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Weekend Reading: Raphael Hogarth: 'No Deal' Actually Means Total Supplication...

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Weekend Reading: Raphael Hogarth: "Some MPs Talk about 'No Deal' as a Great Liberation. 'No Deal' Actually Means Total Supplication, Handing Huge Control over the UK to the European Commission.Read the government’s technical notices on no deal, and you will find that an awful lot of sectors will need a decision from Brussels to keep trading...

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Note: The Ten Americans Who Did the Most to Win the Cold War: Hoisted from the Archives

Berlin No More Walls Pamela Anderson

Hoisted from the Archives: Note: The Ten Americans Who Did the Most to Win the Cold War:

  • Harry Dexter White: Treasury Assistant Secretary* who was the major force behind the Bretton Woods Conference and the institutional reconstruction of the post-World War II world economy. He accepted enough of John Maynard Keynes's proposals to lay the groundwork for the greatest generation of economic growth the world has ever seen. It was the extraordinary prosperity set in motion by the Bretton Woods' System and institutions--the "Thirty Glorious Years"--that demonstrated that political democracy and the mixed economy could deliver and distribute economic prosperity.

  • George Kennan: Author of the "containment" strategy that won the Cold War. Argued--correctly--that World War III could be avoided if the Western Alliance made clear its determination to "contain" the Soviet Union and World Communism, and that the internal contradictions of the Soviet Union would lead it to evolve into something much less dangerous than Stalin's tyranny.

  • George Marshall: Architect of victory in World War II. Post-World War II Secretary of State who proposed the Marshall Plan, another key step in the economic and institutional reconstruction of Western Europe after World War II.

  • Arthur Vandenberg: Leading Republican Senator from Michigan who made foreign policy truly bipartisan for a few years. Without Vandenberg, it is doubtful that Truman, Marshall, Acheson, and company would have been able to muster enough Congressional support to do their work.

  • Paul Hoffman: Chief Marshall Plan administrator. The man who did the most to turn the Marshall Plan from a good idea to an effective aid program.

  • Dean Acheson: Principal architect of the post-World War II Western Alliance. That Britain, France, West Germany, Italy, and the United States reached broad consensus on how to wage Cold War is more due to Dean Acheson's diplomatic skill than to any single other person.

  • Harry S Truman: The President who decided that the U.S. had to remain engaged overseas--had to fight the Cold War--and that the proper way to fight the Cold War was to adopt Kennan's proposed policy of containment. His strategic choices were, by and large, very good ones.

  • Dwight D. Eisenhower: As first commander-in-chief of NATO, played an indispensable role in turning the alliance into a reality. His performance as President was less satisfactory: too many empty words about "rolling back" the Iron Curtain, too much of a willingness to try to skimp on the defense budget by adopting "massive retaliation" as a policy, too much trust in the erratic John Foster Dulles.

  • Gerald Ford: In the end, the thing that played the biggest role in the rise of the dissident movement behind the Iron Curtain was Gerald Ford's convincing the Soviet Union to sign the Helsinki Accords. The Soviet Union thought that it had gained worldwide recognition of Stalin's land grabs. But what it had actually done was to commit itself and its allies to at least pretending to observe norms of civil and political liberties. And as the Communist Parties of the East Bloc forgot that in the last analysis they were tyrants seated on thrones of skulls, this Helsinki commitment emboldened their opponents and their governments' failures to observe it undermined their own morale.

  • George Shultz: Convinced Ronald Reagan--correctly--that Mikhail Gorbachev's "perestroika" and "glasnost" were serious attempts at reform and liberalization, and needed to be taken seriously. Without Shultz, it is unlikely that Gorbachev would have met with any sort of encouragement from the United States--and unlikely that Gorbachev would have been able to remain in power long enough to make his attempts at reform irreversible. *Also, almost surely an "Agent of Influence" and perhaps an out-and-out spy for Stalin's Russia. If so, never did any intelligence service receive worse service from an agent than Stalin's Russia did from Harry Dexter White....


#hoistedfromthearchives #politics #security #history #highlighted

Note to Self: Monday, February 11, 2019 from 4:00 PM to 6:00 PM (PST). IRLE. 2521 Channing Way. Berkeley, CA 94720: Kim Clausing: Open: The Progressive Case for Free Trade, Immigration, and Global Capital https://books.google.com/books?isbn=0674919335: "With the winds of trade war blowing as they have not done in decades and Left and Right flirting with protectionism, Kimberly Clausing shows how a free, open economy is still the best way to advance the interests of working Americans. She offers strategies to train workers, improve tax policy, and establish a partnership between labor and business...

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Please Help Me Out Here!

The Charge of the Brexit Brigade: “Forward, the Brexit Brigade!”
Was there a man dismayed?
Not though the soldier knew
Someone had blundered.

Theirs not to make reply,
Theirs not to reason why,
Theirs but to do and die.
Into the valley of Death
Rode the six hundred.

White papers to right of them,
Pollsters to left of them,
Presslords in front of them
Volleyed and thundered...

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A Rant on Trump, Trade, and China...

Clowns (ICP)

I'm still trying to come to terms with my Commonwealth Club event with Steve Moore last month. As therapy, I took some of my less-than-coherent ravings and tried to turn then into proper rant:


Steve, what you are saying is simply delusional.

You keep saying that Xi needs to deal. Why? Because, you say, Trump is deadly serious on China an sod will not back down.

Do remember that Trump declared victory on reforming NAFTA, "the worst trade deal in the history of the world", with small adjustments on autoparts rules-of-origin. Small adjustment on auto parts were enough to transform NAFTA, in Trump's mind, from the worst trade deal in the history of the world into something he is now very proud of. Xi has to be thinking that he should deal with Trump the same way that Mexico did—hang tough, provide a few symbolic concessions only, and Trump will cave. then things will go go back to business-as-usual.

What is there in the situation that would keep that from being the obvious strategy for Xi to follow?

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My view has always been that (a) too many big lies were told by pro-"Leave the EU" advocates and that (b) too large a proportion of the pro-"Leave the EU" advocates were shady grifters sure that they would lose but who were maneuvering for political advantage—they wanted to denounce the Establishment for failing to give everybody a pet unicorn, rather than to actually take power and run a unicorn-breeding stable. My view has been that the British press committed grave malpractice in hiding (a) and (b) from the electorate. My view has been that the best way to deal with this shambles is (c) for the press to come clean and (d) hold an informed revote—and that politicians opposed to a revote given the illegitimacy of the "Leave" mandate are shady grifters, etc. The argument against a revote is that it will split the country. But the country is split already. Better to have a split more-prosperous country with a government with a genuine mandate for its policies than a split less-prosperous country with a government with a fake mandate. Martion Wolf agrees with me: Martin Wolf: The Risks of a Second Brexit Referendum Must Now Be Run: "Another vote will be divisive —but what is happening is already splitting the country.... I can say what should happen. The answer is a second referendum.... I do not take that view with enthusiasm...

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Zack Beauchamp: Brexit Vote: Theresa May’s Defeat Reveals the Lies Behind Brexit: "UK Prime Minister Theresa May spent months negotiating a deal with the European Union on the terms of Brexit.... The UK Parliament voted to reject the deal by a resounding 432-202 margin.... May’s tenure in office... was premised on the lie that she could work out a Brexit deal palatable to all sides. Now, in the clarifying light of this vote’s failure, it’s time to be honest.... Either the UK exits the EU without a deal by the March 29 deadline, which virtually every expert agrees would result in economic catastrophe, or else the country pulls back from the brink and decides to remain in the EU. These options aren’t what the Brexiteers promise, but it’s difficult to envision any other ones after the failure of May’s deal...

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Ian Dunt: Historic Defeat: May Faces Her Day of Judgement: "At the moment there is no majority for no-deal or a People's Vote. Many MPs have ruled out both. But soon they are going to have to decide which of the two they find least objectionable. No-deal comes closer and closer.... Options are likely to whittle down until only a People's Vote is left. The question is whether enough MPs have the bravery and responsibility to prevent no-deal. We're about to find out...

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Marina Hyde: Welcome to the Westminster apocalypse. Have you thought about theocracy instead?: "Here comes the affectedly shambling figure of Boris Johnson—not so much a statesman as an Oxfam donation bag torn open by a fox–who could conceivably still end up prime minister of no-deal Britain. May needed to go again to the EU 'with a high heart, fortified by the massive rejection of the House of Commons', judged Johnson, speaking as always like a Taiwanese news animation of Winston Churchill. In the meantime, 'we should be actively preparing for no deal with ever more enthusiasm'...

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Daniel Larison: Threat Inflation and "The Jungle Grows Back": "Damir Marusic has written an incisive review of Robert Kagan’s The Jungle Grows Back.... 'Kagan... rues the fact that... no bogeyman big enough to keep Americans focused on maintaining their preeminent position in the world exists.... Kagan therefore makes an attempt to cast first Vladimir Putin’s Russia, and then Xi Jinping’s China, as authoritarian challengers and potential threats to the American way of life...' The end of the Cold War was a calamity for many hawks because it deprived them of a sufficiently powerful and menacing adversary, and the history of U.S. foreign policy over the last three decades has been the desperate search for a suitable replacement...

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Costs and Benefits of International Capital Mobility: Reply to Bhagwati: Hoisted from 20 Years Ago

Needless to say, time has left me a lot wiser: We need to design economies so that they can operate without disaster even when deregulatory clowns like those of the George W. Bush or the Donald J. Trump administrations are in control of the levers of policy at key moments. How to do that is not so clear. What is clear is that only a fool today would think that our political economy would support a clever technocracy so that we might have our cake and eat it too. Indeed, the most likely scenario seems to be that we will be unable to eat our cake, and then the kleptocrats will steal it out from under our noses so that we will not have it either. In short: I should have listened harder to Jagdish 20 years ago...

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Hoisted from the Archives: Reply to Bhagwati: "I open my May/June [1998] issue of Foreign Affairs to discover myself pilloried in an article by Jagdish Bhagwati between Paul Krugman and Roger C. Altman (excellent company to be in, by the way: much better than I am used to) as a banner-waving proponent of international capital mobility, guilty of "assum[ing] that free capital mobility is enormously beneficial while simultaneously failing to evaluate its crisis-prone downside."

I rub my eyes in surprise. I had not thought of myself as a banner-waving proponent of international capital mobility.

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Barry Eichengreen: The Euro at 20: An Enduring Success but a Fundamental Failure: "The belief of... Francois Mitterrand and... Helmut Kohl that a single European currency would apply irresistible pressure for political integration. It would lead eventually to their ultimate goal.... To function smoothly, monetary union requires banking union... an integrated fiscal system.... Banking union and fiscal union will only be regarded as legitimate if those responsible for their operation can be held accountable for their decisions by citizens.... Monetary integration creates a logic and therefore irresistible pressure for political integration. Or so the euro’s architects believed...

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Yes, the "LEAVE!" faction of the British Conservative and Unionist Party is bats--- insane. Any questions?: Arj Singh: 'Increasing Number' Of Tory MPs Are Considering No-Deal Brexit As A 'Viable' Plan B: "A Leave-backing former cabinet minister said... 'People aren’t going round and saying "No Deal" is going to be a cakewalk. But... people are... asking "how much will this actually impact people’s lives?" We won’t be able to get certain foods like bananas or tomatoes but it’s not like we won’t be able to eat. And we’ll be leaving at a time when British produce is beginning to come into season, so it’s the best possible time to leave with no deal'...

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Maybe now that Trump has embraced lowering corporate profits as a policy goal, Mike Pence will be willing to invoke Amendment 25: Josh Barro: China Is Losing Trump’s Trade War—and So Are We: "This is the insanity of the president’s trade war policy: it’s negative-sum.... Trump’s own economic adviser is going on television and saying his policy is going to reduce corporate profits. I wrote a couple of weeks ago about the strange disconnect between financial markets and economic data.... Well, as Bloomberg put it in a headline this morning, 'Bad Stuff the Stock Market Worried About Is Starting to Happen'.... The economy is weakening, and market participants know it, but the weakened performance has not yet shown up in lagging economic data...

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Richa Gupta and Umang Aggarwal: Is there a “Late Converger Stall” in Economic Development? Can India Escape it?: "A major driver of these good times is 'economic convergence', whereby poorer countries have grown faster than richer countries and closed the gap in standards of living. The convergence process has been broadening and accelerating for the last 20-30 years.... [But] the possibility of... a 'Late Converger Stall'...

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Trade and Distribution: A Multisector Stolper-Samuelson Finger Exercise: Hoisted from 2008

Il Quarto Stato

Hoisted from 2008: Trade and Distribution: A Multisector Stolper-Samuelson Finger Exercise: This argument of an inconsistency between free trade and the well-being of the majority of potential voters rests substantially on the two-factor example of the Stolper-Samuelson result. It does not fare too well when we generalize to a situation in which there are a number of different factors—even if the ownership of the abundant factors of production is very concentrated indeed... https://delong.typepad.com/stolper-samuelson_finger_exercise-1.pdf

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Stagnant Real Wages and Secular Stagnation Are Not Closely Related: DeLong FAQ

EconSpark: Derrick Miedaner asks: What role, if any, does secular stagnation play in the flat growth of wages since the recovery?": I reply: I think Ed Lambert is correct. "Secular stagnation" is probably not the best label for the worry. The worry is that financial markets have gotten themselves wedged into a situation in which frequently and for sustained periods of time it is the case that the full-employment real safe short-term Wicksellian neutral rate of interest turns out to be less than the negative of the central bank's inflation target. In a flexible-price full-employment economy, the economy deals with this and maintains full employment by having the price level drop instantaneously and discretely whenever this occurs in order to generate the extra inflation needed to get the market rate at the zero lower bound to its value needed for full employment, the real safe short-term Wicksellian neutral rate of interest. This was one of the major (but I think often overlooked) points of Krugman (1998) https://www.brookings.edu/wp-content/uploads/1998/06/1998b_bpea_krugman_dominquez_rogoff.pdf.

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