Guest Post: A Christmas Tale – Splatacrobat

It was my dad’s birthday this week and he would have been 83 but passed away this January. This song is significant to my family as our dad used to sing it to us when we were children on Christmas eve. We celebrated Christmas and shared presents on Christmas eve following on from the European tradition and my parents added other fun traditions that made the experience of Christmas as real and meaningful as they could for me and my brothers and sisters. Traditions that my wife and I have continued with our children to this very day.

The reasons my parents chose to follow German tradition in exchanging presents on Christmas eve were twofold. First they could sleep in thus avoiding the din of five children at six am all howling “can we open our presents now”. Secondly and most importantly Father Christmas actually visited us on Christmas eve!

Our parents devised a cunning plan so we never saw him but we did hear him in the house.We would have Christmas dinner and when it was starting to get dark that would be the signal for the Christmas magic to begin. Dad would give us all set tasks to do in preparation for St Nicholas visit. We would lay out our pillow cases on the lounge chair, light incense cones (we had a wooden Santa that smoked a pipe and when you placed the Santa over the incense smoke rings would come out his mouth). My brother and I would put out on the table a small slice of Christmas cake and a miniature glass of beer. My older sister would light the “Weihnachts Glockenspiel” (Christmas Carillon) . After all these chores were done dad would shepherd us all into one of the bedrooms with warnings like ” Father Christmas will be here soon so we had better hide just in case someone has been naughty and he brings Black Peter. We were all sufficiently convinced that we had been good all year but just to be on the safe side we took our places in the bedroom (usually the farthest from the door) and waited.

It was at this point our mum would remember that the hose had been left out on the patio and she needed to move it otherwise Father Christmas might trip and hurt himself. This diversion gave my mum an opportunity to put the front door key in the letterbox and signal our neighbour to come to our house and fill the pillow cases while we all quietly hid. Maybe I was a bit slow on the uptake but I never figured out this ruse. Both parents in the bedroom with me? All my siblings with me? Then that must follow that it can only be Father Christmas in our living room!

Father Christmas would enter our house with a loud knock on the door. We could hear the clanging of bells and footsteps. Sometimes we could hear footsteps coming right up to the bedroom door then stop. It was at that moment I could feel my heart pounding so loud I thought he would hear me and open the door with Black Peter calling my name. Eventually the footsteps grew softer and with a loud bang of the front door slamming he left.

Mum and Dad would then banter together arguing whether the door really slammed and had Father Christmas really departed? Dad would say hush and we all listened intently. All we could hear was the soft ting of the bells on the Glockenspiel and smell the sweet smell of Christmas incense throughout the house. Dad would then say in hushed tones that we should softly sing a few carols so we are sure Father Christmas has left. We all sang Silent night, Come all ye faithful, and then dad would conclude by singing Oh Tannenbaum in German. When he finished he would tell us all how much they loved us and wished us all a blessed Christmas.

“Who is going out first?” my Father would bellow breaking the silence that all of us thought was the only thing separating us from Black Peter should he still be in residence. As my younger brother and I were by this time firmly rooted to the floor under the bed it was always left to my oldest brother to take one for the team and venture out first. The door would open and we warily tiptoed out to the living room to discover the cake eaten, beer drank, and five obese pillow slips with wondrous gifts from a saintly man named St Nicholas. After a short time we would then exchange our own presents that we had bought or made and play until late in the night.

My wife and I have carried on this tradition with our children. Every year we sent them personalised letters from Father Christmas with him telling them of their successes and triumphs throughout the year. I have lit the candles on the same Weihnachts Glockenspiel from my childhood and the same incense cones that my father gave me many years ago. Handmade stockings replaced the pillow slips though. We also sang carols and I told the Christmas story with the aid of knitted dolls made by their Grandmother. Beer and Christmas cake was left out and up until last year we were still hiding in the bedroom hoping Black Peter did not visit us instead.

My two youngest are now 12 and 13 and as you could imagine we don’t think we can get away with another year of make believe but what such joyous experience it has been. We have been watching their faces and sharing the excitement of childhood at Christmas time for over 20 odd years and it is the most cherished memory I have of my family. We even managed to get our 21 year old daughter to believe Father Christmas was real until she was 13! A rare thing in this day and age. I will looking forward to my children carrying on these traditions and sharing the joy in their children’s eyes in years to come.

Merry Christmas one and all.

Posted in Cultural Issues | 51 Comments

A year at the Adam Smith Institute

Not a bad year? From Aemonn Butler. The Institute is strategically located in London.


Annually, the University of Pennsylvania ranks the performance of world think-tanks. As usual in 2014, we came well ahead of others with budgets up to 100 times ours. Yes, really. Among the highlights, we ranked:

* Number 3 worldwide among Top Domestic Economic Policy Think Tanks
* Number 8 worldwide among Top International Economic Policy Think Tanks
* Number 13 worldwide for our Outstanding Policy Programmes
* Number 16 worldwide for the Best Use of Social Networks
* Number 20 worldwide for the Most Significant Impact on Public Policy.

I was rather chuffed that my book Foundations of a Free Society received the 2014 Sir Antony Fisher Award for the best think-tank publication. And the next one is in the pipeline…

Our President, Dr Madsen Pirie, has just signed up with Bloomsbury for an expanded edition of his How to Win Every Argument, and was credited in Owen Jones’s book The Establishment as the pre-eminent leader of the free-market, libertarian revolution that replaced the postwar Keynesian consensus.

Deputy Director Sam Bowman was the star of an IBT piece about the new wave of British libertarians (and his use of the dating app, Tinder)…


We held over 40 events this year, including 17 Power Lunches and Patrons Dinners, 12 events for the under-30s, and lectures open to all on subjects from prison reform and sweatshops to effective altruism. Highlights included our Tax Freedom Day party (the 28th May, don’tcha know), a lecture by the 3D-gun-printer Cody Wilson, our Ayn Rand Lecture (which you can watch here), our under-30s boat trip, and our Fall of the Berlin Wall party with Czech ex-President Vaclav Klaus. And we plan a lot more in 2015!

In addition, we held academic events reaching over 500 school students and monthly meetings of our under-30s Next Generation. We’ve given out over 2,000 free copies of our primers to students and libraries, including new releases Why Liberty Works and 23 Things We ARE Telling You About Capitalism. We had dozens of entries for our annual Young Writer on Liberty Award, and then there was Freedom Week, an intensive student seminar we run jointly with the Institute of Economic Affairs.

Institute President Dr Madsen Pirie kept up his usual pace in 2014, addressing youth groups across the UK and in Berlin, Prague, Bratislava and Brussels. Between all ASI staff, we’ve spoken to over 2,000 students from schools and universities this year.


The Entrepreneurs Network, TEN, supported by the Institute since 2013, hit its stride in 2014, and is now in contact with scores of entrepreneurs, startups and gazelles. TEN has released a manifesto, a poll of MPs and a report on the graduate entrepreneurs visa, all gaining plenty of media coverage, including The Guardian, The Telegraph, City A.M., Forbes and Huffington Post.


Posted in Uncategorized | 2 Comments

Is Joe Hockey the worst Treasurer in 40 years?

Several weeks ago I was asked if I thought Joe Hockey was a good Treasurer or not, and my answer was “too early to tell”. To be fair, I think that is still my view, but I suspect that, on current trends, history will not judge him kindly. But worst in 40 years?

According to a poll undertaken by Essential Research and reported in The Australian:

JOE Hockey has lost the con­fi­dence of Australian voters.

He is regarded as the worst treasurer of the past 40 years, and Labor Treasury spokesman Chris Bowen is now seen as a better economic manager.

An opinion poll conducted by Essential Research exclusively for The Weekend Australian found that Mr Hockey was ranked below former Labor treasurer Wayne Swan (2007-13) when respondents were asked to rate Australia’s most notable treasurers since the 1970s.

Worse than Wayne Swan? Well that’s got to hurt.

Hockey being defensive 1
Well, they are being a bit naughty. The weasel words are “most notable treasurers”. There is no way Hockey would rank better than Peter Costello or Paul Keating. Then I’m surprised that anyone remembers that John Howard was Treasurer. But there are some glaring omissions from that list. The Liberals have only had three Treasurers since the late 1970s. Howard, Costello, and now Hockey. The ALP have had several – but only one that history remembers well. So the headline result is unreliable, if not dodgy.

Then look at the comparison between Hockey and Chris Bowen. Look up and down the columns. 62% of Lib/Nat voters prefer Hockey and 54% of ALP voters prefer Bowen. Okay – nothing surprising there. But look at the Greens voters. 55% prefer Bowen to Hockey – not surprising either. But the overall result is Bowen over Hockey. That I suspect is due to a weighting issue. Now the overall results are going to be weighted by the proportion of voters in the sample relative to the population. But did they weight the sample by how people voted at the last election, or how they say they’ll vote at the next election? I suspect the latter and that is what is driving the overall result. The 55% in the Greens column is responsible for the anti-Hockey result.

Now that isn’t to say that Hockey is a better Treasurer than Bowen would be – I suspect time will resolve that particular question. But we shouldn’t put too much store in this particular result. What should concern Hockey is the decline between August and December from 34% to 27%.

The thing that should concern all of us, is Hockey’s defensive response to Troy Bramston’s tweet:
Hockey being defensive
Too defensive – who paid for the poll? Is that the question that Hockey (or the staffer who runs his account) should be asking? A case of shooting the messenger. Hockey isn’t the worst Treasurer in 40 years, but is also far off the pace and needs to lift his game. This weekend when Tony Abbott calls Hockey to confirm his position given the cabinet reshuffle Hockey needs to be told, “One more stuff up and we’ll both be out of a job”.

Posted in Budget, Federal Politics, History | 85 Comments

Christmas Countdown I

Posted in Cultural Issues | 29 Comments

On the first Keynesian texts but when will there be the last?

In the thread over introductory texts on economics from the 1890s to the 1950s, in which I discussed Clay’s Economics, the issue has swung round to what is a story frequently told on the left, how political pressure from the right killed off the supposedly great first Keynesian text, Loris Tarshis’s The Elements of Economics. To which I contributed the following:

This note is in regard to Lorie Tarshis’s first “Keynesian” text in the US, his Elements of Economics, which supposedly was killed off by an attack from William F. Buckley, thereby clearing the way for Samuelson to take the field with his own more cautiously written Keynesian tract. This story about Buckley and Tashis is an old established myth. In fact, Buckley went after Samuelson just as much as Tarshis. This is the start of Buckley’s assessment, which in some eyes might even look quite prescient:

“Marx himself, in the course of his lifetime, envisaged two broad lines of action that could be adopted to destroy the bourgeoisie: one was violent revolution; the other, a slow increase of state power, through extended social services, taxation, and regulation, to a point where a smooth transition could be effected from an individualist to a collectivist society. The Communists have come to scorn the latter method, but it is nevertheless evident that the prescience of their most systematic and inspiring philosopher has not been thereby vitiated.

“It is a revolution of the second type, one that advocates a slow but relentless transfer of power from the individual to the state, that has roots in the Department of Economics at Yale, and unquestionably in similar departments in many colleges throughout the country. The documentation that follows should paint a vivid picture.” — William F. Buckley, Jr. God and Man at Yale: The Superstitions of Academic Freedom, Henry Regery, 1951, p. 46-47.

And I might also mention Buckley’s attitude to Keynes, also from the same source, which would have applied to Samuelson quite as much as Tarshis:

“The individualist insists that drastic depressions are the result of credit inflation; (not excessive savings, as the Keynesians would have it) which at all times in history has been caused by direct government action or by government influence. As for aggravated unemployment, the individualist insists that it is exclusively the result of government intervention through inflation, wage rigidities, burdensome taxes, and restrictions on trade and production such as price controls and tariffs. The inflation that comes inevitably with government pump-priming soon catches up with the laborer, wipes away any real increase in his wages, discourages private investment, and sets off a new deflationary spiral which can in turn only be counteracted by more coercive and paternalistic government policies. And so it is that the “long run” is very soon a-coming, and the harmful effects of government intervention are far more durable than those that are sustained by encouraging the unhampered free market to work out its own destiny.”

The true reason, in my view, that Samuelson’s text won out over Tarshis’s is because it is a far better book, much much more accessible. The macroeconomic side, with its C+I+G diagrams and others of a similar kind, is a fantastic improvement in the underlying power of explanation. I have first editions of both Samuelson and Tarshis, and there is no comparison. Even Samuelson’s 1948 version is an order of magnitude better, both to teach and to learn from. There are virtually no diagrams in the macro half of Tarshis’s text (and the diagrams in the micro half are often bizarrely complex), while Samuelson has a number of diagrams (a small number, especially in comparison the text we are now all familiar with), which bring out the underlying message in a way that the hundreds of pages of diagramless text in Tarshis does not.

I might add, but only just for fun, that in my Defending the History of Economic Thought, I discuss the ways in which diagrams have dumbed down economic thought, so that we now move lines in a two-dimensional space, instead of trying to think through the actual economic adjustments that are supposedly going on. But that is just by the way.

And if you have reached this far, Nato asked a very interesting question, for which I am very grateful, and for which there is an interesting answer. The question: “Talking about your contributions, Say’s law and the classics, is the Elgar debate with Rochon still running?”

The answer: We had agreed to a third letter each and when I sent off my third letter off, I suggested that perhaps we could even go for a fourth. The reply that came back was that Rochon had decided that he no longer wished even to do the third, so we would stop there without publishing my third letter.

It is clear that he is no longer game to go on, but that was, in my view, all the more reason to hold him to what he had agreed. Keynesian economics is the absolute standard in macroeconomics at the moment. If anyone should have been overwhelmed in this debate – going only by the numbers – it should have been me. My third letter was a clarification of some of the issues already raised, I replied to what had been written previously, as well as going on with a further discussion of the problems with Keynesian theory. That is just what such a debate should be. Each of us gets to respond to the issues the other has raised. By probing for the weak points in each other’s arguments, we bring the various tensions on our own positions to light and, hopefully, learn something at the same time.

I can only say that if Keynesian theory is as indefensible as it appears from the the first two letters defending Keynes, and which I think my third letter would have helped to emphasise to others, then I think there is some kind of moral duty to publish my third letter. This is not some small matter, but involves the entire theoretical and strategic approach to managing our economies. If the Keynesian defence is as feeble as it has been shown it to be – and I would hardly deny that there may be others who could do a better job – then I think my third letter should enter into the public debate, and if there are others who think they can do better, they can come forward to try to explain the Keynesian position more clearly. But to me this is a debate that we need to have.

I will only add that at this point the matter is not yet closed.

Posted in Classical Economics, Economics and economy | 21 Comments

Australia’s economic outlook still gloomy as time to fix finances runs out

In The Australian today:
“With this week’s mid-year economic and fiscal outlook projecting deficits through to 2019-20, Australia’s prosperity is as threatened as our peaceful way of life. But while the horrors of terrorism have brought Australians together, the economic risks this country faces are tearing our political system apart. Whether the government can regain the initiative, focusing the nation’s attention on the dangers of simply letting our fiscal situation drift as export prices plunge, is the crucial question for the year ahead.”

Posted in Uncategorized | 11 Comments

Open Forum: December 20, 2014

Posted in Open Forum | 1,348 Comments

Guest Post: Philippa Martyr – Double Demerits on Terrorism

[With apologies to Brian of Moorabbin, who I love like a brother.]

Last night on the news, I watched with interest as WA Police kicked off the Christmas double-demerits season. Police on road bridges used long-range cameras to track and identify individuals using mobile phones while driving. These individuals were then pulled over and penalised. Unmarked motorbike patrols monitored and pulled over people for a variety of offences, including using phones and not wearing seatbelts. Booze buses were also set up, and the rat-routes nearby sealed off to ensure that miscreants didn’t do a runner.

This made for an interesting juxtaposition with images of the masses of flowers in Martin Place, where a completely and utterly dangerous man not only managed to slip through everyone’s monitoring, but was allowed to hold a group of people hostage for over 12 hours in a public place.

But let’s not carp too much. Rather than continually criticise the police in various states for revenue-raising, I’d like to praise them. They have hit upon an ideal model of user-pays funding. You use the roads, you pay for them via a range of traffic offence penalties. If you are a good person and avoid all these, you get to use the roads pretty much for free, apart from your driver’s licence fee and car registration. And society is thus a safer and better place all round.

So why not extend this principle to the Australian Federal Police and any other security agency, and introduce a system of financial penalties for the entire range of terrorist activities? For example: write a crazy letter to the family of dead veteran – first offence, $1000. Write another – $2000. Write a third – $3000. Fail to pay your fine? Off to court with you, my friend – just like the unpaid parking and speeding fines. And if they can’t find you, then they cancel your licence. Terrorist tweets and Facebook entries could attract similar penalties: evidence can be easily captured in screen-grabs.

Better, you could tie this to the receipt of welfare payments. First offence – suspension of all individual welfare payments, including the disability allowance, for one month. Second offence – suspension for two months. Third offence – suspension for one year. And if you were really keen, you could also tie this to the driver’s licence demerit system, to take even more dangerous people off the roads.

The Islamic community would surely endorse this scheme, because it would help to identify these tragically isolated lone wolves within their communities, and separate them from the peaceful and loyal majority. They could even perhaps benefit in some small way financially from the detection of terrorist individuals, based on the provision of sufficient evidence. Prominent seasons of community festival could be run in parallel with a double-demerits system, where individuals could pay twice their normal fines for these offences.

It’s just a thought.

Posted in Guest Post | 71 Comments

Clay’s Economics

This was the query at the history of economics website, which I might note, has had quite an interesting response:

I’m working on an analysis of introductory economics textbooks published in the United States between about 1890 and 1950 (the period between Marshall and Samuelson, roughly). I’ve accumulated an ad hoc collection of texts based on the holdings of my library and scattered references in the secondary literature (Elzinga 1992, Walstad et al 1998, and Giraud 2013 in particular), but I was hoping that there might be some more systematic way to generate a universe of texts from which to sample. Does anyone have a recommendation for a good source that discusses principles texts in this period, perhaps with information on relative influence (number of editions, course adoptions, or sales)? Does such a source exist?

This was my own contribution:

In a reply to a recent request for any centenary celebrations coming up in economics in 2016 which was put out by the editors of the History of Economics Review, our HET journal here in Australasia, I wrote:

“2016 is the hundredth anniversary of the publication of what I think of as the best single introductory text on economics published in the twentieth century, Henry Clay’s Economics: an Introduction for the General Reader. I would very happily provide you with a shortish note on this great text – you have to see just its publication history from 1916 to 1942 when the second edition was published to appreciate just how extraordinary it was. Used everywhere, including Oxford and Cambridge, and not just mechanics institutes. Also the best summary of pre-Keynesian theory available, in my view, from any source.”

I realise that the request in this instance is for “introductory economics textbooks published in the United States” and Clay was published by Macmillan in the UK. But looking here at my lovely first edition, the second listing of the publisher’s location reads in a way which does suggest that it would have had a publication history within the US:

“The Macmillan Company
“New York . Boston . Chicago
“Dallas . San Francisco”

And as in indication of its presence in the United States, I also have this: Problems and Exercises to Accompany Clay’s Economics for the General Reader and Ely’s Outlines of Economics, which was published in 1921, whose author was:

“H. Gordon Hayes
“Professor of Economics in Ohio State University”

I might point out that in this set of questions – which you might for fun test your graduate students on for their understanding of economics – it is Clay who is mentioned before Ely.

I will finally mention that in The Great Gatsby, a text as American as it gets, we have this passage in reference to Gatsby himself as he stands waiting in the library for Daisy to arrive:

“[He] looked with vacant eyes through a copy of Clay’s Economics.”

If even Gatsby was reading Clay, who wasn’t?

What I didn’t mention was that I titled my own text to follow Clay’s: Free Market Economics: an Introduction for the General Reader. The number of out and out Keynesian falsehoods that are revealed by going through Clay is astonishing, starting with acceptance of Say’s Law means classical economists always assumed full employment. It’s not a short book, and its lack of diagrams makes it hard for someone of the present generation of economists to bother with, but it very efficiently gets the job done. And naturally, what I like best about it, is that it is the economics of John Stuart Mill, brought up to date for the first half of the twentieth century, just as my own text is Mill for the 21st century. Did I ever mention, by the way, that the cover of my book shows a Mill made of Clay?

Posted in Classical Economics, Economics and economy | 6 Comments

A quarter of the population is now suspect?

Paul Sheehan writing in the SMH:

Monis is a classic case study of why Australia needs to have probationary conditions applied to the residence status and then citizenship granted to immigrants, refugees and asylum-seekers. To cover for mistakes, this probationary status needs to be rigorous and lengthy.

Classic case of over-reach. More than 25% of the Australian resident population is foreign born. When dealing with numbers like that it is better to work by exception. Now we know the process failed in the case of Monis:

Magistrates, lawyers and police prosecutors collectively decided that Monis, with a long history of harassing behaviour, with links to the brutal murder of his former wife, with charges for sexual assaults of multiple women, with a history of extreme political views, with convictions for writing threatening letters, and with an open record of support for jihad, was deemed no threat to society.

Okay – that means that the legal processes need to be tightened up. I suspect that will happen – perhaps too much and in inappropriate ways.

If only we had 5-years of meta-data to detect people like Monis (/sarc).

There are two other points I want to make about Paul Sheehan’s article:

The instability through the Muslim world is growing worse. Thousands of Muslims are killing thousands of Muslims, leaving millions of Muslims displaced. The murder of more than 100 school children in Pakistan on Tuesday is the latest numbing instalment of the butchery being carried out in the name of Islam in Syria, Iraq, Afghanistan, Nigeria, Libya, Pakistan, Somalia, Yemen, Chad and Kenya. Egypt is under martial law. Iran is a theocracy. Numerous outbreaks of jihad-inspired violence have taken place in Western Europe, Russia, Canada, the United States and Australia.

The biggest victims of Islamic fundamentalism are other Muslims. To the extent that we have a refugee program that protects people who are in fear of their lives that means we are going to get more Muslims not fewer. Now there are calls to close our borders and refuse asylum to people from the Middle East. To be fair – there is precedent for this type of policy choice. In the 1930s when Europe was in turmoil and the biggest victims of fundamentalism were other Europeans, many countries closed their borders to European refugees. With the benefit of hindsight, we are now somewhat embarrassed by that decision.

Now some will want to argue (and, no doubt, will tell me in the thread) that there is a huge difference between Jewish refugees and Muslim refugees. I’m not convinced any differences are that big. We should look to our common humanity before we look to our differences. Arguments about people not fitting in and leading lives of crime or turning to Jihad overlook one very important consideration.

To the extent that anyone lives a life of crime or Jihad it is because we have not enforced our own laws.

That is the problem with Monis – people are asking why it is that a man with his track record was not in gaol. In a liberal democracy we have few personal prohibitions – you can eat what you like, how you like, wear what you like, marry whom you please (as long as it is a single person of the opposite gender), worship as you please. You may not circumcise your daughters, beat your wife, or murder your ex-wife or anyone else. It isn’t hard – most people can cope with those rules. When we fail to enforce our own very minimal standards of behaviour it is bit difficult to argue that immigrants don’t live up to our standards when they perceive, quite rightly in the breach, that we have none.

Final point:

A dissident former army major, Bernie Gaynor Jnr, says that more Australian Muslims have gone to fight with IS than have enlisted in the Australian Army this year. His claim has not been disputed by the Army.

Unfair comparison – this confuses stocks and flows. More importantly it overlooks the recruitment problems the ADF faces. I suspect every large AFL club has more members than the ADF has personnel. More kids would have renewed their membership this year than joined the ADF.

Posted in National Security, Politics, Tough on Crime, tough on criminals | 194 Comments