Monthly Archives: January 2014

The Eurozone’s “Nascent” Recovery

By William K. Black

On January 19, 2014 I posted a column entitled “Deflation: The Failed Macroeconomic Paradigm Plumbs New Depths of Self-Parody” that discussed the insanity of the Eurozone’s approach to “the threat of deflation.”  The EU’s troika cannot understand that deflation is produced by inadequate demand and that the way to prevent it is to use fiscal policy to fill the gap in demand rather than waiting for deflation to hit and then trying to check it through “quantitative easing (QE).”

My January 25, 2014 column (“Spain Rains on Rehn’s Austerity Victory Parade: Unemployment Rises to 26%”) explained how a few weeks after the troika cited Spain as its success story proving the wisdom of austerity, unemployment in Spain – already above Great Depression levels – increased to 26%.

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Does the Debt Ceiling Have to Be Raised?

By Joe Firestone

Lately, the word out of Washington, DC from the plugged in people is that there will be no debt ceiling crisis coming up before the election. Politico says so, and so does the National Journal. MSNBC also agrees.
But not so fast, says the Washington Post, echoing the Wall Street Journal provided the House Republicans can agree on “. . . an extortion demand.” If they can, then we wll have another debt ceiling crisis.

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The Powerful “Black Effect” v. Peltzman’s Hyped Effect

By William K. Black

My title extends the humorous theme of I found in an article by Dr. David S. Pisetsky’s (M.D., Ph. D).  Pisetsky’s riff is that he was eager to become famous by announcing “Pisetsky’s Rules” about rheumatology treatment risks and discovered to his great disappointment that Sam Peltzman had got their first and the risk phenomenon Pisetsky wished to warn about was already known as the “Peltzman effect.”  

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What’s the Politically Correct Word for Schiffhead?

Click image to view video

The Economist Treats Milton Friedman as Jesus: Asks His Disciples to Preach His Gospel

By William K. Black

I was peacefully researching a book I am co-authoring with Wesley Marshall on the pathologies of theoclassical and neoclassical economics as exemplified by “Nobel” laureates in economics (the economics prize is actually a creature of the Swedish Central Bank), when I read a column in the Economist about financial regulation and the crisis that provided an exemplar of how much is wrong about modern economics.  The May 1, 2009 column is entitled “WWMFD” (What Would Milton Friedman Do?).

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We are all Keynesians Now – Chris Matthews Recants

By William K. Black

On January 28, 2014, Chris Matthews told a guest on “Hardball” that his sources were telling him that the Obama administration was convinced that the U.S. economy needed additional stimulus.  Matthews told his guest:  “I’m a Keynesian; you’re a Keynesian.”  They talked about the difficulties of getting Congress to provide the necessary increase in stimulus.

On November 12, 2012, I wrote a column about Chris Matthews statements on his November 9 program about Matthews’ denouncing Paul Krugman because Krugman was (like us at UMKC) calling on the administration not to adopt an austerity policy in the form of the “Grand Bargain,” which is really the Grand Betrayal of the safety net.  Here is the key passage from my column.

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The AEI Takes its Regulatory Advice from Alan Greenspan

By William K. Black
(Cross posted at

Mark J. Perry and Robert Dell’s February 24, 2011 article (“More Equity, Less Government: Rethinking Bank Regulation”) claims that the government caused the crisis and that the solution is to increase capital requirements and reduce government regulation.  The authors are at an ultra-conservative “think” tank (AEI) dedicated to protecting elite CEOs from the “regulatory cops on the beat.”

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Inequality Revisited: The Rise of the Individual is Always at the Expense of Community

By June Carbone

The debate over inequality has shifted.    It is no longer whether greater inequality exists (it indisputably does) or whether it is a good thing (even David Brooks and Marco Rubio concede that it is not).  Instead, the big issue is whether the rise of the top one tenth of one percent with their extraordinary concentration of wealth has anything to do with the rise of inequality between the middle and the bottom.    The answer is, of course it does, in ways that are both simple and complex.  Let us begin to count the ways . . . .

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Warren Mosler’s talk in Chianciano, Italy, January 11, 2014

By Alexandria J E Angus

Warren Mosler gave this talk in Chianciano, Italy, on January 11, 2014 at the Chianciano Conference entitled Oltre L’Euro: La Sinistra. La Crisi. L’Alternativa. In English: Beyond The Euro: The Left. The Crisis. The Alternative [Google translation]. The video is embedded below, but you have to listen to a realtime translation in Italian, which doubles the listening time. I thought this talk important enough to transcribe, if not deliciously subversive on the part of Warren Mosler who offers Italians a way to save their economy. The transcription follows below the video.

Mosler describes how Italy (or any of the 17 EU countries that use the Euro) can leave the European Union safely if the EU persists, as it insists on doing, in impoverishing their country and citizens.

The subheads in blue are mine, not Mosler’s, and are designed to assist reading. Some terms Mosler refers to in the body text relate specifically to the Italian economy, and I can’t identify them because I don’t know their Italian names.


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Who Should Be Invited to the State of the Union?

NEP’s William Black provides his view on this topic in the New York Time’s Room For Debate section. You can view his post here.