Profit-worship, race to the bottom, short-term fixation, financialization and commodification set profit above all long-term necessities, socially necessary work and environmental caring. When economics becomes brainwashing in market radicalism (cf. Ulrich Thielemann), problems are called motivational and psychological, not structural and exogenous, not endogenous. Mainstream economics refuses to discuss the financial crisis and repeats the neoclassical mantra of self-correcting markets returning to equilibrium. State indebtedness in bailing out speculative banks with hundreds of billions is swept under the carpet. Private losses mutate into public taxpayer losses. The MIT economist Simon Johnson explains this in his article in The Atlantic “The Quiet Coup.”
Unregulated finance capitalism is like a tiger breaking from his cage, puts the cart before the horse, bridles the horse by the tail and confuses the goat and the gardener. Valuing the worker and dismissing the worker as a cost factor is a contradiction of capitalism.
Expansion of the public sector, closing tax havens ($1 trillion), restoring taxes on the super-rich and corporations, encouraging investments in the real economy, qualitative growth, environmental caring and community centers are signs of the social contract. Generalized security means abandonment of neoliberal myths of self-healing markets, corporate beneficence, nature as free good, external or sink, selective history, exploding inequality and the Orwellian language of CEOs as job-creators and workers as cost-factors.
Economics is pluralist and not brainwashing in market radicalism. The myths of the self-healing/self-correcting market, corporate beneficence and nature as a free good, external and sink must be overcome like the myths of efficient markets, perfect information and speculation as investment. Swiss, Austrian and German economists (e.g. Stephen Schulmeister, Ulrich Thielemann, Peter Ulrich and Elmar Altvater) could help us correct the inflation of the financial sector and the myths of trickle-down economics.and financial products. Albert Einstein said the bomb changed everything except the way we think and the one thing we learn from history is that we don’t learn from history. As war is too important to be left to the generals, development is too important to be left to Goldman Sachs and the extractors. Businessmen are not the only ones who know about growth and development. – See more at: http://www.thomhartmann.com/forum/2014/01/tiger-and-his-trainers#sthash.4RtMjRV7.dpuf
Restoring Shared Prosperity: A Policy Agenda from Leading Keynesian Economists.Editors: Thomas I. Palley and Gustav A. Horn.
The economic recovery in the US since the Great Recession has remained sub-par and beset by persistent fear it might weaken again. Even if that is avoided, the most likely outcome is continued weak growth, accompanied by high unemployment and historically high levels of income inequality. In Europe, the recovery from the Great Recession has been even worse, with the euro zone beset by an unresolved euro crisis that has already contributed to a double-dip recession in the region.
This book offers an alternative agenda for shared prosperity to that on offer from mainstream economists. The thinking is rooted in the Keynesian analytic tradition, which has been substantially vindicated by events. However, pure Keynesian macroeconomic analysis is supplemented by a focus on the institutions and policy interventions needed for an economy to generate productive full employment with contained income inequality. Such a perspective can be termed “structural Keynesianism”. These are critical times and the public deserves an open debate that does not arbitrarily or ideologically lock out alternative perspectives and policy ideas. The book contains a collection of essays that offer a credible policy program for shared prosperity, rooted in a clear narrative that cuts through the economic confusions that currently bedevil debate.
Contributions by Richard L Trumka, Thomas I Palley, Gustav A Horn, Andreas Botsch, Josh Bivens, Achim Truger, Jared Bernstein, Robert Pollin, Dean Baker, Gerald Epstein, Damon Silvers, Jennifer Taub, Silke Tober, Jan Priewe, John Schmidt, Heidi Shierholz, William E Spriggs, Eckhard Hein, Heiner Flassbeck, Gerhard Bosch, Michael DauderstädtThe book is available for $7.52 at AMAZON.COMA free PDF is available HERE.
Financialization: The Economics of Finance Capital Domination
by Thomas Palley, Palgrave Macmillan, May 2013
This book explores the process of financialization whereby economies are increasingly dominated by finance capital. This process is characterized by rising income inequality, wage stagnation, increased indebtedness, a rising financial sector share of profits, and tendencies to generate asset price bubbles. The financial crisis of 2008 and the subsequent recession and stagnation represent the latest phase.
The book provides a comprehensive treatment of these developments, beginning with a presentation of the empirical evidence. That is followed by economic theory chapters dealing with the macroeconomics of financialization; business cycle effects; microeconomic developments; tendencies toward Minsky-style economic instability; and economic growth effects. The final section of the book focuses on the political economy of financialization and policies to stabilize financial markets.