Posted with Michael Hudson’s permission
Grambine, Macro and Cheese, July 9 2022. https://realprogressives.org/podcast_episode/episode-180-the-end-of-dollar-diplomacy-with-steve-keen-and-michael-hudson/.
For those who would like to hear the recorded conversation
Michael Hudson [intro/music]
A central tenet of the World Bank from the beginning is to convince countries not to grow their own food, but to create plantation agriculture to prevent family-owned farming of food, to grow plantation export crops and they become dependent on the United States for their grain.
[00:00:22.610] – Steve Keen [intro/music]
If you look at just the shipping involved in international trade, it’s something of the order of 20%, I think, of our carbon production comes out of the entire mechanics of shipping goods around the planet. And we realize we’ve massively overshot the capacity of the biosphere to support our industrial sedentary civilization. So, one way to reduce that is by reducing international trade.
[00:01:35.130] – Geoff Ginter [intro/music]
Now, let’s see if we can avoid the apocalypse altogether. Here’s another episode of Macro N Cheese with your host, Steve Grumbine.
[00:01:43.110] – Steve Grumbine
All right. And this is Steve with Macro N Cheese. Another great episode for everyone today. I have two guests, two very good friends, and very happy to have them join me today. Professor Steve Keen and Michael Hudson. You can’t get two better guys than this. And we’re going to have a very action packed conversation.
We’re going to be talking about central banking, the IMF, World Trade Organization, World Bank. And we’re going to be looking at how the US uses the monetary system to bring about its imperial powers that it exerts on the world. And we’re going to look at some of the things that are happening with Russia and Ukraine right now that ship the US control over the global commerce and the behaviors of non US countries.
They’re starting to think for themselves and make some decisions, and we’re watching the facade crack a little bit. Steve Keen, who is the author of the book Debunking Economics and more recently The New Economics: A Manifesto, is joining me, as well as Michael Hudson, who has just recently written the book The Destiny of Civilization: Finance Capitalism, Industrial Capitalism or Socialism. So, without further ado, Michael and Steven, welcome to the show, sirs.
[00:03:04.530] – Michael Hudson
Good to be here.
[00:03:05.800] – Steve Keen
Thank you indeed.
[00:03:06.960] – Grumbine
So the reason why I brought us together, you guys are both phenomenal on your own, but together, I think that we can maybe tackle this. As an MMT advocate, I find myself friends with an awful lot of people, and you gentlemen have been doing this for a long time, and I know that you have some pushback within the MMT community.
In particular, this concept of “imports are a benefit and exports are a cost.” This is a core MMT staple. And some of the concerns that came out as a result of the Covid crisis showed us the resource based failures of a global supply chain and how some of the aspects of our financial system and the shipping of real resources from areas that had high Covid, how it impacted our abilities to take care of life on life’s terms.
It also became quite clear that the US hegemony over the world using dollar diplomacy is starting to show cracks in the foundation as well, as we watch Russia thumb its nose at US sanctions. So, getting into this, Steve Keen, I know that you have taken some issue with Warren Mosler’s prescription that imports are a benefit and exports are a cost.
Taking Warren’s position on this, I believe Warren is saying exports are real goods and services we’re sending out, whereas imports we’re handing pieces of paper to people. And this is a win for the importing nation. And we’ve seen the power of the US dollar and the ability to basically create colonial outposts, colonized communities living and dying off of US dollars. So there’s a power dynamic as well. What is your pushback with Warren’s import/export model?
[00:05:03.270] – Keen
There are quite a few elements to it. First of all, the idea that exports are a cost and imports are a benefit. One term that I’ve seen one Modern Monetary Theory advocate used to explain is to say, the opportunity cost is all theirs. In other words, they have therefore gone by sending a good to us like an automobile to the buyer in return for currency.
They’re doing without the opportunity of the vehicle. And when you take a good look at the manufacturing side of things, the reality for most firms is they have diminishing marginal cost and excess capacity. So the standard thing when you’re competing in a domestic market is you have spare capacity you’re not using, but you can’t get enough demand domestically.
Now, I know MMT can say that should be handled by the government using additional spending power and creating the spending power to absorb the excess capacity. But they don’t at the moment. So what tends to happen instead is that countries will use export-oriented industrialization to use their additional capacity more effectively, which is what’s led to the industrialization of China and in many ways the de-industrialization of America.
Personally, I don’t think the opportunity cost is the right way to think about international trade at all. It’s a neoclassical way of thinking. It assumes neoclassical conditions about production which are empirically false. I don’t think anything in MMT should be based on bad foundations and I think that is a bad foundation.
Then when you see the discussions about monetary sovereignty and saying that countries who don’t have to issue debt in the currency which is not their own currency, they have monetary sovereignty, those who have to issue debt in a currency which is not their own don’t have monetary sovereignty. One way you end up in not having monetary sovereignty is running large balance of trade deficits and not being the reserve currency of the planet.
So I think the advice that exports are a cost and imports are a benefit doesn’t make sense for countries which have been running a trade deficit, are importing more than they’re exporting, so they’re using their own pieces of paper fundamentally, initially, but if they keep on doing it, they’ve got to start using American pieces of paper, and then they’re in deep trouble. So I just think it’s a nice slogan, but I think it’s a bad idea.
[00:07:20.250] – Grumbine
So it makes sense to me given the nature of the pandemic. You and I spoke, I guess it was almost two years ago, about supply chains and pandemics, and we talked at length about how the iPhone is made in some 37 different countries – and countries that were isolated due to the pandemic. It also impacted production in general. Right now I’m in Information Technology, and I work with Cisco, and Cisco being the backbone of the entire Internet globally.
They have lead times even today of up to a year for some of the equipment, partially because of semiconductor shortages. But this is a piggyback to that in that there is the accounting identities of trading paper for goods and services, but then there is the actual functional output of that. And for countries like the United States, we do have Most Favored Nation status in the sense that we are the primary world reserve currency.
And I think part of that has to do with the fact that the price gas and gas purchases are done through US dollars as well. But overall, I think that we have to be aware that we’re not being a very good partner on the planet in general. A lot of the power plays the United States uses to be able to get those goods and services into the US Is done through warfare and sanctions, as we’ve seen all around the world. We use them to great harm in the global South.
However, we saw Russia here recently thumb their nose at us and say, the only thing we’re really lacking is high tech products, and we got China that can hook us up with that. All you’ve done is accelerated our departure from a dollar denominated world, which I guess brings us to you, Michael. Your book talks extensively about this. Can you help piggyback off of what Steve said regarding the supply chains and the impact of that import/export dynamic with what’s going on right now with Russia, China and Ukraine?
[00:09:34.590] – Hudson
Well, MMT has not spent much time talking about the balance of payments. It’s basically a theory of the domestic economy. The problem of the whole discussion that just took place is that trade is not the most important element of the balance of payments. For the United States, the trade balance has been just about in balance for almost 50 years, 70 years, actually.
What’s in balance is America’s military spending abroad. That’s the deficit that is pumping dollars into the world economy. But now to get back to Steve’s point, realizing that we’re dealing with trade, only a small portion of the balance of payments, Steve’s point is, let’s ignore all the other elements of the balance of payments – the debt service and the capital accounts and others.
If you import more than you export, and you have to actually pay cash for the imports and get cash for the export, then you have to borrow money. And once you borrow money, because most trade is denominated in dollars, this means you have to borrow US dollars. You don’t buy imports with your own currency. Now, MMT is all about how sovereign governments can create their own money and create their own currency, but they can’t print their foreign currency.
That’s the problem with having more imports than exports. And once you begin to borrow dollars, you have to pay interest on it. And all of a sudden, they’re running a deficit, it’s going to reduce your foreign exchange rates. Well, let’s look at what’s going to happen this summer as an example. We know that energy prices, oil prices are going way up.
And President Biden just says they’re going to be with us for a very long time because his major contributors are the oil companies, and he’s promised them that he’s going to enable them to make super profits to help raise the Dow Jones average. And the other element is food. Well, America is going to make a killing on oil exports because the United States controls the world oil trade.
The United States is also a major agricultural exporter, and it’ll make a killing because NATO has imposed sanctions on Russia, preventing Russia from exporting oil and food – it’s the largest grain exporter – into the economy. So you’re going to have South America, Africa, and the global South countries all of a sudden running big deficits.
Well, at the same time, there’s an enormous deficit of debt service that they owe to finance all of the trade deficits that they’ve been running ever since they followed neoliberal ideals to open their markets to depend on foreign food and basically US manufacturers. The Federal Reserve has just begun to raise interest rates. And the result of raising interest rates has been the dollar is going way up against the Latin American currencies, the African currencies, the South African rand, the Brazilian currency.
So you’re going to have the global South being in an absolute currency squeeze this summer. What are they going to do? Well, President Putin has said, well, we’re going to offer an alternative in the form of the BRICS bank. Well, it’s true that a bank can’t create foreign currency. The BRICS bank can enable countries to run a deficit in two ways.
Number one, the bank can be fueled by each member giving, say, a trillion dollars or some kind of proportional currency to the bank. So currency swap agreements, just like the United States has been negotiating for the last 50 years. You can all have a currency swap. Also, the BRICS bank can create its version of Special Drawing Rights – IMF SDRs – or what John Maynard Keynes proposed in 1944: “bancors.”
It can create paper gold of its own and distribute to countries. Well, the problem is, Putin said, we’re willing to sell your grain and oil and to take your currency in exchange, but we don’t want to save your balance of payments simply so that now you can afford to pay the debt service that you owe to US dollar bond holders, bank holders, and the IMF and the World Bank that got you into the mess you’re in to begin with.
So the problem is the stability of insulating your trade from the foreign exchange going up and down requires a split of the world into two different economic zones: US/NATO, the white people’s economic zones, and let’s call it the nonwhite economic zones. And remember, the Ukraine say that Russians are not white and racially different. Basically, the Nazi ideology is that any country that’s not neoliberal is not white.
So you’re going to have the world splitting, and we’re really talking about how to create a monetary system for the world splitting. I want to get back to one other thing Steve said about the opportunity cost. If imports are a great advantage to the United States, is it worth having American corporations move to low wage labor abroad, shifting the production abroad so that America is deindustrialized?
Has that been an advantage? Or let’s look at it from Russia’s point of view. Until this last spring, Russia was importing food, cheese, raw materials. And because of the sanctions, Russia has had to all of a sudden develop import substitution. It’s producing its own cheese. It produced its own agriculture that’s thriving.
And President Putin has said that Russia is going to spend more and more of its oil export receipts on funding import-replacing industry. Well, that sounds like a good idea, because we’re really talking about independence. And the balance of payments ultimately determines a constraint on domestic policy. I think that’s what Steve was talking about for opportunity costs.
You can’t just look at the flows on a balance sheet: “Well, we’re getting something for nothing.” If you import more than you export, you’re running up foreign debt, and you’re becoming more and more dependent on foreign countries who are acting in their own interests, not your own interests. So you have to put this whole discussion in the political context.
[00:16:15.210] – Grumbine
So I would see this as a national security issue in that with these essentials – Fadhel Kaboub talks about the spectrum of sovereignty: energy sovereignty, food sovereignty, technological sovereignty, the ability to live without external supports. And each country has varying levels of that. And so each country would have to be looked at differently just based on what they’re even capable of producing.
I guess my question to you, as we think about countries in the global South that have had the kiss of the IMF on them and the debt peonage that they have been laboring under. In Africa, Sankara’s speech talking about “I can either pay you or I can feed my people.” You can see the role that US interests through the IMF have had to import their goods and services into our country.
They don’t have a choice. They are basically colonial states that have the US thumbprint on them. So the United States has exerted this imperial power in this geopolitical nightmare. We are watching them break away from that today.
[00:17:34.050] – Hudson
But you’re leaving one of the real villains in the piece, and that’s the World Bank.
[00:17:38.290] – Grumbine
[00:17:39.020] – Hudson
A central element of the World Bank from the beginning is to convince countries not to grow their own food, but to create plantation agriculture, to prevent family-owned farming of food, to grow plantation export crops, and to become dependent on the United States for their grain. Well, if imports are a benefit and imports mean that the United States can put a sanction on you and starve your people like the United States tried to do in China in the 1950s, do you really want to become import dependent on food?
Let’s compare the World Bank to the Chinese Belt and Road and the BRICS bank that’s proposed. The World Bank would only make foreign exchange loans. That meant it would only make loans to countries who would invest in infrastructure that would help its exports. Well, imagine how this works for agriculture.
If you were going to develop your agriculture in the global South countries, you’d do pretty much what the United States did in the 1930s that had the most rapid increase in productivity of any industry in the last few centuries. And that was because the government took the lead in agricultural extension services, seed testing, educating farmers as to seed variety, setting up local farm management organizations.
Before the time that Cargill and Archer Daniels Midland became the great intermediaries in promotion of domestic self-sufficiency for farms, the World Bank wouldn’t make any loans at all for this, even though the World Bank local commissions and reports all said that this is what they need. The World Bank was almost always headed by someone very close to the US Military, starting with John J. McCloy at the beginning and going through McNamara and all of the subsequent Pentagon people who were put in charge of the World Bank.
And above all, they wanted to continue to base America’s export boom in agriculture and to make other countries food dependent. And that is one of the things that has led them into debt. So if you have a country like Chile that has the richest land in the world because it has the richest supply of guano deposits in the world. It also has the most unequal land distribution in Latin America – latifundia and microfundia – not any kind of balanced food production.
So that all of Chile’s exports and copper, by specializing, have been overwhelmed by the costs of importing food that it could have grown all by itself. So the idea of free trade is shaped by what will the international organizations controlled by the US give credit for, ends up to create underdevelopment and dependency instead of development. And that developmental aspect is a different story from MMT money creation. And we’re talking about something else that is part of a much bigger system.
[00:20:43.410] – Grumbine
Steve, based on what Michael just said, I know that you are concerned with the environment and bringing production back home. And around the world, people that are not hip to the US empire are trying to convince countries to look at building bonds between each other to create trade zones that mitigate some of the US power over dominating their countries.
We’ve got a very tiny window to solve climate crisis as well. So all these things are converging at one time trying to deleverage US interests from the world interests and watching as the nonwhite countries are banding together and the white countries are banding together. And it seems like the opportunity to save ourselves from extinction is passing before our very eyes.
In the vein of what he just said, how do we marry some of the ideas that we have, the climate crisis with the geopolitical crisis that we’re battling here?
[00:21:49.110] – Keen
Well, the large part of it is that the focus of neoclassical economics has always been on specialization and doing it with so-called comparative advantage. And what that gives you is an incredibly fragile system, as we’ve seen with Covid, because if you actually distribute production across the planet and you have a long supply chain, then of course that can collapse in an instant with something like Covid coming along.
And equally, if you have a famine, if the major food baskets get wiped out by a famine or a war. We’ve got the war already. The famine may well come by a drought and a crop failure as well. Then suddenly you can’t feed your people and you have no domestic alternative. So I think we have to get away from the focus on efficiency and even in that sense, the gain of swapping paper for goods, which is part of the MMT slogan.
Start thinking: no, we need to be resilient and capable of handling a range of different disturbances which could come our way. And on that basis you need to have your production local.
[00:22:47.310] – Grumbine
So within that space mitigating some of the travel carbon footprint expenses that clearly solves one problem. But where you had smokestacks to create basic amounts of goods and services in one country, now you’re building smokestacks across the globe and I don’t see any meaningful effort to green technology to make those things happen.
I am curious what decentralizing production does in terms of the carbon footprint and how developing local supply chains will in turn impact our ability to stave off climate crisis.
[00:23:30.090] – Keen
Yeah, if you look at just the shipping involved in international trade. It’s something at the order of 20%, I think, of our carbon production comes out of the entire mechanics of shipping goods around the planet, and we realize we’ve massively overshot the capacity to support our industrial sedentary civilization. So one way you can reduce that is by reducing international trade.
I think that’s what’s going to start happening, partly because you have the example of Cisco. You suddenly wait a year to get a piece you used to wait two weeks for because of the breakdown of the supply chain. The same thing will become even, I think, even more extreme when climate change forces us to drastically reduce our production levels.
If you don’t have the domestic production capability, you’re going to lose the possibility of those goods. And in some cases, we have to drastically reduce our consumption of a range of goods. Automobiles is an obvious instance of that. But in others, we want to continue – and food production is one of those. Clearly, you want to produce your food locally.
So, again, I think we’ve been very blase about the physical side of production, and that’s what I would like MMT to start looking at. And in that context, I think it might change the attitude about imports and exports.
[00:24:57.730] – Intermission
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[00:25:49.010] – Grumbine
Michael, in the Russia example, where in one fell swoop they get cut off from the SWIFT system and the US is beating their chest, “We’ve got Putin on the run.” It doesn’t look like Putin is on the run at all right now.
[00:26:02.900] – Hudson
I’m glad you’re bringing up the NATO war against countries resisting neoliberalism, because you use the word “green.” And the European Greens basically are advocating two fuels of the future: coal and cutting down the forests. Germany, by blocking Russia’s gas, they are essentially replacing Russian gas and oil with Polish and Ukrainian coal – and digging down the forest.
I’ve walked very often through German villages, and most houses have whole stacks of cut-down lumber that they essentially burn in their fireplaces for heat. You’re having an enormous deforestation and replacement of gas with coal. And the Green Parties are the advocates for the major polluters in the world, and they’re the advocates for global warming.
And that’s because they’re part of the Cold War attack on Russia. And they say it’s worth having global warming as long as we can fight against countries that resist neoliberalism and resist the American European takeover. So you want to realize the politics – that the Greens of Europe are not friends of the environment.
Now, to get back to your question about the isolating of Russia. Isolating Russia hasn’t isolated it at all. It’s driven Russia together with China, in the first instance, and then China and Russia together have joined with India, Iran, Syria, they’re now joining with Brazil and Argentina all to create an alternative economic order and social order and political order.
And the political order is basically based on the main distinction between the non-neoliberals and the neoliberals, and that is: who will control the money supply. And China is the prime example. Instead of private banking creating the credit to create loans basically for financial reasons, China will create credit to spend into the economy the way that MMTers hope to see credit created.
Namely, spend to hire labor, to make new means of production, hopefully in an environmental way, as opposed to the commercial banks that look at “how do we make money in the short term?” Well, you make money in the short term by cutting down the forest of the Amazon. You don’t look at global warming.
And already you’ve had the heads of American oil companies and investment firms say “what do we care about global warming ten years in the future? We care about the next three months’ earning statement, and the next year. Ten years from now, the sea levels go up. We can deal with it then.” So you’re dealing with two different economic philosophies and as the world divides into these two different economies, this is an important element.
And as Steve just pointed out, neoliberal economics doesn’t take into account the environment because that’s long term. Economists call that exogenous, meaning it’s outside our tunnel vision. And the question is whether you’re going to look at the world economy as the overall system interconnected, which is what Steve and I do, or whether you’re going to say we’re going to just cut the financial sector apart and only look at the corporate and financial sector of how to make money quickly.
That’s really the difference. So obviously Russia was not really troubled very much by being cut off – or even by being isolated. What America is doing is driving Russia together with all of the countries that have refused to condemn it. And America basically is creating an iron curtain, locking these countries – isolating them from Europe and the United States – going their own way, which I don’t think Russia and China are unhappy to see occurring.
[00:29:54.480] – Grumbine
I completely agree with that. The idea that the US thinks they are going to knock these giants down and they’ve just said we’re going to invest in our own country. Instead of being a cooperative society, we see this as a combative society. We decided we have to fight them and create cold wars to isolate them so we can catch up.
But you nailed it with the concept of the private short-term thinking that private collateral, banking, loans, filling short-term needs because we can’t see out as far as those folks because they aren’t living and dying the same capitalist way that we do things here in the United States. They have invested in the public purpose.
China has got the ability to do just about everything. Do you think it’s going to take us getting our proverbial asses handed to us by the rest of the world to wake up? Do you think we’ll ever wake up? Or this is just the way it will always be, at least until tsunamis take us out?
[00:30:56.870] – Hudson
Who is the we? Who’s going to wake up? When you say we, it’s as if you mean American citizens in the population. But we are not the government who makes the policy. We are not the Davos Group and the campaign contributors. Their “we” are the oil industry, the big agricultural monopolies, the other monopolies, and Wall Street. That’s the finance, insurance and real estate sector [FIRE].
And they are going to just continue doing what they want. And you’ve seen from the recent Supreme Court rulings in the United States that the government is not permitted to enforce any climate preservation rules. That has been ruled unconstitutional unless Congress can pass environmental law. And in order for Congress to pass a law, as opposed to just an executive branch joining the environment, you have to have 60 out of 100 votes.
American dual politics doesn’t permit either party to get 60 votes unless there’s a landslide. And the only party that has a prospect of getting 60% would be the Republicans. So basically, even if the people wake up, the government people and their campaign contributors are just going to continue to make money to live in the short term. That’s what differentiates neoliberalism and socialism.
[00:32:17.630] – Grumbine
Very well stated. To me, I think of this as war. Murder. I don’t think of this as some polite gentleman’s disagreement. I see this as wanton death and destruction, all in the name of profit. How do we stop this? Can we stop this? Congress is bought and paid for. Our government, our Supreme Court doesn’t represent the people, and the President has proven to be a feckless neoliberal as well.
I see nothing to feel any sense of hope, and I’m not sure that hope is a requirement. It seems like the only alternative we have is in the street, is to become ungovernable, is to get rid of a government that is no longer representative of the people.
[00:33:04.010] – Hudson
[laughs] Well, Steve’s gone to Thailand and I’m dealing mainly with China. That’s how we’ve coped. [laughter] Neither of us are going to be President of America.
[00:33:15.690] – Keen
No. The American political system is almost designed to stop anything being done. I was involved in the Australian election recently, as you probably remember. And though my party did extremely badly and money still was obviously vitally necessary to get a political profile, even in countries with good electoral systems, Australia does have a good electoral system, and America has got the best electoral system money can buy, and that’s a disaster.
It’s hard to get away from money enabling parties to have political position to be seen in the media. And that’s actually a great reason for MMT: create money for publicly financed election campaigns rather than having it out of private pockets. But given that, you have an electoral system where you don’t actually vote for anybody, the electoral college piece of nonsense, which itself is crazy.
Every state has got a different system, which is crazy. You don’t have the central bureaucracy handling the voting system, which is crazy. And you have gerrymandering because the boundaries are decided by local political groups, which is crazy. So the extent to which America needs to reform its political structure to approximate a democracy is ridiculous. And that’s partly why money interests can so easily dominate what happens in the American political sphere. And right-wing religious ideology as well.
[00:34:43.950] – Grumbine
Absolutely. The Calvinistic bullshit in this country is over the top. But there’s a tone policing aspect to this. I think there are people out there who don’t understand that this election system that we have in the United States isn’t getting us what we want or need. They think they just need to phone bank harder, vote harder.
Fact is, in my 53 years, I have not seen any meaningful legislation passed. I do not consider the ACA meaningful legislation. I’ve seen a lot of bad legislation pass that hurts us. And this is not really intended to be an America-centric show, except that America seems to be the big bully. It’s creating a lot of the problems. It’s got its own citizens in hell and it’s trying to create hell on earth for the rest of the world.
I spend a lot of time trying to get this information out the door. It’s very important information, but it’s only important in the sense that it’s good to know. I don’t see any of it amounting to a movement, a passing of legislation. We can tell people that if we don’t consider the economy in the world as a superorganism and degrowth, we don’t have anybody thinking this way.
[00:36:00.090] – Keen
There is actually – I don’t know the name of it, but I do know that there’s a political group in America which is campaigning to have Australia’s electoral system adopted by America. Have it include an electoral commission that determines borders between one electorate and another, a single centralized system that counts the votes rather than the crazy range of stuff you have at the state level.
And controls on the size of electorates so they can be no more than 20% larger or smaller than a target – and they should be 10%. And then preferential voting so you don’t just vote for one candidate, like if you vote for the Greens in America, you guarantee the Republicans win the election because the Green votes are taken away from the Democrat.
So have preferential voting, which means you can actually put the party you prefer first and know that the party that’s your fallback will actually get the vote if your first party doesn’t get up. So all these sorts of reforms. I know that there are people who are campaigning about it because the frustration that you’re expressing is very widely felt in America. But of course, try getting that through a Republican-dominated Congress. It ain’t going to be easy.
[00:37:01.170] – Grumbine
No. It does leave you wondering if this is not just political theater. I talked to Warren the other day and Warren asked the question to me. He said, “you ask, are they doing a good job? And I answer back, well, for whom?” Somebody’s doing okay right now. It just isn’t the regular people in society. Somebody’s doing great, though. And I don’t see a path. As much as I want to, I see no path forward.
I don’t want to feel this way, but I don’t see a path forward. Michael, with your international perspective, I guess my question to you, given the fact that you’re focusing on China and you see the US through the lens that we’ve just discussed, do you see an ending to this that is positive for the world, that gets us to a successful conclusion, meaning we survive? Do you see any hope whatsoever in changing that narrative? And if not, what’s next?
[00:38:01.530] – Hudson
There’s no path forward in the way that we’ve been talking about because the suggestions that Steve makes cannot be legislated by Congress. They are limited by the Constitution. And in order to do what Steve recommends – very good ideas – you would need a new Constitutional Convention. The right-wing, the polluters, the monopolists, the bankers, have been preparing for a Constitutional Convention for about 30 years, and it wouldn’t be very nice.
[00:38:32.370] – Grumbine
[00:38:32.370] – Hudson
Our Constitution in America was written for the slave owners to permit any states to block any federal power because they worried that the federal power might try to free the slaves. Well, now that element of the Constitution, of state’s rights, is enabling the oil industry, the polluting industry, the banks, the credit card companies to essentially prevent any solution along any lines except those of the ultra right-wing.
But the problem goes beyond America and beyond Europe. Western civilization took a wrong track about 3000 years ago. The Near East and almost all of Asia had a tradition of canceling the debts when they threatened the economy. In Japan, you had revolutions, you had the Near East rulers canceling the debts. That’s what my books are about.
And you had essentially the jubilee years throughout the Near East. And this promotion of economic growth and in effect, prosperity, was always run by a central ruler. There had to be a ruler, the job of divine kingship or undivine kingship, throughout the Near East, Asia, all the way to China. And India. All of these cultures sought to prevent a commercial class and a financial class from emerging and taking over.
And the merchant class was realized as playing an important role, but it was not allowed to dominate society. But around the 8th century BC, when Syrian traders began to move into the Aegean and Mediterranean to Greece and Italy. There weren’t any kings. The west didn’t have kings. They had local chieftains who were a Mafia-type society.
And the result is that ever since Greece and Rome, you had a completely different set of laws and legal philosophy than what you had in the Near East and Asia. You had pro-creditor laws making what is called the security of contracts and the irreversibility of land being forfeited to creditors. And the result is you had creditors oligarchy evolving.
So when President Biden said the current war of NATO against Russia and China is a war of democracy against autocracy, what it means by democracy are Western civilization’s oligarchies. There haven’t been any democracies, really – maybe very briefly in Athens – but the Western cultures are all oligarchies. What he calls an autocracy is a government strong enough to prevent a financial oligarchy from developing and taking over the land and taking over politics and making its own laws for itself.
And it’s a civilizational difference. And both Steve and I have spent a lot of our time talking about how the Western economies cannot evolve further without a debt write-down, without writing down the debts that are of the 99%, they’re owed to the 1%, the oligarchy that’s controlling all of Western politics. Asia has a way to go a different way.
China doesn’t have a financial oligarchy because it treats money and credit as a public utility through the Bank of China. And so the Bank of China, as we said, makes loans to actually develop the economy. And that’s what Russia says it’s going to begin doing, not to create a financial class to make money at the expense of the 99%. So we’re dealing with a civilizational problem.
And the question is, which form of civilization? Can you rescue Western civilization from the wrong track? Well, only by creating an alternative on the right track and leaving Western civilization and say, well, you’re missing out on the development. Do you want to continue in poverty or are you going to have a revolution?
[00:42:31.650] – Grumbine
You’ve seen yellow and blue profile pictures for everybody totally sympathetic to Ukraine. And our government saying “we are not going to abandon them no matter what.” Biden has signaled that we have unlimited money to give to Ukraine, and he can’t possibly write down $2 trillion in student debt. This weird split dichotomy of truth and lies passes right by the average person.
With what you just stated, which side is going to win? Sadly, the bad guys seem to always win. I rarely see the good guys win. Who is “the good guys”? In full disclosure, I’m a socialist. We don’t even have a left party in the United States. There’s no appetite for that kind of thing in the United States. And those of us that want it are the minority. How do you envision this playing out?
[00:43:26.670] – Hudson
I thought I just said it: a different civilization going its own way.
[00:43:31.740] – Grumbine
Well, what you said was the question of good and evil, basically, which one is going to win? I’m asking you, how do you see it playing out? Because the US can’t continue doing what it’s doing and grow. You need the debt jubilee. We’ve chosen not to. Asia has those systems built and they have choices. So the question I’m proposing, given that, do you see any chance of the US coming to grips with itself? Or do you see this being a one-way trip to destitution?
[00:44:03.570] – Hudson
[00:44:05.010] – Grumbine
[00:44:05.830] – Hudson
That’s all I can say. There is no sign at all of a change. The fact that Steve and I can be on your show – we are not published in the major magazines anymore. We’re not on the major network shows. What you call the bad guys always call themselves the good guys. What you call evil calls itself good. So the question is, what kind of good guys you’re going to have?
The good guys that want to blow up the world and impoverish society, which is what neoliberalism says are the good guys or the good guys for the 99%, which America says are autocracies that we have to fight?
[00:44:41.830] – Grumbine
[00:44:42.670] – Keen
I think I might put a bit of a perspective. People often say, “what’s your alternative?” And what they really mean is “what’s your alternative that I’m going to like?” And I think there is an alternative, but as people feel, “I don’t like it” then other people won’t like it as well. And that is that given the scale of the environmental crisis we’re facing and the fact that it’s coming far sooner than we’re being led to believe, because courtesy of believing their classical economists on it.
When it hits, the countries that are most likely to survive will hold together are those that the West calls authoritarian. And the defining feature of those cultures when you’ve actually been inside them, is that, yes, there is a very strong state and yes, it tends to get its own way and people do what they’re told to some extent, but it’s because at the same time they know they’ve benefited from that state.
So back in China, when you talk to people in China, they will be critical of the Communist Party and say at the same time, the industrialization since then has been incredible and their lives have improved radically over that period of time. I know people who were literally in Mao suits in 1969 who are having a very comfortable retirement when they faced far worst terms back under the old strictly communist regime.
But what you have with a country like that is if China decides it has to radically ramp up renewable energy resources, also install nuclear if necessary, it’s going to do it and not face the opposition the German Greens give to new nuclear power stations, for example. So the capacity to have a top down society is more likely to be then you’re going to survive the crisis that comes forward from climate change.
I can’t see countries that call themselves democracies succeeding in that situation because they will not be able to agree on the level of cutback that’s necessary and who it gets imposed upon. We’re a more centralized society. We’re more successful at doing that and more likely to hold together during the downturn the climate will cause.
[00:46:40.110] – Hudson
You need a strong enough government to check the power of an oligarchy and to prevent a creditor landowner oligarchy from developing. And libertarians, while pretending to be for liberty, they’re for a centrally planned economy, but a centrally planned economy by the oligarchy, by the financial sector, and by the real estate owners. So every economy is planned. And the question is, who’s going to do the planning?
[00:47:05.190] – Grumbine
Yes. And with that in mind, I want to read to you some stuff that came out of this NATO 2022 Strategic Concept – just so that people understand exactly how bad it is. Document defines Russia as the most significant and direct threat to the allies’ security while addressing China for the first time and the challenges that Beijing poses towards allies’ security interests and values.
Documents also state that climate change is a defining challenge of our time. Strategic Concept is updated roughly every decade as NATO’s second most important document. It reaffirms the values of the alliance, provides a collective assessment of security challenges, and guides the alliance’s political and military activities. Previous version was adopted at the NATO Lisbon Summit in 2010.
Point I’m making is they’re bringing more countries in and now setting up China and Russia as the bad guys. This has been going on for a long time, I guess Reaganism with the Cold War. And you brought it up, I think it’s worth mentioning, towards the end of the Chinese Revolution and the US efforts back then to do these same things to China then.
All these institutions, World Bank, IMF, the Peace Corps, all these different NGOs, these were brought out as a direct counter to Russia’s communism and a fear that communism would spread to the global South to prevent them from getting in bed with the Russians. But our country, the United States in this case, has been instrumental in setting up these shadow organizations to prevent any kind of socialism or people-led initiatives around the world.
And it seems like this is going to become the next war. If it’s not going to be just another Cold War, it’s definitely going to be some war because they are lining up the Axis and allies already. I guess. Take us out on this note.
[00:49:13.290] – Keen
I think I take it over a different angle and say that the global politics we’ve had over the last 80-100 years, actually, since the dominance of America, which we pretty much say from the end of the Second World War, has been completely oblivious to the impact we’re having on the planet. The biosphere itself. And the biggest political player on the planet is the biosphere.
And that’s going to start determining what the wars are in future. And I don’t think any country in the world is prepared for that battle. China has maybe probably the most effective capacity to respond to the challenges that are coming this way, but there’s no way America or Russia or anywhere in Europe are aware of the threats they face.
This is a warfare against an implacable foe which we’ve created by destroying the sustainability of the biosphere, by expanding human industry to three to four times the scale that the planet could actually support. That’s the real war that is coming our way.
[00:50:08.600] – Hudson
And Steve, you mentioned how global shipping and trade adds to the global warming. Obviously, the military spending is a huge, huge factor. So the Americans and the Green Parties of Europe are on the wrong side of history. They are doing just the opposite of preserving de-development. They are the advocates of more and more global warming. So literally, you have a group, a bloc, wanting to destroy the environment and a bloc trying to protect itself from the Western destruction.
[00:50:40.830] – Grumbine
Yeah, very scary. And then we’ve got a lot of folks that think that they’re going to appeal to their greater sense of reason to get them to suddenly stop all this, vote their way to a Green New Deal, and it’s all just going to go away. Gentlemen, thank you so much for this time. I really appreciate it. It’s rare to have two such phenomenal guests at once, so I really do appreciate this immensely. Michael, tell us where we can find more about your work.
[00:51:07.230] – Hudson
Well, on my website, michael-hudson.com, and on my Patreon account. Steve also has a Patreon account. He got me onto Patreon. And the books that I describe what we’re talking about are available on Amazon. The Destiny of Civilization and Super Imperialism.
[00:51:27.450] – Grumbine
Very good. Steve, I know we got you on Patreon, but tell us a little bit about your books and where we can find more of your work.
[00:51:33.710] – Keen
Okay, well, again, my main recent book is The New Economics: A Manifesto, and that’s published by Polity press. So you can get it through Polity or you can get it through Amazon. There’s more than one way to get a hold of it. And the main thing I’m doing is developing the software package to enable us to think about the economy the way we should think about it, which is dynamically, non equilibrium, monetary and so on.
And that’s Minsky, which people can find at SourceForge, the open source software package site, SourceForge. Search for SourceForge and Minsky together and you’ll find it. But those are my main two things. I’ve also opened up a substack account recently – profstevekeen.substack.com – mainly because Patreon loses a lot of customers by stuffing up their credit cards. So Patreon, Substack and Minsky.
[00:52:18.030] – Grumbine
Very good. All right. And with that, my name is Steve Grumbine. My special guests, Steve Keen and Michael Hudson. This is the podcast Macro N Cheese. We’re out of here.
Contrary to popular opinion, there is no climate crisis.
It is only 15,000 years since the ending of the last ice age. Where I live in the Hudson Valley it was covered in a mile high ice sheet / glacier. Long Island came into being as its terminal moraine as the ice retreated northwards.
Changes in the temperature of the earth’s biosphere are largely influenced by the Milankovitch cycles: the earth’s axis tilt that varies in a 40,000 year cycle from 22.1 to 24.5 degrees to the plane of its orbit, the precession of its slightly elliptical orbit, and variations in the electromagnetic radiation from the sun.
Increased levels of CO2 in the gas atmosphere, now at 0.04% have little to do with warming.
Warming of the oceans precedes increased CO2 levels in the gas atmosphere, since CO2 is less soluble in warm water than cold. The loose correlation between two variables in a dynamic system, does not tell us which one is the cause and which one is the effect.
CO2 outgases from the ocean’s equatorial region and is absorbed at the higher colder latitudes. In any case CO2 is a plant food, since without it, photosynthesis by plants would not be possible and all plant life would die off. The increased CO2 levels have increased crop yields, that have never been higher.
The earth’s climate is controlled by the oceans that act as a heat sink and as they have warmed there is increased evaporation from the surface, that causes cloud formation at higher altitudes, where it is colder – the lapse rate. Clouds cover 51% of the surface and they reflect radiation from the sun back into space.
If you are located in the Hudson Valley (as you indicate), then you are located somewhere in mid to lower eastern NYS. And I would wonder if you have seen your skies there covered with chem trails, as they are very often here in central NJ.
If so, I would appreciate reading your thoughts on the impact of this activity (I have witnessed the sky go from linear zigzag pattern to an entire sun-blocking overcast) on the topics you raise;.
I would also appreciate your thoughts on aerial disbursement of these particles for human health and the health of our “never higher crop yields” when these chem trail (nano?) particles (primarily aluminum?) fall to earth and are ingested both by the crops themselves and by us.
I live forty miles north of Manhattan.
They are not “chem” trails, they are condensation trails.
These days there are fewer flights across the sky, but those coming over at their cruising altitude of 35,000 feet on a clear day emit condensation trails from their engines as a result of the combustion of jet fuel to steam and CO2 plus a little NOx. At that altitude the air temperature is at minus 69 deg F and therefore the steam rapidly condenses to ice particles. If you look closely you will notice there is a transparent gap between the engine exhaust and the appearance of the ice particles due to the finite time it takes to cool down.
The condensation trails are very similar to cirrus clouds that eventually disperse into the atmosphere depending on wind direction and velocity. During the day these clouds reflect sunlight back into space that lower the daytime high, and at night reflect radiation from the earth back down again to raise the night time high to a small extent.
When there was a suspension of domestic flights after nein eleven, the skies were a deeper blue and the diurnal temperature range increased slightly.
No one in their right mind is going to inject aluminum into a jet engine air intake as it would damage the turbine blades, that are made of super alloys of high purity and very expensive to manufacture.
40 miles isn’t enough!
Yes, I sometimes worry about that, but these days nuclear weapons have been miniaturized, so that mass destruction is not necessary, but pinpoint use of these devices could change the course of history by eliminating the neocon warmongers sitting in their armchairs in Washington DC.
I am equivocal on “chem trails” . I do think if the powers that be could use them for nefarious purposes they certainly would. I too wondered about the harmful effect of added ingredients into jet fuel on the turbines. The chem trail people say they would be added into the hot exhaust stream as it leaves the turbine – entirely feasible. Air Force types have been wondering since the 50s how to get jets not to leave the condensation trails as they make the jets so much more visible to the naked eye. I still wonder at why on days there are such weird patterns made by the jet;s condensation trails. I need more evidence to believe the chem trails people tho. What exactly is it they are alleged to be putting into the chem trails and what does it do to people?
When it comes to economics, Hudson and Keene are economists I like to hear what they have to say. It is too bad they don’t consider that mainstream climatologists could be as wrong as mainstream economists and going along with an agenda.
Is climate change the work of God? An interesting question which unfortunately never gets discussed. Perhaps it should because the volume of information in the bible is simply enormous. Covers everything about it in fact and in a few places gives us the actual solution to climate change. Moreover, in church history one will find fascinating eye-witness accounts to. If one wishes one can start ones re-education on the subject here:
further that Icestorm of the Century that buried Manhattan in 1998-1999 its explanation can be found in of all places the Book of Job!
History repeats itself ?
The weather and the seasons are cyclical, and so is the climate. Ice ages come and go.
I have always been impressed by the Book of Genesis.
If I remember correctly, without looking it up:
“In the beginning there was the void, and then God commanded ‘Let there be Light’
This is in fact almost the same as the Big Bang Theory that describes the origin of the universe 15 billion years ago.
I just finished reading “In Search of the Big Bang” by John Gribben.
If, by “god” you mean the Universe, then yes. Climate is the work of the universe.
For us humans, we can say it’s just systems-emergence.
When you commit the fossil stores of energy to discharge, the temperature of the system will rise.
This is just the second law of thermodynamics.
Usually, this additional thermal energy would just radiate into space, but the CO2 which accompanies the entropization of carbohydrate fossil fuels prevents that radiation – and the general climate warms.
The properties of this universe are the properties of the universal body of the god which we inhabit. Those properties express as physical laws which will not be broken – because they form a system in which sacred life emerges – and sacred life is part of the body of the universal god.
The extinction of humanity will be just another extinction. The sacred emergence of new life will be just as sacred without us. We will not be the first species to extinct itself to make way for the next. While we have life? Live it. Join the sacred dance! Death is the last step for all lives – and the universal god rejoices in that we lived.
Ice age? You mean the great flood when God covered the earth with water. There’s no evidence ce of ice age just like there’s no proof of that so called holocaust in Germany all those years ago.
I couldn’t listen to the all American crap music, wiz bang, pod cast.
This is a feast of a presentation by really knowledgeable people and you all speak about climate change?
But what gets my goat even more, is that there is little understanding of the part of climate change that the usual suspects want to commoditize and sell back to us, and a real change in our planetary affairs. Yes, the permafrost in the northern parts of Russia is really melting. Yes, the northern passage is more and more becoming navigable. These are not dreams – but real visible changes.
Thing is, I listen about planetary changes when a farmer that farmed the same area for 40 years tells me about it – and this is but short-term and a drop in the ocean and not long-term processes. But it does become real when a farmer that you’ve known for all your life, from an area where you grew up and know the climate like the back of your hand, tells you how the planting season has shifted and changed, and the rainfall pattern has shifted and changed.
The thing that I cannot abide from the two sides of climate change, is that most that talk about it are unable to grow a houseplant.
I enjoy reading Michael Hudson’s articles on economics and heartily agree with his positions thereon, but he is clearly not a scientist in the STEM sense.
My comment on climate change was to alert him to the reality of how climate and life have co-evolved over the past 4 billion years enabling plants and animals exist in a symbiotic relationship. No disrespect whatsoever was intended.
These chattering voices speak of climate change, reflexively triggered by the mere mention of the term, because they are ideologues, which is the human equivalent of a slot car.
An excellent interchange in the transcript, of utterly crucial ideas and perspectives… for those able to read was actually in it rather than being besotted by the white noise in their head.
I sometimes wonder whether “Climate Change” gets promoted to stop us thinking about Steve Keen’s
“This is a warfare against an implacable foe which we’ve created by destroying the sustainability of the biosphere, by expanding human industry to three to four times the scale that the planet could actually support. That’s the real war that is coming our way.”
And how do we incentivise the economy in the right direction? I’ll suggest reducing deficit spending, but that’s just me.
BTW I agree on the condensation trails. If aluminium is a concern, you may want to research silica rich mineral water.
I agree with you that in essence, CO2 is not the control knob of the Earth’s climate. That large graph of ice core]s temperature and CO2 levels in Al Gore’s movie tell the story. When I looked it up so I could examine it closely I found that CO2 levels follow the temperature not temperature following the CO2 levels. I was confirmed by a study by actual scientists saying that there is a lag of up to 800 years of the CO2 following the temperature in all the ice core studies.
Up to 2000 or so most all climate scientists said yes the global temperature warmed since 80s but only a few extremists are sure that it will cause catastrophic climate change. This has changed but the only “evidence” is from computer climate models. I did notice how instead of global warming the words were changed to climate change. Climate change happens all the time for many different reasons. Most people tend not to differentiate between extreme weather events and actual climate change.
This is not to say that our present economic system is not causing often severe environmental problems. Over fishing, glyphosate pollution, Fukishima since 2011 is putting thousands of gallons of radioactive water into the Pacific Ocean eveyday. Turning the Amazon into cattle ranches and genetically modified soybean farms etc. Real problems as who even knows what would be the best global temperature for the Earth.
To Amarynth. Again I must offer to you my sincere appreciation for posting the transcript of this podcast presentation.
Thanks Soleii. It is by the grace of Prof Hudson that we get to post these with his permission. I’m such a Hudson groupie, so, I always enjoy getting these up in front of the Sakerites.
“And for countries like the United States, we do have Most Favored Nation status in the sense that we are the primary world reserve currency.”
It always strikes me that the hubris of Americans is embodied in this sentence, as if the Empire of Lies is not self-destructing before out eyes, and only those Americans wearing rose-colored glasses like Steve G are in a world of fantasy. Perhaps they have never outgrown their “Santa Claus” childhood. Or had it too good for too long. In a bubble of comfort and denial.
MMT has about a much credibility as crypto currencies. Steve G would like unlimited money creation to infinity, but without inflation. That’s like eating 1000 cream-filled cakes a day and not getting fat. So fat you die of a heart attack.
Inflation by definition is inflation of the supply of money into the financial system. Without constant expansion of the money supply there is no liquidity, no credit, no growth. Like the fat man the system dies. Central banks raising rates recently is a token political effort, and soon they will all reverse course and print again to infinity making this the final act of currency destruction.
It’s always such a blast to see Hudson and Keen on the same panel together.
Steve and Michael are in close personal dialogue, but they rarely get to compare notes live for us to gain their combined insight!
Now in the light of the reality of trade balances we see evolving in the case of the unilateral sanctions on Russia, we see how it plays-out when a nation possesses true resource independence and has effective immunity.
From my lay perspective, I have worked to try to distill some conceptual statements that help resolve understanding of the fog and obfuscation that surrounds everything economic and monetary:
1. Money is not value – it is CLAIMS on value.
For instance, Putin says: “IF you want to claim the value of Russian Gas? Show me the Rubles?”. What need does he have for US or EU paper if the CLAIMS in them is not honored by USA or EU?
2. All power IS POWER. Be it muscle, solar, wind, hydro or fossil-fuel. It is power – because you need it for everything – EVERYTHING. All work requires energy – it’s just physics.
If you have to get your power from someone else? That “someone else” will usually expect an equivalent return – unless you have taken it by force.
For instance, the EU and UK failed to understand the sheer privilege they enjoyed by Russia deigning to supply their energy at such a reasonable price. Now they are left to comprehend where their power came from in the first place.
And now they consider their options to Force Russia and find themselves lacking the means.
So now, we will watch them all fall as their lights go out.
3. All Lives exists by the harnessing of Entropy. Some part of the tropic flux is spent to create stored potential which may be discharged at the right moment to keep that life going. Life is the only exception to the ongoing flow of entropy in the universe, but it only does so by shifting the flow – and the overall flux is preserved.
For instance, the increasing use of the stored potential in fossil fuels represents a local acceleration of Entropy on Earth without creating any corresponding store that life will need in the future.
The result is rising temperature within the Earth system, and the denial of opportunity for life to have sufficient stores into the future.
Once again, this is all just physics – and as Keen often says: “If your model does not conform to the laws of thermodynamics? It’s a junk model!” – such as DSGE neoclassical/neoliberal economics as proposed by idiots like Hayek and Friedman.
Marx had an inkling when he observed use-value and exchange-value. The neoclassical fools attempted to obscure the divide between needs and wants – simply to justify their own profligate conspicuous consumption. And hide it all in the maze of fetishist exchange malarkey of the FIRE sector. The religion of privilege. i.e. class war.
For myself, I find an intrinsic risk in the centralization of power. Democracy seemed to be a tool to prevent corruption, but now seems we need something more.
Entropy is the tendency for things to wear out or degrade from order to disorder.
The way that humans fight entropy is to use the heat energy from the sun to build order.
Remember though energy and and mass are equivalent as Albert Einstein pointed out
Energy = mass x velocity of light squared
The early universe 15 billion years ago began to expand and therefore cooled, so that protons, neutrons and electrons condensed out of the energy field to produce 80% hydrogen and helium 20%.
The mass of these two elements produce gravity so that the gases were compressed. When you compress a gas it heats up and that is how stars are formed to undergo nuclear fusion (nucleosynthesis) to produce the other 98 elements in the periodic table.The fusion reactions convert mass to energy, that we enjoy as sunshine.
Entropy is misrepresented in terms of order and disorder.
Newton told it in terms of the mixing of gasses. That they will seek homogeneous mixing.
Many humans see order as homogeneity – so the very concept of “order and chaos” are subjective.
Few understand that this universe is created by collection and dispersion – and math tells us that the collection can only occur in mathematical chaos – thus chaos contains order – as a systemic turbulence in Entropy.
Since Newton, Boltzmann got a good step forward in how to measure entropy – in a closed system. (add note that the Entropica people have used the Boltzmann formula to define “intelligence” with significant results).
There are no closed systems in this universe. However, we observe systems that are “nearly” closed in a very many cases.
My observation is that each system is defined by the “membrane” which exists between a “nearly closed system” and the context which contains it.
You have a skin – you are in it. Yet you have to draw in breath and food and water from outside of you.
So it is with all systems.
Life manages the entropic flux by moving tropic flows to allow “bubbles” of delayed entropy in which it can persist.
Since you were the only reply to my statement in this very rare space with any kind of understanding:
Observe the membrane – this defines all “selves” because it regulates what comes in – and what goes out. IF enough comes in to allow options for persistence? It survives to reproduce. If more goes out than in? It’s envelope deflates: death. If more comes in than out? It inflates to the point of explosive rupture:death.
Life is a non-linear cascade of life and death.
The aggregate persistence of life in this universe is a statistical bias that is so slight, it can only be expressed as “not nothing”.
And that is enough to create the universe(s) from null void.
Think on it?
What Einstein did not realize at the time he came up with his theory of relativity is the universe is not static, but expanding, later proven by the analysis of spectra from distant galaxies that show a red shift. The most distant galaxies having the largest velocity away from the observer. This also indicates the rate of expansion is slowing presumably due to the effects of gravity. To me, at least, it implies that the expansion will eventually stop and reverse course and end in a big crunch where it first began, and the whole process repeat itself.
The relentless destruction of the earth’s ecosystem by neoliberal capitalism is as obvious as the relentless destruction of the Ukrainian army by the Russian. How can we see the latter so clearly while remaining in denial about the former? It calls to mind Jesus’ saying about the mote and the log–the war between East and West being the former, the war against life itself by all of us, the latter.
Authoritarianism vs. freedom. That is the civil war going on just under the surface in Zone A that Keen and Hudson while together almost acknowledge but don’t take seriously since they are so dismissive of the concept of limited government.
Maybe, just maybe, the problem is not that the state is too weak. Perhaps the opposite is true and the state has become too powerful.
That’s why ‘leftists’ in the unique American political sense have to attack core elements of the US Constitution so strongly – as tattered as it is today, as long as it remains the official document it still offers an alternative approach to both fascism and socialism.
Meanwhile, I suppose it’s always possible the RF will embrace MMT. But my hunch is they are rather more skeptical.
Seeing the comments on this post gives me such a THRILL!!
When Hudson and Keen start delving human economy in light of their massive understanding of systems dynamics and proven historical record?
It becomes a litany of triggers for all to brain-dump all their programmed talking points.
Please allow me to tell a parable that will set you all free:
At a time long ago, it was found that the habitual aversion to do more work than needed, led certain priests to cut corners.
They refused to record the century part of the calendar in all their works.
And close to the terminus of the century, it was observed that all contracts would become corrupted in records which did not note the century in which they were written.
This was a disaster!!! For contracts.
Accountants around the world got their hair on fire, because the work of defining century would force them to do physical work – and they revolted!
SOMETHING MUST BE DONE!!
This of course was the Y2K crisis.
Now, at that time, I was the manager of a very large retail systems operation. Very large.
I saw the problem and costed a remedy thusly: 4 programmers, 6 months, approx 0.25 million dollars – fixed.
No no NO!!!!
THIS IS A CRISIS!! managers all scurried around to inflate the risk.
Forget that 250 grand! We WANT 2.5 MILLION!!!
And so they set about the fear campaign to get their millions.
I got it fixed – as I said – for 250 grand and 4 guys who knew how to program.
And the managers all went and bought yachts with the rest of the budget.
It’s the same with Covid and Climate.
It’s real – but fluffed up by managerial opportunists.
Our problem is NOT our problems.
Our problem is the opportunists who make our problems intractable.
It is high time humanity gets opportunists to heal before the bastards extinct us.
The US government always seeks to solve its problems, whether real or imagined for political gain and control of the majority, using voting machines, propaganda, lies, color revolutions by the CIA, financial sanctions, military force, biowarfare, control of its judiciary, mainstream media and the money supply.
this comment has been flagged as of little/no value (possibly troll) by the saker
What a collection of fools.Garbage analysis. I began to wonder why I was bothering listening to them as soon as one mentioned race, but then when I heard one say: “We have but a small window of opportunity to respond to the climate crisis”, that was it, I realized I was wasting my time and closed the browser. Sell that trash to someone else, I’m not buying it.
Dear Obsolete Man
You are also obsolete here and not welcome anymore.
Please don’t come back.
If you do, I will ban you.