This Blog’s Past and Future Predictions (of the end of the world) and Alleged Fraud – Setting the Record Straight

Regular readers will be aware that I have made many predictions (no link found) concerning the precise timing of the end of the world and will continue to do so repeatedly in the future. Specific dates have been set, and then re-set, for an asteroid strike, an invasion of extraterrestrials, spiritual ascension into a higher dimension and, for fundamentalist Christians, the rapture, appearance of Antichrist, great tribulation, Armageddon and second coming. Despite these efforts, which have been made without expectation of heavenly reward, only modest dollar returns, I now find myself under attack. Sadly, there are those who question my motives for all the date setting. Some even allege there are readers who have been swindled out of life savings. Although this kind of attack comes with the territory for a prophet, and indeed I welcome the persecution, it nonetheless seems necessary to address readers’ concerns and shortcomings. For now, time constraints preclude anything more detailed than a summary statement. A book in planning will provide the full scoop. April 1st 2016 is its forecast date of publication; $49.95 is its likely recommended retail price. Both predictions, of course, remain subject to heavy revision.

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Victor Quirk and Bill Mitchell on Unemployment as a Policy Choice

The videos posted below are to talks given last July at a Politics in the Pub session in Katoomba, New South Wales, Australia by Victor Quirk and Bill Mitchell of the Centre of Full Employment and Equity (CofFEE), University of Newcastle. Both speakers emphasize the capacity of a currency-issuing government to ensure that full employment is maintained at all times. All that is missing right now is the political will.

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Taxes as an Inducement to Supply Real Output

In the chartalist view, taxes drive acceptance of state money. Through one channel, taxes induce labor services. The need to obtain state money to pay taxes ensures a willingness of some individuals to accept employment in the public sector in exchange for the state money. There is another channel that exists under a broader range of conditions. It is the power of government to induce supply of real output from private enterprise. Not only does government induce a private supply of real output to itself (a transfer of resources from the private to public sector), but it also induces a supply of real output to private consumers. Unlike the inducement of labor services, the inducement of private-sector output would apply equally to a pure labor economy or a purely mechanized economy, as well as to intermediate cases.

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Some Implications of the Expenditure Multiplier Process

A monetary economy needs spending for production and employment to occur. This is a truism. Spending equals income, by definition. One person’s purchase of a good or service is another person’s income. But it is also clear that causation, ultimately, runs from spending to income. More specifically, the creation of income requires a prior decision to spend. In a monetary economy, to paraphrase Michal Kalecki, each of us in isolation can decide how much to spend but we cannot choose the size of our income. Our personal income will depend not on our own spending but on the spending decisions of others acting somewhat independently of ourselves. Total income, of course, will depend on spending in aggregate – our own spending and the spending of others.

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Syriza — Strategy or Weakness?

Despite some appearances to the contrary, I remain hopeful that Syriza will hold firm in its resistance to austerity. It may be that the Greek government is positioning itself so that, in the event of exit, it is seen to have been forced off the euro rather than to have willingly opted out. In the event of exit, it could make a significant difference to the response of others (such as the US, the IMF, not to mention the Greek people themselves) that Syriza is seen to have been pushed into a corner, left with no choice, rather than to have been enthusiastic in any break away from the common currency.

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Either the Troika Has No Hand, Or I’m No Game Theorist

A notable quote (h/t Tom Hickey at Mike Norman Economics):

Germany’s Mr Gabriel said any debt relief for Greece is out of the question at this stage since it would cause a collapse of discipline across the eurozone, triggering copycat demands from other countries in distress. “It would blow up the euro,” he said.

I am no game theorist, but to me Mr Gabriel’s statement underscores that if Syriza holds firm, Greece will ultimately win one way or the other …

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Government Spending or Lending Logically Precedes Tax Revenue

In a previous post, it was explained that enforcement of taxes (or some other financial obligation to the state) is fundamental to the viability of a national currency. Without such an obligation, widespread acceptance of the currency would not be assured. The currency might cease to serve as an effective mechanism for public provision of adequate infrastructure, education, health care, social security and much more.

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Balancing the Budget Over the Cycle

It seems to me that those, including New Keynesians, who support the maintenance of a “balanced budget over the cycle” are either not recognizing or rejecting a number of points made by heterodox Keynesian (or Kaleckian) critics of such a policy approach, including proponents of Modern Monetary Theory (MMT) as well as many other Post Keynesian and Sraffian economists.

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