Of course it's not right to continue with Keynesian policies. Keynes was always dead wrong.

yes, how long with this dumb game go on relying on cheap money and low interest rates.

It is a stack of cards waiting to fall, and we are getting nearer every day.

Not having a Flat Tax system & over-the-top Public Service salaries doesn't do anything to improve the situation.
There's too big a gap between revenue creators & revenue takers ! An imbalance that will never balance without a Flat Tax !

I shouldn't worry too much. After all, the Morrison Government, has enacted a number of business-friendly policies that will socialise the debt as we continue to privatise the profits? And get the younger generation off welfare?

Got to be a win-win and all but make older workers past their use-by date? redundant? And all but force that cohort to divest themselves of their assets? Plus boot them, their experience and the wisdom only conferred by years! Onto the scrapheap?

Leaving the socialised debt burden for the Grandkids? After we cook them with unmitigated climate change and purloin their incomes as much as poss?

We'll b ok six feet under! Who cares? Not the pretenders announcing an old rebadged announcement or promising to review a review about a review?

[Esalie, beautiful flowers, you are my dream of paradise completed. You are my dream come true.]

You get the picture?
Alan B.

OF COURSE private sector debt is a burden. But that debt exists for a reason: to fund private sector investment. And that investment is an economic benefit. Indeed the investment wouldn't be made if it were not expected to be profitable, so it's safe to conclude the benefits it brings outweigh the burden of debt.

>To the extent that government credit creation encourages banks to lend more,
>MMT brings the financial system limit closer, burdening economic performance.

The above statement is false because the financial system limit is not a fixed amount. Also, by highlighting the possibility of using fiscal stimulus in place of monetary stimulus, it could be argued that MMT shows how to move the financial system limit further away.

As the Reserve Bank Governor said recently we, the RBA, can just click
the money into existence.

WOT POT CALLING KETTLE BLACK?

A great article - everyone should read, including the book advertised.

Though article draws a long bow when it broadly questions the very same private enterprise system (of which banking is an integral part) that employs investment managers and book sellers.

In that regard, below the article, all should buy what is advertised:

"The Financial System Limit is published by Sparkling Books, ISBN 9781907230783 ($A 20). There is also an e-book 9781907230776. The introduction and first chapter can be read without registration at www.sparklingbooks.com/limit.html."

Good fortune in enterprise to all.

debt exists for a reason: to fund private sector investment.
Aidan,
Yep but that funding should be for Govt projects to engage the Private Sector not help their investment.
After they get paid they can invest in whatever they see fit, just don't expect us via Govt to fund their investments. They have to work for that first !
Get rid of that insidious commercial Welfare that is Negative gearing ! They must be made to pay a perhaps slightly lower business GST but pay they must. Their personal income should not be allowed to be reduced to no Taxes paid yet still reside & live an affluent lifestyle.

plantagenet,
Have you read the entire book?
What do you think of the criticism I made further up the thread?

__________________________________________________________________________________

individual,
>Yep but that funding should be for Govt projects to engage the Private Sector not help their investment.

What do you mean by "that funding"? I notice you sniped my comment to...
| debt exists for a reason: to fund private sector investment.
...removing the context in which I was clearly referring exclusively to private sector debt.

Private sector funding should be for whatever the private sector can do profitably (within legal and ethical constraints).

Now, when it comes to "Govt projects to engage the Private Sector" you seem to be unaware that such engagement does help private sector investment, as it provides opportunities to make private sector investment profitable. Saying they have to work first is quite an ignorant statement, as the work they do isn't going to have much value if they don't have the right machines.

If you're saying you're against subsidies, that's fair enough - but that has nothing to do with the comment you're replying to. Creating an economy where there are ample opportunities for the private sector to make money is a very important role of government, and widespread unemployment will ensue if the government fails at it.

Closing tax loopholes is also desirable, but of very little relevance to the issue being discussed.

Aidan

Don't know what you're on about meine Hibernian Muchacho.

I don't need to Buy an author's marketed book

to type my free comment on an article.

Cheerio

Planta

you seem to be unaware that such engagement does help private sector investment, as it provides opportunities
Aidan,
That's what such engagement is supposed to do, stimulate the local economy of which the private sector is a major component. What it is not supposed to be doing is to fill the Bank Accounts of Private sector Bosses who don't provide employment i.e. such as those who go bankrupt & leave subcontractors stranded with the Govt bureaucrats' blessings !

I get that the usual numbskulls, who basically, do not understand how an economy works/economic parameters!? Are all over the shop on this debt issue. There's a time and place for debt! Just not for flogging dead horses or funding recurrents!

This is a time for governments to step up to the plate with visionary nation-building Projects! Rapid rail would be my first choice given, with the right paradigm and management in place! The thing would all but fund itself if supported by government-guaranteed, self-terminating, tax-free, thirty-year bonds!

The self-funded retirees/super managers the world over would trample each other in the stampede to subscribe. Given this would be an investment vehicle That would not change over the life of the investment as guaranteed by the national government, the treasury, and the reserve bank!

The thing that prevents such projects here, is (Mr Smirk) the old boy's club and cronies protecting cronies/vested interest!

Haseen. I take your fuzzy wuzzy comment and mostly agree, except if we embarked on visionary nation-building projects? And we could! We'd need all hands and our friends across the Pacific!
Alan B.

plantagenet,
I never said you needed to buy it. But you seemed intent to shill it.

BTW did you see the program on SBS at 7:30 about Britain's most Plantagenet town?

___________________________________________________________________________________

>...such as those who go bankrupt & leave subcontractors stranded with the Govt bureaucrats' blessings !
I think they're a figment of your imagination. If not, can you provide an example?

Hi Aidan

Thanks for asking.

Naturally I watched SBS, 7:30, about Canterbury "Britain's most Plantagenet town" in the "Britain's Most Historic Towns" series http://en.wikipedia.org/wiki/Britain%27s_Most_Historic_Towns

My Plantagenet forebears were a mixed lot. An unwholesome bunch of vicious basically ex-Normans to many.

Even my Plantagenet ancestor Richard I "the Lionheart", was meant to be a Good King according to misplaced legend. But Dick I, hardly spoke English, loved war and stripped England of its wealth to fight wars for fun, in far off lands. http://en.wikipedia.org/wiki/Richard_I_of_England#Modern_reception
____________

On a positive note:

Another reason I watch all of "Britain's Most Historic Towns" is I have a thing for brilliant, beautiful, happy, articulate woman.

In that regard knowing Alice Roberts http://en.wikipedia.org/wiki/Alice_Roberts is a pleasure.

Regards

can you provide an example?
Aidan,
It's against the Law to do so but I'll suggest to you to open your eyes & ears & listen & watch current affairs programmes etc.

Alan, there is no doubt that there is a place for deficit spending in the cycle of economic policy.

However, it is all one way now as the world has run out of solutions to complex issues.

Spend, spend, spend and to hell with long term consequences, albeit any solution is going to cause real pain.

Chris Lewis,
What do you imagine those long term consequences are, and why?

the world has run out of solutions to complex issues.
Chris Lewis,
All that needs to be done to counter that complexity is to put common sense people in charge instead of "qualified" ones.
The problem is to get close enough to push the first Domino in the revenue-taking self-protection Elite that outnumber the revenue-making caste !

Aidin,

if an agreement emerges between major countries in the future to write off debt as a solution, which may indeed happen, this undermines the capitalist system by telling borrowers they need not pay, and investors to be even more wary who you lend to.

Without the normal boom and bust cycles, where is the discipline to tell individuals, companies and nations to live within your means.

And the longer it goes, the worse off will be the ill effects which will come from a major depression which will leave many people struggling.

Another effect is that the current trend clearly rewards the well off most through home ownership and shares, which will further undermine confidence in the system and maybe even promote rogue ideas and sentiment.

Now people with savings are penalised by having their real value undermined by zero interest rates against inflation.

I am not a genius, but a good start by our political leaders would be to admit that we face major economic problems

Chris Lewis,
Such an agreement would not undermine the capitalist system at all - firstly because most countries already have bankruptcy laws, and secondly because debtors have always been free to negotiate with their creditors.

If you think you need boom and bust cycles to get people, businesses and governments to live within their means, then maybe you should reconsider the case for living within their means. But first you should be clear what that actually means - if you think it means avoiding borrowing, think again!

Even this year, with huge shutdowns, Australia avoided a major depression. They're actually quite easy to avoid, and also easy to get out of.

High share prices are a good thing; they enable businesses to cheaply fund their investments. High house prices are more of a problem. Land value taxation is the best solution, though this would have to be phased in over many ears to avoid unduly disadvantaging existing homeowners.

Do we really want to encourage people to hoard money?

of course Australia avoids large recessions, twice now by spending billions and billions of money through debt. increases debt burden on future generations.

You reckon that is an achievement, anyone can do that if they have the purse string through govt.

Whoopee do.

and they do so now through zero or negative interest rates.

as for me, i do live within my means. not interested in the share market.

and I live comfortably.

one more consequence of the huge explosion of debt in last twenty years.

Who is that has benefited most in national terms from debt in a world of increasing economic interdependence, it is China under the CCP.

Chris Lewis,
>of course Australia avoids large recessions, twice now by spending billions and billions of money through debt.
And we have the ability to do it an infinite number of times.

>increases debt burden on future generations.
No it doesn't. Future generations have no obligation to eliminate the government's debt.

>You reckon that is an achievement, anyone can do that if they have the purse string through govt.
But not everyone did.

>one more consequence of the huge explosion of debt in last twenty years.
>Who is that has benefited most in national terms from debt in a world of
>increasing economic interdependence, it is China under the CCP.
Right... because while those running other countries were spreading lies like "we have a debt and deficit disaster" and "future generations will pay if the government doesn't balance its budget now" those running China were doing the sensible thing and investing in making their country more productive.

Aidan,

I am glad you see no problems ahead.

It is great that some people need not stress about the future.

I think it is a world of make believe that you talk about, but I hope my pessimism is proven wrong.

Chris Lewis,
Actually I see many problems ahead; just none caused by debt.
Future generations may pay dearly for our reluctance to address the climate change issue.

Future generations may pay dearly for our reluctance to address the climate change issue.
Aidan,
If our Generation stuffs the planet sufficiently to reduce the population than we should look at future generations as beneficiaries !

individual,
Your claim is absurd.
If our generation stuffs the planet sufficiently to reduce the population, the survivors of future generations will still be worse off because the planet will be stuffed - a lower population would bring no benefits whatsoever.

a lower population would bring no benefits whatsoever.
Aidan,
the above is utterly absurd !

Individual,
Then how about providing some counterexamples? Exactly what benefits, other than avoiding the planet being stuffed, would a lower population bring?

Aidan,
You answered your own question !

So don't worry about debt, keep the economy gong with consumption and so on.

But we need to worry about the environment and do more.

Says it all really.

I recognise contradictions, do you?

Individual,
No, I haven't answered my own question. Once the planet is stuffed then a lower population won't unstuff it!

You seem to be so obsessed with the population that you forget everything else, including the reason why the population can be a problem!

______________________________________________________________________________

Chris Lewis,
Of course I recognise contradictions. And I recognise why apparent contradictions are not what they appear to be.

In this case it's because the value of economic activity is not proportional to the amount of environmental damage it creates.

including the reason why the population can be a problem!
Aidan,
Too many humans IS the problem !

individual,
Your delusional answer proves my point!

Environmental degradation is the problem. The number of humans is a contributing factor to that, but nowhere near as big a factor as the attitude the humans have towards nature.

Environmental degradation is the problem.
Aidan,
And, who do you think causes the environmental degradation then ? Mud crabs, Clown fish & echidnas ?

individual,
There is of course some human involvement; were there not, it probably wouldn't even be recognised as environmental degradation. But the simplistic notion that population is to blame for everything fails to take several things into account:

• Much of the environmental degradation is the result of past rather than present human actions. For example, consider the impact of rabbits and foxes on the Australian environment. While you're at it, consider the fact that their numbers were never proportional to the number of humans here.

•Different people have different impacts on the environment. In the past, environmental impact has been strongly correlated with standard of living, though there have long been things that could be done to reduce environmental impact without reducing standard of living. But the relationship is breaking down because technology enables an increase in efficiency, and also enables the harvesting of resources that would otherwise go to waste (such as wind).

• Environmental impact isn't always negative. It's not just a case of damage mitigation; people can actively improve the environment.

Aidan,
The rabbits were a human introduced disaster then just as indoctrinated brainless wonders are now !