Another Economic Update Coming from Government

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KenS

siamdave wrote:

- we do appear to have the same ultimate goal, which is why, no doubt, we can continue to talk. But I myself am completely convinced that this money creation stuff is *the key* to getting rid of the capitalist dystopia - everything they do revolves around money, and allowing the banks to create and control the money is the key to everything. If you do not believe this, I would be curious to learn why you do not see any fault with the current money creation system.

I'll just say what I hope is obvious: that I have significant disagreements with your thesis doesnt mean that I see no fault with the current money creation system.

If what you really mean is that I think we can do radical reforms that challenge capitalism and better peoples lives, while still living with the current moneary system [reforemed but not torn down].... yes, we can. In fact, we must.

But thats the end point [more or less driven by what we have to do], not a starting point.

siamdave wrote:

The thing is, to me, once you understand the money creation process, the theft of literally trillions of dollars is so obvious that I think even the average pretty apathetic Cdn citizen might be galvanized to action if they understood this - and also it is so obvious that the national debt is so unnecessary, that claiming the necessity of dismantling our country in the name of this unnecessary debt is also an obvious and blatant lie that can be used to expose these people completely for the criminals they are.

I'm more than skeptical of all agendas that begin with "if/when people understand _____ ...." Even analysese I agree with, let alone ones I dont.

People can beleive as me. Believe as you. Even more of them are going to be inclined to flat out irrational conspiracy theories of how we're being robbed.

All that is required is a common "this doesnt work for me /us." That is all we will get to work with, and all that is necessary.

And just on a persoanl practical level, you might think that our experiences over the decades would make one rather gun shy of subtextual formulations that are variations of: "when people understand ________ , it can only be obvious that blank, and hopefully this will galvanize them to action."

Now virtually everyone recognizes that the third part is highly contingent- 'hopefully this will galvanize them to action'. And when it doesnt and we are of course disspointed [again].... this is where the failure is seen. And that analysis, as far as it goes, might extend back to the failure of people to 'understand'.

But the failure is in the whole doomed formulation- the three parts and how interdependent they are.

George Victor wrote:

David, your idea of reform from within the monetary system is exactly correct, I believe...except that it is not reachable without the prior dismantling of all capitalist institutions.   Which places your "solutions" up there with the second coming. 

 

I dont entirely agree with George on this. But close enough. And totally on the part that the "reform" of the monetary system being advocated requires or would amount to the abolishing of capitalism.

So there's a basic cognitive dissonance in saying things like 'there's no reason the Bank of Canada cant just issue money for program X.... after all, they let the banks do the same thing on our dime.'

We are still a LONG way from getting started on what can be done within the parameters of the system more or less as it is. You know, all those things on the economic and social program front that we are held back about because the NDP "doent have the guts" to talk about them.

Now you may think that such efforts, when and if they get underway, will be doomed unless the fundamental power of the system is at least "understood" if not challenged. And to a point, I agree.

But first we have to go there. Let alone we are not even in pre-'go there' yet. The main point, is that we'll talk about that when we get there.

Plenty of us can and should talk about it before we getting there. But positing that is necessary that people first 'understand' [what we dont yet agree on].... or that if it isnt necessary, that it is the key to 'waking people up'.... that is the road of sorrows and failure we've down more than enough already.

JKR

siamdave wrote:

I think the restructuring of the entire economic system that would result from getting the banks out of the money creation game would have benefits many cannot even imagine yet.

How could the banks be taken out of the money creation game?

Are you saying the banks should be nationalized?

KenS

More like, simply put out of business. No place for anything resembling the institutions we call chartered banks.

Sort of swept aside in the process.

Long thread a problem for my dial-up connection.

Continuing at Economic Agendas- theirs, ours, whatever

Michael Moriarity Michael Moriarity's picture

I have read Dave Patterson's web page "What Happened?" and I'm not really sure what to think of it. My expertise in economics and particularly monetary theory, just isn't up to the task. As well, the sources cited there don't seem to include any recognized economics professionals, even clearly left wing ones. (OK, there is one picture of John Kenneth Galbraith, with a quotation as caption.) Most of the people quoted seem to be amateurs. This doesn't mean that they are wrong, just that it is hard for me to feel confident that they really know what they are talking about.

However, there is one point Dave makes which, if true, would refute rather strongly those who, like George and Ken, think that a significant change to the money creation process would require the abolition of capitalist institutions. Dave says that in the 1970s there was a major change in the relative functions of the Bank of Canada and the commercial banks. He claims that before this time, most government borrowing was from the Bank of Canada, at low or no interest rates, and any interest paid would go back into the public purse in any event. He says that this change explains why huge interest payments on government debt have become a major component of budgets since that time.

Dave seems to believe that we could fix the problem by simply going back to the way things were between the passage of the Bank of Canada Act in 1934 and 1970. Now, I presume we can all agree that capitalism was the economic system during that period, so if Dave is correct in this assertion, then we could make very significant change to the money creation system without getting rid of capitalism. I have spent an hour or two wandering around the internet looking for details on this change in the 1970s, but without much result. Was there a bill passed by parliament? An order in council? Changes to administrative rules? I haven't been able to find an answer.

I would welcome any light that Dave, or any other babbler can shed on this matter.

Edited to add: Cross posted with KenS. I will re-post this in his new thread.

 

siamdave

George Victor wrote:

David, your idea of reform from within the monetary system is exactly correct, I believe...except that it is not reachable without the prior dismantling of all capitalist institutions.   Which places your "solutions" up there with the second coming. 

The idea of an "economic imperative" was the most demoralizing revelation with the appearance of the Chicago School in the mid-70s.  From that moment the "ideas" of we reformers became only something to try to hold on to, to keep from destruction by the new forces that were giving people seemingly limitless credit, and workers could fly the family to the Dominican Republic in February.

The unions?  You can't have read of their destruction by private/public industries' movement of jobs around the world or within the country of their birth.  Your explanation:

"THe decline of unions could be attributed to either their failure to understand what was happening or, more likely, their selling out to corporate-banker power. Like all of our other quisling leaders then and since." ...comes from the purely romantic political assessments of people who are not familiar with the economic forces at work in recent history.

 

In your own case, the lack of understanding of the concept "economic imperative" seems strangely out of place for one so knowledgeable about the history of our monetary system. But then specialization will do that.

 

And of course, you are not alone in not understanding the causative effects of changes in capitalist institutions - particularly financial - and globalization's meaning for all those investment funds, with meaning for so many hereabouts. Some days, it's almost as though people are simply tilting at the windmills of an unreal world, something out of the past. That's when the morality machine takes over.

- I guess the only thing left to say is that you seem to be a TINA person, following Ms Thatcher and Friedman et al, and I'm more of a Dylan Thomas 'rage, rage against the dying of the light' sort.  You're no doubt on the side of the winners - but your prize is going to be pretty dry and joyless, I predict. The capitalists aren't known for their beneficence to their sycophants. (see C Dickens, U Sinclair, etc - you seem to be one of the ones here who at least reads things over a few hundred words, although for some reason you appear to be avoiding my essay like the plague, within which most of your concerns are addressed..) Your apparent lack of understanding of anything I am talking about is a bit puzzling (note difference between 'had to', as in 'economic imperative', and 'chose to', as in 'sold out' or 'gave up'..), but you seem a bit hubristic, so perhaps you assume you are looking somewhere behind you when you talk to me, without realising I have, as they say, perhaps lapped the field and you should be looking far, far ahead somewhere, where new things happen.

siamdave

JKR wrote:

siamdave wrote:

I think the restructuring of the entire economic system that would result from getting the banks out of the money creation game would have benefits many cannot even imagine yet.

How could the banks be taken out of the money creation game?

Are you saying the banks should be nationalized?

'- if you'd at least try to read the essay, you could avoid things like this. I have said nothing about nationalizing banks - we simply stop commercial banks from creating money, and reserve that extremely important power for the national government. Under democratic control.

George Victor

I'm not on the side of finance capital's reformers, dave.  They're the enemy. Point to a single entry where I have said not just that such and such has occurred, but that that was good.

But you cannot distinguish the normative from a simple recitation of what has occurred, and why the powers that be made it happen.    It's all bad, of course, and made worse by people like yourself who refust to recognize it as you tinker with your monetary system.

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