Friday, May 18, 2018

Lenin's "inflation & taxation grinding" quote?.



Fake Quote Files: V.I. Lenin on Inflation and Taxation



Beware the well-armed Marxist.
Beware the well-armed Marxist.

http://blog.skepticallibertarian.com/2013/04/15/fake-quote-files-v-i-lenin-on-inflation-and-taxation/


It occurred to me, while researching alleged quotations from historical figures, that for every time someone cites a source for a quote, there are about 10,000 instances where people simply stick the purported author’s name under it with an emdash (—), as though it was a sufficient reference.
This is quite maddening, because even if a quote is accurate, you must wade through thousands of blogs, books, and pamphlets (all with slightly different versions) before you find someone who bothered to cite a source. When a source is given, it is usually a fairly simple matter to look up the referenced work and check if it is in there. When no source is forthcoming, the quote is probably fake, but it’s not possible to definitively prove that without a lot of research.
This leads to my contribution to the List of Things People on the Internet Need to Understand:
#6,879. Sticking someone’s name after a quotation is not a source. It’s an attribution. An attribution is the claim that needs verification. A source is a document written by the alleged author, or recorded by a credible contemporary witness, that contains the relevant passage.
For instance, this quote by V.I. Lenin is wildly popular and has been repeated countless times in blogs, newspaper articles, and books, going back to the pre-internet era.
“The way to crush the bourgeoisie is to grind them down between the millstones of taxation and inflation.”
— Vladimir Ilyich Lenin
(See? The longer dash makes it look much more credible.) This quote has a very long and fairly involved history, with ancestors as old as the 19th century. Thanks to the miracle of digital archives we can mark its entire evolution through transitional fossils, frozen in print:
  • 1997: The first instance of this version in print (that I can find) is in a paper on (of all things) taxes in Bangladesh. It cites no source.
  • 1988: A letter in The Bulletin (with Newsweek) had “middle class” instead of “bourgeoisie”: “Lenin stated that ‘the way to crush the middle-class is to grind them between the millstones of taxation and inflation‘, and that is exactly what is happening …”
  • 1986: An issue of Books and Bookmen makes reference to a different variation of it: “Lenin threatened to grind the middle-classes between the upper mill-stone of taxation and the nether mill-stone of inflation; but Lloyd George did so as well.”
  • 1984: A column in The Advocate attributed a version of it to Karl Marx: “One perhaps should remember that Carl [sic] Marx said ‘if you wish to destroy the middle class, then you grind it between the twin millstones of taxation and inflation.'”
  • 1974: In what probably marks the earliest embryo of the quote’s attribution to Lenin, Ronald Reagan remarked in a speech near the end of his term as governor of California: “Make no mistake about it: inflation is a tax and not by accident. Lenin once said, ‘Through inflation government can quietly and unobservedly confiscate the prosperity of its citizens.'”
  • 1961: Another probable ancestor of the quote comes from the November 1961 edition of The Freeman, which featured an essay by John Chamberlain containing this unattributed statement: “During the past generation the ‘middle condition of man’ has been ground between the upper and nether millstones of inflation and steeply rising progressive tax rates.”
  • 1956: An article about middle incomes in the Economist may have been the original source for the symbolism later used by others: “These incomes are truly caught between the upper millstone of steeply progressive taxation and the nether millstone of inflation.”
But where did this quote originate from? Did Lenin really say this? A search of Lenin’s Collected Works doesn’t reveal anything similar to it, and no version of it I’ve found has an original source.

Though it may come as a surprise to many libertarians, Keynes understood all too well the dangers of inflation.
Though it may come as a surprise to many libertarians, Keynes understood all too well the dangers of inflation.

If Lenin didn’t say this, how did it start? Was it misattribution, mistranslation, misunderstanding, bad paraphrasing, or deliberate forgery? Frequently, answers are lost to the mists of time, but fortunately in this case, we may be able to trace it all the way back to its probable origin: John Maynard Keynes.
Although it is now overshadowed by his later work, Keynes wrote a brilliant and enduring book in 1919, in the aftermath World War I, titled The Economic Consequences of the Peace. In it, he states:
Lenin is said to have declared that the best way to destroy the Capitalist System was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens.
… Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.
Given the unambiguous parallels between this passage and Ronald Reagan’s quote, it seems Reagan read Lord Keynes (or at least, read someone who had read him), and somewhere between 1919 and 1974, what Keynes interprets Lenin as saying became a direct quote fromLenin, which was later embellished and merged with other powerful imagery about inflation and taxes circulating at the same time (grinding millstones crushing the middle class and the bourgeoisie).
But did the Soviet despot actually say what Keynes thought he did, regarding the “debauching of the currency”? Not exactly. In an article in the Journal of Economic Perspectives, Michael V. White and Kurt Schuler extensively researched the question, and discovered that Keynes had based his commentary in Economic Consequences on the report of an interview with Lenin published in the Daily Chronicle and the New York Times on April 23, 1919. From an unnamed source, the report quotes Lenin at length:
Hundreds of thousands of rouble notes are being issued daily by our treasury. This is done, not in order to fill the coffers of the State with practically worthless paper, but with the deliberate intention of destroying the value of money as a means of payment. …
Experience has taught us it is impossible to root out the evils of capitalism merely by confiscation and expropriation… The simplest way to exterminate the very spirit of capitalism is therefore to flood the country with notes of a high face-value without financial guarantees of any sort. …[T]he great illusion of the value and power of money, on which the capitalist state is based will have been definitely destroyed.

Russia suffered hyperinflation after World War I as a result of massive money printing by the Bolshevik regime. It reached 245% by 1924.

While there are grounds to doubt the veracity of this report, given its anonymous origin, historian E.H. Carr gives us some reason to think it could be plausible: “None of the Bolsheviks wanted, or planned, inflation. But, when that happened (since the printing press was their main source of revenue) they rationalized it ex post facto by describing it as (a) death to the capitalists and (b) a foretaste of the moneyless Communist Society. Talk of this kind was widely current in Moscow in 1919 and 1920.”
Lenin, in fact, read Economic Consequences, and in a July 1920 speech to the Comintern, approvingly cited Keynes’ criticism of European governments as evidence the capitalist states were on the verge of collapse. While he dismissed Keynes’ condemnation of him and the Communists as “the conclusions of a well-known bourgeois and and implacable enemy of Bolshevism,” Lenin never explicitly denies anything Keynes’ attributes to him in the book.
So Keynes’ commentary on Lenin was not made up, but based on a widely circulated interview in the mainstream press, which in retrospect seems of dubious origin, but is at least compatible with the statements coming out of Moscow around that time.  However, later paraphrases of Keynes given as direct quotes from Lenin, like Reagan’s and all of its descendants, are almost certainly false.

The found of Georgism.

A final note, regarding the origins of the “crushing/grinding millstones” metaphor (which seems to be a perpetual threat to reading audiences, as much as to the middle class): this phrasing appears to have originated in Henry George’s 1879 book Progress and Poverty. The namesake of Georgism wrote,
Private ownership of land is the nether mill-stone. Material progress is the upper mill-stone. Between them, with an increasing pressure, the working classes are being ground.
With its attack on private land ownership and material progress in the name of the working class, this certainly would sound very Marxist to a modern ear, but in fact, Marx and George were bitter enemies, and Marx probably would have been outraged to see his name attached to George’s words. Perhaps that irony makes it all worth it.
Thus, the phylogenetic family tree of a fake quotation is fully mapped. Keynes’ commentary on Lenin is hammered into a direct quote from Lenin, propagated by Ronald Reagan, which then merged (with all the promiscuity that unsourced quotes are infamous for) with a popular quote by free marketers about the millstones of inflation and taxation (itself a derivative of a quote from Henry George). Forgery makes strange bedfellows.



Saturday, May 12, 2018

The Mind has Mountains

'No worst, there is none. Pitched past pitch of grief.' 

No worst, there is none. Pitched past pitch of grief, 
More pangs will, schooled at forepangs, wilder wring. 
Comforter, where, where is your comforting? 
Mary, mother of us, where is your relief? 
My cries heave, herds-long; huddle in a main, a chief 
Woe, wórld-sorrow; on an áge-old anvil wince and sing — 
Then lull, then leave off. Fury had shrieked 'No ling- 
ering! Let me be fell: force I must be brief."'

    O the mind, mind has mountains; cliffs of fall 
Frightful, sheer, no-man-fathomed. Hold them cheap 
May who ne'er hung there. Nor does long our small 
Durance deal with that steep or deep. Here! creep, 
Wretch, under a comfort serves in a whirlwind: all 
Life death does end and each day dies with sleep. 

The Mind Has Mountains: Reflections on Society and Psychiatry 1st Edition

Friday, May 11, 2018

Finland's Universal Basic Income Stopped

Finland’s Universal Basic Income experiment falls flat

25 April 2018
12:00 PM
https://blogs.spectator.co.uk/2018/04/finlands-universal-basic-income-experiment-falls-flat/


Should governments abolish their welfare states and replace them with a Universal Basic Income (UBI), paid to everyone, even billionaires, regardless of means? Such payments would be designed to cover essential living costs, leaving individuals free to make the choice of whether they wished to work in order to gain themselves a better lifestyle.
It is an idea which until yesterday seemed to be in the ascendant. Bernie Sanders has advocated it. John McDonnell has launched a study to determine whether it should become Labour policy. It hasn’t just attracted the Left – Elon Musk and Mark Zuckerberg have declared themselves in favour, seeing a UBI as a means of softening the mass job losses they expect as a result of technological advance. It has attracted some British Conservatives, too – Alan Duncan wrote a book advocating it as long ago as the 1990s.
One country even put the idea into practice – Finland. In 2016, 2000 unemployed Finns were put onto a trial of UBI in which they were paid 560 Euros (£490) a month, with no strings attached. They didn’t have to prove they were looking for work, and if they did find work they were allowed to carry on receiving the money.
Yesterday, however, the experiment came to a shuddering halt. The Finnish government announced that it is not going to extend the scheme. In a blow which will be felt especially by the British Labour party, it announced that it was instead looking at a welfare system based on Britain’s Universal Credit – which to McDonnell and others has become a byword for social injustice.
So what went wrong with the dream? The Finns have abandoned the experiment simply out of cost. It is extraordinarily expensive to start paying a living wage to the entire populace, and would require a huge rise in taxes to fund it. Notionally, this does not matter too much, as for most people the extra taxes would be offset by the income itself – why should a worker on an average wage mind paying an extra couple of hundred pounds a week in tax if they are receiving the same sum back in UBI? But there is a very big snag. Jack up taxes and you hugely increase the incentive to avoid, or even to evade, it. There are inevitably going to be people who will gladly accept their free handout at the same time as dreaming up wheezes to reduce their tax bill. Any government experimenting with UBI is likely to find itself falling short of revenue to pay its massive extra outgoings.
The higher the UBI, the bigger the problems. Finland has run into difficulties trialling a UBI of less than £500 a week. That would not even nearly cover living costs in Britain. A UK government might instead want to set its UBI at £323 per week – the amount earned by an individual working 37 hours a week at £8.75 an hour, which is the ‘real living wage’ as defined by the Living Wage Foundation. But paying that sum to every adult in Britain would cost £853 billion. True, you could then cut out the £160 billion a year the government spends on pensions and much of the £114 billion it spends on welfare. But still the extra public spending required to support UBI at this level would come to £579 billion – raising current UK public spending (£772 billion) by three quarters. I wouldn’t envy a Chancellor the task of bringing in this extra revenue, even if he was promising everyone a ‘free’ income of £323 a week.
The above assumes there would be no effect on inflation, but of course putting £323 a week into the pockets of the low-paid would inevitably have an impact on prices. Suddenly, £323 a week would no longer seem enough. Moreover, there are people who already receive more than £323 a week in benefits. Would they see their income slashed in order to pay that weekly sum to billionaires? The rollout of Universal Credit may have had teething problems, but they are nothing compared with the lacerated gums which would come with a Universal Basic Income

Germany's green targets.

German CO2 Reduction Targets “Completely Illusionary,” Comments German National Daily

Game over for green energies and CO2 reductions?

Journalist Daniel Wetzel of German national daily Die Welt here presents a devastating commentary on Paris Accord and Germany’s so far “illusionary” CO2 reductions targets. The German failure is a signal that could have significant global consequences.

Wetzel not only calls the targets illusionary, he also believes the existing Energiewende (transition to green energies) is “at an end”.

2030 target completely illusionary

According to Wetzel, “The Energiewende and climate change are not among the priorities of the government” and that Germany reaching its self-imposed targets is achievable only if “everyone were forced to switch off every boiler, oven, motor. Completely illusionary.”

Lots of talk, no action

While German political leaders like to continue pretending they are taking real action to combat climate change, the reality is that the German government has been rolling back subsidies for green energies such as wind and sun over the past years. And many localities have made the permitting of wind parks far more stringent.
The days of unfettered support for green energies are over.
Treibhausgasemissionen in Deutschland von 1990 bis 2017 in Millionen Tonnen CO2-Equivalent
Germany’s CO2 equivalent greenhouse gas emissions in millions of tonnes (Source: UBA Federal Office of Environment)
The result: Germany has not reduced its CO2 equivalent emissions for close to a decade (see chart above). Wetzel writes that everyone agrees that it is unrealistic to think that Germany will somehow make the sudden downward trend turn.

German Energiewende “at the end”

The Die Welt journalist adds: “Practically all renowned environmental analysts and government experts have already determined that the German Energiewende structurally has reached the end and that a system change is needed.”

Humans burning fuel one million years

In his commentary Wetzel also reminds that humans have been using fire for some one million years, and that it cannot be expected that they will just stop doing so during the course of one single generation.
Wetzel compares the Energiewende to the Apollo space program, which put man on the moon after 12 years and 120 billion dollars of investment. He notes that compared to the great transformation which Energiewende would entail, this was peanuts.
He warns that implementing the Energiewendecould cost the country a back-breaking three trillion euros (without mentioning the impact on climate would be negligible) and doubts the public would ever accept such a large-scale, draconian transformation of society.

German credibility takes a blow

Wetzel also comments the Germany’s failure to make the 2020 targets has tarnished the country’s image as a leader in climate protection, and adds: “The coalition agreement and the German Federal Budget for 2018 robbed all remaining credibility.”
In short Germany’s is not serious about reducing CO2.
Environmental groups and the Potsdam Institute, for example, are fuming, yet keep insisting it’s still not too late and achieving the target is still possible. But Wetzel injects sobriety and realism: “In the meantime we know that Germany will not only fail resoundingly to meet its self-imposed 2020 targets, but also those of the EU itself.”
With Germany as Europe’s largest economy, and regarded as a role model for all things green, the country’s failure would send a devastating message to the rest of the continent and the world: The Green Revolution was mostly a dream and was in fact never attainable. If tech-savvy Germany can’t do it, who can?

“No reality basis”

Yet, German officials continue to insist they can meet the 2030 target! But Die Welt’s Wetzel notes that doing so would mean Germany cutting it’s CO2 equivalent emissions by some 40%, or 350 million tonnes, within the next 12 years. That would mean radical and painful transformations. Recall that Germany has not managed to emissions at over the past decade (see chart above). Wetzel asks: “How credible is this target?
Die Welt’s Wetzel summarizes:
The feasibility rhetoric of policymakers as a rule has no reality basis.”
Finally, he reminds that Germany going it alone will never work, and that climate protection has to be “organized internationally – or not at all”...
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I liked the below paragraph from the German article, as the author puts his finger on a remarkable feature of the Energiewende that the German population is surprisingly insensitive to:
“Obwohl sich die utopischen Annahmen zur Zielerreichung Jahr für Jahr in Luft auflösten, gab es keine Nachsteuerung, kein Controlling. Über eine ganze Dekade hinweg erfolgte keine Revision der Aufgabenstellung, keine Überprüfung der Prämissen …”
My rough translation:
“Even though the assumptions underlying the feasibility of the Energiewende evaporated year after year, no corrections were made, and there was no controlling. During the course of a decade no efforts were made to revise the definition of the project and reexamine the project’s premisses …”
Frightening this is: reason suspended, a religious mania, a paroxysm reminiscent in its bumbling way of Hitler’s erratic conduct of war.
What I find most worrisome is the absence (until recently) of open controversy and political opposition concerning the Energiewende. It is almost as if (many) Germans are glad to have found a higher cause that entitles them to sideline pesky democracy.
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That part reminded me of the Soviet Union, where they pretended everything was working just fine, and that little things could just be ignored. However, everyone knew nothing was working, but no one dared or was willing to admit it
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I can see your point. Mind you, the average German doesn’t seem to have matured yet to the point where he understands that the system doesn’t work.
Also, what the above quote points to is that pluralism is critically diminished and democracy isn’t working as it should. It’s a dangerous indicator that irrationality, a religious mania, if you like, prevails.
In a functioning democracy such blatant contradictions and absurd errors as accompany the Energiewende are quickly picked out and fiercely challenged.
It is not a good sign that this isn’t happening in Germany.