I fail to see how loose money would lead to permanent full employment. Of
course deliberately running the economy below full capacity/full
employment creates unemployment, but is it really the central bank that
creates the reserve army of labor? Isn't it really inherent in the nature
of capitalism itself? Or am I showing my Marxian dinosaur scales?
Let me be specific - what interest rate would allow for full employment?
3% on the short end, 4% on the long? We had 0.05% T-bill rates in the
1930s, a time of 25% unemployment. Would 10% money growth do the trick?
We had that in the 1980s, and it created a speculative boom in asset
prices, not full employment. Don't you have to deal with allocation of
capital issues, not to mention class power and corporate
ownership/governance?
While we're at it, can we democratize the US government?
Doug
Doug Henwood [[EMAIL PROTECTED]]
Left Business Observer
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