JOHN MCCAIN AND THE NEOCON GLOBAL MAYHEM AGENDA

February 13, 2008 at 3:31 pm | Posted in Globalization, History, Israel, Judaica, Middle East, Palestine, Zionism | Leave a comment

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John McCain as Neocon and

the “world mayhem-ization”

business

Robert Kagan, a senior associate at the Carnegie Endowment for International Peace and transatlantic fellow at the German Marshall Fund, writes a monthly column for The Washington Post. His latest book is “Dangerous Nation,” a history of American foreign policy. He has been advising John McCain’s presidential campaign.

Robert Kagan’s brother Fred invented the “surge”. Donald Kagan, their father, is a famous neocon professor at Yale.

These are part of the neocon team of far-right de facto Israeli agents who want permanent warfare throughout the world to consolidate their hold over Washington policy and to help Israel dominate the Middle East.

The neocon/Zionist alliance wants the world to be governed by three endless civil wars:

  1. The West against the Muslims and Arabs. (implement the “clash of civilizations” on a global scale)

  1. Hamas versus Fatah. (Hamas was partly formed via Israeli agents in order to bring about a deadly quarrel among Palestinians which is what happened)

  1. Sunnis versus Shiites throughout the Middle East. (the Iraq war is supposed to make Iraq the “hub” of this havoc.)

The neocon/Zionist alliance is in the “world mayhem-ization” business and now that Giuliani is out of the presidential race, McCain is their “horse.”

John McCain as Neocon and the “world mayhem-ization” business

BANK FOR INTERNATIONAL SETTLEMENTS BIS REVIEW NO. 16 2008: PHILIPPINES

February 13, 2008 at 1:04 pm | Posted in Asia, Economics, Financial, Globalization, Research | Leave a comment

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BIS Review

Bank for International Settlements

BIS Review No 16 available

Press, Service (Press.Service@bis.org)

Wed 2/13/08

Publications, Service (Publications@bis.org)

Please find BIS Review No 16 attached as an Adobe Acrobat (PDF) file.

Alternatively, you can access this BIS Review on the Bank for International Settlements’ website by clicking on http://www.bis.org/review/index.htm.

What’s included?

BIS Review No 16 (13 February 2008)

Nicholas C Garganas: The ageing of Europe’s population: consequences and reforms – with particular reference to Greece

Amando M Tetangco, Jr: Current economic issues in the Philippines

Amando M Tetangco, Jr: The Philippines – macroeconomic outlook for 2008

Yves Mersch: The Luxembourg experience, resistance to reform and main avenues for change in Europe

Lars Nyberg: Cash and payments – what lies ahead?

________________________________

please e-mail press.service@bis.org.

BIS Review

Bank for International Settlements

BIS Review No 16 available

Press, Service (Press.Service@bis.org)

Publications, Service (Publications@bis.org)

Wed 2/13/08

QUESNAY’S TABLEAU ECONOMIQUE: PRECURSOR OF INPUT-OUTPUT

February 13, 2008 at 11:52 am | Posted in Economics, Financial, Globalization, History | Leave a comment

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Physiocrats

The physiocrats were a group of economists who believed that the wealth of nations was derived solely from the value of land agriculture or land development. Their use of the term laissez faire meant that the only legitimate form of government revenue derived from the value of land. Their theories originated in France and were most popular during the second half of the 18th century.

Physiocracy is perhaps the first well developed theory of economics. The movement was particularly dominated by Anne-Robert-Jacques Turgot (1727–1781) and François Quesnay (1694–1774). It immediately preceded the first modern school, classical economics, which began with the publication of Adam Smith’s The Wealth of Nations in 1776.

The most significant contribution of the physiocrats was their emphasis on productive work as the source of national wealth. This is in contrast to earlier schools, in particular mercantilism, which often focused on the ruler’s wealth, accumulation of gold or the balance of trade. A chief weakness from the viewpoint of modern economics is that they only considered agricultural labor to be valuable. Physiocrats viewed the production of goods and services as consumption of the agricultural surplus, while modern economists consider these to be productive activities which add to national income.

Historian David B. Danbom explains, “The Physiocrats damned cities for their artificiality and praised more natural styles of living. They celebrated farmers.” They called themselves économistes, but are generally referred to as physiocrats in order to distinguish them from the many schools of economic thought that followed them. Physiocrat is derived from the Greek for “Government of Nature”.

The Physiocrats identified three classes of the economy: the “productive” class (agricultural laborers and farmers), the “sterile” class (industrial laborers, artisans and merchants) and the “proprietor” class (who appropriated the net product as rents). Incomes flowed from sector to sector, and thus class to class. A “natural state” of the economy emerged when these income flows were in a state of “balance”, i.e. where no sector expanded and none contracted. Once the “natural state” was achieved, the economy just continued humming along, reproducing itself indefinitely. The Physiocrats explained their system in the famous Tableau Économique (1758) of François Quesnay.

History

Pierre Le Pesant, sieur de Boisguilbert served as a member of Louis XIV’s local administration of Paris, and wrote pamphlets and booklets on subjects related to his work; taxation, grain trade, and money. Boisguilbert asserted that wealth came from self-interest and markets are connected by money flows (ie. an expense for the buyer is revenue for the producer). Thus he realized that lowering prices in times of shortage – common at the time – was dangerous economically as it served as a disincentive to production. Generally, Boisguilbert advocated less government interference in the grain market, as any activity by the government would give birth to “anticipations” which would prevent the policy from working. An example would be that if the government bought corn abroad, there would be people who realize that there is a likely shortage and would increase their demand, so that prices may rise and a shortage might result. This idea was an early example of advocation for free trade. In anonymously published tracts, Vauban proposed a system known as La dîme royale which suggested major simplification of the French tax code through switching to a relatively flat tax on property and trade. Vauban’s use of statistics marked a noted increase on empirical methods in economics from previous times.

During the periods around the Seven Years’ War between France and England, the physiocracy movement began to grow. For one, several journals appeared, signaling an increasing audience in France to new economic ideas. Among the most important were the Journal OEconomique (1721-1772), which promoted agronomy and rational husbandry and the Journal du commerce (1759-1762), which was heavily influenced by the Irish Richard Cantillon (1680-1734), and two dominated by physiocrats; the Journal de l’agriculture, du commerce et des finances (1765-1774) and the Ephémérides du citoyen (1767–1772 and 1774–1776). Also, Jacques Vincent de Gournay (1712-1759) (who was the Intendant du commerce) brought together a group of young researchers including François Véron Duverger de Forbonnais (1722–1800) and one of the two most famous physicrats, Anne-Robert-Jacques Turgot (1727–81). The second in the pair, François Quesnay (1694–1774), was among those publishing heavily in the journals that were appearing at the time.

Quesnay’s Tableau Économique

The foundation of the Physiocrats’ economic theories was first described in François Quesnay’s Tableau Économique, which was published in 1759. The model Quesnay created consisted of three economic movers. The “Proprietary” class consisted of only landowners. The “Productive” class consisted of all agricultural laborers. The “Sterile” class is made up of artisans and merchants. The flow of production and/or cash between the three classes started with the Proprietary class because they own the land and they buy from both of the other classes. The process has these steps (consult Figure 1).

The farmer produces 1,500 food on land leased from the landlord. Of that 1,500, he retains 600 food to feed himself, his livestock, and any laborers he hires. He sells the remaining 900 in the market for $1 per unit of food. He keeps $300 ($150 for himself, $150 for his laborer) to buy non-farm goods (clothes, household goods, etc) from the merchants and artisans. This produces $600 of net profit, to which Quesnay refers as produit net.

The artisan produces 750 units of crafts. To produce at that level, he needs 300 units of food and 150 units of foreign goods. He also has subsistence need of 150 units of food and 150 units of crafts to keep himself alive during the year. The total is 450 units of food, 150 units of crafts, and 150 units of foreign goods. He buys $450 of food from the farmer and $150 of goods from the merchant, and he sells 600 units of crafts at the market for $600. Because the artisan must use the cash he made selling his crafts to buy raw materials for the next year’s production, he has no net profit.

The landlord is only a consumer of food and crafts and produces no product at all. His contribution to the production process is the lease of the land the farmer uses, which costs $600 per year. The landlord uses $300 of the rent to buy food from the farmer in the market and $300 to buy crafts from the artisan. Because he is purely a consumer, Quesnay considers the landlord the prime mover of economic activity. It is his desire to consume which causes him to expend his entire lease income on food and crafts and which provides income to the other classes.

The merchant is the mechanism for exporting food in exchange for foreign imports. The merchant uses the $150 he received from the artisan to buy food from the market, and it is assumed that he takes the food out of the country to exchange it for more foreign goods.

The Tableau shows the reason why the Physiocrats disagreed with Cantillon about exporting food. The economy produces a surplus of food, and neither the farmer nor the artisan can afford to consume more than a subsistence level of food. The landlord is assumed to be consuming at a level of satiation; therefore, he cannot consume any more. Since food cannot be stored easily, it is necessary to sell it to someone who can use it. This is where the merchant provides value.

The merchant is not a source of wealth, however. The Physiocrats believed that “neither industry nor commerce generates wealth.” A “plausible explanation is that the Physiocrats developed their theory in light of the actual situation of the French economy…” France was an absolute monarchy with the land owners constituting 6-8% of the population and owning 50% of the land. (5, p. 859) Agriculture contributes 80% of the country’s wealth, and the non-land owning segment of the population “practices a subsistence agriculture that produces the essential minimum, with virtually all income being absorbed by food requirements.” Additionally, exports consisted mostly of agricultural-based products, e.g. wine. Given the massive effect of agriculture on France’s economy, it was more likely they would develop an economic model that used it to the king’s advantage.

The Physiocrats are at the beginning of the anti-mercantilist movement. Quesnay’s argument against industry and international trade as alternatives to his doctrine is twofold. First, industry produces no gain in wealth; therefore, redirecting labor from agriculture to industry will in effect decrease the nation’s overall wealth. Additionally, population expands to fill available land and food supply; therefore, population must go down if the use of land does not produce food. Second, the basic premise of the Mercantilists is that a country must export more than it imports to gain wealth, but that assumes it has more of a tradeable resource than it needs for internal consumption. France did not have a colony with the ability to produce finished or semi-finished goods like England (i.e. India) or Holland (i.e. North America, Africa, South America). Its main colonial presence was in the Caribbean, southern North America, and southeast Asia, and like France, the colonies had agricultural-based economies. The only good which France had in enough excess to export was food; therefore, international trade based on industrial production would not yield as much wealth.

Quesnay was not anti-industry, however. He was just realistic in his assessment that France was not in good position to incubate a strong industrial market. His argument was that artisans and manufacturers would come to France only in proportion to the size of the internal market for their goods. Quesnay believed “a country should concentrate on manufacturing only to the extent that the local availability of raw materials and suitable labor enabled it to have a cost advantage over its overseas competitors.” Anything above that amount should be purchased through trade.

Characteristics

Individualism and Laissez Faire

The Physiocrats, especially Turgot, believed that self-interest was the motivating reason for each segment of the economy to play its role. Each individual was best suited to determine what goods he wanted and what work would provide him with what he wanted out of life. While a person might labor for the benefit of others, he will work harder for the benefit of himself; however, each person’s needs are being supplied by many other people. The system works best when there is a complementary relationship between one person’s needs and another person’s desires, and trade restrictions place an unnatural barrier to achieving one’s goals.

Private Property

None of the theories concerning the value of land could work without strong legal support for the ownership of private property. Combined with the strong sense of individualism, private property becomes a critical component of the Tableau’s functioning.

Diminishing Returns

Turgot was one of the first to recognize that “successive applications of the variable input will cause the product to grow, first at an increasing rate, later at a diminishing rate until it reaches a maximum” This was a recognition that the productivity gains required to increase national wealth had an ultimate limit, and, therefore, wealth was not infinite.

Investment Capital

Both Quesnay and Anne Robert Jacques Turgot, Baron de Laune recognized that capital was needed by farmers to start the production process, and both were proponents of using some of each year’s profits to increase productivity. Capital was also needed to sustain the laborers while they produced their product. Turgot recognizes that there is opportunity cost and risk involved in using capital for something other than land ownership, and he promotes interest as serving a “strategic function in the economy.”

Notes

Steiner (2003) p62

Why Americans Value Rural Life by David B. Danbom

Steiner (2003) p61

Steiner (2003) p62

Spiegel (1983) p.189

Spiegel (1983) p.189

Charbit and Virmani (2002) p.858

Charbit and Virmani (2002) p.858

Charbit and Virmani (2002) p.858

Charbit and Virmani (2002) p.859

Charbit and Virmani (2002) p.859

Mueller (1978) p.153

Mueller (1978) p.153

Spiegel (1983) p.195

Spiegel (1983) p.196

References

Henry William Spiegel (1983) The Growth of Economic Thought, Revised and Expanded Edition, Duke University Press

Yves Charbit; Arundhati Virmani (2002) The Political Failure of an Economic Theory: Physiocracy, Population, Vol. 57, No. 6. (Nov. – Dec., 2002), pp. 855-883.

A. L. Muller (1978) Quesnay’s Theory of Growth: A Comment, Oxford Economic Papers, New Series, Vol. 30, No. 1., pp. 150-156.

Steiner, Phillippe (2003) Physiocracy and French Pre-Classical Political Economy in eds. Biddle, Jeff E, Davis, Jon B, & Samuels, Warren J. A Companion to the History of Economic Thought. Blackwell Publishing, 2003.

The History of Economic Thought Website, The New School of Social Research. 6 Feb. 2006

Pierre Samuel du Pont de Nemours, a prominent Physiocrat, emigrated to the US and his son founded DuPont, the world’s second biggest chemicals company. In his book la Physiocratie du Pont advocated low tariffs and free trade.

Quesnay’s Tableau Économique

The foundation of the Physiocrats’ economic theories was first described in François Quesnay’s Tableau Économique, which was published in 1759.

JAPAN CONSUMER CONFIDENCE

February 13, 2008 at 5:51 am | Posted in Economics, Financial, Japan, Research | Leave a comment

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GOVERNMENT OF JAPAN

Economic and Social Research

Institute (ESRI)

CABINET OFFICE

Monthly Consumer Confidence

Survey Jan, 2008

esri37.gj@cao.go.jp

Wed 2/13/08

esri37.gj@cao.go.jp

‘What’s New’ E-mail Service from ESRI, CAO

Japan Feb. 13th, 2008

‘Monthly Consumer Confidence Survey

covering all of Japan (Summary) Jan, 2008′

was released at 14:00 (JST) on Feb. 13th.

http://www.esri.cao.go.jp/en/stat/shouhi/shouhi-e.html

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Monthly Consumer Confidence Survey Jan, 2008

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‘What’s New’ E-mail Service

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Feb. 13th, 2008

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Wed 2/13/08

INDIA SMALL ENTERPRISES

February 13, 2008 at 5:05 am | Posted in Asia, Economics, Financial, India, Third World | Leave a comment

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Small Enterprises Finance Centre

Institute for Financial

Management and Research (IFMR)

24 Kothari Road, Nungambakkam

Chennai 600 034, India

Phone: +91 44 28273801 | Fax : +91 44 28279208

Email: sefc@IFMR.ac.in | www.ifmr.ac.in/sefc

THE SMALL ENTERPRISE FINANCE CENTRE

The SEFC was founded in March, 2006 to advance the research and practice of small enterprise financing and development in India to ultimately develop a vibrant SME sector.

The approach is two-pronged:

Conduct and facilitate systematic, rigorous research projects at the small enterprise level as well as the SME banking level in partnership with banks, financial organizations and NGOs

Offer regular advanced financial training courses for the Indian banking sector in partnership with the Financial Services Volunteer Corps (FSVC).

Small Enterprises in India: Facts and Figures

CURRENT SCENARIO ( 2005-06 )

Total Number of SSI Units

12341665

Number of Registered Units

18070807

Number of Unregistered Units

10470858

Number of Women Enterprises

1063721

Women managed enterprises

995141

Growth Rate of SSI sector (%)

12.32

Total Industrial Sector Growth Rate (%)

8.1

Employment (Lakh persons)

294.91

Total Employment in the Industrial sector (Lakh persons)

1944.44

Production (at current prices) (Rs. Cr.)

497842

Fixed Investment (Cr.)

181423

Total Exports of India (Rs. Cr.)

456417.86

Number of Sick Units (March 2005)

138041

Lakh= 100, 000

Crore= 10, 000, 000

Institute for Financial

Management and Research (IFMR)

 


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