Charles Brown wrote:
Let's say a working class' writer on economics like Jim D. or Doug H. were the Fed chair. Would it be possible to use whatever limited control of interest rates to keep unemployment down and inflation up in the interst (pun) of the many rather than for the few ? Would keeping inflation up be pro-masses in net effect or whole impact ? Or are both inflation and deflation harmful to the masses in general ? Are there people's interest rates, theoretically ?
Barely. It might make a marginal difference - a people's Fed chair might let the unemployment rate go lower than a Wall Street/Fortune 500 chair. But that would also cause a riot in the bond pits, meaning long-term interest rates would rise and neutralize the populist policy. And any squeeze on profits could end in a capital strike. The real action has to be in the real sector - tax policy, the welfare state, worker control of enterprises, etc. Loose money can't solve the distributional problems of capitalism - which is one of the things that separates Marxists from populists. Doug
