Economists From Australia

"If there was never any difference between the value of commodities someone desired to sell and buy on the market, then no-one would ever desire to accumulate wealth. But an essential feature of capitalism is the existence of a group of agents with precisely that intention."

"This ascendancy of economic theory has not made the world a better place. Instead, it has made an already troubled society worse: more unequal, more unstable, and less 'efficient'."

"With the market so much more in control of the global economy now than fifty years ago, then if economists are right, the world should be a manifestly better place: it should be growing faster, with more stability, and income should go to those who deserve it."

"Though mainstream economics began by assuming that his hedonistic, individualistic approach to analysing consumer demand was intellectually sound, it ended up proving that it was not."

"Thus while diminishing returns do exist when industries are broadly defined, no industry can be considered in isolation from all the others, as supply and demand curve analysis requires."

"Not even an economist can make time stand still (though some victims of economics lectures might dispute that!)."

"Economics is not the Emperor of the social sciences, but the Humpty Dumpty."

"Which comes first — price being set by the intersection of supply and demand, or individual firms equating marginal cost to price?"

"Even economists can't escape the fact that, as commodities go, labour is something out of the ordinary."

"The term 'capital' has two quite different meanings in economics: a sum of money, and a collection of machinery."

"The position I favor is that economics is a science, but a rather pathological one."

"In general then, and contrary to Friedman, abandoning a factually false heuristic asumption will normally lead to a better theory — not a worse one."

"What makes economics different from and inferior to other sciences is the tenacity with which it holds to its core beliefs in the face of either contrary factual evidence or theoretical critiques that establish fundamental inconsistencies in its intellectual apparatus."

"Economic theory in general ignores processes which take time to occur, and instead assumes that everything occurs in equilibrium."

"Why do economists persist in modelling the economy with static tools when dynamic ones exist; why do they treat as stationery an entity which is forever changing?"

"The obsession with equilibrium has imposed enormous costs on economics."

"Rather like the Bible is for many Christians, the General Theory is the essential economics reference which few economists have ever read."

"The belief that a capitalist economy is inherently stabilising is also one for which inhabitants of market economies may pay dearly in the future."

"Trusting souls who accept economic assurances that markets are efficient are unlikely to fare any better this time when the Bull gives way to the Bear."

"Since in reality the stock market is inhabited by mere mortals, there is no way that the stock market can be efficient in the way that economists define the term."

"The EMH cannot apply in a world in which investors differ in their expectations, in which the future is uncertain, and in which borrowing is rationed."

"If investors disagree about future prospects of companies, then inevitably the future is not going to turn out as most — or perhaps even any — investors expect."

"If values are fairly evenly distributed around an average, then roughly two-thirds of all outcomes will be one standard deviation other side of the average."

"If financial markets aren't efficient, then what are they? According to the 'fractal market hypothesis', they are highly unstable dynamic systems that generate stock prices which appear random, but behind which lie deterministic patterns."

"There are numerous theorems in economics that rely upon mathematically fallacious propositions."

"If a 19th century capitalist Machiavelli had wished to cripple the socialist intelligentsia of the 20th century, he could have invented no more cogent weapon than the labour theory of value. Yet this theory was the invention, not of a defender of capitalism, but of its greatest critic: Karl Marx."

"You have a voice, which has been perhaps been quiescent on matters economic because you have in the past deferred to the authority of the economist. There is no reason to remain quiet."

"China is simply too big and too central to be ostracised. My point is that China is now so big and it is going to grow so large, it will have no precedents in modern social economic history.... we haven’t come to a point of accommodation where it acknowledges China’s pre-eminence in east Asia and the Asian mainland, in which case we can start to move towards a sensible relationship again with China. The key point is – is the rise of China legitimate? Is taking 20 per cent of humanity – 1.4 billion people – from abject poverty something the world should welcome? And in our terms, it has completely remodelled the Australian economy. If we give China the recognition I believe it is due in terms of its legitimacy … then I think a lot of these issues, the so-called 14 points, sort of fall off the table.... We have no relationship with Beijing, so why would the Prime Minister of Malaysia or Singapore or Thailand talk to us about east Asia when we are non-speakers with the biggest power, the Chinese?"

"Monday will be the 25th anniversary of one of the most prophetic speeches in Australian political history. Then prime minister Paul Keating told the National Press Club: "When the government changes, the country changes ... but what we've built in these years is, I think, so valuable - to change it and to lose it, is just a straight appalling loss for Australia." He was dead right. The legacy of John Howard's government is the opposite of the picture he painted on election night in 1996..."

"Former Australian prime ministers tend to be less conspicuous in public life than their counterparts in other countries... But there are a few radiant surprises...The Labor side of politics has Paul Keating, the last, dare one use the word, visionary, in the prime ministerial pack... Not a day goes by that does not see Australian politicians sign themselves up to the next suicidal conflict that might take place over Taiwan or over the South China Sea. On November 10, Keating, at the Australian National Press Club, was bursting to speak to the audience about his taking of the geopolitical temperature. It was his modest effort to try to arrest this seemingly imminent move... The reaction to such sober edged analysis was never going to go down well in the lunatic, zombie establishment gearing, and oiling, for war. There are invisible submarines to build, a regional arms race to encourage, false promises to make... There have been some defenders of the former prime minister, insisting that he has something sensible to say. ABC host and commentator Stan Grant tells his audience that Keating “is not an apologist for Chinese authoritarianism but a cold-eyed realist about Chinese power and how it can be incorporated into a global political order.” But realism, for the moment at least, has been anathemised. The Anglophone alliance that is AUKUS is testament to that fact. Blood-thirsty nostalgia, and the ning-nongs, are intent on running the show."

"The arse-end of the world [said to have been referring to Australia]."

"(China debate ‘informed by the spooks’) Australian public debate is informed by the spooks. Our foreign policy debate now in Canberra is informed by the security agencies, so you are not getting a macro view of China as it really is. China wants its front doorstep and its front porch, that is Taiwan, its sea, it doesn’t want American naval forces influencing that. It wants access out of its coast into the deeper waters of the Mariana Trench in the Pacific. That’s what it’s about fundamentally."

"In October 2020, the IMF in its annual report nominated China as the world’s largest economy. It says China’s economy is now 20% larger than the United States, 24tn versus 20tn – a report which was endorsed by the CIA. So you have the IMF and the CIA out there saying China is 20% bigger than the United States now. These are the key numbers. American GDP per capita is $60,000. China’s GDP per capita is $10,000. But as China is moving out of its old model of cheap manufactured goods, their income is going to rise. But at 10,000 US dollars per capita, China is 20% bigger than the US. How many years is it going to take China to get to 20,000? Not 60 … but with the highly urbanised economy of theirs, it will take a decade, perhaps. If it gets to $20,000 US per capita, it will be 2.5 times bigger than the United States. To which the United States says: “That is all very interesting but, look, if you behave yourselves, you Chinese, you can be a stakeholder in our system.” And you would not have to be Xi Jinping to take the view, if you are a Chinese nationalist, “let me get this right, we are already 1.25 times bigger than you, we will soon be twice as big as you and we may be 2.5 times as big as you, but we can be a stakeholder in your system, is that it?” It would make a cat laugh."

"(On Xi as president for life: ‘A belief in harmony’) Well, it’s a good way to stay in power, I guess. It’s not my way. I actually believe in a community’s right to dismiss the government. But you’ve got to remember that China is broadly a Confucian society that believes in harmony, in authority, and it is with this background that it accepts, I think broadly, the role of the Chinese Communist party. I mean, the idea that we have that if you don’t vote at the local ballot box, that is, if you are not a Jeffersonian liberal, then you are a savage, belies the fact that China has a 4,000-year history which has these characteristics about it."

"(On rebuilding relationships with Beijing) At least give it respect. What the Chinese want, I think, is respect for what they’ve created. Our central proposition should be that the rise of China is entirely valid. What the Chinese want is acknowledgement of the validity of what they have done and what they have created: the legitimacy of the rise of China from its colonial past and from poverty."

"Taiwan is not a vital Australian interest. We have no alliance with Taipei. There is no piece of paper sitting in Canberra which has an alliance with Taipei. We do not recognise it as a sovereign state – we’ve always seen it as a part of China... My view is Australia should not be drawn into a military engagement over Taiwan, US-sponsored or otherwise..."

"Never get between a Premier and a bucket of money."

"Between 1999 and 2004 there was no investment in Australia, it all went into housing and consumption all borrowed on the current account. When Peter Costello runs around saying, 'Oh we've paid off the debt,' it's like the pea and thimble trick. The Government debt or the massive private debt abroad? It's continuing to grow."

"[Australian Reserve Bank] Governor MacFarlane said recently when Paul Volcker broke the back of American inflation it's regarded as the policy triumph of the Western world. When I broke the back of Australian inflation they say, "Oh, you're the fellow that put the interest rates up." Am I not the same fellow that gave them the 15 years of good growth and high wealth that came from it?"

"You just can't have a position where some pumped up bunyip potentate dismisses an elected government."

"I mean (blowing lips), I mean he's going Mr Speaker, Mr Speaker, he's going troppo, he's going troppo, he's more to be pitied than despised, he's simply going troppo."

"We have heard often since the last election the mantra that Australia doesn’t have to choose between our history and our geography. It appears again in the Howard government’s recently released White Paper on foreign policy. But just think about that assertion for a minute. What could it possibly mean? No choice we can make as a nation lies between our history and our geography. We can hardly change either of them. They are immutable. The only choice we can make as a nation is the choice about our future."

"Paul Keating ‘liked to say’, Professor Huntington asserts confidently, that I was going to change Australia from being ‘“the odd man out to the odd man in” in Asia’. Despite Professor Huntington’s authoritative quotation marks, I liked to say no such thing, and I never did. What I did say, and many times, was that Australia was not Asian or European or American or anything except Australian. This is what history and geography have delivered us. It is the only option we have and one which we have every reason to celebrate."

"In the end it's the big picture which changes nations and whatever our opponents may say, Australia's changed inexorably for good, for the better."

"By the year 2000 we should be able to say that we have learned to live securely, in peace and mutual prosperity among our Asian and Pacific neighbours. We will not be cut off from our British and European cultures and traditions or from those economies. On the contrary, the more engaged we are economically and politically with the region around us, the more value and relevance we bring to those old relationships. Far from putting our identity at risk, our relationships with the region will energise it."

"We will not adopt the fantastic hypocrisy of modern conservatism which preaches the values of families and communities, while conducting a direct assault on them through reduced wages and conditions and job security."

"A familiar question for Australians is how much we are a product of our circumstances, and how much we are what we have made ourselves to be. In truth, by the act of migration the country was made: by that voluntary act and by the emigrants' ambitions it was built."

"This society of ours is better than the United States. It’s more even, it’s more fair, we’ve had a 50% increase in real income in the last 20 years. Median America has had zero, zero... We don’t shoot our children in schools and if they were to be shot we’d take the guns off the people who shot them. The Americans do not do this... The idea that… we are some sort of subordinate outfit that has to get a signal from abroad before we think of ours is a complete denial of everything we have created here."

"John Howard turned the prime ministership into something like a state police minister. He's at the scene of every crime, twice a day on radio, the guy did no thinking."

"The dogs may bark but the caravan moves on."