Naked Keynesianism

So Ann Petiffor twitted a link to a post on why economists do not read Polanyi's The Great Transformation (or the other GT; yes the one is Keynes' General Theory) The author, Marko Grdesic, basically suggests that economists do not read books, period.* I would add, let alone Polanyi that was always at the fringes of mainstream economics. He estimates that about 3 percent of economists have read Polanyi. That reminded me of a story that Eichengreen had told me about a course he taught...

By Thomas Palley (Guest blogger)2016 was supposed to have been the year of Jeb Bush versus Hillary Clinton: the year when the established Bush dynasty confronted the upstart rival Clinton Dynasty. But the year of the insider has turned into the year of the outsider. On both sides, voters have unexpectedly given vent to thirty years of accumulated anger with neoliberalism which has downsized their incomes and hopes.Though the Republican rebellion has been more clear-cut in its dismissal of...

Jack Goody was one of those rare thinkers that tried to think big. Not common in economics anymore, and less clear in other social sciences, as somewhat narrowly defined techniques take over the breadth of historical understanding. I've only read before his The Theft of History, somewhat iconoclastic book in which he debunks the idea that individualism, democracy and freedom were somehow invented by modern Western society.I started reading now his Metals, Culture and Capitalism. There are...

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That's more or less the same pace of growth as before, and suggests that the slow recovery continues. The unemployment rate ticked up to 5%, since the labor force participation rate increased from previous month. (but still below the pre-recession level, as shown below). So in this case, a slightly higher rate of unemployment is not a bad thing. It means more people are confident they can find jobs. Notice that manufacturing employment has declined for the third month in row.  This also...

According to Shue and Townsend most of the growth in CEO compensation has been based on options. Looking at the figure below I would say stocks have also played a role. This is all in a period in which the CEO to worker compensation ratio was already at very high levels by historical standards. And by the way, it is also very high by international standards. And you think a $15/hour wage is too high!

The last estimate of real GDP growth in the fourth quarter of 2015 indicates that the economy expanded at 1.4%. Not very fast. Also, this week the Bureau of Economic Analysis (BEA) announced that personal consumption expenditures (PCE) increased 0.1%, and revised down the January number to 0.1%. In other words, consumption is slowing down, or so it seems. More importantly, the report says: "The February PCE price index increased 1.0 percent from February a year ago. The February PCE price...

If Argentina finalizes an agreement with the holdouts, the so-called Vultures, it will close a long process that started with default in 2002, and was followed by renegotiations with about 93% of bondholders in 2005 and 2010. How fast has this process been when compared to other debt rescheduling processes? Figure below by Christian Suter (subscription required) looks at the average duration of defaults on foreign bonds in three different periods. Even though it misses the debt crisis of the...

The volume of financial transactions has stabilized since the Global Financial Crisis of 2008, but remans at very high levels, as shown in the figure below. With GDP at about 18 trillions the volume of financial transactions is about 25 times the size of GDP. The potential problems associated to a hypertrophied financial sector. Yuge! The source is this paper that discusses the possibilities of a financial transactions tax (FTT), something that has been proposed by Bernie Sanders. And as...

In 2009 I wrote that: "a progressive U.S. policy agenda toward Latin America should express support of and solidarity with the region’s left-of-center governments themselves." And central to that agenda was the need for: "would be reversing the corporate bias of the free trade agreements (FTAs) that have been signed over the past decade and a half." How well has Obama done in his almost 8 years by that yardstick, you ask. Not very well.Obama never cozied up to the left of center governments...