An economics, investment, trading and policy blog with a focus on Modern Monetary Theory (MMT). We seek the truth, avoid the mainstream and are virulently anti-neoliberalism.
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.
All across the United States, students are settling into college – and coming to grips with “Econ 101.” This introductory course is typically taught with a broadly reassuring message: if markets are allowed to work, good outcomes – such as productivity growth, increasing wages, and generally shared prosperity – will surely follow.
Unfortunately, as my co-author James Kwak points out in his recent book, Economism: Bad Economics and the Rise of Inequality, Econ 101 is so far from being the whole story that it could actually be considered misleading – at least as a guide to sensible policymaking. Markets can be good, but they are also profoundly susceptible to abusive practices, including by prominent private-sector people. This is not a theoretical concern; it is central to our current policy debates, including important new US legislation that has just been put forward....
Fitting post on Labor Day (US holiday celebrating working people). Worth reading in full. Unfortunately it is about saving capitalism from its excesses rather than overhauling it.
Why is capitalism in need of an overhaul. The term, "capitalism," explains it.
"Capitalism" is a socio-economic system that favors capital (property ownership) over the other factors of production, land (environment) and labor (those that work for a living). This "market-based" system is institutionally based, and as such politically based.
Classical liberalism was about reducing government intervention in the economy. Neoliberalism is about government capture through politics in order to favor the interests of capital.
Politics is influenced by a simplistic understanding of conventional economics, which has been called "economism" to distinguish it from economics. Econ 101 is more about promoting economism more than teaching economics in terms of models that are substantiated by events.
Simon Johnson | professor at MIT Sloan, former chief economist of the IMF, senior fellow at the Peterson Institute for International Economics, and co-founder of the blog, The Baseline Scenario
“There’s a fundamental problem with our economy. For decades, American workers have helped create record corporate profits but have seen their wages hardly budge,” Warren said in an announcement of the bill. “My bill will help the American economy return to the era when American companies and American workers did well together.”...
Whether the proposal would actually do that is going to be quite controversial.
At least is is about preemption and accountability, which is a step in the right direction.
"Money is going to drown our democracy, and if we don't start fighting back, and fighting back more aggressively, then we are part of the problem as well."
Well, what Clinton said will never, ever happen is now looking more and more possible. A number of prominent Democrats are lining up behind it, Sanders' bill for single-payer. Last week, Senators Elizabeth Warren and Kamala Harris jumped on board. Now, Senators Cory Booker of New Jersey, Jeff Merkley of Oregon, and Kirsten Gillibrand of New York are signing on as well. Bernie Sanders is set to unveil his Medicare for All Bill on Wednesday. Adam Gaffney is an Instructor in Medicine at Harvard Medical School and a member of Physicians for a National Health Program....
Aaron Mate interviews Adam Gaffney, Instructor in Medicine at Harvard Medical School, a pulmonary and critical care physician at the Cambridge Health Alliance,and secretary and member of the board of directors of the single-payer advocacy organization Physicians for a National Health Program
Several months ago Warren Buffet was on that piece of crap network, CNBC, where he took some time to complain about Elizabeth Warren saying her approach was too, "angry." Here were his words:
"I think that she would do better if she was less angry and demonizing. I believe in 'hate the sin but love the sinner.'"
All I can say is, you old fool, what a fucking joke you are. (And to think I used to like Buffett.)
Here's Senator Warren, fighting a courageous, almost one-woman effort against the egotism, corruption and FRAUD of the entire financial sector, of which, Buffett is a part and there's Buffet telling her to talk nice. All the while his criminal friends have been allowed to fuck over 99.9% of the population for decades without anything more than some laughable fines.
Any reasonable person who resides outside the coddled ranks of these plutocrat-gangsters would have no trouble understanding Warren's anger. In fact, it's amazing that she is the way she is, because with her privileged background--Harvard law professor, Senator--she could easily stride right into Buffet's clubby world if she wanted to. But, no, she fights the fight for regular folks and fuck-yeah, she's angry and rightfully so.
Still, Buffet scolds her. He doesn't get it. He tells Warren in no uncertain terms that she should talk nice to these psychopathic sociopaths even though they are engaged in a non-stop frenzy of criminality and greed that is gutting nearly the entire human race. (And the planet.)
FUCK. YOU. BUFFET.
The hubris is unfathomable. I mean, seriously...I really cannot believe it. "Talk to us nicely?" Are you kidding me???
It reminds me of the scene from "A Few Good Men," where Jack Nicholson, who plays the deceitful, scheming Colonel Jessup, tells Tom Cruise's character, Danny, "You have to ask me nicely," when Danny asks for a document that Jessup lied about.
Here's the scene...
"You have to ask me nicely, Danny."
"You have to talk nice to us, Elizabeth."
The Buffet thing is not the end of story by any means, either. We recently heard that egotistical jerk, Jamie Dimon (who shall henceforth be known as, "Mr. 1-percent return") arrogantly attempt to "mansplain" Elizabeth Warren on how the banking system works.
For those of you who are unaware what mansplaining is, it's a condescending way that a man might speak to a woman, not necessarily meant to inform or educate, but to show how he is the smarter or, more superior person.
By the way, Warren put Dimon in his place.
I feel her anger. Believe me, I walk around pissed off all day long.
She's right to be angry. We gotta all get mad.
It's time to get mad.
I'll leave you with this classic clip from the movie, "Network."
President Obama wants the world to know that he takes it personally that the Democratic Party’s base opposes his latest effort to sell out the people of the world to the worst corporations through the infamous Trans-Pacific Partnership (TPP) deal. Obama blurted out at a press conference a number of conservative Republican memes as his sole basis for pushing TPP. He then launched personal attacks on Senator Elizabeth Warren and labor leaders (without naming them). Obama, who is famous for keeping his cool when criticized by the GOP, is thin-skinned when criticized by Democrats. Obama never raged at the Republicans’ “death panel” attacks on him, but he raged at Warren as supposedly making an equivalently openly dishonest attack on TPP’s secret drafting process.
One of the most reprehensible aspects of TPP is that it is (still) being drafted in secret – that it from us, the people – but with corporate lobbyists literally drafting their wish list. Obama made the critical mistake of personally attacking Warren, which is roughly equivalent to a small town mayor launching a personal attack on Jon Stewart. You know the results will be that Stewart will wipe the floor with the mayor....
Serious smackdown. Bill gives Barack a "black eye."
Obama is the one who infamously told the bankers he was protecting them from the American people’s demands for the restoration of the rule of law so that the banksters would be held accountable for leading the fraud epidemics that drove the financial crisis and the Great Depression. Obama, being Obama, phrased that in the form of a vile slander of the American people, claiming that they wanted to use “pitchforks” rather than prosecutions.
Ouch.
TPP is the opposite of “free trade.” In the jargon of its economic supporters, it is a moldering midden hiding the secretly drafted “rent seeking” provisions designed to help CEOs enrich themselves at the expense of the people of the world. Adam Smith, who supported freer trade, warned over two centuries ago that when CEOs meet secretly it promptly turns into a conspiracy against the public interest and warned that CEOs use their power to aid their own interests at the expense of shareholders and the public. Smith’s warned that it “ends in a conspiracy against the public, or in some contrivance to raise prices.”
TPP is the legal system designed to authorize plunder with impunity....
The roundhouse punch.
Obama did not simply allow lobbyists to largely draft TPP in secret – he classified their drafts – treating them as national security secrets. This would be downright funny if it were not so wicked....
Because "national security."
OMG, the religious right was right. Obama is Satan!
TPP is a deal that Obama, the failed economists, and the CEOs knew could not survive the light. They were aware of the truth of Justice Brandeis’ famous observation that “Sunlight is said to be the best of disinfectants.” TPP was drafted in secret to avoid that disinfectant. People who are doing straight up deals in the public interest would never allow lobbyists to draft the deal and would have welcomed criticisms of their drafts. The secret drafting of TPP largely by the CEOs’ lobbyists was designed to maximize the ability of CEOs to plunder...
Read the whole screed. It's Bill in all his awesomeness.
The actual purpose of his column, however, was to smear any member of Congress (and he singled out Senator Elizabeth Warren as his example) who opposes TPP as not simply economically ignorant, “failing” a “no brainer” exam, but also engaged in “mendacity.” Given that mendacity is Mankiw’s primary area of expertise – and that President Obama soon joined Mankiw in claiming that Warren was lying in her criticisms of TPP – I thought someone should respond to Mankiw
Smackdown follows.
Bill fails Mankiew in Economics 101. As a former philosophy prof. I give him and F in Ethics 101.
Mankiw: "“it would be irrational for savings and loans [CEOs] not to loot.”
The U. S. Senate seat now held by Elizabeth Warren is, of course, Ted Kennedy's old seat. But did you know that that seat was previously held by John Quincy Adams, Daniel Webster, Chales Sumner, Henry Cabot Lodge, Henry Cabot Lodge, Jr., and John F. Kennedy, among others? That is a brief history of America right there.
On December 11, 2014, the US House passed a bill repealing the Dodd-Frank requirement that risky derivatives be pushed into big-bank subsidiaries, leaving our deposits and pensions exposed to massive derivatives losses. The bill was vigorously challenged by Senator Elizabeth Warren; but the tide turned when Jamie Dimon, CEO of JPMorganChase, stepped into the ring. Perhaps what prompted his intervention was the unanticipated $40 drop in the price of oil. As financial blogger Michael Snyder points out, that drop could trigger a derivatives payout that could bankrupt the biggest banks. And if the G20’s new “bail-in” rules are formalized, depositors and pensioners could be on the hook.
The new bail-in rules were discussed in my last post here. They are edicts of the Financial Stability Board (FSB), an unelected body of central bankers and finance ministers headquartered in the Bank for International Settlements in Basel, Switzerland. Where did the FSB get these sweeping powers, and is its mandate legally enforceable?
Those questions were addressed in an article I wrote in June 2009, two months after the FSB was formed, titled “Big Brother in Basel: BIS Financial Stability Board Undermines National Sovereignty.” It linked the strange boot shape of the BIS to a line from Orwell’s 1984: “a boot stamping on a human face—forever.” The concerns raised there seem to be materializing, so I’m republishing the bulk of that article here. We need to be paying attention, lest the bail-in juggernaut steamroll over us unchallenged.
Using state capture to institutionalize capitalizing gains and socializing losses through the force of law.
When people talk about politicians that aren't friendly to Wall Street, they always bring up Senator Elizabeth Warren (D-MA).
They rarely remember a man who's quietly proposed more bipartisan Wall Street regulation than Warren — Ohio Senator Sherrod Brown (D).
Now is the time to remember him though, because if the Democrats keep control of the Senate Brown could end up heading the powerful Senate Banking Committee according to Guggenheim Securities analyst Jaret Seiberg
"If Democrats keep the Senate, Sen. Sherrod Brown may be the next chairman," Seiberg wrote in a recent note. "This is the senator who wants the biggest banks to maintain a 15% equity to assets ratio. Despite this, he also would help the regional banks, small banks and insurers and could favor raising the SIFI [Systemically Important Financial Institutions] threshold to $100 billion or more.
That 15% ratio is part of a bill Brown proposed along with Senator David Vitter (R-LA). It's called the "Terminating Bailouts for Taxpayer Fairness" Act and is meant to end 'Too Big To Fail.'…
The problem, he said, is not his book -- it's reality. "People should be afraid more of the realities than with my book. My book is not the problem. The problem is rising inequality, the fact that top wealth holders have been rising three times faster than the size of the economy," he said, referencing the upper echelons of the Forbes 500 list, which he noted have seen their wealth rise thrice as fast as the economy has grown. "If the FT has a different ranking, they should publish it, but apparently they don't have it so, you know, they should stop."
Piketty was joined in the interview by Massachusetts Democratic Senator Elizabeth Warren, who, HuffPost noted, has herself been the subject of rather pointed attacks from the financial industry. Asked how she would suggest Piketty respond to the critique, she had just two words of advice: "Hit back."
A discussion between Sen. Elizabeth Warren (D-MA) and economist Thomas Piketty regarding income inequality and how to combat it will air Monday night at 8:30 p.m. EST. “It’s fundamentally this question about whether or not the game is rigged,”…
Sen. Elizabeth Warren (D-Mass.) will appear at an event later this month in Boston with French economist Thomas Piketty, bringing together the authors of two books on economic inequality that have both vaulted to the top of the Amazon and New York Times best-seller lists. The conversation between Warren and Piketty, to be aired on HuffPost Live, will take place at Boston's Old South Meeting House on May 31....
The Old South Meeting House, where the event will be held, is known as the birthplace of the American Revolution, from where the (actual, historical) tea party was launched.
The conversation will begin at 10:00 a.m. and will be moderated by this reporter. It is open to the public on a first-come, first-served basis. To submit a question for Warren and/or Piketty, email ryan-at-huffingtonpost.com or tweet @ryangrim.
The event is being sponsored by Patriotic Millionaires, a group of high-net-worth people advocating for higher taxes on themselves. Piketty proposes drastically hiking taxes on the rich as one of the means of reducing inequality.
The feud between Third Way and Sen. Elizabeth Warren (D-Mass.) has surfaced in a way the corporate-backed think tank probably didn't intend.
After Warren sent a fundraising email on behalf of Sen. Mark Pryor (D-Ark.), the campaign of Rep. Tom Cotton (R-Ark.), his opponent in the Senate race, noted that Third Way co-founder Matt Bennett had called Warren's economic message "catastrophically antibusiness" at the 2012 Democratic National Convention.
The No. 2 author on Amazon's best-seller list, Sen. Elizabeth Warren, weighed in Thursday night on the No. 1 book, identifying overlapping themes.
At a reading at the Harvard Book Store, the Massachusetts Democrat, author of A Fighting Chance, was asked about Thomas Piketty's new book, Capital in the Twenty-First Century, and specifically about its contention that trickle-down economics "definitively do not work."Warren cut in. "Can we say that part again? 'Definitely do not work,'" she repeated. "Not as in that's somebody else's opinion or this comes out of a long-held political opinion. The data don't lie on this. He's got good historical data, and boy, what it shows is trickle down doesn't work. Never did, doesn't work. Just so we're all clear on the baseline. I just saved you 1,100 pages of reading." (The book is shorter than that; Warren may have assumed the audience would also read the online technical index.)
Warren, whose own book was going to be titled Rigged but ultimately went out with a more hopeful title, said that while Piketty's book could elicit despair, she found a hopeful note in it, too.
"You can read his book and you just wanna say, 'Ugh.' Because it says over and over -- look, I'll tell you the basic theme: The rich get richer," Warren said.
As far as neoliberals are concerned, the the rich getting richer is what capitalism is all about, and distribution is beside the point. "A rising tide lifts all boats."
This is shaping up as the major theme in the 2016 general election, and Elizabeth Warren has Pope Francis in her corner.
"Here's the hopeful part in Piketty's book: Piketty makes the point that although the data keep documenting this happening, it's not like an act of nature. It's not like gravity and you can't fix it," Warren said. "Piketty's book makes the point that how much equality there is ... is a matter of the policies you choose to follow and that, for example, progressive taxation and investment in everyone's education helps to level the playing field...."
"It is a time when we made those investments that built America's great middle class and we made those decisions -- not we in this room, but our parents, our grandparents, they made those decisions. They said, 'You put a cop on the beat so nobody steals your pension, you do that on Wall Street.' But they also said, 'You tax progressively and then you make those investments.' For those who made it big, God bless 'em, that's great, but they've gotta pay a piece of that forward so the next kid has a chance to make it big and the kid after that and the kid after that. That's what defines America."
