Thursday, March 13, 2014

Peter Martin — Muddled Thinking Watch #1 “We will need decades of austerity not years” writes Phillip Booth in the Daily Telegraph

Its not a question of whether it “can be afforded” in money terms but whether “it can be afforded” in resource terms. Present commitments may or may not be able to be afforded at some future time. It will depend on the resources which will be available at that future time.
Alan Greenspan's response to Paul Ryan in congressional testimony: “Well, I wouldn’t say that the pay-as-you-go benefits are insecure, in the sense that there’s nothing to prevent the federal government from creating as much money as it wants and paying it to somebody. The question is, how do you set up a system which assures that the real assets are created which those benefits are employed to purchase.” 
Greenspan lays the smackdown on Paul Ryan

Modern Monetary Theory: Real Economics
Muddled Thinking Watch #1 “We will need decades of austerity not years” writes Phillip Booth in the Daily Telegraph
Peter Martin


3 comments:

Joe said...

Wow. It's breathtaking how profoundly misguided Philip Booth is. He understand absolutely nothing about how an accounting identity works. Somehow every agent in the economy is supposed to run a surplus simultaneously. This stuff just isn't that hard. It's 2nd grade math.

googleheim said...

I talked to some folks from NASA the other night and they have been bomb-barded with tons of pink slips and "budget" deficit hawkism ...

I mentioned that we are not on a gold standard to get the ball rolling ...

and they responded that "yes, well we need to go back on the gold standard so we can have some accountability"

so they self-reflectively think that they need austerity to prove themselves

Roger Erickson said...

Booth could start the process by voluntarily restricting his breathing, not just his thinking?

The former may help us far more than the latter.