July 30, 2020

Economics as thought-reading and motive-imputation

Comment on Magpie on ‘So, I Actually Hate the JG, Who Knew?’


Tom Hickey summarizes,  “My view, and that of Marxian economist Chris Dillow as I recall, is that the transition to socialism will happen through the intermediary step of social democracy, leading eventually to democratic socialism. This is what the ruling elite are afraid of, and it is why they are so opposed to social democracy.”

This summary encapsulates the humongous idiocy of the representative economist. He does not know how the economy works but knows “what the ruling elite are afraid of”. He cannot get the elementary algebra of national accounting right, but he can read the thoughts of an unknown number of unknown people called the elite. Is this elite composed of the descendants of old European aristocracy or the members of organized crime or random folks on the payroll of the Oligarchy? Is Mr. Trump a member of the elite or merely the fall guy for the breakdown of the USA? We don't really know. And these ignoramuses tell us how history will eventually lead to democratic socialism.

How can they know this? Because Marx and Engels said so. The simple fact of the matter is that the two political agenda pushers never understood how the monetary economy works.#1 Neither did their mentally retarded followers to this very day.

Here are the basics. The elementary production-consumption economy is defined with this set of macroeconomic axioms: (A0) The economy consists of the household and the business sector which, in turn, consists initially of one giant fully integrated firm. (A1) Yw=WL wage income Yw is equal to wage rate W times working hours. L, (A2) O=RL output O is equal to productivity R times working hours L, (A3) C=PX consumption expenditure C is equal to price P times quantity bought/sold X.

Under the conditions of market-clearing X=O and budget-balancing C=Yw in each period, the price as the dependent variable is given by P=W/R (1a). The price is determined by the wage rate W, which takes the role of the nominal numéraire, and the productivity R.

The macroeconomic Law of Supply and Demand (1a) implies W/P=R (1b), i.e. the real wage is always equal to the productivity no matter how the wage rate W is set or how long the individual or aggregate working time L is. Full employment is possible, the workers always get the whole product O. The workers' living standard/freedom depends ultimately on the productivity.

The condition of budget balancing, i.e. C=Yw, is now skipped. The monetary saving/dissaving of the household sector is defined as S≡Yw−C. The monetary profit/loss of the business sector is defined as Q≡C−Yw. Ergo Q≡−S.

The mirror image of household sector dissaving (-S) is business sector profit Q. The workers as a group still get the whole product. There is, however, a redistribution of output O between the workers.

The Profit Law holds for the monetary economy as given by the macroeconomic axiom set, that is, for Capitalism and Communism and everything in-between. Macroeconomic profit does NOT depend on the ownership of the means of production.

Profit depends on the deficit-spending of the household sector and the state sector.#2 In late capitalism, the business sector fully depends on the state for its survival. What the Oligarchy must fear most is NOT the proletariat but a balanced budget of the state sector. To postpone this calamity is the task of the MMT troll army.

Dear left/center/right economists, time to learn economics.#3

Egmont Kakarot-Handtke


#1 Links on Karl Marx
#2 Profit

July 29, 2020

Economics is a disgrace

Comment on Claudia Sahm on ‘Economics is a disgrace’*


Economics is an institution and a science. Claudia Sahm gives a personal summary of the toxic institutional culture, “We hurt economists from undergraduate classrooms to offices at the White House. We drive away talent; we mistreat those who stay; and we tolerate bad behavior.” So, economics is a failed institution, “Burn it down”.

Being not a part of this institution, I am not entitled to comment on it.

The all-decisive point about economics is not human failure but scientific failure. Walrasianism, Keynesianism, Marxianism, Austrianism, MMT, and Pluralism are materially/ formally inconsistent and therefore scientifically worthless.#1

The blunder is, with regard to the subject matter, at the axiomatic level and with regard to formal consistency at the level of elementary algebra.

Microfoundations are false since 150+ years. Macrofoundations are false since Keynes. Economists did not spot Keynes' foundational blunder to this day.

THIS is the indelible disgrace of economics.#2 The mistreatment of students/colleagues is bad, the mistreatment of science is worse. Institutional failure is bad, scientific failure is worse.

Egmont Kakarot-Handtke


#1 Section Exemplary proof of the inconsistency of economics in Wikipedia, economics, scientific knowledge, or political agenda pushing?
#2 See Ch. 13, The indelible scientific disgrace of economics, in Sovereign Economics, BoD

***
Wikimedia AXEC106k

July 27, 2020

That’s wrong with a fiscal deficit

Comment on Prabhat Patnaik on ‘What could be wrong with a fiscal deficit? ’

Blog-Reference

Prabhat Patnaik resumes “And here, the real point to note is the following. The claims that capitalists hold against the government because of the fiscal deficit have been put into their hands by the fiscal deficit itself.”

Yes, that’s exactly what the macroeconomic Profit Law implies, i.e. Public Deficit = Private Profit.#1-#3 Consequently, the Financial Wealth of the Oligarchy ≈ Public Debt of WeThePeople. The sign ≈ indicates that some other factors play a role that can be left out of the picture here.

This, however, is only the first move in the distribution game. The Oligarchy gets interests on the public debt which is taxed from WeThePeople as long the debt is rolled over. The taxman makes sure since time immemorial that interests are paid on time.

The policy of deficit-spending/money-creation is the mechanism for the perpetual and progressive self-alimentation of the Oligarchy. Financial wealth grows in lockstep with public debt. Mr. Trump’s current policy will blow up macroeconomic profit to hitherto unimaginable proportions no matter whether unemployment falls or rises. This, after all, is why the Oligarchy put him into office in the first place.

MMTers sell the biggest Ponzi scheme of all time as a good deed for the benefit of WeThePeople. Academic economists are already for a long time part of the scam.#4

That’s wrong with a fiscal deficit: it is a political and scientific fraud. Economists will go to the scientific equivalent of hell for this. Except for Prabhat Patnaik, of course.#5

Egmont Kakarot-Handtke


#1 Profit
#2 Cross-references Profit
#3 The Profit Law, Wikimedia AXEC143d
#4 Keynes, Lerner, MMT, Trump, etc. and exploding profit
#5 Your economics is refuted on all counts: here is the real thing

Related 'Why MMTers permanently explode 'myths of public deficits'' and 'Q: How are you going to pay for it? MMT: By stealth taxation!' and 'Criminals and the monetary order' and 'The decisive reason to worry about government debt' and 'No MMT illusions! YOU are going to pay for it' and 'How to pay for the war and to be bamboozled by economists'.

The U.S. economy hangs on the state ventilator for its survival

Comment on Nathan Tankus on ‘Where do profits come from?’* and Barkley Rosser on ‘Donald Trump's Only Chance’

Blog-Reference

Macroeconomic profit is not made from a longer labor time, not from higher productivity, not from innovation/creative destruction, not from a lower wage rate, not from more greed, not from exploitation, not from monopoly power, not from risk-taking, not from rent-seeking, not from profit maximization or any other subjective factor, but in the most elementary case of the production-consumption economy from the dissaving/deficit spending of the household sector, i.e. Qm≡−Sm. Starting with a balanced-budget economy, macroeconomic profit presupposes credit/money creation by the banking sector (central bank and commercial banks). Macroeconomic profit has nothing to do with property rights. The Profit Law holds for capitalism and communism.

Accordingly, microeconomic profit is the result of the continuous redistribution of macroeconomic profit between the firms that constitute the business sector. If macroeconomic profit is zero, i.e. if the household sector's budget is balanced, then the sum of microeconomic profits is equal to the sum of microeconomic losses.

In the elementary production-consumption economy with a state sector, macroeconomic profit comes ultimately from the household and state sector’s deficit spending/money creation, i.e. Qm≡(G−T)−Sm.#1-#6

This means that the greater part of the profit in the United States is actually produced by the state. The U.S. economy hangs for a long time already on the state ventilator for its survival. The outstanding amount of public debt is a rough metric for the dysfunctionality of the system.

The policy of deficit-spending/money-creation is ultimately a means of postponing the breakdown of the U.S. economy. Deficit-spending/money-creation is a free lunch for the Oligarchy. Financial wealth grows in lockstep with public debt. Mr. Trump’s current policy will blow up macroeconomic profit to hitherto unimaginable proportions. This, after all, is why the Oligarchy put him into office in the first place.

Egmont Kakarot-Handtke


* Notes on the Crises
#1 Profit
#2 The Levy/Kalecki Profit Equation is false
#3 Truth by definition? The Profit Theory is axiomatically false for 200+ years
#4 The profit theory is false since Adam Smith
#5 Cross-references Profit
#6 Wikimedia AXEC143d The Profit Law with growing complexity

July 26, 2020

The question economists could not answer for 200+ years

Comment on Tom Hickey on “Where do profits come from? — Nathan Tankus”

Blog-Reference

Where do profits ultimately come from? Macroeconomic profit is not made from a longer labor time, not from higher productivity, not from innovation/creative destruction, not from a lower wage rate, not from more greed, not from exploitation, not from monopoly power, not from risk-taking, not from rent-seeking, not from wishful thinking or any other subjective factor, but in the most elementary case of the production-consumption economy from the dissaving/deficit spending of the household sector, i.e. Qm≡−Sm. Starting with a balanced-budget economy, macroeconomic profit presupposes credit/money creation by the banking sector (central bank and commercial banks). Macroeconomic profit has nothing to do with property rights. The Profit Law holds for capitalism and communism.

Accordingly, microeconomic profit is the result of the continuous redistribution of macroeconomic profit between the firms that constitute the business sector. If macroeconomic profit is zero, i.e. if the household sector's budget is balanced, then the sum of microeconomic profits is equal to the sum of microeconomic losses.

Macroeconomic profit comes ultimately from the household and state sector’s deficit spending/money creation.#1-#6

Egmont Kakarot-Handtke


#1 Profit
#2 The Levy/Kalecki Profit Equation is false
#3 Truth by definition? The Profit Theory is axiomatically false for 200+ years
#4 The profit theory is false since Adam Smith
#5 Cross-references Profit
#6 The Profit Law, Wikimedia AXEC143d


***
REPLY to NeilW on Jul 27

You ask: “Anybody spotted where Apple's cash pile sits in all this? There's a section for household saving, but none for dead net saving by corporations.”

It's there for all who can read and think.

The distributed profit of the business sector is given by Yd.#1 The difference between profit Qm and distributed profit Yd is retained profit Qre and this is the cash pile the corporations sit on if they don't buy government bonds or other financial assets or reinvest.

Learn economics. I recommend the textbook Sovereign Economics.#2


#1 The Profit Law, Wikimedia AXEC143d
#2 Amazon or BoD


***
Wikimedia AXEC109i

July 24, 2020

MMT ― now official doctrine

Comment on Tom Hickey on ‘A Job Guarantee Costs Far Less Than Unemployment, Pavlina Tcherneva’

Blog-Reference

It has always been clear that MMT is NOT a scientifically valid economic theory but political propaganda for the benefit of the one-percenters.#1 However, MMTers always claimed that their heroic fight was for the benefit of WeThePeople. Tom Hickey, the MMT philosopher, made it quite clear that his mental grandfather was Karl Marx. Same for Bill Mitchell, the MMT chief ideologist.

MMTers placed themselves firmly in the Progressive camp and demonstratively gathered behind the signboard of the Job Guarantee. That’s pro-labor and anti-capitalist, right? Yes, but only for people who have been trained since childhood to believe any crap.

Tom Hickey is very happy to announce that MMT colleague Pavlina Tcherneva is now on Foreign Affairs: “MMT is making it to the top of the list after having been marginalized for decades. Is the elite getting concerned? This is a superb article and it is addressed to the ruling elite, which is the audience of this venue.”

What is Foreign Affairs? Tom Hickey cites Wikipedia: “Foreign Affairs is an American magazine of international relations and U.S. foreign policy published by the Council on Foreign Relations, a nonprofit, nonpartisan, membership organization and think tank specializing in U.S. foreign policy and international affairs.”

In other words, Foreign Affairs tells the Oligarchy's underlings all over the world what the grand policy outline is. The new strategy in order to save the system is deficit-spending/ money-creation. And this is why MMT and its apostles are currently hyped across all media. Stephanie Kelton is No 1 on the NYT bestseller list and Pavlina Tcherneva is on Foreign Affairs. And the Marx pupil Tom Hickey applauds until he runs out of oxygen behind his mask.

Gentle reminder: the MMT policy of deficit-spending/money-creation is NOT and NEVER has been for the benefit of WeThePeople. MMT is the issuance of counterfeit currency in the form of deficit spending/money creation for the benefit of the one-percenters. Because PublicDeficit = PrivateProfit, MMT is the biggest redistribution program ever.#2 MMT is and always has been a political fraud.

That MMT is now promoted by Foreign Affairs is proof of it.


***

REPLY to Matt Franko on Jul 24

Economics is not an ordinary science but sciences: “Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel.”

Or, the classical definition: “Economics is the science which studies human behavior as a relationship between ends and scarce means which have alternative uses.” (Robbins)

Because the science claim is provably false,#1 economists are in fact fraudsters.


#1 Wikipedia, economics, scientific knowledge, or political agenda pushing?

***
REPLY to Tom Hickey on Jul 24

When the folks of the social sciences cannot do real science for some spurious methodological reasons#1 that’s no problem. They can do talk shows or polit-marketing or comedy or social media trolling. What they cannot do is to claim that whatever they do is science and to award themselves Nobel prizes. They can award themselves Oscars for the funniest financial hoax and such things.

There are some minimum requirements for science. One is to realize in seconds, not in years, that 2+2=5 is false. Or, for that matter, that the Keynesian I=S is false.#2 MMTers do not satisfy these requirements. They still don’t get the macroeconomic balances right.#3 That is, they fail at elementary algebra. There is NO methodological excuse for that, ever.

There are also some ethical requirements for science. The first and foremost is not to lie and not to cheat. Another is, not to manipulate the communication. MMTers are big-time #EconBlocker and that is the unassailable proof that they are not scientists but political crooks.

MMT is hyped at the moment because the biggest Ponzi scheme of all time has to be sold as an employment program and academically blessed.

People trust science. What they don’t know is that economics in general and MMT, in particular, is fake science.#4


#1 How incompetent are economic methodologists? Very!
#2 Cross-references Refutation of I=S
#3 Profit
#4 Trust in science? Yes, but economics is NOT a science


***
REPLY to Tom Hickey on Jul 25

You say “Arguing over what "science" is or what counts as "scientific" is philosophy of science and there is no general agreement on criteria for this terms.”

Yes, but there is a general agreement that 2+2=5 is false. And more agreement is not needed.

The foundational MMT sectoral balances equation is algebraically false.#1 And this settles the matter already. Because the foundational economic concept of profit is false the whole theoretical superstructure is false. Because of this, MMT policy guidance has no sound scientific foundations. The only open question is whether MMTers are too stupid for science or whether they abuse the prestige of science for political agenda pushing.

This question is answered by the appearance of MMT’s Pavlina Tcherneva on Foreign Affairs. Roughly speaking, Foreign Affairs is for the Capitalist Party what Pravda has been for the Communist Party. Foreign Affairs is the mouthpiece of the CFR. And everybody knows since Carrol Quigley’s Tragedy and Hope that the CFR and its forerunners had the interests of the Oligarchy on their mind and not so much the interests of WeThePeople.

The appearance of Pavlina Tcherneva on Foreign Affairs is a message from the Central Committee of Capitalism to economists worldwide to make up their minds and to support the current policy of deficit spending/money creation which is the last instrument to mitigate the accelerated breakdown of the system.

Of course, MMTers are free to fight for the survival of Capitalism but it is utter corruption to pretend that this is science.


#1 Profit

***
REPLY to Tom Hickey on Jul 25

You say: “The foundational MMT sectoral balances equation is an accounting identity. Are you disputing that?”

Not at all. The crucial point is, that I have given the unassailable proof that MMTers have messed up the foundational macroeconomic accounting identity. See
Wikipedia, economics, scientific knowledge, or political agenda pushing?
Section ‘Exemplary proof of the inconsistency of economics’ and Sub-sections ‘Provably false Keynes/MMT’.

Everyone with basic mathematical skills can immediately check the proof.

So, MMT is disproved at the elementary level. Meaning, MMT is scientifically worthless. Meaning, MMT is brain-dead political agenda pushing to the advantage of the Oligarchy and to the disadvantage of WeThePeople.

And this is exactly why MMT is promoted by Foreign Affairs.

Pretty straightforward, indeed.

***

Twitter Jul 25

Source Twitter

***
Twitter Aug 4



Twitter Jan 18, 2021 It is called relief package but it is a free lunch for the Oligarchy.




Twitter Jan 19


Twitter Apr 12



Longtermtrends Apr 12



Twitter Apr 13


Twitter Apr 19



Twitter Apr 24


Twitter Apr 24



Bill Mitchell's Blog May 4 The macroeconomic narrative continues to evolve,  the game is not yet over.


Bill Mitchell's Blog Mai 25 MMT is the new doctrine but there are some folks who still maintain that public deficit/debt is bad for WeThePeople

"Don’t say its over until its over ― MMT is not close to dominating the narrative

 
Don’t say its over until its over. There has been progress in the macroeconomics narrative since the GFC, which accelerated during the pandemic. Governments have certainly expanded fiscal deficits and taken on more debt and the usual hysteria, which many of those same governments helped to ferment in the public debate, has fallen away. Obviously, for political reasons, a government that has previously been terrorising the population about the dangers of deficits and rising debt as a cover for ideologically-driven austerity programs, has no incentive in continuing those narratives while they have been dragged into maintaining capitalism on life support."

Note that the words profit or distribution do NOT appear once in the whole article.

For more about the Profit Law see AXECquery.
For more on Austerity see Links.


Twitter 29 May The new doctrine at work




Twitter Jun 18 Senator John Yarmuth declares the policy switch from austerity to deficit overdrive





E-PAMPHLETS,  August 2021, Randall Wray What Is MMT’s State of Play in Washington?

July 19, 2020

#HallOfScientificShame

Reference Twitter Thread

See also the hashtags #Economics #DebunkingEconomics #FailedScience #FakeScience #CargoCultScience #ScientificIncompetence #Economists #StupidOrCorruptOrBoth #EconBlocker #OrthodoxEconomics #HeterodoxEconomics #Pluralism #NoFalseHeroMemorials #AgendaPusher #DrainTheScientificSwamp #DeleteEconomics #DefundEconomics #FireEconomists #ScrapTheLot #ParadigmShift #NewParadigm #Science #MacroFoundations #ProfitTheory #SovereignEconomics


Reference Profit

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***
Wikimedia AXEC109i


For details of the big picture see cross-references Profit

July 15, 2020

The counterfeit currency printers

Comment on The Baffler/Dave Denison on ‘The Money Printers’*

Blog-Reference

It is pretty obvious that Dave Denison has NO idea of how the monetary economy works. Because of this, he cannot properly assess MMT.

The underlying problem is that the monetary economy (capitalism or communism does not matter) is NOT a self-optimizing equilibrium system but eventually breaks down.#1

The 2-sector Profit Law#3 Qm≡I−Sm tells one that macroeconomic profit is positive in a growing economy as long as the business sector’s investment is greater than the household sector’s saving. If this fails, macroeconomic profit turns into loss and the economy breaks down. This must eventually happen, what is unknown is the exact date.#2

However, there is a way to postpone the breakdown. The Profit Law including the state sector reads Qm≡(I−Sm)+(G−T), that is, the second component of macroeconomic profit is the state sector’s deficit. It holds Public Deficit = Private Profit.

This means that the greater part of the profit in the United States is actually produced by the state. The US economy hangs for a long time already on the state ventilator for its survival.

The MMT policy of deficit spending/money creation is ultimately a means of postponing the breakdown of the US economy. From a political standpoint, the COVID pandemic provides a good rationale to mute the budget-balancers and to blow the deficit up to hitherto unknown proportions.

The volume of the deficit and the popularity of MMT#4 is a good metric for the acceleration of the breakdown.#5

If MMTers intend to learn economics I recommend the new textbook Sovereign Economics.#6

Egmont Kakarot-Handtke


* The Baffler
#1 Major Defects of the Market Economy
#2 Mathematical Proof of the Breakdown of Capitalism
#3 Wikimedia
#4 Keynes, Lerner, MMT, Trump, etc. and exploding profit
#5 Criminals and the monetary order
#6 Amazon or BoD

***
REPLY to Peter Pan on Jul 16

Predicting the future is not for scientists but for prophets and other sociopaths.#1 Today it is mainly used by the media for the psychological conditioning of a mass audience.


#1 Scientists do not predict

***
REPLY to Peter Pan on Jul 17

I say “Scientists do not predict the future.”

You ask “What are climate scientists doing?”

Same thing. Genuine scientists try to figure out how the climate works. Political agenda pushers like Al Gore then grab some preliminary research findings, blow the big political tuba, and buy the stocks of the companies that are the most probably climate change winners.

Future-tellers or warners are political/psychological frauds since time immemorial. Read the so-called holy books if you want to know how the prophecy business works.

***
REPLY to Tom Hickey on Jul 17

Of course, scientists who have a true theory can make a conditional prediction, i.e. if a, b, c the outcome will be y.

Economics is a failed science and economists do not have the true theory. So, all debates about what the future will bring are vacuous prophecies, i.e. attempts to brainwash the public.

Go to Zerohedge or YouTube and you can have as many economic prophesies as you like. Nothing of it is a scientifically acceptable prediction because economists have no true theory. Economics has never been anything else than political agenda pushing, MMT included.

***
REPLY to Tom Hickey on Jul 18

You say “There is not even a framework in terms of which scientific theories could be generated and evaluated in social science, including economics, that provide a general explanation of data in the field in any way comparable to natural science. This owing to the subject matter not being ergodic and also being historically relative and complex, for example.”

Yes, one still hears these silly excuses. I have collected them all.#1 And obviously, you have not realized to this day that they are thoroughly refuted.

You say “A lot of very smart people have been working on formalizating a general explanation in social science for a long time — economists, mathematicians, biologists and physicists included.” How do you know that these people were very smart? Because you have been told. And you are a herd creature. Being a dumb person yourself you cannot possibly identify a very smart person. So you have to rely on hearsay and end up believing that Stephanie Kelton is the “Smartest Economist In America”#2 while she is plain political fraud.

The provable fact is that the representative economist is a methodological swampie#3, #4 and too stupid for the elementary algebra of macroeconomics.#5, #6 And that settles the matter for good. Because the axiomatic foundations of economics are false to this day the whole analytical superstructure is false. Because of this, economic policy has no sound scientific foundations. Because of this, economics is iatrogenic.#7 Meaning, that scientifically incompetent economists are the root cause of economic crises and the social devastation they bring with them.

Your methodological argumentation is the usual post-modern blather which amounts to anything-goes and ensures that all remains in the swamp of inconclusiveness where “nothing is clear and everything is possible”. (Keynes)#8 The swamp is the preferred habitat of fake scientists, i.e. political agenda pushers.

Economists are stupid/corrupt and a scientific disgrace. This is a proven fact.#9 They even admit that the so-called social sciences are not quite up to scientific standards but then award themselves the “Bank of Sweden Prize in Economic Sciences …” The insane plural gives the fraud away.

At the Flat-Earth-Cemetery they have already dug the graves for orthodox economists, heterodox economists, MMTers, and you and your troll buddies.#10 Times to shut up and go.


#1 Failed economics: The losers’ long list of lame excuses
#2 Down with idiocy!
#3 Economics, methodology, morals ― a creepy freak-show
#4 How incompetent are economic methodologists? Very!
#5 Wikipedia, economics, scientific knowledge, or political agenda pushing?
#6 Economists: at the end of the wrong track
#7 Iatrogenic economics
#8 Economic recommendations out of the swamp between true and false
#9 Ch. 13, The indelible scientific disgrace of economics, in Sovereign Economics
#10 They can be found easily by searching for #EconBlocker

***
#PointOfProof
Jul 18

July 12, 2020

MMT ― a Wall Street myth

Comment on Chris Dillow on ‘The Deficit Myth: A Review’

Blog-Review and Blog-Reference and Blog-Reference

Chris Dillow’s main point of critique is “For me, Kelton is ― albeit very lucidly ― reinventing the wheel.”

This is, in fact, a spurious compliment because MMT is proto-scientific garbage and Stephanie Kelton is academic fraud.#1

MMT’s macroeconomics is provably false since Keynes, Kalecki, Lerner, etc. So, MMT policy guidance has no sound scientific foundations.

The macroeconomic Profit Law implies Public Deficit = Private Profit. This means that the greater part of the profit in the United States is actually produced by the state. The US economy hangs for a long time already on the state ventilator for its survival.

Among all that academic garbage, MMT has the right message for Wall Street. Who is MMT’s first apostle? Right, Warren Mossler, ex-Wall Street. But Stephanie Kelton is, without doubt, the more attractive sales-person. Economics has become part of the entertainment industry long ago and the casting is done in Hollywood where they know best what sells.

The rest is marketing/PR routine. Interviews, book, media hype, No 1 on the best-seller list, and then, of course, trolling in the social media. This is where Chris Dillow comes in “Dr Kelton explain these ideas wonderfully clearly, so I recommend this book to all non-economists interested in government finances.”

MMT is itself a myth. MMT policy is NOT for the benefit of WeThePeople. MMT is the issuance of counterfeit currency in the form of deficit spending/money creation for the benefit of the one-percenters. Because PublicDeficit = PrivateProfit, MMT is the biggest redistribution program ever. MMT is a political fraud.

“Chris Dillow is a Marxian economist,” says Tom Hickey at Mike Norman Economics. There are historians who claim that already Marx was on the payroll of the financial Oligarchy.

Egmont Kakarot-Handtke


#1 More details

Related 'Wikipedia, economics, scientific knowledge, or political agenda pushing?' and 'Your economics is refuted on all counts: here is the real thing' and 'Dear idiots, MMTers are Wall Street’s agenda pushers' and 'How MMT enlightens Washington' and 'Very busy these days: Wall Street’s agents' and 'Hype does not help: MMT is toast' and 'Mr. Wray goes to Washington' and '#PublicDeficitIsPrivateProfit #MMT #JustAnotherFraud' and 'Links on Liza N. Burby‘s ‘Cutting-Edge Economist Stephanie Kelton Delivers Presidential Lecture’' and 'MMT, Warren Mosler, and the little helpers from Wall Street and Academia' and 'Stephanie Kelton: MMT’s public farce' and 'Occasional Tweets No 201215: The mental breakdown of MMT'.

***
COMMENT on aragon on Jul 14

You say “Every unit of currency gets a vote in economics, resulting in efficiency of the transfer of wealth to the top 0.01%.”

And how does this happen practically? This is due to the macroeconomic Profit Law which implies Public Deficit = Private Profit.#1 As a logical consequence, the public debt of WeThePeople is roughly equal to the financial assets of the one-percenters.

You are an economist, and this happens right before your eyes! And you don't see that the MMT policy of deficit spending/money creation is the biggest financial hoax of all times ($3.7 trillion)? And you do not wonder that the “Marxian economist” Chris Dillow applauds the Wall Street agenda pusher Stephanie Kelton? And all you can think of is this Anatole France kitsch?


#1 Profit

***
REPLY to aragon on Jul 15

You quote approvingly “It will be a very long time before the process of creative destruction unleashes fresh growth.”

It is pretty obvious that you have NO idea of how the monetary economy works.

The underlying problem is that the monetary economy (capitalism or communism does not matter) is NOT a self-optimizing equilibrium system but will eventually break down.#1

The Profit Law#3 Qm≡I−Sm tells one that macroeconomic profit is positive in a growing economy as long as the business sector’s investment is greater than the household sector’s saving. If this fails, macroeconomic profit turns into loss and the economy breaks down. This must eventually happen, what is unknown is the exact date.#2

However, there is a way to postpone the breakdown. The Profit Law including the state sector reads Qm≡(I−Sm)+(G−T), that is, the second component of macroeconomic profit is the state sector’s deficit. It holds Public Deficit = Private Profit.

This tells one that the greater part of profit in the United States is actually produced by the state. The US economy hangs for a long time already on the state ventilator for its survival.

The MMT policy of deficit spending/money creation is ultimately a means of postponing the breakdown of the US economy. From a political standpoint, the COVID pandemic provides a good rationale to mute the budget-balancers (Kelton ukase on Twitter: Learn MMT ― shout down the critics) and to blow the deficit up to hitherto unknown proportions.

The volume of the deficit and the popularity of MMT#4 is a good metric for the acceleration of the breakdown.#5 This breakdown has nothing at all to do with creative destruction, it is destructive destruction. And it is very improbable that it “unleashes fresh growth” somewhere in the future.

If you intend to learn economics I recommend the new textbook Sovereign Economics.#6


#1 Major Defects of the Market Economy
#2 Mathematical Proof of the Breakdown of Capitalism
#3 Wikimedia
#4 Keynes, Lerner, MMT, Trump, etc. and exploding profit
#5 Criminals and the monetary order
#6 Amazon.de or BoD

July 10, 2020

What Is MMT? (Short Version)

Comment on Brian Romanchuk on ‘What Is MMT? (Short Version)’

Blog-Reference and Blog-Reference and Blog-Reference on Sep 23 and Blog-Reference Sep 24

  • MMT is the issuance of counterfeit currency in the form of deficit spending/ money creation for the benefit of the one-percenters.
  • Genuine currency and counterfeit currency are indistinguishable because they originate from the same source: the Fed. It all depends on whether additional fiat money is injected on the supply or the demand side.
  • MMTers are not scientists but political agenda pushers. MMT policy is to the disadvantage of the ninety-nine-percenters. The counterfeiter steals from the rest of society via the anonymous price mechanism.
  • It is the ninety-nine-percenters who owes the public debt. And it is the one-percenters who owns the corresponding financial assets. Interest on public debt works like a regressive tax as long as the debt is rolled over.
  • Because #PublicDeficitIsPrivateProfit, MMT is the biggest redistribution program ever.
  • MMT is a political fraud.#1

Egmont Kakarot-Handtke


#1 More details

Related 'What is MMT?' and 'Keynes, Lerner, MMT, Trump, etc. and exploding profit' and 'MMT Basics' and 'Wikipedia, economics, scientific knowledge, or political agenda pushing?'. For the full-spectrum refutation see cross-references MMT.

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Wikimedia AXEC165


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REPLY to Asad Zaman

You say: “One of the key insights of MMT is that NOBODY ‘owes’ the public debt.”

This is not a key insight but a key deception of MMTers in order to sell the deficit-spending/money-creation program to a naive public.

Note that

• The macroeconomic Profit Law implies Public Deficit = Private Profit.#1 MMT policy is a free lunch for the Oligarchy.

• Public debt grows in lockstep with deficit-spending/money-creation. It holds WeThePeople owe the debt and the Oligarchy owns the corresponding financial assets. The state manages the public debt on behalf of WeThePeople.

• The Oligarchy appreciates this very much because the taxman collects interest from WeThePeople in the form of taxes and hands the full amount in time over to the Oligarchy. The state is considered as the best debtor because of its unlimited taxing power.

• Taxing power replaces the bone-breaking of private debt collection which the Oligarchy considers as inefficient/expensive.

• Thus, the debt-slavery of WeThePeople is established by pretending that nobody owes the debt and nobody pays interest. As Lerner's Lie goes: We owe the debt to ourselves and pay interest to ourselves. The lie is the fake collective We.

MMTers are the academic agenda-pushers of Wall Street. They deceive WeThePeople. Asad Zaman and the rest of self-styled Progressives are complicit in the greatest financial fraud in history.#3



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REPLY to Yoshinori Shiozawa on Sep 28

The lethal defect of the MMT policy of deficit-spending/money-creation is on distribution, not on inflation. The observable distribution of income and financial wealth between the 1% and the 99% is the outcome of MMT policy.#1

The inflation discussion is a smokescreen.#2

The macroeconomic price formula states for the elementary case P=ρW/R. ρ>1 represents private/public deficit-spending/money-creation and this implies that a period deficit produces a one-off price hike and NOT inflation.#3


#2 Gosh! the One Percent have gotten $21 trillion richer: Links on Distribution

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REPLY to Asad Zaman on Sep 29

The MMT textbook gets the foundational macroeconomics sectoral balances equation wrong. For details see Refuting MMT’s Macroeconomics Textbook.

Because of this, the analytical superstructure (inflation, employment, etc.) is provably false.

July 7, 2020

MMT Basics

Comment on Lars Syll on ‘MMT basics’

Blog-Reference and Blog-Reference on Jul 8

  • The counterfeiter never runs out of money.
  • The counterfeiter never stops stealing stuff from the rest of society.
  • The counterfeiter increases the profit of the business sector with his additional demand.
  • The counterfeiter says that he is good for the economy and employment.
  • When the economy breaks down the counterfeiter increases deficit spending/ money creation.
  • The counterfeiter 'solves' any problem from unemployment to pandemics to global warming with deficit spending/money creation.
  • The counterfeiter continuously increases the public debt but says that it does not matter.
  • The counterfeiter is a criminal but never gets caught because he games the fiat money system from within.#1, #2, #3
  • The counterfeiter gets valuable PR support from academia, in particular from the MMT fake science trolls.#4

Egmont Kakarot-Handtke


#1 Criminals and the monetary order
#2 MMT sucks
#3 Cross-references MMT
#4 The sectoral balances obfuscation: stupidity or corruption?

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Wikimedia AXEC152

July 4, 2020

Economists: at the end of the wrong track

Comment on Barkley Rosser on ‘July 24 Society For Chaos Theory In Psychology And Life Sciences Conference’

Blog-Reference

As usual, Barkley Rosser promotes cargo cult stuff. Cargo cult was the name that Feynman gave the ‘social sciences’, in order to clearly distinguish them from genuine science. Here are some programmatic highlights from the ongoing aberration:

• "Applications of prisoner's dilemma modeling in search of a more socially just dominant strategy: Overcoming anxiety associated with group oppression: Lessons from a single case study"
• "Stability swtiching in Cournot duopoly games with three delays"
• "Covid-19 and the nonlinear dynamics of everyday life"

All this fits perfectly Feynman's definition: “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.”

The essential insight that economists are missing is that they are for 200+ years now on the wrong track, i.e. in the wrong Paradigm. Economics is not a 'social science' but a systems science.#1, #2

For Barkley Rosser, it is too late but for those who are fed up with 200+ years of proto-scientific garbage and want to know what the Paradigm Shift looks like there is now the first scientifically valid economics textbook available.#3

Egmont Kakarot-Handtke


#1 Wikipedia, economics, scientific knowledge, or political agenda pushing?
#2 Your economics is refuted on all counts: here is the real thing
#3 Sovereign Economics

Related 'Dilettantes at the end of the coal-pit' and 'Modern macro moronism' and 'Economics: 200+ years of scientific incompetence and fraud'.

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REPLY to Fred C. Dobbs on Jul 5

You say “Kanye West tweets he’s running for president this year.”

That’s a nice try to distract from the fact that Barkley Rosser is promoting the agenda of the Society for Chaos Theory in Psychology And Life Sciences. The title reminds one immediately of a $30 bill.

Note that economists do not know to this very day what profit is. They are simply too stupid for the elementary algebra that underlies macroeconomics. Just check the proof.#1 What do you think one can learn from failed economists about psychology or any other topic?

Nothing. Right.

By the way, if Caligula made his horse a Roman consul, Kanye West can be made president. What goes in contemporary politics is an old hat in academia. After all, Barkley Rosser has been made an economics professor. And he is not as smart as a horse.

#1 Wikipedia, economics, scientific knowledge, or political agenda pushing?
Section Provably false

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REPLY to Barkley Rosser on Jul 6

Name-dropping again ... the world's leading blablahblah ... cited many tens of thousands of times ... Princeton ... RAND ... John von Neumann ... And almost all are best buddies of the academic busybody Barkley Rosser.

Yes, Barkley Rosser, you know a lot of people from the academic entertainment industry, too bad that you have no idea how the economy works.

You say “It is true that economists have used game theory a lot, but they did not invent it, and people from many other disciplines have used it.” Did it ever occur to you that game theory is zero-sum and that the market economy is not zero-sum. For 200+ years now macroeconomic profit is obviously greater than zero. So, to begin with, game theory is NOT applicable to economics. Von Neumann’s Theory of Games and Economic Behavior is plain methodological BS because it gets the pivotal economic concept of profit wrong.

And you hang around in academia and all these pointless conferences and have not realized that something is deeply wrong with economics. Guess what, it has nothing to do with animal behavior or the nonlinear dynamics of armed groups in Yemen and Pakistan.

Learn economics, Barkley Rosser. The canonical textbook Sovereign Economics#1 is your last chance.


#1 Amazon or BoD

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REPLY to Barkley Rosser on Jul 7

You say “Wow, I have not seen you fall so spectacularly on your face practically ever. I do not know where you went to econ grad school, but apparently they did not teach you even the most elementary game theory.” and “Sorry, Egmont, but no, it is not in general zero sum. Indeed, the classic example of it not being zero sum is that most famous of cases you poked at: the prisoner's dilemma.”

Take notice first, Barkley Rosser, that the term game theory covers TWO different approaches, that of von Neumann and that of Nash. The prisoner's dilemma belongs to Nash. Von Neumann had only utter contempt for the Nash approach (see Mirowski who has extensively dealt with the issue).

Here is the summary “Finally, algorithmic rationality infected game theory itself, changing von Neumann’s original project considerably. The Nash Equilibrium, for Mirowski the paradigm case of the ‘rationality of the paranoid’ (p. 343), stands for him in marked contrast to von Neumann and Morgenstern’s earlier work. Mirowski points to various sources that report von Neumann’s rejection of the equilibrium concept; further, he finds in Nash’s work all of the ingredients that had beset the Cowles Commission: ‘hyper-individualism, non-accessible utility functions, constrained maximization, and cognition as a species of statistical inference’ (p. 348). The Nash equilibrium, Mirowski concludes, is to be seen as a ‘logical extension of the Walrasian general equilibrium tradition into the Cold War context’ (p. 339), but not as a continuation of von Neumann’s project.”#1

Obviously, it is you who is not familiar with the most elementary facts about game theory. No surprises here.

The term zero-sum game relates to the von Neumann approach and has nothing to do with the prisoner's dilemma.

Von Neumann was well aware that there are non-zero-sum n-person games but he transformed them into zero-sum games with the introduction of the n+1 th player.

Take notice, second, that von Neumann had no idea of what macroeconomic profit is. There are three references to profit in the index and they tell you that von Neumann did not understand the essence of economics. He simply redefined utility as profit for the entrepreneur, see footnote 2 on p. 33 ToG.

No way leads from game theory in any version to macroeconomic profit.#2 Game theory is essentially a new version of the old angels-on-a-pinpoint blather that is so beloved in scientifically incompetent academic circles of which you are a card-carrying member.

Economics is fake science and you are the living proof.


#1 Economica Till Gruene
#2 Wikipedia, economics, scientific knowledge, or political agenda pushing?

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REPLY to Barkley Rosser on Jul 8

The lethal defect of game theory is that neither von Neumann nor Nash got the foundational economic concept of profit right. This defect they share with the representative economist to this very day.

So, this whole set-theoretical fireworks with Brower's and Kakutani's fixpoint theorems is scientifically beside the point and serves only to train mentally retarded economists to dance around false-hero-memorials.

Von Neumann got his math from Hilbert in Göttingen. There, he was one of many talented mathematicians. He learned soon that he could sell his talent at a premium in the United States. In an environment that runs on the principles of show business, he hyped himself or was hyped to the status of mathematical demi-good (Mirowski, Machine Dreams).

Von Neumann was on the payroll of the military and he died as an alcoholic in the Institute for Advanced Salaries as he himself called it. In sum, von Neumann was instrumental in weaponizing mathematics and swapping the principles of science for the dictates of show business. In the history of science, von Neumann will feature as one of the corruptors of mathematics.

The sickest joke in the sick story of game theory is that the foundational blunder of economics lies on the level of elementary algebra.#1 So much for the achievements of mathematical economics. It is proto-scientific garbage, just like the rest of economics.

Here is the three-step program for the New Paradigm
1. Defund economics.
2. Fire economists.
3. Scrap the lot and start again. (J. Robinson)


#1 Your economics is refuted on all counts: here is the real thing

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REPLY to Barkley Rosser on Jul 8

You say: “What? Joan Robinson accepted your wacko profit theory, Egmont? I never knew.”

Of course, you know nothing because you are not only stupid but also lazy. Go to the library and get Robinson, J. (1956). The Accumulation of Capital. London: Macmillan. See pp. 400-402.

“… an excess of investment over saving is an undistributed profit to the firm, …” (p. 402) and this corresponds formally to equation (32) in my 2011 working paper Keynes’s Missing Axioms.

Do you need more proof of your utter scientific incompetence, wacko Barkley?

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REPLY to Barkley Rosser on Jul 9

You say “I have never said that your theory is wrong, but rather that it is a vcuous tautology. Everybody knows about retained earnings, and it is a matter of no importance except slightly in determining investment.”

No, you did not say that my profit theory is wrong, you said that it is wacko.

You try to suggest that for me “… thinking about retained earnings is the most important thing in economics, …”.

No, the most important thing in economics is to get the foundational concept of profit right. And the fact of the matter is that economics is provably false on this all-decisive score for 200+ years.#1

Economics is NOT a science, economists are NOT scientists but clowns and useful idiots in the political Circus Maximus. The representative economist is stupid or corrupt or both. The economics Nobel is a fraud.


#1 Your economics is refuted on all counts: here is the real thing

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REPLY to Barkley Rosser on Jul 10

You say “The wacko part is that you think it is important. It is utterly trivial. It is rather like somebody deciding that the fundamental key to understanding all of mathematics is to realize that 7 + 2 = 9. This is certainly true, and it is also something that anybody who knows even basic arithmetic knows.”

By trying to trivialize the absolutely devastating proof that economists got profit wrong for 200+ years you shoot yourself in the head.

Ultimately, the Profit Law for the investment economy, i.e. Qm≡I−Sm, is indeed trivial. It is elementary algebra. The point is that economists are too stupid for elementary algebra.#1 And because of this, they get profit for the elementary production-consumption economy, i.e. Qm≡−Sm, wrong, and then the more complex investment economy with profit distribution, i.e. Qm≡Yd+I−Sm, and so on. By consequence: because economists are too stupid for the elementary algebra of macroeconomic profit determination, the whole analytical superstructure of economics is provably false. By consequence, economic policy guidance NEVER had sound scientific foundations.

This proven scientific incompetence does not only apply to Barkley Rosser, it applies also to his faculty. More, it applies to ALL economics faculties in the United States, and it applies to the American Economic Association and the peer-reviewers of its journals. ALL these folks get the trivial algebra of profit wrong.


#1 See section ‘Provably false’ in Wikipedia, economics, scientific knowledge, or political agenda pushing?

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REPLY to Barkley Rosser on Jul 11

You say “Weil, Egmont, my evolutionary game theorist friend, Bill Sandhlm may have just blown his brains out, at least he did himself in somehow or other. Perhaps he read your recent writings and took them too cloaely to heart. Heck, he might even have come to believe that 2=7=10. ”

The University of Wisconsin–Madison says “Colleagues knew Bill as “a genuine scientist; detail-oriented, open-minded, and uncompromising in the pursuit of truth,” “a humble scholar with an enormous love for research,” “an exceptional human being, generous with his time,” “kind and supportive to all, and a cherished mentor.” and “After years of struggling with depression, Bill ended his life earlier this week.”