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I think I’ve looked up and had explained to me what the term “inflation” is. The concept has remained a bit of a mystery. Mark Blyth the Scottish-American (Austerity – The History of a Dangerous Idea) economist parsed down the meaning of inflation to this – “too much money chasing not enough goods in an economy”. I like that definition as it sticks easily in the mind. However, without the necessary context, understanding what inflation is remains elusive.
Enter Yanis Varoufakis and his book “Talking to My Daughter About the Economy or, How Capitalism Works – and How it Fails”. This short quote describes how inflation and deflationary pressures work in an economy – he tells a story based on a famous paper by R.A. Radford titled The Economic Organization of a P.O.W. camp (original linked here).
“The Exchange Value of Money
When I was your age I recall hearing a grown-up saying something I could not get my head around. I just did not get it, however hard I tried. Even when I thought I had understood it, I tried to explain it to a friend and realized that I hadn’t. What was it that this grown-up had said? That a one-thousand-drachma note (the currency we had then) cost only twenty drachmas to produce. How can it be worth a thousand dratchmas, I kept wondering, when it only cost twenty.
Maybe you are smarter than I was, but humour me nevertheless as I attempt to explain this puzzle in the context of Radford’s POW camp. Periodically, the Red Cross Would place a few more cigarettes in the prisoners’ packages but keep the quantity of chocolate, tea, and coffee the same. When extra cigarettes arrived, each cigarette now bought less coffee, less chocolate, and less tea.
Why?
Since overall a larger number of cigarettes now corresponded to the same amount coffee and tea, each individual cigarette corresponded to less coffee and less tea. The opposite also held true: the fewer cigarettes there were in comparison to the other goods that the Red Cross placed in the packages, the great the exchange value, or purchasing power, of each cigarette. In short, the purchasing power of a unit of currency has nothing to do with how much it costs to produce but, rather, its relative abundance or scarcity.
Imagine that a prisoner has been hoarding his cigarettes in order to make a large purchase when suddenly the Red Cross sends tons of cigarettes to the captives. Suddenly, the exchange value or his cigarettes drops, and his parsimony and abstinence have been to no avail.
In this way we see how having access to a currency lubricates transactions to no end, helping the economy move more commodities more quickly. On the other hand, for a currency to function it requires trust and faith: the trust that everyone will continue to accept it in return for any commodity, which is in turn based on faith that the currency’s exchange value will be maintained. It is no coincidence that in your second language, Greek, the word for “coin: (nomisma) straddles the verb “to think” (nomizo) and the noun for “law” (nomos). Indeed, what gives value to coins and paper money is the legal obligation to accept them across the realm and the belief that they are and will remain valuable.
One night Allied Bombers hammered the area where the camp was located. The bombs landed closer and closer, some falling in the camp itself. All night long the prisoners wondered whether they would live to see daybreak. The next day the exchange value of cigarettes had gone through the roof! Why? Because over the course of that endless night, surrounded by exploding bombs and consumed by anxiety, the prisoners had smoked cigarette after cigarette. In the morning the total number of cigarettes had shrunk dramatically in relation to the other goods. If previously five cigarettes had been needed to buy one chocolate bar, now only one cigarette was needed to buy that same bar.
In short, the bombardment had caused what is known as price deflation – a decrease in all prices as a result of a reduction of the quantity of money in relation to all other goods. The opposite, a genderal increase in prices as a larger quantity of money in the overall system, is known as price inflation.”
–Talking to My Daughter About the Economy or, How Capitalism Works – and How It Fails. Yanis Varoufakis, pp 142 -144.
So, this is how I increased my knowledge of basic economic theory and what I think is a great heuristic tool if you happen to be trying to explain what inflation is and how it works in an economy. I will need to reread both Blyth’s ( his writing is for the layperson but remains quite dense and meaty, a slow but rewarding go) and Varoufakis’s books again as both were invaluable to understand how our economy works.
Is a sub gig worth the health of your family?
That main question that has been going through my head as of late, since school has started. I’ve been very lucky to be able to attend schools I know that also happen to have very stringent health protocols. But I won’t go somewhere new, where I don’t know the people or the lay of the land. Even with the familiarity and risk reduction, the chance to be infected isn’t zero.
The other side of the coin is, of course, I’m a big fan of eating and keeping up on the bills that, through some dark magic, continue to arrive and require my fiscal involvement even when deep into a world pandemic.
Being Canadian, I had access to the CERB, which while available provided income to keep the home-fires going and remain safely at home with minimal exposure. I haven’t been more proud of a Canadian Federal government for taking such bold steps to keep its population safe.
Yet, as the second wave comes, the fiscal reality of the government’s finances may dictate that there will be no relief available. It is very possible that the schools, and thus my employment, may become unavailable for an undetermined length of time.
So then given the uncertainty of future work should I take more risks and work now because no work may be the only option open in the future – but if I catch the virus now I may be out for months recuperating with added negative of possibly killing my vulnerable family members.
This sort of risk drenched future is hell on risk averse individuals such as myself.
I’ll do my best and hope that it is enough for whatever scenario we happen to fall into.
*sigh*
I hope the Edmonton Public School Board takes notice –
“SS: What health and safety measures are your school district and you taking for the reopening of school?
MKS: As of this writing, our district has delayed its start by 2 1/2 weeks for faculty and 4 weeks for students. Required temperature checks daily for staff and students (if temperature exceeds 100.4 degrees Fahrenheit, individual must go home). Designated room for sick students.
Students will report half Mon and Wed, the other half, Tues and Thurs, and alternate Fridays. Masks are required for adults and for students in grades 3 thru 12. No visitors on campus. At my high school, three lunches, I believe, in a partitioned cafeteria. Scheduled bathroom breaks. Staggered class change. Reserved seating on the school buses. Deep cleaning of facilities each day (evening?), with teachers cleaning their classrooms before school, after school, and between classes. (To limit movement and cleaning, students will follow a block-styled schedule of 110 minutes per class for three classes and 53 minutes for the last class of the day. Desks 6 feet apart; teacher has a designated space and is encouraged to move around room as little as possible. District is also providing Chromebooks to all students, and teachers will be using Google Classroom as the principal teaching and learning platform.
I have also purchased two HEPA air filtration machines for my classroom. I also have purchased scrubs (allowed this year for teachers because scrubs are easy to wash), goggles (2 pair), face shields (2), and masks (multiple). The school will also provide all of these to staff (except goggles), as well as gloves and gowns for staff and masks for students (if needed). The school will provide cleaning supplies and hand sanitizer for staff and students.”
Will it be enough? Hard to say.
In Alberta our current government is off the rails. They are enacting austerity programs that are targeting the public sectors of our society during a pandemic. The quarrel with Alberta doctors over their working conditions during this exceptional time exemplifies the negligence of this UCP government.
This same radical right United Conservative government laid off thousands of Educational Assistants and support staff during the pandemic as well. The pattern is clear. The UCP are starving each of the public sectors of our society of the funds and people necessary for them to function efficiently. The next round of bullshit will be point out how these same gutted public sectors are not doing a good job and therefore must be replaced with private, more efficient, systems of delivery.
The UCP of Alberta are taking plays from the very first page Disaster Capitalism’s playbook. They are pushing through reactionary anti-education, anti-worker, anti-public health, reforms in the legislator at a marathon rate with essentially no debate. Albertan’s will be waking up to a very different set of ground rules in society, and most of said rules will be making their lives marginally worse.
Speaking of marginally worse, the contract for Alberta Teachers is up on August 30th. There will be no joy at the negotiating table this year, let me assure you. Austerity will be the only option – while we generously fund pipelines to nowhere – for Alberta Teachers.
Plastic shields for students? Netherlands is doing it. Alberta is not.
Concomitantly, Teachers will be asked to perform their duties under conditions that are directly hazardous to not only their students’ health, but theirs and their families as well. No additional funding for pandemic measures is on the table for the opening of the school year. No PPE, no classroom caps of 15, no additional cleaning personal or cleaning routines will be available. Teachers will be expected to take up the pandemic slack, as do ‘the best they can’ with the dangerous circumstances mandated by the UCP government.
This is unacceptable. Teachers should not have to unreasonably risk their lives and the lives of their families working in unsafe conditions. Is it just to expect teachers to be responsible for the death of their aging parents, or young children because of the government’s mandated unsafe working conditions in the schools?
Alberta teachers will not get, as in the previous agreements, another cent more in wages. Cost of living be damned. We expect that, especially with this government that is so completely beholden to private sector; especially Oil and Gas. The continued existence of the white elephant Energy War Room more than proves this egregious bias, the fact that it continues to exist during the pandemic will be one of the darker stains on this government’s legacy.
Wages aside, it is not reasonable for Alberta Teachers to risk their lives (and their families) to perform their duties. We are being set up to be the at the very nexus of the second wave of the Covid-19 pandemic. The situation, as currently mandated, is a untenable situation.
We must seriously consider a strike because our government seems unwilling or unable to adequately protect the students and teachers of this province. We should also consider coordinating with healthcare professionals because this government is serious about dismantling our public systems, and we need to present a united front that is too big to fail and cannot be punitively,and in piecemeal, legislated back to work (which will happen).
We let this happen at the ballot box, and now the grave consequences of voting in a American style government with a unhealthy privatization fetish, are here. We cannot sit back throw up our hands and somehow think that students and teachers dying at school because of the malfeasance of the government is in anyway okay. We are better than that as a teachers and as Albertans.
Signed,
A very concerned Alberta School Teacher.
@albertateachers
@rachelnotley
@albertandp
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@edmontonjournal
@adrianalagrange
The second wave of the pandemic now has a date. The beginning of the school year.
“The Alberta government is targeting a return to “near-normal” conditions with students returning to classrooms across the province for the beginning of the 2020-21 school year, Education Minister Adriana LaGrange says.
“Our goal is to get us back to normal learning as soon as possible,” LaGrange said Wednesday at news conference. “We are targeting a return to new-normal operations with some health measures in place.”
LaGrange laid out three scenarios that have been part of the planning for weeks now.
The first scenario would see near-normal operations resume with students returning to daily in-school classes with some health measures…”
Wow. We’re just gonna throw the kids back into the mix.
“Jason Schilling, president of the Alberta Teachers’ Association, said there are outstanding questions about safety.
“If you have a look at staffing as well, as teachers can’t spend the day cleaning their classrooms because they’ll be busy teaching, and if we have students that are in cohorts that are expected to be socially distanced, how is that going to work in some of our classrooms where we have 30 or 40 students? And are they going to split those grades and then hire more teachers?” he said.
“Unbelievable to me that we would move forward on a plan to restart school without making sure that it is adequately funded and that everything that needs to be in place for students, teachers and staff and the broader community, for that matter, are safe.”
Oh, and masks won’t be mandatory.
“LaGrange says wearing masks to school will not be mandated for either staff or students.
“From what Dr. [Deena] Hinshaw has been advising us, the data shows that particularly in young children that it is not something that is required.”
Students or staff who choose to wear a mask may do so, but there is no standalone funding for this type of thing.”
Yep. Looking forward to the second wave.
“Unless someone can answer the simple questions that immediately arise in the mind of any reasonable person when claims about “theory” and “philosophy” are raised, I’ll keep to work that seems to me sensible and enlightening, and to people who are interested in understanding and changing the world.
Johnb made the point that “plain language is not enough when the frame of reference is not available to the listener”; correct and important. But the right reaction is not to resort to obscure and needlessly complex verbiage and posturing about non-existent “theories.” Rather, it is to ask the listener to question the frame of reference that he/she is accepting, and to suggest alternatives that might be considered, all in plain language. I’ve never found that a problem when I speak to people lacking much or sometimes any formal education, though it’s true that it tends to become harder as you move up the educational ladder, so that indoctrination is much deeper, and the self-selection for obedience that is a good part of elite education has taken its toll. Johnb says that outside of circles like this forum, “to the rest of the country, he’s incomprehensible” (“he” being me). That’s absolutely counter to my rather ample experience, with all sorts of audiences. Rather, my experience is what I just described. The incomprehensibility roughly corresponds to the educational level. Take, say, talk radio. I’m on a fair amount, and it’s usually pretty easy to guess from accents, etc., what kind of audience it is. I’ve repeatedly found that when the audience is mostly poor and less educated, I can skip lots of the background and “frame of reference” issues because it’s already obvious and taken for granted by everyone, and can proceed to matters that occupy all of us. With more educated audiences, that’s much harder; it’s necessary to disentangle lots of ideological constructions.
It’s certainly true that lots of people can’t read the books I write. That’s not because the ideas or language are complicated — we have no problems in informal discussion on exactly the same points, and even in the same words. The reasons are different, maybe partly the fault of my writing style, partly the result of the need (which I feel, at least) to present pretty heavy documentation, which makes it tough reading. For these reasons, a number of people have taken pretty much the same material, often the very same words, and put them in pamphlet form and the like. No one seems to have much problem — though again, reviewers in the Times Literary Supplement or professional academic journals don’t have a clue as to what it’s about, quite commonly; sometimes it’s pretty comical.
A final point, something I’ve written about elsewhere (e.g., in a discussion in Z papers, and the last chapter of “Year 501”). There has been a striking change in the behavior of the intellectual class in recent years. The left intellectuals who 60 years ago would have been teaching in working class schools, writing books like “mathematics for the millions” (which made mathematics intelligible to millions of people), participating in and speaking for popular organizations, etc., are now largely disengaged from such activities, and although quick to tell us that they are far more radical than thou, are not to be found, it seems, when there is such an obvious and growing need and even explicit request for the work they could do out there in the world of people with live problems and concerns. That’s not a small problem. This country, right now, is in a very strange and ominous state. People are frightened, angry, disillusioned, skeptical, confused. That’s an organizer’s dream, as I once heard Mike say. It’s also fertile ground for demagogues and fanatics, who can (and in fact already do) rally substantial popular support with messages that are not unfamiliar from their predecessors in somewhat similar circumstances. We know where it has led in the past; it could again. There’s a huge gap that once was at least partially filled by left intellectuals willing to engage with the general public and their problems. It has ominous implications, in my opinion.”
Source: http://www.mrbauld.com/chomsky1.html [accessed 30 Dec 2008]
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