At 14:00 05/04/2013, you wrote:
(EW) It's no longer the volume of money that's at issue, Keith, it's the
distribution of wealth as represented by assets, money or whatever.
(KH) Agreed. But where I have the greatest difficulty is persuading people
of the facts of the matter. The true picture is not quite as it seems.
Excluding the last 40 years -- when the dollar went off gold (1971) and
inflation of the dollar started to become rampant -- the wealth
differential between the elite and the motley had never been more benign.
Go back another half-century and we find that the new elite (mainly the new
industrialists) were much wealthier relative to the ordinary worker. Go
back a few more centuries and we find that the elites of those days
(usually army generals) were even more wealthy and powerful. Returning from
the earliest civilizations to the present, note that elites (and their
governments) have become steadily larger. Once the banks have been sorted
out (and we may take it that several other power groups at the top, besides
politicians, are still sore at bankers and their recent earnings and
criminalities and won't rest content until they're put in their place) then
what will take shape next? An even larger elite of various specialized
power groups, I suggest. And also, if the past is any guide, the elite will
be wealthy but not as much as now.
.
Keith
Modern advanced economies are stuck because millions of people who
would spend if they could don't have the means to do so. Modern
economies really have become divided into the 1% (or 20%) that holds much
of the wealth and the 1% (or 80% if you like) that has little of it on a
per capita basis. Redistribution via the tax system or however is
necessary, but it can't happen because the 1% not only holds wealth but
political power as well.
Canadian news reports have recently had some interesting stuff on them
about the large amounts of money the wealthy send from Canada to banks in
places like the Cook Islands to avoid taxation. That definetly needs to
be fixed.
Ed
----- Original Message -----
From: "Keith Hudson"
<<mailto:[email protected]>[email protected]>
To: "RE-DESIGNING WORK, INCOME DISTRIBUTION,EDUCATION"
<<mailto:[email protected]>[email protected]>
Sent: Friday, April 05, 2013 7:17 AM
Subject: [Futurework] The new Keynes would be desirable today
> The ultimate in central bank experiments -- even beyond Bernanke's --
> occurred this week when the newly appointed Japanese Premier Shinzo Abe
and
> his willing sidekick, BoJ Governor Kuroda, have begun to print new
money so
> that there will be twice as much of it flowing in and around Japan's
> economy in two years' time.
>
> It's Japan's latest attempt to get out of the economic depression it has
> been suffering from ever since 1990 -- when it had a standard of living
> that we had just about reached when 2007 crashed around our ears. Unlike
> the US or the UK, Japan hadn't tried money-printing (quantitative easing).
> According to my own hypothesis (economics is driven by status), Japan is
> not really suffering from a depression but from an entirely natural
> steady-state in which most consumers are pretty full up with all the
> consumer goods he will ever need or has the time, energy and skill to
> enjoy, given that some might need replacing from time to time.
>
> What Bernanke (US Fed), King (UK BoE) and, now, Kuroda (BoJ) are trying to
> do is to boost the spending power of their country's consumers so that
> they'll all go to the shops and spend. This is demand-side economics as
> preached by Keynes for most of his life after repudiating Adam Smith's
> "invisible hand"and the supply-side economics of J-B Say ("supply creates
> its own demand" -- that it's only when a consumer sees a new product and
> desires it very badly that he'll then work and save extra hard in order to
> buy it.).
>
> It was only in the last year of his life that Keynes realised he'd been
> wrong. After a difficult meeting of Directors of the BoE in 1946 in which
> the problems of the UK economy had been discussed Keynes confessed to a
> fellow Director, Henry Clay that he couldn't rely on his own ideas to help
> get Britain out of the terrible post-war mess it was in but he would need
> Adam Smith again.
>
> Keith
>
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