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Cuchulainn
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Re: Everything You Always Wanted To Know About Marxism But Were Afraid To Ask Jeremy Corbyn

June 27th, 2017, 9:00 pm

ppauper wrote:
outrun wrote:
trump's objective reality

??

you misquoted by adding an apostrophe. He actually said "Marx is like any religion -- self-serving myth that trumps objective reality. "

LOL It's a verb, not a noun.
If you said "Trump's objective reality" then it is also OK.
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Traden4Alpha
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Re: Everything You Always Wanted To Know About Marxism But Were Afraid To Ask Jeremy Corbyn

June 28th, 2017, 12:10 am

jaw wrote:
Traden4Alpha wrote:
jaw wrote:
Weimar Germany, hallelujah! I am surprised you didn't throw in Zimbabwe for good measure. I would love to read your account of exactly what happened in Weimar Germany and how that is relevant to the UK's current economic situation and the question of how to fund the NHS.

And what do you think printing money will do to inflation and interest rates?  Of course, maybe violently popping London's real estate bubble would be a good thing for convincing rich speculators to dump their holdings -- who cares how it affects everyone else.

I am more than happy to give you an elaborate answer to that question, with hopefully a lot of concrete falsifiable statements in it for you to disagree with and prove me wrong ... after I have read your answer to my question about Weimar Germany, so that I can get a feel for the level of detail and quality of argument you're after.
The specifics of Weimar Germany are not especially relevant. It's just one of many examples of hyperinflation (see also Venezuela, civil war America, twice in Hungary, etc.) that were induced by printing money. Your mention of Zimbabwe seems especially apt given that Corbyn is talking seizing the property of the rich to give to the poor.

Personally, I'm a bit of Keynesian in that occasional short-term deficits do help keep the wheels on the economy in a downturn or retool an economy for changing conditions. But I favor deficit spending on investments in assets (e.g., infrastructure, education, basic science, R&D, new venture formation) rather than deficit spending on consumption. Perpetual deficits, especially on consumption, are a recipe for a shrinking real economy even if the amount of currency in circulation grows without bounds.
 
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Cuchulainn
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Re: Everything You Always Wanted To Know About Marxism But Were Afraid To Ask Jeremy Corbyn

June 28th, 2017, 8:57 am

Traden4Alpha wrote:
jaw wrote:
Traden4Alpha wrote:
And what do you think printing money will do to inflation and interest rates?  Of course, maybe violently popping London's real estate bubble would be a good thing for convincing rich speculators to dump their holdings -- who cares how it affects everyone else.

I am more than happy to give you an elaborate answer to that question, with hopefully a lot of concrete falsifiable statements in it for you to disagree with and prove me wrong ... after I have read your answer to my question about Weimar Germany, so that I can get a feel for the level of detail and quality of argument you're after.

The specifics of Weimar Germany are not especially relevant.  It's just one of many examples of hyperinflation (see also Venezuela, civil war America, twice in Hungary, etc.) that were induced by printing money.  Your mention of Zimbabwe seems especially apt given that Corbyn is talking seizing the property of the rich to give to the poor.

Personally, I'm a bit of Keynesian in that occasional short-term deficits do help keep the wheels on the economy in a downturn or retool an economy for changing conditions.  But I favor deficit spending on investments in assets (e.g., infrastructure, education, basic science, R&D, new venture formation) rather than deficit spending on consumption.  Perpetual deficits, especially on consumption, are a recipe for a shrinking real economy even if the amount of currency in circulation grows without bounds.

So, you believe in socialised debt. 
It's a contradiction; the invisible hand suddenly becomes visible. It's either one or the other, or am I missing something?
Last edited by Cuchulainn on June 28th, 2017, 9:35 am
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jaw
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Re: Everything You Always Wanted To Know About Marxism But Were Afraid To Ask Jeremy Corbyn

June 28th, 2017, 9:16 am

Traden4Alpha wrote:
jaw wrote:
Traden4Alpha wrote:
And what do you think printing money will do to inflation and interest rates?  Of course, maybe violently popping London's real estate bubble would be a good thing for convincing rich speculators to dump their holdings -- who cares how it affects everyone else.

I am more than happy to give you an elaborate answer to that question, with hopefully a lot of concrete falsifiable statements in it for you to disagree with and prove me wrong ... after I have read your answer to my question about Weimar Germany, so that I can get a feel for the level of detail and quality of argument you're after.

The specifics of Weimar Germany are not especially relevant.  It's just one of many examples of hyperinflation (see also Venezuela, civil war America, twice in Hungary, etc.) that were induced by printing money.  Your mention of Zimbabwe seems especially apt given that Corbyn is talking seizing the property of the rich to give to the poor.

Personally, I'm a bit of Keynesian in that occasional short-term deficits do help keep the wheels on the economy in a downturn or retool an economy for changing conditions.  But I favor deficit spending on investments in assets (e.g., infrastructure, education, basic science, R&D, new venture formation) rather than deficit spending on consumption.  Perpetual deficits, especially on consumption, are a recipe for a shrinking real economy even if the amount of currency in circulation grows without bounds.

The specifics of Weimar Germany are highly relevant, because if all one retains from what happened there is "printing money => (hyper) inflation", then one hasn't retained very much of practical use. (https://en.wikipedia.org/wiki/Hyperinfl ... r_Republic) After WW1, Germany had rather large reparation payments to make in foreign currency. Germany made those payments by selling mark for foreign currency, putting downward pressure on its exchange rate, forcing it to sell even more marks. This lead to mark depreciation and inflation in Germany. At some point, after Germany missed a payment, French and Belgian troops occupied the Ruhr, the German industrial heartland, in an attempt to extract reparations in goods. The workers in the Ruhr went on strike but the German government kept on printing marks to pay them.


So, what we have here is a government printing money with wild abandon and pumping it in the economy without putting it to any productive use whatsoever. At the same time, the production capacity of the economy is significantly reduced, yet aggregate demand stays the same, leading to excess aggregate demand relative to the economy's capacity to produce. End result of all of this: hyperinflation. Maybe I am missing something, but how this relates to the present-day UK is beyond me. As far as I am aware, the UK's foreign debt is insignificant to non-existent. Also, last time I looked, there were no foreign troops occupying the UK's factories.


What I am suggesting is that the UK is an advanced, developed country, with enough idle resources to organise a decent health service. All the government has to do is print some money to mobilise these resources for the benefit of said health service. As long as no capacity constraints are hit, this money printing will not lead to inflation. Now, I'll freely admit to knowing next to nothing about the NHS's problems, nor about the real resources available in the UK to alleviate these problems. So I may be totally wrong on that one. However, Jeremy Corbyn seems to think he needs the financial resources of the rich to fund the NHS. He doesn't. He can always print the money. What he does need is the real resources of the UK.


There are a few implications for Brexit here though. It appears Brexit might lead to serious personnel shortages in the NHS. This is a problem, as it is a real constraint, not a financial one. Also, whatever the size of the Brexit divorce bill, the UK should insist on paying in GBP only, not in EUR.
 
jaw
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Re: Everything You Always Wanted To Know About Marxism But Were Afraid To Ask Jeremy Corbyn

June 28th, 2017, 9:41 am

ppauper wrote:
I was thinking the UK in the 1970s, or even the US under LBJ/Nixon when we had "guns and butter." Nixon got Arthur Burns, the fed chair, to gun the money supply.
What's going on in venezuela is a good example as well.

The problem with printing money is it causes inflation. The standard response is to blame the inflation on some greedy third party, say speculators or jews (or jewish speculators), and introduce wage and price controls to combat the inflation. That invariably leads to shortages of essential goods (and sometimes rationing), and strikes by disgruntled workers, but again, you can blame the shortages on a greedy third party, say speculators or jews (or jewish speculators)

1. An explanation of the relevant economic mechanisms at work in your examples and how they relate to present-day UK or Europe would be massively useful here.
2. Printing money alone does not necessarily cause inflation. What causes inflation is aggregate demand (i.e. demand from the private and public sector combined) in excess of the economy's capacity to produce.
3. The standard response by whom? Not by me in any case. Also, it would be nice if we could have a discussion about economics without dragging the Jewish people into it.
 
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ppauper
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Re: Everything You Always Wanted To Know About Marxism But Were Afraid To Ask Jeremy Corbyn

June 28th, 2017, 12:03 pm

jaw: first, just so we can all be clear exactly what you are proposing, please can you provide actual numbers.
How much is to be spent, how much of that is to be funded by taxation, how much is to  be funded by debt, and how much is to be funded by simply printing money.
Please provide concrete examples of where and when what you propose has been used in the past and what the results have been.
Unless and until you specify exactly what you're proposing, no one here can fully critique it.

you might also try reading what I wrote:
ppauper wrote:
The standard response is to blame the inflation on some greedy third party, say speculators or jews (or jewish speculators), and introduce wage and price controls to combat the inflation.

to which you replied
jaw wrote:
3. The standard response by whom? Not by me in any case. Also, it would be nice if we could have a discussion about economics without dragging the Jewish people into it.

My statement is self-explanatory: whom do you think introduces wage and price controls? The same government that prints the money.
Of course not by you: how could you personally possibly introduce wage and price controls?

A recent example can be found in the socialist paradise known as venezuela

chavez blames currency speculators for inflation

Meat, Sugar Scarce in Venezuela Stores
President Hugo Chavez's administration blames the food supply problems on unscrupulous speculators, but industry officials say government price controls that strangle profits are responsible.


Chavez caused inflation, blamed speculators for it, introduced price controls to fight the inflation he caused, and then blamed speculators for the shortages caused by his price controls

as to point 2, everyone here is familiar with Friedman's famous remark from The Counter-Revolution in Monetary Theory (1970),
"Inflation is always and everywhere a monetary phenomenon in the sense that it is and can be produced only by a more rapid increase in the quantity of money than in output."
And a more rapid increase in the quantity of money than in output is exactly what happened in 1970s Britain and in Chavez's Venezuela
 
jaw
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Re: Everything You Always Wanted To Know About Marxism But Were Afraid To Ask Jeremy Corbyn

June 28th, 2017, 1:13 pm

Edit: @ppauper I sincerely apologize, the Weimar Germany example did not come from you, but someone else. My bad. Sorry once again.

@ppauper:

1. So I am supposed to give you precise numbers, yet you yourself refuse to given even a vague description of the economic mechanisms at work in the examples you provide? I went to the trouble of trying to explain to you what I think happened in Weimar Germany - a subject you brought into the discussion - and how it is not relevant to the UK today (btw. feel free to disagree with me on that one, but please provide concrete arguments). I get the distinct impression that you seem to expect me to do all the work here. Also, I have already confessed to being ignorant on the precise details of the problems facing the NHS, apart from a few scary headlines here and there. I therefore obviously don't have a detailed plan to solve these problems, nor do I know how much such a plan would cost. What I do know however, is that all of it can be funded by printing money. Taxation would only be necessary to reduce private sector demand if 1) aggregate demand becomes too big as evidenced by rising inflation and 2) society feels that real resources are better used to satisfy the requirements of the NHS than those of the private sector. If society sees things differently, i.e. feels that real resources are better used to satisfy the requirements of the private sector than those of the NHS, then obviously the plans for the NHS would have to be scaled back so as to leave room for private sector demand. I am agnostic as to which of the two options is the better one. There is no need for the UK government to ever issue debt to fund the plan.

2. I was under the distinct impression we were discussing present-day UK, a country that may have its problems (which country doesn't?), but at the end of the day still remains a developed, fully functioning modern democratic society, with a well-educated population and a good (?) infrastructure. I am sorry, but I don't see how bringing a dysfunctional country like Venezuela and a not entirely rational leader like Chavez into this discussion gets us anywhere. I believe the technical term for this is bottom fishing. I have no sympathy for the man, and I have no sympathy for his economic policies in so far as I know what they are. I am happy to agree that Venezuela has inflation problems, and that they were caused in large part by Hugo Chavez. But unless you can give some account of the economic mechanisms that caused the inflation and how they are relevant to a country like the UK today, I really don't see how this helps the discussion. (Edit: Based on past experience, my guess is that you can't or won't.)

3. Friedman's statement is obviously very imprecise and not correct in general. Firstly, what exactly does he mean by money supply? I believe there are hundreds of definitions of that. Secondly, let's consider and extreme case to show that his statement is not true in general. Take an economy with plenty of spare capacity in terms of labour and factories. Suppose the government prints money and gives it to consumers. Suppose further that all consumers decide to not spend any of this additional money but prefer to hide it all under their mattress instead. We would then have an increase in the money supply, no additional consumer demand, no increase in output, and no inflation (no producer would have an incentive to increase prices because he knows that his competitor has spare capacity and would grab his market share). Even if not all the newly printed money ends up under the mattress and there is some increase in demand from consumers, as long as there is sufficient spare capacity to meet that demand, there will be no inflation.
 
jaw
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Re: Everything You Always Wanted To Know About Marxism But Were Afraid To Ask Jeremy Corbyn

June 30th, 2017, 7:23 pm

@ppauper "Are you a Marxist?" is anything but a straightforward question and I fully understand why one would want to be extremely cautious when answering it. Marxist is a highly ambiguous and controversial label. According to Wikipedia (https://en.wikipedia.org/wiki/Marxism): "Marxism has since developed into different branches and schools of thought, and there is now no single definitive Marxist theory. Different Marxian schools ... might reach contradictory conclusions from each other.". As can be seen from the sidebar in one of the previous links, an outlet such as the Daily Telegraph, however, is more than happy to disambiguate for the benefit of its readers. Let us apply to yourself, purely for the sake of entertainment on a Friday evening, the line of reasoning applied by some to Jeremy Corbyn. You quote Milton Friedman in support of an argument you wish to make, so you probably think he is a good, maybe even a great economist. The economic policies of Pinochet in Chile were heavily influenced by the theories of Milton Friedman. Ergo, you must have a disposition towards overthrowing democratically elected governments whose policies you disagree with, as well as torturing and murdering your political opponents. This type of argument is clearly nonsense, and I myself do not believe for one second the conclusion is true, yet many seem to accept a similar logic when applied to someone who has been branded a Marxist.
 
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Re: Everything You Always Wanted To Know About Marxism But Were Afraid To Ask Jeremy Corbyn

July 21st, 2017, 7:17 pm

I thought Marxism is where everything is owned by the people ... but of course somebody has to take up the burden of administering everything for the people ... and to relieve these key administrators of distractions, they are given a few simple perks so they can keep focussed on serving the people ... perks like mansions, servants, chefs, chauffered limousines, private jets, hot and cold running starlets, ...
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