On more time on Stockman as this is typical of what’s wrong with mainstream thought:

The Federal Debt Freight Train Is Coming at Mr. Market

By David Stockman

Aug 6 — Nominal GDP has been growing at only $4 billion per month, while new Federal debt has been accumulating at around $100 billion per month.

Federal deficit spending adds income and savings of dollar denominated financial assets to the economy. The fact that this is being done and excess capacity and unemployment is still high shows the economy’s desire to save is even higher, and that additional deficit spending is needed to expedite a return to full employment.

Hence, my proposed full payroll tax (FICA) holiday.

The federal deficit is no longer an abstract long-term problem; it’s a financially critical freight train coming down the track at alarming speed. Here’s a dramatic way to look at it: As of last week’s second-quarter report, nominal GDP was only $100 billion higher than it was back in the third quarter of 2008. So the nominal GDP has been growing at only $4 billion per month, while new Federal debt has been accumulating at around $100 billion per month. Yes, this period represents the worst of the so-called Great Recession — but never in history has the Federal debt grown at a rate of 25x GDP for two years running!

Yes, because because the desire to save (reducing debt ‘counts’ as savings) grown so quickly, due to the financial sector crisis that followed the fraudulent sub prime expansion.

And notice he doesn’t mention anything actually wrong with larger deficits, just continuously uses negative language regarding magnitudes and direction.

Secondly, this time is very different in terms of the business-cycle impact on the budget. During the past three quarters of “recovery” where we’ve had real growth of 5.0%, 3.7%, and 2.4% respectively, nominal GDP growth has only averaged about 4%. This is steeply below the figure for past cycles when we had 7-10% nominal GDP growth due to higher real growth and also much higher inflation. Consequently, nominal GDP — which is the true driver of Federal revenue since they tax our “money” income, not the statistical “real” income confected by the BEA/Commerce Dept — has only grown at $50 billion per month during the last three quarters. So, the Federal debt has still grown at 2x the rate of GDP during what looks to be the strongest phase of the recovery.

Yes, this is because the deficit is still not large enough to offset desires to save by not spending income, and inability and lack of desire of the private sector to go into debt.

For a given size govt, the readily available federal response to get the private sector back to full employment is to cut taxes sufficiently so the private sector can resume sufficient spending out of income rather than via debt expansion.

Public sector expansion will also return us to full employment. It’s a political choice as to whether we want more government or not.

Thirdly, if we’re in a sustained debt deflation (below), it’s extremely probable that the GDP deflator will shrink toward zero and real growth will struggle to make 2-3%. Hence, nominal GDP growth is almost certain to be even slower in the quarters ahead — say 3% or $40 billion per month — than it’s been since last summer.

Agreed this will happen under current circumstances if private sector debt expansion doesn’t take place.

This “realistic” outlook compares to the OMB forecast which assumes double this level of nominal GDP growth — a 6% annualized rate, or about $75 billion per month. At the same time, there’s virtually no chance that unemployment will drop much below 10% in the context of a deflationary “recovery” — meaning that budget costs for unemployment, foods stamps, etc. will remain elevated, not come down by hundreds of billions as currently projected, either.

Also likely without private sector debt expansion. Watch for car sales and housing expansion, which are generally the source of private sector credit expansion.

Consequently, under the current policy baseline and including extension of the Bush tax cuts (at a cost of about $300 billion per year), and with even mildly deflationary economic assumptions, it’s not possible for the baseline deficit to drop much below $1.5 trillion any time before 2015.

Ok, point?

So we have baked into the cake a rather frightening scenario: monthly federal debt growth of upwards of $125 billion, or 3x the likely nominal GDP growth of $40 billion — as far as the eye can see.

The deficit isn’t frightening, it’s the continuing output gap that’s frightening and screams for a larger deficit- tax cut or spending increase, depending on one’s politics.

The real problem is this type of fear mongering from Stockman is what prevents the prosperity that’s at hand from happening.

Fourth, the publicly held federal debt will be about $9 trillion at the September fiscal year end, and at the built-in 3x GDP growth rate will reach $12 trillion when the next president is sworn in in January 2013. Adding in state and local debt, we’d be at $15 trillion or a Greek-scale 100% of GDP before the next president picks his or her cabinet. Every reason of prudence says not to tempt the financial gods of the global bond and currency markets with this freight-train scenario: Do something big to close the deficit, and do it now.

Now he brings in the Greek fear mongering.

By acting as if we could be the next Greece, we are well on the road to being the next Japan.

Greece is not the issuer of its own currency, but is analogous to a US state like California. There is no solvency issue for governments that are the issuer of their currency, like the US, UK, and Japan.

Fifth, there’s no possibility in either this world or the next of obtaining the needed $700-$1,000 billion structural deficit reduction by spending cuts alone. We’ve had a rolling referendum since the first Reagan budget plan in 1981, and progressively over these three decades the Republican party has exempted every material component of the budget from cuts, including middle-class entitlements, defense, veterans, education, housing, farm subsidies, and even Amtrack! Like Casey, the GOP has been in the anti-spending batter’s box for 30 years, and has never stopped whiffing the ball. The final proof is that the one GOP spending cut plan with any integrity — the “roadmap” of Congressman Paul Ryan — has the grand sum of 13 co-sponsors, and I dare say half would call in sick if it ever came to a vote. Therefore, tax increases are now needed because it’s too late and too urgent for anything else.

Again, implying there is some benefit to deficit reduction when there is excess capacity and unemployment as far as the eye can see.

Sixth, both the Keynesians and the supply-siders are wrong about the alleged detrimental impact on the business-cycle recovery of a big deficit reduction package — including major tax increases. The reason is that both focus on GDP flows — with Keynsians pointing to a subtraction from consumer “spending” and the supply-siders emphasizing a detriment to output and investment. But under present realities, the problem isn’t the flows; it’s the massive, never-before-seen stock of combined public and private debt that’s depressing the economy, and which overwhelms any “flow” effects from fiscal policy.

No he’s combining public and private debt to enhance the fear mongering and miss another important point.

Specifically, at $52 trillion, credit market debt today is 3.6x GDP, compared to 1.6x GDP when the original supply-side versus Keynesian argument opened up back in 1980. Moreover, this 1980 total economy “leverage ratio” hadn’t fluctuated appreciably for 110 years going back to 1870. So I call it the “golden constant,” and note that had the total economy leverage ratio not gone parabolic after 1980, credit-market debt today would be $22 trillion at the 1.6x ratio. In short, the economy is freighted down with $30 trillion in excess debt; the process of liquidating the household and business portion of this — about $24 trillion — will swamp the normal cyclical recovery mechanisms for years to come. And it’s insane to keep adding the mushrooming public-sector portion of the debt or order to artificially juice the GDP numbers for a few more quarters.

As above, reducing private sector debt (including non residents) is done by the private sector spending less than its income, which can only be accomplished if the public sector spends more than its income.

Finally, in the context of a secular debt deflation, the overwhelming priority is public-sector solvency, not conventional growth.

Notice he has not made the case that there is a solvency issue. It just ‘goes without saying’ when in fact there can be no solvency issue for a govt that issues its own currency.

So policy needs to be geared to long-term balance-sheet repair, not short-term flows.In every sector — household, government, business — the numbers are awful, and far worse than the bullish mainstream seems to recognize. Let me close with one example: At least once a day someone on CNBC talks about the $1.5 trillion in corporate cash on the sidelines, and how healthy the business-sector balance sheet is. Pure baloney. Consult table B 102 of the flow of funds, and you’ll see that corporate-sector cash assets have indeed increased by $279 billion since the December 2007 peak, and now total $1.72 trillion. But non-financial corporate-sector debt according to the same table, has increased by $480 billion and now stands at $7.2 trillion — so that corporate debt net of cash has actually increased by $200 billion during the Great Recession. Stated differently, corporate debt net of cash was $5.3 trillion or 36.7% of GDP at December 2007 and is now $5.5 trillion or 37.6% of GDP. There’s been no deleveraging in the business sector either — especially when its noted that tangible assets have also declined by 20% on a market basis and are flat on a book basis during the same period.

Fact is, ‘savings’ for the economy as a whole (not including govt) has gone up by exactly the amount of the deficit, or someone in the CBO has to stay late and find his math error.

30 Responses

  1. Stockman: “But under present realities, the problem isn’t the flows; it’s the massive, never-before-seen stock of combined public and private debt that’s depressing the economy, and which overwhelms any “flow” effects from fiscal policy.”

    Private debt is a burden. Sounds like it’s time to go Biblical: counter-cyclical policy (Fat Years and Lean Years) and debt forgiveness (Jubilee). And don’t forget a national Usury law.

    Debt forgiveness outside of bankruptcy is probably unconstitutional. 🙁 But going forward, if we are going to have a consumer-based economy, isn’t a national Usury law a good idea?

    1. Min, read Michael Hudson on financial capitalism as parasitical on the economy. It purpose is rent-seeking, which is a polite was of saying extraction of economic rents — land rent, monopoly rent, and money rent (interest). This is all a form of “usury” in the classical sense of getting something for nothing (no production). Problems arise when financial capitalism no longer serves productive capitalism through financing production, but rather focuses on extraction of economic rents.

      According to Hudson, surplus that is not taxed eventually gets extracted as rent in some from, so the way to end usury is through appropriate tax policy. This is the story behind the mantra “low taxes and low government spending.” The idea is that this will go to investment, but the reality is that under the present system it goes to extraction and gets funneled to the top — the rentier class.

      According to Hudson, classical economics (18th century) was developed with an eye to limiting the rentier class, at the time the monarchies and aristocracies that controlled land rent, which was the primary rent at the time. Land rent is still a big issue, but monopoly rent and money rent are much larger problems now. This is adversely affecting both demand and productive investment globally.

    2. Usury by definition is the charging of interest at above the maximum rate allowed by law. Pretty much every state has a usury law, although the maximum rate rate allowed varies a great deal from state to state and also depends upon what type of business the lender is in. Usury laws strike me as counterproducive unless they’re specifically aimed at preventing unsophisticated people from being defrauded. And of course, if your goal is to prevent people from being defrauded, anti-fraud laws should be enough.

      As to Tom’s point about the evil, rent-seeking bourgeoisie, I wonder if he has considered the evil, rent-seeking proletariat who acquire desperately needed trade skills and then charge exorbitant rents to the bourgeoisie to engage them.

      My doctor can make $150 for chatting with me for 15 minutes and then prescribing pills that somebody else designed and manufactured! My auto mechanic charges me $65/hour x 3 hours labor for a job that takes him only about 75 minutes to do because he has all of this fancy equipment and he’s got so much experience!

      And my karate sensei makes $20/person for an hour long group class, and all he does is yell at people all class, which he evidently enjoys immensely. If he wasn’t a 10th degree black belt and me just an orange belt, I would kick his rent-seeking butt back to making an honest living picking strawberries or something.

      Of course, the only real rentiers are monopolists, and the only monopolies I can see these days are public sector labor unions.

      1. ESM: “As to Tom’s point about the evil, rent-seeking bourgeoisie, I wonder if he has considered the evil, rent-seeking proletariat who acquire desperately needed trade skills and then charge exorbitant rents to the bourgeoisie to engage them.”

        Touché. There is a lot of this, but the examples you cite aren’t some of them. Doctors are well paid and perhaps overpaid but that many factors are involved including complicated insurance issues, as well as the long training time that doctors are required to undergo and the monopoly of the doctors’s “union” exerts. BTW, doctors don’t do the billing themselves, of course. The rates are generally pretty will established by region and that’s how the office bills. Doctors make money by working fast, not over-billing. I don’t think that the compensation of GP’s is too high from what I can see, although it appears to me that specialists may be overcompensated. But this is a thorny issue, and not the best one to cite, although a lot of people have an emotional charge behind it. But I know GP’s that have closed their offices because overhead is so high and moved to a clinic or HMO where they paid on contract.

        If you have a mechanic that charges only $65, I wouldn’t complain. The going rate in many places is $90. Professional shops usually bill according to the industry time schedule associated with the particular job, which they just look up. They make more if they beat it, and they eat it if they don’t. That’s why they work fast and have all those specialized tools. If you guy is only charging $65 and taking a long time, there may be reason and you may not be saving money using him, even though his per hour charge is lower.

        $20 an hour for a 10 degree black belt (like a full professor) isn’t bad. You pay more in college and usually don’t ge to see a full professor up close until grad school.

        The morning my sister-in-law whose gutters I usually check and clean when needed (10 minute job) decided I was getting to old and frail for ladders, I guess, so she called to find out how much it would cost to have the job done “professionally.” $90 an hour with an hour minimum charge! Of course, high school and college kids don’t do that kind of stuff anymore. Now that’s what I call monopoly pricing.

        the only monopolies I can see these days are public sector labor unions.”

        Funny that the competition for these jobs isn’t though the roof if the compensation is so good.

        BTW, I happen to know the real cost of many imported products that are sold in the big chains. Americans would faint if they knew the actual markup. The stores still make some money over cost of goods sold on a 70% off close out sale.

      2. “BTW, I happen to know the real cost of many imported products that are sold in the big chains. Americans would faint if they knew the actual markup. The stores still make some money over cost of goods sold on a 70% off close out sale.”

        Now we are talking profits!

      3. ESM,
        From Min’s Biblical perspective, it seems usury was charging any interest at all back then (think ‘natural rate of interest is zero’).

        It looks like deals were supposed to be structured for a % participation, or a type of royalty in today’s terms, not as ‘loans’.

        Resp,

      4. Yes, that’s true. And even today of course, the charging of interest is not considered “kosher” under Islamic law. But of course it’s ok to get around it by structuring the loan as a guaranteed equity participation or as a repurchase transaction.

        From what I’ve seen, the IRS is much more of a stickler for the rules than God. And more wrathful.

  2. “Pure baloney. Consult table B 102 of the flow of funds, and you’ll see that corporate-sector cash assets have indeed increased by $279 billion since the December 2007 peak”

    I think he is cherry picking his data to an extent.

    He is looking at data from end of 2007, while GFC didnt happen until end of 2008. Much was issued by corporate sector in 2008 prior to the problems that occured in the fall of 2008.

    If you look at his Table B.102 (page 112 of 125 of the Feds latest Z.1), since the end of 2008 which to me is the relative range, it looks to me that the non-financial sector has increased FAs by over $700B thru end q1 2010(thats in 15 months! I expect this number to have substantially increased again when the thru 2Q 2010 report comes out next month) and issued only about 106B (probably all REITs) in new liabilities that are ‘Credit Market Instruments’. The rest of the corporate sectors liabilities are listed as “Miscellaneous” which I suspect has to do with some sort of accounting methods in dealing with the large external deficit over this same period.

    Resp,

    1. For Modern Monetary Theory, I do believe that 2008Q4 is the relevant start point … from December 2007 through the middle of 2008 the US was in an incomes recession from the collapse of the housing bubble and the crude oil price shock … but the upsurge in demand for savings followed the financial crisis, the “Panic of 2008”, where rather than focus on fixing balance sheets after the bubble burst (as, for instance, the Australians did, to their substantial later benefit), the Fed was trying to fix the balance sheet problems with liquidity.

      The spike in the desire to save was after the financial crisis hit, and not the onset of the recessionary phase of the business cycle itself.

      1. Bruce Hi,
        Consider that the US govt deficit didnt crank up in earnest until after the passage of the “Stimulus” in February 2008 and the automatic stabilzers kicked in that same quarter due to job losses resulting from the GFC in October 2008. The non-financial sector in US has really slashed expenditures and seems to be raking in most of FAs created by the huge govt deficits since then ($Trillions). Stockman’s main point seems to be arguing against debt? He seems to think there are no winners here, I think the non-financial corporate sector is doing more than ‘ok’ due to the high govt deficits.

        I think Stockman may be missing that the US financial corporate sector is having their a__es handed to them by the US non-financial corporate sector (quite fun to watch!). Probably Exxon-Mobil is making more money in one quarter than the entire financial sector is making all year in true lending operations. US adjusted new home sales for May came in at 267,000 annual unit rate (lowest since 1963!), recent monthly average seems to be settled at about 300,000 units annual, if you are a ‘captain of industry’ in US home lending, you have to be soiling yourself.

        But his B.102 table does point out an anomaly that I’d like to know more about, that is the growth in “Miscellaneous Liabilities” that are quite substantial and provide most of the fuel for his (Stockman’s) argument that the non-financial corporate sector is not deleveraging so much (imo from an MMT perspective, the NFAs created by the deficits have to be going somewhere, and its NOT going to households). My hunch is that US multi-nationals are booking “imports” as some form of liability and this is how it looks on paper….but I’m not sure….it does not indicate that they are issuing typical “Credit Market Instruments” in any case.

        Resp,

  3. Does anybody else find it ironic that this guy who is railing against “debt” is the very same guy who took a proud automotive company, Collins and Aikman, and levered it to the moon with “debt”, driving it to its subsequent liquidation?

  4. As to Tom’s point about the evil, rent-seeking bourgeoisie, I wonder if he has considered the evil, rent-seeking proletariat who acquire desperately needed trade skills and then charge exorbitant rents to the bourgeoisie to engage them.
    When you start talking about ‘rent-seeking’ outside of real estate (or “resources” as Wolf termed it last month), you’re taking your eye off the ball (as neo-classical economists are wont to do).
    http://blogs.ft.com/martin-wolf-exchange/2010/07/12/why-were-resources-expunged-from-neo-classical-economics/

    Doctors go through an absurdly long training regime. In fact, my kid sister is taking her medical boards today, after studying for months– this is after completing her residency program, all three levels of the USMLE exam, and of course graduating from medical school and college). Doctors cost a lot to hire and to train (and should be paid by Medicare anyway). On the other hand, its hard to imagine a more socially beneficial occupation. In contrast, I’ll quote Churchill’s wonderful description of landlords

    Roads are made, streets are made, railway services are improved, electric light turns night into day, electric trams glide swiftly to and fro, water is brought from reservoirs a hundred miles off in the mountains — and all the while the landlord sits still. Every one of those improvements is effected by the labour and at the cost of other people… To not one of those improvements does the land monopolist as a land monopolist contribute, and yet by every one of them the value of his land is sensibly enhanced. He renders no service to the community, he contributes nothing to the general welfare; he contributes nothing even to the process from which his own enrichment is derived.
    http://www.cooperativeindividualism.org/churchill_peoples_rights.html
    Now THAT’S rent seeking. :o)

    1. Perhaps the landlord bought a decaying property, tore it down, built a beautiful house with his own labor and now tends to the maintenance diligently. Is he now a rentier because he lets strangers live in the property and enjoy it and yet collects a monthly rent from them? How is this different from investing years of labor and money into becoming a doctor or an engineer?

      Being a landlord is a job, not fundamentally different from any other. That was the point of my examples. Return on investment can come from many different types of investment — sometimes it is improved land, sometimes capital equipment, sometimes intangible goodwill, and sometimes personal skill or reputation. It is legitimate to monetize these investments. It is not logical to call one a parasite rentier and the other a “salt-of-the-earth” producer.

      This calls to mind a poignant joke. Q. What do you call a person who came in dead last in his medical school class? A. Doctor.

      Don’t get me wrong. I have nothing against doctors. But there are overpaid doctors and underpaid doctors, just as there are overpaid landlords and underpaid landlords, and overpaid and underpaid everything else.

      1. I’m with you on this one ESM; seems like a whitewash to me. Did the rentier sequester the money gained from rents, removing it from the economy? Is it being said that nothing was put back in to the economy? Perhaps the only thing I see here is that there isn’t any self-employment tax on rental income. What question can be raised aside from what the rentier does with their income? Now, if we’re talking a rent monopoly, that’s a different basket of fish.

      2. What do you mean by “rent” and “rentier”?

        The discussion here is about the technical meaning of “economic rent” (land rent, monopoly rent, and financial rent) and those who live from it.

      3. My point is that it is a distinction without a difference. What you call a rentier may not be a rentier. What you think of as somebody earning income through labor or creativity may in fact be a rentier.

        Is Alex Rodriguez a rentier, or Lebron James?

        Is somebody who had the foresight to develop a strip of a property out in the Nevada desert a rentier? Even though he took a big risk and expended a lot of effort in marketing that strip of land in order to increase its value?

        Sure, windfalls can happen, as they can happen in any area of the economy. And bad luck happens too. You might strike oil on your land, or you might find that it is right over a radon deposit or an ancient Indian burial ground. Sometimes government action increases the value of your land, sometimes it decreases it.

        I’m sorry, but when I read terms like “rentier” I think of Marxism. And I think most of Marxism is just nonsense.

      4. ESM, the examples you give have to do with the changes in the value of property. The concept of land rent and appropriate taxation of it is that land (independently of productive additions) has value in and of itself due to its scarcity and location, and this value that does not not accrue from the owners’ productive contribution should be taxed separately. This is not done in most countries.

        I’ll play the devil’s advocate, too. Most conservative take it an article of faith that there is an absolute distinction between people that are productive and people that not. Of course, the devil in is the details of defining “productive.” Is a person productive that sits around and collects disability that has been injured on the job? Is a person productive that inherits a lot of money and lives at leisure on the interest? Are the clergy productive? Are criminals productive, including those who perpetrate their crimes but can’t be hold to account due to their privileged position?

        The example of someone who is prescient and invests wisely in land that will be developed ( a lot of insiders manage to do this) is certainly entitled to the increase in the land’s value. However, the land’s value should also be taxed at the increased value. The land tax is on the land “rent,” i.e., the increase in value through the productivity of people other than the owner, like the laying of public roads and building of schools, the running in of electricity, water, sewers, telephone, and so forth,.

        The land rent is the same on raw land as land with houses or buildings on it. They are the result of productive contribution and taxed differently under the concept of taxing land rent.

        The concept of “rentier” stems from the landed aristocracy and tenant farmers that worked the land and paid rent on it, from which the lord of the manor lived in luxury while the tenants were allotted a subsistence wage. Classical economics was developed in reaction to this feudal system of land ownership and tenancy that was still dominant economically in England and on the Continent at the time.

        Marx picked up and developed that concept of “rentier,” distinguishing various forms of economic rent. BTW, many Post Keynesians regard Marx as a forerunner and they have picked on and elaborated many of his insights. Marx has a bad rep owing to the politics, but he made some insightful contributions to economics that still have relevance.

        Hereis an examination of the term “rentier” from Gerald Epstein’s Here. Hudson, too, is chiefly interested in financialization, although he considers all froms of economic rent unproductive, hence, parasitical. Hudson is really keen on distinguishing between the productive and non-productive, and it is concerned that presently the unproductive is gaining leverage over the productive in the world economy, especially though financialization. This is also anti-democratic since the people making major decisions and setting policy affecting just about everybody are unelected and unaccountable.

      5. “Perhaps the landlord bought a decaying property, tore it down, built a beautiful house with his own labor and now tends to the maintenance diligently. Is he now a rentier because he lets strangers live in the property and enjoy it and yet collects a monthly rent from them?”

        This is not an example of land rent. You are arguing against a straw man.

      6. Thanks for making this important point Tom. A land value tax does not tax improvements such as new structures, nor the capital or labor used to make the improvements.

      7. Sorry, but I looked at the links that you and Beowulf provided, and I still think that the distinction you (and some of the others) make between land and other types of capital to be illogical. The only difference I can see between land and other types of capital (including intangible capital) is that land is immobile, so it is somewhat more efficient to tax.

      8. Wikipedia has a pretty good summary of the land value tax, the historical roots, and the issues surrounding it here.

    2. Beowulf’s quote of Churchill: “To not one of those improvements does the land monopolist as a land monopolist contribute, and yet by every one of them the value of his land is sensibly enhanced. He renders no service to the community, he contributes nothing to the general welfare; he contributes nothing even to the process from which his own enrichment is derived..”

      Exactly. See MIchael Hudson’s advice to China on taxing land rent on this basis here. It’s short and very much worth the read.

      Hudson agrees that RE construction is entrepreneurial, contributive, and deserving of appropriate reward proportional to its productive contribution. He contrasts this with the increase in value of land (and rent chargeable for its use) based on productive improvements made by others, as Churchill notes. This is the basis of land rentierism. It’s classic getting something (actually a whole lot) for nothing.

      He examines financial rentierism in From Marx to Goldman Sachs: The Fictions of Fictitious Capital. It’s longer, but a dynamite article, IMHO.

      1. Thanks for the Michael Hudson links. He’s certainly an interesting writer. I understand he’s a consultant to the Latvian govt assist in their post-crash economic reforms. I know he’s been an economic adviser to Dennis Kucinich in the past (and perhaps currently for all I know).

        I wonder if Hudson, like Kucinich, has come down on the side of the American Monetary Institute’s (AMI) 100% reserve banking proposal or if his preferred monetary reforms are more like MMT. For his part, Kucinich came about affiliation with AMI honestly, I believe he met his now-wife while she was working there. :o)
        http://ouramericanmoney.blogspot.com/2009/05/kucinich-reportedly-drafting-monetary.html

      2. I don’t know how closely Hudson is associated with AMI and their work, but he is speaking at their September conference and he has endorsed Stephen Zarlenga’s Lost Science of Money.

        The 6th Annual AMI Monetary Reform Conference will be held at the University Center, in Chicago, Sept. 30 – Oct. 3, 2010. While 2010 speakers are still unconfirmed, past speakers have included: Prof. Michael Hudson, Richard C. Cook, William K. Black, Dennis Kucinich and wife Elizabeth

        Dr. Michael Hudson wrote:
        “The history of money is critical to understanding the greatest problem the third millennium will face. Stephen Zarlenga’s Lost Science of Money book provides the needed background for seeing the basic structural issues at work.”

      3. Oops. I mistakenly wrote that Hudson was speaking at the AMI conference this year. He has appeared there in the past, but the speakers for this year are unconfirmed.

    3. By the way, just cause I’m bored, I’ll play devil’s advocate on another point.

      About doctors, Beowulf wrote:

      “On the other hand, its hard to imagine a more socially beneficial occupation…”

      It’s not hard for me. Why is a doctor any more socially beneficial than a farmer, a computer programmer, a taxi cab driver, an author, or a hair stylist (notice, I didn’t put lawyer on my list! — that’s a joke actually). On the contrary, there are very few doctors who are as socially beneficial as a great writer, or a great athlete, or a great actor. Unfortunately, it is difficult to leverage a doctor’s skills in order to bring comfort and happiness to millions of people, but it is possible in those other professions. But otherwise, there is nothing special about being a doctor. It is a job which pays pretty well, and it comes with a few extra perqs (enhanced social status being one of them, the ability to prescribe your own medication being another), but it is not that different from lots of other jobs.

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