Neil Irwin at Wonkblog has a new post up: The Deficit is Falling Fast. Can Washington Accept Victory?
He quotes John Makin of the American Enterprise Institute, who says, approvingly, that the U.S. has probably imposed enough austerity “for now.” Then he shows us the evidence. Continue reading
In yesterday’s NY Times, Nobel winner Robert Solow tackled the US debt debate, proclaiming that while it is a serious issue, many Americans are not aware of the facts.
Solow is a “neoclassical synthesis” Keynesian, the type of Keynesian economics that used to be taught in the textbooks. He was also on the wrong side of the “Cambridge controversy,” as the main developer of neoclassical growth theory. Still, he’s often on the “right side” when it comes to macro policy questions. And at least part of what he says about the US national debt is on the right track. But he gets enough confused that it is worthwhile to correct the errors.
Brad DeLong is worried. And now I’m worried. He’s worried about “unfunded tax cuts,” which, he says, are “bad juju” in the long run. I don’t mean to pooh-pooh his juju, but what the heck is an “unfunded tax cut”?
By Stephanie Kelton
Our friend Lambert Strether is having a fundraiser and we at NEP want to support him the way he supported us more than three years ago. We hadn’t met before, but Lambert wrote to ask if we would come to Washington, DC as an antidote to the “fiscal sustainability teach-in” that Peter G. Peterson was hosting. We agreed, and Lambert set about raising money and interest in the event. Warren Mosler, Bill Mitchell, Randy Wray, Pavlina Tcherneva and I all participated.
Correntwire was also one of the very few places where the Proof Platinum Coin concept took root and sprouted. He’s a tireless advocate who deserves our thanks.
If you support MMT, then please consider helping out someone who has done so much to help us over the years. Click here to help.
Posted in Uncategorized
The US is broke. Government deficits are de facto evidence of a government gone wild. We’re careening toward Greece. Entitlements are the root cause of our fiscal woes, and the Chinese are coming for our grandchildren. How many Americans believe this garbage? My guess? Most of them.
By Marriner S. Eccles
(via e-mail from Thorvald Grung, Central Bank of Norway)
Marriner Eccles was Chairman of the Federal Reserve under President Franklin D. Roosevelt. This note consists of excerpts from an address he gave to the US Senate’s Committee on Finance in 1933 before he was called to Washington for public service by FDR. The original address contained in the Congressional Records has been reduced from over thirty pages (including questions and answers) to only three pages here that contain his essential message. The address has been edited by Thorvald Grung Moe, Visiting Scholar at Levy Economics Institute. Some parts have been slightly modified to fit the current time and crisis. Additions or alteration to the text has been marked by square brackets. All original figures used by Eccles in the address have been inflated by a factor of 16.4 according to the official US CPI index.
Posted in Guest Blogger
Two of our nation’s most influential progressive journalists — Slate’s Matt Yglesias and Business Insider’s Joe Weisenthal — just took on two powerful economic myths.
1. The Myth that The US Government is Out of Money
2. The Myth that A Government Surplus is a Sign of Fiscal Responsibility
It’s hard to imagine a more empowering message. As word spreads, elected officials in both parties will lose their primary excuse for inaction on on a whole range of neglected and underfunded programs. “I’d love to help, but I’m all tapped out,” simply won’t sell.
Nor will the desperate calls for “shared sacrifice” and “entitlement reform” in the name of fiscal responsibility.
A very big thank you to these men, who will undoubtedly suffer the slings and arrows of many of their progressive followers, who have long considered the Clinton surpluses the crowning achievement of modern Democratic governance.
By Stephanie Kelton
My Twitter followers are constantly asking me if I think more spending would really help the economy recover. I understand their skepticism. Many are probably struggling with high debt levels, and the last thing they want is some economist urging them to rack up more debt for the good of the economy. (Bad advice, indeed.) Others have heard President Obama talk about putting Americans back to work by investing in our nation’s infrastructure, educational system, energy future, etc., but many aren’t sure if the “stimulus even worked“, so they, too, wonder if more spending is really the right way to grow the economy. Well, here’s the answer.
Paul Krugman has written an article entitled “Culture of Fraud” about the Romney economics team.
Posted in William K. Black
Tagged accounting control fraud, bank fraud, fraud, Greg Mankiw, ideology
By Marshall Auerback
Michael Kinsley once defined a gaffe as “when a politician tells the truth – some obvious truth he isn’t supposed to say.” On that basis, the recent headline that just popped up might well represent a major gaffe of the Kinsley variety by Treasury Secretary Tim Geithner:
*GEITHNER SAYS EUROPE CAN’T BE LEFT HANGING ON THE EDGE OF ABYSS
Posted in Uncategorized
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