November 14, 2018

Keynes, Kalecki, MMT, and the accidental invention of the perpetual profit machine

Comment on Lars Syll on ‘Kalecki on wage-led growth’


Like Keynes, Kalecki got profit wrong. Lars Syll and the rest of retarded After-Keynesians have not realized anything to this day.#1

Keynes defined the formal foundations of the General Theory as follows: “Income = value of output = consumption + investment. Saving = income − consumption. Therefore saving = investment.” (p. 63) This elementary syllogism is conceptually and logically defective because Keynes never came to grips with profit. (Tómasson et. al)

The elementary version of the axiomatically correct macroeconomic Profit Law, which is measurable with the precision of two decimal places, reads Qm≡I−Sm with Qm as monetary profit of the business sector and Sm as monetary saving of the household sector. And this means that since Keynes/Hicks all I=S/IS-LM models are false.

Keynesian macroeconomics is proto-scientific garbage. Because the profit theory is false, the rest is false including, of course, employment theory and the theory of money.#2

Kalecki’s profit theory is not any better.#3, #4 And therefore, his employment theory, too, is provably false.

The axiomatically correct employment theory tells one that overall employment INCREASES if the average wage rate W INCREASES relative to average price P and productivity R. So, there are two policy levers and what has to be done is to combine demand-led and wage-led expansion in order to get out of unemployment.

The post-Keynesian preoccupation with demand is ultimately counterproductive because each increase in deficit spending increases macroeconomic profit. From the axiomatically correct macroeconomic Profit Law Qm≡(I−Sm)+(G−T)+(X−M)+Yd follows inter alia Public Deficit = Private Profit.#5

Keynes, Kalecki, MMTers, and Lars Syll are seen as Progressives who promote policies that benefit WeThePeople. This is just one more propaganda swindle in the long history of political economics. These fake Progressives have never done anything else than push the agenda of the Oligarchy. After all, this is what all economists do since Adam Smith/Karl Marx.#6, #7

Egmont Kakarot-Handtke

#1 Demand-led and wage-led growth
#2 Keynes’ Employment Function and the Gratuitous Phillips Curve Disaster
#3 Truth by definition? The Profit Theory is axiomatically false for 200+ years
#4 What is Wrong with Heterodox Economics? Kalecki’s Profit Theory as an Example
#5 Keynes, Lerner, MMT, Trump, Biden, and exploding profit
#6 Mission impossible: economists join WeThePeople
#7 Why do workers not tar and feather economists?

Related 'Keynesianism as ultimate profit machine' and 'It’s the price and profit mechanism, stupid!'.

For details of the big picture see cross-references Profit and cross-references Employment.


Wikimedia AXEC145 The public-deficit component of the macrofounded Profit Law