We really need a public that doesn't think "demand" is the primary driver of unemployment right now

Thanks to Daniel "Strangelove" Kuehn for such an excellent marketing theme in my quest to explain and expose the Keynesian Hoax to the public. 

In our real world of human exchange, "demand" just might be the king of all garbage terms used in "economics".  

If you have something to exchange, you might exchange it. If you don't, you won't because you can't. Is that so wrong?

COLUMBIA JOURNALISM REVIEW'S RYAN CHITTUM BECOMES HACK ADVOCATE FOR UNPAYABLE KEYNESIAN DEBT

From the CJR“Audit” blog:

Ryan Chittum , a former Wall Street Journal reporter, is deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at rc2538@columbia.edu.

Mr. Chittum is quite upset that CNBC is suddenly engaged in “advocacy journalism” because of its scaremongering about the “fiscal cliff” and because it is not giving equal time to the notion that there is nothing wrong with the unpayable debt or that we could even use more unpayable debt.  Somehow the REALLY BIG SCANDAL, the total “journalistic” suppression of the Austrian School for 40 or 50 years, is not news.  I tried posting the following comment, but it failed to clear “moderation”. Perhaps because it wasn’t “moderate” enough?

We see not a word from our business press watchdog about the Austrian School, of course. Austrian economists predicted the housing bubble and bust, and still not a word about it.  Ron Paul convinces Congress to audit the Fed and still not a word about it.  It would only take a 24 hour cable channel fifteen seconds once a week to say something like:

"Friedrich Hayek won the Nobel Prize in 1974 for his work on the Austrian Business Cycle Theory which holds that not only do monetary ‘stimulus’ and fiscal ‘stimulus’ not cure depressions and recessions, those policies are the cause of depressions and recessions". 

To which they could easily add: 

“And, of course, no anti-Austrian in the past 60 years has ever bothered to familiarize themselves with even basic Austrian School concepts”. 

Krugman is clueless on the subject. Austrian School economist Robert P. Murphy of NYU has raised over $80,000 to entice Krugman to debate, but the cowardly Krugman refuses.

I can recall only two serious mentions of Hayek on mainstream television in the last 40 years.  Hayek was on “Meet the Press” in1975 of which I made an audiotape:

In 1977, Hayekwas on “Firing Line” wherein he explained how Keynesianism became so popular:

Hayek:  "You see, another political element was that, of course, politicians just lapped the argument and Keynes taught them if you outspend your income and run a deficit, you are doing good to the people in general.   The politicians didn’t want to hear anything more than that -- to be told that irresponsible spending was a beneficial thing and that’s how the thing became so influential."

On  the same show, Hayek explained that Keynesian was primarily a ruse to trick British workers into accepting lower nominal wages than they were otherwise prepared to accept:

Even the Keynesians know that the public does not understand or support Keynesian policy:

Obama:"Look, I get the Keynesian thing. But it's not where the electorate is…"  p. 338.

Would someone explain why it is that the CJR is unconcerned with the total suppression of even a brief description of the Austrian Business Cycle Theory,  a theory which easily and thoroughly explains why Keynesianism (and its cousin, monetarism) is a ruse and how it is the cause of our present misery.  Especially after Hayek was awarded the Nobel Prize?

UPDATE!!!!!  UPDATE!!!!!!

Anonymous wrote in the comments:

ABCT is complete garbage. If Hayek understood economics than he would not have said this:

“When the government of the United States borrows a large part of the savings of the world, the consequence is that capital must become more scarce and expensive in the whole world. That’s a problem.” -Hayek

I finally get it!  Just because scarce resources are employed by the government to blow money out its ass and pay off its supporters, the very same scarce resources can be used at the very same time for capital investments! I never knew that!

O'Reilly warns about how vicious the left is

I watch O'Reilly so you don't have to.  Last night at the start of his show, he again warned us about how vicious the left is .

Then he had John Stossel on for the weekly 5 minute Stossel segment. Stossel again spoke out against the stupid anti-gouging laws plaguing the Hurricane Sandy victims.  O'Reilly objected and called Stossel a fascist thereby proving O'Reilly's point that leftists are truly vicious. 

Encirclement - Award winning documentary in which French commies blame Hayek for the World Bank

L'ENCERCLEMENT

La démocratie dans les rets du néolibéralisme 

This is an absolutely amazing display of the total ignorance of the left.  This is allegedly a "documentary on the real history of libertarian free-market fundamentalism".  A bunch of weenie French and other leftists literally blame Hayek, Mises and the Austrian School for the present day Keynesian welfare/warfare crony capitalist state.  

Part 1 can be seen here. 

Part 2 can be seen here.

The entire thing is 150 minutes of talking.  The clip above is only about 9 minutes long.

UPDATE!  I was excited when I saw that Susan George was going to be one of the film’s commentators. 

  

Sorry. Wrong Susan George. 

Here is the website for this preposterous documentary which seems to have won a barrelfull of  awards from commie movie reviewers.  It continues a perfect batting average for the critics of the Austrian School since there has never been a single one that understood even the most basic Austrian School concepts or libertarian concepts.  They are congenitally unable to distinguish a fiat money regime from a competitive market in money for example. They cannot and will not differentiate between laissez faire and crony capitalism applying the dishonest yet silly term "neoliberalism" to both.   Again, they are simply amazing. 

"A critical and intelligent thesis, as dense as hail, on the origins
and strategies of neo-liberalism and its global neo-colonialist effects."

- Martin Walder, Neue Zürcher Zeitung

"These thesis criticizing globalization are well known,
but we have never seen them exposed so radically in a film."

- Eberhard von Elterlein, Berliner Morgenpost 

 

"Listening to these specialists unravel with stunning clarity the roots of neo-liberalism, the mechanisms of its expansion and the ideas it conveys is a fascinating experience."

- Malik Berkati, Le Courrier (Genève)


"The most conspicuous focus of the 39th International Forum were a number of documentaries on burning contemporary issues. [...] The radicality of Brouillette's summation is reflected in the rigorous design of the black-and-white film in ten chapters.

- Martin Girod, Neue Zürcher Zeitung

 

Hopeless MMTers try to explain things to Erskine Bowles

The MMTers are dumber than a crate of anvils (which actually explains how they can believe that an unlimited supply of "dollars" has solved the problem of scarcity).  Their mighty leader, Mike Norman has boldly announced that the anti-gouging price control regime in New Joisy is the free market,  Do they think this is going to hurt our feelings?

Now, they try to explain their bizarro views to Erskine Bowles.  

 "Fiat" means an order from a SWAT team.  Of course, if "there’s no static asset metric that a unit of account is convertible to upon demand", the government, via its SWAT teams, is unconstrained in robbing everybody everyday all the time and transferring the loot to itself and its friends.  And the MMT guys wonder why we're heading towards a surveillance state.

Simple network dynamics dictate that to make liquidity co-scale with expanding options, a growing population and economy must steadily increase fiat incomes and savings, NOT maintain buying power of the unit of account

There is no basis in fact, logic or theory as to why a growing population and/or economy must steadily increase "fiat incomes". Everyone should always be concerned with maintaining buying power of the "unit of account" or else it isn't much of a unit of account. Everyone should be concerned with increasing their real incomes.  And everyone must always be concerned about saving enough to use for investments for the future.

Obviously, the government can always steal what it wants to steal by spending money into existence but even the thieves, murderers and cutthroats who run the government are smart enough to maintain some resemblance in the current system the existed in the old system so that taxation approximates what the government wants to spend and the rest is or appears to be borrowed.  They are smart enough to know that the MMT proposition is insane. In fact, when average people learn that the government can spend money into existence, they will be properly appalled.  The do not know this because Keynesianism, being a scam for the government to loot the masses, is intentionally confusing and obscure. We can thank the MMTers for making it less obscure.

Finally, the fact that the government cannot run out of "dollars" does not solve the problem of scarcity or create the $200 trillion in goods and services promised to all by the government. The only thing that spending money into existence can accomplish is to steal purchasing power from a victim and transfer it to the government's buyer or recipient. This will cause fewer people will invest when one's savings and property are never safe from the kleptocratic pillaging Keynesian state.

MMT is for people who cannot tell the difference between a free market and an anti-free market regime of price controls and for people who think the government is omniscient, efficient and benevolent. In other words, hopeless dolts of the amoral variety.

MMTers also cannot defend their claim that fiat funny money gets its value because people have to pay their taxes with it

Warren "Hut Tax" Mosler again makes the phony central MMT claim:  Contrary to general perception, fiat money is driven by the fact that taxpayers need the government’s money to pay their taxes. By levying a tax, the government creates a need for its fiat currency.

As with most everything MMT, that central claim too is a load of crap. People got used to using bank notes for specie and then went to government schools where economic denialism is taught. Thus, they didn’t notice when the essential phrase about being redeemable in gold/silver started to be left off the notes and when the coins stopped being silver and became copper. The government imposed sales and exchange taxes on the use of other forms of money such as gold, silver and foreign money. That is what keeps people using U.S. fiat inflationary funny money. Absent the taxes on the sales and exchanges of gold, silver and foreign money, people could easily use other more stable forms of money and then exchange their good money for U.S. fiat funny money at the last possible moment to pay their U.S. taxes. 

Note the lame to non-existent defense of their central claim by the MMT commenters.

MMTers still cannot answer the big question: Where will all the stuff come from to satisfy the unpayable debt?

The MMTers are in a giggly mood because Greenspan said this:

“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.”

Bob Wenzel reports that German officials are worried about U.S. debt levels:

  

It's not only German officials who are concerned with [U.S.] debt levels. Former senior finance officials in the U.S. have indicated grave concern to me about U.S. government debt levels. Major inflation or default are the only two ways they see out for the U.S.

But for the MMTers, all such problems are easily AND painlessly solved because the government can never run out of “dollars”!  Only “morons” worry about from where the actual goods and services will come.

In response, Dan Kervick demonstrates his deep understanding of economic calculation and the pricing process plus how fiat funny money creation and government spending distort that process [not]:

  

One part of the MMT answer to Greenspan's question about the creation of a sufficient amount of real assets is to insist that we should always hire everyone willing and able to work, so that they are usefully producing useful real assets, rather than remaining unemployed.

The private sector system [emphasis added] foolishly misallocates large numbers of our people to the role of non-producing consumers of subsistence incomes. This system is both stupid and cruel. It's a ridiculous failure to invest our human resources wisely, and a savage failure to provide social solidarity and justice.

Tom Hickey simply exclaims that MMT shows how the economy operates optimally:

Bob Roddis, "That's the big question your silly MMT cannot answer, isn't it?"

Greenspan's could have been said in exactly the same words by any MMT proponent that understands MMT. The real resources will be available if the economy operates optimally in resolving the trifecta of growth (production) employment, and price stability. MMT shows how to accomplish that. [WHERE DOES IT SHOW THIS?]

And Roger Erickson employs some passive [aggressive] language to announce that the government will have to continuously monitor everybody and everything all of the time to make sure that no one is “hoarding”, the MMT term applied someone to trying to save some more of his earnings than the secret MMT police might allow.

Excessive or insufficient hoarding of static, financial assets, unused or poorly used are the simple tolerance limit we're tasked with avoiding.

I pointed out that none other than Hayek has said the very same thing almost 40 years ago: "No country can go bust!" But they naturally ignored that point.

Hayek: "No country can go bust. All that happens is that economic conditions of daily life are getting much worse, so there will be scarcities. People will find that their income is no longer sufficient to maintain their standard of life. They will come to distrust first the present government and present policies, and may then be willing to return to an altogether different system. But I'm no prophet; 

Aren’t you glad that the MMTers explained where all the stuff to pay the debt will be coming from?  And aren’t you glad they showed us their deep understanding of economic calculation?

The essence of MMT: When people save or refrain from "spending", that shrinks the pool of funds so the government must inject more fiat funny money into society

I asked the MMTers if it was true that when people save or refrain from "spending", that shrinks the pool of funds so the government must inject more fiat funny money into society.

Tom Hickey explains:

What do you think will happen if saving erodes the amount of money for consumption? Let me guess. "Prices will decline."

Well, we know what actually happens. Prices don't decline fast enough to offset, so unplanned inventory builds, businesses cut back production and lay of workers so that unemployment rises.

When commenter Paul wrote: "There is another option, tax or confiscate all excess savings and spend it back into the economy.

Hickey replied:

Yes, and in a saner system this would be standard operating procedure in the case of gain through rent-seeking, from which most of the saving in excess of reasonable provision for future need (hoarding) arises.

They know this to be true because MMTers know how our monetary system works. And because they know how the monetary system works, they can determine EXACTLY what amounts people should be allow to save in excess of reasonable provision for future need, right?  These conclusions follow logically and directly from noticing that the government can create all of the “dollars” it wants to out of thin air.  That's logical, right?