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I thought this paragraph was particularly insightful: And yet, with the benefit of hindsight, we can see that the crucial question regarding whether or not to
by nkurz 10y ago
I thought this paragraph was particularly insightful:
And yet, with the benefit of hindsight, we can see that the crucial question regarding whether or not to use fiscal stimulus was a completely different one—which is more corrosive to the legitimacy of the institutions which make the prosperity of a liberal, global economy possible: a long economic slump, or a short-term stimulus so large that it inevitably leads to spending on low-return projects or lines the pockets of government-friendly firms? We were all tying ourselves in knots working out whether the multiplier on infrastructure spending was 0.7 or 1.2 or 2.5, when what we ought to have been asking was: what course of action is most likely to avert a crisis of institutional legitimacy that will leave everyone much worse off.
- deleted 10y ago[deleted]
- jsprogrammer 10y agoReactionaries are trying to keep a grip on their beloved institutions. Institutions failed, as they are wont. If any course of action can lead to a crises of 'legitimacy', it was already time to break out.
- sliverstorm 10y agoTo be clear, are you talking about institutions as the article defines them? Institutions are organisations or patterns of behaviour built by societies to help solve social or economic problems which the law or private markets cannot fully address. If I'm on the right track, an example of institutional legitimacy might be, "Banks can be trusted to hold your money" (vs stuffing it under your mattress), and FDIC insurance might be an example of an action to support or create that legitimacy. Banks, at least as depositories for money, seem worth having...
- jsprogrammer 10y agoThe article says "it just isn't done" is an institution. A good example would be, "MSNBC utterly failed to fact check 2016".
- pjc50 10y agoThe article says "it just isn't done" is a principle. Or a maxim. Institution in this context refers to organizations.
- jsprogrammer 10y agoThe article (on economist.com) claims that [e]conomists "would call" it an institution.
- anigbrowl 10y agoYour post exemplifies our problems: instead of addressing what you see as wrong with said institutions (many of which actually work rather well) you literally launch an ad hominem attack from your very first word, characterizing your opponents without bothering to build an argument. Incoherent and inchoate nonsense like that which you've posted here just adds to the existing political noise and is itself an obstacle to any progress (which I define as a sustained increase in the median household's real income for short).
- jsprogrammer 10y ago"Your" vs "reactionaries" and I'm the one engaging in ad hominem? Hilarious. I addressed exactly what is wrong.
- CountSessine 10y ago"Your" vs "reactionaries" and I'm the one engaging in ad hominem? https://en.wikipedia.org/wiki/Ad_hominem https://en.wikipedia.org/wiki/Ad_hominem
- felipeerias 10y agoThere is a definition of neoliberalism that has stuck with me: "neoliberalism is optimising for the wrong thing because it is the only one that we know how to measure". I.e. we built a system that maximises shareholder returns because those are easy to account for, damaging far more important social institutions along the way.
- devoply 10y agoIMO the economic system is actually a reinvention of nature. However, our rendition of nature does not actually follow nature, but is a monster created by systems that totally don't mirror nature -- i.e. hierarchical systems. If we want an actual functional economy we should model nature as closely as possible because we know it actually works. And it works without any management. Our system is a bastard child of natural economics and hierarchical structure. It's for this reason it needs constant management, usually to benefit those at top of the hierarchy who constantly break it and pass the bill to the people at the bottom.
- sooheon 10y agoBy what measure does nature "work"? The only thing nature optimizes for is survival until reproduction. This is just as arbitrary as shareholder return. Besides, the entirety of the economic system is part of the natural activity of the natural animals homo sapiens, driven by natural desires priorities. It is not a reinvention of nature as much as it is a subprocess.
- devoply 10y agoThat's not what it is. It's not a subprocess. Nature is exactly what the economy is, limited resources and optimizations to utilize those resources. Each company in our system is an animal. That uses finite resources to continue to survive, as a by-product think of shit, it produces goods that we desire. It also has smaller entities like humans and other companies that feed off the energy that it acquires and consumes, like employees. These companies fight for survival in the market place where they gather more energy by producing things. Energy in our system is money, it's the most basic form that can be consumed by all entities. In real nature, you can't consume energy directly you have to go through other organisms, acquire them, to get energy. Anyway, this is not some sort of thesis, it's just an observation, that I want to throw out and maybe someone will read it and be inspired to formulate a thesis. Another observation, the reason people are so miserable in the economy is the same reason people are miserable in nature. Civilization was a means to escape nature, but we have recreated nature in a completely different domain on top of abstractions. The economy, Capitalism, is nature that's recreated. That's also why people want Socialism and Communism, to escape from this new brutal "nature" again.