Commentary on Political Economy

Tuesday 18 October 2011

Gideon (Idiot) Rachman's Bible - From the FT with Dementia

For those friends arriving from Rachman's Column, here are the references: (Magnus on The China Syndrome)
Beijing has to rebalance its investment-centric, credit-hungry economic model to one built round household consumption. But this is complex. It involves a redistribution of income from capital and profits to labour and wages; radical changes in the role of the exchange rate, interest rates and capital markets; and strategies to counter the high propensity to save by households, corporates and central government. It is also politically divisive because power and economic privilege have to be wrested from party elites, state enterprises and banks, and given to new beneficiaries such as private companies, households, college graduates and rural migrant workers, the last of which has become increasingly restive.

We are dealing with the "theoretical" matters here. As you can see, once "economic science" turns into "experimentation" exercised on human beings and societies, the result can only be that "competition" becomes the utter denigration and "annihilation" of being human. This is a quotation from the director of the Chinese dictatorship's sovereign wealth fund that speaks for itself:

Jin was unusually candid about what ails Europe and urged leaders to have the "guts" to make significant reforms - as Asian leaders did when faced with their crisis in the late 1990s.
"The root cause of the trouble is the overburdened welfare ... the sloth-inducing, indolence-inducing labor laws," he said. "People need to work harder. They need to work longer."

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