Civilized Society's Greatest Enemy

What brought down the Roman Empire was simply debt burden. The leaders of the Roman Empire could not pay off their debts.

What brought down the British Empire was it's debts to America.

What brought down the German Empire was it's debts to France which led to the greatest recession the world has even known.

What is bringing down America is it's debt.

The writing is on the wall, you United States. Your civilization is doomed because you are so much in debt and you don't even change your ways.

Doomed, I say! Doomed!

http://www.nytimes.com/2010/08/22/business/22gret.html?src=me&ref=business

Will ye no think kindly on those who would be your friends! May the sun shine with your thoughts, today, and happiness grow in your heart! May you allow yourself some peace of mind.

Are Houses an Investment Any More?

Of course houses are an investment, but that the position of houses has fallen in the league table of investments should be looked on as a good thing. We don't want people and governments to use the housing market as a tool for economic growth because it's a very dangerous thing to do in the long term.

If governments such as those influenced by Bush and Brown use housing as a way to gain popularity and political muscle, they will again sow the seeds of financial disaster. The value of houses needs to grow in line with the ability of income growth to sustain mortgage payments that actually wind down individual debt over time. Thus, we can see that it is beneficial that within a lifetime a household pays off the mortgage.

It's very easy to raise house prices by artificially creating a market with excessive growth in money supply. One simply engineers a money based demand ahead of what would occur naturally over time with a moderate demographic expansion and normal growth of incomes. Moderate and normal can be estimated. We can all see when peoples purchases of property are pushed forward in time because they panic that they will not be able to afford a home. It is sheer nonsense that this should have happened in the United States and Britain. It is sheer economic incompetence! It is the fault of the FED and the Bank of England and other regulatory entities. Don't blame the banks. They always are predictable in their behavior. What happened was regulatory failure!

http://www.nytimes.com/2010/08/23/business/economy/23decline.html?src=me&ref=general

Will ye no think kindly on those who would be your friends! May the sun shine with your thoughts, today, and happiness grow in your heart! May you allow yourself some peace of mind.

The Benefits of Economic Growth Go Mainly to The Rich

That the benefits of economic growth favour the rich should not be a surprise to anyone. When the US and British governments save the banks, the main beneficiaries will be the richest in Britain and America.

Having said that one would think that it is a good idea to tax the rich very heavily and not worry too much about the growth consequences. After all if the rich benefit the most from growth why do you want to grow. It's not that the rich benefit the most it's that the rich benefit alone and the middle and lower people scarcely benefit at all.

In fact, it is probably the case that balancing the budget should be the very least that is achieved. Often by taxing the rich one creates scope for the nouveau rich, those who aspire to become rich but whose progress is hampered by very rich. The rich can slow down the rate of economic development, buy out promising technologies and close down competition. It's important thus to tax the rich the most, not just a little bit, but a lot!

What does the American economist Paul Krugman have to say about America's taxing of the rich?

http://www.nytimes.com/2010/08/23/opinion/23krugman.html?src=me&ref=general

Will ye no think kindly on those who would be your friends! May the sun shine with your thoughts, today, and happiness grow in your heart! May you allow yourself some peace of mind.

A Reader's Response to The Light and Suzi Malin's Artistic Future

My well versed reader of economics writes to me:

Suzi Malin has my sympathy if she indeed looses the light in her studio. I have, however, some difficulty in understanding why the light coming into her studio is so much superior to light in other locations. Maybe existing structures and buildings creat a special effect on the light falling into her studio. If that is the case, maybe she should pay the owners of these structures and buildings a fee for the service that she receives through the light bounces. Do not be angry at me, I am only trying the say that all situations have two sides. The school could refrain from its expansion plans or Suzi could move her studio to another location.

All over the world people are facing situations like Suzi's and most adjust to a new situation without complaining too much.

I myself together with six neighbours were apset about another neighbour who set up a small open saw mill among us. We complained to the authorities and even took a lawyer. We did not get anywhere and certaily did not get any compensation. I moved with my family as My daughter developed astma because of the sawdust that blew to our house.
L
Arthur, life is not fair and just because Suzi happens to be a known artist, why should she be given a special treatment. Let her fight her own fight and do not call the artists of the world to unite in her favour. Your call goes against my sense of fairness.

Dear Reader:

Thank you for your message and discussion of fairness! You obviously have a point about the way light behaves and I believe that the school does not provide secondary light other than what the students receive naturally from above.

My general point is that development is frequently negative and the costs are most frequently not quantified because economic science has no relationship to the real world other than through the price mechanism as exemplified by work of Stiglitz - micro and Friedman - macro.

Fairness represents a negotiated or mediated outcome between interested parties educated in the science of valuing externalities rather than a political process which relies on brute force. If the valuation of externalities were to become a proper economic science then I think real progress would be occurring in economic science.

Unfortunately, economics as developing cannot yet liberate itself from politics or the price mechanism.

Art can be much superior to economics because art can show the way.

Economics in my view has missed the point of engineering to make an environment cozy and loving instead of brutal and depersonalizing. It's not just education but education that is tolerant of art. Sure the kids of Camden who come from outside the locality will benefit, but it is local people who struggle to make a living in the here and now and for which the light is important to only a minority.

In the future, we will need to build churches, houses, educational centers and studios that meet environmental energy saving standards because the old standards have failed us miserably. We have no real pressure to art and quality. Our buildings are based on the profit motive rather than design for excellence and the technical arts. We leave out the values of the past and and future in an obsession with how the present fabric of our efforts can pay for themselves in the shortest space of time.

Proper respect for light is import and we don't appreciate how much dimming the light or shaping it through vegetation and tree canopy can improve our lives.

Can you think of a fair resolution of the conflict between art studio formally Quaker Meeting Hall and school development?

I think Suzi's artistic solution is the best, which is to design the school extension in such a way that it sets an example to the students of the best in cooperation and art and education. We should retain the canopy of trees and diffused light and let our kids explore natural phenomenon, which is why place matters so much in education. Putting kids through school in the concrete city jungle is not optimal!

Design and art, design and education, design and cooperation!!

Words an economist would rarely utter!

Will ye no think kindly on those who would be your friends! May the sun shine with your thoughts, today, and happiness grow in your heart! May you allow yourself some peace of mind.