Economies are human constructs, not inevitable natural phenomena. Humans make up the rules that participants must follow when playing the game, and as the economy grows and evolves, humans must change the rules of play in ways that optimize the well-being of the majority of participants. In this piece, we argue that the MMT fiscal policy proposition of government spending into the private sector, with inflation being the only limiting factor, is not only needed for a real recovery from the great recession but is inevitable.
We have been pounding the table publicly since 2015 and privately since 2009, with the assertion that monetary policy alone was not enough to optimize the economy for the benefit of the majority. We have repeatedly pointed out that lowering interest rates (to encourage credit creation) and buying financial assets (to save the banks), while necessary, were not sufficient to engineer an economic recovery for the masses. Fiscal policy, that delivers money to the base of the economic-pyramid, was missing....Seeking Alpha
It Is Inevitable
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Economics is not just a science, and although it is scientific, it is a lot smarter than that.
ReplyDeleteEconomics is to be tweaked to get the best outcomes for most people. Economics that only looks at efficiency is inhuman. Efficiency can give us a guideline, but then we have to add the human element.
We are smarter than machines, and AI. Animals and plants are not biological machines, as some cold reasoned scientists argue. So we need an economic system that is human, not machine like.
We have feelings and are sentient, and economics that is a pure science of efficiency can't cover that level of sophistication, or nuance.