The resolution of government debt can be postponed for as long as its
bondholders remain convinced, that when the time is ripe to cash in,
they will be able to do so in terms of the current price level.
Expectation in general prevents economic collapse and government is
subject to it as well. That said: only a fraction of us are necessary to
provide all of us with the standard of living we are accustomed to; the
rest are basically parasites who can be (mis)used or neglected at will
by the powers that be, having a system of accounts at their beckoning
call. Whether those parasites indeed get the opportunity to share in
becoming useful contributors, is first and foremost a political issue;
economics certainly doesn't need to stand in its way.
John V
Sandwichman wrote:
But isn't it the point that government debt doesn't have to be
resolved in real terms? By alternating between periods of war-time
prosperity and "peace-time" austerity, the state conceals the "source"
of the "national difficulties". From the perspective of Dilke's
analysis, the term "military Keynesianism" is an anachronism because
the practice pre-dated Keynes by centuries.
On 4/14/08, John Vertegaal <[EMAIL PROTECTED]> wrote:
There is no other way of resolving governmental debt in real terms.
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