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> On Jan 19, 2020, at 6:14 PM, Louis Proyect via Marxism > <marxism@lists.csbs.utah.edu> wrote: >> >> https://rdln.wordpress.com/2020/01/20/britain-exits-the-european-union-and-takes-a-sharp-right-turn/ > > This is the best analysis I've read. Much of this is useful; a few things one could take issue with. But the following is complete hogwash (which doesn’t mean that Corbyn’s people didn’t also believe it; tragically it seems likely they did): “[T]o the Labour left, ultra-low interest rates are not a flashing red light, but a green light inviting them to borrow vast amounts of money from those who have it, i.e. the super-rich. Yet history, e.g. Greece under Syriza, teaches that, when asked to lend money to a government they do not trust, capitalists are certain to demand a hefty risk premium, wrecking public finances and destroying reformist dreams.” Governments that control the issuance of their own currency and that don’t carry significant foreign-currency-denominated debt don’t need capitalists’ money to spend. (Hint: that’s a conspicuous difference between the UK and Greece. The weather is another. And don’t get me started about the food. But I digress….). Even the WSJ belatedly and begrudgingly acknowledged this about the UK a few years ago: “Among facts that take a stubbornly long time to sink in, here’s one: Countries that borrow in their own currencies never have to default on their debt. “The last few months have tested this notion again. When the U.K. was about to vote on its membership of the European Union, some investors and analysts warned that scared foreigners could dump British sovereign bonds, driving the government's borrowing costs to skyrocket. “They were wrong. The day after Brexit, gilt prices rose 3.5%.” For a (much) more detailed explanation, see this blog post by Bill Mitchell: http://bilbo.economicoutlook.net/blog/?p=34714 _________________________________________________________ Full posting guidelines at: http://www.marxmail.org/sub.htm Set your options at: https://lists.csbs.utah.edu/options/marxism/archive%40mail-archive.com
