Antidote to Osborne’s fairytale economics

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Panel of leading economists discuss and debate the true state of the economy and the lies underpinning the Government’s austerity programme.

The panel includes:
Owen Jones, Journalist
James Meadway, Senior Economist, New Economics Foundation
Ann Pettifor, Prime Economics
Micheal Burke, Economist
Chaired by:
Christine Blower, General Secretary, NUT

This economic briefing was recorded just a few days ahead of George Osborne’s Autumn Statement… but none of the panellists came close to anticipating the level of hubris, triumphalism and double-dealing that accompanied the Osborne Autumn Statement.  It was a truly breath-taking performance!

Find out the real effects and intent of austerity that George Osborne and the Government don’t want you to know…

 

The People’s Assembly Against Austerity – Economic Briefing – 27.11.14

Owen Jones attacks the BBC’s pro-establishment bias

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Owen Jones on the BBC’s pro-establishment bias – Newsnight

A Very Public Sociologist writes – ‘Why the BBC news ignored the People’s Assembly March’

Content analysis shows its current affairs coverage dresses to the right.  My own number crunching of Question Time found there was a bias toward rightwing guests.  In this instance, is the BBC’s reportage, or lack, underscoring a straightforward Tory bias?  Well, it does speak of pronounced lean to, but the reasons aren’t as simple as one might suppose.  We’re going to have to grub around in the political economy of BBC news production once more.

Read the whole piece for a review of the BBC’s cognitive bias, what the establishment considers newsworthy and its institutional long term interests.  However, Phil concludes on this positive note:

…..That’s what it comes back to, the web of institutions, interests, and habits of mind the BBC are a constitutive part of.  Getting a feature is not the be all and end all of protesting.  Anti-austerity campaigns have been carrying on regardless since the Tories’ first round of cuts.  There’s no reason to believe that’s going to change.  However, the only way the BBC will report the anti-austerity message is by making it, if you pardon the ugly word, unignorable.  And come the TUC-backed march against austerity in the Autumn, we have every chance of making that happen.

 

Why do politicians tell us Debt/Deficit myths which they must know to be untrue?

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The New Economic Perspectives’ video clip on the Government budget, Deficits and Debt presented below (produced for educational purposes), debunks the myths that politicians tell their populations to justify ‘austerity’.  In the case of the clip, it starts with 3 full minutes of American politicians misinforming the electorate.  An identical montage aimed at the UK electorate could undoubtably just feature George Osborne’s utterances from his forthcoming Autumn statement scheduled for this Thursday (5th December 2013).

However, the reality is that all economists know that the deficit and debt mythologies are not true and ‘have long known that the idea of balancing budgets over the cycle is a bit like a fairy story we tell to frighten the kids’.  Economists, and Central bankers like Mervyn King, Ben Bernanke, Alan Greenspan, all know that:

The UK government can never ‘run out’ of money;

The UK government can never be forced to default;

The UK government can never be forced to miss a payment;

The UK government is never subject to the whim of ‘bond vigilantes’.

In fact, the St Louis Federal Reserve, from the heart of Western capitalism in the US confirms the same for the US dollar (and any other nation that creates its own currency) :

‘As sole manufacturers of dollars whose debt is denominated in the dollar, the US government can never become insolvent ie. unable to pay its bills.  In this sense, the government is not dependent on credit markets to remain operational.  Moreover, there will always be a market for US government debt at home because the US government has the only means of creating risk-free dollar-denominated assets.’

Paul Samuelson, ‘father of modern economics’ and Nobel Prize winner, suggested the reason for perpetuating the mythologies in a 1995 interview:

“I think there is an element of truth in the view that the superstition that the budget must be balanced at all times [is necessary]. Once it is debunked [that] takes away one of the bulwarks that every society must have against expenditure out of control. There must be discipline in the allocation of resources or you will have anarchistic chaos and inefficiency. And one of the functions of old fashioned religion was to scare people by sometimes what might be regarded as myths into behaving in a way that the long-run civilized life requires. We have taken away a belief in the intrinsic necessity of balancing the budget if not in every year, [then] in every short period of time. If Prime Minister Gladstone came back to life he would say ‘uh, oh what you have done’ and James Buchanan argues in those terms. I have to say that I see merit in that view.”

It may be that politicians fear the ‘anarchic’ demands of the electorate were the public to understand that the UK economy is not like a household and can never be bankrupt.  However, these distortions of reality have been carried to a new pitch by George Osborne and the Coalition government:

The scale of the Coalition government’s intended austerity measures are on a scale never seen in modern Britain. What is planned here will dwarf anything that was undertaken by Thatcher in the 1980s. There is already massive unemployment in the public sector….Massive unemployment and lower wages mean lower tax receipts, and even bigger budget deficits and debt loads…It is now clear that the austerity policy in the UK is not a matter of economic necessity but of political choice… It is obvious that the cuts of this scale are about much more than just deficit reduction… The cuts are part of an agenda to transfer services from the public sector to the private sector. The pretence of ‘there is no alternative’ is a means for the Conservative project to radically transform the state.

http://www.globalresearch.ca/uk-economy-falls-into-double-dip-recession/5313842

It would be just as well to remember this week, when listening to George Osborne and Danny Alexander, that Keynes said:

’Capitalism is the extraordinary belief that the nastiest of men, for the nastiest of reasons, will somehow work for the benefit of us all.’

 

New Economic Perspectives on the Government Budget, Deficits, and Debt

Published on Nov 28, 2013

The video clip features the following speakers, in order of appearance:

L. RANDALL WRAY
Professor, Economics, University of Missouri-Kansas City
Senior Scholar, Levy Economics Institute
Author, Understanding Modern Money, Modern Money Theory
http://www.economonitor.com/lrwray/

STEPHANIE KELTON
Professor, Economics, and Chair of the Department of Economics, University of Missouri-Kansas City
http://stephaniekelton.com/

WARREN MOSLER
President, financial services firm Valance Co. Inc.
Author, Soft Currency Economics, The Seven Deadly Innocent Frauds of Economic Policy
http://moslereconomics.com/

For More Information:

University of Missouiti-Kansas City, Economics Blog:
New Economic Perspectives
http://neweconomicperspectives.org/

The Modern Money Network
http://www.modernmoneynetwork.org/

Other posts from Think left:

George Osborne says we’re running out of money ..

The fundamental deceit of ‘There’s No Money Left’

Today’s Struggle – Still “Brassed Off”!

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Danny’s Inspirational Speech from Brassed Off 1996 gives us pause for thought, and inspiration to fight.

People Matter, not things…… how does it feel when people have lost the will to live, because of governments?

What’s happening now? Homelessness, poverty, hunger and desperation faces so many, directly because of this current government policies.
While Debt the Ripper stalks Europe, inspiration is needed to fight this class war. Collectively, we can oppose it, the strength of many so greater than suffering alone.

We seek no more internal divisions of the Left, and working class people. The People’s Assembly is uniting the opposition against the Coalition government.

We do not accept that government’s austerity programme is necessary. The banks and the major corporations should be taxed at a rate which can provide the necessary resources. Austerity does not work: it is a failure in its own terms resulting in neither deficit reduction nor growth. It is not just: the government takes money from the pockets of those who did not cause the crisis and rewards those who did. It is immoral: our children face a bleaker future if our services and living standards are devastated. It is undemocratic: at the last election a majority voted against the return of a Tory government. The Con-Dem coalition has delivered us into the grip of the Tories’ whose political project is the destruction of a universal welfare state.

We therefore choose to resist. We refuse to be divided against ourselves by stories of those on ‘golden pensions’, or of ‘scroungers’, or the ‘undeserving poor’.

We do not blame our neighbours, whatever race or religion they maybe. We are not joining the race to the bottom. We stand with the movement of resistance across Europe.

We are clear in our minds that our stand will require us to defend the people’s right to protest, and so we support the right of unions and campaigns to organise and take such action as their members democratically decide is necessary.

We stand with all those who have made the case against the government so far: in the student movement, in the unions, in the many campaigns to defend services, the NHS, and in the Coalition of Resistance, the People’s Charter, UK Uncut, the environmental movement and the Occupy movement.

We do not seek to replace any organisations fighting cuts. All are necessary. But we do believe that a single united national movement is required to challenge more effectively a nationally led government austerity programme.

Read the draft statement in full

See The Empire of Things, in memory of Margaret Thatcher