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News & ArtsWednesday, January 21, 2009
Economy The Life of the Economy
Posted by Charles Mudede on Wed, Jan 21, 2009 at 9:39 AM
In his letter to Obama, Paul Krugman makes this excellent point:
You can also do well by doing good. The Americans hit hardest by the slump — the long-term unemployed, families without health insurance — are also the Americans most likely to spend any aid they receive, and thereby help sustain the economy as a whole. So aid to the distressed — enhanced unemployment insurance, food stamps, health-insurance subsidies — is both the fair thing to do and a desirable part of your short-term economic plan.At this stage of things it is foolish to give money to the rich (to banks) for this reason alone: they have turned into what Marx called "capitalists gone mad"—meaning, they have become misers. They will not supply this type of economic system the fresh investments it needs to function and survive. The rich are in hoarding mode. The poor, on the other hand, know nothing about hording. They can only spend, throw money back into circulation. And circulation is capitalism in its essence. With the poor, the commodities and money circuit knows no rest (C-M-C-M-C); with the rich, the M-C-M circuit that distinguishes them (separates them from the poor and the middle class) has been shutdown or blocked. At this stage, even socialism of food stamps help the economy, because the poor are the last sane capitalists in town.Even if you do all this, however, it won't be enough to offset the awesome slump in private spending. So yes, it also makes sense to cut taxes on a temporary basis. The tax cuts should go primarily to lower- and middle-income Americans — again, both because that's the fair thing to do, and because they're more likely to spend their windfall than the affluent. The tax break for working families you outlined in your campaign plan looks like a reasonable vehicle.
2
at this stage it's foolish to think that a failed model of consumerism will be enough to buoy the economy
3
damn, @1 beat me to it. I guess Mudede can only think in tribal terms, and thus cannot distinguish horde from hoard.
4
The poor don't itemise on their taxes. How about vouchers for merchandise? You can use them to purchase consumer items either as discount coupons or get change back on a purchase. The poor are most likely to use them that way.
5
In this sense the Bush years were among the most populist because they disconnected the super rich from ways to increase their hoards.
6
The plan to give out money to boost the economy is Keynesianism. It isn't anything promoted by Marx. And it's very simple pump priming that does nothing to change the econimy into real socialism. The socialism of food stamps is really just liberalism and has nothing to do with socialized ownership of the means of production.
And the essence of capitalism isn't circulation. Wrong again. It's not called circulationism, you know. The essence of capitalism is, um, capital, which Marx saw as hoarded up value extracted from labor. (Actually, that's only partially true, Marx basically ignored technology as the key to rising productivity, something that Krugman spent his whole career as an economist focusing on. Technology including human capital, software, the whole gamut).
Anyhoo, the Phoenicians had circulation and the feudal economy had circulation and Chinese traders had circulation and guess what -- the USSR communist economy had circulation and no, circulation or trade isn't the essence of capitalism.
IT's part of it, but it's part of every other type of economy, too, so it's not the essence of capitalism. Capital is.
Isn't it time to put away childishly confusing basic Keynesianism with Marxism or socialism?
It would be un-Obamaist to fail to return to responsibility, including knowing what you are talking about.
And the essence of capitalism isn't circulation. Wrong again. It's not called circulationism, you know. The essence of capitalism is, um, capital, which Marx saw as hoarded up value extracted from labor. (Actually, that's only partially true, Marx basically ignored technology as the key to rising productivity, something that Krugman spent his whole career as an economist focusing on. Technology including human capital, software, the whole gamut).
Anyhoo, the Phoenicians had circulation and the feudal economy had circulation and Chinese traders had circulation and guess what -- the USSR communist economy had circulation and no, circulation or trade isn't the essence of capitalism.
IT's part of it, but it's part of every other type of economy, too, so it's not the essence of capitalism. Capital is.
Isn't it time to put away childishly confusing basic Keynesianism with Marxism or socialism?
It would be un-Obamaist to fail to return to responsibility, including knowing what you are talking about.
7
the marxist model of defining people by what they consume perpetuates the socialist dehumanization that eventually allows for actually depopulating the planet, people being evil consumers.
before things are consumed they are produced. if we defined people instead by their creative production and encouraged them to be creative we would define humanity differently, primarily as uniquely talented, gifted, valuable, novel, etc.
the marxist model is older than the gasoline engine.
before things are consumed they are produced. if we defined people instead by their creative production and encouraged them to be creative we would define humanity differently, primarily as uniquely talented, gifted, valuable, novel, etc.
the marxist model is older than the gasoline engine.
8
Nice theory if you want to buoy the economy of China. The "poor" etc. will ony rush to Walmart (China) to spend their windfalls. Further weakening their own job prospects.
9
So this is how the US "economy" works now:
The government gives endless billions to the insolvent banks who pay their executives seven figure salaries and bonuses, then invest the balance in Treasury bills making sure taxpayers see no benefits.
Rinse and repeat.
The government gives endless billions to the insolvent banks who pay their executives seven figure salaries and bonuses, then invest the balance in Treasury bills making sure taxpayers see no benefits.
Rinse and repeat.
10
Look, the ROI on investments in the rich and ultra-rich is very low - because they tend to save and invest worldwide and not to spend and invest locally.
Hence, tax cuts for the rich and ultra-rich - bad.
But give someone barely making ends meet an extra $500 and they'll spend most of it locally, creating more jobs.
Hence, tax cuts for the rich and ultra-rich - bad.
But give someone barely making ends meet an extra $500 and they'll spend most of it locally, creating more jobs.
11
Will, spending $500 at your local Walmart/Kmart/Target only benefits a few "locals". Underpaid clerks, truck drivers, low level managers. The vast bulk of the purchases end up benefiting distant middle/high level managers, stock holders and especially China.
Perhaps the upper middle class and up will buy more expensive local food, art, higher construction folks.
Perhaps the upper middle class and up will buy more expensive local food, art, higher construction folks.
12
Will, spending $500 at your local Walmart/Kmart/Target only benefits a few "locals". Underpaid clerks, truck drivers, low level managers. The vast bulk of the purchases end up benefiting distant middle/high level managers, stock holders and especially China.
Perhaps the upper middle class and up will buy more expensive local food, art, higher construction folks.
Perhaps the upper middle class and up will buy more expensive local food, art, higher construction folks.
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