Smart Links 20 October 2012

Commentary on Sweden's journey to balance, one paving stone on the path to social mobility, the unintended consequences of ultra-easy monetary policy, growth isn’t finished, the US needs to fix its finances, and another kick at Canadian democracy.

Balancing fair government and the economy in Sweden.

Economist -- The new model
A bit more unequal, a lot more efficient.

The UK’s education maintenance allowance.

Guardian -- Higher education: smoothing the path
Alan Milburn's report on social mobility shows why scrapping the education maintenance allowance was a disaster.

William R. White’s fears of what happens when interest rates are too low for too long. Thanks to Pete of Toronto.

Pdf Below -- Ultra Easy Monetary Policy and the Law of Unintended Consequences

To quote.

“They create malinvestments in the real economy, threaten the health of financial institutions and the functioning of financial markets, constrain the “independent “ pursuit of price stability by central banks, encourage governments to refrain from confronting sovereign debt problems in a timely way, and redistribute income and wealth in a highly regressive fashion.”

Related -- National Post -- The malinvestment crisis

Waiting for the next shot of innovation.

Charlie Fell -- Is Growth Over?
The U.S. economy is currently experiencing the most lacklustre recovery of modern times, and only the brave or misguided could possibly envisage any significant improvement in the near future.

Job one, fix the fiscal mess.

Financial Times -- Learn the Cuba lesson and seize initiative
Fifty years on from the Cuban missile crisis, a simple lesson of that period is often overlooked. The crisis was driven by the side that had the strategic initiative.

Democracy it ain’t.

Toronto Star -- Tim Harper: The omnibus bill becomes business as usual for Conservatives
Son of Omnibus may have been assembled in the secret Conservative laboratory of dark arts hidden away in the depths of the capital-area woods.

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Ultra Easy Monetary Policy and the Law of Unintended Consequences.pdf426.14 KB
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Twin Virtues: Inequality of Outcomes & Equality of Opportunity©

Twin Virtues

Ultimately, the most successful societies find the balance between the twin virtues of inequality of outcomes and equality of opportunity.

The new politics must marry the twin virtues of unequal outcomes and equality of opportunity.

When too few get too much everybody loses.

Feminism is about women living their lives on their own terms, marshalling the resources of the society to make that possible, and men embracing this as vital to a successful society and their own liberation.

Can it be that striving for equality of opportunity however imperfect the process not only benefits the individual but also creates benefits for the society that are unintended but wonderful?

Economics must be a 'moral enterprise' as much as politics claims to be. Economic outcomes need to be framed in terms of right and wrong not just efficiency if only because these often align in surprising ways that are good for society and the economy.

My vision of Canada is that any Canadian child from a family of limited circumstance can expect to have a chance at lifetime of unlimited opportunities.

Free trade is a wonderful thing. Time and time again economists have proven that free trade creates enormous wealth for each country 'on the whole'. Historians have shown that free trade is usually associated with rising political, social and cultural liberty. The perennial problem is that free trade always creates tremendous disruption for thousands even millions of individuals often concentrated in one geography, and where the state is idle, not investing in best in class instruments of social justice, free trade can be a permanent ticket out of the middle class, down, not up.

Tax policy should be founded on the principle of generating steady tax revenues sufficient to maximise environmentally sustainable economic growth in order to fund fair government.

Public policy should be designed to decrease inequality before the law and increase equality of opportunity.

Capitalism is not the problem; the problem is what we do with capitalism.

Content is always more difficult to argue than conspiracy.

Let the state regulate and the market operate (most things).

Welfare strategies are best designed as a hand up, not as a hand out.

Political debate should not be fact free fighting.

Explanation lasts longer than eloquence.

Always favour empowerment over dependency.

The most enduring public figures are embraced for the causes they fought for and not the concept of themselves they hoped others would remember them by.

Find your voice and don't be the echo of somebody else.

It is possible to operate on two different levels: the practical, cautious and conservative; and the realm of ideas, open, free, and radical.