May 26, 2004

On the bezzle

Posted by Daniel
John Kay has a pretty decent column in the FT today. The actual message will eb pretty familiar to anyone who’s been folowing the Cassandra-like wailings of people like Wynne Godley and (on some occasions) me about the unusustainability of the US current account deficit, but he has some quality jokes in it. In particular, he recruits JK Galbraith’s concept of “the bezzle” to illustrate his thesis about overconsumption and asset price inflation:
John Kenneth Galbraith’s greatest contribution to economics is the concept of the bezzle - the increment to wealth that occurs during the magic interval when a confidence trickster knows he has the money he has appropriated but the victim does not understand that he has lost it. The gross national bezzle has never been larger than in the past decade.
Posted on May 26, 2004 10:39 AM UTC
Comments

Try explaining this to people who think playing the lottery is a sound financial investment for their retirement years.

Posted by Keith · May 26, 2004 02:16 PM

Obligatory Crooked Timber caveat: since we do not offer financial advice, we have no official opinion on the subject of whether playing the lottery is a good investment for your retirement years [1]

[1]actually, UK premium bonds are a lottery and a good investment for retirees, but they have many characteristics which make them entirely atypical of lotteries.

Posted by dsquared · May 26, 2004 02:35 PM

> The gross national bezzle has never been larger
> than in the past decade.

While the analysis offered is in line with my own thoughts, I have to combine this post with the previous ones on reactions to paradoxes. Because the idea that a “confidence game” can go on against 300 million actors for more than 10 years, though 3 Presidental administrations and almost 2 full business cycles, shoudl be enough to raise a warning flag.

Cranky

Posted by Cranky Observer · May 26, 2004 03:31 PM

Because the idea that a “confidence game” can go on against 300 million actors for more than 10 years, though 3 Presidental administrations and almost 2 full business cycles, shoudl be enough to raise a warning flag. </>

You wouldn’t have thought that the most educated and civilized nation on earth could be talked into mobilising en masse for the purpose of genocide, but it happened.

Posted by dsquared · May 26, 2004 03:37 PM

Cranky: 51% of the people, all of the time.

Mars!

Breast!

The “marketplace of ideas” places little value on ugly truths, putative changes of ideology in the executive notwithstanding…

Posted by Extradite the Neocons · May 26, 2004 08:18 PM

The Bush administration has a habit of backloading a lot of its policies, notably the tax cuts. When the effect of the tax cuts hits, we will be facing a fait accompli. Recently people have been talking about how the Right has not really won the battle for people’s minds, e.g. regarding Social Security. But they HAVE rewritten the law.

Posted by Zizka · May 26, 2004 09:46 PM

Another good John Kay column on the culture of equivocation:
http://www.johnkay.com/political/320

Posted by JamesW · May 27, 2004 01:58 PM
Followups

This discussion has been closed. Thanks to everyone who contributed.