This week, I have been mostly reading:

• Public R&D austerity spending cuts undermine our grandchildren’s future - Bill Mitchell: In this period of fiscal austerity with suppressed overall growth rates and labour market deregulation that undermines working conditions and reduces the incentives to invest in best-practice technology labour productivity is falling – as will living standards in the coming years. The world is locked into an idiotic race-to-the-bottom. It is a curious period really. The hypocrisy of governments, aided and abetted by the right-wing think tanks, who claim they are cutting into public spending to reduce the drain on living standards of our children and grandchildren, is clear to see. What they are really doing is undermining the future prosperity of the next several generations at the same time that they push millions into unemployment and poverty now. Why are we so stupid that we tolerate this nonsense?
• Higher Education: Capitalism At Its Most Despicable - Paul Buchheit at Common Dreams: The state of higher-ed teaching in America: Years of study by trusting young scholars who end up with academic positions that pay as much as entry-level fast food jobs. Adjuncts made up less than 1/4 of instructional staff in 1969, but now make up over 3/4 of instructors. They make a median wage of about $2,700 per course, with little or no benefits.
• Central bankers and their irrational fear - Simon Wren-Lewis: A key feature of deficit fetishism is a concern about deficits in the short term. Politicians seem happy to take measures that cut deficits in the short term even if debt becomes higher in the longer term. Indeed the analysis presented by DeLong and Summers argues that hysteresis forces would not have to be that large before austerity would raise long run debt to GDP levels. We also know that deficit fetishism is specific to increases in debt caused by recessions: over the longer run if anything deficit bias implies rising rather than falling levels of government debt. So any form of fiscal stimulus that avoided an increase in debt in the short run but not in the long run would avoid deficit fetishism. That is what a money financed fiscal stimulus aka helicopter money aka People’s QE could do.
• What Clinton Got Wrong About Snowden - John Kiriakou, who knows a thing or two about whistleblowing, at OtherWords: I’m disappointed, frankly, that somebody running for president of the United States doesn’t know that the Whistleblower Protection Act exempts national security whistleblowers. There are no protections for you if you work for the CIA, NSA, or other federal intelligence agencies — or serve them as a contractor. You take a grave personal risk if you decide to report wrongdoing, and there’s nobody who can protect you.
• Corbyn in the Media - Paul Myerscough in the London Review of Books: The party members who voted for Corbyn hadn’t suddenly thrown their toys out of the pram just because Miliband lost. This is not a story of the last five years, but the last twenty, and their disillusionment with New Labour is about a great deal more than the Iraq War. For them, Miliband was not ‘too left-wing’; on the contrary, he was a final attempt at compromise. And when it failed, they realised they had had enough. It was too difficult to go on knocking on doors, summoning the necessary conviction, working towards the slim possibility of victory in the hope of implementing a platform of ever-weakening amelioration of the worst effects of neoliberalism. They looked at the candidates on offer, and saw that they had nothing left to lose.
• On Corbyn and our collapsing orthodoxies - Matthew Richmond, openDemocracy: George Osborne’s supposed “pitch to Labour voters” at the same time as slashing the tax credits of the hard-working families he claims to be so fond of, was “clever politics”. The message is clear: it doesn’t matter that Osborne is pushing through an extreme policy that will make millions of working people dramatically poorer, the simple fact that he declares himself to be on the centre ground automatically makes it so. Or to put it another way, if you brazenly lie you deserve to be taken seriously. Those are the rules. Like it or lump it.
• Attacks on Sanders, Progressives Falsely Depict Obama As Lefty Failure as Opposed to Neoliberal Success - Yves Smith, Naked Capitalism: In other words, any time anyone tries to present Obama as having failed to implement a “liberal” agenda because the right was too powerful is either an apologist or ignorant. Obama has achieved precisely what he intended to achieve, which was to implement center-right economic policies with tepid social justice measures to divert attention from how he was serving the interests of the 1% and even more so, the 0.1%. And the fact that his allies in Congress have in large measure been voted out of office, that Sanders is going from strength to strength despite his lack of big corporate support, and that the neoliberal diehard Clinton is being forced to feint to the left are signs that the political tectonic plates are shifting. Much more is possible now than was six years ago.
• Neo-liberal myths constrain our understanding of poverty - Bill Mitchell: A currency-issuing government can always do that and should net spend so that all the idle resources (particularly labour) are productively employed. The solution to poverty is not complex. It is about a lack of income. That is often due to unemployment and insufficient wages (working poor). By ensuring there are enough jobs for all – and maintaining that continuity across the private spending cycle by introducing a – Job Guarantee – a national government can use its fiscal capacity (driven by the fact it issues its own currency) to reduce poverty and income inequality while sustaining economic growth.
• Free College vs. Cost-benefit Thinking - Elizabeth Popp Berman at orgtheory.net: So I support the free college movement. But I’d like to see its champions stop saying it’s because we need to be globally competitive, or because it’s got a huge ROI. Instead, say it’s because our society will be stronger when more of us are better educated. Say that knowing higher education is an option, and an option you don’t have to mortgage your future for, will improve our quality of life. Say that colleges themselves will be better when they return to seeing students as students, and not as revenue streams.
• Union power and inequality - Florence Jaumotte and Carolina Osorio Buitron of the Research Department, IMF in VOX. Captain Obvious is uncredited: If our findings are interpreted as causal, higher unionisation and minimum wages can help reduce inequality.
• Eurozone crosses Rubicon as Portugal's anti-euro Left banned from power - Ambrose Evans-Pritchard in The F**king Telegraph, of all places: S**t is f**ked up and bulls**t. End of history, my arse. Europe’s socialists face a dilemma. They are at last waking up to the unpleasant truth that monetary union is an authoritarian Right-wing enterprise that has slipped its democratic leash, yet if they act on this insight in any way they risk being prevented from taking power.
• Original Sin and Global Stagnation - Paul Krugman, NYT: […] emerging markets still suffer to some extent from original sin — underdeveloped capital markets and a tendency to borrow in foreign currency. This sin isn’t nearly as strong as it was 15 years ago, when Barry Eichengreen and Ricardo Haussman coined the term, but corporate dollar-denominated borrowing after 2008 brought it partially back. […] Oh, and a US interest rate hike, which would not just hit the US economy but also, via a stronger dollar, hit the emerging markets via balance sheets, would do a lot to make things even worse.
• Central Banks Are Not Agricultural Marketing Boards: Depression Economics, Inflation Economics and the Unsustainability of Friedmanism - Brad DeLong, Washington Center for Equitable Growth: Milton Friedman was very clear that economies could either have too much money (Inflation Economics) or too little money (Depression Economics)–and that a central bank was needed to try to hit the sweet spot. He hoped that hitting the sweet spot could be made into a somewhat automatic rule-controlled process, but he was wrong.
• I get what you get in ten years, in two days - Noah Smith: The usual economist case for income redistribution is based on utilitarianism; the idea is that $1000 matters more to a poor person than to a rich person. [Greg] Mankiw wants to ditch this idea in favor of a value system based on "just deserts".
• We need to stop Australia’s genetic heritage from being taken overseas - Steve Wylie, The Conversation: Oh, so much wrong in such a small article. Australia’s scientists should be mining Australia’s gene bank, and all Australians should benefit from the rewards of this intellectual property (IP). International collaboration is the lifeblood of scientific advancement, but so is competition and protecting IP. When Australia’s genetic heritage is lodged in other countries, we have lost control of our IP.
• Obfuscation: how leaving a trail of confusion can beat online surveillance - Julia Powles at The Guardian reviews Obfuscation: A User’s Guide for Privacy and Protest by Finn Brunton and Helen Nissenbaum: More than 30 colourful examples – instructive vignettes in their own right – are used to build the case. Roughly a third are analogue, and the images stick. […] Iconic movie scenes, like the switching briefcases in The Thomas Crown Affair, or the powerful “I am Spartacus” moment in Kubrick’s 1960 epic. The authors bring in orb-making spiders, sim-card shuffles, loyalty-card swap meets, “babble tapes” (a digital file played in the background of a conversation in order to obscure it) – all examples where the individual merges with the tribe; where false signals muddy the genuine; where noise and quick feet offer “weapons of the weak”.
• Secret source code pronounces you guilty as charged - David Kravets at Ars Technica: The results from a Pennsylvania company's TrueAllele DNA testing software have been used in roughly 200 criminal cases, from California to Florida, helping put murderers and rapists in prison. Criminal defense lawyers, however, want to know whether it's junk science. Defense attorneys have routinely asked, and have been denied, access to examine the software's 170,000 lines of source code in a bid to challenge the authenticity of its conclusions. The courts generally have agreed with Cybergenetics, the company behind TrueAllele, that an independent examination of the code is unwarranted, that the code is a proprietary trade secret, and disclosing it could destroy the company financially.
• Why An Open-Access Publishing Cooperative Can Work: A Proposal for the AAA’s Journal Portfolio - Alberto Corsín Jiménez, John Willinsky, Dominic Boyer, Giovanni da Col and Alex Golub in Cultural Anthropology: Will [American Anthropological Association (AAA)] publications spend yet another decade locked within a publisher website where only research libraries can afford to purchase them? Or can our scholarly work join the growing body of research that is publicly available and accessible as a public good? In this piece we propose a concrete, practical, and financially sustainable way that the AAA can make its publishing program open-access: a cooperative model of scholarly publishing. This tailor-made design will cost the AAA nothing, while giving the organization a chance to be at the forefront of global innovation in scholarly communication.
• What is a knowledge city? - Nicholas Gruen: We have before us an astonishing new set of technologies which are transforming our lives. Thinking of how we convert them into jobs is a little like welcoming the invention of printing by asking “How many printing jobs can we attract to our city/country”. See also this on how the public are still being ripped off by publishers, it being "hard not to conclude that South Africans will in future be paying far more for knowledge – and will have even less access to it."
• Marx's relevance today - Chris Dillow: Marx asked, and answered, a fundamental question: what is the point of economic life? For him, it was to increase real freedom and self-realization. Capitalism, he said, doesn't do this but instead alienates us.
• The Rise and Fall of For-Profit Schools - James Surowiecki, The New Yorker: Students at for-profit schools are able to borrow huge sums of money because the government does not take creditworthiness into account when making most student loans. The goal is noble: everyone should be able to go to college. The result, though, is that too many people end up with debts they cannot repay. Seen this way, the students at for-profit schools look a lot like the homeowners during the housing bubble. In both cases, powerful ideological forces pushed people to borrow (“Homeownership is the path to wealth”; “Education is the key to the future”). In both cases, credit was cheap and easy to come by. And in both cases the people pushing the loans (mortgage brokers and for-profit schools) didn’t have to worry about whether those loans were reasonable, since they got paid regardless.
• The British Tax Credits system is a sign of New Labour failure - Bill Mitchell: I consider that no worker should be paid below what is considered the lowest tolerable material standard of living just because some low wage-low productivity operator wants to produce in a country and make ‘cheap’ profits. I don’t consider that the private ‘market’ is an arbiter of the values that a society should aspire to or maintain. That is where I differ significantly from my profession. The employers always want the wages system to be totally deregulated so that the ‘market can work’ without fetters. This will apparently tell us what workers are ‘worth’. The problem is that the so-called ‘market” in its pure conceptual form is an amoral, ahistorical construct and cannot project the societal values that bind communities and peoples to higher order considerations. The minimum wage is a values-based concept and should not be determined by a market.
• Avoiding the Financial Resource Curse - Noah Smith at Bloomberg View: There is something unsettling about watching the financial sector become a bigger and bigger part of what people do for a living. After all, finance is all about allocation of resources -- pushing asset prices toward their correct value so businesses can know what projects to invest in. But when a huge percent of a country’s effort and capital are put into finance, there are less and less resources to reallocate. We can’t all get rich trading houses and bonds back and forth.