Wednesday, May 22, 2013

JP Hochbaum — Sectoral Balances

I know it may seem unbelievable but there was a time when I was a follower and avid fan of the Austrian school of economics. I believed that government spending crowded out private sector spending, that all government expenditures were somehow passed onto my grandchildren, that government spending lead to inflation, and a myriad of other beliefs that stemmed from what I thought was a logical approach to economics. I read Ayn Rand, listened to John Stossel, almost voted for Ron Paul in 2008, and I drank beers with fellow libertarians.
So what happened between then and now? Back in 2008, after the election, I told myself I would suspend any ideology I had when it came to economics and other political issues and refocus on just finding what was really going on with our country. During many years of engaging with people via blogs and forums I collected a myriad of economics experts as friends and so I had plenty of information to digest, to come to where I am at today as an MMT’er. My “conversion” (not to be confused with a religious or ideological conversion that relies on morals and faith) came about in a gradual way, but one particular fact really gave me that “A HA!” moment, and that was seeing a “sectoral balances graph”, like the one below....
Heretical Druthers
Sectoral Balances
JP Hochbaum

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