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What We Read Today 10 September 2017

Econintersect: Every day our editors collect the most interesting things they find from around the internet and present a summary "reading list" which will include very brief summaries (and sometimes longer ones) of why each item has gotten our attention. Suggestions from readers for "reading list" items are gratefully reviewed, although sometimes space limits the number included.

This feature is published every day late afternoon New York time. For early morning review of headlines see "The Early Bird" published every day in the early am at GEI News (membership not required for access to "The Early Bird".).

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Topics today include:

  • People Don’t Actually Want Equality. They Want Fairness.‚Äč

  • Time for pragmatism, not panic, for the electricity market

  • The economics of ticket scalping

  • Massive sunspots and huge solar flares mean unexpected space weather for Earth

  • Hurricane Irma: storm makes landfall near Naples with life-threatening surges

  • Jim Mattis just out-Trumped Trump on North Korea

  • Hillary Clinton: Trump inaugural speech was 'cry from the white nationalist gut'

  • House Conservative: GOP Gave Trump No Choice But to Cut Bad Deal

  • China Struggles to Control Yuan

  • How market forces and weakened institutions are keeping our wages low

  • Mexico earthquake: Rescue efforts continue as death toll rises

  • And More

Articles about events, conflicts and disease around the world

Global

  • Massive sunspots and huge solar flares mean unexpected space weather for Earth (The Conversation)  If you still have your solar viewing glasses from the eclipse, now is a good time to slap them on and look up at the sun. You’ll see two big dark areas visible on our star. These massive sunspots are regions of intense and complicated magnetic fields that can produce solar flares – bursts of high-energy radiation. You can just make them out with solar viewing glasses, but they’re better viewed through a solar telescope.  These two huge sunspots are currently causing quite a bit of consternation and interest. The solar storms they’ve sent toward Earth may affect communications and other technologies like GPS and radio signals. They’re causing amazing displays of the Northern and Southern Lights. And space weather scientists like us are excited because we wouldn’t normally expect this much activity from the sun at the moment.  We are at a period of a "solar minimum".

U.S.

  • Hurricane Irma: storm makes landfall near Naples with life-threatening surges (The Guardian)  President Donald Trump has declared a major disaster in Floridaand ordered federal funds to help the state and NGO recovery work that will begin once the storm allows.  In a statement, the White House said assistance can include “grants for temporary housing and home repairs, low-cost loans to cover uninsured property losses, and other programs to help individuals and business owners recover from the effects of the disaster.”  Scene below shows residents walking on land that is noemally under Tampa Bay.

  •  Jim Mattis just out-Trumped Trump on North Korea (Business Insider)  US Defense Secretary James Mattis delivered a pithy response on Sunday to North Korea's nuclear test earlier that day.  The probability of a US strike on North Korea has clearly risen.  This was the core of the statement:

"Any threat to the United States or its territories including Guam or our allies will be met with a massive military response, a response both effective and overwhelming."

China

Click for large image.
yuan.2017.sep.11

Australia

  • How market forces and weakened institutions are keeping our wages low (The Conversation)  As economist and philosopher Adam Smith noted, the income workers require to survive sets what’s called a “market floor” for wages - the lowest acceptable limit. Rates of profit in the best performing firms set the upper limit, as Australia’s executive class has shown very clearly for over three decades now. What rates actually prevail within these very broad limits are determined by institutional forces – in Australia, the award system of minimum wages and unions collective bargaining rights.

Over the course of the twentieth century Australia devised a remarkable set of institutions to manage the complex problem of wages and labour standards. It’s time we built on what little remains of that legacy to remedy low wage growth.

Building on these institutions doesn’t mean restoring what was. New policies need to engage with new realities. Even former enthusiastic supporters for reducing labour standards and wages such as the IMF now recognise growth needs to be inclusive if it is to sustainable.

It’s much easier to destroy institutions that deliver fair pay than build them. Australia found ways of achieving fair pay over the course of the twentieth century - it can to so again.

Mexico

Other Scientific, Health, Political, Economics, and Business Items of Note - plus Miscellanea

  • People Don’t Actually Want Equality. They Want Fairness. (Evonomics)  In his just-published book, On Inequality, the philosopher Harry Frankfurt argues that economic equality has no intrinsic value. This is a moral claim, but it’s also a psychological one: Frankfurt suggests that if people take the time to reflect, they’ll realize that inequality isn’t really what’s bothering them.  Fairness is more the issue.  But inequality does have some fundamental pyschological characteristics (overlapping with fairness):

When treats are being distributed, children will complain bitterly if they get less, but are entirely mellow if they get more. Other primates behave similarly. Monkeys enjoy cucumbers and will normally be happy getting one, but if they are handed one after having just seen another monkey getting a grape—which monkeys love—they freak out. The monkey with the grape, on the other hand, is perfectly comfortable with its relative advantage.

  • Time for pragmatism, not panic, for the electricity market (The Conversation)  Very interesting discussion of what happens when cheap but intermittent power (solar and wind) is integrated with expensive but continuous power (fossil fuels and nuclear).

  • The economics of ticket scalping (The Conversation)   Research that suggests people prefer to attend events in a packed-out venue, as opposed to a sparsely attended one. This incentivises event promoters to sell out venues as people’s demand for tickets depends, to some extent, on the demands of others.  There is also the somewhat idealistic idea that fairness stops event promoters from setting prices too high. This is the idea, often voiced in the media, that tickets should end up in the hands of “true fans”.  But there is an argument that ticket scalping actually enhances the total welfare of concert goers and sports fans. Scalpers act to distribute tickets to those who value them the most, or, as economists’ would say, they increase the allocative efficiency of the market.

Secondary markets for tickets allow potential buyers to indicate how much they want to go to the event – their “willingness to pay”. If tickets can only be bought at a single price on a first come first serve basis, then some people who really want to go will be left out. Secondary markets permit these mutually beneficial exchanges to take place.


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