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Back To The Future
Submitted by Tim Price via Sovereign Man blog,
“Sir, Arnaud Montebourg, the former French economy minister and the sourest note in the Hollande repertoire, dares to complain of “absurd” austerity policies ? (“Hollande purges cabinet following leftwing revolt”, August 26.) If those policies are absurd, it is because they were not accompanied by the structural reforms so badly needed to make the French economy healthy. I am speaking of long outdated redundancy and seniority labour laws, oppressive regulations for the business sector and the unbearable bureaucratic roadblocks that stand in the way of start-ups.
“To these, one can also add the traditional Gallic mindset of envy, if not outright hostility, towards those French citizens and other Europeans who are willing to work longer, harder and smarter and want to make good money; a mindset that Mr Montebourg never hesitated to parade before the world. Now that he and his cohorts on the left of the Socialist party have departed the government, perhaps François Hollande can move forward and leapfrog France from the 19th to the 21st century.”
- Letter to the FT from Stan Trybulski, Branford, Connecticut, 28th August 2014.
“There’s a great deal of ruin in a nation.”
- Adam Smith.
“You will never understand bureaucracies until you understand that for bureaucrats, procedure is everything and outcomes are nothing.”
- Thomas Sowell.
Much of what we think we know isn’t necessarily so. The invention of the printing press with movable type? Traditionally credited to fifteenth-century Germany and Johannes Gutenberg, it was actually invented in eleventh-century China. Paper also originated in China long before it was used in the West. As did paper money and toilet paper (albeit today, these are pretty much interchangeable). English agriculturalist Jethro Tull is widely credited with the discovery of the seed drill in 1701. It was in fact invented by the Chinese 2,000 years beforehand. The first blast furnace for iron smelting is associated with Coalbrookdale – tragically close to schools in the West Midlands. It was actually introduced by the Chinese before 200 BC. The Chinese were also first to use the fishing reel, matches, the magnetic compass, playing cards, the toothbrush and the wheelbarrow. Perhaps even golf. So how did a society apparently so dynamic and innovative by comparison with the West then enter a centuries’ long decline?
Niall Ferguson, in his excellent book ‘Civilization’ (Penguin, 2012) puts forward six “identifiably novel complexes of institutions and associated ideas and behaviours” that account for the cultural and economic outperformance of the West between, say, the 16th and 20th centuries:
- Competition
- Science
- Property rights
- Medicine
- The consumer society
- The work ethic
He defines these trends as follows:
- Competition: “a decentralization of both political and economic life, which created the launch-pad for both nation-states and capitalism”.
- Science: “a way of studying, understanding and ultimately changing the natural world, which gave the West (among other things) a major military advantage over the Rest”.
- Property rights: “the rule of law as a means of protecting private owners and peacefully resolving disputes between them, which formed the basis for the most stable form of representative government”.
- Medicine: “a branch of science that allowed a major improvement in health and life expectancy, beginning in Western societies, but also in their colonies”.
- The consumer society: “a mode of material living in which the production and purchase of clothing and other consumer goods play a central economic role, and without which the Industrial Revolution would have been unsustainable”.
- The work ethic: “a moral framework and mode of activity derivable from (among other sources) Protestant Christianity, which provides the glue for the dynamic and potentially unstable society created by “killer apps” 1 to 5”.
For our purposes we are most interested in Ferguson’s first “killer app”, Competition. But we will also refer to it in a slightly different context – “the lack of bureaucracy”. As the chart below shows, from 1000 AD to its high water mark in the 1960s, UK GDP relative to China’s was a one-way bet. Since then, however, the trend has gone into reverse.
Source: Niall Ferguson / Penguin Books
What can account for this dramatic reversal of economic fortunes? Economic reforms in China, led by Deng Xiaoping in the late 1970s, are likely to be responsible for at least part of the turnaround. But the relentless and sclerotic expansion of the State in Britain has also played a role.
UK general government expenditure (green) and private expenditure (black) as a proportion of GDP
Source: David B. Smith / Steve Baker MP
As the chart above shows, at the turn of the last century, UK state spending accounted for roughly 10% of the economy and the private sector accounted for the rest. But as the welfare state has swelled, government spending has mushroomed to account, now, for something like half or more of the entire economy. And state spending, by and large, is inefficient spending – at least by comparison with the inevitably more disciplined for-profit sector. In other words, our relative economic prospects have declined in inverse proportion to the expansion (metastasis) of the State. In turn, bureaucratic parasitism likely accounts for productivity differentials in the eurozone; the German State accounts for roughly 45% of its economy, the French State 56%.
Politicians have been able to swell the State thus far only with assistance by two groups: with the involuntary support of taxpayers, and with the connivance of central bankers. Popular resentment of what is laughably termed ‘austerity’ threatens the ongoing indulgence of the first group; the almost terminal straining of market forces by the latter runs the risk of a disorderly collapse of confidence in bond markets, after which continued Western deficit spending would be virtually impossible.
We seem to be close to the endgame. Even as perversely, record-low bond yields (indiscriminately – across markets as diverse as Austria, Belgium, Germany, Holland, Finland, Ireland, Italy and Spain) have sent desperate investors scurrying into stocks instead, those same investors are, with extra perversity, displaying a similar lack of discrimination and not even attempting to locate relative value within markets. Extraordinarily, the Wall Street Journal points out that
“Investors are pouring money into Vanguard Group, the epitome of the hands-off approach to investing, flocking to funds that track market indexes and aren’t run by stock pickers or star managers. The inflow has pushed the mutual-fund giant to almost $3 trillion in assets under management for the first time. The surge is part of a sea change in the fund business in which investors are increasingly opting for products that track the market rather than relying on managers to pick winners… Investors poured a net $336 billion into passively managed stock and bond funds in 2013, handily beating the $53 billion invested in traditional mutual funds of the same type, according to Morningstar. So far this year through July, investors put a net $177 billion into those passive funds, compared with $74 billion in actively managed funds… Through July, passively managed stock funds have seen a net $128.4 billion in investor in flows, compared with $18 billion for traditional stock funds…”
Nor is this lack of judicious investment a product of bullish US market sentiment. The same arbitrary index-following – at all-time highs – is being pursued in the UK. Trade magazine FTAdviser reports that
“Retail investors put more money into tracker funds in July than in any other month since records began, according to the latest IMA data.”
Index-tracking may have merit at the bottom of the market, but at the top?
Having singularly failed to reform or restructure their dilapidated economies, many governments throughout the West have left it to their central banks to keep a now exhausted credit bubble to inflate further. Unprecedented monetary stimulus and the suppression of interest rates have now boxed both central bankers and many investors into a corner. Bond markets now have no value but could yet get even more delusional in terms of price and yield. Stock markets are looking increasingly irrational relative to the health of their underlying economies. The euro zone looks set to re-enter recession and now expects the ECB to unveil outright quantitative easing. If the West wishes to regain its economic vigour versus Asia, it would do well to remember what made it so culturally and economically exceptional in the first place.
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Indeed we are close to the end game.
Off topic here. NOBODY cares about any of all the shit going on right now because there is a Massive and I mean MASSIVE leak of nude celeb photos to sift over which could take years!
Basically this leak is to distract and halt any progress of seeking the truth by the sheeple and back to the morbid pathetic lives digging for these pics to satisfy their sexual fantasies. I guess having the sheeps awaken for a few days is better than none at all.
I am sure Jennifer Lawrence, Kate Upton is trending miles ahead of Ebola virus, Ferguson killing, Russia-Ukraine, Pakistan riots, ISIS, Israel bombing of Gaza, MH17/MH370, China Japan tensions.
Where are these pictures?
End game? Without even crowning a king??
Obama crowned himself.
All selfies are belong to us.
Masturbation is the topic here. Would anyone like to confirm that Joan Rivers was being sexually molested during her endoscopic procedure and because of this atopic stimulation she awoke and the doctor ended up killing her because he felt guilty that he made her orgasm.
Who's got the scoop on this?!
They keep getting deleted due to legal issues, but the fappening on reddit is a pretty good way to track them down.
Most are nudes, and some (Kate Upton, for example) go way, way past that.
Be warned that the McKayla Maroney and Liz Lee's leaked pics were taken when they were under 18 and are legally considered child porn.
Nude chicks on the internet are zero cents a dozen, the real story that seems to be getting missed is just how massive a leak this is, and of a supposedly secure and encrypted storage service.
They keep getting deleted because no one is interested in seeing a full on beaver shot of Kate Upton. The internet has spoken and is self deleting. Try looking up celebrity ass babies. Same thing. It was the funniest scientology comedy sketch I have ever seen. Yet the internet has forgotten it for some reason.
Expect to see sexual content be moar prevalent.
The final wheeze of Sodom and Gomorrah.
The reasons for the hack seem a bit cloudy.
Everything about this seems sketchy. Timing, sources, etc. One of the actresses that confirmed the pics were real also said that she'd deleted the particular pictures years ago.
While it's probably the case that it's a handful of guys with a sketchy hobby, at this point I wouldn't be shocked if it was some NSA provided dump for god knows what reasons.
The other interesting thing that came out today was the disclosure of dozens of fake cell phone base stations all across the US.
"Off topic here."
Like "the topic" (support the status quo by twisting more populist "logic") is anything different than "ass" pics???
Ooooohhhh, look at the "shiny object"....good thing you brought it up "Divided States"(aka Koch troll)...
Creatively titled, "The Fappening."
I only care about what Josh Earnestly says Kate Upton thinks about Jennifer Lawrence's breasts.
So, you're implying that the Icloud dump was a government psyop....
Wow... five years ago I'd have said you were insane.
Now I'd say you're more than likely right.
I don't know. I've spent the last 24 hours non stop looking for nude pics of JLaw. And nothing !! Can't find one picture of even a nipple !!! Where are these nude pics. HELP !!!
Exactly. Has anyone seen any?
Everybody is going to have to wait until the patriots at the NSA are finished analyzing them for evil-doing.
Oh yeah, the evil doers analyzing the evil doers, that will end well for sure.
Time to go long on astroglide.
xhamster.com In one pick it looks like jlaw has a mouthfull of white goo.
She must have been munching on a donut with vanilla icing sugar or some such.
Somewhere there are Polaroids of a 19-year-old Tippy boning Goldie Hawn backstage of the Laugh In set.
so this was secretly an NSA release.
Wait, you mean "investors" ARE buying stocks with their "dry powder"? So, it's not completely algos in this "market".
remember sept 11
looks like them towers
were imploded with explosives ...
time for a real investigation
Here's some funny shit.....
http://www.cnbc.com/id/101963821
As long we have beaver shots of Kate Upton to trade on the net we generate enough economic activity to keep this puppy going indefinitely.
Saw the Jennifer Lawrence pics - underwhelmed. I banged better in 6th grade.
"Niall Ferguson, in his excellent book ‘Civilization’ (Penguin, 2012) puts forward six “identifiably novel complexes of institutions and associated ideas and behaviours” that account for the cultural and economic outperformance of the West between, say, the 16th and 20th centuries:"
If you define a small enough window of time then anything can be made to appear "successful."
Ferguson ought to take off his blinders (a look at 3,000+ years, not a few hundred [during which the bulk of the world's resources were discovered]):
http://www.rexresearch.com/glubb/glubb-empire.pdf
Seer,
Ferguson can't take off his blinders, because of three reasons:
He's an economic & business history professor
He's a Thatcherite
And he's a Senior Research Fellow of Jesus College, so he has to lean right, even if he doesn’t believe it
And the excuse for Tim Price is? He called Ferguson's book "excellent."
Seems that folks at Sovereign Man blog just can't dip their paddles very deep.
I'm glad that I don't have to pimp words for a living...
Pimping words for a living is not a good place to be.
I know many people, very good people, that need to do that to have jobs.
It's very uncomfortable for them, especially when they are around me.
Last night I watched “World War-Z” and there was a scene when this Mossad agent said something like he was the tenth man, challenging all the group assumptions and all their believes.
That’s how I feel.
And they learned how to respect that. And they like my personality, too.
Wow. What a moronic statement. "During which the bulf of world's resources were discovered". The 400 years sugested by Ferguson is probably too large. Think Renaissance to 20th century, the you may want to read Ferguson again. It is the size and pace of Wstern technological, human, and Gov't developments that took place in those 400 years versus Asia that he is referring too. That is his point.
Ebola in town?
You know it is pretty much fucked up when the government is now considering death panels instead of reducing government.
C'mon France, you're not 'whacking up' enough!!
Doesn't hurt that Europe discovered two basically empty Continents and created an "Age of Discovery" (19th Century.)
Sure Western Europe got a lot of things from the East...but what it discovered and produced in the 1800's is unmatched in human history.
Welsh pumps, the screw type propeller, the periodic table, mass production, mass media. The very idea of "progress."
For good or ill remains the question of course...
Yeah all that stuff that was made ions ago by someone else. It was the inability to properly manage all the things they created which lead to their demise.
MOAR Ctrl-P!!!!
Keeping things the same is homeostasis .
Breaking homeostasis is seen by systems as "betrayal"
Notice the usual fate of innovators is isolation and neutralization.
Success leads to a peak , greed tries to keep it there .
Anybody who advises restraint gets zapped as a traitor .
See http://andreswhy.blogspot.com/2011/11/unfairness-of-betrayal.html
A good example is the Delian League . Google it .
"If the West wishes to regain its economic vigour versus Asia, it would do well to remember what made it so culturally and economically exceptional in the first place."
Hmmm... I don't recall the West ever having the so called Affirmative Action laws in place ever before in history, nor targeted immigration from countries with low eduation skills, violent societies, and violent theocracies.
Correlation not proving causality of course.....
Had my employer suspend my 401k. No sense in buying into equities at these valuations.
Pleased gold is dropping. I'll be retiring my mortgage at an accelerated rate for a guaranteed 4% return and buying phys.
BULLSHIT -- Self-serving neo-Liberal drivel
The so-called sclerotic European economies provide their population with a high degree of well-being. This is the goal of any economy. So-called structural reforms (code word for breaking down the welfare state) want to sacrifice this well-being for a poorer populatiion working for fewer wages, so that the holders of assets can grow even wealthier. Austerity/poverty as a means to wealth makes no more sense than fucking for virginity.
The sclerotic European states have smaller deficits and much smaller debts as a percentage of revenue than does the USA. Public health (a large part of "public" GDP) works far better than private health in the USA. And that is true for other institutions.
The ancient Greek city states or the city states in bronze age Mesopotamia were very competitive. Competition is not new. Nor are property rights. Roman creditors had absolute rights, for a thousand years. Do you think the proprieters of Norman England had insufficient property rights? And no society before us was ever held back by huge bureaucracies. Besides, private enterprises are also full of bureaucracy. Bureaucracy is a function of size and specialization. More co-ordination is required. It is not the size of bureaucracy but it's efficacy that is important.
What marks wealthy countries is that they have a well-developed public infrastructure, educational, and health systems. These lower the costs of doing business and keep them competitive. That is why you cannot just start a competitive business in Mozambique, despite the low wages and low taxes.
The important thing in the economy is not whether investments are private or public, but whether they are good investments or on the contrary wasteful, counter-productive or purely consumptive. There are big issues facing Western societies, but they do not yield to such simplisms about competition and smaller government. Society is not just about competition but about working together. Few things are as wasteful as everyone externalizing part of their costs (similar to conquest and pilfering). The right balance between common and purely private interests is not easily captured in models that picture things as less brakes, more gas. Is private knowledge always better than shared knowledge? That depends on circumstances. It's complicated.
YES. It's BS. What has essentially gone wrong is that free market cpaitalism (best that we have todate) has been captured by Oligrachs/Banksters.
Until you correct the imbalances with real Umpires (Govenments) that insist on a balance of Social Justice for their Societies, you are just fixing the fringes with economic theories that are just belief systems.
Asia is no "killer ap" as it is immersed in the same croynism.
Competition is a myth and you can call the bluffs of the Oligrachy You start with insistence on Cooperation from Others and if that fail, you are justified for "Self Defenses from a high moral ground.
Nation states were certainly not a result of decentralization. They marked a hitherto unheard concentration of power and resources: the height of centralization.
And all this because several years ago, TPTB did not want to admit failure and allow stupid business decisions to cause stupid businesses to go out of business.
It was actually only point 2 that mattered, while all the rest played a supporting role which allowed that to happen: Science: “a way of studying, understanding and ultimately changing the natural world, which gave the West (among other things) a major military advantage over the Rest”.
However, that has dead-ended due to the inability of social sciences in general, and especially political science, to make any genuine progress, because doing so would necessarily blow away all previously dominant religions and ideologies, or rather treat them as ore to be smelted, so that their concepts could be recycled from the perspective of the actual evolutionary ecologies that were the real basis of those previous ways of understanding the world. There could still be some genuine political "progress." However, that would have to work through the profound paradoxes that warfare was the oldest and best developed social science, whose success was based on backing up deceits with destruction, which then was the foundation to build a political economy in which success was based on enforced frauds.
The essential problem that the Western civilization faces is that its biggest bullies' bullshit social stories were able to continue to dominate the development of the potential of advancing science and technology, to channel the industrial revolution into paths based on astronomically amplified systems of legalized lies, backed by legalized violence, i.e. to build globalized systems of electronic fiat money frauds, backed up by the threat of the force of atomic bombs. Inside that REAL context, almost everything in this article above is grossly superficial, because the main thing that it does NOT do is go through a series of intellectual scientific revolutions, which are sufficient to enable political science to catch up to advances in physical sciences. The reasons for that are profound, and extremely paradoxical, which is why almost nobody is able and willing to go through those transformations in their perceptual paradigms, despite that changing paradigms does not change what exists, but only the ways that we perceive what exists, which then enables a better understanding of what EXISTS to RELATIVELY change what exists.
The basic problem is that progress in science was based upon better and better understanding of general energy systems. HOWEVER, that was NOT done to better understand the general energy systems of civilizations, because that would take profound paradigm shifts which would not be liked by either the ruling classes, nor the controlled opposition groups. Social pyramids operate with ruling classes that specialize in being dishonest and violent, while those they rule over become incompetent idiots that adapt to survive inside those systems of social slavery. In that context, the necessary changes to enable any more scientific societies make all other previous paradigm shifts, that were basic breakthroughs in physical sciences, look like child's play by comparison.
IF Western Civilization is going to survive (which seems improbable at the present time) then it will have to continue to advance science in much more radical ways, which will enable the development of a Translithic Civilization to supplant the current style of Neolithic Civilization. The core to that has to be the development of better understanding of the ways that the biggest bullies' bullshit social stories dominated the philosophy of science, the same as all other social enterprises. Around that transformation it would be able to have a radically different understanding of how to maintain the militarism that operated the murder systems, which backed up the monetary systems. The core concept to the improvement of the ways that human artificial selection operates are radically different death controls. The essence of any future social and political progress MUST be based upon understanding natural selection better, so that better understanding could be more scientifically applied to develop better systems of artificial selection. However, given how practically impossible that is from a practical political perspective, we are indeed getting "close to the endgame."
The basic problem has been significant progress in physical sciences, while nothing like that has been allowed to happen in political science. The primary reasons for that have been that the best developed social science was warfare, whose success was based upon deceits, which then became the foundation of economics, whose success was based upon frauds. IT IS IMPOSSIBLE FOR WESTERN, OR GLOBALIZED, CIVILIZATION TO SURVIVE UNLESS IT MORE SCIENTIFICALLY WORKS ITS WAY THROUGH THOSE PARADOXES THAT SOCIAL SCIENCES WERE BASED UPON BACKING UP LIES WITH VIOLENCE, BECAUSE THEIR FOUNDATION WAS THE HUMAN MURDER SYSTEMS, WHICH BACKED UP THE MONEY SYSTEMS.
The article above is typical of the grossly superficial ways that political economy is usually presented in ways that deliberately ignore the environmental ecologies. The crucial problem that human civilization faces is that, since the murder systems backs up the money system, HOW can human beings operate better murder systems, after the progress in basic physical sciences has enabled the development of weapons of mass destruction that are trillions of times more powerful, and headed towards becoming quadrillions of times more powerful? In theory, we should apply the ways of thinking that made those sciences and technologies possible in order to transform Neolithic social pyramid systems into a Translithic style of civilization. It is NOT possible for human beings to survive developing better and better understanding of general energy systems, while they deliberately ignore what that means to human energy systems. The future, IF we survive to have one, must be achieved through a series of intellectual scientific revolutions, which apply to politics in general, and to the combined money/murder systems in particular.
That paradigm shift would NOT change what already exists, but it may enable changing how that develops in the future. It was always absurd to believe that science and technology could enable industrial revolutions that made human beings become orders of magnitude more powerful and capable, while those human beings could still continue to believe in dangerously obsolete religions and ideologies. The chronic political problems, amplified orders of magnitude by the progress in science and technology, could only be better resolved by developing more scientific societies. However, anything like that would have to based on radical transformations in philosophy of science, which were able to understand how and why the biggest bullies' bullshit dominated the previous development of the philosophy of science.
IF there is going to be a future for human civilization, then we MUST enable a creative synthesis of post-modernizing science with ancient mysticism. However, at the present time, apes with atomic bombs committing collective suicide seems the far more probable future for the human species, because, as is TYPICAL with Zero Hedge articles, this one above grossly understates the degree to which "Much of what we think we know isn’t necessarily so."