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Sun Feb 10, 2013, 03:32 PM

Euthanasia of the Rentier

Hyper-rich Conservatives loathe John Maynard Keynes, and with good cause. His prescriptions for the economy run counter to their Galtian dreams of world domination with themselves in the Howard Roark/John Galt roles. If any of them ever read Chapter 24 of Keynes’ book, The General theory of Employment, Interest and Money, they would realize that Keynes despised them right back. He thought they were a bunch of useless sacks of money with little purpose and less value, a group whose success arises from chance and the false economic theories they support.

Keynes explains that the major mistake people make about economics is the idea that capital is scarce, and must be rewarded heavily to encourage investment in job-creating projects. Keynesian theory says that this view is utterly wrong. Keynes says that the amount of capital needed to operate an economy at full employment is limited, and once achieved, the marginal return to capital will drop to the point that it merely covers depreciation, obsolescence, and a small return for risk and for managerial skill and judgment.

Now, though this state of affairs would be quite compatible with some measure of individualism, yet it would mean the euthanasia of the rentier, and, consequently, the euthanasia of the cumulative oppressive power of the capitalist to exploit the scarcity-value of capital.


Savor that thought for a minute.

Chapter 24 begins with the statement that the twin problems of capitalism are “… its failure to provide for full employment, and its arbitrary and inequitable distribution of wealth and incomes.” The hyper-rich conservatives who dominate our political/economic lives regard those as features, not bugs, and have spent their money to make sure that workers and voters don’t understand that these are real and fixable problems. Practically all economists have lost any sense that Keynes is right, and instead teach us that we have to have a pool of unemployed to make sure that wage demands don’t push up inflation. See, e.g. Mulligan, Casey.

Keynes wrote in 1935.

http://firedoglake.com/2013/02/10/euthanasia-of-the-rentier/

12 replies, 1328 views

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Arrow 12 replies Author Time Post
Reply Euthanasia of the Rentier (Original post)
phantom power Feb 2013 OP
Egalitarian Thug Feb 2013 #1
BlancheSplanchnik Feb 2013 #4
jtuck004 Feb 2013 #6
Egalitarian Thug Feb 2013 #8
Egalitarian Thug Feb 2013 #9
xchrom Feb 2013 #2
freshwest Feb 2013 #3
BlancheSplanchnik Feb 2013 #5
freshwest Feb 2013 #7
BlancheSplanchnik Feb 2013 #10
freshwest Feb 2013 #11
yaakov.eban Feb 2013 #12

Response to phantom power (Original post)

Sun Feb 10, 2013, 03:42 PM

1. If only we could find a way to educate people in how it works.

 

People, even people that are interested and try to inform themselves in economics, just don't seem to be able to understand that their personal financial lives have practically nothing in common with macroeconomics and finance.

How many times have you read, "I can only spend what I take in, so why shouldn't the government live by the same rules?"
& R

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Response to Egalitarian Thug (Reply #1)

Sun Feb 10, 2013, 10:57 PM

4. I wish.... gotta figure out first

How to get people interested in being educated, or continuing to learn.

Not too many people interested in learning. How anyone can stand having no curiosity and no interest in thinking is beyond me.

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Response to BlancheSplanchnik (Reply #4)

Sun Feb 10, 2013, 11:04 PM

6. "How to get people interested in being educated, or continuing to learn."



Most of the educational research literature says people start curious, interested, wanting to continue...until they go to school. That pretty much ends that for most of them.


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Response to jtuck004 (Reply #6)

Mon Feb 11, 2013, 01:52 AM

8. That's a valid point. One that I can attest to personally.

 

From elementary school on, I went from insatiably curious to dropping out the day it was legally permitted. I spent most of a decade building my first business and concentrating on making money, then I went back to college and rediscovered actual learning and absolutely thrived.

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Response to BlancheSplanchnik (Reply #4)

Mon Feb 11, 2013, 02:02 AM

9. Completely agreed, but I think we're both geezers and were spared the most heinous

 

consequences of the politicization of public education. It's one of the hardest thing I find about supporting teachers and the public education systems, what is being done to them is atrocious, but what it has been is horrific.

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Response to phantom power (Original post)

Sun Feb 10, 2013, 03:48 PM

2. Du rec. Nt

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Response to phantom power (Original post)

Sun Feb 10, 2013, 05:34 PM

3. Whoa! I love this. Thanks for posting.

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Response to freshwest (Reply #3)

Sun Feb 10, 2013, 10:59 PM

5. I want to give it to this young woman I know

Who's a self professed Ayn Rand fan, and is really too smart to be so deluded.


By the way...
Hi fresh!

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Response to BlancheSplanchnik (Reply #5)

Sun Feb 10, 2013, 11:05 PM

7. Hey right back at ya! Need some lol cat?



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Response to freshwest (Reply #7)

Mon Feb 11, 2013, 09:05 AM

10. Hey! When do I NOT need lolcat?

Never! Never do I NOT needs me sum lolkittoons!

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Response to BlancheSplanchnik (Reply #10)

Mon Feb 11, 2013, 01:03 PM

11. I like that 'lolkittoons!' Remember the Commie Christmas Cat?

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Response to phantom power (Original post)

Thu Feb 14, 2013, 06:43 PM

12. Keynes wrongly assumes there can be full employment under Capitalism

While the problem of unemployment can be remedied, you won't find any answers among even the most sound apologists like Keynes. The reality of several hundred years of capitalist experimentation seems to prove that as long as the employer-employee relationship, a separation of people into either repositories of capital or labour power, exists there can be no freedom for workers to benefit from and receive the full value of their efforts. If an economy were to experience full employment then the dominant position presently held by capital over labour would be severely minimized and it is unlikely that this system of 'workplace fascism' would survive for very long. Capitalism can't provide full employment, State Socialism can't provide full employment; only a system of worker self-management can produce full or nearly-full employment.

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