As I\’ve been saying for some time now

Ed Miliband has urged his party to remember that the post-war Labour government achieved radical social change while also managing to run budget surpluses in a time of austerity.

The Labour leader urged party members concerned about his decision to accept coalition spending plans for 2015-16 to recognise that high day-to-day spending is not the only route to social justice and that Clement Attlee created the welfare state and NHS while also balancing the budget.

Of course, they created the NHS simply by nationalising all of the extant health care facilities.

But it is true that Major Atlee was running budget surpluses, yes.

10 thoughts on “As I\’ve been saying for some time now”

  1. The explanation for those post WWII surpluses is intuitively obvious to advocates of Modern Monetary Theory, and one cannot conclude from those surpluses that a surplus is in order now.

    The private sector has a PRFERRED level or stock of what MMTers call “private sector net financial assets” – that’s national debt and monetary base. If that level is exceptionally high, as it tends to be after a war, the private sector will tend to want to dispose of that “debt plus base”, and that disposal equals a government surplus.

    Same thing happened after the Napoleonic wars.

    Incidentally, MMT is so close to Keynes that it’s debatable as to whether MMT constitutes a different set of ideas. I.e. I would expect Keynsians to go along with my above points about surpluses.

  2. MMT says that only gov’t spending AND TAXES drive growth because, you know, money is now only really exchangeable for your taxes which are just you paying the state back for all those lovely things it has already done for you and the moon really is made of fucking cheese. Keynes never said any of this dogshit; do we really have to bother with it?

  3. Ironman,

    Dean Baker, director of the Centre for Economic Policy and Research in the US said that there is next to no difference between MMT and Keynes. I suspect he knows a teensy bit more about it than you, as you use of words like “dogshit” and “fucking cheeze” amply demonstrate.

  4. Always the same; invoke a name, invoke a title, play the “he knows more than you” card. This is a false argument invariably used in support of a false doctrine. For good measure: Richard Murphy, chartered accounatnt, economist,tax expert and MMTer
    Look, countless extremely qualified economists, possibly even more qualified than you, have debated economics for centuries and most have been wrong about very many things.
    Regarding MMT itself: it simply cannot be the same as Keynesian theory if it says different things. Its views of deiecits run counter to Keynes’ counter-cyclical analysis, its understanding of the very nature of money, its accountant’s view of the private sector (the economy as some of us call it).
    MMT is pseudo analysis cooked up by marxists in another lame attempt to justify the Courageous State. From Lenin, through Mao, Pol Pot and on to Castro, all you bring is poverty, hunger and misery.
    I do apologise for “Dogshit”, it just doesn’t get near to describing MMT adequately does it.

  5. So Much For Subtlety

    Ironman – “MMT is pseudo analysis cooked up by marxists in another lame attempt to justify the Courageous State. From Lenin, through Mao, Pol Pot and on to Castro, all you bring is poverty, hunger and misery.”

    You are way to kind to this form of lunacy. To quote from Wikipedia:

    Therefore, budget deficits, by definition, are equivalent to adding net financial assets to the private sector; whereas budget surpluses remove financial assets from the private sector. This is represented by the identity: (G-T) = (S-I) – NX (where G is government spending, T is taxes, S is savings, I is investment and NX is net exports). It is important to note that this identity is not unique to Modern Monetary Theory; it is an identity used throughout all macroeconomic theories, because it is true by definition.
    The conclusion that MMT necessarily draws from this is that private net saving is only possible if the government runs budget deficits; alternately, the private sector is forced to dis-save when the government runs a budget surplus.

    By this logic Zimbabwe must have one of the largest banking sectors in the world. A financial giant. Given, you know, the government is running up such impressive deficits.

  6. IanB

    No, I certainly didn’t Keynes is dogdhit. But these days we have cretins running around who THINK they’re Keynesians and we have the MMTers, who have dogshit for brains.

  7. “Just to add the obvious: Keynes is also dogshit.”
    Oh, can’t we just say most economists are dogshit & leave it at that. That economies are ?m?a?n?a?g?e?d? fucked around, up & over by economists is proof positive of that. After diversity advisers, possibly the world’s most useless career choice.

  8. Well, if they’re going to fill their time by making entries in wikipedia like the dogshit SMFS highlighted then yes. I read that entry to the bitter end as well. I also followed links from Ritchie’s blog of all things. God it is painful; the real world doesn’t interfere in their logic at all.

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