Mangled Thoughts

Their treacherous lobbying for Co2 taxation. Sadly, Professor Sinclair Davidson has found he cannot publish his formidable, learned paper demonstrating why, as Davidson claims, Mr. Jackson is wrong in his assessment of the Centre for Independent Studies’ position. It is sad because, in, truth, he cannot do it.

As disappointing as it is, let’s offer Sinclair Davidson another chance to undo the damage he is also responsible for. Professor Sinclair Davidson can defend what is also his assumption, the fiction of perfect competition. Mind, this is trickier than the above challenge Davidson has so miserably failed. Still, it will make for an interesting read, unless he decides to chicken out on this challenge too. We’ll give him until 2.00pm today; this should be time enough for him to publish on the internet a summary defence paper.

In the meantime…

It is pertinent to mention Dr. Frank Shostak, who held a University chair in economics, and now works in enterprise. This is not only to remind inclair Davidson that he can refer to Dr. Shostak for his assessment of Jackson’s work in economics and the calibre of Jackson as an economist.

Listening to Parliament last week, a peculiar reference was made to Sinclair. Here it is:

“Mr HARTSUYKER (Cowper) (3.57 p.m.)—I certainly welcome the opportunity to speak on this matter of public importance. The issue of Fuelwatch and GROCERYchoice does raise important questions about the way in which the ACCC has conducted its affairs under the Rudd Labor government. Is it an organisation acting in the public good, or is it acting at the whim of the hollow men who lurk in the backrooms of the Prime Minister’s office? Has the ACCC attempted to provide a quick political fix for the Prime Minister in relation to his promises on fuel prices, grocery prices and the cost of living?

“How then has the ACCC come to recommend Fuelwatch? Where is this new and compelling evidence that has come to hand which can justify this change in position by the ACCC with regard to Fuelwatch? The reality is that there is no such evidence. The modelling conducted by the ACCC has been criticised as being flawed not by members on this side of the House in isolation but by organisations such as Access Economics, Concept Economics, Professor Sinclair Davidson, Professor Frank Zumbo and Professor Don Harding. Professor Harding said of Fuelwatch:

“I find that the ACCC applied the wrong tests to the wrong variable. Specifically, they studied the nominal retail margin when economic theory suggests that the analysis of anything but the real retail margin to producers creates a mis-specified model inconsistent with the econometric assumptions used.

“Mr Henry Ergas, Chairman of Concept Economics, said in relation to the ACCC modelling—

“I have not come across another instance in Australian public policy since the 1970s where a significant issue such as this has been said to be determined on the basis of modelling and the results of that modelling have not been available to the public.

“We also note that the ACCC failed to correct for changes in transport costs over the period. These are likely to have increased prices on the east coast relative to those in Perth. We are surprised that the internal peer review and the peer review by Treasury did not uncover and correct these points.”

In case readers have missed the point to the above, the charge against fuel suppliers is that they are running a ‘cartel’. The ACCC is out to break it up. “Fuel watch” is Rudd’s answer to anti-market monopolistic actions by fuel companies.

The problem is, the charge is false. Secondly, the Opposition, being economic illiterates, and advised by illiterates and incompetents, are failing to attack the Cabinet’s actions, from sound economic theory. Observing, only governments can impose monopolies, and the attempt to break up fuel companies does not deliver cheaper fuel, it breaks up the economic basis upon which they can deliver fuel at the lowest prices they can achieve. In short, they are failing to do what can be done, by the competent:

Eviscerate Rudd, his ministers, and the ACCC for seeking to wreak extensive economic damage. Secondly, they are failing to defend free markets. Thirdly, they are only reinforcing the capacity of government to cause great damage to markets, rendering Australians worse off, and incurring great dangers as the Co2 tax shows in appalling force.

One of the false assumptions crippling Liberal MPs is the fiction of Perfect Competition, which defines falsely monopoly as a function of market concentration, which also for the CIS, IPA, and HR Nicholls Society, is the definition of a competitive market. It is not. The test of a competitive market is: is it free, that it is without barriers to entry? The only body capable of imposing barriers in a free market is government.

Next, using econometrics as an argument against the Cabinet and the ACCC fails. Indeed, I challenge Davidson to debate this with a Professor who did teach econometrics but rejected it as false. For now, here is a devestating paper by Dr. Frank Shostak, published today on Brookesnews:

Why econometric forecasting fails , Dr Frank Shostak

To check how bad the pragmatic Right is - and it would be entertainging to read Davidson refuting this, as well as Dr. Frank Shostak’s paper:

The monopoly myth and competition

There it is, another demonstration of how the idly camotose Right are causing great damage. How can the Liberal Party do otherwise but sap genuine Liberal principles when:

- Immediate advisers to MPs are lawyers, graduates in oracular studies euphemistically called politics, and family inmates. Lawyers according to the ‘pragmatic’ “Right” are each multiple Nobel Prize Winners in economics, science, history and philosophy. Why, there is no greater eminence than MP and ‘watermelon red” Reg Hunt (Gippsland), who studied law and this, as he declared on Radio, made him a distinguished physicist. It’s bad enough that, before Hunt (and Helen Kroger - the female freezer) entered Parliament, the Party was already stuffed by the likes of Coonan, Minchin, Fifield, Julie Bishop, the Kemps, Nelson, and Turnbull.

- The Centre for Independent Studies, Institute of Public Affairs, and the HR Nicholls Society. These are not free market free tanks. They have discredited the fight for free markets, and genuine Liberal principles in general. Not only this, but have helped to nearly destroy the Liberal Party, which is the subject of the next item to be posted soon after this item.

How can that lot soundly advise the Party when their assumptions in economics is a tissue of fallacies built on the quicksand of a fiction called ‘perfect competition’? It is worse than this because, along with their general thuggery, these are the reasons the hard Left love them, the reasons why they have handed victory after victory to the ACTU, the ALP and the diseased Left.

The worst attack is an inept defence. The trouble is, the hubristic “Right’s” notion of defence is not merely non-existent. This is why they have never hurt the Left, oh I suppose they have by tickling the Left with a feather duster and this is painful. What they put up is so fatally bad that the only excuse for their output is that they have no brains, which means what they are in need of, corrective surgery, is impossible.

As for their thuggery, this lot are scared of the hard Left, and it shows - they continually crawl to them. Instead, they smear and attack genuine Liberals, and do their best at damaging the professional reputations of genuine Liberals, and it is not only fine economists who have been the targets of this thuggery. What is very strange is, the Right then whines, loudly, when genuine Liberals engage in a civil criticism of errors in economics they make (they really are in many respects no better than spoiled, narcissistic, delinquent brats; to call them cowards is an exaggeration, it credits them with being brave). They wail even louder when confronted by Liberals prepared to fight their rubbish.

Genuine Liberal Party members, for example, are abused every day by this lot, and numbers have been subjected to the “Right’s” love of bashing up genuine members. This is why, for example, the Victorian Division is stone dead, a carcass decaying rapidly.