their pattern of preferences, the lower classes have been ruled out of consumption after 1976, and the upper layer is not a massive market and is to be attacked by means of another kind of artillery. But, what about political opinion? Well, in political opinion polls you will have the "middle of Gauss curve" image again. And, due to scarce resources, you will hardly have a seriously conducted survey. People will be interviewed at some important downtown spots, plus a few spots at commercial centers outside. Or, people will be interviewed by phone (thus setting a limit to the kind of answers you get, since telephone is not a massive thing in Argentina today). And the opinion of Inland Argentina will be seldom surveyed (perhaps some survey can be conducted in, say, Córdoba and Rosario, and if you are lucky enough Mendoza and Tucumán). But that is all. However, these polls DO have some meaning. They express the most conservative side of the abstract, current, state of consciousness of the masses. While our enemies would like to state them as the expression of the state of mind of "the nation", we can put the adequate distorting lenses and see a better image. Of course, one must know the country and its history in order to do so. But I do not think that these polls are so useless. Take, for instance, the data we have just read on the USSR. What they portray is the expectative of the center of the Gauss curve in the sense that they need a strong central power which puts order in the chaos. That is why the attempt at orderly westernization by Tsardom and the Khruschevite attempt at peaceful coexistence and emulation display such a large acceptancy ratings. And this is not only a matter of comparison with previous states of mind. We should not forget that, historically, emulation with the West emptied Soviet ideology of that basic component of Lenin's (and Stalin's to a certain extent) view: that the USSR was on an equal foot with imperialist countries. The events after 1989 have shown that for them, as for almost anybody in the Third World, the alternative was "socialism or colonization". The survey shows that this is still not clear in the mind of the Muscovite middle classes (I bet the surveys were made there, perhaps in Petrograd -will NOT say St. Petersburg unless under torture-, and hardly elsewhere). Well, just wait and see. Néstor Miguel Gorojovsky [EMAIL PROTECTED] NUEVA DIRECCIÓN ELECTRÓNICA DESDE EL 10 DE JULIO DE 2000 NEW E-ADDRESS AS OF JULY 10, 2000 [EMAIL PROTECTED]
