Story at FoxNews here. Here is an interesting excerpt:
"But it's amazing how these Republicans, the right wing of this party – whose philosophy threw us into this godawful hole we're in, gave us the tremendous deficit we've inherited – that they're now using the very economic condition they have created to blame the victim..."
I find it hard to argue with the part of the VEEP's statement that I've highlighted, as it appears that many in the GOP are heavily and increasingly influenced by secular philosophies that, if not "handled carefully", can promote chaos, disorder and anti-social economic outcomes.
Among these philosophies I would include Ayn Rand's Objectivism and forms of Libertarianism.
Biden is becoming increasingly outspoken lately. He must have the president's permission, if not encouragement. Looks to me like Campaign 2012 is underway with the VP playing the role of attack dog. If Biden falls into paradigm with MMT even slightly, that would be a huge plus.
ReplyDeleteIt is clear that the neoliberal paradigm of free markets, free trade, and free capital flows, meaning minimal government regulation, has failed because of the false assumption that markets are self-regulating and self-correcting.
As we saw in the case of the GFC, financial markets don't always clear in the absence of government intervention, and economies leaking demand to savings and net imports simultaneously don't spontaneously recover either.
The basic insight of the sectoral balance approach is that the fiscal balance must offset leakage to saving and net imports. The basic insight of functional finance is that government can run whatever fiscal deficit is needed to offset this leakage, and it must do so to achieve full employment with price stability. Otherwise, the economy will underperform and the result will be huge losses from foregone opportunity that cannot be recaptured.
Let's hope the VP picks that up and runs with it. Otherwise, the US is in deep doo-doo if the austerians prevail.
If Mike Norman is right that MMT is getting into Biden's head through Mike's indirect connection to him, then the best thing that could happen is for Obama to resign or be impeached, so that Biden could have a shot. Boy, would I love to see that.
ReplyDeleteAlso, I quite agree with Matt that Objectivism and Libertarianism are bot bankrupt and damaging social philosophies.
Tom,
ReplyDeleteThis gets to the crux of the damaging beliefs: "markets are self-regulating"
Is this statement even logical? Can what amounts to a set of legal arrangements set up by a group of human beings "regulate themselves"?
Do markets "have a brain" to be able to do this?
These folks are slipping into almost sort of a form of insanity imo, where they are applying human characteristics to legal arrangements.
Resp
Letsgetitdone,
ReplyDeleteRight. I have some very good (albeit indirect, via Bob Beckel) contact with Biden. Beckel tells me he is fighting the fight against a coterie of deficit hawks within the White House.
Personally, I am glad to see him use such a shocking comparison. I even sent an email to Beckel saying that this was a really good tactic.
It's war when it comes to getti ng the message out and we've got to counter the Deficit Terrorist hysterics.
It's war when it comes to getti ng the message out and we've got to counter the Deficit Terrorist hysterics.
ReplyDeleteAbsolutely. The social and economic consequences of the austerian alternative are horrible to contemplate. Its the rule of the crazy.
Explaining MMT to Biden will have have the same result as when Warren thought he explained it to Al Gore. He is more concerned about having an Amtrak station named after him. MMT needs a newer face, not a career glad hander. (Mike's teeth are too white and Warren is too unassuming.)
ReplyDeleteAll of the secular philosophies have their points, otherwise they would never have been thought of. Everyone sees the world through their own lens. You all know that. The Great Society may have had the worst anti-social economic outcome of all, yet was well intended. The trick is to minimize rent seeking, moral hazard and cronyism, while keeping government strong and fiscally prudent. A very tall order in our complex aging democracy.
I'm glad you all are contributing to this blog. The word is being spread.
Chewitup, It's not good to be overly pessimistic. Anybody remember Pope John XXIII? He was a total surprise. Also, FDR ran on a balanced budget. An when harry Truman succeeded Roosevelt no one expected any thing out of him at all.
ReplyDeleteAnyway, Obama's failed. He's a tool of the Plutocrats. Believe with Biden's background in the old-style liberalism of the 60s and early 70s, he will be a lot better than Mr. O.
I agree with you, Mike. I'm fighting as hard as I can on as many sites as I can. I've been fighting for more than a year now. Even before I discovered MMT.
ReplyDeleteI also understand Chewitup's pessimism. I feel that way many times when I watch the news and listen to the commentary.
ReplyDelete