But what is it about Paul–his brand or his substance–that pulls support from so many parts of the political continuum?
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"And [Paul would] shut down the Fed! Woo-hoo! That would be awesome: so then interest rates and the money supply could be controlled entirely by private banks, without even a theoretical modicum of public accountability! What progressive wouldn’t love that? And sure, the Fed was created by an act of Congress, but that doesn’t matter: a president with the determination of David Duke can just snap his fingers and poof! All the central bankers will be begging on the streets for change! Like I said, it’s fucking magic!" | BY TIM WISE::
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Every single one of the candidates currently running for the Republican nomination is a walking disaster. But one of them, Texas congressman Ron Paul, seems to be getting a disturbing amount of support from liberals. Mostly that's because his nut-job libertarian views happen to not sound so nutty on a handful of issues. He wants to end the War on Drugs. He is against the death penalty. He would support a constitutional ban on gay marriage. He was opposed to the War in Iraq and wants to end all American military intervention abroad. All of that sounds pretty good to us left-wing types — downright refreshing coming from a Republican. Some progressives have claimed they'd rather vote for him than for Obama. Even Occupiers have sung his praises. But if you're a liberal who supports Ron Paul, you either haven't been paying enough attention or you're out of your fucking mind. | BY LITTLE RED UMBRELLA::
- Paul criticized equal pay, AIDS patients, sexual harassment victims
Rep. Ron Paul (R-TX) may be the most principled and consistent Republican candidate for president, but what exactly are those principles? | THE RAW STORY
:: - Ron Paul Thought His Newsletters Were Pretty Great in 1995
Ron Paul's position on the newsletters with racist statements that were published under his name 20 years ago has changed quite a since then -- in a 1995 interview with CSPAN, for instance, he was pretty proud of them. | THE ATLANTIC
:: - Occupy protesters interrupt Ron Paul: "Why do you hate gays?"
Protesters with the 99-Percent movement have been interrupting campaign-related events all over Iowa. | THE RAW STORY
:: - On the Environment, Ron Paul Even Crazier Than Bachmann and Perry
OK, forget that he'd like to make it a criminal offense for a woman to get an abortion. How about that he thinks there should be no environmental protections at all? | TREEHUGGER
:: - A Bigot Through and ThroughThere isn't any reason good enough to support Ron Paul | ELIZABETH SCHULTE, SOCIALIST WORKER
OF RELATED INTEREST:
- The Trap: What Happened to our Dream of Freedom?
A series by Adam Curtis exploring the concept and definition of freedom, specifically, "how a simplistic model of human beings as self-seeking, almost robotic, creatures led to today's idea of freedom. | BBC
:: - The Austrian School of Economics is Crank Science
The Austrian School of Economics is a tiny group of libertarians at war with mainstream economics. They reject even the scientific method that mainstream economists use, preferring to use instead a pre-scientific approach that shuns real-world data and is based purely on logical assumptions. But this is the very method that thousands of religions use when they argue their opposing beliefs, and the fact that the world has thousands of religions proves the fallibility of this approach. Academia has generally ignored the Austrian School, and the only reason it continues to exist is because it is financed by wealthy business donors on the far right. The movement does not exist on its own scholarly merits.
::
- Noam Chomsky on Ron Paul and the US Libertarian Party
Noam Chomsky talking about US propaganda and how US Libertarian Party values like those advocated by Ron Paul contrast with Libertarian thought elsewhere. | YOUTUBE
::
- Ayn Rand Made US a Selfish, Greedy Nation
Ayn Rand helped make the United States into one of the most uncaring nations in the industrialized world, a neo-Dickensian society where healthcare is only for those who can afford it, and where young people are coerced into huge student-loan debt that cannot be discharged in bankruptcy. | READER SUPPORTED NEWS
:: - Pulling Back the Curtain on the Wall Street Money Machine
We are indentured to a Wall Street money machine that creates our money and lends it back to us at interest. We have forgotten our roots, when the American colonists thrived on a system of money created by the people themselves, debt-free and interest-free. The continued dominance of the Wall Street money machine depends on that collective amnesia. | TRUTHOUT
:: - On OWS, Ron Paul and the Fed
Ron Paul may hate imperial war, but he also hates Social Security and Medicare... We need to democratize the Fed, but let's not sign on with Ron Paul, please. And let's not join with the simple-minded right-wing critique that blames all of capitalism's systemic problems on government institutions. | LEFT BUSINESS OBSERVER
I have quite a few issues with this piece, which doesn't seem to be written by someone who knows very much about economics.
ReplyDeletehttp://www.huppi.com/kangaroo/L-aussm.htm
The "crank science" label actually applies quite well to the mainstream of economics whose love affair with complicated mathematical models resting upon unrealistic assumptions about individuals (e.g. they cannot affect each other's preferences) utterly failed to predict the financial crisis.
The mainstream method isn't very scientific. Econometrics is more of an art than a science, but is basically a hack. You can't run controlled experiments to isolate variables, so you take the data you have and "control" for variables with a variety of techniques that sound complicated mostly to obscure the fact that you can't really control for variables, you're just doing the best you can with what you have.
"To be a science, a school must produce theories that are falsifiable -- that is, verifiable. If a theory's correctness or falseness cannot be verified, then it is not science."
This is, again, a problem with *all* of economics. The two schools of thought in the mainstream are the New Classical and the New Keynesian schools, neither of which create falsifiable theories, but which instead employ Dynamic Stochastic General Equilibrium models to churn out papers saying what happens in these models and how much they look like certain parts of reality.
This isn't science either. The fundamental problem with all social sciences is that they are constrained from using the scientific method both from a moral and feasibility standpoint. One simply can't put an economy into a lab environment and see how much unemployment results when you raise interest rates during a recession.
The Austrian school is rightfully critical of the mainstream approach. Alas, I would agree that their response to return to inductive methods (the piece gets it backwards) is also wrong-headed. I would argue that the mainstream needs to get out of their ivory towers and away from their mathematical equations and do more fieldwork. I think in an age of powerful computers, they need to drop the individual homogenous rational actor model, move away from solutions that were favored because they had mathematically elegant solutions, and perform more simulations where agents have different and dynamic preferences that can affect each other.
But in terms of describing the recent crisis, the mainstream is almost at a complete loss. The two schools of thought within economics that come the closest are the Post-Keynesians like Hyman Minsky and Steve Keen (who focus on derivatives), and the Austrians (who focus on the Fed). To dismiss Austrians because mainstream economics dismisses them is unfair. The mainstream rejects anything out-of-hand that doesn't use DSGE and a lot of complicated math.
Thanks for reading and for taking the time to comment thoughtfully on one of the thirteen articles in this post. (I don't expect anyone to read all 13 or even a majority; I'm just pointing out that your comment is in response to 1 of 13 items here).
ReplyDeletei agree with you that mainstream economics could also be called "crank science," but you seem to be implying there's any legitimacy to the Austrian school because of this, but that's false logic. Both can be crank science. The problem with these theories is that they all claim to DESCRIBE reality, but in fact they're more often used to assert things that actually help GENERATE reality. The Austrian school posits perfect selfishness as not only possible, but desireable and right and natural. It thus serves to justify an assortment of suppositions that are used to justify economic policies which implicitly devalue cooperative systems.
So all I feel you've said is that all economics are not science. And I'd agree with you on that, but it doesn't actually obviate anything in the piece about the Austrian school, as far as I can tell.
If that piece was the only one I'd assembled here, I'd feel it was incomplete. But that's why I assembled the others. The Adam Curtis documentary "The Trap" is quite good and knowledgeable about these matters.
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ReplyDeleteMy main point wasn't to defend Austrian economics. My main point is that those linked essays grossly misunderstands both economics and the Austrian school in order to have made the mistake of praising the mainstream but yet critique Austrians with charges that are more accurately aimed at the mainstream. It's not a credible source at all.
ReplyDeleteIn terms of selfishness, this is also more of a critique of the mainstream than the Austrians. The DSGE models used by New Classical and New Keynesians use a model of individuals as rational maximizers of utility. Selfishness. The insight you are missing, however, dates back to Adam Smith to show that micro level behavior can lead to surprising macro results. Individuals acting selfishly can result in an efficient outcome for society (and I say "can" rather than "will" because there are always exceptions). So again, this attack is off target, and would be better aimed at folks like Christina Romer, Austan Goolsbee, Tim Geithner, and Larry Summers. So according to you, Obama trusts folks who believe in a crank science.
The Austrian school is actually less about models that assume rational maximization of utility and more about how the Federal Reserve, in controlling the money supply, is apt to make decisions that deviate from what people want, or malinvestment. Per the Comiskey & Madhogarhia piece I linked to on the FB thread:
"Perhaps the most serious charge against Greenspan is that he kept interest rates too low for too long up to 2004, then raised them too far too fast, precipitating the current crisis (Morris 2008, 59–65).
After the terror attacks of September 2001, Greenspan dropped the federal funds rate—the interest rate the Fed most directly controls—to a near-record low of 1%, and kept it under 2% until late 2004. These rates spurred a frenzy of mortgage lending."
Indeed, pretty much all economists, including the liberal Nouriel Roubini, now implicate Greenspan and the Fed as having a significant role in the crisis for feeding the housing bubble by growing the money supply too quickly. The Austrian school was the only one that warned of this problem with central banking beforehand (lookup "Peter Schiff was right"). The Austrian school is also the closest that modern macroeconomics has to a bubble theory (the mainstream didn't believe bubbles were possible due to the efficient markets hypothesis), so if economics is a crank science, I would say the Austrian School is one of the few not drinking the Kool-aid.
Anyway, with a baby to take care of, it'll take me some time to get to the others. I'd skimmed them and found this one to be the one most worth addressing. The rest seem like partisan character assassinations on the same level as conservative claims that Obama is a socialist, and not worth addressing. Or issues where liberals and libertarians simply disagree upon. I oppose a minimum wage as well. Price floors create surpluses, and in the labor market, that means higher unemployment. Expanding the Earned Income Tax Credit is a much better way to help the poor.
From the text in "The Trap", it sounds like Curtis misunderstands game theory. I guess he did not study economics either? The insight from the Prisoner's Dilemma isn't that people should betray others, it was a counterexample to Adam Smith in that people acting in their own self interest could get to a result that was worse for the whole (defect is better than cooperate on an individual level, but defect/defect is worse than cooperate/cooperate).
ReplyDeleteHowever, that is in the single-run case. When the Prisoner's Dilemma is repeated, then something else happens. A strategy known as tit-for-tat (default to cooperate and then, the next time you play against this person, do exactly what they did) emerges as a better strategy than always defect. This is what Matt Ridley describes in his book _The Origins of Virtue_ as an evolutionary reason that altruism developed, and the takeaway lesson is to highlight the importance of reputation in well-functioning markets and societies.
But if I'm missing Curtis's point, you'll have to distill it down for me.
Well, I appreciate this dialogue, but feel our propositional content, if you will, is probably farther apart than can be bridged in comment forums like these without truly exhaustive work and mutual intellectual good will. I really appreciate that you've engaged these posts substantively, though you do seem to me a bit sure of your conclusions -- i.e., your sweeping dismissal of Curtis based on "the text in 'The Trap'" -- when it doesn't sound like you did more than survey about fifteen seconds of screen time before asserting "the" insight of the Prisoner's Dilemma. Speaking frankly, I don't think what you're saying obviates what Curtis is saying, he's just bringing his own critical frame to the equation, rather than sticking with well-worn economic frames.
ReplyDeleteI believe based on what you've written here that you are operating more or less within those bodies of economic theory -- the frames you advance and the conclusions you point to all fall safely within them. Economic theorists have a way of discounting conclusions that fall outside their own specialized frames and internal logic.
So to me, you're arguing mostly specialized economic theories, with very selective interpretations, and drawing this entire conversation away from fundamentals and the likely social and economic impact of Ron Paul as a politician and would-be President, while engaging/luring me into a much more specialized conversation that isn't actually all that interesting or productive, in my opinion. No disrespect intended.
If Curtis's point is that the Prisoner's Dilemma leads to more selfish behavior, that is clearly incorrect. If that's not his point, what is it?
ReplyDeleteI'm at 14:07 so far of "The Trap." As I outlined earlier, this is a gross distortion of what the Prisoner's Dilemma indicates. Please read _Origins of Virtue_ pages 55-84 to see why. I'll try to find an online source, but for now, refer to Wikipedia:
ReplyDeletehttp://en.wikipedia.org/wiki/Evolution_of_cooperation
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ReplyDeleteI've watched Part 1 of Curtis's _The Trap_. The critique of Hayek on altruism is misleading, as it clearly cuts off Hayek before he expands on his point. He believes altruism evolved (recall the prisoner's dilemma and tit-for-tat) in societies where most people interacted with folks they knew. To transition to a larger society dominated by impersonal reactions, something needs to assume the role of altruism, and according to Hayek, that is the price and profit system.
ReplyDeleteHayek does not think that there is "no room for altruism". More on that here.
Regarding the prisoner's dilemma, there are a few misconceptions. Nash did not think the prisoner's dilemma applied to every single interaction. It was a very specialized case. Two players, two choices, and, more importantly, specific payouts for those choices picked such that individuals acting rationally to maximize their individual game resulted in the sum total of the payoffs to both players being less than optimal.
Far from arguing that people should act selfishly, the example argues that, in certain situations, selfish behavior led to a result that was bad for the whole. If you recall _A Beautiful Mind_, Russell Crowe utters the line "Smith was wrong" shortly before coming up with the blonde/brunette scenario. It is a counterargument to those who blindly worship markets.
Also note, the prisoner's dilemma is a specialized situation where your best choice is to defect *regardless* of what your opponent does. There are some real-world situations that mirror this (e.g. arms-races) but most real-world scenarios and games rarely have such clear-cut choices.
There are a number of *other* games within this normal-form game framework. The payoffs can be set to whatever you want, depending on what you are trying to model. There are games where cooperate, cooperate becomes the Nash equilibrium. Here are a few variations:
And as I've outlined before, the prisoner's dilemma can be shown to lead to an evolution of altruism, as per Ridley's _Origins of Virtue_ based on the work of Robert Axelrod. I couldn't find a better source than the original Wikipedia entry, but for what it's worth, this section is the relevant part, and the entry cites Axelrod's papers:
Instead of being a menacing vision where everybody must act paranoid and selfishly, game theory is merely a tool to model scenarios and situations (including altruism itself). And if you are biased against economists, note that Axelrod is a political scientist and Matt Ridley is a zoologist.
For some reason, the second part of this comment keeps getting deleted. I'm guessing your spam filter is complaining about the number of links. Will edit and repaste it.
ReplyDeleteWhat was more telling is that Curtis is critical of Hayek's vision of selfish behavior leading to good outcomes for the whole, yet also critical of game theory and public choice's observations that selfish behavior can lead to bad outcomes for the whole. Also, he criticized "Yes, Minister" for being propaganda, and then plays menacingly evil-sounding music when discussing public choice. Pot? Kettle?
ReplyDeleteAlso, he twists Buchanan's position on zealots. His quote clearly refers to politicians who think they know better what people ought to be doing. While this applies to liberal politicians who want to purge racism via legislation, this *equally* applies to the Santorums of the world who want to purge immoral behavior via legislation. It is hardly a description of are politicians who preach about public duty.
Indeed, public choice economics shined a light on rent-seeking, whereby special interests twist policy in their favor. This is exactly the phenomenon that Occupy Wall Street criticizes in regards to Wall Street currying favors from politician via lobbying and campaign contributions, resulting in the bailouts. Indeed, you can apply economic and public choice insights upon psychiatry to reach the conclusions Curtis does, as it is in the interest of psychiatry for more people to think they need psychiatry's services.
Economics does not teach that people *ought* to behave selfishly(although I would agree that there are many students that mistakenly believe this), but instead that people respond to incentives. When you see an outcome that is undesirable, you can often get to the bottom of the problem by examining the incentives of the actors responsible. Indeed, this can explain why Obama made claims about foreign policy reforms that he failed to live up to (as Greenwald detailed).
Finally, as you can tell from my first comment, I am highly critical of my field. If I am correct in assuming your field of expertise is journalism, then I hope you take a similarly critical eye to it. There is journalism whose intent is to educate and strives to be fair, there is journalism which persuades using facts and reason, and then there is journalism which persuade via misrepresentation.
ReplyDeleteCurtis's film clearly falls into that last category. He identifies some voices as "right-wing" without identifying himself as left-wing, he misinforms the viewer about various topics, and he resorts to various fallacies like straw men and ad hominem attacks (Nash's mental condition is about as relevant to the validity of his ideas as Keynes's sexual orientation).
Now, I've been going through your sources in good faith. So far, I think a lot of the above links fall into that last category as well, but I'll get to them in more detail. On my part, I've only cited three on the FB thread. Greenwald's Salon piece on Paul versus Obama (see previous comment), George Selgin on the gold standard, and Comiskey & Madhogarhia on the Financial Crisis (which includes discussion of the Federal Reserve's role).
What is your reaction to these pieces so far?
My reaction is that you're either on some odious payroll that supports you spending this much time online, or that you've got a severe paucity of stimulating engagement in other parts of your life, perfectlyGoodInk. I can't/don't wish to explain to you why your hyperspecialized battlefield of choice is not productive for me, without also expending far more time than is reasonable in a chat forum for a post that's had several hundred readers. I could tell you that based on this exchange, I do believe my frame and field(s) of interest are quite a lot more synthetic and esemplastic, and I could point out how you've focused mostly on one item or area of inquiry you obviously consider to be your strength, how you've avoided the retrograde racist statements of Paul (not others; he lied), or his ever-so-Libertarian desire to police women's uteruses, but I truly believe you are ill-motivated or just misguided in the way I consider many specialists to be. I said as much in my previous comment, before you posted 5 or 6 comments in response. I don't believe anything you've asserted is any great criticism of this post, but it's also important to note that I don't think people should just believe ANYTHING they read on a blog, or in a book. They should make up their own minds, hopefully with an awareness of their actual thought process, being careful of confirmation and disconfirmation bias. I'm content to let readers of this post and the ensuing comments make up their own minds -- I won't delete or censor what you've said, and will happily leave it open to readers of this (as I said, modest) blog to explore if they wish. This will be my last post in this exchange with you, but you are welcome to post yet more if you wish to further air your own critique of aspects of this post for prospective readers.
ReplyDeleteI consider economic education my mission in life, and when I run into pieces that I consider disinformation (whether it be this, or films like Grignon's "Money as Debt," they need to be debunked.
ReplyDeleteAs for Paul's racism, Greenwald's post is my response.
I do disagree with Paul on a number of fronts, including immigration, abortion, race, and somewhat on the gold standard. I disagree more with Obama in areas I don't expect you to agree with. However, as I said in the Facebook thread, "I will take an anti-war racist against a pro-war non-racist who believes in indefinite detentions. War kills more people, period."
ReplyDeleteI have to say, it's rather disingenuous to condemn my dismissal of a film (which wasn't a dismissal, it was an initial critique -- I had always intended to watch it later), but not then bother to read or respond to Greenwald's post -- which as you'll remember was linked in my very first response to you on the FB thread, or anything I've linked to or any of my points. If you're going to be dismissive of my sources, I think I'll respond and kind and not bother reading the rest of your links. The low quality of journalism in the ones I did read/watch didn't exactly inspire much confidence. Most of these sources were clearly aimed at a narrow liberal audience were more provocatively aggressive than informative.
I think my contributions have the most value when I stick to what I know, but I'm a lot more interdisciplinary than you think, and will gladly talk about voter theory, proportional representation, campaign finance, cognition, or whatnot. I even gave you an opening to steer the conversation to your area of expertise of journalism.
In terms of my free time and insinuation that I must be paid to do this, well this is an ad hominem attack. As we have common FB friends, you can go ahead and view my profile and see where I work. For the record, my job is to manage a team of economists. As that team is performing well right now, and given that our project is within the realm of economic education, and since I worked over the past weekend, I don't think I'm overly shirking my duties when I occasionally take some time to address economic misconceptions when I run across them.
Nowadays, I generally only get into one discussion at a time, which is a far cry from my blogging days. How the heck anybody has the time to maintain a regularly updated blog and still work, raise a family, and have a social life is beyond me.
By the way, I mentioned Grignon's "Money as Debt" film because the reason we crossed paths is likely due to the Burning Man community, and so if you know anybody on DPW, they may remember that long e-mail I wrote on the DPW list a couple years ago about how the Fed controls the money supply in response to someone who posted a link to that Grignon film. Again, I view my mission in life as economic education.
Most of my friends in the Burner community generally follow the rule of "assume goodwill," but I guess you do not.
No, I'm not part of the Burner community, nor do I think I know anyone on DPW. I actually didn't know this thread came about from an FB forum, either! And my own long-term experience with comment forums is that it's generally unwise to assume INTELLECTUAL good will, which is what I believe I said: and by that, I mean a goal of mutual understanding, not the goal of winning or being persuasive. I really do appreciate the energy and intelligence and commitment to being thorough that you've brought to these posts, and I'm happy to have readers look over them and explore what they will. But just because *you* want to, as you say, "stick to what [you] know" does not mean *I* want to focus, so lengthily, on what I consider only one aspect of a much larger complex of things represented in this post. I wouldn't have seen the value in steering the conversation towards journalism, to be honest.
ReplyDeleteI *am* curious about the "Money as Debt" film, may well check it out, and am grateful for the suggestion. I'm fascinated by gift economies. But hopefully you can understand that I am not choosing to engage these issues with the specificity you would find satisfying because I, too, have many other demands on my time.
All best. I look forward to observing Paul's path.
Someone in that FB thread I linked that to was also named "Loud Canary" who had linked this post, and I thought that was you. Sorry about any confusion from that assumption. When they brought up the newsletters, I responded by linking Greenwald's Salon piece on Paul:
ReplyDelete***
The candidate supported by progressives — President Obama — himself holds heinous views on a slew of critical issues and himself has done heinous things with the power he has been vested. He has slaughtered civilians — Muslim children by the dozens — not once or twice, but continuously in numerous nations with drones, cluster bombs and other forms of attack. He has sought to overturn a global ban on cluster bombs. He has institutionalized the power of Presidents — in secret and with no checks — to target American citizens for assassination-by-CIA, far from any battlefield. He has waged an unprecedented war against whistleblowers, the protection of which was once a liberal shibboleth. He rendered permanently irrelevant the War Powers Resolution, a crown jewel in the list of post-Vietnam liberal accomplishments, and thus enshrined the power of Presidents to wage war even in the face of a Congressional vote against it. His obsession with secrecy is so extreme that it has become darkly laughable in its manifestations, and he even worked to amend the Freedom of Information Act (another crown jewel of liberal legislative successes) when compliance became inconvenient.
He has entrenched for a generation the once-reviled, once-radical Bush/Cheney Terrorism powers of indefinite detention, military commissions, and the state secret privilege as a weapon to immunize political leaders from the rule of law. He has shielded Bush era criminals from every last form of accountability. He has vigorously prosecuted the cruel and supremely racist War on Drugs, including those parts he vowed during the campaign to relinquish — a war which devastates minority communities and encages and converts into felons huge numbers of minority youth for no good reason. He has empowered thieving bankers through the Wall Street bailout, Fed secrecy, efforts to shield mortgage defrauders from prosecution, and the appointment of an endless roster of former Goldman, Sachs executives and lobbyists. He’s brought the nation to a full-on Cold War and a covert hot war with Iran, on the brink of far greater hostilities. He has made the U.S. as subservient as ever to the destructive agenda of the right-wing Israeli government. His support for some of the Arab world’s most repressive regimes is as strong as ever.
Most of all, America’s National Security State, its Surveillance State, and its posture of endless war is more robust than ever before. The nation suffers from what National Journal‘s Michael Hirsh just christened “Obama’s Romance with the CIA.” He has created what The Washington Post just dubbed “a vast drone/killing operation,” all behind an impenetrable wall of secrecy and without a shred of oversight. Obama’s steadfast devotion to what Dana Priest and William Arkin called “Top Secret America” has severe domestic repercussions as well, building up vast debt and deficits in the name of militarism that create the pretext for the “austerity” measures which the Washington class (including Obama) is plotting to impose on America’s middle and lower classes.
The simple fact is that progressives are supporting a candidate for President who has done all of that — things liberalism has long held to be pernicious.
***
So while Paul has his share of flaws, I think they pale in comparison. The Federal Reserve also bears a significant portion of responsibility for the financial crisis, so it deserves more attention.