Tuesday, April 30, 2019

Bill Mitchell — Marxists getting all tied up on MMT

Marx, MMT, wage labor and surplus value.

Bill Mitchell – billy blog
Marxists getting all tied up on MMT
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

See also

The Radford Free Press
A Quick Note: Utopian or Real?
Peter Radford


The Iron Fist Behind Exchange: The Problems With The Freed Market

Andrei Martyanov — S-500 Is On Line

As is expected, by far not all data on actual capabilities of S-500 is available, but the range of 600 kilometers against any aerodynamic targets means one not just tactical or even operational, but fully strategic ramification--it is precisely the range within which latest versions of E3 Sentry AWACS aircraft must enter to have any impact of the target acquisition and battle management. So, you get the idea, right? As you can see, my next book (while still not 100% completed, very close, though) is getting ready for hitting shelves this Summer, and it touches partially on these issues. No NATO Air Force is capable to fight without AWACS enabler. Without it it becomes severely degraded and an easy pick for hostile Air Force and, especially, ground-based modern AD complexes such as Buk-M2, S-400 and S1 in the "ambushes". While one may argue with Irina Alksnis' (in Russian) that Russia didn't exit from arms race, she simply won it, there is very little doubt about the fact that within last 15 years Russia designed, developed and produced some of the most revolutionary weapon systems in history, and which did change warfare and rendered old operational and strategic thinking still dominating Western military-political circles simply obsolete.…
This is what Russia and China mean by "asymmetric response." This is nothing new. Chinese military history is replete with introduction of new weaponry to counter advances in weaponry by enemies. See below.

This is also doing the arms race on the cheap. The US builds up its forces expecting an expensive symmetrical response, only to find that its investment has been countered by less expensive, more innovative means. This is key, because key to the US strategy in an arms race is to "bankrupt" the adversary. It is as much economic warfare as military.

Reminiscence of the Future
S-500 Is On Line
Andrei Martyanov

See also

David Lague, Benjamin Kang Lim

What America can learn from the fall of the Roman republic — Sean Illing interviews Edward Watt, author of Mortal Republic

If you were a Roman citizen around, say, 200 BC, you probably would have assumed Rome was going to last forever.

At the time, Rome was the greatest republic in human history, and its institutions had proven resilient through invasions and all kinds of disasters. But the foundations of Rome started to weaken less than a century later, and by 27 BC the republic had collapsed entirely.
The story of Rome’s fall is both complicated and relatively straightforward: The state became too big and chaotic; the influence of money and private interests corrupted public institutions; and social and economic inequalities became so large that citizens lost faith in the system altogether and gradually fell into the arms of tyrants and demagogues.
If all of that sounds familiar, well, that’s because the parallels to our current political moment are striking. Edward Watts, a historian at the University of California San Diego, has just published a new book titled Mortal Republic that carefully lays out what went wrong in ancient Rome — and how the lessons of its decline might help save fledgling republics like the United States today.

I spoke to Watts about those lessons and why he thinks the American republic, along with several others, are in danger of going the way of ancient Rome. A lightly edited transcript of our conversation follows.
What America can learn from the fall of the Roman republicSean Illing interviews Edward Watt, author of Mortal Republic 

Chimp scrolling Instagram on iPhone proves it’s just like us

Only 1:15.

Chimp scrolling Instagram on iPhone proves it’s just like us

Richard Murphy — In the FT this morning: modern monetary theory is the answer to the new normal

I had this letter in the FT this morning in response to a piece from Gavyn Davies, which continued the standard neoclassical economist's tradition of entirely missing the point about modern monetary theory….
Tax Research UK
In the FT this morning: modern monetary theory is the answer to the new normal
Richard Murphy | Professor of PracticeInternational Politics, School of Social Sciences, City, University of London; Director, Corporate Accountability Network; Co-founder, Green New Deal

Matias Vernengo — Structural Change in China and India: External Sustainability and the Middle-Income Trap

AbstractThis paper focuses on the different development strategies of China and India, particularly regarding the role of manufacturing and services, for long-run productivity growth, external competitiveness and financial fragility. The findings appear to support the argument that productivity improvements in manufacturing drive productivity improvements in other sectors. They also substantiate previous findings that the Indian services-led growth trajectory has had limited success in transferring surplus labor from agriculture to other sectors. Furthermore, the trajectories have affected the export performances of the two countries with the Indian trade balance and current account revealing persistent deficits, compared to China's surpluses. The paper also argues that the way in which India has sought to sustain these deficits entails elements of financial fragility, and that the Chinese struggles with the internationalization of the renminbi also imply a possibility of financial instability.
Naked Keynesianism
Structural Change in China and India: External Sustainability and the Middle-Income Trap
Matias Vernengo | Associate Professor of Economics, Bucknell University

Bill Mitchell — The austerity attack on British local government – Part 1

On Sunday, May 12, 2019, I will be presenting a workshop in London on – Local Government Funding: Challenging the Status Quo. Basically, I will be speaking about the way in which flawed understandings of the capacities of currency-issuing governments, combined with a vicious, ideological attack on working people from a government fully invested in neoliberal transfers to the elites, have ravaged the capacity of local government in the UK to deliver essential public services. See the Events Page for more details. It is a public event and I hope people support it. To prepare for that workshop, I have been digging deeply into the data to fully acquaint myself with how the ideological austerity push has been distributed across central and local government service delivery. It is no easy task. The data is a ‘dog’s breakfast’ and coming to summary positions is quite time consuming. There are also nuances in the way local government is structured (particularly since the Thatcher years where devolution and cost-shifting was accelerated), which mean that care must be taken in making sensible comparisons. Here are some of the things I found. I have learned a lot in this process, which is a good thing. This is Part 1 of a two-part series....
Bill Mitchell – billy blog
The austerity attack on British local government – Part 1
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Monday, April 29, 2019

Philip Pilkington — How Far Can We Push This Thing? Some Optimistic Reflections on the Potential For Economic Experimentation

Readers are probably aware that there is quite a lot of discussion of Modern Monetary Theory (MMT) and the potential for fiscal experimentation batting around at the moment. Others have weighed in on this already, and I have little to add.
It is striking, however, that most of the push-back — where there is push-back — is not focused on trying to discredit the idea that we should engage in fiscal experimentation. Indeed, the notion that we should engage in fiscal experimentation seems to be, if not mainstream, at the very least part of the discussion.
Yet, vulgar strawman-style arguments against MMT aside, no one seriously disputes the fact that if too much fiscal expansion is undertaken the economy will eventually hit a hard inflation barrier, past which any increase in spending will generate inflation rather than real output expansion. Interestingly, no one seems to have tried to come up with a new framework for estimating where this inflation barrier might be and whether it is too risky to overshoot it.
So, I’ve decided to fill that gap. Linked below is a paper where I use a new capacity utilisation-based framework to provide hard, yet optimistic numbers of how far we might push the economy in the spirit of fiscal experimentation....
Fixing the Economists
How Far Can We Push This Thing? Some Optimistic Reflections on the Potential For Economic Experimentation
Philip Pilkington

Renegade Inc - Ben Norton: Renegade Inc: Russiagate! – The Collusion Delusion

Wow, Ben Norton packs quite a lot in half an hour from Russia-Gate through to WW3 and everything inbetween! The ruling elite own the media and don't care about us, or democracy, or a better society, says Ben Norton, and that they only care about their imperial control of the world.

Ben Norton says the mainstream media are only interested in profits and the Russia-Gate nonsense was very profitable for them, plus their propaganda suited the establishment. Now Julian Assange is being portrayed as a Russian agent who helped the Russians to get Trump elected. And Trump, who represents a part of the establishment, is controversial enough to keep newspaper sales up.

Ben Norton says the elite are dead scared of socialism taken root as their neoliberal policies destroy the economy, so they back fascism, or even WW3. And rather than share power with Russia and China they would sooner destroy half the planet as they believe a world war is winnable. Imagine looking at the world and there is a giant crater where Europe used to be.

When people stop buying the propaganda the mainstream media turn up the volume. Locked into ideological narratives on most issues the corporate journalists preferred option is to support government policy and double-down on their lies. Nowhere has this been more apparent than in the so-called Russiagate saga in the United States. Host Ross Ashcroft travels to New York to meet journalist Ben Norton from the Grayzone. He and his colleagues were steadfast in the face of collective delusion – so why didn’t they fall for the mainstream fallacy?

Paul Cockshott — What then is the escape from capitalism?

What then is the escape from capitalism?
What would be the essential features of a socialist economy, one the would be really achievable?
Exactly the right question. It's not just about there but getting from here to there. The former is utopian, the latter involves being realistic. This is not primarily a theoretical question but a practical one.

Marx concluded that capitalism is based on a monetary production economy, and that monetary production economies tend toward capitalism, as China suggests after the introduction of "market socialism" and "socialism with Chinese characteristics."

What would a socialist economy look like then? Paul Cockshott explains Marx's view on this based on "labor credits" as the unit of account. He also explains why he believes that the economic calculation problem that Ludwig von Mises advanced no longer applies owing to technological innovation.

This also has interesting implications for the MMT job guarantee that anchors the value of a currency to an hour of unskilled labor based on governments' power to set the price it is willing to pay in a market, provided the government is sovereign in its currency and has a monopoly on currency issuance. Currency sovereigns have monopoly power, hence, are price setters rather than price takers, regardless of whether they chose to use it.

Paul Cockshott's Blog
What then is the escape from capitalism?
Paul Cockshott

Dirk Ehnts — The problem with the supply curve

Eiteman and Guthrie conclude their paper with this statement: “If the beliefs of businessmen in general coincide with those included in this sample, it is obvious that short-run marginal price theory should be revised in the light of reality.” That was in 1952….
Another thing conventional economics reverses and gets backwards. "Reality is a bitch."

econoblog 101
The problem with the supply curve
Dirk Ehnts | Lecturer at Bard College Berlin

Sunday, April 28, 2019

Tim Radford — The $70-Trillion Climate Bill Coming Our Way

"But how will we pay for it?"

The bill for all the negative externality that has been socialized is coming due.

The $70-Trillion Climate Bill Coming Our Way
Tim Radford / Climate News Network

Jonathan Swan — Trump's dream is to spend close to $2 trillion on infrastructure

Behind the scenes: Trump came into office imagining a presidency in which new projects — "built by the Trump administration" — would be erected all over the country, sources close to him tell me.
  • "There was a genuine naïveté about the prospect of Democrats and Republicans coming together to do something on a grand scale with infrastructure," a former White House official told me. "It was one of those things where Trump said it was gonna be easy. He really thought so."
  • In an early 2017 infrastructure meeting at the White House with his friend, New York real estate billionaire Richard LeFrak, Trump laid out his grand Trumpian vision. "They say Eisenhower was the greatest infrastructure president. They named the highway system after him," Trump said, per a source who was in the room. "But we're going to do double, triple, quadruple, what Eisenhower did."
Now that would be something. So far though, politics has gotten in the way, as it did in uncutting President Trump's desire to improve relations with Russia ("Putin"). POTUS may be the most powerful man in the world, but he still can't get what he wants.

Trump's dream is to spend close to $2 trillion on infrastructure
Jonathan Swan

Bill Mitchell — Strong US growth disguises worrying trends

Bill analyzes the US private sector. He doesn't deal with the contribution of government, which is running record deficits, or the sectoral balances in this post.

Bill Mitchell – billy blog
Strong US growth disguises worrying trends
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Brian Romanchuk — Why Doesn't The Government Impose Taxes In Chickens?

Silly question? Brian is responding to someone who asserted that in effect government does. 

Actually, it used to be that government confiscated property to move it to government use, but that is no longer considered "proper," unless the police do it on other pretexts. In a monetary production economy, taxes are payable in "money," that is, the government's currency.

What David Andolfatto apparently means is that one's purchasing power declines as a result of taxation, which is true. But that is not all there is to it, as Brian points out. In addition, neoclassical assumptions come embedded in the assertion.

Physicist Richard Feynman famously pointed out that a major purpose of science is to keep us from fooling ourselves and we are the easiest one's to fool (because of cognitive-emotional bias). 

While David Andolfatto states the obvious at the household level with respect to barter, this is not actually what happens and that makes a big difference in the approach to economics.

Thomas Aquinas is famous for his paraphrasing of Aristotle in De ente and essentia, "A small mistake in the beginning becomes a big one by the end."

Framing counts. Get the framing wrong and miss the point.

Lars P. Syll — The interest rate fallacy

Another quote from the recently published MMT textbook.

Lars P. Syll’s Blog
The interest rate fallacy
Lars P. Syll | Professor, Malmo University

George Monbiot - Dare to declare capitalism dead – before it takes us all down with it

George Monbiot says capitalism is not working anymore, especially now as it is destroying the planet. It did for a while help us achieve great growth and improved our standard of living , but many people in the third world had their standard of living crushed as we grabbed their resources to we built our great society on.

The One Percent and the next 30% do well out of it, but for the bottom 30% it is hell.

In the 1930's people thought automation would produce the leisure society, but nowadays even with fantastic automaton and machinery going 24/7, 360 days a year, our time spent at work is going up again. Where's all the wealth going?

For most of my adult life I’ve railed against “corporate capitalism”, “consumer capitalism” and “crony capitalism”. It took me a long time to see that the problem is not the adjective but the noun. While some people have rejected capitalism gladly and swiftly, I’ve done so slowly and reluctantly. Part of the reason was that I could see no clear alternative: unlike some anti-capitalists, I have never been an enthusiast for state communism. I was also inhibited by its religious status. To say “capitalism is failing” in the 21st century is like saying “God is dead” in the 19th: it is secular blasphemy. It requires a degree of self-confidence I did not possess.

But as I’ve grown older, I’ve come to recognise two things. First, that it is the system, rather than any variant of the system, that drives us inexorably towards disaster. Second, that you do not have to produce a definitive alternative to say that capitalism is failing. The statement stands in its own right. But it also demands another, and different, effort to develop a new system.
The Guardian

Saturday, April 27, 2019

Michael Roberts — Progressive capitalism–an oxymoron

What is Stiglitz’s solution? “Things don’t have to be that way. There is an alternative: progressive capitalism. Progressive capitalism is not an oxymoron; we can indeed channel the power of the market to serve society.” You see, it is not capitalism that is the problem but vested interests, especially among monopolists and bankers. The answer is to return to the days of managed capitalism that Stiglitz believes existed in the golden age of the 1950s and 1960s.

How are we to return to the golden age of progressive capitalism?….
Michael Roberts Blog
Progressive capitalism – an oxymoron
Michael Roberts

Zero Hedge — Online Retail War Turns Ugly: Wal-Mart Responds To Amazon With Free 1-Day Shipping


Zero Hedge
Online Retail War Turns Ugly: Wal-Mart Responds To Amazon With Free 1-Day Shipping
Tyler Durden

Brian Romanchuk — Initial Comments On The New MMT Macro Textbook

Very brief first impressions.

Bond Economics
Initial Comments On The New MMT Macro Textbook
Brian Romanchuk

Friday, April 26, 2019

John Pilger - The Coming War On China

Everywhere you look the U.S. is starting another war.

The Coming War on China, from award winning journalist John Pilger, reveals what the news doesn’t – that the world’s greatest military power, the United States, and the world’s second economic power, China, both nuclear-armed, may well be on the road to war. Nuclear war is not only imaginable, but planned. The greatest build-up of NATO military forces since the Second World War is under way on the western borders of Russia. On the other side of the world, the rise of China is viewed in Washington as a threat to American dominance. To counter this, President Obama announced a ‘pivot to Asia’, which meant that almost two-thirds of all US naval forces would be transferred to Asia and the Pacific, their weapons aimed at China. A policy which has been taken up by his successor Donald Trump, who during his election campaign said “We can’t continue to allow China to rape our country and that’s what they’re doing”. Filmed on five possible front-lines across Asia and the Pacific over two years, the story is told in chapters that connect a secret and ‘forgotten’ past to the rapacious actions of great power today and to a resistance, of which little is known in the West.

TRNN - U.S. Hoped Putin Would be a ‘Sober Yeltsin’ - RAI with Stephen Cohen (3/5)

Yep, part 3 is excellent. Paul Jay tries to take a balanced view and is sometimes critical of Putin, but Stephen Cohen explains why Putin has done the things he has.

Paul Jay says that Putin could have had a referendum in Crimea and then not taken the country back but gone to the U.N to negotiate its future, but Steve Cohen says Putin was given two types of advice and one was what Paul Jay had described above, but other advisers told Putin that to stop a civil war he had to act now and take Crimea back immediately. Also, Putin was being seen as weak by some people in Russia by always being very diplomatic with the West, and his decision to take back  Crimea went down very well with the Russian public.

Cohen warns that the U.S. is playing a very dangerous game by pushing Russia, a nuclear armed power, into such a tight corner. Cohen warns of nuclear war.

Stephen Cohen agrees that Trump is bad but says obtaining peace with Russia is far more important. I couldn't agree more. 

TRNN - U.S. Hoped Putin Would be a ‘Sober Yeltsin’ - RAI with Stephen Cohen (3/5)

Here's a little bit of the interview. 
STEPHEN COHEN I don’t disagree. But that brings me to my final point, I guess, because we are at the time we are in. We now have, I think, at last count 19 or 20 Democratic would be contenders for the presidential nomination; 19 or 20. We need to ask ourselves which, if any, of these people see these dangers clearly, and ask them. But I have a feeling that the mainstream media will not ask them, because these are uncomfortable issues for them. I also think that the one candidate who has embraced a position similar to my own, Tulsi Gabbard, was immediately attacked by NBC, as you know. Scurrilously.
That it’s a question of what kind of discussion–because according to our democracy these existential issues that you and I have discussed are discussed during presidential campaigns. This is when we clarify and make our choices. It seems to me this is unlikely to happen, partly because the mainstream media doesn’t permit voices like mine any longer. Though they used to welcome me. I used to work for them. It would be interesting to see how they treat Tulsi Gabbard, who’s the closest to this kind of anxiety about the new Cold War with Russia, has taken positions on this. There may be others, but I haven’t–I haven’t noted that. We’ll see how they’re–if there’s an attempt to suppress her view, or to give her a fair time. Now, she’ll have to do well in a primary somewhere to get that. But it’s a little discouraging that of 19 or 20 Democrats, only one thus far has spoken with some clarity about this, what I consider to be the number one existential issue; the danger of war with Russia.

Max Blumenthal On America's Role In Spreading Terrorism

Max Blumenthal describes how the U.S funds Jihadist terrorism as its proxy army around the world. He adds that the Neocons back this on behalf of Israel, and the military-industrial complex see it as more business as usual. But he then goes on to say that the liberal-interventionists back these wars believing they are taking down bad regimes. Personally, I believe that liberal-interventionism  is just propaganda and a cover for the Neocons.

Max Bluthemthal describes the U.S. crime of destroying Libya and how they are trying to do the same to Venezuela.

What has Russia done compared to the U.S. asks Max Bluthemthal? Absolutely nothing in my opinion.

I've always liked Cenk Uygur and he seems to be becoming even more radical nowadays, which is good.

Thursday, April 25, 2019

Peter Joseph - Critique of Jordan B. Peterson (vs Slavoj Zizek: "Happiness: Capitalism vs. Marxism")

Peter Joseph dismantles Jordon Peterson's arguments about the merits of our present capitalism system. Peter Joseph says he's not a socialist, but his system is based on the cooperative and sharing, so it's sort of leftist.

Jordon Peterson says that government planned economies take away people's freedom, but Peter Joseph argues that the complete opposite is the case, because when the government provides the health service, a safety net, and other vital services, it liberates people. That is true.

And MMT will liberate people too, especially with the Job Guarantee.

Pepe Escobar — War on Iran & Calling America’s Bluff

Brinksmanship — or a ship of fools?

Consortium News
PEPE ESCOBAR: War on Iran & Calling America’s Bluff

Sam Fleming and Chris Giles — Why America is learning to love budget deficits

The trend towards looser fiscal policy could mark the biggest shift in economic thinking in a generation,,,,
Discussion of pros and cons in which MMT gets a play, of course.

Favorite paragraph:

“The winning formula for the Democrats is they are going to have to endorse some of these relatively fiscally extreme positions to get nominated,” says one Democratic strategist, speaking of the 2020 presidential contenders. “The threats of debt and deficits have not panned out. We have been running deficits and debt for 30 years and where is the crowding out, the inflation and the soaring interest rates?”
"The emperor has no clothes."

Financial Times
Why America is learning to love budget deficits
Sam Fleming and Chris Giles

Brian Romanchuk — Minsky Versus Steindl Debt Dynamics?

In Marc Lavoie's Post-Keynesian Economics: New Foundations, he has an interesting discussion in Section 6.10.4, which is labelled "Minsky or Steindl Debt Dynamics?" The Minsky dynamics are the well-known Financial Instability Hypothesis (link to primer), while the Steindl dynamics refers to the discussion in Maturity and Stagnation in American Capitalism by Josef Steindl. Lavoie's discussion raises some issues with the limitations of aggregated analysis in this context. This is a brief comment on this topic.…
In summary, we need to be cautious about putting too much emphasis on aggregate debt ratios as a shorthand for riskiness of borrowing.
Important for the topic itself but also as a demo of how care must be taken to include all the factors that are relevant to analysis. 

What appears to be a simple issue may be complicated by additional factors, or it may even be complex and therefore affected by emergence that can't be foreseen from the data. In a word, uncertainty rather than risk that can be projected by probability and statistics. 

This pertains to non-ergodic systems like social systems, and to a lesser degree biological systems, as evolutionary theory shows. The more psychology enters into the picture, the less ergodic the system.

Rules of thumb are just that and no more — heuristic rather than analytic.

Bond Economics
Minsky Versus Steindl Debt Dynamics?
Brian Romanchuk

Bill Mitchell — Eurozone horror story continues

Eurostat released the latest fiscal data for 2018 on Tuesday (April 23, 2019) which showed that – Euro area government deficit at 0.5% and EU28 at 0.6% of GDP – apparently a cause for celebration if you can believe the news reports that have accompanied the data release. The problem is that these numbers are meaningless without a context. And a relevant context is how well the monetary system is accommodating the advancement of material well-being among the citizens of Europe. On that ‘functional’ criterion, the horror story, more or less continues. Data relating to the real world (as opposed to the world of fiscal numbers on bits of paper) tell us that the damage from the GFC interacting with a dysfunctional monetary system design still lingers and the 19 Member States are still highly vulnerable to the next crisis. The austerity mindset remains and these fiscal outcomes indicate a failure of policy. Nothing to celebrate at all....
The only ones celebrating are the elites. They are doing fine, thanks to rent extraction.

Bill Mitchell – billy blog
Eurozone horror story continues

Debt, deficits and good housekeeping: what’s the fuss about?
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Wednesday, April 24, 2019

Jeff Spross — Why canceling student debt could be good for everyone

It's difficult to project precisely what the overall economic impact of this would be. Student debt is distributed all up and down the income ladder, and people at different income levels will spend or save the freed up money in varying proportions — it's the spending that will juice job growth and economic activity. But a Levy Institute paper from early 2018 — written by economists Scott Fullwiler, Stephanie Kelton, Catherine Ruetschlin, and Marshall Steinbaum — took a crack at figuring it out.
The Week
Why canceling student debt could be good for everyone
Jeff Spross

Lars P. Syll — Noah Smith’s new MMT critique — more nonsense on stilts

Noah Smith assumes that the methodological question has been decided in favor of formalism.

Lars P. Syll’s Blog
Noah Smith’s new MMT critique — more nonsense on stilts
Lars P. Syll | Professor, Malmo University

Branko Milanovic — Shadows and lights of globalization

To think correctly about globalization one needs to think of it in historical context. This means seeing today’s globalization and its effects, positive and negative, as in many ways a mirror-replay of the first globalization that took place from the mid-19th century to the First World War....
That globalization was grounded in imperialism and colonialism.  WWI was the culmination of this, and the aftermath was its dénouement. That led to the rise of neo-imperialism and neo-colonialism.

After the provocative lede, Branko Milanovic goes on to discuss economic aspect of this cycle, but he fails to note that together with the rise of Asia now taking place, the Western elite led by the US that has been favored for centuries is seeking to stymie the rate of that growth in order to maintain its dominant position. This is creating not only economic tension but also potential military confrontation as a new Cold War heats up, ostensibly against Russia but in reality to contain the rise of China as the "central realm" historically.

Global Inequality
Shadows and lights of globalization
Branko Milanovic | Visiting Presidential Professor at City University of New York Graduate Center and senior scholar at the Luxembourg Income Study (LIS), and formerly lead economist in the World Bank's research department and senior associate at Carnegie Endowment for International Peace

American Banker — Citigroup's Corbat says income inequality keeps him up at night

Is Wall Street getting the message that "capitalism" is not working in that prioritizing capital over the rest of the factors of production is resulting in not only economic issues but also social dysfunctionality and political polarization? This is also affecting US foreign policy adversely as the American leadership forces "capitalism" on the rest of the world regardless of other considerations, leading to a breakdown of globalization, a diminishment of world trade, and increasing nationalism.

Capitalism" is also the basis for increasing negative externality that is culminating in an existential threat to life on the planet. As this becomes more widely recognized, the blowblack is affecting perceptions of "capitalism" as shown by a rising interest in "socialism."

American Banker
Citigroup's Corbat says income inequality keeps him up at night

Barclay Ballard — Modern Monetary Theory continues to gain traction in the US

For too long, citizens have been told that the government cannot afford to invest more in education, healthcare, infrastructure and other public services. At the same time, they have seen governments find money to pay for tax cuts, bank bailouts, military activities and other programmes that they likely deem to be less essential.
MMT asks that instead of worrying about their balance sheets, governments start looking at ways to use the resources at their disposal in the most efficient way possible. According to the theory, generating full employment, creating a more equal society and fortifying our education systems are all possible without causing rampant inflation. It is not a question of being able to afford it – it is a question of political will.…
World Finance
Modern Monetary Theory continues to gain traction in the US
Barclay Ballard

Lars P. Syl — Vickrey on deficits and obfuscatory financial rectitude

Keeper quote by William Vickrey.

Lars P. Syll’s Blog
Vickrey on deficits and obfuscatory financial rectitude
Lars P. Syll | Professor, Malmo University

Bill Mitchell — Banque de France should write off its holdings of State debt

Wednesday today and a short blog. I also have to travel a lot today. But some brief comments on an interesting article from French commentator Michel Lepetit – Nourrir le débat sur une annulation partielle (370 mds€) de la dette publique (April 15, 2019) – which means more or less “Promoting the debate on a partial cancellation (€370 billion) of public debt”. The article proposes that the Banque de France cancels its holding of French government debt (the €370 billion), which could also lead other national central banks in the Eurosystem following suit with respect to their own government debt holdings. He argues that the cancellation (write off) would have no negative social impacts and could help Eurozone governments fund the transition to a low-carbon future. Above all, it reflects an understanding of Modern Monetary Theory (MMT). Michel Lepetit argues that the QE implemented by central banks, especially since the GFC demonstrates the patent failure of the foundations of monetarist dogma (“l’échec patent des fondements du dogme monétariste”).…
Is consolidation of accounts within a single entity like government actually "debt cancellation"? Why not standard accounting practice?

Bill Mitchell – billy blog
Banque de France should write off its holdings of State debt
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Tuesday, April 23, 2019

TRNN - Modern Monetary Theory - A Debate Between Randall Wray and Gerald Epstein

There are four parts of this video.

The Real News Network

Modern Monetary Theory - A Debate Between Randall Wray and Gerald Epstein

PAUL JAY: Hi. Welcome to The Real News Network. I’m Paul Jay.
With the development of this concept of a Green New Deal, and there’s much more attention being paid to it now that it’s being talked about in the halls of Congress, especially people like Alexandria Ocasio-Cortez, the question of how to pay for a Green New Deal has become to the fore. And part of the Green New Deal is the idea of a full employment plan. These two things have been connected. And it’s of course not new, but far more in the spotlight than before. And one of the ways to pay for it that’s being presented, including by Ocasio-Cortez, AOC has hinted at this, is an idea that has been called Modern Money Theory or Modern Monetary Theory. And if I understand it correctly, essentially it recognizes what is clear, which is the government creates money when it needs it. And many times the government spends money, for example, this new military budget or a massive tax cut, without clearly showing that if you’re taking a dollar from here, you’d better find it from over there.
In fact, the government kind of just makes up the money, the deficit grows, and sometimes austerity hawks scream about it, and other times they seem not to care about the deficit. So the idea of MMT, if I understand it correctly, is this same kind of concept can be applied to the Green New Deal, to developing what would be essentially a full employment program, and that the way to fund it is create the money, but within certain limits. When you start to reach full employment or when inflation starts to get above, say, six percent, one could argue about what the two limits should be, then you need to rein things back in again. But there’s a lot of debate. This theory is being attacked from a more conservative right position, and there’s also a lot of debate amongst left economists about MMT. So we are creating a series of interviews with people that are kind of pro-MMT, people that are critical, and we’re going to put them up and hopefully have some panels and debates, and people can decide for themselves what they think of this.
So now joining us is one of the, I would say, fathers of modern MMT, anyway, Modern Modern Monetary Theory, is Randall Wray, and he joins us. He is Professor of Economics at Bard College, he’s a Senior Scholar at the Levy Economics Institute of Bard College. He’s the author of many books, including Modern Money Theory: A primer on of macroeconomics for sovereign monetary systems. Thanks for joining us.

John Ross — Why China maintained its strong economic growth

The reason this is crucial is set out in the article below. It shows in a detailed way that it is investment, and not any other major factor in the economy, which controls China’s rate of economic growth – as it does in other major economies. In addition to its medium-term effect it was the fall in fixed investment which led to the economic slowdown in the second half of 2018, and the upturn which led to the good results in the first quarter of 2019 and in March in particular. Quantitative analysis of the data therefore confirms that it is fixed investment which is the most powerful factor in China’s medium-term economic development and its short-term macroeconomic regulation....
The article also contains an explanation of how the US approach to trade involves hybrid warfare. Hybrid warfare leads with economic warfare and information warfare, followed by cyberwarfare (although cyberwarfare is ongoing under the guise of intelligence gathering), and only then moves on to kinetic warfare if hybrid warfare does not accomplish the objectives, or if the adversary responds.


Socialist Economic Bulletin
Why China maintained its strong economic growth
John Ross

Ramanan — Mainstream Economics Compared To Keynesian Times

Nicholas Kaldor quote.

The Case for Concerted Action
Mainstream Economics Compared To Keynesian Times
V. Ramanan

Bill Mitchell – billy blog Ridiculous MMT critiques distorting Scottish independence debate

In a few weeks I am off to Britain again to participate in a series of events. Two of these events will be in Scotland where we (Warren and I) will discuss, as outsiders, issues pertaining to the monetary arrangements that might accompany a move to Scottish independence. It is a controversial issue in itself, but, unfortunately, is also intertwined with the vexed issue of EU membership. And the complication then becomes that progressives, who might otherwise be attracted to the Modern Monetary Theory (MMT) way of understanding the monetary system, also exhibit the standard misconstrued Europhile view that the EU, neoliberal though it is, can be reformed and that an independent Scotland should be part of that mess. And, in doing so, they then take problematic positions on the currency question. So a sort of ‘nest of vipers’ sort of situation, from the Aesop’s fable – The Farmer and the Viper. As in the Fable, the Europhiles embrace of the EU will always pay them back in grief. Anyway, while I am always cautious discussing the pro and con of situations where I have no direct material stake and a less than full understanding of specific cultural and historical influences that are at work, the Scottish question is interesting and demonstrates many of points that nations should be cogniscant of when discussing monetary sovereignty. And besides I have to get up in Edinburgh and Glasgow in a few weeks so as a researcher I am trained to be prepared and seek the best understanding that I can of the complexity of the situation. I will be writing a few posts on the Scottish issue as I prepare for that speaking tour....
Bill Mitchell – billy blog
Ridiculous MMT critiques distorting Scottish independence debate
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Monday, April 22, 2019

Pepe Escobar — China’s road to a win-win ahead of BRI forum

Relentless reports that the New Silk Roads, or the Belt and Road Initiative (BRI), are a perfidious neo-imperial debt trap set up by Yellow Peril 2.0 are vastly exaggerated.

With less than one week to go before the next BRI forum in Beijing, a quick overview of what’s been happening in Europe and Southwest Asia may be quite enlightening....
The BRI is set to bring the lagging economies (and societies) in Asia into the 21st century in a way similar to the dynamic growth of China since the Deng era, but free of Western control, unlike Japan and South Korea. Europe has no choice but to join. And if the US doesn't change its imperialistic approach, the rest of the South (Latin America and Africa) is headed that way, too.

Asia Times
China’s road to a win-win ahead of BRI forum
Pepe Escobar

FRBSL — Meet the People behind FRED

Backgrounder on the economic data charting service provided by the Fed — making economic data free for all.

On the Economy — FRBSL
Meet the People behind FRED

Richard Murphy — Two proposals for reform

Two proposals from Richard Murphy.

Tax Research UK
The argument for fundamental reform of accounting as well as auditing goes on

Tax to Save The Environment: a land value tax with a woodland twist
Richard Murphy, Professor of Practice in International Political Economy at City, University of London, and chartered accountant.

Lars P. Syll — Schumpeter–an early champion of MMT

Keeper quote from Joseph Schumpeter. He nailed endogenous money as "credit money" and observed correctly how "money" gets created by banks' extending credit — "they create deposits in their act of lending." This effect is now amplified through non-bank and quasi-bank financial institutions.

The contemporary financialized economy runs largely on privately created credit. This has an even greater effect than Schumpeter likely anticipated. Economists' ignoring this unduly limit the scope of their models by failing to include money & banking, and finance. The result is "surprise resulting from exogenous shock." In other words, the conventional economists were looking in the wrong direction owning to oversimplification of their models of an economy. 

To say that this resulted in "great embarrassment of the profession in the fallout from the global financial crisis would be an understatement. But conventional economists still have not dealt with it by including a correct approach to money & banking and finance. Nor have institutional arrangement been changed to prevent a repeat, perhaps on an even grander scale.

Hyman Minsky was a student of Schumpter at Harvard. Minsky drew out some conclusions from Schumpter's view that became the financial instability hypothesis. Randy Wray, MMT economist and perhaps the most published author on theory of money, was a student of Minsky.

Although Schumpeter eschewed being associated with any particular economic school of thought, he is often considered as belonging to the Austrian school of economics and he was an Austrian national. Hyman Minsky also eschewed association with a particular economic school, but he is often characterized as a Post Keynesian.

MMT has roots in many previous economists and economic schools, although it is usually associated with the Post Keynesian. But here is Wray associated with Schumpeter through Minsky. MMT economists also acknowledge their debt to Abba Lerner, a student of Friedrich Hayek who is generally associated with the Austrian school of economics, too.

Incidentally, the chapter in which this quote occurs is worth reading in full. Here is the citation:

Joseph Schumpeter, History of Economic Analysis, Allen & Unwin, 1954, reprinted by Tayor & Francis, 1986, p. 1080
in CHAPTER 8 Money, Credit, and Cycles, 7. BANK CREDIT AND THE ‘CREATION’ OF DEPOSITS, pp. 1076-1083.

Schumpeter doesn't take credit for originality in this, citing Keynes's Theory of Money, for example. He does criticize Keynes for again mudding the waters in the General Theory. See footnote on page 1080.

Lars P. Syll’s Blog
Schumpeter — an early champion of MMT
Lars P. Syll | Professor, Malmo University

Sunday, April 21, 2019

Democracy Now - The Mueller Report: Glenn Greenwald vs. David Cay Johnston on Trump-Russia Ties, Obstruction & More

Well, talk about entrenched positions (Credit Writedowns post below).

Here, Glenn Greenwald knocks out David Cay Johnstone who insists that Trump is guilty.  Johnstone says that just because there is no evidence it doesn't mean Trump didn't collude with the Russians. Glenn Greenwald completely calls him out, but David Cay Johnstone sticks to his guns.

Glenn Greenwald  agrees with David Cay Johnson that the Russians wanted Donald Trump to win, just as in the past the Americans wanted Yeltsin to win in Russia, and he says there's nothing  with that, except the US did meddle in the Russian elections to help put Yeltsin in power.

 Johnstone mentions how Hillary was insistent that she was going to do everything the take Crimea back from the Russians, and so the Russians wanted Trump to win.

Paul Craig Roberts (in another video) talks of the utter hypocrisy of the West which has destroyed so many countries in the ME leaving a bloodbath behind, and asks, what has Russia done compared to that, where the Crimeans peacefully welcomed them in?

David Cay Johnstone says that as Trump tried to stop the report as well as try to cover up for himself it means he is guilty of something and says that this is evidence of collision -  although no evidence has been found. What this means is that the Democrats seem to be saying is that Trump is guilty until proven innocent.

George Galloway says to never trust a liberal as they are just lipstick on a pig of the empire. Wash away the lipstick, and you will see the rotten empire.

The Justice Department has released a redacted version of special counsel Robert Mueller’s 448-page report detailing Russian meddling in the 2016 election, the Trump campaign’s contacts with Russia and President Trump’s attempts to impede the special counsel’s investigation. The report states the campaign “expected it would benefit electorally from information stolen and released through Russian efforts,” but Mueller concluded, “the investigation did not establish that members of the Trump campaign conspired or coordinated with the Russian government in its election interference activities.” Mueller also outlined at least 10 instances where Trump attempted to impede the special counsel’s investigation, but Mueller came to no definitive conclusion on whether Trump broke the law by obstructing justice. In the report, Mueller suggests that this is a decision for Congress to make. We host a debate on the report’s findings between two Pulitzer Prize-winning journalists: Glenn Greenwald of The Intercept and David Cay Johnston, who has covered Donald Trump since the 1980s. His most recent book is “It’s Even Worse Than You Think: What the Trump Administration Is Doing to America.”

Credit Writedowns - Division and divisiveness in the 21st century

This is interesting: How we become entrenched in our opinions, and if we lose in a debate about politics with someone we will experience extremely stress, then do more research, scan the internet, talk to friends who hold our opinion, and then come back with our position strengthened. We never lose our arguments for long. But is America becoming more divided and could it result in civil war?

The Backfire Effect

For a long time now, I have realized that so-called incontrovertible evidence doesn't change the views of hardened partisans. In fact, evidence contradicting their views only further cements their most fervent beliefs. Why? It's called the Backfire Effect. What happens is that someone with strongly held views, when faced with evidence that severely undercuts those views, goes through a period of severe cognitive stress. They are then forced to reconcile their pre-existing worldview with the new information. And what usually ends up happening is the new information loses that reconciliation, ironically reinforcing the existing pre-conceptions.

I first learned that this is how we deal with cognitive dissonance on important issues in 2011 via this article. And since then, I have consistently tried to ascertain where I am employing the Backfire Effect to protect my ego and sense of self in order to come up with more nuanced, self-aware and forward-looking analysis.

I shared this with a friend this morning. And he sent me a good 2015 articlefrom the FT by John Kay. The biggest takeaway from the article for me was this:
It is generally possible to predict what people will think about abortion from what they think about climate change, and vice versa; and those who are concerned about wealth inequality tend to favour gun control, while those who are not, do not. Why, since these seem wholly unrelated issues, should this be so? Opinions seem to be based more and more on what team you belong to and less and less on your assessment of facts.

Saturday, April 20, 2019

Mark Curtis: The System is working perfectly

Prince Khaled bin Bandar bin Sultan, Saudi ambassador to the UK

Mark Curtis - Prince Khaled, the new Saudi ambassador to the UK, is the son of the former Saudi intelligence chief, is a graduate of Sandhurst and Oxford and is married to the niece of the 12th Duke of Northumberland. The system is working beautifully.

Prince Khaled has also served his country as an adviser to the Saudi ambassador to the US for three years

Prince Khaled bin Bandar bin Sultan, the Saudi ambassador to the UK, has thanked King Salman and Crown Prince Mohammed bin Salman for giving him the responsibility.

Prince Khaled bin Bandar bin Sultan, Saudi ambassador to the UK

NonCompete - Why I'm a libertarian (........SOCIALIST)

This guy is interesting. In this video he explains why he changed from being a right-wing libertarian to a left-wing libertarian. He says he hasn't changed his views much about anything at all and still believes in equality, freedom, and liberty, but he doesn't believe that capitalism can bring these ideals about anymore.

He was once a capitalist and businessman who had started six different businesses over the last 20 years, but he now thinks the capitalist class have too much power - even more power than the government - and so this, just as much as big government, needs to be addressed too, he says.

Friday, April 19, 2019

Robert Vienneau — Some Experts On The Cambridge Capital Controversy

For those interested in the CCC.

Thoughts On Economics
Some Experts On The Cambridge Capital Controversy
Robert Vienneau

Share of wealth of bottom 90% in various countries

ht Real World Economic Review

J.Hawk, Daniel Deiss, Edwin Watson, Harold Hoover — RUSSIA 2019+ MILITARY DOCTRINE

Video and transcript.

J.Hawk, Daniel Deiss, Edwin Watson, Harold Hoover

Brian Chappatta —Fed Should Buy Muni Bonds to Fight the Next Recession

Say what you will about modern monetary theory, but it’s worth asking why it’s assumed that states in America, which wields the power of the world’s reserve currency, should turn to draconian austerity measures when the going gets rough. After all, no political party at the federal level even pretends to care about budget balance anymore. Governors, on the other hand, must spend within their means and consider trade-offs, whether they’re a Democrat or Republican. To their credit, many have chipped away at long-term problems. 
When the next recession comes around, though, they might not have the tools to go at it alone. They’re going to need a lift. The Fed should stand ready to provide that boost.….
NewsMax Finance
Fed Should Buy Muni Bonds to Fight the Next Recession
Brian Chappatta | Bloomberg Opinion columnist covering debt markets, previously covered bonds for Bloomberg News, and is a CFA charterholder

TRRN - Is Trump for Detente With Russia and Militarism With China and Iran? - RAI with Stephen Cohen (2/5)

A lively debate between Paul Jay and Stephen Cohen where they essentially agree but spar a little at times. It's a terrific interview, and part 3 looks like it will be even more riveting.

STEPHEN COHEN: I live in a social realm–to the extent that I have any social life at all anymore– where people get very angry if I say, or anybody says, anything positive about Donald Trump. When Trump was campaigning in 2016, he said, “I think it would be great to cooperate with Russia.” All of my adult life, my advocacy in American foreign policy–I’ve known presidents, the first George Bush invited me to Camp David to consult with him before he went to the Malta Summit. I’ve known presidential candidates, Senators and the rest, and I’ve always said the same thing. American national security runs through Moscow, period. Nothing’s changed.

In the era of weapons of mass destruction, not only nuclear, but primarily nuclear, ever more sophisticated, the Russians now have a new generation of nuclear weapons–Putin announced them on March 1, they were dismissed here, but they’re real–that can elude any missile defense. We spent trillions on missile defense to acquire a first strike capability against Russia. We said it was against or Iran, but nobody believed it. Russia has now thwarted us; they now have missile defense-evading nuclear weapons from submarines, to aircraft, to missiles. And Putin has said, “It’s time to negotiate an end to this new arms race,” and he’s 100 percent right. So when I heard Trump say, in 2016, we have to cooperate with Russia, I had already become convinced–and I spell this out in my new book, War with Russia?–that we were in a new cold war, but a new cold war more dangerous than the preceding one for reasons I gave in the book, one of them being these new nuclear weapons.

So I began to speak positively about Trump at that moment–that would have been probably around the summer of 2016–just on this one point, because none of the other candidates were advocating cooperation with Russia. And as I told you before, Paul, all my life I’ve been a detente guy. Detente means cooperate with Russia. I saw in Trump the one candidate who said this is necessary, in his own funny language. Mrs. Clinton, on the other hand, was very much a hawk. When she said publicly that Vladimir Putin has no soul, you could not commit or utter a more supreme statement of anti-diplomacy, and particularly addressing the Russians, who put a lot of stock in soul. To say somebody has no soul and then go on to equate him with Hitler, I found that so irresponsible. I didn’t vote for Trump, but I did begin to write and broadcast that this was of vital importance that we have this discussion, that we needed a new detente because of the new and more dangerous Cold War.

Since he’s been president, I think he’s been ineffective in regard to pursuing detente with Russia for a couple of reasons. I think that the people who invented Russiagate were the enemies of detente, and they piled on. So they’ve now demonized Russia, they’ve crippled Trump. Anything he does diplomatically with Putin is called collusion. No matter what Mueller says, it’s collusion. This is anti-democracy, and detente is pursued through democracy. So whatever he really wants to do–it’s hard to say–he’s been thwarted. I think it’s also one of the reasons why he put anti-detente people around him.



James K. Galbraith — Capitalism’s Great Reckoning

As the maladies of modern capitalism have multiplied, fundamental questions about the future of the world’s dominant economic model have become impossible to ignore. But in the absence of viable alternatives, the question is how to reform a system that is increasingly at odds with democracy.
James K. Galbraith looks at three recent books on the crisis in capitalism:
Project Syndicate
Capitalism’s Great Reckoning
James K. Galbraith | Lloyd M. Bentsen Jr. Chair in Government/Business Relations and Professor of Government at the Lyndon B. Johnson School of Public Affairs, The University of Texas at Austin

TRNN - Clinton-Era Official Says Left Should Lead Following Center-Right Failures

Brad DeLong says left-neoliberalism has failed and so it's time for the liberals to stand aside and let the socialists take over. Brad DeLong says that the Left have the most accurate description of the world, not the liberals.

The left neoliberals were conned by the right, says Bill Black,  when the conservatives said that free markets would mean that those business people with integrity and honesty wound win in the market place because consumers would soon know who the con- men were and would avoid them, but this didn't happen, the bad actors cleaned up.

Laissez-faire might work when it comes to the local high-street with its baker shop, the coffee bar, or the small business, with people you know, but not when it comes to the wider economy. In other words, libertarianism and laissez -faire capitalism is a fantasy. 

BILL BLACK: Well, he actually says what it means. He says we are discredited. Our policies have failed. And they’ve failed because we’ve been conned by the Republicans. Our whole strategy was to form a consensus with some reasonable, moderately conservative Republicans. And there is no such thing. And as a result we kept on pushing farther and farther and farther to the right with our policies, so that we’re actually to the right of the Republican Party’s own representatives in Congress. And again, we’ve just basically been played by these folks. We have to stop doing that. The only legitimate entity in town is the left, the progressives. The progressives, he says, are wonderful people, whereas basically, he says, there isn’t a single elected Republican that has any integrity at the federal level. And we have to start anew.
He also says that the progressive view of the world poved to be much more true than the neoliberal. He calls himself the neoliberal shill. And in his column, he says the left’s view of the world is much more accurate than our view of the world proved to be.
MARC STEINER: So is he saying that his whole thinking about politics and the economy have changed? Or is he saying that we don’t have the answers, and we should give them a shot at the answers, and back them up with our thinking? What do you think he’s saying?
BILL BLACK: So, he’s saying two things. One, he says–and he says this flat-out–politically, we failed. We were a disaster. Everything we did was a disaster politically. Economically, he says, again, the left’s view of the world is a lot more accurate than ours was. So a number of our policies, presumably, really need to be changed, even just in terms of the economics.
Let me give you the key point. He says our view, the neoliberal, was the markets would regulate themselves. Our view, which we–you know, I’ve been arguing with him for years–is no; markets, when there’s a Gresham’s dynamic–in other words, the kind of frauds that I write and warn people about–market forces become perverse. Cheaters gain a competitive advantage, and bad ethics drives good ethics out of really any form of competition, whether that’s markets, professions, or sports. The steroids era, for example, in baseball, where you had to cheat to be able to do. Or the Tour de France, where all the winners for 20 years were cheats, doing blood doping and other drugs.
MARC STEINER: So I mean, there’s one quote that kind of sums up for me. When he wrote: “Barack Obama rolls into office with Mitt Romney’s healthcare policy, with John McCain’s climate policy, with Bill Clinton’s tax policy, and George H.W. Bush’s foreign policy. And did George H.W. Bush, did Mitt Romney, did John McCain say a single good word about anything Barack Obama ever did over the course of eight solid years? No f’n way he did not,” is what he said. Cleaned it up just a little bit. But that kind of sums up, in many ways, exactly what he was saying.
BILL BLACK: Brad DeLong is brilliant. And he writes really well. And he has, in a super short form, captured it exactly. All of Obama’s key policies were the product of very conservative views that are, on many economic fronts, literally to the right of these crazies that are the Republicans who constitute the House and the Senate. And even when they’re not to the right of the crazies, they’re way, way right, and they’re inferior. Right? The progressive policies are fundamentally superior. Market regulation is a terrible failure. It is criminogenic.
I’ll give you one example. He ends by saying wouldn’t it be a wonderful thing if we could use cap and trade to create an incentive for, you know, 20-plus million people to do the right thing? Because again, the neoliberal view is if they do the right thing they will get a profit. See? It’ll all be wonderful. They’ll all do the right thing. Except that it’s vastly easier on something like cap and trade to do the wrong thing. To lie, to commit fraud about whether you’re actually reducing the pollution, and collect the fees. And so he doesn’t realize, still, I think, that we are incentivizing not 20 million people to do the right thing, but literally 2 billion people to do the wrong thing. And you know, often that will be the result, the wrong thing.
Naked Capitalism

TRNN - Clinton-Era Official Says Left Should Lead Following Center-Right Failures

Thursday, April 18, 2019

The Saker Interviews Dmitry Orlov

Backgrounder on empire. Dmitry Orlov is able to recount the story of a civilizational tragedy unfolding in the course of history in a a (darkly) humorous way, replicating many similar stories of a wave rising, cresting and breaking on the beach as the next wave rises behind it. Orloff doesn't make any predictions about the dénouement, but it looks like it gets ugly, especially as the vise jaws of climate change tighten.

KV - The Failure of Neoliberalism and the Poverty in Britain.

 ITV Report: Pupils ‘have not eaten for two days’ and parents 'too poor' to buy new clothes, teachers say

Britain is one of the richest countries in the world - but only for some!

After the onslaught of Thatcherism, some people in the left gave up on socialism and embraced free markets instead, believing that this freedom would liberate people. They also believed that a true free market would bring down prices when more companies were able to compete with the big corporations, but the left intellectuals just ended up being no different to the Thatcherite right. They had flipped becoming economically right-wing and now some very rich people support their think tanks. 

Some left think tanks, like The Centre of the Stateless Society, believe that corporations and governments work together to keep workers wages low, but there is nothing socialist about neoliberal free markets, and these groups are not on the economic left anymore, if they ever really were, although they may be socially liberal. 

Clair Fox was a member of the of the Revolutionary Communist Party and she embraced libertarianism 20 years ago, saying that a completely privatised economy was Marxist as it gave power to ordinary people. She wanted more Thatcherism, but she still maintained that she was a communist. 

It all sounds very nice:

No 'big bureaucratic government' and only individuals who know what their local society really  needs. Like all propaganda, this is true to a point, but when it leaves a third of the UK population in terrible poverty and causing mass poverty around the world, then you know we've been sold a pup.

It is true that government can be inefficient, but super efficient healthcare can be good at making profits, but lousy at providing healthcare because the motives are all wrong. Providing good health care should over ride profits. 

It is true that governments can get corrupted by the wealthy, but that is not an argument to do away with it, instead we need to improve government. It can be done. 

Some new ideas being used by councils in Britain is to get the public involved more by giving them shares in some of the council run local industries, and so along with providing low cost public services, the public gets a stake in the services too. There are members of the public sitting on the boards of some of these companies who ensure that they are run efficiently and are a benefit to the community. They keep services in house and local where they can, which helps with the employment in the area, but they only do this if it is efficient, otherwise they will outsource, and so this is not 'inefficient socialism', but pragmatism. 

In the book, The Private Abuse of the Public Interest: Market Myths and Policy Muddles, professors Lawrence D. Brown and Lawrence R. Jacobs, show how privatised services cost two to three times more to run than they did as public utilities. One reason is because it takes a lot of government resources to ensure these companies are providing a proper service because left to themselves they will continuously cut back until the service is in danger.

Free markets have their place and can provide terrific goods and services for the public in many areas, but it's about getting the balance right - a mixed economy. 

MMT is about getting the government more involved in public provision, and it makes good economic sense.

Free markets are good at providing things that can be easily judged for their value, like food, cars, Hi-Fi, phones, cameras, etc, but when it comes to schools, pensions, health care, etc, the public can be easily hoodwinked by the private sector. But when you have a team of professionals and academics working on behalf of the government, they can negotiate much better prices for health care, pensions, schools materials and services, etc, and as they will be buying for the whole population, they can also bring prices right down too. Plus, the academics will go through all the small print to make everything is okay, the sort of thing that can overwhelm a lot ordinary people. 

In the book, In Government We Trust: Market Failure and the Delusions of Privatisation, the professors of accountancy, Warwick Funnell, Robert Jupe, and Jane Andrew show how in Britain privatisation has made services more expensive.

ITV report on child poverty. 

Some pupils “have not eaten for two days”, teachers have said, as child poverty concerns continue to rise.

Teachers are reporting a “significant increase” in child poverty, including pupils arriving at school after days without eating or with holes in their shoes.

The findings are part of a UK survey of more than 8,000 teachers, school leaders and support staff ahead of the National Education Union’s (NEU) annual conference in Liverpool this week.

More than half of members said their students had experienced hunger (57%) as a result of poverty.

One teacher reported “most of my class arrive at school hungry and thirsty” and another said “some students have mentioned that they have not had any food for two days, some come without having breakfast and with no dinner money but are not on free school meals”.

Nearly half a million food bank parcels given out in 18 months, figures show
Families need more support in early years to give children ‘best possible start’
UK ‘lagging behind other countries’ on young people’s health
Parents being too poor to buy new clothes or keep them clean was also a big issue, with reports of children coming to school with “holes in their shoes or cheap shoes which are not weather proof… with no coats, no socks and without other essential items of clothing.”

Another added: “Several wear clothing that is ill-fitting or not clean.

“Shoes are often ill-fitting or very worn, coats are often inadequate for weather.”

NEU joint general secretary Mary Bousted said the Government was “failing to recognise the human costs of its actions” of austerity policies.

It is truly shaming for the UK, one of the richest countries in the world. A decade of austerity has only served to place more children in poverty, while at the same time destroying the support structures for poor families.

ITV Report on UK Child poverty/

The Independent: Poverty-hit pupils so ashamed of worn-out clothes and lack of equipment they skip school, teachers say

‘It is truly shaming for the UK – one of the richest countries in the world,’ union leader says

Students are avoiding school for fear of being bullied over their worn-out clothes and lack of school equipment as child poverty worsens, teachers warn.
Half of school staff say child poverty and low income is having a significant effect on students’ ability to learn, according to a National Education Union survey of more than 8,600 teachers.
More than half of the teachers say their students had experienced hunger or ill health as result of poverty, and more than a third (35 per cent) said students had been bullied because of it.
One teacher said non-uniform days had become “very sad days” for poorer children who are noticed by their classmates, adding that some pupils are reluctant to attend on those days.   Another teacher added that children are shamed by their fellow pupils for not having “nice clothes or shoes”.
The Independent 
Poverty-hit pupils so ashamed of worn-out clothes and lack of equipment they skip school, teachers say

Center for a Stateless Society: A Left Market Anarchist Think Tank & Media Center