Posted below, with kind permission of the author, is the transcript (see note below) of James K. Galbraith’s keynote lecture to the 5th annual “Dijon” conference on Post Keynesian economics, meeting at Roskilde University near Copenhagen, Denmark on May 13, 2011. Please see the source link at UTIP for the
If the road to hell is paved with good intentions, then the road political progressives are on may be very well paved, but it’s still heading in the wrong direction. Prof. Stephanie Kelton explains why in her response to CPC Co-Chair Representative Keith Ellison: Maddening! The Clinton surpluses were driven
James K. Galbraith: Without the rule of law, the financial sector is no use to anyone except those who own it and the politicians they own
Posted below, with kind permission of the author, is the transcript (see note below) of James K. Galbraith’s talk on financial fraud at the 20th annual Levy Institute Hyman Minsky conference at the Ford Foundation in New York City on April 15, 2011. ************ ************ ************ In the past month I’ve attended
[x-posted with permission from New Economic Perspectives — selise] Worse than Hoover By Marshall Auerback It’s actually a bit over the top and unfair to compare Barack Obama with Herbert Hoover – unfair that is, to the memory of Herbert Hoover. The received image of the latter is the dour,
Please see update below. — selise ************ ************ ************ The Honorable James P. McGovern 438 Cannon House Office Building United States House of Representatives Washington, DC 20515 Dear Representative McGovern, My name is xxxx xxxx. I am writing to ask you to take a leadership role in resolving the unnecessary federal budget
The following is x-posted from The Center of the Universe, with the kind permission of the author. Please see note below. — selise ************ ************ ************ By WARREN MOSLER MMT to President Obama and Members of Congress: Deficit Reduction Takes Away Our Savings SO PLEASE DON’T TAKE AWAY OUR SAVINGS! Yes, it’s
The following two-part series is x-posted from New Economic Perspectives, with the kind permission of the author. — selise UPDATE: At the Peterson Foundation Fiscal Summit, no one challenged the underlying premise: that to be Fiscally Responsible, we have to be concerned about balancing the Federal Government Budget. But that
A bipartisan gathering of deficit terrorists and deficit errorists is convening in D.C. today to discuss how best to continue trashing of American’s middle class, and the economy generally (h/t PrestoVivace). Livestream is available, although I strongly recommend a quick vaccination against the bat-shit-crazy before viewing.
From the Peter G. Peterson Foundation website: Nation’s Lawmakers, Policy Experts and Thought Leaders to Come Together in Washington on May 25 to Discuss Bipartisan Solutions to America’s Long-Term Debt and Deficits:
On Wednesday, May 25, 2011, senior Administration officials, policy experts and Democratic and Republican elected leaders will come together in Washington to discuss solutions to the nation’s fiscal challenges at the 2011 Fiscal Summit: Solutions for America’s Future, convened by the Peter G. Peterson Foundation. As the nation confronts critical choices about how to address our long-term debt and deficits, the Foundation’s second annual Summit will bring together hundreds of stakeholders from across the ideological spectrum to discuss proposals to be presented by leading policy organizations and explore concrete, bipartisan solutions.
Participants include keynote speaker President Bill Clinton; Members of the Congress working on fiscal issues including Senators Saxby Chambliss (R-GA), Kent Conrad (D-N.D.), Mike Crapo (R-ID), Dick Durbin (D-IL), and Mark Warner (D-VA) and Congressman Paul Ryan (R-WI); National Economic Council Director Gene Sperling; Governor Mitch Daniels, Co-Chair of the National Commission on Fiscal Responsibility and Reform Alan Simpson, and Foundation Chairman Pete Peterson and Vice Chairman Michael Peterson.
At last year’s Summit, participants agreed on the need to take action on the nation’s long-term debt and deficits. With increased consensus that our country’s fiscal situation is unsustainable, this year’s Summit will bring together stakeholders from across the political spectrum to discuss a range of concrete, comprehensive solutions.
The American Enterprise Institute, Bipartisan Policy Center, Center for American Progress, Economic Policy Institute, Heritage Foundation and Roosevelt Institute Campus Network will present and discuss their own proposed packages of solutions for achieving long-term fiscal sustainability at the Summit. These leading policy organizations, representing diverse perspectives, received grants from the Peter G. Peterson Foundation to develop comprehensive plans to address the nation’s projected long-term debt and deficits.
If any sane voices are to be heard, the only group I hold out any hope for is the Roosevelt Institute Campus Network. Will anyone do what is actually needed and challenge the underlying premise? All it would take is for some brave soul to ask the question, “Is The Federal Debt Unsustainable?” as James K. Galbraith did in his May 5, 2011 Policy Note at the Levy Economics Institute (pdf). Here are a few bits to assist in watching the Peterson freak show:
By general agreement, the federal budget is on an “unsustainable path.” Try typing the phrase into Google News. When I did it, 19 of the first 20 hits referred to the federal debt.
But what does this mean? The phrase is often stated, but rarely defined clearly. One is led to suspect that some who use the phrase are guided by vague fears, or even that they do not quite know what to be afraid of. After a brief discussion of the major worries, this note will attempt to clarify one, and only one, critical issue: the actual behavior of the public-debt-to-GDP ratio under differing economic assumptions through time.
Some people fear that there may come a moment when the government’s bond markets would close, forcing a default or “bankruptcy.” But this betrays nonunderstanding of both public finances and debt markets. The government controls the legal-tender currency in which its bonds are issued and can always pay its bills with cash. Apart (possibly) from the self-imposed politics of debt ceilings, a US government default on dollar bonds is impossible, and the word “bankruptcy”—which is a court proceeding to protect privatedebtors from their creditors—also does not apply.
Conclusion: It’s the Interest Rate, Stupid
The first way to approach it is to break the system, to try to move from a high to a low fixed cost environment. The way you do that, of course, is by destroying the institutions that support the system: government, the social welfare system, the infrastructure. The way you do that is by cutting its budget.
It seems to us that it is obvious that there is a very powerful movement, perhaps of overwhelming power going on right now, to do precisely that in every advanced country that you can think of, in the UK, in the United States, in Europe.
Is it going to be our argument that this is entirely based upon an ideological predilection or stupidity? It seems to me, that is not necessarily adequate. One has to understand, perhaps, that this is one approach which would preserve, at least, the predatory profitability of certain parts of the private system.
James K. Galbraith: In Defense of Deficits
… a big deficit-reduction program would destroy the economy, or what remains of it, two years into the Great Crisis.
For this reason, the deficit phobia of Wall Street, the press, some economists and practically all politicians is one of the deepest dangers that we face. It’s not just the old and the sick who are threatened; we all are.