Contraction

John T. Harvey: "The Coming Recession: How Fiscal Responsibility is Economic Suicide"

As you might have heard the economy is contracting while unemployment remains high inching higher especially in real terms again while Washington is too stupid or corrupt across the board to notice. I can't say I didn't see this coming even as just an above average layman. All this focus on austerity is detrimental. After all, spending is actually income and so are deficits which are the life blood of the private sector in the economy when it comes to those sectoral balances you hear me always harping about.

And on that point I refer to Post Keynesian economist Wynne Godley as he along with MMT economist L. Randall Wray predicted this crisis in 2000 and that matters. Therefore it's safe to say the Post Keynesian school is pretty much vindicated. And part of this tradition can be read in Forbes magazine every month. Imagine that! I have thanks to discovering the work of the most excellent Post Keynesian/MMT economist John T. Harvey.

I have to thank NY brit expat for introducing me to John whom is not only a brilliant economist, but an all around cool guy who is very approachable and has an awesome taste in music. He stresses that the economics discipline hasn't made economics very understandable to the general public and he's right; however, you wouldn't know that by reading his many excellent pieces on why everything people think they know about debt and deficits is absolutely wrong. As John points out, it's not only wrong, it pervades this entire ignorant and corrupt political debate happening right now over this stupid sequester that was a creation of the White House and Congress.

As you will read down below, this horrible self induced debt ceiling pro austerity political show where never is heard an encouraging word like full employment, but instead for Peter Peterson's enjoyment, idiotic words praising deficit terrorism(budget balance and cutting our safety net) rules the day. It only amounts to economic decay and a likely recession on the way depending on how much deficit spending is cut in the coming days.

Topic: 

3
Subscribe to RSS - Contraction