Thursday, December 8, 2016

Claire Connelly — The great 'living within our means' con: Why you're more in debt than ever


MMT in Australia with Bill Mitchell, Steve Keen and Stephen Hall.

ABC (Australia) — Opinion
The great 'living within our means' con: Why you're more in debt than ever
Claire Connelly

7 comments:

peterc said...

OMG, the ABC for once actually published something on economics worth reading. Great job by the author.

Of course, it had to be categorized as "opinion" because it exposes as nonsense the usual lies from market economists and politicians that the ABC parrots . :-)

peterc said...

^ An edit for Matt's sake. Replace "lies" with "moronism". :-)

Tom Hickey said...

Where the mistake begins is with treating economics as the study of "the economy."

Modern societies are complex social, political and economic systems that are tightly integrated. Assuming that there is an economy that can be abstracted and treated like a physical system similar to natural sciences is fundamentally flawed.

The mistake of Keynes was to take Marshall as his starting point and draw in Walrus and the rest. Then he was reduced to showing where they went wrong, whereas that approach is so misguided that it cannot be fixed. Using this approach is groping in the dark, or like the drunk looking for the keys he lost in the grass on the sidewalk under a lamppost because there is more light there.

A fresh approach to understanding how modern societies operate social, political and economically is needed and it must be an integrated approach to be complete enough to be relevant to policy.

TofuNFiatRGood4U said...

peterc,

Note it's a free-lancer who doesn't provide (or isn't allowed to provide) the name of the economic theory underpinning her story.

When the ABC uses the expression 'MMT' or 'Modern Monetary Theory', maybe I'll stop viewing them as a fascist mouthpiece driven primarily by their own self-interest.

They're only fit to deliver the weather and the sports scores.

The only people more duplicitous are the Greens (Australian AND American).

Matt Franko said...

"abstracted and treated like a physical system similar to natural sciences is fundamentally flawed."

It most certainly can be.... by material systems qualified people not the people in there now obviously...

Tom Hickey said...

The people behind this erroneous idea were not material systems people. They were not systems people in any sense.

Nor did they understand accounting. Nor did they understand psychology, biology, sociology, or political science.

As result, they took a wrong turn in "upgrading" the classical approach instead of listening to Veblen, for example.

As result economics did not keep up with scientific knowledge in other fields and did not observe consilience by integrating advances.

The result is that economics based on economic liberalism comes into conflict with social and political liberalism resulting in paradoxes of liberalism that threaten to undermine liberalism as an organizing principle.

In addition, the analysis itself mistakes special cases for the general case, rendering analysis sterile at turning points, which are precisely the places were correct analysis is most needed wrt policy formulation.

Auburn Parks said...

Seeing as the difference between 3% average growth between now and 2100 and 2% average growth is basically $100 trillion per year in real wealth production, I am going to suggest that these peoople have no idea what they are doing. IOW even if they wanted to average 3%, they have no idea how to do it long term.