Euthanasia of the Rentier [View all]

[phantom power]

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/