Andrew Marr Praises Steven Pinker’s Book on Science, Rationality and Free Markets

Mike has posted a number of pieces on his blog commenting on the right-wing bias displayed by Andrew Marr on his Sunday morning show. One recent example of this was his comment to a Tory guest, who came on immediately after he had given a hard interview to someone from the Labour Party. His interview of the Tory was softer, and at the end of it he leaned over to tell her that she had done ‘very well’. Or something like it.

I’m not surprised by this bias. Marr is a fan of the free market, the sacred ideology at the heart of Thatcherism, against which no-one is allowed to blaspheme or question. He was in the I newspaper a few weeks ago praising Steven Pinker’s new book, which argues that the world has got immensely better due to science, reason and markets. Pinker’s a neuroscientist and atheist polemicist. The book’s a successor to his previous work, The Better Angels of Our Nature. This was written to refute the claim that the 20th century was the bloodiest period in human history. This argument has been made in defence of religion, as much atheist polemic is based on the violence and bloodshed that has been generated by religion. But the 20th century is a problem, as the massacres and genocides there took place within an increasingly secular world, and in the case of the horrors committed by Communist regimes, were perpetrated by aggressively atheist regimes. And in the case of the Fascist regimes, it’s questionable how religious they were. General Franco in Spain believed that he was defending Christianity from secularism and materialism when he launched his attack on the Republican government, and horrifically many Christians did support the Fascist regimes against the supposed threats of Communism and Socialism. I’m well aware that Hitler claimed that he was doing ‘the Lord’s work’ in persecuting the Jews in Mein Kampf, but in his Table Talk he has nothing but contempt for Christianity, and wants astronomical observatories set up near schools as part of a scientific campaign against the religion. Hitler’s own religious beliefs seem to have been a kind of monistic pantheism, possibly not that far removed from those of the Monist League, who also sported the swastika as their symbol. As for Mussolini, the Italian dictated signed the Lateran Accords with the papacy, in which the Pope finally recognised Italy’s existence as a state in return for Roman Catholic religious education in schools. But il Duce had started out as a radical socialist, and many members of the Fascist party still were vehemently atheist. Much depended on the religious opinions of the local Fascist ras whether Roman Catholic religious education was taught in the schools in his area. I don’t wish to go into this argument now, whether these regimes were really atheist or not, or if the 20th century really was the bloodiest period in human history. I just wish to make the point that this was the issue at the heart of Pinker’s previous book.

Pinker’s new book apparently tells us that everything’s getting better, including the environment, and Pinker marshals an impressive arrays of facts. But all this said to me was that people and governments have become more ecologically conscious. It does not mean that we aren’t facing the devastating loss of an extraordinary number of this planet’s animal and plant species, or that we face catastrophic global warming which may make the Middle East uninhabitable.

But even more questionable is Pinker’s and Marr’s assertion that modern, post-Enlightenment society has been immensely improved thanks to the science, reason and markets. In the case of science and reason, at one level the statement is obviously true. Human life has benefited immensely from scientific advance, particularly in medicine. But the view that science and reason didn’t exist before then is one that many Medieval scholars would strenuously reject. In contrast to the stereotypes, the Middle Ages actually wasn’t anti-science. There are poems from the 12th-13th centuries celebrating it, and the new knowledge that was flooding into Europe from the Islamic world. The 15th century English poem, The Court of Sapience, lists the various branches of knowledge known to the medieval world, and celebrates them as the area of ‘Dame Sapience’, an idealised personification of wisdom. As for superstition and the occult, historians have also pointed out that the Middle Ages were also an age of scepticism as well as faith. Medieval theologians wrote texts arguing that visions of demons were more likely caused by a full stomach interfering with the correct functioning of the nerves, and so causing bad dreams. Others doubted whether the seers, who claimed to be able to identify thieves through peering in bowls of water or other reflecting surfaces, had any such powers, and were simply using common knowledge to put the blame on notorious thieves. And in contrast to what Marr apparently thinks, free market capitalism did not suddenly emerge in the 18th century with the French Physiocrats and then Adam Smith. In fact, some Christian theologians were arguing for free trade as far back as the thirteenth century.

As for free market capitalism benefiting humanity, the evidence today is that it really doesn’t. The neoliberalism ushered in by Thatcher and Reagan has done nothing but make the lives of the poor much poorer across the world, and in so doing has increased international tension and political violence. The Korean economist, Ha-Joon Chang in his book 23 Things They Don’t Tell You About Capitalism, shows how the strong economies of the world’s developed nations were all created, not by free trade, but by protectionism.

This is very clearly not something any true-blue Thatcherite wants to hear. But it also shows the strange, cult-like nature of the ideology of free trade capitalism. A number of writers have pointed out the apparently illogical, absolute belief its supporters have, even when they are shown the plentiful evidence to the contrary. They still go on believing and demanding free market solutions, even when it is abundantly clear to everyone else that not only do they not work, they are even causing immense harm. And Marr is clearly one of these true believers. He also seems to have uncritically accepted the view that science, reason and free market capitalism were all products of the Enlightenment, when academic historians have been pushing the origins of science and capitalism further back to the Middle Ages, and demonstrated that the Age of Faith was also one of Reason, however irrational it now seems to us.

Marr’s praise of the book and its promotion of the free market also gives more than an indication of his own political beliefs, and why he is much less sympathetic to left-wing guests on his show than those from the right. He’s another member of the cult of neoliberal market capitalism, and this has to be protected at all costs from unbelievers. Even when he and the Beeb swear impartiality.

How can we ensure that tax evaders and aggressive tax avoiders do not profit from taxpayer-funded public procurement contracts?

Published by Anonymous (not verified) on Wed, 28/02/2018 - 8:43pm in

Cross posted from the Fair Tax Mark:

Conservative MP for North Wiltshire, James Gray, recently asked Parliament what steps the UK Government was taking in its procurement policy to tackle aggressive tax avoidance by government suppliers.[1] A reasonable question: why should tax dodgers profit from contracts funded by taxpayers?

The answer from the Parliamentary Secretary at the Cabinet Office, Oliver Dowden, was convoluted, but seemingly positive. He said: “The 2015 Public Contract Regulations implemented the latest EU Public Procurement Directive, and require public bodies to exclude suppliers from a procurement where the supplier has been found guilty of breaching its obligations in relation to payment of taxes and this has been established by a judicial or administrative decision having final effect within the relevant jurisdiction.”

The reality is very different. The UK Government rarely, if ever, considers tax justice in its procurement in a meaningful way. This is in large part because the bar for disqualification is set insanely high. For example, disqualification is admissible where HMRC has successfully challenged a potential supplier under the General Anti-Abuse Rule (GAAR). But, to date, not a single GAAR penalty has been issued in the UK.

Another ground for exclusion is where a judicial or administrative decision has established that a business has been found guilty of breaching its tax obligations. But more often than not, disputes never reach such a conclusion. Instead, “settlements” are reached outside of the courts, as happened with Google, which in 2016 agreed a deal with British tax authorities to pay £130m in back taxes in connection with a decade of underpayment. Again we have an exclusion criterion that is highly unlikely to ever be enacted.

And unfortunately, the same factors are at play in local government procurement – not just in the UK but right across Europe. Which is an enormous missed opportunity given over 250,000 public authorities in the EU spend around 14% of GDP on the purchase of services, works and supplies – a colossal €1.9 trillion.[2]

But action is stirring and change may be afoot. In Spain, 37 municipalities have publicly committed to not work with companies that operate in tax havens – this includes the major cities of Madrid, Barcelona, Seville and Zaragoza.[3] The Danish municipalities of Copenhagen and Albertslund are actively looking to develop a means to identify tax evaders and companies exploiting tax havens.[4] And in Finland[5], the cities of Helsinki and Malmo are seeking to change their procurement and reward suppliers that embrace public country-by-country reporting, with work similarly being progressed by tax justice advocates in Slovenia and Latvia.

In the UK, the desire to take action at a local level is at least as concrete and wide-ranging, as evidenced in 2016, when the Fair Tax Mark[6] and Christian Aid[7] urged local councils to take action. They responded up and down the country. Everywhere from Manchester City Council to Durham County Council and the London boroughs of Southwark and Lewisham. But the new national Public Procurement Note[8] that emerged (which takes the form of revised standard Selection Questionnaire), while being a step forward, suffers from the same weak exclusion grounds that operate nationally, and relies on suppliers to self-declare compliance.

Progress has to date been slow due a number of factors. Firstly – arguably – the EU Procurement Directive constrains action as it requires that exclusion criteria must be linked to the quality of the goods and services involved. There is therefore a perception that progress on the issue of tax evasion and avoidance maybe too difficult to secure and is therefore best left alone. Secondly, there is no database of proven tax evaders for procurement officers to refer to – either in the UK or across Europe.

This isn’t to say that progress is impossible – far from it. The fantastic success of the Fairtrade Towns movement serves as an example and inspiration: there are now over 2,000 Fairtrade towns in 30 countries across the globe, and over 630 in the UK alone.[9] The Fair Tax Mark is looking at how it might build a similar network of Fair Tax towns and cities. This will involve working with bold local councils across the UK and with tax justice campaigners across Europe to explore what progress can be made within existing and amended EU law. The European Parliament signalled its opinion at the end of 2017, when it called on the Commission to put forward a revision of the Procurement Directive which includes measures to prevent public administrations from working with companies that use tax havens.[10]

It will also involve exploring what further measures can be pursued in the UK post-Brexit, as we are doing later this month at the Social Value Summit.[11] Could, for example, the Withdrawal Bill be amended to incorporate enhanced provisions for social value in procurement, with goods and works being newly encompassed (in addition to services) and factors such as ‘aggressive tax avoidance’ being more central to selection and award criteria – as argued separately by both the Society of Conservative Lawyers and the Society of Labour Lawyers.[12]

If like us, you think that public procurement could and should be deployed to punish tax dodgers and reward fair tax payers, then please get in touch. We’ll be shaping our plans over the coming months with a view to announcing provisional action in the summer.

Paul Monaghan, Chief Executive, Fair Tax Mark


[2] &











Corbyn needs to make the case for the private sector because that makes it easier to make the case for the state

Published by Anonymous (not verified) on Wed, 28/02/2018 - 6:32pm in



A commentator on this blog yesterday suggested that:

Corbyn’s the best leader we’ve had in a long time and if we all got behind him we could completely transform this country.

That is a contentious claim. But it made me think. As a result I re-read the introduction to my 2011 book, The Courageous State. There I argued that:

As I argue in this book, we could have a Courageous State. A Courageous State is populated by politicians who believe in government. They believe in the power of the office they hold. They believe that office exists for the sake of the public good. They know what that public good is. They think it is their job to help each and every person in their country to achieve their potential – something that is unique to each person and which at the same time is a characteristic we all have in common. And they believe they can command the resources to fulfil this task – whether through tax or other means – and that they should command those resources so that we as a country can each achieve, both individually and collectively.

We have not had politicians like that for a long time. These are politicians with the courage to work out when the market is absolutely the right mechanism for delivering what society needs – and which backs those who wish to partake in that market openly, honestly and accountably by providing them with the environment they need so that they can flourish, while delivering all the resources required to curtail those intent on market abuse.

And they are politicians who are as capable of deciding when the market can never deliver – because it is wholly unsuitable for the task in hand – meaning that it is the job of the state to ensure that what society needs and wants society shall get, at the lowest possible cost for the highest possible outcome for the benefit of all involved.

These are politicians of integrity. Who will carry their conviction with pride. Who will stand up to those who get in their way, not by ignoring them and not by bullying them but by presenting them with reasoned argument that shows that these politicians have worked out what they are doing, and why, and how they mean to achieve it.

I suspect a great many of us want such politicians. Politicians who are strong and effective; people we can believe in and who inspire but who we know we can hold to account through the democratic process. Politicians we can hold up as examples. Politicians with the ability to admit mistakes and move on. Politicians who we are willing to follow. Politicians of the stature of those who built the post-war consensus in the UK, for example, which proves that such people can exist.

I stress: those are not my sole criteria. My focus was in the economy. The environment, equality and other issues are addressed elsewhere. They are then necessary but not sufficient conditions to identify the leadership we need, in my opinion.

Does Corbyn meet those criteria? I wish he did. I have to say I am not convinced. There is too much ambiguity as yet for it to be said that he does. And on principles I do not think there is a need for ambiguity, even (and perhaps especially) when in opposition.

I do not dispute Corbyn has merit. I shared platforms with him because he did so. But has he the clarity of thinking to lead real transformation of our economy? Not yet, I suggest, and not least because he has not yet made the case for the private sector which is the necessary corollary of that for the state.  At least I have not seen it.

Do that, and the lines are drawn in a way that make it harder for opponents to attack. That’s why this is important.

Is post-growth capitalism possible?

Published by Anonymous (not verified) on Tue, 27/02/2018 - 9:33pm in



There is an article on The Conversation (a web site reserved for comment by academics) Today that discusses the possibility of post-growth capitalism. Written by Adam Barrett , a multi-disciplinary researcher at Sussex University, it is based on macroeconomic modelling based on Minskian theory. As he notes:

[Minsky] argued that financial crises are to be expected in capitalist systems because periods of economic prosperity encourage borrowers and lenders to be progressively more reckless. Minsky’s work was rather overlooked prior to the 2008 crash, but has received increased attention since.

To test the hypothesis that capitalism might survive in a post-growth model he notes:

The model included a banking sector that charges businesses interest on loans. That way, it could address the concern that this key feature of capitalism might in itself create a need for growth. (While other aspects of finance could be reformed for a post-growth economy, it is hard to imagine a capitalism without debt and interest.) The model also included a basic labour market, with dynamic wages.

I stress, I have not read any more on his work, but he concludes:

There are of course reforms that would have to be made to the global financial system. I found that an end to growth reduces profits for business owners. Therefore, if it remains relatively easy for money to flow across borders, then investors might abandon a post-growth country for a fast-growing developing country. Also, businesses are beholden to shareholders keen on growth as a means to rapid profit accumulation.

And adds:

It may be that environmentalists trying to protect the Earth’s resources do not have the power themselves to curb the excesses of capitalism. However, growth has slowed in advanced countries, and some mainstream commentators and economists are now predicting a transition to a post-growth era, whatever our environmental policy – which means the study of post-growth economics is a field which itself will grow.

Instinctively I agree with the findings. I cannot see why very low interest rates and so banking as we know it, could not survive in a post-growth economy. But, I stress the essential condition of low rates. The old ‘normal’ was the aberration.

I can also see no reason why the profit motive cannot survive. Indeed, I cannot see how it in its genuine, return to entrepreneurial activity, form it could be suppressed without considerable harm to human rights and society at large.

What I think the model really suggests is that what is required is a control on rent seeking. After all, that is what most of the return that is now called profit really is. It is actually rent extracted from land, resources, the exploitation of people, the abuse of power, the arbitrage of regualtion including that on tax, and so much more that is antisocial and harmful to society at large. What I suspect the model suggested is that in a post growth world such abuses have to be curtailed but that there may be a potential first mover cost to those who taking first steps to challenge that abuse.

Should that stop such moves? Clearly not. But that is, for example, not what anyone in politics will say to justify their leaving the EU, if that is their motive. I also happen to think such moves will, of course, work best cooperatively, and so by staying in the EU. I also happen to think such organisations now offer the best way to deliver such change because they now seem vastly more responsive to change than once they were (but it’s been a painful progression, a characteritistic that will remain, no doubt as old style rentier capital fights back, as it is in Brexit campaigns).

In that case the debate is completely worthwile. As is the research. For that reason the linked article is worth reading.

Why the next oil boom will be fueled by blockchain

Published by Anonymous (not verified) on Tue, 27/02/2018 - 8:54am in



According to a report from the World Economic Forum from 2017, a digital transformation has already swept across the energy industry.

The biggest trouble with modern​ macroeconomics

Published by Anonymous (not verified) on Mon, 26/02/2018 - 7:07pm in



The trouble is not so much that macroeconomists say things that are inconsistent with the facts. The real trouble is that other economists do not care that the macroeconomists do not care about the facts. An indifferent tolerance of obvious error is even more corrosive to science than committed advocacy of error. Paul Romer  New-Classical-Real-Business-Cycles-DSGE-New-Keynesian microfounded […]

The role of public sector borrowing

Published by Anonymous (not verified) on Mon, 26/02/2018 - 5:41pm in



This post by was originally published on the web site of the Progressive Economics Group. The Group is involved in policy development on the assumption that a future government might abandon the dedication to neoliberal economics of those in recent decades. I recommend it as a source of wider reading.

Policy Issue

It has long been assumed that government spending is financed by taxation. This should be challenged, because it is not true. A clear understanding of the mechanisms for funding public expenditure is essential to implementing a sound fiscal policy. The question to be asked is this:

What is the appropriate and effective mechanism for funding public expenditure?


It is now widely agreed that government spending might be funded in three ways. The first method of funding public expenditure is to increase the supply of  government created money in the economy. This increase in the supply of government-created money happens every time the government spends. When the government spends it makes a commitment, or promise to pay, and this is accurately reflected in the fact that every banknote in the UK includes a printed version of that promise.

There is, however, a problem with money printing. Unless it is properly controlled it can lead to inflation. All inflation is not bad; on the contrary some inflation is useful. Over recent years we have seen the strenuous efforts made by central banks to avoid deflation. Deflation can have recessionary consequences. The Bank of England sets 2% per annum as its inflation target consistent will sustainable growth. The policy challenge is to permit the injection of just enough money to achieve this goal, taking other factors into account.

Broadly speaking, the way to do this is by taxing most of the money a government  creates through its spending out of existence soon after that spending takes place. Tax fulfils two goals in this process. First, it controls inflation, and this role is now seen by many as the primary purpose of taxation. Second, in effect the government endorses the value of its own currency by requiring that tax be paid making use of that money it creates.

However, to ensure that happens, spending that delivers public services must  takes place before tax can be charged. Unless this were the case the money to make tax payment by households and businesses would not exist. By accepting its own currency in settlement of tax obligations the government fulfils its “promise to pay”. This circuit, in which a government creates money to fund expenditure that is returned as tax payments  is the concrete way in which the government creates, delivers and maintains a stable currency for use in trade.

A growing economy requires general price increases, or inflation. Except under unusual circumstances, a general increase in prices requires an increasing money supply. A fiscal deficit is the only way in which money can be injected into an economy continuously.   It follows that governments must run a near perpetual deficit or face the risk of creating a liquidity crisis due to a shortage in the money supply, which would then create a risk of deflation.

The question then arises as to how this deficit should be funded in a fiat monetary system; that is, a monetary system in which money itself lacks value (in contrast to a system in which gold was convertible into money). ‘Fiat’ in this context means that the money in an economy is only backed by the government's promise to pay and has no other convertible value except for the payment of tax.

There are, in essence, three ways in which a government can fund a deficit. The first and most obvious of these would be for the government run an overdraft with its central bank, which is the Bank of England in the case of the UK. There would be no reason for  interest to be paid on this overdraft if the government owns the central bank, as is the  case in the UK, because paying interest to oneself is merely an accounting exercise.

Historically a central bank offering a government an apparently unlimited overdraft was considered profoundly imprudent. That was because until 1971, when the USA came off the gold standard, all currencies were ultimately restricted in their availability by the conversion requirement into gold under what came to be called the Bretton Woods System. The ability of the government to print money without constraint, which a central bank overdraft for its government implied, threatened monetary stability as a consequence. As a result the government's deficit was in effect repackaged in the form of bonds (or gilts). These interest bearing bonds were sold by the government to third- parties. In this way the gilts market was created.

What that market effectively ensured until 1971 was that the government must use money already in existence for its spending. When the amount of money was fixed to existence  of gold this was an appropriate goal. Since the link with gold has been removed the constraint imposed by having to borrow makes no sense: there is no limit, subject to inflation objectives, to the amount of money that might usefully exist.

That said, although the gilts market is, in theory, now entirely unnecessary for the purposes of funding government deficits it has turned out that in practice there are significant, and overall beneficial, uses for government created bonds. The most obvious is as a place of guaranteed safe deposit for those with funds they wish to save. A government can never default on a bond that it issues in its own currency because it can always instruct its central bank to create the money required to make repayment of a  bond when redemption is due. As a consequence the owners of gilts have an absolute guarantee that their funds are safe. This is fundamental to the financial security of an economy.

That said, this means that government bonds are an asset with very low inherent risk. As  a consequence, gilts have the lowest interest rate paid in any market. Despite this they  still have great appeal to pension fund trustees and insurance companies, both of which have an obligation to settle liabilities far into the future.

Gilts also appeal to those who wish to deposit extremely large amounts for short periods of time. Very large amounts cannot receive the guarantee that the government gives normal bank depositors. In particular, companies seeking to place millions and even billions of pounds on deposit overnight seek security for their cash. They achieve this security not by placing the funds in bank accounts, but by temporarily purchasing government bonds from banks. These they then sell back the bonds the following morning at a very marginally higher price to cover the interest earned. This is called the ‘repo’ market.

As a practical matter it would be very difficult if not impossible to replace gilts in the pension, insurance and banking sectors with a private sector security instrument. As a consequence there is a systemic need to issue gilts. However, the idea that the  government is dependent upon doing so to raise funds is a legacy of the pre-1971 monetary era. It is no longer true. Gilts are now issued as a favour to the financial  markets to provide a safe deposit service to the market that it needs. They are not issued  to fund government expenditure, because they are not needed for this purpose. This is precisely why real interest rates on gilts have shown a markedly downward trend over time, and they now carry an effective near zero interest rate.

Unfortunately international regulation has not recognised this fact. As a result the EU still bans central bank lending to the governments that own them, reflecting thinking from the pre-1971 system. This ban is, however, now worked round using the technique known as quantitative easing (QE). QE occurs when a central bank (or one of its subsidiary companies) purchases gilts issued by the government that owns it. The Bank pays for these gilts by crediting the account of the seller of those gilts (for example, a pension fund) with an amount equal to the value of the bonds purchased. The money for this transaction is not provided by taxpayers. It is instead created out of thin air by the Bank of England lending it to one of its own subsidiaries to buy the gilts in question, in exactly the same way as all bank loans are created by the use of double entry book- keeping.

The result is that the ownership of a government owed debt is transferred to a government-owned bank. In effect the government has then lent itself money. This self- lending is strictly equivalent to printing currency, and more practical for the large sums involved in the QE process. Whether the loans involved then have interest paid on them  is of no importance, since the interest payment cancels itself out (appearing in the national accounts as an expenditure from the government to the central bank, and an income from the central bank to the government). QE does then permit a central bank to provide its government with a long-term interest free loan that also has no set repayment date. This no interest, infinite maturity date loan provides a funding mechanism for government expenditure that is an alternative to taxation.

In formal terms this is expressed as follows:

G is government spending
T is tax revenue
t  is the time period (for example 2018)
∆B  = B(t) – B(t-1) is the change in the level of government borrowing
∆M = M(t) – Mt-1) is the change in the level of government created money in a period (most of which, will be QE)

These produce the following identity, which is true by definition:

G = T + ∆B + ∆M

In words, government spending must equal taxation plus the change in government borrowing plus the change in government created money.

The policy implications are clear. The perennial question of ‘how is it going to be paid for’ is answered by this equation. All government spending is initially paid for  by creating new money. The new money provides the means to either collect additional tax revenue, or to fund new gilt issues. If there was a risk of deflation and neither tax increases or bond issued were desirable, then this identity makes clear that a government can alternatively create and repurchase its own debt to fund its spending.  At  an aggregate level the government can adjust the elements of the identity to foster full employment, subject to inflationary pressure. As such it is this equation that is at the core of managing the macroeconomy.

Policy Framework

The lesson in all of these instances is that a sustainable stimulus policy must not only attend to demand and interest rates, but also to the relation of real wages to productivity. It is not a matter of wage-led vs. profit-led dynamics as putative opposites, but rather of the sequential link between the two. “The engine which drives Enterprise is … Profit” (Keynes).

The spending-funding identity explained in this briefing makes clear that governments, and not markets, are the drivers of the decision-making on the level of taxation, borrowing, interest rates and the optimal balance between the these factors. That optimal balance is the value of each that is consistent with the government's policy goals. If, for example, the government seeks to achieve full employment, then what this approach suggests is that it is at complete liberty to do so without market interference.

So long as there is spare capacity within the economy that needs to be usefully employed the government can create new funding to achieve that goal. Should the increase in demand generate undesired inflation, the government can either cancel the additional spending by greater taxation or by selling its bonds in the financial market (which transfers private liquidity to the government).

A government with its own currency can, if it chooses, take command of their own financing and as a consequence of the national economy, and it is not beholden to the financial markets.

Richard Murphy is Professor of Practice in International Political Economy at City University, London and Director of Tax Research UK. He is a non-executive director of Cambridge Econometrics.

This policy brief may be downloaded here as a pdf

Keynes — en sällsynt fågel

Published by Anonymous (not verified) on Mon, 26/02/2018 - 4:04am in



Alfred Marshall skrev en gång att “bra ekonomer är sällsynta fåglar.” Det stämmer verkligen. En av dessa sällsynta fåglar var definitivt John Maynard Keynes. Och nu har den norske ekonomiprofessorn Björn-Ivar Davidsen skrivit en bok om denne sällsynt kompetente ekonom, filosof, statstjänsteman, spekulant, utopist, universitetsmecenat, konstsamlare, med mera, med mera. I boken får vi följa […]

Chunky Mark on the Ex-MI6 Chief Richard Dearlove and the Resignation of Ian McNicol

Published by Anonymous (not verified) on Sun, 25/02/2018 - 9:38pm in

Here’s another great piece from Chunky Mark the Artist Taxi Driver, which he posted yesterday. He comments on the remarks in the Torygraph from the former head of MI6, Richard Dearlove. Dearlove was speaking about Jeremy Corbyn’s meeting with a Czech spy, and declared that the Labour leader ‘has questions to answer’. This is part of the continuing attempt to create a ‘Red Scare’ about the Labour party and its leader, comparable to the ‘Zinoviev Letter’ that lost Labour an election in the 1920. The Zinoviev letter was an MI5 forgery, and this is a complete non-story and Tory libel.

Mike’s pointed out that the spy in question was a diplomat. Corbyn met him, just as he met other diplomats and no secrets were passed on. The Czechs, and the academic in charge of their Secret Services library has said they have categorically no evidence that Corbyn ever worked for them, or passed on any secrets at all. And in the week Andrew Neill, who is the former editor of the Sunday Times and the Economist, told his viewers precisely what a load of rubbish it this story is on the Daily Politics.

Corbyn is threatening to sue for libel. Gavin Williamson, the Tory apparatchik who repeated in a Tweet, is trying to backtrack without giving Corbyn the apology or money to charity that he demanded.

But the bug-eyed slander-merchants of the Torygraph are still carrying on with it.

Chunky Mark makes the point that Dearlove himself is hardly reliable, because he was involved in the concoction of the ‘Dodgy Dossier’ that served to bring us into Blair’s illegal and murderous war in Iraq. And he’s repeating the libel that Corbyn handed secrets over to a Commie spy, simply because he hates and fears him.

He also comments on the resignation of Ian McNicol, the Labour Party chief, who presided over the massively unjust suspension and expulsion of tens of thousands of Labour members, because they had the audacity to vote for Corbyn rather than endorse the preferred Blairite Thatcherite entryists. Chunky Mark says that we shouldn’t celebrate his departure, because this is a man who poured his life and blood into the Labour party. Before going on to say precisely why we should. One of those he expelled was a trade unionist. She committed the terrible offence of saying that she ‘f***ing loved Dave Grohl’ in a post she put up about the Foo Fighters. This apparently brought her union and the Labour party into disrespect. Actually, considering the fruity language on the internet, I’m surprised anyone even noticed, let along took offence.

So McNicol’s walked, and hopefully we’ll get a better, fairer person in to do his job. Hopefully.

The redoubtable Tony Greenstein, anti-racist, anti-Fascist and very definitely not an anti-Semite, put up a post yesterday commenting on McNicol’s departure, with the restrained title ‘Rejoice – The Witch is Dead – Crooked McNicol Rides No More’. He gives further information on McNicol’s resignation. Apparently he was given his marching orders on Tuesday. Greenstein also points out that this is just the beginning of making the Labour party’s bureaucracy more just.

But this does give up to everyone libelled, smeared and unfairly expelled, simply for their opposition to the Blairites and their wretched neoliberalism.


Why MMT? A discussion with Warren Mosler

Published by Anonymous (not verified) on Sat, 24/02/2018 - 11:09pm in



A few weeks ago I mentioned on the blog that Warren Mosler had agreed to answer some questions on Modern Monetary Theory (MMT), of which school of thought he is one of the founders. Well over 200 questions came in as a result.

I tried to summarise these and have sent some to Warren now (the delay is all down to me: work has been rather more pressing this year than I anticipated when launching the invitation). This first Q & A is meant to be an overview of MMT. I am playing the role of sceptical enquirer: the questions I ask have to be viewed in that light. Warren has given short answers but has suggested he is open to answering responses.

R: What is MMT?

W: A description of monetary systems.

R: What does MMT say money is?

W: Today's currencies like the $, yen, euro, etc. are simply tax credits- the thing needed to pay taxes.

R: But it’s now widely though that banks make our money?

W: Bank loans create bank deposits, under charter, regulation, and supervision of the govt.

R: Can we trust them to do that?

W: Only to the extent you trust govt. regulation and supervision.

R: What, then  is the role of central bankers?

W: Setting the policy rates.

R: And what is the role government come to that? And how do we stop there being too much money?

W: Depends on the definition of 'money'.  I suspect it's more about too much spending? That can be addressed by cutting govt. spending or cutting private sector spending by various means including govt. spending cuts, tax increases, increased lending standards, etc. etc.

R: If tax is to stop inflation why do we get so worked up about it and what it does?

W: Tax increases will reduce aggregate demand and inflation to the extent the inflation is being caused by excess demand. If that's not the cause- and it generally isn't- there are other tools for addressing price increases from those other sources. And it seems people dislike inflation more than they dislike unemployment?

R: It’s widely thought that  interest rates are meant to be used  stop inflation? What does interest do if tax stops inflation? Is there a good rate of inflation?

W: Not that I know of.  There can be a good economy in the context of both low and high rates of inflation.

R: What does full employment really mean?

W: For me the best we can do is offer a transition job to anyone willing and able to work to both promote the transition from unemployment to private  sector employment, and to act as a more effective buffer stock for the price level than unemployment. At that point we are continuously at a form of full employment.

R: What is the Jobs Guarantee?

W: Another name for the above described transition job.

R: Isn’t that the same as `Universal Basic Income?

W: No, with the transition job you have to at least 'sell your time' to get paid.

R: But  isn’t that just a money hand out?

W: As above. The value of the currency is a function of what you have  to do to get it from the govt.  It's a simple case of  monopoly pricing.

R: Surely what you’re really saying is we’re just going to pile debt on debt at cost to future generations?

W: The public debt is the amount spent by the government .that has not yet been used to pay taxes, and remains outstanding until used to pay taxes in the form of cash, reserves, and  securities. Treasury securities are nothing more than time deposits of the currency at the central bank.

R: If we don’t need debt do we need money markets?

W: Not for public debt or interbank lending.

R: But aren’t you ignoring the international dimension here?

W: No.

R: You say we don’t need debt but we need the rest of the world. Won’t they just trash our currency instead?

W: What does that mean? Exports are real costs, imports real benefits. Real wealth is about optimizing  real terms of trade.  Currency fluctuations per se don't alter real wealth.

R: I’m still not convinced. What about the Weimar Republic, Zimbabwe and even Venezuela. Money printing didn’t work so well there, did it?

W: There problems varied. Weimar was about deficit spending for war reparations of approximately 5% of GDP per month and a massive loss of productive capacity. Zimbabwe lost it's productive capacity, kept govt. spending as before, and the banking system was an open channel for corruption.

R: And what happens to countries that don’t have their own currencies? What does MMT say about them?

W: They are disadvantaged.

R: what about countries who cannot borrow in their own currencies, as many cannot?

W: Example?

R: Given all this, is MMT just some special case with no real use or does it really change the way we should think about the world of economics?

W: It's the general case and will change how you think only if you don't already understand  MMT.

R: Convince me: what would a world where the economy was managed as MMT suggests look like? Could I spot the difference, and how?

W: A form of continuous full employment is the likely outcome of understanding the monetary system.

Comments welcome.