Why the US Gov. is not like a household. Or, "Further evidence undermining the mainstream case ..." - Page 2 - Politics Forum.org | PoFo

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#15145083
So, you needd to see the whole 'logic' all laid out.
Well, in science, this is not necessarily necessary.
For example, in Physics the Quantum Theory was based on experiments and not on logic for decades. I'm not even sure that there is a logical explanation even, now about 100 years later.
I assert the all non-MMT economic theories do not made good predictions and never have. This is enough for me to write them off as obviously wrong.
Like I keep saying, MS economic theories are based only on deductive logic using many obviously false assumptions, and in logic any false assumptions invalidates the proof. So, they may seem like a logical system, but the false assumptions invalidate it.

I also assert that in the 70s math discovered Chaos theory, the theory of non-linear equations and reiterative systems. The economy is full of iterative systems and non-linear equations. So, we now have a theory to solve them. It in now not necessary to make simplifying assumptions. However, MS econ. theories had already reached a point in the 70s where it was impossible for the economists to start over with only true assumptions.
. . . I firmly believe that a big part of this is the fact that MS econ. is intended to prove the things that the rich wanted the world to believe. The 70s was the period in which the rich began or accelerated their plan to brainwash the world. [See the links to Powel Report for the Chamber of Commerce of the early 70s.] During the 70s the rich established many famous think tanks and endowed econ. depts. and chairs in univ.

https://en.wikipedia.org/wiki/Lewis_F._Powell_Jr.
https://www.greenpeace.org/usa/democrac ... democracy/
https://billmoyers.com/content/the-powe ... porations/
https://billmoyers.com/content/the-powe ... porations/
#15145197
Steve_American wrote:For example, in Physics the Quantum Theory was based on experiments and not on logic for decades.

Okay, that's a clever point, but economics is something not exotic enough that we should be able to describe it logically, before we hold to a theory.

I think your comparison between an Economic Theory and Quantum Theory here is tenuous at best, for a couple of different reasons.

Steve_American wrote:Like I keep saying, MS economic theories are based only on deductive logic using many obviously false assumptions, and in logic any false assumptions invalidates the proof. So, they may seem like a logical system, but the false assumptions invalidate it.

That would depend entirely on what these particular assumptions you refer to are.
That doesn't really seem to be an area you've gotten into so far.

Can I ask, what exactly is your claim, that counters one of these false assumptions you are referring to?
#15145198
Steve_American wrote:. . . I firmly believe that a big part of this is the fact that MS econ. is intended to prove the things that the rich wanted the world to believe. The 70s was the period in which the rich began or accelerated their plan to brainwash the world. [See the links to Powel Report for the Chamber of Commerce of the early 70s.] During the 70s the rich established many famous think tanks and endowed econ. depts. and chairs in univ.

I will not disagree with you here, but I will point out that still doesn't necessarily mean your theory is correct.

It could very well be there are numerous things about MS that are wrong, but maybe those particular things do not include the things that would allow MMT to be right.

The opposite of an error is not always in less error than the original error.
#15145355
Puffer Fish wrote:Okay, that's a clever point, but economics is something not exotic enough that we should be able to describe it logically, before we hold to a theory.

I think your comparison between an Economic Theory and Quantum Theory here is tenuous at best, for a couple of different reasons.

. . . My reply is => Of course it is. It is just an analogy, and analogies prove nothing. They just illustrate the point being made.

That would depend entirely on what these particular assumptions you refer to are.
That doesn't really seem to be an area you've gotten into so far.

I can give you just a few obviously false assumptions that MS econ. bases its proofs on from my memory of my years of reading MMT authors.

1] The Market consists of just one person who sells everything to himself.
2] Banks loan out their depositors’ deposits. So, savings is necessary for investment lending/borrowing.
3] Natural resources are infinite.
4] All people just use self-interest for all economic decisions.
5] The national debt will have to be paid off someday using only money from taxes.
6] That all unemployment is a choice that poor-lazy people make.
7] All people in the Market have the exact same knowledge about the stuff being sold. Or everyone in the Market has 100% of all possible knowledge about the stuff being sold.
8] [Added with an edit.] MS econ. theory makes a big deal out of how "efficient" the private corps. and the Market are, but it ignores the glaring inefficiency of having 5% to 20% of the work force unemployed.
9] One that I remember was made by an MMTer was that after every transaction in the Market both parties are 100% satisfied with what happened. I think he was joking, though.

Remember, in logic even one false assumption invalidates all of the proof that follows the use of the false assumption. Because MS econ. theories don't appeal to reality at any point and only base their proofs on assumptions, even 10 false assumptions scattered thru their proof invalidates everything they write.

I found this article/book in my searching.
SEVEN DEADLY INNOCENT FRAUDS OF ECONOMIC POLICY, Waren Mossler (2010),
Part I ends on page 68. Parts II & III go on from there. There are 117 total pages.
Link => https://moslereconomics.com/wp-content/ ... s/7DIF.pdf

Not all of his fallacies are obviously false. I chose these 3 as being more obvious.

Deadly Innocent Fraud #2: With government deficits, we are leaving our debt burden to our children. Fact: Collectively, in real terms, there is no such burden possible. Debt or no debt, our children get to consume whatever they can produce.

Deadly Innocent Fraud #3: Federal Government budget deficits take away savings. Fact: Federal Government budget deficits ADD to savings. [The bond is savings for its holder and if any of the money spent is saved then 100% + some% is >100%.]

Deadly Innocent Fraud #7: It’s a bad thing that higher deficits today mean higher taxes tomorrow. Fact: I agree - the innocent fraud is that it’s a bad thing, when in fact it’s a good thing!!! [Here I need to explain what he has already said in the article. His main point is that the Gov. does not collect money from taxes to be able to spend it, because as the CARES Act proved, the Gov. can just spend $2.2T without worrying about “paying for it”. Functionally, all of the $2.2T that the Gov. borrowed to fud the CARES Act was bought by the Fed. Res. Bank. Therefore, if the Gov. in the future raises taxes it can only be because the economy has unemployment under 0.2% and all real resources (factories, energy, metal ores, and other real resources are being fully used for something, so to spend more th Gov. must deprives someone the use of some real resources and taxes is a wy to do that. So raising taxes is evidence that unemployment is almost zero and every resource is being fully used.
. . . To simplify it a lot, it is obvious that all money spent by the US (as a nation with a fiat currency that owes nothing is any other currency, and floats its currency, i.e. doesn't set a peg to anything) is fungible. This means that you can't really tell what the source of any dollar spent was. This means that we can assume that all dollars spent on interest on the debt and on rolling over mature bonds are either created or borrowed by selling bonds. What evidence is there that this has been or is a burden on the people alive in the recent past, now or in the future? What is the reason to assume that all of this spending is made from tax revenue dollars?]

I also found this article.
Fifteen Fatal Fallacies of Financial Fundamentalism
A Disquisition on Demand Side Economics, William Vickrey (October 5, 1996)
Link => http://www.columbia.edu/dlc/wp/econ/vickrey.html

Here I just post the beginning of his 'whys”. The article is much longer. Some are not all that obvious, and I cut out those that he had to explain at great length.

Fallacy 1 Deficits are considered to represent sinful profligate spending at the expense of future generations who will be left with a smaller endowment of invested capital. This fallacy seems to stem from a false analogy to borrowing by individuals.
Current reality is almost the exact opposite.

Fallacy 2 Urging or providing incentives for individuals to try to save more is said to stimulate investment and economic growth. This seems to derive from an assumption of an unchanged aggregate output so that what is not used for consumption will necessarily and automatically be devoted to capital formation.
Again, actually the exact reverse is true.

Fallacy 3 Government borrowing is supposed to "crowd out" private investment.
The current reality is that on the contrary, the expenditure of the borrowed funds (unlike the expenditure of tax revenues) will generate added disposable income, enhance the demand for the products of private industry, and make private investment more profitable.

Fallacy 6 It is thought necessary to keep unemployment at a "non-inflation-accelerating" level ("NIARU") in the range of 4% to 6% if inflation is to be kept from increasing unacceptably.
[He says] … snip... as a goal it is simply intolerable. [He goes on.]

Fallacy 9 The negative effect of considering the overhanging burden of the increased debt would, it is claimed, cancel the stimulative effect of the deficit.
This sweeping claim depends on a failure to analyze the situation in detail.

Fallacy 10 The value of the national currency in terms of foreign exchange (or gold) is held to be a measure of economic health, and steps to maintain that value are thought to contribute to this health. In some quarters a kind of jingoistic pride is taken in the value of one's currency, or satisfaction may be derived from the greater purchasing power of the domestic currency in terms of foreign travel.
Reality: Freely floating exchange rates are the means whereby adaptations are made to disparate price level trends in different countries and trade imbalances are brought into line with capital flows appropriate to increasing the overall productivity of capital.

Fallacy 12 Debt would, it is held, eventually reach levels that cause lenders to balk with taxpayers threatening rebellion and default.
Relevant reality: This fear arises in part from observing crises in which capital-poor countries have had difficulty in meeting obligations denominated in a foreign currency, incurred in many cases to finance imports and ultimately requiring servicing and repayment in terms of exports, … .

Fallacy 14 Government debt is thought of as a burden handed-on from one generation to its children and grandchildren.
Reality: Quite the contrary, in generational terms, (as distinct from time slices) the debt is the means whereby the present working cohorts are enabled to earn more by fuller employment and invest in the increased supply of assets, of which the debt is a part, so … . [These assets include factories to make stuff. So the grandchildren can use the factories and not have to make them themselves.]
This fallacy is another example of zero-sum thinking that ignores the possibility of increased employment and expanded output.

Fallacy 15 Unemployment is not due to lack of effective demand, reducible by demand-increasing deficits, but is either "structural," resulting from a mismatch between the skills of the unemployed and the requirements of jobs, or "regulatory", resulting from minimum wage laws, restrictions on the employment of classes of individuals in certain occupations, requirements for medical coverage, or burdensome dismissal constraints, or is "voluntary," in part the result of excessively generous and poorly designed social insurance and relief provisions.
[Here he is claiming that unemployment is mostly due to lack of effective demand.
. . . In other words, the people lack the income to buy all that can be made if everyone was working. Since the rich don't want to pay their workers enough, the only other source of additional worker income is Gov. deficit spending. So, unemployment is a result of the choice to avoid Gov. deficit spending going to the workers.]
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These are what I remember and what I found. I hope it helped you.
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