tag:blogger.com,1999:blog-2098432983500045934.post2295798348661628151..comments2024-03-12T22:19:32.339-04:00Comments on The New Arthurian Economics: A fetish for decline (part one)The Arthurianhttp://www.blogger.com/profile/16501331051089400601noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-2098432983500045934.post-86388283100738479002011-09-15T22:38:14.923-04:002011-09-15T22:38:14.923-04:00I wonder how much of our problems are founded in t...I wonder how much of our problems are founded in the limitations of the field of economics. Economics is far more vague then the economists would like. When things go wrong with the capitalist model, we look for logical causes but use the wrong tools and methodologies, so how can we correct what ills it?<br /><br />The quantity of labor is too high, especially with minimum wage, unemployment insurance, and other burdens associated with hiring people. In a supposedly endless population growth, we constantly need to put people to work and periodic retraining on a massive scale is vital. Labor resources need to redeploy.<br /><br />If the deregulation mantra were true, we'd see a lot more business activity rather than accentuating the peaks and valleys like Kondratieff said it would every 70 years or so. Trying to sustain a business cycle may be impossible, especially if Greenspan's (perhaps BOB deserves the addition of a "G") free money created artificial, and unsustainable, demand.<br /><br />Peak oil and the scarcity of resources crimps demand and growth. We now consume 70% of our oil from abroad. Toss in our insatiable appetite for imports and you have a massive outgoing cash flow.<br /><br />Then there's too much G, making Keynesianism only work if it's of a scale beyond our comprehension. Then the debt will be un-repayable (sshhh--it is already.)<br /><br />I think the Fed like the unemployment, what George Ure calls "the deflation monster." (Sept. 14th post)<br /><br />David Rosenberg is calling this a "modern-day depression" as opposed to a traditional one. See him in the Financial Post article <a href="http://business.financialpost.com/2011/09/14/7-reasons-america-is-in-a-modern-day-depression-rosenberg/" rel="nofollow">here</a>.<br /><br />I like staying on this theme that:<br /><br />1) policymakers are fighting the last economic crisis, using the same tools that worked last time to address this challenge (just like we fight this war just like the last war)<br /><br />2) population trends will reduce economic growth in the developed world<br /><br />3) US manufacturing has been gutted due to unfair globalization, destroying middle class jobs<br /><br />At some point those who know why the system has failed have a moral obligation to let people know they need to mobilize themselves poltiically. This is real Marxism, as he knew economic realities paint political priorities. In his view, it's the owners at the top of the capitalist economic pyramid who use political power to enrich the owners of the means of production.jbpeebleshttps://www.blogger.com/profile/11386620564536871255noreply@blogger.comtag:blogger.com,1999:blog-2098432983500045934.post-77624099400888230972011-09-14T13:12:15.182-04:002011-09-14T13:12:15.182-04:00I agree with most of your quibbles, but I also rec...I agree with most of your quibbles, but I also recognize a great deal of underlying truth in the excerpts.<br /><br />I think this dovetails rather nicely with <a href="http://jazzbumpa.blogspot.com/2011/09/high-finance-sector-profits-kill.html" rel="nofollow">my post yesterday.</a><br /><br /><i>I agree: tax rate changes and fiscal stimulus are distractions. Pawns. Inconsequential, ineffective tools. I agree.</i><br /><br />Really? Why? Tax rate changes profoundly affect the distribution of wealth in a society. Fiscal Stimulus has been proven to be effective, both in the 30's and again most recently with the Obama stimulus - Rethug lies of ineffectiveness are the distraction.<br /><br /><i>Huh. I am also "light on blaming the rich".</i><br /><br />Again, why? The stagnation of the economy and increasing wealth disparity are closely correlated - historically, and again now.<br /><br />Forced redistribution downward, using tax policy, regulation, and strong collective bargaining gave us the golden age. Abandoning all those things gave us the great stagnation. Looks pretty straight-forward to me.<br /><br />Cheers!<br />JzBJazzbumpahttps://www.blogger.com/profile/07337490817307473659noreply@blogger.com