Author Archives: Devin Smith

Degrees of Responsibility for Climate Catastrophe

Posted on February 27, 2014 | 16 comments

By Michael Hoexter

The climate crisis is an event with such profound personal and broadly social moral implications that many shy away from discussing the crisis itself let alone its ethical aspects.  Via our society’s use of fossil fuels we are, if our combustion of these fuels remains unchecked and in addition we further destroy the carbon fixing capacity of natural systems, destroying almost all wealth, the likelihood of their being future civilizations, and even the possibility for existence for future generations.  To continue ignoring climate change and effective climate action is definitely an après moi le deluge stance, an expression of callousness and self-absorption unsupportable by moral justification.  Morality and ethics is here not an exotic preoccupation of a select group but a basic reality-check:  does what we are doing make sense and promote the general ends to which these activities are devoted?  How do we assess our own agency and role and those of others, in events that are occurring around us and will with very high likelihood exacerbate in the future?

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MMT AND EXTERNAL CONSTRAINTS

Posted on February 24, 2014 | 25 comments

By L. Randall Wray

To Fix or To Float, that is the question.

MMT argues that a sovereign government that issues its own “nonconvertible” currency cannot become insolvent in terms of its own currency. It cannot be forced into involuntary default on its obligations denominated in its own currency. It can “afford” to buy anything for sale that is priced in its own currency. It might be able to buy things for sale in foreign currency by offering up its own currency in exchange—but that is not certain.

If, instead, it promises to convert its currency at a fixed price to something else (gold, foreign currency) then it might not be able to keep that promise. Insolvency and involuntary default become possible.

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If New York Times Reporters Won’t Read Krugman about Austerity Will they Read Brooks?

Posted on February 22, 2014 | 4 comments

By William K. Black
(Cross posted at Benzinga.com)

The New York Times Incompetence in Macroeconomic Reporting (IMR) Award

I have written repeatedly about the New York Times’ needs to create a prize in incompetence in macroeconomic reporting (IMR) and suggested that the paper award the IMR prize to its reporters.  I suggested that the prize consist of a two hour lunch with Paul Krugman in which he will provide them with a remedial lecture on why austerity is an economically illiterate response to a recession.

NYT columns discussing austerity, particularly in the eurozone, demonstrate that its reporters religiously avoid reading Krugman’s scores of columns on austerity.  As always on this subject, I want to make express that I don’t insist that the reporters agree with economics.  It is fine for reporters to state that economics has known for 75 years that austerity is a self-destructive response to a recession but that some economists disagree.   It is fine for the reporter to explain why he agrees with the austerian economists.  It is not acceptable journalism to ignore the dominant economic view, 75 years of supporting events, and the empirical studies by austerians (the IMF) finding that fiscal changes have more powerful effects on the economy consistent with the dominant theory.  It is not acceptable journalism to ignore unemployment and inequality and the role of austerity in increasing both.  I end by expanding on Krugman’s column about a tragic financial media meme by discussing three related memes that are causing great harm.

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Correcting the Poor: The Civilizing Impulses of Homo Corporatus and Private Charities

Posted on February 20, 2014 | 14 comments

By Falguni A. Sheth
Crossposted at Translation Exercises

Should anyone—the state or any other source–have an obligation to interfere with you to bring your best, flourishing, self about?

Certainly, this is the debate that philosophers such as Isaiah Berlin and libertarians such as Robert Nozick have engaged in heartily, with a view to socialist frameworks that redistribute resources in order to produce selected kinds of outcomes. Should the state impose certain ideals and goals upon you, and why? There are also numerous examples of good state-imposed expectations such as seatbelts or prohibitions against drunk driving, as well as terrible examples, such as state-imposed prohibitions on certain kinds of drugs.

In a neoliberal era, the corollary to above question is whether non-state organizations should have the ability to interfere with you in order to bring your best, flourishing, self about?

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Essays in Monetary Theory and Policy: On the Nature of Money (10)

Posted on February 13, 2014 | 19 comments

By A. Clayton Slawson III*

In today’s economic market, people tend to think excessively about money whether to spend on essential or discretionary goods and services, savings or which investment options to choose, or even the current topic du hour in Washington, whether there is too much or too little money floating around! Many “arm chair” economists, lacking the knowledge of our economic history, stop at these basic thoughts however, and thus never fully understand money in terms of its identity, origin, or even how today’s currencies became of value in the first place. Just as these concerns can vary person to person, so too can the very definition of money and how currency adopts value. In order to better understand the “nature of money,” this paper will utilize the frameworks of both the Orthodox school and the Heterodox schools of thought to provide a basic understanding of money in their respective approaches, which will set up a clear argument for why one approach is more advantageous for guiding economies toward full employment. Undoubtedly, any weekend warrior economists will be better prepared for discussions on money at the conclusion of this paper.

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Spain, Italy, and France: Economic Failures that Will Soon be Political Failures

Posted on February 13, 2014 | 16 comments

By William K. Black

The troika has consigned one-third of the Eurozone to a gratuitous Great Depression

I have written several articles recently describing Spain’s continuing Great Depression levels of unemployment and the absurdity of the troika’s policies with regard to the “threat” presented by “deflation.”  The troika consists of the European Commission, the European Central Bank (ECB), and the International Monetary Fund (IMF).

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Consumer Activism and the Biopolitics of Consumption

Posted on February 13, 2014 | 8 comments

By Falguni A. Sheth
This post was originally posted Translation Exercises on Feb. 12, 2014

Last month, I wrote an article about former financier Sam Polk, whose move from Wall Street to Groceryships has been celebrated as an example of the 1% awakening to a moral conscience.  Groceryships is a charity that gives “grocery scholarships” to “poor moms” in order, ostensibly, to alleviate their meager budgets for healthy foods. But the scholarships come with many strings attached: to swear an allegiance to want to be healthy; commitments to attend weekly nutrition classes, do homework, take cooking classes. More on Groceryships in my next piece.

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Edwin Sutherland: The 75th Anniversary of His Coining The Term White-Collar Crime

Posted on February 10, 2014 | 1 comment

By William K. Black
(Cross posted at Benzinga.com)

Introduction

This year is the 75th anniversary of Edwin Sutherland’s presidential address to the annual meeting of the American Sociological Association in 1939.  In the course of beginning to write a book from a white-collar criminological perspective about our modern financial crises I decided to reread Sutherland’s address (which was published as an article in 1940) to see how it stands up in light of modern white-collar criminological research and theory.  It reads exceptionally well today.  It is not even archaic in tone.  Sutherland begins by listing eleven (there were two van Sweringen brothers involved in their scam) examples of the kind of criminals he was referring to.

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The Debt Crisis in Puerto Rico: Why Is It Not More Newsworthy?

Posted on February 9, 2014 | 8 comments

By Robert E. Prasch

Anyone who follows the news periodically, if not more often, wonders about the criteria making certain issues or persons “newsworthy,” and others substantially less so. One reliable indicator of newsworthiness is that the story happens in Washington, D.C. A second is an unusual or counter-intuitive event (“Man bites dog”). A third is the prospect of large losses. This last quality, however, renders the relative neglect of Puerto Rico’s debt crisis an interesting anomaly.

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The Troika and the New York Times Bury the Issues, not just the Lead

Posted on February 7, 2014 | 7 comments

By William K. Black

On February 6, 2014, Mario Draghi, the head of the ECB said a series of contradictory things each of which indicated a failure to understand economics – and the BBC article about his policies failed to point out or analyze this failure.  Draghi’s primary message, in response to news that “Eurozone inflation slowed to 0.7% in January from 0.8% in December” was:

“We have to dispense with this idea of deflation. The question is – is there deflation? The answer is no.

We have to treat the recovery with extreme caution. It is very fragile. It is starting from very low levels but it is proceeding.”

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