economists

Labor Day 2028

In 1928, famed British economist John Maynard Keynes predicted that technology would advance so far in a hundred years – by 2028 – that it will replace all work, and no one will need to worry about making money.

“For the first time since his creation man will be faced with his real, his permanent problem – how to use his freedom from pressing economic cares, how to occupy the leisure, which science and compound interest will have won for him, to live wisely and agreeably and well.”

We still have thirteen years to go before we reach Keynes’ prophetic year, but we’re not exactly on the way to it. Americans are working harder than ever.

Keynes may be proven right about technological progress. We’re on the verge of 3-D printing, driverless cars, delivery drones, and robots that can serve us coffee in the morning and make our beds.

But he overlooked one big question: How to redistribute the profits from these marvelous labor-saving inventions, so we’ll have the money to buy the free time they provide?

Without such a mechanism, most of us are condemned to work ever harder in order to compensate for lost earnings due to the labor-replacing technologies.

Such technologies are even replacing knowledge workers – a big reason why college degrees no longer deliver steadily higher wages and larger shares of the economic pie.

Since 2000, the vast majority of college graduates have seen little or no income gains.

The economic model that predominated through most of the twentieth century was mass production by many, for mass consumption by many.

But the model we’re rushing toward is unlimited production by a handful, for consumption by the few able to afford it.

The ratio of employees to customers is already dropping to mind-boggling lows.

When Facebook purchased the messaging company WhatsApp for $19 billion last year, WhatsApp had fifty-five employees serving 450 million customers.

When more and more can be done by fewer and fewer people, profits go to an ever-smaller circle of executives and owner-investors. WhatsApp’s young co-founder and CEO, Jan Koum, got $6.8 billion in the deal.

This in turn will leave the rest of us with fewer well-paying jobs and less money to buy what can be produced, as we’re pushed into the low-paying personal service sector of the economy. 

Which will also mean fewer profits for the handful of billionaire executives and owner-investors, because potential consumers won’t be able to afford what they’re selling.

What to do? We might try to levy a gigantic tax on the incomes of the billionaire winners and redistribute their winnings to everyone else. But even if politically feasible, the winners will be tempted to store their winnings abroad – or expatriate.

Suppose we look instead at the patents and trademarks by which government protects all these new inventions.

Such government protections determine what these inventions are worth. If patents lasted only three years instead of the current twenty, for example, What’sApp would be worth a small fraction of $19 billion – because after three years anybody could reproduce its messaging technology for free.  

Instead of shortening the patent period, how about giving every citizen a share of the profits from all patents and trademarks government protects? It would be a condition for receiving such protection.

Say, for example, 20 percent of all such profits were split equally among all citizens, starting the month they turn eighteen.

In effect, this would be a basic minimum income for everyone.

The sum would be enough to ensure everyone a minimally decent standard of living – including money to buy the technologies that would free them up from the necessity of working.

Anyone wishing to supplement their basic minimum could of course choose to work – even though, as noted, most jobs will pay modestly.

This outcome would also be good for the handful of billionaire executives and owner-investors, because it would ensure they have customers with enough money to buy their labor-saving gadgets.

Such a basic minimum would allow people to pursue whatever arts or avocations provide them with meaning, thereby enabling society to enjoy the fruits of such artistry or voluntary efforts.

We would thereby create the kind of society John Maynard Keynes predicted we’d achieve by 2028  – an age of technological abundance in which no one will need to work.

Happy Labor Day.

(via 25 Republicans Who Supported Obamacare Before Obama | Mother Jones)  Aug. 27, 2013


This is odd because the individual mandate, the cornerstone of Obamacare, was originally a conservative idea. It was first proposed by the Heritage Foundation in 1989. And scores of Republicans—not just Mitt Romney—have backed the idea in the past couple of decades. Here are some of the GOPers who supported Obamacare before Obama:

1. Rick Santorum? The Allentown Morning Call reported several times in 1994 that Santorum wanted to “require individuals to buy health insurance rather than forcing employers to pay for benefits.” Santorum denies allegations that he ever supported an individual mandate.

2. President George H.W. Bush: In 1991, Mark Pauly, an adviser to the first Bush, and now a conservative health economist, came up with a Heritage-style health care proposal for the president as an alternative to the employer-based mandate that Democrats were pushing at the time.

3. Former Vice President Dan Quayle: He was down with the Heritage idea too.

4. Mitt Romney: Romneycare was Romney’s signature legislative achievement as governor of Massachusetts, and it served as a model for Obamacare. During the 2012 campaign, the presidential contender had trouble deciding what his position was on Obamacare, and he deflected the blame for having conceived a similar plan;at one debate he noted that “we got the idea of an individual mandate…from [Newt Gingrich].”

5. Newt Gingrich: Though he reversed his position in May 2011, Gingrich had been a big supporter of the individual mandate since his early days in the House. In 1992 and 1993, when Republicans were looking for alternatives to Hillary Clinton’s health care plan, many, including then-House minority whip Gingrich, backed the Heritage idea. (Gingrich has said that most conservatives supported an individual mandate for health insurance at the time.)

Twenty of his fellow GOPers cosponsored a 1993 health care bill which included an individual mandate and vouchers for poor people. As health scholar Avik Roy wrote at Forbes in 2012, “Given that there were 43 Republicans in the Senate of the 103rd Congress, these 20 comprised nearly half of the Republican Senate Caucus at that time.” Here are those lawmakers:

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Paul Krugman Shreds GOP Contenders, Says They Are Their Own 'Hurricane Katrina'

Paul Krugman Shreds GOP Contenders, Says They Are Their Own ‘Hurricane Katrina’

Paul Krugman, arguably one of the best economists in America, loves to shut down the Republicans at any turn. He calls them out on not just issues in the economic/fiscal realm, but on social and cultural issues too. In a recent op-ed in the New York Times, he really laid into a few of the 2016 GOP contenders – Jeb Bush, Chris Christie, Donald Trump and Scott Walker. And, given the recent 10th…

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California’s always been for dreamers. Dreams of gold brought the forty-niners. Easy seasons and expansive arable acreage brought farmers, dreaming of an agricultural paradise. Fame, natural beauty, and the hang-loose cultural mosaic have brought dreaming millions to the state where summer never seems to end.

The summer dream has become a nightmare drought. But the years-long dry spell isn’t what keeps engineers, economists, and state water planners awake at night. No, they worry about the network of levees at the crux of California’s plumbing—a massive freshwater confluence called the Sacramento-San Joaquin River Delta.

Most of the state’s water is drawn from the Delta, protected by levees that pretty much amount to mounds of dirt, even when compared to infrastructure that infamously failed New Orleans during Hurricane Katrina. Hurricanes don’t hit NorCal, but these levees are alarmingly susceptible to disaster. If enough were to breach—in an earthquake perhaps, or severe El Niño storm—sea water from San Francisco Bay could rush in, tainting the water supply serving two-thirds of the state. The worst-case scenario could cause up to three years of severely curtailed water for most Californians.

California’s Katrina is Coming (via Wired)

crooksandliars.com
Insurers Say Private Medicare Plans Are Better, But We Really Don't Know

Health insurers have been telling us for years that their Medicare Advantage plans, which are federally funded but privately run alternatives to traditional fee-for-service Medicare, can provide better care—at lower cost—than the government.

One of my priorities when I worked in the industry was to perpetuate that notion. And I believed the PR, so much so that I encouraged my own parents to enroll in a Medicare Advantage plan. But is the PR true? The answer is, we don’t know, and we may never know.

That’s because, as health economist and researcher Austin Frakt pointed out in a commentary last week in The Incidental Economist, neither the federal government nor the insurers that operate Medicare Advantage plans will make the data available to enable apples to apples comparisons.

The lack of data hasn’t stopped the insurance industry from continuing the PR campaign. Whenever the Medicare Advantage program is threatened with a funding cut, the industry makes sure thousands of enrollees in the plans contact their Congressional representatives, and industry executives request opportunities to testify before friendly lawmakers about the superiority of Medicare Advantage plans.

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Some Economists Really Want Vermont to Enact Single-Payer Public Healthcare

“As economists, we understand that universal, publicly financed health care is not only economically feasible but highly preferable to a fragmented market-based insurance system,” the letter reads. “Health care is not a service that follows standard market rules; it should be provided as a public good. Evidence from around the world demonstrates that publicly financed health care systems result in improved health outcomes, lower costs and greater equity.”

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basically, what confessions of an economic hitman is about. i read this book years ago, and i find it hard to argue that this not close to what is happening in the world. this clip is made by the renegade economist, who are also behind the four horsemen feature film.

Overcrowded

I’m sure that it’s true that adding 10% more workers to London and letting them live like factory hens would make London’s corporations more profitable. Londoners may even acquire more tablet computers and smart phones. Yet our lives would be worse! Already the definition of a kitchen in a flat in Hackney is a line of cupboards down the side of the living room. Just how many times can they divide up these beautiful old houses into smaller and smaller boxes?

The mistake that these economists make is to become totally business centric. Their analysis stops at the profits of business and they fail to follow the process through to ensure that it benefits the population as a whole.

It is notable that the venerable economists who wrote the letter to Mr. Osbourne uttered not a squeak about the corporate profits which are being  filched away overseas to avoid paying tax as was reported in the same edition of the FT. Surely that too is “deeply damaging to the competitiveness of our science and research sectors and the wider economy”.

http://tinyurl.com/brkhqud

policymic.com
Leading economists urge US government to raise minimum wage

 On Tuesday, January 14, the Economic Policy Institute released an open letter to President Barack Obama and the leaders of Congress, urging the federal government to raise the minimum wage. The letter was signed by 75 leading economists – including seven Nobel laureates – and backed a plan sponsored by two democratic Congressmen. 

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“Government should be limited because its officials are unfit to plan other people’s lives.”

For more: http://www.libertarianism.org/columns/adam-smiths-criticism-government-knowledge#.velj1h:V9rZ

To put it bluntly, the discipline of economics has yet to get over its childish passion for mathematics and for purely theoretical and often highly ideological speculation, at the expense of historical research and collaboration with the other social sciences. Economists are too often preoccupied with petty mathematical problems of interest only to themselves. This obsession with mathematics is an easy way of acquiring the appearance of scientificity without having to answer the far more complex questions posed by the world we live in.
—  Thomas Piketty