YouTube has the video Global Capitalism: The Challenge of China [July 2021].

In this month’s lecture, Prof. Wolff will discuss the following:
1. China’s Economic Growth since its Revolution (1949)
2. China’s Economic “Model” and the Global Economy
3. China, Capitalism, and Socialism
4. China versus the US: Options versus Threats

A very good presentation by Richard Wolff. Lately I have been feeling that I have learned everything from him that I am going to learn from him, but this was an excellent presentation that rounds out everything that people think Richard Wolff has been pushing. It presents a picture of a better way we can interact with China than we seem to be heading in the last administration and the current one.

James K. Galbraith has published a very eye-opening article Dismal Economics. I was almost discouraged from signing up for a free subscription that allowed me to see a couple of articles a month on Project Syndicate. Here is the introduction.

Although neoclassical economics relies on assumptions that should have been discarded long ago, it remains the mainstream orthodoxy. Three recent books, and one older one, help to show why its staying power should be regarded as a scandal.

He then goes on to review 4 books. There are so many revelations in this article, that I cannot quote them all. One of the first ones I came to is:

It was this latter group that shifted the discipline’s focus from social classes (landlords, capitalists, workers) to individual units (households, firms) and declared that these units interacted to maximize not “surplus” but “utility” and efficiency. The marginalists also introduced a “sophisticated” mathematical technique to the field: namely, the differential calculus, with which one can show that maximum efficiency is reached when firms are small and competitive, as this tends to reduce profits to zero.

He then goes on to criticize some of what I have always considered to be bêtes noires of Economics, but even criticizes some of my idols. The critique of my idols has opened my eyes to things about them that I have missed noticing before.

I am going to have to decide which of these books to read first,

Mason Gaffney and Fred Harrison, The Corruption of Economics, Shepheard-Walwyn Publishers Ltd., 2006 (first published 1994).
Stephen A. Marglin, Raising Keynes: A Twenty-First-Century General Theory, Harvard University Press, 2021.
Alessandro Roncaglia, The Age of Fragmentation: A History of Contemporary Economic Thought, Cambridge University Press, 2019.
Robert Skidelsky, What’s Wrong with Economics?: A Primer for the Perplexed, Yale University Press, 2020.

The socialist programs pay for things that do not make money by themselves, but they build the infrastructure that the capitalism in our society needs to grow the economy. One benefit of socialism is that it provides what the economy needs despite the fact that no single private company can make a profit from these activities.

China’s economy is growing so fast not because they are cheating. It’s just that China is making the investments that the USA refuses to make. China is industrializing while the USA de-industrializes. What actually wise capitalist thinks that our de-insdustrialization is good for the society as a whole? They all know that it is the most profitable path for individual companies in the short term. In the long term, after all value has been sucked out of USA companies, there will only be a tiny, shrunken USA economy.

What the USA is doing has been likened to killing the goose that lays the golden eggs.

For anybody who thinks they read in the above paragraphs any support for the lack of democracy in China, the truth is that what you think you read is a fantasy of your own mind. Just because I support investing in infrastructure like China does, in no way means I support everything else that China does. Don’t let your hot head make you see things in my post that are not there.

I can actually tell the difference between what I like, and what I don’t like. I wish more people had that ability.

Bernie Sanders explained the purpose of his reconciliation efforts.

In the midst of the many long-ignored crises that our budget reconciliation bill is attempting to address, let’s be completely honest: we will not have one Republican senator voting for it. Tragically, many Republican leaders in Congress and around the country are just too busy continuing to lie about the 2020 presidential election, undermining democracy by suppressing voting rights, denying the reality of climate change, and casting doubts about the efficacy of the Covid-19 vaccines. That is their focus at this moment.

That means that the 50 Democrats in the US Senate, plus the vice-president, will have to pass this most consequential piece of legislation alone. And that’s what we will do. The future of working families is at stake. The future of our democracy is at stake. The future of our planet is at stake. That is my focus at this moment.

Now is the time.

This effort will take the inflation pressure off of our current path. The Federal Reserve is pumping trillions of dollars into the economy in a futile effort to prevent a stock market and economic crash. The money is mostly going to the rich who boost stock prices by insisting corporations buy back their shares. None of this increases the productive capacity of our economy. If we were to shift that money creation intro investments in the productive capacity of the economy, then the economy would actually grow with the money pumped in.. With the current policy, the economy is shrinking while the money gets pumped in.. This is what leads to inflation.

Are we going to stand for Democrats not backing Bernie on this? How could any consideration be more important than this?

The Yahoo News article Bipartisan infrastructure plan: ‘If this is a take it or leave it…I’m going to leave it,’ Rep. DeFazio says has prompted this post.

Pretty good interview with Rep. DeFazio He and other Democrats still haven’t come up with a good answer on inflation. This was better than most, but still not good enough. He could mention that the Fed is already pumping inflation into the non-productive stock market and the hard asset market. He could point out that if we shifted that source of money to go to investments in the future, this will probably stave off any future inflation. In fact it is essential to remove the necessity of the Fed pumping up the stock market by shifting the monetary stimulus of the Fed to a more fiscally oriented stimulus from Congress.

YouTube has the INET video The Rise and Fall of the Black Blue-Collar Middle Class.

Umass Lowell Economics professor William Lazonick, outlines the history of how government and economic conditions favored the rise of a Black blue-collar middle class from the 1960’s to the 1970’s, and how shifts in policy and in the economy caused its unmaking from the 1980’s onwards.

The above quote does more justice to this interview that the title that INET chose to use.

Wow, this talk explains so much. I have just finished watching this. I’ll probably be digesting all I learned from this for a long time. One thing they did not get around to discussing were the rules that allow vulture capitalists to buy out any company that is trying to fix the current situation. Not only do the vulture capitalists make huge fortunes by stripping the assets of these companies, but they also scare any other companies from trying to do the right thing. At some point we have to change the rules to protect companies who want to do the right thing, and punish the vulture capitalists who want to ruin the society.

Michael Hudson has posted an article Moving Beyond Dollar Hegemony.

Understanding of the dollar’s world role is dominated by the ideas of ‘dollar hegemony’ and ‘US hegemony’. In this paper, based on our extensive past work, we reveal how these ideas are ideologies, not theories.

The article links to the paper Beyond the Dollar Creditocracy: A Geopolitical Economy by Radhika Desai and Michael Hudson.

However, Professor Summers misses the point. The twentieth century, from our point of view, was actually more an attempted American Century than an accomplished one (Desai 2013) and the shift away from it is looking more certain and decisive than the ‘ifs’ in his assessment let on. The pandemic is less a hinge than an acceleration of the decline of US power based on financialised neoliberal capitalism (Desai 2020a). The structure of world domination that the US had sought to foist on the world in recent decades is breaking down. The US never succeeded; the structure was too unstable and volatile to work. Therefore, one cannot blame the pandemic for reversing even its limited successes. The reversal is rooted in a geopolitical economic earthquake whose rumblings date back decades. They have loosened more and more countries from the contradictory and crisis-prone structures of US domination.

YouTube has the video Webinar with Michael Hudson: a 4000-year perspective on economy, money and debt.

The history of money and debt can make us understand more of the economy, the power of the financial elite and how the world is governed today. This is the claim of economics professor Michael Hudson, who has also been an adviser to governments in the USA, Russia and China. Now he comes to Positiva Pengar to tell how history has been a struggle over who should benefit from the ownership, the money and the debts.

The Bible talks about jubilee years that recurred at certain intervals when all debts were written off. This was to correct imbalances that arise in economies over time. When economics professor Hudson in 1994 published his research that biblical debt relief dates back two thousand years to the Babylonian and Sumerian traditions, it was very controversial. Today it is recognized by Assyriologists, but among most economic thinkers the idea is taboo.

Why was debt write-off a matter of course several thousand years ago, but not today? Hudson’s research shows that, as he writes, “Debts that can’t be paid, won’t be paid.” How then will it be resolved? Do you want to know more? Watch this webinar.

I think there is some overlay, but not complete of the Q and A session of this video and the Q and A session of the post that I made previously – Financialization Is Suffocating the Economy. Actually the video in this post was the first part of the Webinar, and the previous post on this blog was the last part of the webinar. (Actually what I call the second part of the webinar is a later webinar that occurred about a month after this one.)

YouTube has the video Webinar with professor Hudson: financialization is suffocating the economy

More and more economists state that we have created a “financialised” economy where it pays more to passively own than to work, to run companies or in general to do things that benefits society. The financiers are becoming increasingly powerful and richer, while households, business owners and society must tighten their belts. Why do we accept this?

Welcome to an exciting webinar with professor Michael Hudson. He will show how economic and historical myths about money, debt and value have been used to justify an economic system that benefits financiers at the expense of everyone else.

The real meat of this video starts at about 5 minutes in. There is a previous video titled “Webinar with Michael Hudson: a 4000-year perspective on economy, money and debt” which I will post later.

This was a fabulous video. Michael Hudson explained so much. The questions and answers were quite instructive but one. There was a question about the provision of a basic income. Michael Hudson’s thinking about the term was nowhere near what the questioner was thinking. Essentially, Michael Hudson was supporting the Jobs Guarantee, while the questioner was asking about a UBI like what Andrew Yang proposed. If Michael Hudson had realized what the questioner had asked, he would not have supported it. What Michael Hudson said that Pavlina R. Tcherneva supported was incorrect. She does not support not UBI, but she does support the Jobs Guarantee. That shows the Hudson did not understand the question.

Naked Capitalism has a transcript in the article Michael Hudson Discusses Financialization, Rentierism, and Other Favorite Topics with Jessi Ora of Swedish Positiva Pengar Group.

July 13, 2021

Michael Hudson mentioned “The Chicago Plan” in the video. Here is one paper from the Levy Institute – The ‘Chicago Plan’ and New Deal Banking Reform.

Maybe Ron and Rand Paul aren’t as crazy when they talk about fractional reserve banking as I had thought.

Isabella M. Weber has the article Will China Save the US from Inflation Fears?

The Federal Reserve Bank of Atlanta warned last month that the US might be headed toward an inflationary episode on par with the period following World War II, when the release of pent-up demand fueled a 20% surge in prices. But China’s efforts to stabilize commodity prices should help to avoid a worst-case scenario.

I have been reading articles about the possibility of inflation in the USA economy. This is the first article I have read about the history of practical attempts to control inflation.