The Magic Market

64 comments on “The Magic Market ”

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1. ianmac 1

   20 June 2011 at 10:45 am

   Too true. It is like what would happen once every passenger was eligible for membership to the Koru Lounge?
2. pollywog 2

   20 June 2011 at 10:45 am

   Key also believes if we make the “right choices”, we can all be rich,

   …and therein lies the problem. Some of us don’t want to be rich and the assumption is, if one doesn’t want to be rich then there’s something wrong with us, as though we are infected with an incurable disease called ‘socialism’…whatever that is ?
   • Gosman 2.1

     20 June 2011 at 11:14 am

     Ummmmm….

     Where in free market capitalist philosophy does it explicitly, or even implicitly, state that there is something wrong with you if you don’t want to be rich?
     • Colonial Viper 2.1.1

       20 June 2011 at 11:29 am

       In fact the capitalist system relies on poor wage serfs in order to maximise return on investment to the capitalist wealth holding classes.

       So far from looking down on people who don’t want to be rich, neoliberalism loves them as an expendable resource.
       • Rusty Shackleford 2.1.1.1

         20 June 2011 at 12:20 pm

         CV, when you can explain how warfare and inflation are good for poor people, you can harp on about serfs.
         • Puddleglum 2.1.1.1.1

           20 June 2011 at 1:06 pm

           Oh, that reminds me. Rusty, I started to read the first of the links you offered up yesterday.

           I liked the bits about broken windows, not seeing all the consequences for all groups and failure to consider long-term consequences. It strikes me that capitalism is basically the young boy wandering around smashing windows. Economists (including the Austrians) are those who don’t see all the consequences for all ‘groups’ or the long-term consequences (this might surprise you – let me explain).

           Modern economies arise out of the destruction (‘window breaking’) of pre-existing wealth – usually in either or both of (a) the physical environment and natural ecosystems, or (b) human social systems and individual psychological systems. [A new economic principle comes to mind – ‘Wealth can neither be created nor destroyed; only converted from one form to another.’ I like to think that this is what Schumpeter meant by ‘creative destruction’ – but I know it wasn’t.]

           These functioning systems are destroyed so that their bits can be re-ordered in a way that produces what is normally considered (by economists) to be ‘wealth’ and ‘prosperity’. Really, though, it’s just like breaking something that provides you with some ‘good’ and then thinking that artificially re-creating it somehow improves your ‘wealth’ and ‘prosperity’ (i.e., broken window fallacy).

           Then, economists (including Austrians) come along to explain it all to us but, wouldn’t you know it(?), fail to realise that this ‘re-ordering’ of physical, natural, social and psychological systems has harmful consequences for other ‘groups’ (e.g., some non-human species) and harmful long-term consequences for us all (social and psychological dysfunction). There’s no such thing as a free lunch, as they say, and that includes the modern, global economy in toto.

           So, in conclusion, these Austrians were on to something but failed to extend their logic to its obvious conclusion and apply it to systems that far exceed these small subsets we call human economic systems. That’s a pity, because I know they prided themselves on being extremely logical and applying logic where others feared to tread. 

           Pity really – hoist on their own petard.
           • Rusty Shackleford 2.1.1.1.1.1

             20 June 2011 at 1:27 pm

             ‘Wealth can neither be created nor destroyed; only converted from one form to another.’

             What did the soviets convert wealth from-to. Oh, I forgot. Fridges and automobiles come out of the ground fully formed.
             • McFlock …

               20 June 2011 at 6:24 pm

               From: nice bits of farmland and natural scenery, stir in some ingenuity;
               to: a strip mine, smelter, foundry, factory, strip mall, and prime time sitcoms.

               And money’s now made from oil (assuming it’s not one of the starch polymers). The more we use of it the more we give it to other people to put it into our tank. Go figure.
             • Puddleglum …

               20 June 2011 at 8:43 pm

               Pearls, meet swine (to paraphrase one of your previous comments on another thread).

               As McFlock neatly summarises and generalises, that the soviets could so cavalierly ignore the ‘wealth’ they were destroying demonstrates the point I was making – in that aside – very well.
               • McFlock …

                 20 June 2011 at 9:07 pm

                 The soviets were as bad as the free market capitalists are – e.g. Somali fisheries stocks, Cambodian toxic waste disposal. The key is a happy medium, and I don’t mean in a Three Gorges flooding kind of way.
     • bbfloyd 2.1.2

       20 June 2011 at 11:36 am

       gosman…havn’t you been listening to key, english, bennett, brownlee, tolley etc lately? i would have thought you were hanging on to their every word.

       try being an apologist where it can do some good. on any talkback program you care to choose.
       • Rusty Shackleford 2.1.2.1

         20 June 2011 at 12:21 pm

         So, ya got nothn’?
     • The Voice of Reason 2.1.3

       20 June 2011 at 11:38 am

       It’s in Key’s words, gossy. He’s the head spruiker for capitalism round these parts and when he speaks, he takes it as a given that the ultimate goal of life is to be rich.
       • Gosman 2.1.3.1

         20 June 2011 at 1:32 pm

         So he mentioned this in a recent speech perhaps? Or maybe it was in something a little older. I presume you have evidence that John Key stated something along those lines.
         • Rusty Shackleford 2.1.3.1.1

           20 June 2011 at 1:34 pm

           Evidence? Don’t be daft. Gosman, you are a muppet. That is all the evidence I need (sarcasm).

           [lprent: Now that is perilously close to a pointless insult (saved by the sarcasm tag). Are you practicing? You really aren’t that good at it. 😈 ]
         • The Voice of Reason 2.1.3.1.2

           20 June 2011 at 1:37 pm

           Every speech where he ever used the word aspirational, Gosman.
     • pollywog 2.1.4

       20 June 2011 at 11:58 am

       Hmmm…Free market capitalist philosophy, is that kinda like social darwinism ?

       GET RICH OR DIE TRYIN’

       Eh fuck it..I’m gonna assume so. You do know what an asssumption is eh Gosman ?
       • Gosman 2.1.4.1

         20 June 2011 at 1:33 pm

         Yes an assumption is the mother of all f@ck ups.

         If you want to base your beliefs on flawed assumptions that is your problem.
         • Colonial Viper 2.1.4.1.1

           20 June 2011 at 1:34 pm

           Flawed assumptions are the only foundations of Chicago school neoliberal economics.
           • Gosman 2.1.4.1.1.1

             20 June 2011 at 1:42 pm

             …not to mention Socialist economics as well.

             See there is some commonality between the two positions 😉
             • pollywog …

               20 June 2011 at 1:52 pm

               Yes an assumption is the mother of all f@ck ups.

               If you want to base your beliefs on flawed assumptions that is your problem.

               oh you mean like English assuming treasury predictions of 170 000 jobs created and 4 % growth is on the money ?
             • Draco T Bastard …

               20 June 2011 at 1:56 pm

               You’re actually not wrong. Capitalism is a failure (results in massive poverty and stagnation) and socialism came about as a means to support that failure.
               • Gosman …

                 20 June 2011 at 2:03 pm

                 “Capitalism is a failure (results in massive poverty and stagnation).”

                 – You mean like what happened under Zimbabwe and Cuba following Socialist inspired policies?

                 Considering modern free market capitalism is approximately 200 years old, would you care to highlight where about the massive poverty and stagnation has occured in that time and how other nations/cultures have fared better following non-free market capitalist policies?
                 • Draco T Bastard …

                   20 June 2011 at 3:23 pm

                   NZ, Increasing poverty and stagnation (reliance on agriculture rather than branching out in high tech sectors) since the 1980s
                   UK, Same, also notable fora similar effect in the 19th century when they first went “free-market”
                   US, Same

                   The stagnation is due to laws that try and prevent competition especially modern IP laws. The poverty, which we’ve been seeing in greater and lesser amounts over time, is due to wealth being channelled to the few due to them finding ways to take ownership of the communities assets through control of the laws.

                   Basic history really. The facts always get in the way of capitalist memes.
                 • MrSmith …

                   20 June 2011 at 5:19 pm

                   Gosman you said “Considering modern free market capitalism is approximately 200 years old”
                    
                   The problem with this statement Gosman is there’s no such thing as Free market capitalism, it’s just a myth or an ideology and has failed in what it set out to achieve, your rubbishing every thing else doesn’t serve your argument, as its always possible to find a worse example of just about anything you can name, Capitalism was a good idea, they just forgot that Humans beings are Devious, Greedy, & Corrupt, so it was bound to fail.
                   • The Baron …

                     21 June 2011 at 3:01 am

                     you’re kinda off message there, Smith. Socialism as commonly understood requires people who aren’t greedy and selfish in order to make it work – how else could you handle having all of your output reappropriated according to where the state sees need? This is why socialist models keep breaking down – because people need incentives because people are greedy and selfish. socialist theory relies on a belief (hope?) that once the revolution has occurred, everyone will drop the selfish act. In the words of the ever arrogant Draco, if you believe in that, you’re delusional.
                     Capitalism doesn’t require a rebellion in innate human nature to work. You can lament this greed and selfishness as much as you want, but it isn’t capitalism that created it; and magically declaring socialism won’t change it.
                   • RedLogix …

                     21 June 2011 at 7:03 am

                     This is why socialist models keep breaking down – because people need incentives because people are greedy and selfish.

                     Ever thought that it might be the other way around?

                     Personally I do NOT believe that humans are innately feckless, lazy and greedy. I reject that totally. But in the WRONG conditions we do act in those ways.

                     Because it is my observation that humans are only really happy when they are in groups that are reasonably egaliatarian, respects individuals and shares everything generously. In those circumstances there really isn’t anything worth fighting about, and everyone has their needs met. Life is good. (If you think this pollyannaish… think about how close we aproximate this for a few weeks a year on the classic kiwi camping holiday.)

                     It is the combined forces of the moneylenders and the priests who tell us we are lazy, greedy, sinful… and our only redemption is work and suffering. They tell us we must not share, to hold the fallen in contempt, they freeze our hearts with materialistic desires…while they reap for themselves the choicest fruits of our efforts.

                     It is this form of controlling, exploitative capitalism that makes us miserable, and prompts some of us to behave in greedy selfish ways.
                 • Macro …

                   20 June 2011 at 6:54 pm

                   You really need to bone up on your history Gosman Cuba and Zimbabwe are completely different circumstances.
                   The poverty imposed on Cuba is a direct result of embargos introduced by its nearest neighbour USA. On a number of societal and equality measures, Cuba compares very well. It has already adapted to impending Peak Oil well before Western Nations – which are only now experiencing the beginnings of the impending implosion of their economies. Western nations are relentlessly pouring more Capital into a continually declining economic system (an economy which has been driven in the past by unrealistic prices of oil). We are now in the realm of decreasing returns from capital. That Gos is what the other commentators are telling you – The Capitalist system has failed – it has run its course riding on the back of cheap oil, and now we have come up against escalating Oil Prices and economies awash with Capital and consumption drying up.
                   As for Zimbabwe – that is not so much the result of a failed economic system – but of a despotic leader.
                   • ropata …

                     20 June 2011 at 11:22 pm

                     Zimbabwe: used to be the “bread basket of Africa”, now a high inflation, military dictatorship where state-sponsored goons force people out of their homes and steal their livelihoods,
                     USA: hmmmm…
3. Jim Nald 3

   20 June 2011 at 10:49 am

   Prime Magician Key’s next ACT is to make our assets disappear ! Whoosh!
   • Gosman 3.1

     20 June 2011 at 11:15 am

     How are these assets supposedly meant to disappear?

     Will someone come in and physically remove them from the country?
     • Colonial Viper 3.1.1

       20 June 2011 at 11:20 am

       Will someone come in and physically remove them from the country?

       Yep. Gone from the Government balance sheet.

       The other thing which will be gone is the income stream they provide to all New Zealanders.

       We’re already a nation of renters, paying foreign landlords.
       • Jim Nald 3.1.1.1

         20 June 2011 at 11:23 am

         CV is being rational, discerning and intelligent.

         Gooseman doesn’t lay golden eggs – sell the goose!
         • Colonial Viper 3.1.1.1.1

           20 June 2011 at 11:27 am

           Awwwww shucks
           • Rusty Shackleford 3.1.1.1.1.1

             20 June 2011 at 12:22 pm

             Just because someone says something you agree with, doesn’t make that person discerning. Nor, by extension, does it make yourself.
             • The Voice of Reason …

               20 June 2011 at 1:38 pm

               When’s uni start back, Rusty? We’re going to miss you so very much.
               • Gosman …

                 20 June 2011 at 1:41 pm

                 You know I think something similar for some of the drivel spouted by some of the left leaning contributors here but it would be more along the lines of primary or pre-school rather than University given the amount of intellectual effort put into some of the replies.
                 • McFlock …

                   20 June 2011 at 11:43 pm

                   as opposed to the intellectual rigour of claiming that if tories are in university, “the left” are sooo immachua, like pre-school level, y’know?
                    
                   At least try to lead by example, Gos.
       • Gosman 3.1.1.2

         20 June 2011 at 11:29 am

         So the experience of privatisation around the world is that, if they are bought by foreign companies, the physical assets are removed from the country they were in and moved someplace else, is that what you are stating here?

         Care to highlight a few examples of this in a developed world economy?
         • Jim Nald 3.1.1.2.1

           20 June 2011 at 11:38 am

           John Key wanna sell our assets
           You kiss his ass
           We kick his ass
         • bbfloyd 3.1.1.2.2

           20 June 2011 at 11:41 am

           care to stop being such a numbnuts goss. ? taking a deliberately ridiculous position is more about your displaying your own intellectual imbalance than adding anything meaningful to discussions.
           • Tigger 3.1.1.2.2.1

             20 June 2011 at 12:21 pm

             Well Gosman, we sold Air NZ and all the planes heading overseas…
             • Gosman …

               20 June 2011 at 1:35 pm

               Yes, never to be seen again…

               Well until it was brought back under Public ownership where upon they all magically came back.
4. freedom 4

   20 June 2011 at 12:05 pm

   After careful translation using ancient techniques known to Gorilla whisperers in the deepest Congo i have deciphered the Gosman scratchings that appeared earlier
   ‘My name is Gosman and i have a keyboard i can press keys and words show up and i can press buttons that have flashy lights and i get a banana or a apple.  The smiling man gives me hugs and makes me feel funny.
   When i close my eyes i can make bad things go away and when i put my fingers in my ears i don’t have to hear bad stories. But i can still make loud noises when i want to.’
   (Apologies to all animal trainers and their much loved friends )
   • Gosman 4.1

     20 June 2011 at 1:39 pm

     Funnily enough I asked for evidence to back up, what I regard as, ridiculous statements. That would be the opposite of the picture you are painting here.

     If as, you seem to imply, there is a mountain of evidence backing this position up then just present it and be done with it, (and by extension me). Instead you waste your time creating a Straw man ad hominem attack on myself, as if that somehow wins the argument. Bizarre thinking on your part I must state.
     • freedom 4.1.1

       20 June 2011 at 1:56 pm

       honestly, i am bored with the willing ignorance of supposedly intelligent people who refuse to admit that centuries of industrialisation and capitalist driven programmes have created an unstable and highly inequal Global economy
        
       if you need a thousand specific examples to have it proven to you then i despair at what complex machinations you face at the supermarket trying to believe claims of washing powder manufacturers
       • Rusty Shackleford 4.1.1.1

         20 June 2011 at 2:02 pm

         Wtf. Most NZers have access to more fridges, televisions, books, cars, food, healthcare etc than monarchs before the industrial revolution. They also live longer. Life is unequivocally better now than before the IR.
         • Gosman 4.1.1.1.1

           20 June 2011 at 2:06 pm

           Apparently not Rusty. We are now more unequal to when the vast majority of us lived in pig sh#t poverty. This is a bad thing if you bother to read the new Bible of the leftist intelligensia (sic) ‘The Spirit level’.

           Essentially although superficially better off we are in fact worse off and should all go back to living on communal farms, eating and growing our own organic food, and making our own clothes and other stuff.
           • freedom 4.1.1.1.1.1

             20 June 2011 at 2:23 pm

             and perhaps if some of those involved with the development and application of Commercial Industrialisation had a bit more humanity, then although progress would have been slower it would still have occured and the vast harm that transpires daily would have been greatly diminished.

             Our forefathers knew what they were doing, they knew and you know it is wrong.  Greed, which is really forsaking the will to help others, is a lousy way to win.
           • Draco T Bastard 4.1.1.1.1.2

             20 June 2011 at 3:28 pm

             Essentially although superficially better off we are in fact worse off and should all go back to living on communal farms, eating and growing our own organic food, and making our own clothes and other stuff.

             Ah yes, the false dichotomy of if we can’t have capitalism then we can’t have every modern thing. Total intellectual dishonesty but that’s what we expect from RWNJs.
             • The Baron …

               21 June 2011 at 11:41 am

               But it your world, we would go to building all these modern things ourselves, right Draco? Everything from shoes to cars to MRI scanners – all because international trade is some massive bogeyman.
               So no, I guess in your view we don’t need to give up every modern thing – we just have to be forced to buy locally produced, and probably for the most part inferior, versions of modern goods. Oh, and pay far, far more for them due to he inherent inefficiencies of manufacturing for a market of 4 million as opposed to a market of the world. Oh, and let’s not forget the massive environmental degradation caused by on shoring this production too, and the building of all these specialized plants to build all of this.
               Now that is frankly insane.
         • Puddleglum 4.1.1.1.2

           20 June 2011 at 9:09 pm

           Rusty, as I’ve said before, there’s no such thing as a free lunch – and that includes our modern economies. They come at a cost.

           One cost is that we have had to reorganise ourselves socially in order to ensure that industrial capitalism is possible. That reorganisation pulled apart (in fact, continued to pull apart) the evolved social systems for which our bodies and neurology were (and are) well adapted.

           We are now square pegs in the round holes of our new, modern social systems. Economists and ideological capitalists like to imagine that humans are infinitely adaptable and can fit quite comfortably, thank you, into any imaginable social arrangement. This is unlikely. Our current society – organised as it is around the imperatives of one form of capitalism – has measurable ill effects that stem from this mis-match.

           Adam Smith’s comparison of an English peasant and African chief (which mirrors your comment) shows the misunderstanding: The African chief had, in many ways – and contra Smith’s point in raising the analogy – far more of what humans need than did the peasant. (Despite the fact that the peasant had more manufactured goods in his modest dwelling.). There’s a trade-off. It’s not all progress.
5. randal 5

   20 June 2011 at 2:54 pm

   so what about the sub-prime market then?
6. johnm 6

   20 June 2011 at 3:19 pm

   The German Model works the U$ model ACTnat follows is a disaster. The Magic Market is self serving crap!

   “The intelligent way to think about capitalism is that it can be of two kinds. The good kind is patriotic and stakeholder oriented, the bad kind is selfish and shareholder obsessed.

   The U$ Disaster model:

   When those with power take actions purely to serve corporate financial interests even though it greatly harms employees, the middle class and the national economy then the bad kind of capitalism is being pursued. Think of the mass export of good jobs, especially in manufacturing, the preference for imported goods, and the investment of capital to build new manufacturing and research facilities in other countries. Maximizing financial returns to reward corporate bigwigs and stockholders even though the actions greatly harm the US economy and society results from US companies practicing bad, immoral capitalism. Think of this development as the conquest of Wall Street over Main Street, of those who make money over those who create and make products, of those who promote economic inequality over those who value the middle class.

   The German Model:

   The German economy makes the US one look like it is on its deathbed. The German tripartite system has business, labor and government working together. Faced with the same competition from low wage developing countries and the entire globalization condition, Germany has a booming manufacturing sector that constitutes almost twice the share of the economy than that in the US. And even in the current global economic recession German unemployment is 7 percent. The tripartite system has kept German labor unions strong and, therefore, protects the middle class whose pay has risen at roughly the same rate as top incomes. This is in stark contrast to the rich-getting-richer and union–busting situation in the US. Indeed, the top 1 percent in the US are seeing their proportion of total income rise dramatically, even as their German counterparts are seeing their share of total income shrink. German corporate boards are required by law to have an equal number of management and employee representatives. By law! ”

   Refer link: http://www.countercurrents.org/joel190611.htm
   • ropata 6.1

     20 June 2011 at 6:49 pm

     The Randians still believe in magic beans, useful suckers to have around if you are trying to prop up an economy based on illusion.
   • RedLogix 6.2

     20 June 2011 at 7:09 pm

     Yes, I like that a lot. For far too long the left has allowed the right to paint us as automatically anti-capitalist. Probably because everyone has been too loose with their terms.

     Or to paraphrase Churchhill when he was talking about democracy, ‘Capitalism is the worst possible system, except for all the others that have been tried’.

     The good kind of capitalism, as you describe nicely above, is good at innovation. In the modern world this has to be a desirable characteristic.
   • ropata 6.3

     20 June 2011 at 11:28 pm

     “There are two novels that can transform a bookish 14-year-kid’s life: The Lord of the Rings and Atlas Shrugged. One is a childish daydream that can lead to an emotionally stunted, socially crippled adulthood in which large chunks of the day are spent inventing ways to make real life more like a fantasy novel. The other is a book about orcs.”
     – “The Value of Nothing” by Raj Pate (VIA)
7. Samuel Hill 7

   20 June 2011 at 6:56 pm

   My blog:

   [lprent: evidently you didn’t read my previous notes. I’ll leave a link in…
   http://www.blogger.com/profile/02412285364780817941
   And put you in auto moderation until your commenting behavior improves. ]
   • McFlock 7.1

     21 June 2011 at 12:18 am

     Get an editor and chop it in half. And run it by a graphic designer (if it doesn’t look quite right to me, it’s probably bloody awful.

     I’ve got no taste and even I am thinking the design is a bit much).
     And maybe a short synopsis in your ego-advertising comments here, basically a paragraph or two on what your point is and why it’s relevant to the topic at hand.
     • Colonial Viper 7.1.1

       21 June 2011 at 12:46 am

       Another tip would be to go to smaller chunks by leading a reader through the content you already have, perhaps with more narrative and more examples, but broken up over 3-4 separate blog posts.

       Then you’ve got enough material to release over a month or so.
     • lprent 7.1.2

       21 June 2011 at 12:57 am

       Writing a synopsis would probably stop my moderator side editing his comments as well. That was the third identical one..
8. Frank Macskasy 8

   27 June 2011 at 10:23 pm

   Heard on the radio today: John “Dear Leader” Key, in an interview from India, promising us that a Free Trade Agreement with that country would deliver higher wages to New Zealand.

   Que?

   Isn’t this the same promise you made to us in 2008, during the Election campaign?!

   Why, yes! It is!! http://www.johnkey.co.nz/archives/306-SPEECH-2008-A-Fresh-Start-for-New-Zealand.html

   But, but, but… Dear Leader! You’ve just finished telling the country that higher wages will result in 6,000 workers being made unemployed! http://www.stuff.co.nz/dominion-post/news/politics/5039220/Lifting-minimum-wage-would-cost-6000-jobs

   Have you been fibbing (again), Dear Leader?
   • Colonial Viper 8.1

     27 June 2011 at 10:46 pm

     How are we going to compete with India if we have higher wages? In order to compete with India we need LOWER wages! Much lower.

     Oh. That’s the plan, isn’t it John.
     • Frank Macskasy 8.1.1

       27 June 2011 at 11:21 pm

       This is the TVNZ reportage of Key’s comments;

       “It means jobs, it means higher incomes, it means better opportunities for New Zealanders,” said Key.

       – http://tvnz.co.nz/national-news/more-jobs-higher-incomes-india-deal-pm-4262764

       I am reminded of an old saying; fool me once, shame on you. Fool me twice, shame on me.

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