Hickey on fighting the currency war

18 comments on “Hickey on fighting the currency war ”

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1. prism 1

   7 October 2010 at 11:02 am

   ” We shouldn’t leave the guidance of our economy to the invisible hand of blind, fallible, and valueless markets.” Not forgetting predatory. Is it wasps that will puncture grapes, suck out the juice and leave the depleted fruit hanging looking good from a dstance? That will be us, may be is already proceeding. Or perhaps the analogy is Nauru, mined for its riches of fertiliser and now facing stones all around and stoney-eyed financiers.
2. Draco T Bastard 2

   7 October 2010 at 11:43 am

   The tragedy of the commons isn’t the only example of market failure;

   Actually, The Tragedy of the Commons is a perfect example of the irratinality of the free-market. Add rules and that tragedy won’t happen (if they’re followed and enforced). The neo-liberal paradigm is to remove the rules which, of course, ensures that the tragedy will happen. The other point is that the psychopaths will try to avoid the rules or, if in a position of power, will write the rules in such a way so that they don’t work or benefits them in some way, i.e. Nationals’ ETS, the repealing of the Glass-Steagal Act

   …and climate change crises because of markets’ failure to react to the long-term problems they’re causing.

   “The market” will use up resources as fast as possible with no thought about tomorrow. This is partly due to its propensity to use everything available now and partly due to the profit motive where the sole purpose is to accumulate as much money as possible and the money is accumulated by using up resources.

   The neoliberal mantra has always been that the government shouldn’t pick winners.

   Of course that’s what they say – that way they can game the system. If the government actually did what was best for society then the capitalists would lose the wealth that they’ve accumulated as well as the control that they have. And we would, of course, have a viable economy that actually helps the people.

   It’s time to drop the neo-liberal paradigm. It doesn’t work, it never has worked and never will work. We also have to become self-sufficient and so does every other country in the world.
   • nzfp 2.1

     7 October 2010 at 11:47 am

     He Draco

     Add rules and that tragedy won’t happen

     Change/add the rules and you change the game – which means we can change the game to make “winning” socially, environmentally and economically beneficially to all of us (including the biosphere we live in).

     Capcha: ACHIEVED!
   • djp 2.2

     7 October 2010 at 12:19 pm

     >>The tragedy of the commons isn’t the only example of market failure;

     This is a total clanger, the tragedy of the commons can only happen when there is no market. Note the word “commons”, how can there be a market when there is no private ownership.

     It seems to me that Marty uses this (misplaced) point to argue for govt intervention and then spends the rest of the article showing the stupid govt interventions (I agree they are stupid btw) going on around the world today (mercantilism, printing money etc).

     Come on guys (as Jane Galt said):
     1) People are often stupid
     2) Bureaucrats are the same stupid people, with bad incentives.
     • Bright Red 2.2.1

       7 October 2010 at 12:23 pm

       the problem of the tragedy of the commons is that individuals making rational decisions at an individual level will cause a problem at a colelctive level that comes back to hurt them all.

       The individual cowherd has an incentive to have as many cows as possible on the unregulated field. They overstock it and the cows starve.

       That’s a problem of individuals in a market acting for themselves with no colletive authority to make sure they don’t screw up.

       Marty’s point is correct.
       • djp 2.2.1.1

         7 October 2010 at 12:36 pm

         I think you are mixed up Bright Red.

         Either the cowherd owns the property (in which case he will take care of it), or the property is designated “commons” (probably by some govt bureaucrat) and it will fall foul of the “tradgedy of the commons”.

         Compare for example the state of your home toilet with a public one.
         • Bright Red 2.2.1.1.1

           7 October 2010 at 12:40 pm

           the private property system is one way to deal with the particular situation in the tragedy of the commons. What it is important to realise is that the private property system is a form of collective governance. Private property rights exist in as much as they are recognised and enforced by a governing body.

           It is only by organising collectively (perhaps to create private property rights, perhaps by creating collective rules/laws) that the tragedy of the commons, where each looks after himself in an unregulated, free-for-all environment is avoided.
         • Colonial Viper 2.2.1.1.2

           7 October 2010 at 1:02 pm

           In fact, when it comes to things like water coming down the river, or air quality, commercial interests have no problem dumping into or exploiting the resource as much as they are able to. Circumventing or removing regs as far as possible is an example of this behaviour.

           Compare for example the state of your home toilet with a public one.

           The widespread mindset of property oriented individualism – I don’t own it so why should I be careful with it, keep my litter off the beach etc.
         • Draco T Bastard 2.2.1.1.3

           7 October 2010 at 1:48 pm

           Compare for example the state of your home toilet with a public one.

           And that wouldn’t be an example either if the people paid enough in rates to ensure that the toilets were properly maintained. It would also help if the children were taught just where the resources were coming from for that toilet and it’s maintenance that way they may just stop destroying them.
     • Draco T Bastard 2.2.2

       7 October 2010 at 1:41 pm

       The “commons” is a set area were anyone can use it within a set of rules. It’s not privatisation that stops the tragedy as argued by the economists but the rules which always accompanies it. Privatisation actually ensures the tragedy as it also removes the rules and the oversight by the community. This is seen in our farms where the rules governing the farms are close to non-existent (voluntary regulation) and there’s no real oversight anyway. The result is the massive degradation of our natural ecology, pollution of our rivers and usurpation of our water to profit the individual farmers.

       And Jane Galt was obviously an idiot to come up with such simplistic nonsense.
   • jimmy 2.3

     7 October 2010 at 12:35 pm

     It makes me laugh how some of the commenters on Hickeys page still think the govt shouldnt be picking winners when not picking winners is just the same as picking winners (i.e. not doing anything is just the same as doing something, someone wins/looses regardless).
   • Jeremy Harris 2.4

     8 October 2010 at 2:59 pm

     The neo-liberal paradigm is to remove the rules which, of course, ensures that the tragedy will happen.

     Actually the neo-liberal paradigm is to remove the commons…
3. nzfp 3

   7 October 2010 at 11:43 am

   Great post Marty,
   I like this comment particulary:

   Right now nations with large capital surpluses and those looking to diversify out of US dollars are looking for hard, food-producing and commodity-producing assets in stable, easy countries such as New Zealand and Australia.

   American Economist and Chief Economic Policy Advisor for the Kucinich for President 2008 campaign – Professor Michael Hudson made similar statements and gave warnings about Australia and Malaysia in a speech he gave in Australia in late 2009

   “Michael Hudson — Historical & International Perspective of the Global Economic Collapse”
   Source: http://reformthemoney.blogspot.com/2010/03/michael-hudson-historical-international.html

   At 1hr 10mins 25 seconds into the speech, Hudson comments on alternatives to the US dollar as an international medium of exchange when he describes a meeting with former Malaysian Prime Minister Dr Tun Mahatir bin Mohamed. Mahatir stated that it was not a good idea for Malaysia to build up international reserves because:

   … having international reserves is like having an oil well for a predatory army, in this case George Soros and the speculators. A country with international reserves, is just going to be a sitting duck for speculators to raid the currency and empty out the reserves into their own pockets by corporate trading and derivatives trading …
4. Colonial Viper 4

   7 October 2010 at 11:48 am

   Thanks for picking up on this and writing such thorough commentary Marty.

   Now, lets start thinking about what a world would look like which is aimed at helping people and communities thrive. One which doesn’t rely on unsustainable, ever increasing mounds of interest bearing debt created money and psychologically destructive consumerism/individualism.
5. nzfp 5

   7 October 2010 at 11:59 am

   Oh Marty,
   You are soo insightful. You state:

   “How do we cope in this world, which looks more like the pre-20th century international system then what we’ve come to think of as normal and natural in the last 60 years?”

   That is because we are living in the same economy as pre-20th century – before the economic reforms of the social democrats as advocated by the classical economists such as John Stuart Mills, Adam Smith, David Ricardo and of course Henry George.

   All of these economists recommended a tax system that placed the burden of tax squarely on land and economic rent and removed the burden from labour. The result was that land and labour costs decreased because industry didn’t need to include labour tax (income tax) into the costs of production, the economy had more money flowing as labour got to keep the majority – if not all of the fruits of it’s labour. The Government could fund itself from the tax on resource and land rents.

   This was the basis of classical liberalism, liberating labour and industry.

   With the advent of neo-liberalism (anti-liberalism) we got the complete reverse which puts us back in the same place we were before the social democratic economic reforms of the classical economists.

Links to post

1. The Standard: posted on 6 October 2010 at 9:41 pm
2. thestandard: posted on 6 October 2010 at 9:41 pm
3. Ben Haggin: posted on 7 October 2010 at 2:34 am

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