Reply to John Quiggin's Zombie Economics

By Con George-Kotzabasis


Are you proposing an unbalanced budget as a way out of zombie economics and long term prosperity? To live beyond one’s means is to live in FALSE prosperity that will not last long, as the present situation in Europe shows starkly. Moreover, a false prosperity encourages and incites a stampede of speculative bubbles that with algorithmic precision blow up in a bust. You are confusing austerity as a ‘drug’ and austerity as a ‘poison’. As a drug it cures your insanity to live beyond your means; as a poison it exacerbates the illness of recession by depriving you of the stimulants of a Central Bank that could weaken the virus of recession and cure it gradually, if one uses the funds wisely to reinvigorate the REAL economy and boost entrepreneurial creativity and innovation, as the leader of the Opposition in Greece, Antonis Samaras, last May, proposed in his Zappeio Address.

Hence, your “zombie” austerity turns into a boomerang and hits you with all the force of Newtonian gravity in your confused austerity.

The Fallibility of Technocrats No Reason to Debunk them

By Con George-Kotzabasis

“We work in the dark—we do what we can—we give what we have.” Henry James

Science has been built on a “mountain” of errors. No correct policy has arisen—like Athena out of Zeus’ head—from an immaculate conception but from a compilation of corrected mistakes. The task of a wise, imaginative, and intrepid technocrat is not to despair before mistakes, like professor Yanis Varoufakis, and be pessimistic about the future, but to overcome them. This is the task and challenge of both Mario Monti and Lucas Papademos as premiers of Italy and Greece respectively, whom both professor Varoufakis disparages, as well as, in the case of Greece, of the statesman, Antonis Samaras. But obviously, it is not the task that can be consummated by professor Varoufakis. Although one must admit that in his Modest Proposal, with Jonathan Swift's title, co-authored with Stuart Holland, surprisingly, he takes a positive and optimistic view how to resolve the European crisis.  

 

In their Nightmare of Capitalism all Leftists are Millenarian

By Con George-Kotzabasis

Historically and by definition all from the left are millenarians who being terrified with their capitalist nightmares are countervailing them with their millenarian dreams.  And if you don’t dream Marxist ‘dialectical’ nightmares but only Kant’s dream of “Eternal Peace,” der Ewige Friede, then that still makes you a millenarian.

All men/women of reason abhor war. But sometimes war is necessary to prevent a greater catastrophe. And it is through war and strife against the enemies of humanity and freedom that mankind can achieve relative stability and peace. “Nothing for nothing” to quote the economic historian David Landes. I, like him, “prefer truth to goodthink.”

Radical Liberals Condemn and Disparage Technocrats

The following exchange took place between an American radical liberal and me on the appointment of the two technocrats Mario Monti and Lucas Papademos as prime ministers of Italy and Greece.

Bruce Wilder says,

You seem to have lost the essential premise: the “looming economic catastrophe” is largely the creation of the technocrats, and “all the misery that implies” has been embraced by the technocrats with all the enthusiasm an 18th century physician had for purgatives and bleeding.

Con George-Kotzabasis says,

Bruce Wilder, your “essential premise” walks on crutches. In a physical crisis in which you might lose your leg you don’t stop from going to a surgeon just because there are bad surgeons about. To label all surgeons (technocrats) as incompetent and refuse to go under their knife is to lose your leg. That is why your argument, factually and intellectually, waddles on crutches.

Bruce Wilder says, 11.13.11 at 6:09 pm

Con George-Kotzabasis @ 105

If your life was threatened by a growing cancer, affecting your lungs or your kidneys, and you went to a surgeon, and the surgeon said, “To save your cancer, I recommend amputation of your leg,” I would hope you would run from the room, with your legs still intact.

These particular neo-liberal technocrats are just these sorts of mad incompetents, prescribing senseless maiming in place of a treatment plan. There are, apparently, no politicians available, to stand up and veto the insanity, “brave” and “charismatic” or otherwise.

The corruption and incompetence of the politicians—indeed, the whole polity—in Greece and Italy—played nearly as critical a part in the epidemiology of crisis as the neoliberal technocrats. It is worth remembering that the popular support for the European project has often rested on the hope of improving the quality of governance and institutions. For all the grousing over the minutiae of Brussels and the trivia of Strasbourg, the hope of European Union was always to promote high-minded, principled liberal institutions as a prophylaxis against authoritarianism and populist corruption. This was, I suspect, always a very big part of the appeal of the euro: German monetary policy for the South, an internationally respected currency immune to runaway inflations, etc. The Italians, as I recall, embraced the euro ahead of every other country; they were overjoyed to be rid of the lira, the joke currency of Europe, so inflated in value that coins were impractical—phone booths required a special token and street vendors gave candies in place of change. The euro is very popular in Greece as well, and I suspect that that popularity, as much as the fecklessness of politicians, is a factor in preventing Greece from taking the obvious step of unilaterally embracing default in abandonment of the euro. (Purely from a technocratic point-of-view, the equivalent of a competent surgeon would be a technocrat doing the preparations in secret, which would make a unilateral return to the drachma feasible. That’s the “right” thing to do for Greece, from a “technical” standpoint and from the standpoint of protecting Greece from the “amputation” of privatisation and a prolonged deflation. An efficient calculating machine would have been crystal clear from the outset that, on the numbers alone, Greek default was inevitable; delay could only prolong and intensify the suffering.)

The Big Picture, here, may well be that economic and institutional centralization has found its limits, at least for the moment. Certainly, the neoliberal architectural principles employed over the last 25 years are a bust. Are we so stupid that neofascism must follow? Many would say that authoritarianism was always an implied part of the neoliberal agenda.

Con George-Kotzabasis 11.14.11 at 2:10 am

Bruce Wilder
In serious discussion it is wise to enter it carrying a sieve in one’s hands to separate the wheat from the chaff.

Your crystal clear “efficient calculating machine” that would implement your proposal of default, would be no other than a wise, brave, imaginative, and humane TECHNOCRAT. So what exactly you have against technocrats? They are OK if they adopt your plan and only transported to Hades in toto for their mortal sins, if they don’t! Default was and is always an option. The distinguished economist Deepak Lal and exponent of the Austrian School of economics, long ago suggested such a schema. Lucas Papademos and Mario Monti both presumably have this option in their arsenal to be used as a last resort if everything else fails. But before they use this ‘nuclear’ option, they must try, and be given the right by all objective analysts and commentators, to resolve this economic crisis by ‘conventional’ means that could avoid a default which would open a big hole in their countries GDP and throw their people into pauperization for decades to come.

Bruce Wilder says, 11.14.11 at 2:37 am

Instead of “support the troops”, we are now asked to support the neo-liberal technocrats.

Con George-Kotzabasis, are we to take no account of the part the technocrats played in “designing” the euro? Are we to take no account of the failure of the ECB to carry out bank supervision or to regulate derivatives? It is a little late in the progress of neoliberal disaster capitalism to be attributing good faith, let alone expertise, to these bozos.

Climate Scientologists Preachers of the Gospel of Truth

By Con George-Kotzabasis

Ironically by the logic of the opening of his article Jones seriously puts in a coma his own argument.  When he says that the critics of Dr. Garnaut accuse him of using the so called “discredited science of IPCC” and answering this that “in fact the Garnaut review relied on the Australian climate science community to make its scientific case,” he does not realize that the deduction from his own answer is that the IPCC report is based on “discredited science”, since he replaces the latter with the presumably better scientific credentials of Aussie science.  And the relentless vengeance of his own logic leads him to administer the coup de grace to his own argument when he further states, “the science community stands by its science, particularly research following (M.E.) on from the IPCC’s fourth assessment report.” Hence the Australian climate community science is itself based on the rotten cornerstone of the IPCC’s discredited science.

One would have expected from an objective scientist that with the dark cloud of contradictions and antinomies that are hovering over the debate of climate change to have had at least a modicum of doubt about his position, instead of being a preacher of the Gospel of truth.

The Political Bankruptcy of The New York Times Punditry

I’m republishing the following for the readers of this new blog.

By Con George-Kotzabasis

Michael O’Hanlon along with his colleague Kenneth Pollack of the Brookings Institution, must be congratulated for their article in The New York Times which foreshadowed, after their visit in Iraq in the middle of 2007, that this might be a winnable war, brought the wrath of the Jupiterian New York Times liberal pundits to cast their bolts upon their heads for saying so.

But since the success of the surge—which I too adumbrated on December 2006 in an essay of mine titled “Blueprint for Victory In Iraq”, published in Australia on March 2007, would culminate in an American victory and make 2007 the Annus Mirabilis for president Bush—the liberal critics of the war like Frank Rich, Paul Krugman, and the vitriolic, but always charming, Maureen Dowd, not to mention others, have been stricken by Nemesis with the aphasia of muteness.  

 

American Liberals Scared by their Own Made Ghosts

By Con George-Kotzabasis

“Scariest stories ever written about contemporary America” is the story that makes some of the political toddlers of America to run and cover themselves under their bed sheets. Sans political wisdom, sans political and historical insight, and hence, sans cognitive and intellectual legitimacy, they attempt to analyse the world shaking event of 9/11 and the Administration’s protagonists’ response to the crescent shaped  bolt that appeared over the blue sky of America with their childish fears. And for fear to be effective it must have its bogey ghosts. So we have Cheney, Addington, and Bolton wrapped up with white sheets in the middle of the night scaring the bejeesus out of the liberal intelligentsia with their nefarious schemes of “a massive expansion of presidential power” starting an “illegitimate war,” creating “a system for spying on American citizens...sanctioned torture”, and “pushed official secrecy to unprecedented levels.” The critics of Cheney, Addington, and Bolton never learning the abc and never reaching the omega of statecraft are shocked to see, and it’s beyond their comprehension, that in moments of national crises the expansion and concentration of presidential power is the sine qua non of strong political leadership and a necessary but temporary measure to protect a nation from malicious lethal enemies, both external and internal.

All the above measures that Clemons highlights were instigated by the Vice President solely for the protection of America. It was an unenviable task and it could only be performed by the strong in character. One must not forget that in hard times only the hard men/women prevail. And Cheney, Addington, and Bolton will be panoramic figures in American history for their political and strategic insight, strength of character, and their indefatigable efforts to shield the United States and the West from the fanatical irreconcilable enemies of Islam.