Bureaucrazies Versus Democracy

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The most recent of the almost daily “Greek Crises” has made one thing clear: the Troika of the IMF, the EU and the ECB is out to break the gov­ern­ment of Greece. There is no other way to inter­pret their refusal to accept the Greek’s lat­est pro­posal, which accepted huge gov­ern­ment sur­pluses of 1% of GDP in 2015 and 2% in 2016, imposed VAT increases, and fur­ther cut pen­sions which are already below the poverty line for almost half of Greece’s pen­sion­ers. Instead, though the Greeks offered cuts effec­tively worth €8 bil­lion, they wanted dif­fer­ent cuts worth €11 billion.

Are Surpluses Normal?

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England’s Chan­cel­lor George Osborne took the Con­ser­v­a­tive Party’s claim to fis­cal respon­si­bil­ity one step higher last week when he announced that they will enact a law which will require British gov­ern­ments to run sur­pluses “in nor­mal times”:

in nor­mal times, gov­ern­ments of the left as well as the right should run a bud­get sur­plus to bear down on debt and pre­pare for an uncer­tain future.” (“Man­sion House 2015: Speech by the Chan­cel­lor of the Exche­quer”)

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How rising debt causes inequality and crisis

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In a (for me!) brief pre­sen­ta­tion with 7 slides, I explain why ris­ing pri­vate debt nec­es­sar­ily causes increased inequal­ity, and leads to an eco­nomic cri­sis when the rate of growth of debt exceeds the rate of decline of wages as a share of national income. Cru­cially, the actual break­down is pre­ceded by an appar­ent period of tranquility–a “Great Moderation”.

This was a short talk to a pub­lic audi­ence at ESCP Europe in Paris, which was pre­sented in Eng­lish and also trans­lated into French by Gael Giraud, Chief Econ­o­mist of the French Devel­op­ment Agency and the trans­la­tor of Debunk­ing Eco­nom­ics (so the sound­track is in both Eng­lish and French).

2 new positions at Kingston University London

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We are hir­ing two new staff at Kingston Uni­ver­sity: one per­ma­nent posi­tion at Asso­ciate Pro­fes­sor level, and one short-term con­tract to cover an absent colleague.

If you’d like to work at one of the few pluralist-friendly eco­nom­ics depart­ments in the world, and you’re suit­ably qual­i­fied, please fol­low the links below for more details and to sub­mit your appli­ca­tion. Or if they don’t work–as a cor­re­spon­dent has told me–send an email to jobs@kingston.ac.uk ask­ing for details.

Asso­ciate Pro­fes­sor position

Short-term lec­turer position

The dead­line for appli­ca­tions is tight: they are due by June 26.


What Is Neoclassical Economics & an Alternative Monetary Macroeconomics

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This is a talk I gave in Tel Aviv, Israel at the invi­ta­tion of the Rethink­ing Eco­nom­ics Stu­dent Forum there (which is a mem­ber of the Inter­na­tional Stu­dent Ini­tia­tive for Plu­ral­ism in Eco­nom­ics), and at the Pales­tine Eco­nomic Pol­icy Research Insti­tute in Ramal­lah, Pales­tine. I cover the defin­ing fea­tures of Neo­clas­si­cal Eco­nom­ics, con­trast these with Post Key­ne­sian Eco­nom­ics, and sim­u­late a debt defla­tion using the Open Source mod­el­ling pro­gram Min­sky.

The naivety of the UK economic debate

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I was inter­viewed by Chris Menon from Every Investor last week and asked to com­ment on the eco­nomic poli­cies of the two major par­ties in the UK elec­tion. Chris’s intro­duc­tion to the inter­view is below; click here to see the inter­view itself.

In an exclu­sive inter­view with Every Investor, Pro­fes­sor Steve Keen from Kingston Uni­ver­sity has warned that politi­cians who pro­mote aus­ter­ity eco­nom­ics are naïve.

The econ­o­mist, who was one of the few who pre­dicted the Great Reces­sion, warned last year that the US and UK economies wouldn’t make a sus­tain­able recov­ery due to the prob­lem of high lev­els of pri­vate debt – pub­lic debt being more a symp­tom than a cause of this eco­nomic malaise.

Keep It Simple And Complex, Stupid

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My last post sup­port­ing the use of non­lin­ear mod­els (“You Do Need A Weath­er­man”) gen­er­ated some thought­ful responses, mainly along the lines of this post by Ari Andri­copou­los enti­tled “A View on the Eco­nomic Model Debate from a Non-economist (but some­one who builds mod­els for a liv­ing)”. The basic argu­ment is that a full non­lin­ear model of any sig­nif­i­cant eco­nomic process would be too com­pli­cated, and that it was bet­ter there­fore to stick with tractable lin­ear mod­els, while keep­ing in mind that the real world is nonlinear:

You Do Need A Weatherman

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I’ve just come back from the annual Insti­tute for New Eco­nomic Think­ing con­fer­ence in Paris, where the Pres­i­dent of INET Rob John­son is infa­mous for open­ing every ses­sion he chairs with an apt set of lyrics from the 1960s. I’ve aped Rob here by mis­quot­ing one of Bob Dylan’s great lines “You don’t need a weath­er­man to know which way the wind blows”. In fact, you do.

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Bernanke-Summers Debate II: Savings Glut, Investment Shortfall, Or Monty Python?

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A Twit­ter fol­lower accused me of being “a lit­tle nasty” with my last blog post (see Fig­ure 1). He was right, and I don’t apologize.

I’ve spent 40 years try­ing to high­light just how lim­ited the dom­i­nant ideas in eco­nom­ics are. But even I didn’t fully appre­ci­ate how tiny the intel­lec­tual gene pool behind these ideas was.

Then, as I started to write a post on the eco­nomic issues in the Bernanke-Summers debate, I re-read Sum­mers’ orig­i­nal sec­u­lar stag­na­tion post and real­ized that, not merely were the ideas com­ing from a sin­gle per­spec­tive, most of the major pro­po­nents of these ideas came not only from the same Uni­ver­sity (MIT), and even the same sem­i­nar (Class 14462, con­ducted by Stan­ley Fisher).