The Great Debate UK

from The Great Debate:

Sympathy for the Plutocrat

This is a response to an excerpt from Chrystia Freeland’s Plutocrats: The Rise of the New Global Super-Rich and the Fall of Everyone Else, published this week by Penguin Press.

It’s great to be what you people are now calling a plutocrat.  I know.  I am one.

We plutocrats live incredible lives, surrounded by luxury and insulated from risk and discomfort.  Things have gone very well for us over the last several years.  Since George Bush left office, the stock market has doubled, we got a (sweet!) $700 billion rescue of the financial system, and corporate profits are at a 50-year high.  BOOYA!

The growing economic distance between people like me and the little people like you hasn’t been this great in a long, long time.  You may call that inequality.  We call it freedom.  But if things are going to continue to go this well, you people need to get with the program.  Here, I’d like to have a frank discussion about that.

from The Great Debate:

Why G-Zero is a good thing

This is the second in a series of responses to Ian Bremmer’s excerpt of Every Nation for Itself: Winners and Losers in a G-Zero World. The first response can be read here.

It’s said that predictions are risky business, especially those about the future. No one knows that better than Ian Bremmer, who in addition to his multiple books has created one of the more successful risk analysis organizations. Being in the business of highlighting risks, he has for the past few years focused on the breakdown of the world order most of us grew up with, whether a 20th century world of great-power struggles or an early 21st century world of American economic and military preponderance. Now, says Bremmer, those systems are finished and in their stead we have... nothing.

from The Great Debate:

Should economists be “imagineers” of our future?

By Mark Thoma
The opinions expressed are his own.

This essay is a response to Roger Martin's "The limits of the scientific method in economics and the world" (part one and part two), recently published on Retuers.com.

Roger Martin is unhappy with the state of economics. One charge is that:

[an economist] predicts a future that is based on the past.  And when it is anything but, he returns to the same tools to do it again, believing that in doing so he is being meritoriously scientific. ... Extrapolating the future to be a straight-line projection of the past is neither accurate, nor is it helpful in creating better understanding and newer ideas.

from The Great Debate:

The limits of the scientific method in economics and the world

By Roger Martin
The opinions expressed are his own.

This is part one of this essay. Read part two here.

As the economy teeters and the capital markets gyrate, I can’t get out of my mind the evening of May 19, 2009.  We were near the stock market nadir and fears were cresting that we were heading straight into the next Great Depression. I was invited to a dinner along with half a dozen tables of guests to hear a very prominent macroeconomist opine on the state of the economy and the path to recovery.

The economist held forth with a detailed, analytical account of what had caused the economic meltdown in the second half of 2008 and the path that he predicted recovery would take. I was struck by how scientific he was, spewing myriad statistics, employing technical terms by the boatload, and praising his econometric model. It was ‘very sophisticated’.  Given the nods and encouraged looks in the room, it seemed as though he had provided great comfort to the guests; they could go to bed confident that thanks to his science, they could trust that this man knew where we were headed.

from The Great Debate:

Don’t overestimate Afghanistan pessimism

This is a response to Rory Stewart’s book excerpt “My uphill battle against the Afghanistan intervention.” David Rohde’s response can be read here and Anne-Marie Slaughter's response can be read here.

By James Dobbins
The views expressed are his own.

Rory Stewart maintains that it is “not simply difficult, but impossible” to build an Afghan state. Presumably, this is meant hyperbolically, since Afghanistan has been recognized as an independent state far longer than any of its northern or southern neighbors.

from The Great Debate:

My uphill battle against the Afghanistan intervention

By Rory Stewart
The views expressed are his own.

I returned to Afghanistan (after spending a short time at Harvard) in 2005. And when I heard that the British government was about to send three thousand soldiers into Helmand, I was confident that there would soon be a widespread insurgency. I also predicted that the military would demand more troops, and would get dragged ever deeper.

It wasn’t that I had any particular skill in predicting the future. I failed to predict that Egypt’s President Hosni Mubarak would fall. I was wrong about Iraq. And my prediction for Helmand wasn’t based on any knowledge of Helmand. It was simply that I recognized the mindset and the actions of the NATO governments from Iraq. And I wasn’t alone in warning against the deployment. Many others predicted the same thing in Helmand. A military friend of mine had returned from a reconnaissance trip saying, “There isn’t an insurgency, but you can have one if you want one.” The Helmand surge continued regardless. The British government seemed to have a momentum, quite distinct from any individual politician or policy-maker. Troops were increased from two hundred U.S. Special Forces in 2005 to three thousand British soldiers in 2006.

from The Great Debate:

Washington’s next challenge

By James Pethokoukis
The opinions expressed are his own.

Reuters invited leading economists to reply to Larry Summers' ope-d on his reaction to the debt ceiling deal. We will be publishing the responses here. Below is Reuters Breakingviews columnist James Pethokoukis’ reply. Here are responses from Laura Tyson, James Hamilton, Robert Frank, Russ Roberts, Benn Steil and Donald Boudreaux as well.

Like Larry Summers, I have a “multifaceted reaction” to Washington's debt ceiling and budget deal. In fact, I have the exact same multifaceted reaction, except driven by completely different rationales.

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