mikema63 wrote:Is that paradigm in the video? :?:
I think so, I checked out some other videos after I found it- some philosophy stuff on the fallacy of interconnectedness, promoting anarchism, and a segment on Fascism that
actually knew what fascism was. My first thought was, well, maybe Paradigm was a fan of this guy- but I'm thinking that's him.
BTW, selected it by complete accident. It was three videos down and it wasn't until it started playing I made the connection.
Oldmanonfire wrote:Who owns the $16 trillion in debt? 2/3rds of it is held by people and business in the USA. Therefore, paying about $10.5 trillion to people and business in the USA will certainly stimulate the economy. The debt payment to China, Japan and many other nations won't do much if anything for the US economy.
Except that paying $10.5 T would be nearly impossible. You completely ignored my point on endogenous money- as the government paid those $10.5 off, to banks, btw, who have no current demand for loans, it'd deflate the monetary supply in turn, increasing the value of remaining liabilities for itself and for business. It would have the opposite effect- nobody has demand for loans, the banks to create new money and no-one invests in anything.
OMoF]Currently the US is paying $450 billion in annual debt interest payments. This is taxpayer funds. If this debt interest payment was not in place, this means $450 billion per year can either be allocated elsewhere or result in less taxation.[/quote]
$225 billion per annum, not $450b/yr. You've nearly doubled the value- not that there isn't a point there, but you're still completely ignoring monetary policy.
[quote="OMoF wrote:Both of the above, IMO, will not cause deflation but instead will stimulate the economy.
Based on
what? You're pulling money
out of existance, that's called "deflation". You don't seem to realize, paying down debt doesn't return money into circulation, it erases it. By
borrowing, we have new money to offset personal liability repayments and continue circulation.
OMoF wrote:Regarding your $7 trillion stimulus, at $700 billion per year over ten years, it is guaranteed the stimulus money will be spent but there is no guarantee that the economy will grow any faster than current growth numbers. The $7 trillion will create a false economy while the money is being spent but no guarantee that the private economy can act in parallel.
1) I highlighted the effects of debt assuming there were no economic changes; if values remain the same while we double the supply of money, we still end up w/ roughly the equivolent of $3T less than today.
2) In order to assume it won't grow faster over that period, you have to ignore the impact of various spending projects- such as high-speed rail on transportation costs, microgeneration on household economies and supply of energy, etc- while simultaneously ignoring the impact on private debt, i.e. business liabilities shrink in comparison to capital asset values, allowing them to begin borrowing again sooner.
I explained these previously, I'm not sure why you insist on ignoring these factors.
OMoF wrote:I have written in these forums that if we budget $500 billion per year for infrastructure projects, and if the government feels the need to stimulate the economy, then if $5 trillion WAS going to be spent over ten years, go ahead and condense that to 4-5 years, spending about $1 trillion per year. However, the caveat would be that between year 5 and 10, infrastructure spending would need to be greatly reduced, in order to stay on budget over the ten year period. Even in this scenario, there is no guarantee the private economy will grow fast enough over five years to take over where the stimulus money leaves off.
Lastly, instead of only government infrastructure projects, I'd like to see government partner with private enterprise to resolve future issues with potable water and clean energy. I'd like to see 250 more fresh water reservoirs, including hydro-electric power generation, ocean water desalination, and a distribution system of canals and pipelines transporting water to most all areas of the USA. And let's build several solar and wind farms in the areas which allow these systems to be most efficient. Most all of this can be done with private enterprise with government backed loan guarantees. All of this will create millions of jobs and will grow the economy!
I don't disagree on either front-loading debt, the need for new infrastructure, or public-private partnerships as a means of growth. The numbers I chose, $700b, was based on the fact our M2 is ~$10T and 7% growth will double value in ten years. Really, though, the real value of corporate liabilities will decrease enough well before the end of ten years to allow them to begin borrowing again, which is why I see a need to constrain the conditions of borrowing and leveraging, to reduce or prolonge the possibility of a Minsky moment.