Oh, this is absolutely terrific! I’m thrilled. Go EU!

Research funders from France, the United Kingdom, the Netherlandsand eight other European nations have unveiled a radical open-access initiative that could change the face of science publishing in two years — and which has instantly provoked protest from publishers.

The 11 agencies, who together spend €7.6 billion (US$8.8 billion) in research grants annually, say they will mandate that, from 2020, the scientists they fund must make resulting papers free to read immediately on publication (see ‘Plan S players’). The papers would have a liberal publishing licence that would allow anyone else to download, translate or otherwise reuse the work. “No science should be locked behind paywalls!” says a preamble document that accompanies the pledge, called Plan S, released on 4 September.

https://www.nature.com/articles/d41586-018-06178-7

Found in our garden this morning:

This post happens to be talking about education, but I’m interested more broadly in this view of the tensions inherent to liberal democracy:

Here’s something we don’t talk about nearly enough: schools are simply not in the learning-maximization business. It turns out that parents, taxpayers and politicians call on schools to perform many jobs. At times, there are trade-offs between the educational goals schools are asked to pursue, and educators are forced to make tough choices.

Historian David Labaree has one way of thinking about these conflicting educational goals, which he expands on at length in Someone Has to Fail. For Labaree, there are three competing educational goals that are responsible for creating system-wide tensions:

• democratic equality (“education as a mechanism for producing capable citizens”)
• social efficiency (“education as a mechanism for developing productive workers”)
• social mobility (“education as a way for individuals to reinforce or improve their social position”)

As Labaree tells it, these goals end up in tension all the time. A lot of things that seem like gross ineptitude or organizational dysfunction are really the result of the mutual exclusivity of these goals:

‘These educational goals represent the contradictions embedded in any liberal democracy, contradictions that cannot be resolved without removing either the society’s liberalism or its democracy … We ask it to promote social equality, but we want it to do so in a way that doesn’t threaten individual liberty or private interests. We ask it to promote individual opportunity, but we want it to do so in a way that doesn’t threaten the integrity of the nation or the inefficiency of the economy. As a result, the educational system is an abject failure in achieving any one of its primary social goals … The apparent dysfunctional outcomes of the school system, therefore, are not necessarily the result of bad planning, bad administration, or bad teaching; they are an expression of the contradictions in the liberal democratic mind.’

http://slatestarcodex.com/2018/09/04/acc-entry-does-the-education-system-adequately-serve-advanced-students/

Economic analysis in a technologically-advanced future society, as imagined from 1942, by Robert Heinlein:

Just because you reject one fact with a staggering amount of common sense and scientific evidence behind it doesn’t mean you have to reject all of them – and so it is that Flat Earthers officially accept human-caused climate change.

This week Reddit drew our attention to a tweet from the Flat Earth Society posted back in July, which suggests – as far as the social media managers at the Society are concerned, at least – people can believe in both a Flat Earth and climate change.

Responding to a question about whether Society members believed in climate change, the tweeted reply was this:

“Certainly. It would be nothing short of irresponsible to question something with so much overwhelming evidence behind it, and something that threatens us so directly as a species.”

https://www.sciencealert.com/flat-earthers-understand-climate-change-science-we-are-not-sure-what-to-think

Via

https://wtfeconomy.com/machine-money-and-people-money-29b497eeb9d0

but it’s better than the essay from whence it came.

Apparently stock buybacks, for the sake of enriching the richest, are a major factor in income inequality.

Five years after the official end of the Great Recession, corporate profits are high, and the stock market is booming. Yet most Americans are not sharing in the recovery. While the top 0.1% of income recipients—which include most of the highest-ranking corporate executives—reap almost all the income gains, good jobs keep disappearing, and new employment opportunities tend to be insecure and underpaid. Corporate profitability is not translating into widespread economic prosperity.

The allocation of corporate profits to stock buybacks deserves much of the blame. Consider the 449 companies in the S&P 500 index that were publicly listed from 2003 through 2012. During that period those companies used 54% of their earnings—a total of $2.4 trillion—to buy back their own stock, almost all through purchases on the open market. Dividends absorbed an additional 37% of their earnings. That left very little for investments in productive capabilities or higher incomes for employees.

The buyback wave has gotten so big, in fact, that even shareholders—the presumed beneficiaries of all this corporate largesse—are getting worried. “It concerns us that, in the wake of the financial crisis, many companies have shied away from investing in the future growth of their companies,” Laurence Fink, the chairman and CEO of BlackRock, the world’s largest asset manager, wrote in an open letter to corporate America in March. “Too many companies have cut capital expenditure and even increased debt to boost dividends and increase share buybacks.”

Why are such massive resources being devoted to stock repurchases? Corporate executives give several reasons, which I will discuss later. But none of them has close to the explanatory power of this simple truth: Stock-based instruments make up the majority of their pay, and in the short term buybacks drive up stock prices…

https://hbr.org/2014/09/profits-without-prosperity

The growth of the financial industry has been a boon for its highly-paid managers. According to New York University economist Thomas Philippon, who contributes one of the most striking chapters in Rethinking the Financial Crisis, “total compensation of financial intermediaries (profits, wages, salary and bonuses) as a fraction of GDP is at an all-time high, around 9% of GDP.”

To give those numbers some context, consider that 9 percent of US GDP last year was about $1.4 trillion—an unprecedented windfall for America’s capitalist class. “What does society get in return? Or, in other words, what does the finance industry produce?”

Historically, the unit cost of intermediation has been somewhere between 1.3% and 2.3% of assets. However, this unit cost has been trending upward since 1970 and is now significantly higher than in the past. In other words, the finance industry of 1900 was just as able as the finance industry of 2010 to produce loans, bonds and stocks, and it was certainly doing it more cheaply. This is counter-intuitive, to say the least. How is it possible for today’s finance industry not to be significantly more efficient than the finance industry of John Pierpont Morgan?

The short answer is that Wall Street, for the last thirty years or so, has been skimming prodigiously from the top. The graph above shows how the total economic cost of financial intermediation grew from under 2 percent in 1870 to nearly 6 percent before the stock market collapsed in 1929. It grew slowly throughout the postwar expansion, reaching 5 percent in 1980. Then, beginning during the deregulatory years of the Reagan administration, the money flowing to financial intermediaries skyrocketed, rising to almost 9 percent of GDP in 2010.

https://tcf.org/content/commentary/graph-how-the-financial-sector-consumed-americas-economic-growth/

The translated narration isn’t very good, and there are some editing glitches here and there, but this video describes some interesting experiments, and has some sections of nice octopus footage.