Bill Mitchell on Marriner Eccles

[Economic liberals] deliberately create unemployment and poverty and try to spin a narrative that this is labour market reform or essential fiscal consolidation. Marriner Eccles clearly saw through all of those arguments when they were used in his time.

This narrative is usually based on the false analogy between a government as the currency issuer and households and firms, which are currency users.

Neoliberals claim that governments, like households, have to live within their means. They say budget deficits have to be repaid and this requires onerous future tax burdens, which force our children and their children to pay for our profligacy.

The false neoliberal analogy between national budgets and household budgets resonates strongly with voters because it attempts to relate the more amorphous finances of a government with our daily household finances.

"Labor market reform" amounts to reducing the economic position of workers enough to induce "wage flexibility," that is, undermining labor bargain power so that employers can offer less, even less than a living wage, driving workers into debt — as is presently the case with major employers in the US such as Walmart, in a return to Dickensian times. For further development see Michal Kalecki in Political Aspects of Full Employment

Bill Mitchell – billy blog

There is nothing new under the sun

Bill Mitchell