But what it does not show is debt, because if that debt were to be repaid money would have to be created to pay it. And money is of course just debt. So, in effect, it is unrepayable except by taxing it out of existence. I doubt anyone is suggesting that.
Sure, I think a period of budget surpluses which then both destroy money and pay down the national debt would be a fine idea. As did Keynes himself of course – sunshine and times to mend roofs etc.
Hang on Tim
You’re querying the credentials of a man that can, without irony put this out there.
I have known of a coming ecological crisis since the 70s when I first read E J Mishan’s ‘The cost of economic growth’, Schumacher’s ‘Small is beautiful’ and much more. I have been environmentally aware for more than five decades now.
I have called for a Green New Deal. It is possible.
And the powers that be have ignored it all.
At 65 I will make it through this crisis. Billions won’t.
Do we really not care?
Not much I can add to that really – he’s either the most acute satire ever or utterly unhinged.
It seems that New Labour followed the Tories for the first few years when the sun was shinning but then forgot about the roof and spunked money on their pet projects.
And ‘eco awareness’ was sparked in large part by Rachel Carsons nonsense about DDT in ‘Silent Spring’. The left have been milking the gravy train (to mix metaphors) and using it to further their socialist agenda ever since.
Patrick Moore of Greenpiss saw through it years ago and has been un-personed by the organsisation he helped found.
I suspect Carson has killed more people than Stalin managed. But they’re only poor brown and black people so the ecomentalists don’t care about them.
Surely anyone having written this and then read it back to themselves would have at least the teensiest tinsiest suspicion that something, somewhere is horribly wrong. No?
“But what it does not show is debt, because if that debt were to be repaid money would have to be created to pay it. And money is of course just debt. So, in effect, it is unrepayable ”
Can you even imagine saying this out loud to somebody, would you then lend them a tenner?
I have known of a coming ecological crisis since the 70s when I first read E J Mishan’s ‘The cost of economic growth’, Schumacher’s ‘Small is beautiful’ and much more. I have been environmentally aware for more than five decades now.
Was this acute ecological awareness that lead him to the profession of accountancy instead of, say, an organic farmer or some sort of environmental scientist?
Being aware of a problem at age 15 and doing nothing about it for 50 years really isn’t something to boast about.
I have known of a coming ecological crisis since the 70s when I first read E J Mishan’s ‘The cost of economic growth’, Schumacher’s ‘Small is beautiful’ and much more. I have been environmentally aware for more than five decades now.
I have called for a Green New Deal. It is possible.
And the powers that be have ignored it all.
At 65 I will make it through this crisis. Billions won’t.
Do we really not care?
This really is moving into William McGonagall territory. Has anyone noticed if he’s started referring to himself as “Richard Murphy, Knight of the White Elephant, Burmah”?
“Sure, I think a period of budget surpluses which then both destroy money and pay down the national debt would be a fine idea.”
The government’s fiscal balance is endogenously-determined. Bill Mitchell explains in one of his weekly quizzes.
[quote]
Question 1:
A currency-issuing government does not control the fiscal outcome.
The answer is True.
The non-government sector spending decisions ultimately determine the fiscal balance associated with any discretionary fiscal policy.
The fiscal balance has two conceptual components. First, the part that is associated with the chosen (discretionary) fiscal stance of the government independent of cyclical factors. So this component is chosen by the government.
Second, the cyclical component which refer to the automatic stabilisers that operate in a counter-cyclical fashion. When economic growth is strong, tax revenue improves given it is typically tied to income generation in some way. Further, most governments provide transfer payment relief to workers (unemployment benefits) and this decreases during growth.
In times of economic decline, the automatic stabilisers work in the opposite direction and push the fiscal balance towards deficit, into deficit, or into a larger deficit. These automatic movements in aggregate demand play an important counter-cyclical attenuating role. So when GDP is declining due to falling aggregate demand, the automatic stabilisers work to add demand (falling taxes and rising welfare payments).
When GDP growth is rising, the automatic stabilisers start to pull demand back as the economy adjusts (rising taxes and falling welfare payments).
The cyclical component is not insignificant and if the swings in private spending are significant then there will be significant swings in the fiscal balance.
The importance of this component is that the government cannot reliably target a particular deficit outcome with any certainty. This is why adherence to fiscal rules are fraught and normally lead to pro-cyclical fiscal policy which is usually undesirable, especially when the economy is in recession.
The fiscal outcome is thus considered to be endogenous – that is, it is determined by private spending (saving) decisions.
The government can set its discretionary net spending at some target to target a particular fiscal deficit outcome but it cannot control private spending fluctuations which will ultimately determine the final actual fiscal balance.
[end quote]