The General Economics Thread

For folks in this thread, i'd recommend reading Hacker and Pierson "Winner Take All Politics". It talks about the how and why of the rightward shift, though their primary focus is on how that contributed to present inequality problems.

Is it time to retire the Actual vs Potential GDP chart and move on with our lives?

I'm pretty sure the AEI is right-leaning, and this line makes me want to laugh at them: "while inflation clearly has remained below 2% since 2008 we don’t know whether this is due to supply side factors or demand side factors."

Yes, we do know, and the story since 2008 has been all about the demand side. One hundred percent certainty.

That article is making excuses for calling the current stagnation the "new normal" and focusing on the poor maligned investors who are sad at their low interest rates.

edited 19th Sep '14 2:22:22 PM by Fighteer

Pay Pressuire: Economists from across the political spectrum (and across countries) offer their ideas to jump-start wage growth

It is interesting (but unsurprising) how the right-leaning economists talk about "ignoring inequality" and "dumping the minimum wage". They are the ones engaging in magical thinking.

It's like Bizarro World, where dropping the minimum wage will promote wage growth and where cutting taxes increases tax revenues.

Exception: Alaska would probably do better than most red states if it seceded. We have two advantages, of course: a smaller population, and the advantage of mineral resources, which are always as good as hard cash.

'course, there's the little problem that we'd have to stay independent if we wanted those mineral revenues to keep flowing to Juneau.

Alaska takes in $1.84 for every $1.00 it pays to Washington in taxes.

(figures as of 2011)

edited 20th Sep '14 7:24:31 AM by Ogodei

What would Alaska use for currency if it went off the dollar? Snow?

If it stays on the dollar, then it isn't really independent.

edited 20th Sep '14 7:36:33 AM by Fighteer

The Barrel (of oil, that is).

Rubles or Canadian dollars because Alaska wouldn't last long on it's own.

Pretty much.

Alaskan secession would, however, give Alaska control of the lands and mineral rights that the federal government received in exchange for allowing Alaskan statehood.

As above. I'd have to have full data to determine whether Alaska would be better off financially if they ditched federal taxes, but also nationalized federal land rights.

Alaska would probably survive succession; it's on the other side of Canada, so no one's gonna try to conquer it any time soon, and while it is a drain on federal resources currently, they could become self-sufficient without undue difficulty, as noted.

They still shouldn't do it, of course, no one should, but this is just a thought experiment.

Secession. Spell it with me.

ITT: People cannot succeed at spelling secede in succession.

More on topic: a field guide to hiring millennials. Ignoring the parts where the guy promotes his own business (read: half the article), he does have some good points. Businesses do need to update how they approach hiring.

How would California, which contains 1/6 of our population, fare if they seceded? They seem to have a lot going for them, from what I can see. They have their farmland areas, their high-tech sector that is responsible for companies like Apple and Google, a large population, and aren't they one of the wealthier states?

California has a high enough GDP to rank among the top nations in the world all by itself. Aside from water supply, it would do quite well on its own.

They're also in the middle of the worst drought in centuries.

EDIT: 'd

edited 20th Sep '14 2:39:05 PM by rmctagg09

Ironically, Texas could also be a pretty high-GDP country on its own if it were able to run itself at all.

Of course, as it stands it'd melt down into a smaller-scale Mexico in a hurry if they did manage to secede.

About Alaska: doesn't it still have a fair few onion domes dotted about? Don't look now, but... I don't think Russia has forgotten that it used to own the place.

I'd recommend putting off independence for a while, just in case. Like, say... leaving the idea alone for a century or so more.

edited 20th Sep '14 3:30:45 PM by Euodiachloris

Correct. Alaska was brought from the Russians, wasn't it?

Business News from the UK:

• Tesco cuts profit outlook again and suspends staff after accounting error
• EE to buy 58 stores from Phones 4u for 2.5 million pounds

• London Mining says it might end contract in iron ore dispute with Glencore
• Royal Mint launches online dealing account...in gold
• Siemens buys US oil and gas firm Dresser-Rand
• Challenger bank Aldermore announces plans to IPO
• Teenager in bid to become chief executive of Nisa Retail

Bought, yes.

Clearly, the Tsar at the time was making a deal that was invalid because it did not represent the will of the Russian people.

Same applies to the Louisiana Purchase? Mind you, the US did purchase the land from Napoleon Bonaparte...

'course not. Russia in this hypothetical situation wouldn't want Louisiana.

As with many other things, sexual culture responds to the economic trends of the time. Another sign of rising economic inequality — what Piketty refers to as "a new Belle Epoque" — is the rise of a "courtesan class": wealthy men paying through the nose for pretend relationships with younger women. In particular, this is targeted at college-age women. According to this article, close to half of "sugar babies" in these arrangements are women making their way through college and using the money "gifted" to them to pay their expenses.

It's darkly fascinating reading.

edited 22nd Sep '14 6:42:19 AM by Fighteer