Posts Tagged ‘Recession’

An Armed Crowd is a Polite Crowd.

datePosted on 17:51, April 2nd, 2010 by Pablo

I heard this phrase when living on a ranch on the Arizona-Mexico border in the early 1990s. It was prompted by my asking a bartender at a local saloon if she felt threatened by the crowd of drunken, armed cowboys in the establishment one evening.  In that environment, it made perfect sense (in fact, Arizona has just legislated that a person can carry a concealed firearm without a permit, loosening the laws in force during my time in the state which allowed for the open carrying of firearms without a permit but which required a concealed weapons permit). In fact, on repeated visits to that watering hole I never once saw anyone raise their voice in serious anger.

I mention this because statistics have recently been released that show that the incidence of violent crime in NZ has increased exponentially in the last five years. That has led to the National government talking about “getting tough” on crime along the lines frequently barked by its ACT closet authoritarian partners.

But what does it mean to “get tough” on crime? More incarcerations? Longer sentences? More arrests? More convictions? More confiscations of property? More severe punishments? Reinstitution of the death penalty for heinous crimes? More tasering? Arming the community constables? Expanding the armed offenders squads? Increasing liquor bans in public places?  Having the police using more armed force when dealing with crowd control, gang and other collective disturbances? Increasing youth sentences?

I mention this because “getting tough” on crime, at least when phrased in the above terms, does not address the causal mechanisms behind the upsurge in violent crime (which I agree has increased and now become a serious pathology in NZ civil society). One can seek explanations for causes in many places: exposure to media-provided violence at a young age, dysfunctional familities, bullying culture, the pervasive influence of alcohol, the long-standing tradition of civil disobedience and passive resistance practiced by some communities and individuals, now taken to new extremes, the degeneration of popular and civic culture into venal self-absorption–the list of possible causes is long.  But what does “getting tough” have to do with any of these possible causes? Unless a more draconian criminal system is seen as a deterrent to violent crime (and there is much dispute about the deterrent value of things such as capital punishment), how exactly is “getting tough” on crime going to solve the problem?

I must confess to being of two minds, because as an immigrant from the US I have always felt that punishment for serious offenses was a bit of a joke in NZ and that there are not enough resources dedicated to crime-fighting  (in fact, I still believe that NZ is a country where one can literally get away with murder if cunning and meticulous). But I also know that the “tougher” US approach to crime also has done little to nothing to drive down crime rates (in fact, the “broken windows” approach to petty crime adopted in New York City in the 1990s, and in which worked marvels in lowering the overall crime rate in that city, was focused on early intervention at the lower end of criminality rather than on increased punishment for more serious offenses). Instead, US violent crimes rates, not surprisingly, lowered as the economy expanded in the late 1990s and early 2000s, and, not surprisngly, have increased since the recession began to bite hard in 2008. Which is to say, although the violence of socio and psychopaths is unaffected by economic cycles, much of the residual acts of violence tend to overlap with economic downturns when unmitigated by early intervention or causal prevention schemes.

Which brings back the cause-effect–response syllogism mentioned earlier. There is a reason why that crowd in the border town saloon was armed. At the time there were only 2 sherriff’s deputies avaliable to patrol over 1000 square miles of national forest and ranchland strung along the border and extending some 20-50 miles northward. Besides the various stinging and biting small critters and large predators (bears, big cats) that stalked the Sonoran high plateau and mountain ranges in which our properties were located, there were human dangers emanating from across the border as well as from within Arizona itself (organised crime drug smuggling and survivalist militas, respectively). Absent the protection of the state in such remote locales, people actually practiced the concept of self-defense because to not do so invited serious victimisation, often of a terminal sort. As the saying goes, the best home insurance policy one can have in such a personal threat environment is the sound of a pump action shotgun chambering a buckshot round. The point being, that armed crowd had reason to be so given the causal mechanisms at play in that particular crime environment (which I must say, remains one of the most beautiful landscapes I have had the pleasure to experience first hand). Unfortunately, perhaps, things changed after 9/11 and the region is now swarming with Border Patrol, National Guard, roadblocks, fences, audiovisual sensors and motion detectors as well as increased numbers of north-bound migrants, to the point that many long-term residents have moved away in search of solitude and workable land. It turns out, at least in that regard, I left just in the nick of time.

That brings me back to NZ, my adopted home since 1997 and in which I have seen a steady decline in civility during the last decade that is now confirmed by crime statistics. Not being a criminologist or a social welfare expert, I cannot offer any concrete prescriptions, much less a panacea for the upsurge in criminal violence now afflicting Aotearoa. But what I can say is that it does no good to play the role of chickenhawk or attack poodle by fulminating about getting tough on crime without linking the thirst for punishment to an understanding of what drives violence and insecurity in the first place. In fact, until the latter is identified, addressed and ameloirated, then the former is just another way of pouring salt into a gaping wound.

Climate credibility fail

datePosted on 07:30, January 19th, 2010 by Lew


I’ve remained largely silent on the so-called ClimateGate thus far, mostly out of an abject lack of expertise to judge the whys and wherefores of it all. It’s science, I’m not a scientist. But given Poneke’s magnum opus on the topic, the likelihood of an IPCC Himalayan glacier retraction and a NZ Herald survey which found that New Zealanders harbour deep doubts about anthropogenic climate change, I thought it apposite to repost something I wrote the other day at the bottom of a very long (but interesting) thread (somewhat edited). It’s something I’ve argued many times in other contexts.*

Climate change is often couched as an important problem of the sort which democracies fail to address — along with things like the global credit crisis, and fascism. But the failure is not with democracy itself, but with the calibre of certain actors within it. Climate change is an issue which should have been hit out of the park by any political movement with any competence, because the magnitude of the stakes and the weight of both reasoned evidence and benign symbolic matter which it embodies yield raw material for the most profound and powerful sorts of political campaigns — the sort which fundamentally change peoples’ beliefs and allegiances and which, if properly conducted, can grant a political movement incredible license to implement far-reaching policy of the sort which reforms society at its most basic levels. The Great Depression was just such an event for Franklin Delano Roosevelt and Michael Joseph Savage. The miners strike was for Margaret Thatcher. September 11 was for George W Bush. And so on.

And yet, the skeptics are winning the battle of ideas around climate change. The failure to convince the electorates of the free world of the need for urgent climate change policy, a matter of the most critical and immediate importance backed by the best science available, reflects an utter failure on the part of political and scientific elites whose most important job it is to provide such leadership. The political and scientific establishment has squandered a phenomenal opportunity, with the exception of Al Gore, who with An Inconvenient Truth did more to progress the cause of gaining electorate buy-in to the topic than everyone else has done since. They are struggling and failing, not only to implement reforms of the magnitude which are required, but even to maintain the credibility of the scientific establishment.

Some [including Ag, to whom this was originally addressed] argue that it was always impossible to sell climate change to the electorate due to the vested interests amassed against it, cognitive biases, lack of expertise, plain ignorance, etc. Those are important factors, but other factors are more important and more controllable to boot — after all, people in a liberal society can only really control their own actions, and must be prepared to defend their positions against others.

The scientific establishment failed by allowing a tiny minority of skeptics and raving moonbats and vested interests to frame their establishment as a corrupt back-slapping club funded by grant money; by evading and prevaricating and playing dirty when legitimately challenged on important matters of fact and procedure; most recently by covering up emails and giving the conspiracy theorists grist for their mills. In defending their failures, they blame the heterodox minority, the vested interests, the rapturists and the conspiracy theorists.

Politicians have failed mainly by couching their arguments in favour of urgent climate change policy in terms of hard facts and economic figures, assuming that people could connect the dots themselves rather than spelling it out in terms they could understand at a visceral or intuitive level as well as when they whip out their utility calculators. The politicians blame the same people as the scientists, ignoring the fact that a generation of failure on their part to adequately contest the battle of ideas and to safeguard the political process against the influence of vested interests has allowed such lobbyists to become entrenched.

Part of this is systemic — there are problems with the scientific peer review system which politicians can’t understand; there are ruthless and well-resourced lobbyists with vested interests which have been permitted to entrench themselves in democratic political systems. But none of that is any excuse. They should have been able to drive it home anyway, given the raw material at their disposal. This is not a failing of democracy, but a failing of certain actors within the democratic system: particularly, those who believe so deeply that they are right, so they need not prove their case. People who think that inherent truth of the position will simply shine through. If their position was that strong, then it should have been easy, right? This ignores a fundamental reality of a free society: that people are free to be wrong, and must be brought about by reason and persuasion or not at all. I think it is that strong, and should have been easy.

The world is going to pay for the failure of climate scientists to adequately protect their credibility, and for the failure of politicians and policymakers to adequately sell the most politically saleable concept of the past generation — that the planet is going to get inhospitable if we continue to pollute it, and we don’t have a fallback position — and it’s infuriating that those responsible for this failure want nothing more than to shift blame for their own incompetence.


* It should be clear, but nevertheless: I’m not arguing that AGW isn’t real; in fact, the opposite: I am arguing that the problem is real but that the credibility of much of the evidence and the policy agenda is critically undermined. I don’t really buy Poneke’s conclusions drawn from his analysis of the emails, although I do accept that they demonstrate severe systemic and credibility failures which call a lot of the evidence into question. But in order to believe that it’s all a hoax, you have to believe in a scientific conspiracy of unprecedented scale, with no credible payoff. I just don’t see it.

Rethinking market socialism.

datePosted on 20:15, March 28th, 2009 by Pablo

The crisis of the latest incarnation of market -driven economics, particularly in its financial sector, has raised the possibility of political-economic alternatives not so much as remedies but as significantly different approaches to the structuring of national economies in a global system of production and exchange. One of these is a revamped–as opposed to resurrected–market socialism. For those who are not familiar with the concept, a quick synopsis is found here. Although current conditions are different from those that led to the original formulation, some basic tenets can be discerned and elaborated upon. Basically, within a market system of supply and demand, the state operates as a macroeconomic manager (not just a toothless regulator) by obtaining majority stakes in strategic assets (be they primary good or value added). In parallel, at a mircroeconomic level it moves to promote significant (be it as a majority or as part of a tripartite arrangement with the state and capitalists) worker ownership in strategic industries (such as through employee stock option programmes  (ESOPs) or by encouraging the formation of cooperatives) in exchange for wage restraint and greater productivity. The logic is that with workers as co-owners of the industries in which they are employed, they will understand managerial rationales as well as the conditions on the production line, thereby promoting what could be called “equitable efficiency” in production.  Non-strategic components of the economy can be encouraged to follow suit but will not be forced to engage in such “socialising” programmes, but will be taxed at a higher rate if worker participation schemes are not incorporated. All sectors will follow the laws of economic efficiency followed by private firms–that is, the market logics of supply, demand and prices. Hence, the object is to prevent rent seeking behaviours usually associated with state ownership of the means of production–to wit, no “make work” or ghost worker schemes, no padding of employee roles, no patronage or clientalistic networks etc. Needless to say, unions may see a threat in this, but their self-interest as agents should not detract from the potential benefits of ownership accrued by workers as a class as well as principals of unions (where they are organised). Union shareholding schemes might be one way to reconcile the interests of agents and principals in such an event.

Under such a market socialist approach a restrained individual taxation rate that increases the amount of discretionary income to wage-owners as well as as capitalists can be complemented by a differential corporate rate that rewards worker ownership with lower rates while maintaining a higher rate for “traditional” firms–i.e. those that appropriate the surplus generated by workers in the form of profits that are in the majority distributed to non-workers (be they shareholders or managers).

With a greater State macroeconomic presence as a stakeholder in strategic industries and manager of microfoundational (the orientation of specific  industry) policy, coupled with active promotion of worker participation in ownership of the industries in which they are employed, backed by a taxation policy that rewards those who see the wisdom of making workers co-owners and understand that the State, as representative of all sectoral interests, is better suited for macroeconomic management than individual capitalists or their associations, a new market socialist project can be advanced that will filter global market dynamics into a more nuanced, and fairer, distribution of wealth and income in society. In a small island trade-dependent state, socio-economic stability depends on this.

There is actually a model for such a system, although it has yet to incorporate worker ownership schemes as part of its developmental project. That model is Singapore and the only reason it does not incorporate policies of worker ownership  into what is otherwise a state-dominated export-oriented economy that is successful is that it is a)authoritarian and thus can impose its will without worrying about the filter of mass consent;  b) foreign investors resist worker participation as a condition for investment; and c) as a result of the previous two factors, foreign workers on temporary visas unprotected by labor laws reserved for Singaporean citizens are used to structurally undermine any moves in that direction.

As a liberal democracy NZ can not emulate everything that Singapore does, but what it can do is note the commanding position of the State in its macroeconomic affairs, to include its use of  State holding companies as channels for public investment in a range of “private” industries as well as its use of taxation as an incentive for corporate investment and production, on the one hand, and household consumption on the other. Admittedly, the argument presented here is just a simplified sketch of the possibilities of market socialism in the present conjuncture, but the intention is to raise the point rather than fully elaborate upon it. The latter task is left to the readers.


datePosted on 17:47, March 3rd, 2009 by Lew

As a dedicated media geek, I wake up each morning to New Zealand’s broadcast news of record – the masterful Geoff Robinson, the muscular Sean Plunket, and the metronomically-consistent Nicola Wright on Radio NZ National’s Morning Report. These three I consider to be among the top talent in the NZ media industry, and we are fortunate to have them.

I also have a lot of time for Checkpoint‘s Mary Wilson – not quite so obdurate as Sean Plunket, but with as little patience for prevarication. It seems the producer who put together the advertising frob for Checkpoint which aired between the sport and weather segments of yesterday’s 0600 bulletin also has a good ear. You can listen to it here, but I’ve transcribed the good bits:

First speaker: We are not a country of whiners, we are not a country of slackers and we are not a country of selfish individuals. We are a gritty little country with the smarts and determination needed to weather this storm.

(Mary Wilson introduces Checkpoint)

Second speaker: You feel as though you’ve been marched out with a blindfold on and tied up to a pole, and your own army is there as the firing squad.

Now, neither of the speakers either side of Wilson is identified. That’s an important point – the first speaker is immediately recognisable as John Key, and his words are clearly to do with the recession and economically troubled times ahead (in fact, from his opening speech at the Job Summit); a bold bit of chin-up-what-what jingoism. Even if you don’t know who the second speaker was or what he’s talking about, his statement is so strongly worded and his tone so far removed from Key’s that they jar in relation to one another; and although the statements are topically different, their contrast and proximity to one another implies a relationship. Although they’re not obviously linked, a listener (in principle) goes away associating John Key’s upbeat jingoism with one’s own army as the firing squad – a hugely disturbing mental picture if you care to think about it. This is an example of the semiotic technique of associative montage, perfected by Soviet filmmakers, where parts of a text are contextualised and given affective weight by their relationship to other parts of the text (in this case, audio; in the classical case, still or moving images on film).

Because I failed to listen to Checkpoint last week when the story about the Army raincoats was in the news, it took a bit of research to find out it was Davey Hughes of Swazi who said the second bit. And it turns out that there is a link between the statements – but not the link you might expect; a real army but a metaphorical firing squad, and nothing to do with John Key. As a matter of reality, the government isn’t in a position to force the NZDF to choose one supplier over another mid-term, and to do so would set a dangerous precedent and open the government up to well-justified allegations of protectionism.*

Not that this makes any difference to the message as received by a naïve listener to this piece. Montage, like other semiotic grammars but perhaps to a greater extent because we’re unused to it, transmits its meaning subconsciously. Actual rational reality doesn’t necessarily get a look in. Now, I’m not arguing that there’s a wily frob-producer at NatRad who’s employing Soviet montage techniques to propagandise John Key in the minds of loyal public-service broadcasting listeners, though I suppose if you were especially paranoid you could argue that airing it at wake o’clock in the morning makes it easier to prey upon the weakened rationality of the half-asleep.

This is the stuff of which peoples’ impressions are made – people have a feeling about a leader, they can’t quite put a finger on it and haven’t necessarily given it any serious thought, but nevertheless it’s their opinion and they cling to it. Despite Labour’s technically excellent but somewhat nasty `Mary’ ads in the dying days before the election, there seem to be very few such impressions of John Key. But he’s a leader going into a long term of economic downturn, and he can look forward to more such as this.


* You could argue that the NZDF should choose NZ-made gear – and the All Blacks should use Canterbury rather than adidas – but the fact is that Key can’t simply make it so.

Women are paying for bankers’ excesses

datePosted on 12:26, February 20th, 2009 by Anita

The recession is spoken about as if it is universal: blind to gender, class and race it will hurt us all. Yet the reality is that groups which are already disadvantaged will pay the biggest price: not only are they they worst affected, but our government is providing them with the least support.

This is not the first time this pattern has occurred, the Asian recession in the 1990s forced women out of the workforce and back into the kitchen, or overseas, or into sex work. This recession is no different, early last year a US Senate committee investigated the impact of the growing recession and reported

These findings clearly demonstrate the severe and disproportionate impact of this recession on women and their families.

Analysis in the UK similarly predicts more severe effects on women. In New Zealand no-one seems to have done the research yet, but there’s every reason to expect the same outcome: women will experience redundancy, loss of hours, and reduced pay at greater rates than men.

So our government’s response? Well there are the tax cuts, which will disproportionately benefit men, there’s the economic stimulus package which appears targetted toward working men and, of course, Tony Ryall’s instructions to the public sector to suppress women’s pay.

National is determined to keep bankers in business, corporates afloat, construction workers busy, and boost the pay packets of the wealthy; women should expect no help as their jobs, hours and pay are cut.

Four-day week – analysis?

datePosted on 23:17, February 19th, 2009 by Lew

Since I spend my workday up to my eyeballs in the media, it’s very rare that I watch ONE News Tonight, and even rarer that I come across something I don’t already know.

(Red Planet Cartoons)

Today, I managed to elude the fact that the government is considering support for a four-day week for businesses which might otherwise consider layoffs, paying (part of?) the fifth day’s income, while staff undertake training or community work. Until Tonight, that is. This seems to me an excellent idea, if it can be well-implemented. It accounts for the necessary scaling-back in production which some industries will experience, while subsidising future productivity increases to come from improving the skill base of NZ workers, which means that once the recession passes, the country will be better-positioned to hit the ground running, as it were, and enable the government to pay back the debt which will necessarily accrue from the scheme.

(As a sidebar: that a National government is even considering such a thing represents a huge change in political culture.)

There are certainly pro- and contra- arguments to this sort of scheme which I’ve not considered; as you can tell by the cartoon, I’m not unaware of the general uselessness of make-work-for-the-sake-of-making-work schemes. Friedman’s quote, on the linked site, is especially well-taken:

“If all we want are jobs, we can create any number — for example, have people dig holes and then fill them up again, or perform other useless tasks. […] Our real objective is not just jobs but productive jobs”

The question is one of implementation: what would be necessary for a make-work scheme which results in productivity improvements down the line to be better than redundancy – the consequent productivity increase that brings as they try to better themselves, less the productivity drain they represent, being out of money and therefore not consuming, or on welfare?

This is a complex question, and I invite you to argue your corner. But please, I’m not interested in ideology-bound doggerel of the `OMG statist corrupt meddling communism’ sort, or its inverse – I’m not an economist, but I expect a high standard of analysis, the more formal the better.


National: cutting their way into the recession

datePosted on 07:28, February 18th, 2009 by Anita

At Pundit Nicky Hager has an article up about National’s “spending” plans. Based on leaked material he shows that, having started to realise the gravity of the recession, English has increased capital expenditure by no more than an additional $250 million of capital spending a year: in terms of government spending that’s nearly nothing. As Hager concludes:

As the country heads into the worst recession of our lifetimes, John Key and Bill English have decided against any significant economic stimulus package. As other countries acknowledge the magnitude of the crisis and spend, our Cabinet will be putting their energy into finding places to cut.

At the same time the National cabinet is taking a knife to operational spending: 10% here, at least 500 jobs there, 30 more over here. These cuts of operational cuts will very quickly add up to $250 million, not to mention poorer services for all New Zealanders,

So National’s plans to get us out of the recession are… exactly what their plans always were: cut, cut and cut. Less service, less support, and what money there is will be redirected to the private sector labelled “infrastructure investment” and “improved competition”.

Short not-sharp shock

datePosted on 10:26, February 11th, 2009 by Lew

NatRad’s PCR Jane Patterson on Nine to Noon this morning characterised the government’s counter-recession plan as “drip-feeding”, opposed to Obama and Rudd’s “big bang” approach (audio). But drip-feeding would imply a long-term commitment, and Key doesn’t believe the recession will be a medium or long-term problem.

Rather than either of those metaphors, I would characterise the front-loading of already-planned expenditure and development into the coming six to eighteen months as a short sharp shock; however, given the relatively small amount of expenditure and development in the plan, it’s not even very sharp. Of course, there’s the argument that the government doesn’t have any more money to spend, but Key has bet on a short recession, and that implies short-term debt. I would think that if one was betting on a short recession, one would do everything in one’s power to ensure it was a short recession.

If it turns out to not be a short recession, Key (and English) will have to return to the drawing board, and that will very likely mean another short (perhaps sharper this time) shock, rather than introducing a strategic counter-recession plan mid-term and mid-recession. DPF raises (in some jest) the idea that Key might emulate his hero Muldoon on another matter, but to me it looks like this track could lead to economic micro-management of a very Muldoon-like nature. And the broadband plan is very Think Big.