#DeleteKeynes #ExpelAllKeynesians

Comment on Asad Zaman on ‘Methodology of Modern Economics’

Blog-Reference

• The formal basis of the General Theory is given with “Income = value of output = consumption + investment. Saving = income − consumption. Therefore saving = investment.” (p. 63)

• This proposition is conceptually/logically false because Keynes NEVER came to grips with profit.

• Because the foundational economic concepts of profit/income/saving are misspecified, the whole theoretical superstructure of Keynesianism in all its variants is false.

• Keynes messed up the inexorable Paradigm Shift from microfoundations to macrofoundations.

• Keynes was an agenda pusher, NOT a scientist. Keynesian policy guidance has NO sound scientific foundations and, in effect, enables the self-alimentation of the Oligarchy.

• The extremely unequal distribution of income and financial wealth is the direct result of public deficit spending. It holds Public Deficit = Private Profit.

• After-Keynesians have not detected/rectified Keynes’s blunders to this day. Macroeconomics ― profit and employment theory, in particular ― is materially/formally inconsistent.

• Keynesianism is scientifically worthless. All Keynesians have to be expelled from the sciences.

• The same holds for Walrasians, Marxians, Austrians, and Pluralists.

For details of the big picture, see cross-references Keynesianism

Egmont Kakarot-Handtke

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Graphic AXEC138

Economics, too, is pre-truth

Comment on David Ruccio on ‘Socialism or truth’

Blog-Reference and Blog-Reference

David Ruccio echoes the newest post-truth slogans: “Every day, it seems, one or another liberal ― pundit, columnist, or scholar ― issues a warning that, in the age of Donald Trump, we now live in a post-truth world. In their view, we face a fundamental choice: either return to a singular, capital-t truth or suffer the consequences of multiple sets of beliefs, facts, and truths.” This, though, is not such a big concern for David Ruccio: “Me, I’ll take socialism over truth any day.”

First of all, the idiocy of the post-truth blather consists of the tacit implication that there was a period in human history where truth prevailed. This neither holds for the near nor the remote past. “We” still do not have the historical truth about the Kennedy assassination and “we” never had the historical truth about figures like Jesus/Mohamed/Solomon and their teachings. What “we” have since 2000+ years is story-telling/literary fiction/propaganda/forgeries/False-Hero-Memorials. Roughly the same holds for profane history. Herodotus, to recall, was not only called the ‘The Father of History’ but also ‘The Father of Lies’.

The exception to perennial storytelling is, of course, science. Scientific truth is well-defined by material and formal consistency and is established by rigorous proof. The fact is, however, that the brains of about 99 percent of any population have zero scientific content which means that societies are firmly at the pre-truth stage. In this respect, nothing has changed with Mr. Trump and therefore it is plain idiocy to announce a post-truth era.

This holds in any case for economics. After 200+ years, economists still do not have the true theory. Economics is not a science but what Feynman called a cargo cult science. The four main approaches ― Walrasianism, Keynesianism, Marxianism, Austrianism ― are mutually contradictory, axiomatically false, materially/formally inconsistent, and all got profit ― the pivotal concept of the subject matter ― wrong. With the pluralism of provably false theories, economics is at the pre-truth = proto-scientific stage.

Since Adam Smith/Karl Marx, economic policy guidance NEVER had sound scientific foundations. This holds for capitalism and communism and everything in between. The scientific truth-value of economics is zero.

The truth about economics is:

• Economics is axiomatically false, that is, Walrasian microfoundations and Keynesian macrofoundations are materially/formally inconsistent.
• Because the axioms are false the whole analytical superstructure is false.
• Economists do to this day not know what profit is.
• Economists do not understand how the economic system, i.e. the price- and profit mechanism, works.
• Economists fail to realize that the market economy is NOT self-correcting/self-adjusting but inherently unstable.

To this day, economists are NOT committed to scientific truth but to political agenda-pushing.#1 For them, post-truth and pre-truth are a matter of indifference, they simply keep on telling the same brain-dead stories about capitalism and communism. They do not know the difference between writing a wishlist#3 and scientific research.#4 Neither orthodox nor heterodox economists know how the economy works. They are even too stupid for the elementary mathematics of National Accounting.#5 For the time being, economics and truth cannot be mentioned in the same breath.

Egmont Kakarot-Handtke


#1 There is no truth in political economics and Economics and truth and Pre-truth and post-truth in economics and Economics is not post-truth but pre-truth
#2: For details of the big picture see cross-references Political Economics
#3 “… we want to build a world where everyone has a right to food, healthcare, a good home, an enriching education, and a union job that pays well. We think this kind of economic security is necessary for people to live rich and creative lives — and to be truly free. We want to guarantee all of this while stopping climate change and building an economy that’s ecologically sustainable. We want to build a world without war, where people in other countries are free from the fear of US military intervention and economic exploitation. And we want to end mass incarceration and police brutality, gender violence, intolerance towards queer people, job and housing discrimination, deportations, and all other forms of oppression.”
#4 How the Intelligent Non-Economist Can Refute Every Economist Hands Down
#5 Wikipedia and the promotion of economists’ idiotism (II)

Related 'Links on capital-T Truth, stupidity, corruption'.

How Keynesians, Lernerians, MMTers make the Oligarchy great

Comment on Lars Syll on ‘Rethinking public budget’

Blog-Reference and Blog-Reference and Blog-Reference on Aug 9

Lars Syll summarizes: “Few issues in politics and economics are nowadays more discussed ― and less understood ― than public debt. … The pros and cons of public debt have been put forward for as long as the phenomenon itself has existed, but it has, notwithstanding that, not been possible to reach anything close to consensus on the issue ― at least not in a long time-horizon perspective.”

True, after 200+ years, economics is still at the proto-scientific level. Both orthodox and heterodox economists have failed. Economists do not know to this day how the price and profit mechanism works. The reason is simple: economists are incompetent scientists. To this day, they do not know what profit is, and therefore, they collectively talk mind-blowing nonsense about deficit spending/money creation/public debt.

To make matters short, the axiomatically correct macroeconomic Profit Law for an evolving economy is given here without further explanation. It holds, with Q_m monetary profit/loss, S_m monetary saving/dissaving, I investment expenditures, G government spending, T taxes, X export, M import, Y_d distributed profit Q_m≡Y_d+(X−M)+(G−T)+(I−S_m) in the open economy with distributed profit.

This reduces to Public Deficit = Private Profit, i.e., Q_m≡(G−T). And this, in turn, gives the following simplified credit cycle: (i) Public deficit spending → profit of the business sector up, (ii) profit distribution to the one-percenters up, (iii) one-percenters buy bonds, (iv) ninety-nine-percenters get taxed, taxes are transferred in the form of interest to the one-percenters for the duration of the bonds, (v) old bonds are replaced by new bonds on maturity, (vi) steps (iv) and (v) are repeated for an indefinite time, (vi) Eventual redemption of bonds requires taxation of the ninety-nine-percenters and transfer to the one-percenters. The business sector makes a loss.

From this stylized credit cycle follows immediately Lerner’s dictum: “Very few economists need to be reminded that if our children or grandchildren repay some of the national debt, these payments will be made to our children or grandchildren and to nobody else. Taking them all together, they will no more be impoverished by making the repayments than they will be enriched by receiving them.” This is one of the worst deceptions economists have put on the ninety-nine percenters.

MMTers are presently the most enthusiastic champions of deficit-spending/money-creation. It holds:#1

(i) The macroeconomic foundations of MMT are provably false. More specifically, the MMT balances equation is proto-scientific garbage. This also holds for Post-Keynesianism.

(ii) Because of (i), the whole analytical superstructure of MMT is false.

(iii) Because MMT policy guidance boils down to deficit-spending/money-creation, MMT policy directly and immediately increases macroeconomic profit. Effects on employment/prices are uncertain and secondary.

(iv) Because of (iii), MMTers are the naturally useful idiots of the one-percenters.

(v) The MMT sales crowd promotes an economic theory, which has been definitively falsified, in social media and in the econblogosphere by pretending that MMT policy is for the benefit of the ninety-nine percenters.

(vi) MMT academics do NOT promote science but provide a cover for the agenda of the one-percenters.

(vii) The observable unequal distribution of income and financial wealth is the empirical proof (a) of the axiomatically correct Profit Law, and (b) that the deficit-agenda-pushing from Keynes to Lerner to MMT and to Lars Syll has been very successful.

(viii) MMT is the easily recognizable tip of the iceberg of political corruption of economics.

Egmont Kakarot-Handtke


#1 For the full-spectrum refutation of MMT, see cross-references MMT

Related 'Keynes, Lerner, MMT, Trump, Biden, and exploding profit' and 'Keynesianism as ultimate profit machine' and 'Too much ado about deficit spending' and 'MMT-Refutation for Dummies' and 'Orthodoxy is refuted ― but MMT also'.

For more about Oligarchy see AXECquery.

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Graphic AXEC168

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YouTube Mar 22, 2023 Evidence: US is not a democracy | Princeton University study

The UNZ Review Apr 4, 2023 “And that’s why Aristotle said that many constitutions of the Greek states claim to be democratic, but they were really oligarchic.” (Michael Hudson)

INET, Dec 19, 2023, Lynn Parramore, Renowned Political Scientist: Can We Really Save American Democracy?

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Twitter Apr 27, 2023 Study: US is an oligarchy, not a democracy

Twitter/X Feb13, 2026  Nowadays, entrepreneurs are created by the Oligarchy

Debunking MMT in one Counter-Tweet

Comment on Brad DeLong on ‘SUNDAY MORNING TWITTER: FUNCTIONAL FINANCE/A BETTER WORLD IS POSSIBLE TWEETING...’

Blog-Reference and Blog-Reference

(i) The macroeconomic foundations of MMT are provably false. More specifically, the MMT sectoral balances equation is proto-scientific garbage.#1

(ii) Because of (i), the whole analytical superstructure of MMT is false.

(iii) Because of (ii), MMT is scientifically worthless.

(iv) Since the founding fathers, in economics, a theory need NOT be true according to well-defined scientific criteria but only politically useful. Economics started as Political Economy and is a cargo cult science since then.

(v) According to the axiomatically correct macroeconomic Profit Law, it holds that Public Deficit = Private Profit.

(vi) Because all MMT policy guidance boils down to deficit-spending/money-creation, MMT policy directly and immediately increases macroeconomic profit. Effects on employment/ prices are uncertain and secondary.

(vii) Because of (vi), MMTers are the natural useful idiots of the one-percenters.

(viii) The MMT sales crowd promotes an economic theory that is definitively falsified according to the scientific criteria of material/formal consistency in the social media and in the econblogosphere by pretending that MMT policy is for the benefit of the ninety-nine percenters.

(ix) MMT academics do NOT promote science but provide a cover for the agenda of the one-percenters.

(x) MMT academics suppress critique/refutation of MMT on their blogs and on Twitter.

(xi) The observable unequal distribution of income and financial wealth is the empirical proof (a) of the axiomatically correct Profit Law, and (b) that the deficit-agenda-pushing from Keynes to Lerner to MMT to Trump has been very successful.

(xii) MMT is the easily recognizable tip of the iceberg of political corruption of economics.

(xiii) Brad DeLong’s BETTER WORLD IS POSSIBLE TWEETING does NOT originate from the Republic of Plato but from the Sewer of Romulus and reminds everybody that the internet could, as far as economics is concerned, be an intellectual force multiplier but is actually “a hive of scum and villainy...” (DeLong)

Egmont Kakarot-Handtke


#1 For details of the big picture, see cross-references MMT

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AXEC142

Economics: Math is NOT the problem, scientific incompetence is

Comment on David Ruccio on ‘Utopia and mathematics’

Blog-Reference

Economists fall into two groups: those who apply math and those who don’t. Both have failed. After 200+ years, economics is still at the proto-scientific level.

The fact is that economists have messed up
• profit theory, for 200+ years,
• microfoundations, for 150+ years,
• macrofoundations, for 80+ years,
• the application of elementary logic and mathematics since the founding fathers.

To this day, neither orthodox nor heterodox economists have developed the true (= materially/formally consistent) theory. More precisely, economists do not know how the price and profit mechanism works and whether the monetary economy is inherently stable/unstable. The four main approaches ― Walrasianism, Keynesianism, Marxianism, Austrianism ― are mutually contradictory, axiomatically false, materially/formally inconsistent, and all got the foundational concept of the subject matter ― profit ― wrong. What has been achieved is the pluralism of provably false theories.

Heterodoxy does not get tired of pointing out that Orthodoxy misapplies math. This, of course, is true. But this cannot obscure the fact that heterodox storytelling, too, has NOT achieved anything of scientific value.

The fact of the matter is that both orthodox and heterodox economists are too stupid to even understand the elementary mathematics that underlies National Accounting. #1, #2, #3 Because economists failed already at the first rung of the mathematical ladder, they never could get out of their dark proto-scientific hole and beyond brain-dead political blather.

Both orthodox and heterodox economists are responsible for the worst embarrassment in the history of modern science, and both have to be expelled from the sciences.#4, #5

Egmont Kakarot-Handtke


#1 Economists: just too stupid for counting
#2 For details of the big picture, see cross-references Accounting and cross-references Math/Mathiness
#3 Hooray! The formalization issue is finally settled
#4 Lying for money: a generalization
#5 Throw them out! Orthodox and heterodox economists are unfit for science

Related 'MMTers: too stupid for simple math' and 'Economics, math, pluralism, and corruption' and '“But economics is not pure mathematics or logic” No, it is pure blather'

For more about math, see AXECquery.

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AXEC121i

The MMT-Yawner: Government is not a household

Comment on Bill Mitchell on ‘The government is not a household and imports are still a benefit’

Blog-Reference

Everybody got the MMT meme by now. Unfortunately, neither MMT academics nor the social media sales force ever understood its full implications.

It is trivially true that “… a government is not a household. It has a wider remit (objectives) than a household and must consider a broad range of concerns when it uses its currency-issuing capacity to shift real resources (as goods and services) from the non-government sector to the government sector to fulfill its elected mandate.” (Mitchell)

The problem comes in with the ‘use of currency-issuing capacity’ because there is, as always, good and bad use of a capacity. It is trivially true that Organized Crime, in the definition of the Organized Crime Control Act OC≅OCCA has the capacity to print money and ‘to shift real resources (as goods and services) from the non-government sector to the OC≅OCCA sector.’

So, from the currency-issuing capacity of the government does NOT follow that it is a good policy to resort to deficit-spending/money-creation. In fact, it is a bad policy. Translated into MMT jargon: government is NOT a household, but it is NOT a counterfeiter either.

The crucial distinction is this. The correct way to bring additional fiat money into circulation is to finance a growing wage bill. The incorrect way is to spend the additional money on goods and services, i.e., current output. This is analogous to going on a shopping spree with counterfeit money.

The first thing to grasp is: it is the household sector that pays in real terms in the form of a tiny price hike, which is indistinguishable from a random price fluctuation. A government that resorts to deficit-spending/money-creation does NOT “fulfill its elected mandate” but in effect applies stealth taxation to the household sector.

The second thing to grasp is that because of the macroeconomic Profit Law, i.e., Public Deficit = Private Profit, deficit-spending/money-creation increases macroeconomic profit by exactly the same amount.

The correct way for the central bank to inject out-of-thin-air money into the economy is by financing a growing wage bill. The incorrect way is the counterfeit-money-printers' way. #1, #2

True, the government is not a household. But equally true, the government is not OC≅OCCA either. Why Bill Mitchell claims that by deficit-spending/money-creation government fulfills its “elected mandate” is anybody’s guess.

Egmont Kakarot-Handtke


#1 Keynes, Lerner, MMT, Trump and exploding profit
#2 The Kelton-Fraud

Related 'Criminals and the monetary order'.

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AXEC143d  Macroeconomic Profit Law for an increasing number of sectors, which implies Public Deficit (G−T) = Private Profit Q_m

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REPLY to ANC Driver on Aug 5

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This covers all publications/blog posts, in particular
AXEC
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AXEC142

Lying for money: a generalization

Comment on Chris Dillow on ‘LYING FOR MONEY: A REVIEW’

Blog-Reference and Blog-Reference

Chris Dillow discusses Dan Davies’ history of fraud: “Dan has also a theory of fraud. Also, perhaps we can extend Dan’s work. He discusses outright criminal fraud. But there are similar types of behaviour which are legal ― such as selling snake oil in 19th century America.”

There are not only similar types of behavior that are legal, but which are even honored with the “Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel”. #1

The situation of economics is this: “In order to tell the politicians and practitioners something about causes and best means, the economist needs the true theory or else he has not much more to offer than educated common sense or his personal opinion.” (Stigum)

The fact of the matter is that economists do NOT have the true theory. More precisely, economists do not know how the price and profit mechanism works. The four main approaches ― Walrasianism, Keynesianism, Marxianism, Austrianism ― are mutually contradictory, axiomatically false, materially/formally inconsistent, and all got the foundational concept of the subject matter ― profit ― wrong. With the pluralism of provably false theories, economics sits squarely at the proto-scientific level. #2

The fact is that economics claims to be a science, but is what Feynman called a cargo cult science: “They’re doing everything right. The form is perfect. ... But it doesn’t work. ... So I call these things cargo cult science because they follow all the apparent precepts and forms of scientific investigation, but they’re missing something essential.”

Economists ignore/violate scientific standards. Or, as Blaug put it, they are playing tennis with the net down. Morgenstern reminded his fellow economists back in 1941: “In economics we should strive to proceed, wherever we can, exactly according to the standards of the other, more advanced, sciences, where it is not possible, once an issue has been decided, to continue to write about it as if nothing had happened.”

Economics is scientifically unacceptable since Adam Smith/Karl Marx, but all factions recycle their stuff with minor cosmetic corrections “as if nothing had happened”. #3

Economics is a failed/fake science because economists (i) are scientifically incompetent, (ii) violate scientific standards/ethics, and (iii) deceive the general public on a regular basis. #4, #5, #6

Since the founding fathers, economic policy guidance has never had valid scientific foundations. To this day, economists push their respective political agendas in the bluff package of science.

Egmont Kakarot-Handtke


#1 The real problem with the economics Nobel
#2 Economics: 200+ years of scientific incompetence and fraud
#3 New Economic Thinking, or, let’s put lipstick on the dead pig
#4 The father of modern economics and his imbecile kids
#5 The Kelton-Fraud
#6 MMT: Academic snake oil for the people

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AXEC106l