Gernot Koehler wrote:
The new chief of the IMF, former French finance minister Strauss-Kahn,
advocates more active fiscal policies. (IMF neoliberalism out, IMF
Keynesianism back in.) See, his recent speech:
"IMF neoliberalism out?" Here is what he said, virtually in passing. .
<Unless the situation improves, the fiscal authorities in countries with
low fiscal risks should prepare to exploit the headroom for timely and
targeted fiscal stimulus that can add to aggregate demand in a way that
supports private consumption. Of course, it has to be
temporary—maintaining a sustainable medium-term fiscal position is still
very important.>
This is Keynesianism??? Temporary monetary transfers to support private
consumption. In the current situation of stagnant oil and food supplies,
any increase in consumption demand will automatically exacerbate
inflationary pressures. Note that Strauss-Kahn explicitly rules out
fiscal policies involving government investment in infrastructure to
reduce GWG emissions or to provide alternative, sustainable energy
supplies. This is just neoliberalism trying to socialize capital's losses.
Paul Phillips
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