Monthly Archives: January 2015

The answer to inequality.

I found this wonderful note in Krugman’s blog today. It confirms the fact that the rich really believe the nonsense they keep spewing out.

This Bloomberg report from Davos is making the rounds:

Billionaire Jeff Greene, who amassed a multibillion dollar fortune betting against subprime mortgage securities, says the U.S. faces a jobs crisis that will cause social unrest and radical politics.

“America’s lifestyle expectations are far too high and need to be adjusted so we have less things and a smaller, better existence,” Greene said in an interview today at the World Economic Forum in Davos, Switzerland. “We need to reinvent our whole system of life.”

Later in the article:

Greene, who flew his wife, children and two nannies on a private jet plane to Davos for the week …

PS: This guy was noted in a NY Times article the other day. He has put his estate in Beverly Hills up for sale for $195 million. I not only has a wine cellar and wine tasting room, but also, a first for Beverly Hills, a vineyard.  He will continue to reside in his estate in Palm Beach. By selling one of his two estates Mr. Greene is presumably achieving a smaller, better existence.

A New Democratic Vision?

The NY Times has a very interesting op-ed, by Thomas B Edsall today.Titled Can Capitalists Save Capitalism? it begins:

Key Democrats have reached agreement on a set of policies known as “inclusive capitalism”: a forceful market-oriented economic agenda intended to counter inequality, restrain the accrual of vast wealth at the top and provide the working and middle classes with improved economic opportunities.

From the White House to Congress to liberal think tanks, recent Democratic proposals would substantially alter the rules of the marketplace. These include major revisions of the tax code, legislation to pressure corporations to increase pay to match productivity growth and an expansion of refundable tax credits to include low-income workers as well as households making as much as $80,000 a year.

According to a report by the former Treasury secretary Lawrence Summers and Ed Balls, a top British Labor Party politician, unless there is serious government intervention, inequality and a lack of financial resources among those in the bottom half of the income distribution will result in “insufficient aggregate demand – too little spending by consumers and businesses to keep gross domestic product at its capacity.” Developed nations “need new social and political institutions to make 21st century capitalism work for the many and not the few,” Summers and Balls wrote.

“Inclusive capitalism,” according to its advocates, seeks “to make our economic system more equitable, more sustainable and more inclusive.” It is an international movement that has now made its way into Democratic Party circles.

In the US the problem of accelerating economic inequality has been pushed for attention by Bernie Sanders and Elizabeth Warren, and last night it became the heart of the message in Obama’s SOTU speech. Now Edsall is confirming its growth into a (the ?) dominating political issue defining the program of the Democratic Party. Is he right. We’ll see, but this op-ed is worth studying.

This could be a critical moment in domestic politics. In recent years there hasn’t been a single point of view that characterized the Democratic Party’s primary objectives. This may mean a shift to the left that will be uncomfortable for many, including Hillary Clinton. The Clinton White House was best known for playing to the Center. Inclusive Capitalism does the opposite.  Obama could hardly have described a program last night that would be more opposed to Republican “principles.” I say, good for him.

Being Mortal

I’ve been reading a fine book (Being Mortal) by Atul Gawande, a Boston surgeon who seems to have become the primary commentator at The New Yorker on the American medical system. There’s a good review of it in The New York Review of Books, although that reviewer seems to me a bit over-critical at  times.

It’s not an easy read. Dr. Gawande wants us to think about the fact that we are all going to die eventually and he notes that this process has changed significantly in recent years due to the outstanding successes of the medical profession. In the past, death was often a quick process with only hours or days between beginning and end of the process. Today  te medical profession has become adept at keeping us alive despite events that would have quickly killed in the past. The result is that many of us will die only after extended periods of chronic illness, and at each step in that process, the medical profession is adept at procedures that can attempt to prolong life.

Gawande illustrates what this means with examples from his practice and from his own family. Often the result is that treatments to prolong life succeed with a life of misery. In reaction to this has been the hospice movement and that of palliative care. Surprisingly these approaches, that emphasize patient comfort and life quality  over attempts to cure, are often more effective in extending life.

Gawande sees no easy solutions to the complex problems addressed here, and that is the power of the book. The case studies discussed here raise meant difficult questions. The discussion is sensitive and sophisticated.

The End of Robocalls?

Telephone solicitors are a bane of the modern world but we originally thought they could be prevented through the government Do Not Call registry. However, although this helps with legal services I have been suffering from sa surfeit of illegal robocalls, which ca generate a huge traffic through automated dialers.

Now I am trying out a free service that can stop these too. Its called Nomorobo and seems to work. It purports to automatically hang up your phone on autodialers after one ring. It doesn’t work on all phone carriers, so you have to try it yourself.

After one day I have gotten some one ring calls and no completed robocalls on my cablevision line. It’s a relief!

Why the Arab World Fights.

William Pfaff has a long and thoughtful article in The American Conservative with the above title. He puts the current turmoil in the Islamic world into historical perspective and makes a strong case for the West to avoid its penchant for intervening. He is not optimistic that his advice will be followed.

As he says: “One is constantly told that history must be consulted in order to understand the present, but in practice that rarely is done with an open mind.”

Recent History in One Chart

Here is Paul Krugman’s blog, published yesterday.  This is the data he discussed further in his NY Times column today. Look at the blog and its dramatic chart and then read his column.

A number of people have been putting up candidates for chart of the year. For me, the big chart of 2014 wasn’t actually from 2014 — it was from earlier work (pdf) by Branko Milanovic, which I somehow didn’t see until a few months ago. It shows income growth since 1988 by percentiles of the world income distribution (as opposed to national distributions):”


“What you see is the surge by the global elite (the top 0.1, 0.01, etc. would be doing even better than his top 1), plus the dramatic rise of many but not all people in emerging markets. In between is what Branko suggests corresponds to the US lower-middle class, but what I’d say corresponds to advanced-country working classes in general, at least if you add post-2008 data with the effects of austerity. I’d call it the valley of despond, and I think it’s going to be a crucial factor in developments over the next few years. More eventually.”