An economics, investment, trading and policy blog with a focus on Modern Monetary Theory (MMT). We seek the truth, avoid the mainstream and are virulently anti-neoliberalism.
"Pressures for higher nominal wages spawned wage-price spirals. ... hyper-inflationary crises stemming from labor militancy ... turned real rates of interest negative by the mid 1970’s."David is a good guy but he and Bill Mitchell seem to have bought into the right wing "70's inflation was labor's fault" narrative. No mention of oil, or events in the Middle East?Otherwise David hits a lot of good points.It's hard to pin the rise of Neoliberalism on any one thing. The Rockefeller-funded election of Jimmy Carter, the failure of the "left" to address 70's oil-induced inflation, and the fall of the Soviet Union come to mind. Oliver Stone views the turning point as the machine-orchestrated selection of Harry Truman as FDR's running mate in 1944, rather than Henry Wallace. The only thing new about Neoliberalism is its love of free trade, probably prompted by the rise of giant international corporations who benefit from free trade. Otherwise neoliberalism is merely a return to pre-New Deal capitalism. A better question might be "how did the New Deal manage to survive as long as it did?"
The Rise of Neoliberalism coincided with the demise of unions. Without a countervailing force, Capital was able to regain the upper hand. There was a shift in power, along with a shift in policy and ideology.
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