Government led recovery, not gas.
Posted Apr 30, 2021, 9:57 AM UTC
79
This may well be the dumbest thing I have ever seen "economists" present.
Let me explain:
The current economy has not recovered - it has been given an almost trillion dollar injection from the government which has been delivered via raising debt. Lets leave out MMT for the moment - this is how it has been done.
There has been SOME money printing via quantitative easing done - but primarily it has been done via raising debt - which MUST be repaid.
These guys are literally standing here claiming that the government massive debt binge - which did NOTHING for the productive economy, but literally went into peoples spending - and primarily a house price boom - has saved the economy. Its honestly quite insane.
The only way an economy can become wealthy is via exports - services, cars, resources, financial products (services), electronics, manufacturing, wine, cheese, etc.
We MUST earn export dollars to RECOVER.
They even go so far as to put up the "export" index to show how bad it is - but look GOVERNMENT SPENDING !!!!
How are we going to get REVENUE to pay back the debt, to repay the bonds, that we are currently saddled with ? Thats right - gas.
It would be far better to nationalize that gas to repay the debt faster than the ridiculous levels of revenue we receive from royalties etc and the small amount from revenue from receipts.
If the government had used the debt to build new silicone chip foundries, or high materials manufacturing, chemical and bio-tech fabrication, green steel and EAF recycling, hydrogen export plants, high speed rail, literally ANYTHING that was productive then there would be some measure of "KEYNES" in their argument.
But they did not.
The single dumbest "economic" post in the history of stupid economic posts.
-1
If you're just going to talk about Keynes he DID show that government spending that increases incomes results in consumption, that drives sales, that in turn causes businesses to increase output when they see their inventories decline. This is particularly effective when you target higher MPC agents in the economy (jobless people seem to fit that bill well I think we can agree) and that helps address the 'paradox of thrift' problem. I believe this can be considered Keynesian to at least some degree, just not nearly to the same degree it might have been should Labor have been managing it. It's not the most efficient example of Keynesian economics but it's still that.
Who are we paying the debt to BTW? People in the economy who are holding the bonds like you and me? The reserve bank? Foreigners who are holding them as a result of our ability to consume more than we produce with some nations in terms of trade? I don't see any issues there; paying ourselves back with a yield that's essentially a small fiscal outlay, the RBA that's just the right pocket of government, or foreigners who had to use our currency to purchase bonds usually after they've accepted them due to trade imbalances that favour an increased living standard for us are not necessarily negative things at all. Also why do we need to worry about revenue in the first place? Taxes are paid with money that's been spent into the economy already last I checked, and there was no revenue required to spend that money, just a government that issued it and credited some bank accounts.
6
he DID show that government spending that increases incomes results in consumption, that drives sales, that in turn causes businesses to increase output when they see their inventories decline
No he didn't. He talked about GDP. Entirely different. Further sales during the pandemic were almost ALL offshore (ebay, amazon) adn the consumption of services (The NEtflix effect, again exports) Further they do not "increase output" - what the fuck? At most they may have returned them to a somewhat moderated level.
Either way - this is not considered Kyensian. Consumer spending has repeatedly been shown to have diminished effects (person buys foreign tv - the end).
Keynsian spending flows through the economy impacting at every stage with multiplier effects. Government does infrastructure job - planning (jobs), hire PR (jobs), hire construction (jobs), materials (jobs), building (jobs), every step of the way - and each of those people with JOBS now spends - and the effects lasts a long time - moreover the new high speed rail, or smart grid massively increases the productivity of the country which in turn creates more wealth.
As opposed to giving some random some money which they spend on a TV and Netflix - straight off shore.
Less than 20% of our bonds are sold to Australian banks - most of it is then resold into the foreign debt markets - yes it is paid to foreigners - that is a complete fucking disaster of epic proportions.
Then you just wander off into the most random shit. If you think our living standards aren't predicated on how much we earn via export earnings then you really should not be commenting on economics at all - based on what you have written about you genuinely think we can just print money and thats all there is too it.
That is so delusional its ridiculous. You have CLEARLY been reading MMT theorists who have no fucking idea and are the biggest pack of morons since flat earthers - they really are dumber than that.
-1
I think you get defensive every time MMT is mentioned because you can't refute it. That's the pattern I've observed anyway... You just throw out logical fallacy or have a tantrum post instead of addressing it when it's posted, and I think because you don't fully comprehend it and that's your means of coping.
What I posted was literally about expenditure multiplier and attaining an new equilibrium at an increased GDP because of it... it's Keynesian whether you want to admit it or not. COVID prevented more efficient types of spending (Building a dam or whatever) because... COVID prevented people from getting together. We had to rely on consumption driving increased output as per what I stated and had to be careful not to induce stagflationary consequences given we voluntarily induced a supply shock to the economy. The coalition did it wrong by handing money to businesses more than unemployed or working people, but otherwise this is probably the only type of Keynesian policy available in this unique type of crisis. And it's a darn sight better than trying to let markets take care of things as well.
2
Cheers.
Explain FX debasement.
1
Whatever - you don't know what you're talking about - its just gibberish.
-2
The only thing this Govt. is winning is the corrupt, grubby, bullshitting through the ass, rapist, cover up, nothing to see here, bully boy, misogynistic, totalitarian, white evangelical Maiden Handicap, sponsored by Uncle Rupert.