US still supplying ammunition to Israel

From CNN news 
"While there were calls on Israel to do more to protect civilians, the United States also agreed to Israel's request to resupply it with several types of ammunition, a U.S. defense official told CNN on condition of anonymity. It's not an emergency sale, the official said. 
Among the items being bought are 120mm mortar rounds and 40mm ammunition for grenade launchers, the official said. Those will come from a stockpile the United States keeps in Israel, which is worth more than $1 billion."
It also says 
"The Israeli Foreign Ministry, meanwhile, announced on Twitter that Israel has sent into Gaza more than 4 million liters of diesel for the power station, 3 million liters of fuel and 800,000 liters of benzene for transportation, and 1.6 tons of gas for domestic use during the conflict. 
Forty-three trucks "carrying over 750 tons of food, medicine & supplies" entered Gaza Wednesday from Israel, the ministry said. It provided information on how people can donate humanitarian supplies, and a contact at the Palestinian Customs Agency."

P.S. From 1989
"The diplomat offers an example from his own experience.  “I received a call from a friend of mine in the Jewish community who wanted to warn me, as a friend, that all details of a lengthy document on Middle East policy that I had just dispatched overseas were ‘out.’”  The document was classified “top secret,” the diplomat recalls.  “I didn’t believe what he said, so my friend read me every word of it over the phone.”"
Another:
 "Pianka says the Pentagon sent Israel the bad news: “In so many words, we said: “Sorry, we don’t have any of the ammunition you need.  We’ve combed all depots and warehouses, and we simply have none.”

            A few days later the Israelis came back with a surprising message:  “Yes, you do.  There are 15,000 rounds in the Marine Corps supply depot in Hawaii.” Pianka recalls, “We looked in Hawaii and, sure enough, there they were.  The Israelis had found a U.S. supply of 90-millimeter ammunition we couldn’t find ourselves.”"

On Rosa Luxemburg

by Ingo Scmidt (via Richard Singer):
"Indeed, reading Marx’ Capital today leaves the same impression as reading Luxemburg’s The Accumulation of Capital. One wonders whether Marx and Luxemburg really wrote their books more than one hundred years ago. If not for their historical references to English industrialization and nineteenth-century imperialism, one might think they were written as analyses of neoliberal globalization from the late twentieth century until today. The question, then, is what Luxemburg has to offer that Marx has not already given us. One issue is politics, or, more precisely, the relation between economics and politics. Marx deals with the latter in a separate stream of writings, notably his analyses of class struggles in France from 1848 to 1871⁸, but he never outlines their connection with his economic writings that, as already mentioned, focus largely on England.

Contrary to the strange separation between economics and politics in Marx’ works, Luxemburg addresses the relations between them head on in The Accumulation of Capital. "

Links

All that you wanted to know about Israel-Palestine....from The Outlook
Uri Avnery Once And For All!!!
Interview with Uri Avnery a few months ago
Uri Avnery about his wife Rachel
Angus Roxburgh in The Guardian about a possible way to solve the Ukraine problem "The trick then will be for the west to steer him towards real engagement by promising constitutional talks with Ukraine, provided he takes resolute action to kick out the separatists – who, he has now discovered, are nothing but a liability."
Johnson's Russia List via David Warsh
Another

Rafiq Ghaznavi

Arunkumar Deshmukh writes about him and links to song in Pridhvi Vallabh (1943)
Memsaab about Pridhvi Vallabh
Richard Singer links to a dance-song in Najma (1943) which has Rafiq Ghznavi as MD

Richard Singer about Najma
Rafiq Ghajnavi sins for Motilal

Links

BRIC S: Progressive Rhetoric, Neoliberal Policies
Israel Mows the Lawn
Hiding war crimes behind a question "Two Republican presidents — of all things! — twice blocked Israeli expansionism: Dwight Eisenhower in 1956 and George H.W. Bush in 1989 threatened to stop or diminish America’s lavish aid to Israel. The “settlement” land grab stopped until the pressure was removed, and then it resumed apace."
A visit to Bhondsi jail, where 147 Maruti workers are in jail without conviction for two years
US courts defend the rights of vulture funds over Argentina
Thailand: Revolution by motorcycle Thaksin “rephrased poverty as a lack of state support"
After all that depressing news  (excluding MH 17, since nothing is clear), it is nice to see this:
A tree in India is bigger than the average Wal-Mart

Vitamin deficiency

Apparently prevalent in India. A different view here. In my own case, I visited our physician years ago when I was feeling very letharic. He said that I was aneamic and iron supplements helped. The next time he said it was vitamin D deficiency and supplements helped.

Update on Bali package

from scroll.in
"While India is championing the cause of the least-developed countries, its primary focus is an agricultural agreement on food security. WTO rules mandate that countries cannot subsidise more than 10% of agriculture because it would distort the market, and the organisation has various other rules on minimum support prices for farmers and stock holding limits for grains. Simply the Food Security Act ensures that India’s agricultural subsidies could exceed these limits.
The Bali agreement sought to give India some leeway on this matter by putting its food security programme in an Amber Box – which means that other countries agree to a “peace clause” and will not legally challenge India subsidies even if they do breach WTO limits for the moment. This gives the organisation four years to work on a broader agricultural resolution.

Double Standard
India would like to put the entire programme into what in WTO parlance is known as the Green Box, making food security programmes completely legal rather than just permissible. China has also supported this position. It has also been convincingly argued that the position taken by the developed world – that this would distort the market – is a double standard. Agricultural economist Jacques Berthelot has argued for some time now that the United States has placed most of its hefty subsidies in the Green Box, while also under-notifying the amount of agriculture it subsidises.
......
For the moment, this means the WTO’s signature agreement – the Bali Package – is not going to be delivered any time soon."

Evan Osnos on corruption in Chinese railways

Boss Rail from New Yorker, October 2012. This is part of Chapter in his book, 'The Age of Ambition'. In the update, Osnos says that in spite of corruption, unlike other corrupt officials, Lin Zhijun had produced a railway system. Liu was given death sentence with reprieve in  July 2013.

A detailed discussion on the New Development Bank

from Michael Hudson and Leo Panitch. Both are of Marxist persuasion and have written books on globalization. Yves Smith posted the discussion with her comments:
"The US could lose reserve currency status through a catastrophe that severely damages its economy, like a massive natural disaster or unforeseen consequences of having its aggressions escalate into a hot war. But the actions the BRICs are taking don’t rise to any kind of threat, and unless they take vastly more concerted actions, are unlikely to displace the dollar in the next ten years.

An interesting aspect of this talk is the difference of views between Michael Hudson and Leo Panitch. Hudson is bullish on the BRICs plans, Pantich much less so."

Stiglitz interview on the BRICS New Development Bank

http://www.democracynow.org/2014/7/17/nobel_economist_joseph_stiglitz_hails_new
http://www.democracynow.org/blog/2014/7/17/web_special_joseph_stiglitz_on_tppussion in Economist's View http://economistsview.typepad.com/economistsview/2014/07/stiglitz-interview.html

A discussion of Karl Polanyi ideas

The Power of Market Fundamentalism

Arundhati Roy on Gandhi

According to Arundhati Roy Groupies "It is time to unveil a few truths about a person whose doctrine of nonviolence was based on the acceptance of a most brutal social hierarchy ever known, the caste system … Do we really need to name our universities after him?" Roy said.
According to Nicholas Dirks in "Castes of Mind" (page 234)
"...Gandhi modified his views on caste over the years..... When, years later. Gandhi defended himself against attacks by Ambedkar over his views on caste, he wrote that “Caste has nothing to with religion. It is a custom whose origin I do not know and do not need to know for the satisfaction of my spiritual hunger. But I do know that it is harmful both to spiritual and national growth.” At roughly the same time, he stated that “Caste has to go”"

These statements of Gandhi do not seem to be well known. The references that Dirks gave are: Gandhi, Collected works, vol. 63, p.153, vol. 62, p.121 

Several times Gandhi expressed his admiration for Ambedkar.

Some interesting flowers from India

http://www.flickriver.com/photos/45835639@N04/popular-interesting/ Found it while looking for Murdannia striatipetala Faden More at https://www.flickr.com/photos/45835639@N04/page1/

An old review by Brad DeLong

of  "Seeing Like a state" by James Scott via Chris Blattman which links to other reviews.

CAG report on land acquisition

(via Shivam Vij) in Scroll.in
"Its previous avatar, the Land Acquisition Act of 1894, had been framed to enable the government to acquire land “for projects of public purpose”. However, over the last decade, state governments around the nation used it repeatedly to acquire land for private industry.
The centre and states argued that the industrialisation such land acquisitions encouraged did serve public purpose, by creating jobs and fuelling economic growth. But farmer groups and grassroot organisations maintained that such acquisition deprived farmers of a fair price for the land. Industry, meanwhile, claimed the acquisition was slow and projects were being delayed.
The Comptroller and Auditor General has studied all cases of land acquisition for private industry by the Odisha government between 2001-'12. Its audit report provides hard evidence for what many have suspected till now."

John Weeks on the Brics Bank

in Open Democracy "We should note that the voting proposal for the BRICS bank follows the IMF/World Bank model – money votes with shares, reflecting each government's financial contribution. The largest voting share goes to China, whose record on investments in Africa is nothing short of appalling (see my discussion of Chinese capital in Zambia).....However, it is worth asking what to me is the obvious question – why is it necessary for countries to borrow to build, for example a new airport? The problem is never ‘money.’  Any government of a country that has its own currency can borrow from the central bank (this would not apply to the 14 members of the West and Central African currency zones). Only one reason comes to mind about borrowing from abroad: that the project may require substantial imports of materials. Thus, the purpose of the borrowing is to obtain US dollars, yen, renminbi, etc.  

Since the purpose of the loan is to obtain foreign currency, the process by which the BRICS bank reviews and assesses specific projects will likely involve the same unnecessary bureaucracy that we find in the World Bank. The suspicion uppermost in my mind is that the purpose of the BRICS bank, as a project funding bank, is to link the finance offered, to the construction firms and materials suppliers located in the BRICS themselves. Certainly, the Chinese Government is notorious for doing this (see 'China insists on "tied aid" in Africa')."

Discussion of the BRICS Development Bank

at AlJazeera Can BRICS counter the West? At Financial Times. Some more aspects at  http://www.scidev.net/global/funding/news/brics-agree-development-bank-and-science-forum.html
P.S. A discussion paper from UNCTAD (March 2014) http://unctad.org/en/PublicationsLibrary/osgdp20141_en.pdf

Middle class in India and China

A review of Rana Dasgupta's Capital and Evan Osnos' 'The Age of Ambition': In both India and China, the growing middle class is in trouble  (Just finished the first and startin on the second) "Medicine is only one area where the state has stepped back from the lives of Delhi’s middle class. Its main role now, Dasgupta believes, is to keep the poor at bay. That vision in and of itself is nothing new. What is new, though, is Dasgupta’s belief that it isn’t temporary or simply a case of growing pains. He sees Delhi as a place where flourishing wealth and the state have stopped lifting its citizens out of poverty.

In that way, Dasgupta’s vision of Delhi is not much different from the one Evan Osnos offers of China in Age of Ambition ($31, Farrar, Straus and Giroux). Osnos, who spent eight years reporting from Beijing for the Chicago Tribune and The New Yorker, presents a much less desperate and angry view than Dasgupta. But his book is, in its own way, no more optimistic."

From Rana Dasupta's Capital

"You think that there are certain primordial events that eclipse all others.You think, for instance, that no suffering can be so great as that of a parent who lost a child. But there are things that are even worse, forms of suffering so great that they harden people even to the death of their children. And you can see them everywhere in the country." a psychologist involved in counselling the parents of the Nithari victims, after recounting that some parents said "If we had known there would be 5 lakhs for a dead child, we would have sent two children"
P.S. At the top of page 330, Rana Dasgupta says "Indira's adored eldest son, Sanjay."

Rana Dasgupta on his book

Capital: A portrait of twenty-first century Delhi, published in early 2014, "Capital is about the members of the rising, moneyed sections of the Indian urban population who see themselves as primary agents - and beneficiaries - of globalization. It has become common to refer to these people as 'the new Indian middle class', and I too employ the phrase. But while their lifestyle has come to bear some resemblance to that of the 'middle classes' in Europe or America,the phrase sits uncomfortably with the Indian situation. At the time of writing, those Indians whose families earned more than Rs. 500,000 [$10,000] per year represent less than 10 percent of the population, which meant that middle-class' accoutrements and ideas belonged, in the Indian context to the elite. Since the Indian economy was being restructured around the spending power of this emerging class, and since the entailed conflicts over land and resources which often punished the much greater number of the country's rural poor - many of whom earned less than $500 per year - it is important to retain this sense that the interests of the Indian middle classes were not lowly or innocent. The phrase 'bourgeoisie' , in fact, which I also sometimes use, more accurately describes their condition.'

John Perkins' book

The Confessions of an Economic Hitman is available on line. More about the book here. An interview.

Papers on Godel

Kurt Godel and the Foundations of Mathematics ¨Horizons of Truth is available on line
via a post in Information Processing which has some excerpts including this from Paul Cohen (Who solved a problem which Godel could not):
"I can say my feeling was roughly this: How can someone thinking about logic in almost philosophical terms discover a result that had implications for Diophantine equations? ... I closed the book and tried to rediscover the proof, which I still feel is the best way to understand things. I totally capitulated. The Incompleteness Theorem was true, and Godel was far superior to me in understanding the nature of mathematics."

Mujra from 'Sahib, bibi aur ghulam' 1962

Too much bad news today

starting with this
Asylum seeking mothers on Christmas Island attempt suicide in bid to help children
Syria's war widows fight for survival
"Yves here. As Ilargi himself acknowledges, even by the standards of his fare, this post on “overshoot” is plenty sobering. We do seem to be on our way to precipitating a mass species die off (as in it’s underway already and humans seem remarkably unwilling to take sufficiently stern measures to stop it). The end of civilization as we know it seems almost inevitable, given that most “advanced” economies are seeing serious erosion of their social fabric, as reflected in falling social well-being measures."
I guess that I will stop.

From Rahi 1953

There are two male voices, neither sounds like Hemantha Kumar. I wonder whether one of them is Anil Biswas himself. The dancers are from Little Ballet Troupe, associated with IPTA.

A great essay

A musician wonders about a folk song (or two) gets into history, politics and economy.
Ground Down to Molasses by Dave Byrne

Friendship and success in Silican Valley

"It's a pretty rare occurrence that a startup will make it from inception to exit. What is decidedly less common is that startup reaching an exit upwards of $1 billion dollars. Yet even more extraordinary is that exit becoming the catalyst for a revitalization of a local economy and a specific type of investing.
Despite astronomical odds, this is what happened when PayPal sold to eBay in the summer of 2002 and the PayPal team members went on to found some of the most important startups -- and make some of the most strategic investments -- of all time." The story in How the 'PayPal Mafia' redefined success in Silican Valley.
"PayPal's early story was unique in many ways, but especially with respect to the people behind it.

"When we started PayPal, I remember one of the early conversations I had with Max [Levchin] was that I wanted to build a company where everybody would be really great friends and, no matter what happened with the company, the friendships would survive," former PayPal CEO Peter Thiel said. "In some ways that was very utopian. We didn't only hire our friends, but we did hire people that we thought we could become really good friends with."

Many of those friendships began at Stanford. Keith Rabois, David O. Sacks, Reid Hoffman, and Ken Howery all attended Stanford around the same time and most were subsequently recruited by Thiel to work for PayPal. Max Levchin recruited some developers and former classmates from the University of Illinois at Urbana-Champaign as well.

What's unique is that the majority of the early PayPal employees, and the PayPal Mafia in general, were all recruited through a friendship network and not by a headhunter. Sacks said that these people were "cut from the same cloth." This, he said, explained how they all had such a strong entrepreneurial focus to begin with."

Music by Kalyan

This is by old friend Kalyan Mukherjea whom I knew from 1970 until his death in 2010. I never listened to his music when he was alive; it was either mathematics or gossip. Off and on there was tension since he oozed aristocracy and I was not keen about aristocrats. After 1995, he was partially paralyzed and was blind towards the end. I used to visit him in Kolkata, drink with him, light cigarettes and pass on to him and burnt his hand a couple of times. Altogether a wise man who encouraged many younger people in mathematics and music. 
https://soundcloud.com/arnabmeister/jaunpuri-by-prof-kalyan
(Uploaded by Arnab Chakrabarty)

The Internet's Own Boy: The Story of Aaron Swartz

Absorbing, enlightening and moving.
Review http://www.berkeleydailyplanet.com/issue/2014-07-04/article/42253?
A point about which does not come out clearly in the film or the review is in this article Aaron Swartz:a beautiful mind by Paul McGeough :
"In his attic meeting with McLean during the OPEN summit at Holmes, Swartz had sketched the contours of a new order, in which he envisaged corporate power being severely weakened and political parties replaced by internet-based people power. In contrast to efforts by activists such as Edward Snowden and Julian Assange, who sought to reduce state power that derived from secrecy, Swartz's objective was to build citizen power to counter that of governments and corporations. He revealed a grand design by which he envisaged artificial intelligence making activists such as himself and McLean redundant." 

Future of Capitalism?

In a May 22 article Mark Varga wrote "Everything points to the fact that Ukraine is the only country in the region where the oligarchs have thrived, playing political leaders off against each other and skewing the political system to their favor. Were Poroshenko to win the elections, we would see the birth of the first truly oligarchical society in Europe."

Earlier in the article "Seen in political terms, the corollary to Piketty’s economics translates thusly: Wealth attracts more wealth, which subsequently leads to a concentration of power. The problem of income distribution therefore makes its way to the political system and the overall system of governance, as the economic elite seeks to protect its concentration of power, leaving elected rulers powerless to stop this self-sustaining process. In the long run, widening economic inequality would impact the political class, depriving it of the power to act as the rich get more powerful and more united while the poor lose the capacity to impact the polity. The end state of this slow, incremental process spells the end of the democratic process. A once-liberal society would therefore be transformed into an oligarchical society.

One of the few countries in the developed world that can effectively test Piketty’s hypothesis is Ukraine, with its highly influential class of businessmen-cum-power brokers."

The article ends "Piketty, start writing the sequel!"

Aimless browsing

"The free market brings to you a wealth of consumable rubbish, but inadvertently it will give you an artefact or gem without explanation. Very little information is provided: you, like a critic or connoisseur, will have to decide if what you’re watching has significance." says Amit Choudhuri in Watching DD Bharati.  (via Guru http://mogadalai.wordpress.com/). I do not know whether they are significant or not. I watch various things aimlessly, sometimes searching equally pointless things and find things which fascinate me. Here is one of those things which i still remember after a couple years with some dances around 25 minutes.

Ustad Bade Ghulam Ali Khan - Documentary

Similarities with Kathak

It seems that Piketty's influence may last a bit longer

The name is getting into the titles of various articles.
First a summary of various reviews by Cory Doctorow
Piketty gap splitting butcher fortunes widened by Aussie policy
Juma on Piketty's Capital: can Africa avoid the trap of unequal growth
Reading Piketty in Peking: The case against capitalist inequality in communist China
Is there a Ma Joad for the Piketty Era?
Monsieur Piketty goes to Latin America
What does Piketty's Capital mean for devloping countries?
What Piketty tells us about Ukraine?
Why we are Marxists? from Jacobin

Curry comes of age in Britain

From You can't beat a good Indian curry, after all "Britain’s restaurateurs are scratching their heads. An Indian establishment has clinched the number one spot in the National Restaurant Awards." It seems a lot different from 1968 when I endured Indian food in Liverpool restaurants.Finally I asked in one restaurant why they made such food and the reply was that was way British liked it. I then asked whether they ate the same food. They said that they had a separate curry for the staff. From then on I used to ask for the staff curry.

More on tax havens and money launderting

From Stash Pad "It turned out that offshore locales like the Caymans were the most stringent about complying with international anti-money-laundering standards. It was easier to set up an untraceable shell company in the U.S. than in any country other than Kenya. The study found firms in business-friendly states like Delaware and Nevada were particularly “abysmal.”

No federal authority, not even the IRS, keeps track of the actual “beneficial” owners behind LLCs, and the more lenient states don’t even require much record-keeping by the firms that handle incorporation. ...

Ukrainian politician Yulia Tymoshenko has filed a civil lawsuit claiming a crony of the country’s ousted president moved tainted money into New York development projects, while her opponents claim, in turn, that she laundered money through the city’s real estate.More on tax havens and money laundering"

Timothy Wise on a case of land grab in Africa

From Picking up the pieces from a failed land grab project in Tanzania "He offered his personal opinion that Mtanga should negotiate, but confirmed, “The village has no control after the land is transferred to general land. In practice, all they are entitled to is compensation.”

It has become clear that companies can make whatever false promises they need to make to secure land, knowing that once they get the land they can renege on the promises. Tanzanian Land Minister Anna Tibaijuka has called actions like these “equivalent to Ponzi Schemes.”

Still, government representatives in Rome are actively resisting any effort to include land rights in the guidelines for responsible agricultural investment. Without them, foreign agricultural investment in Africa is likely to remain as irresponsible as it is in Kisarawe."- 

More from Michael Hudson on Ukraine

http://michael-hudson.com/2014/06/ukraines-gangster-state/
and a discussion in Naked Capitalism of another video
From the second "Well, I’m going to begin by putting it in the big picture, and then I’ll get to the details. The big picture is that this is a form of colonialism almost identical to what Europe did in Africa and Latin America and the Near East. What it did in the 19th century in Africa, where property was owned communally, was it would go to the chieftains of a given tribe, as it did to the Saudi Arabian chieftains, and it would say, well, to make an agreement, you have to register all this oil of your country, but you register it in your own name. And once they registered it in their own name, then Britain or France or the other European powers could make a deal that the chieftains could then sell this property or make contracts on behalf of oil or minerals with the European colonial powers. And that’s how the colonial powers pried away all of this property from what had been tribal possession or communal possession."
The first is even more scary:
"RT: Timoshenko revealed her real oligarch face in a leaked call pledging to nuke the Eastern part of Ukraine.

Leaked conversation between Deputy Nestor Shufrich and Fatherland leader Yulia Timoshenko:
Shufrich: What shall we do with the eight million Russian(-speakers) in Ukraine?
Timoshenko: Kill them with nuclear weapons.....

Ukraine: Triumph, Tragedy, or Farce? report: The neo-Nazis are paying regular reconnaissance visits to nuclear power stations, with obvious intent to hold the whole world hostage. They have paid visits to bacteriological laboratories and, according to the people working there, got hold of bacteriological material that can be used for biological warfare. Other terrorists have merely been dreaming of such weapons – Ukrainian ones, with the connivance of or on direct orders from someone in the junta, may actually use them – to Senator McCain’s delight."

Awara Hoon

Lots of sites these days about film songs with various articles about best songs of particular mood or year or those based on a particular raaga etc. Slowly these classifications and lists seem to move the new elites away from the common people the exact opposite of what was achieved by the film music. I saw a recent list of ten best male Hindi film songs of 1951 in which 'Awara Hoon' does not make the cut. 
Wikipedia article on Awara Hoon and the song https://www.youtube.com/watch?v=PTAvDwboFVE

Gian-Carlo Rota on teaching ordinary differential equations

One of my pet aversions during college days is a course on ordinary differential equations. Rota lets himself go on the topic "Why is it that no one has undertaken the task of cleaning the Augean stables of elementary differential equations? I will hazard an answer: for the same reason why we see so little change anywhere today, whether in society, in politics, or in science. Vested interests dominate every nook and cranny of our society, even the society of mathematicians. A revamped elementary differential equations course would require Professor Neanderthal at Oshkosh College to learn the subject anew. The fatuous, expensive, multi-colored textbooks that are now cornering the market would be forced out of print. New textbooks would have to be written. We know what an effort goes into writing a textbook, and how negatively such an effort is rewarded. No clear-headed young mathematician will risk ruining his or her career by writing such a book, as I did." That was from 1997 article about forty years after i took the course.http://www.ega-math.narod.ru/Tasks/GCRota.htm

Fascinating article about Stan Ulam

by Gian-Carlo Rota The Last Cafe via a comment in Who invented the Metropolis algorithm?

'Ae Re Main Tu Prem Diwani' with subtitles

Continued misreadings of Piketty?

In VoxEu Odran Bonnet and others write "Thomas Piketty’s claim that the ratio of capital to national income is approaching 19th-century levels has fuelled the debate over inequality. This column argues that Piketty’s claim rests on the recent increase in the price of housing. Other forms of capital are, relative to income, at much lower levels than they were a century ago. Moreover, it is rents – not house prices – that should matter for the dynamics of wealth inequality, and rents have been stable as a proportion of national income in many countries."
They agree "...housing is not just wealth but also capital, and it contributes to wealth accumulation. However, to be in line with Piketty’s capital accumulation model, the measurement of housing capital must be based on actual returns to housing – that is, rent."
This is not clear to me. One can borrow on a house to invest and buy other houses. There are cases in Melbourne where people have about ten houses and flats by a young age mainly using housing to borrow more to buy other houses. The expenditure on the houses and mortgage can be deducted from the rent and the capital is used to essentially obtain more  capital without any extra effort or savings. This of course varies from place to place and the local rules.
The other misconception seems to that it does not immediately follow from r > g that inequality increases. The inclusion of housing also seems connected with Matt Rognlie critique but are not answered yet as Rajiv Sethi explained. But this conclusion also uses the fact that capital is unevenly distributed, as Matt Bruenig explains here. Another common error is discussed by Matt Bruenig recently.