## Thursday, February 28, 2013

### hi fi squeeze out ...discovering hidden inefficient corporate rent sumps

recall this can be seen
as
a use of the greenwald stiglitz model

applied here in practice by the hi fi ers
to extract reproductively  un neccesary rents in the social market mediated  production platform

a rudolf meidner tax ?

the failure to implement this beuatiful tax
pretty well ended the swedish dash toward eden
at least by way of tax and transfer systems

under the paine soviet system
the commanding heights would operate with similar isle of Laputo savagery
toward the underlying production archipeligo

difference ?

the extractions would get tossed in the general social surplus melder

"Roughly half of outstanding debt owed to the public, now $11.7 trillion, is owned by foreigners" ". This part of the debt is a direct burden on ourselves and future generations. " "Foreigners are entitled to receive interest and principal and can use those dollars to acquire goods and services produced here. If our government had used borrowed money to improve infrastructure or to improve the skills of workers, the resulting extra production would have made repayment easier. Instead, over the last decade, it used the money for wars and tax cuts. " "The Treasury owes dollars, America’s own currency" " So the Treasury can always make payments when due ... no foreign lenders realistically expect us to default. If they did, they would be insisting on higher interest rates, which they aren’t." . "One way to effectively repudiate our debt is to encourage inflation. " "When prices rise, interest and principal are repaid in dollars that are worth less than they were when they were borrowed. " . "Treasury bonds owned by Americans are different from debt owed to foreigners." " Debt owed to American households, businesses and banks is not a direct burden on the future." " Some of our grandchildren would be paying off others of our grandchildren;" "The real burden of domestically owned Treasury debt is that it soaks up savings that might go into useful private investment." " Savers own Treasury bonds because they are seen as safe, default-free assets, and the government can borrow at lower rates than corporations can. If there were less debt, and fewer bonds for sale, savers seeking higher returns would invest in corporate bonds or stocks instead. Business investment would expand and be more profitable. " "But in bad times like now, Treasury bonds are not squeezing finance for investment out of the market" ". On the contrary, debt-financed government spending adds to the demand for privately produced goods and services, and the bonds provide a home for the excess savings. When employment returns to normal, we can return to debt reduction. " "In the long run we need a clear plan to reduce the ratio of publicly held debt to national income. " ahh dear old bob like most neo classical synthetics he adds nothing even as he clearly states everything i would offend him by compressing this to: "please ...just borrow all you want today today today but bob what of tomorrow and tomorrow and tomorrow ? feel free my people to inflate as much as you please away away away away ### two post WWII "flation" motions ## Wednesday, February 27, 2013 ### dirty deed numero uno : winter 1951 THE ACCORD !!! http://www.richmondfed.org/publications/research/economic_quarterly/2001/winter/pdf/hetzel.pdf "In April 1942, after the entry of the United States into World War II, the Fed publicly committed itself to maintaining an interest rate of 3/8 percent on Treasury bills. In practice, it also established an upper limit to the term structure of interest rates on government debt. The ceiling for long-term government bonds was 2 1/2 percent...... since its meeting on June 13, 1950, the FOMC had chafed at the straitjacket imposed by the rigid regime of rate pegging......." truman "[T]he Federal Reserve Board should make it perfectly plain. . . to the New York Bankers that the peg is stabilized.. . . I hope the Board will. . . not allow the bottom to drop from under our securities. If that happens that is exactly what Mr. Stalin wants. (FOMC Minutes, 1/31/51, p. 9)" "The prospect of a prolonged war created the likelihood of government deficits and the issuance of newgovernment debt. Additional debtwould force down the price of debt unless the Fed monetized it. That is, to prevent yields from rising above the 2 1/2 percent rate peg, the Fed would have to buy debt and increase bank reserves. Banks would then fuel an inflationary expansion through increases in credit and the money supply" 2. The threat of a major, protracted war created the real possibility that the bond rate would rise to its 2 1/2 percent ceiling. Life insurance companies, which held the bonds, then had an incentive to sell them immediately to avoid a capital loss as bond prices declined. 12 The Fed did not want to monetize an avalanche of bond sales. For that reason, it wanted to eliminate the above-par price on the bonds. The Treasury, in contrast, saw the problem as one of the Fed’s own creation. If the Fed would only publicly commit to maintaining indefinitely the current price of bonds, it believed, bond holders would no longer have an incentive to sell. New York Times : “[L]ast Thursday constituted the first occasion in history on which the head of the Exchequer of a great nation had either the effrontery or the ineptitude, or both, to deliver a public address in which he has so far usurped the function of the central bank as to tell the country what kind of monetary policy it was going to be subjected to.” Truman had compelling reasons to freeze interest rates. On January 25, 1951, he froze wages and prices, apart from farm prices. Raising the cost of borrowing, especially on home mortgages, while freezingwageswas poison. 14 More important, in January 1951 Truman confronted the possibility of world war. Treasury communication with the Fed referred to a possible Soviet attack on the United States “within the foreseeable future” (FOMC Minutes, 3/1/51, p. 119). Truman and Snyder wanted to keep down the cost of financing the deficits that would emerge from a wider war Truman and the leadership in Congress believed that deficit financing had caused the World War II inflation (Goodwin and Herren 1975, p. 70; Donovan 1982, p. 325). At the urging of the Administration, Congress raised taxes sharply in September 1950 with the Revenue Act of 1950 and again in January 1951 with an excess profits tax (Goodwin and Herren 1976, p. 71). However, if the war widened to include China and possibly the Soviet Union, there would be government deficits eccles january 51 "As long as the Federal Reserve is required to buy government securities at the will of the market for the purpose of defending a fixed pattern of interest rates established by the Treasury, it must stand ready to create new bank reserves in unlimited amount. This policy makes the entire banking system, through the action of the Federal Reserve System, an engine of inflation. (U.S. Congress 1951, p. 158)" -------------------------------------------------------------- exchange congressman patman / eccles Patman: Don’t you think there is some obligation of the Federal Reserve System to protect the public against excessive interest rates? Eccles: I think there is a greater obligation to the American public to protect them against the deterioration of the dollar. Patman: Who is master, the Federal Reserve or the Treasury? You know, the Treasury came here first. Eccles: How do you reconcile the Treasury’s position of saying they want the interest rate low, with the Federal Reserve standing ready to peg the market, and at the same time expect to stop inflation? Patman: Will the Federal Reserve System support the Secretary of the Treasury in that effort [to retain the 2 1/2 percent rate] or will it refuse?. . .You are sabotaging the Treasury. I think it ought to be stopped. Eccles: [E]ither the Federal Reserve should be recognized as having some independent status, or it should be considered as simply an agency or a bureau of the Treasury. (U.S. Congress 1951 ------------------------------------- more eccles "We are making] it possible for the public to convert Government securities into money to expand the money supply.. . .We are almost solely responsible for this inflation. It is not deficit financing that is responsible because there has been surplus in the Treasury right along; the whole question of having rationing and price controls is due to the fact that we have this monetary inflation, and this committee is the only agency in existence that can curb and stop the growth of money.. . . [W]e should tell the Treasury, the President, and the Congress these facts, and do something about it.. . .We have not only the power but the responsibility.. . . If Congress does not like what we are doing, then they can change the rules" --------------------------- ny fed president and major mephisto sproul "[T]he Committee did not in its operations drive securities to any price or yield.. . . [M]arket forces had been the determining factor, and that only in resisting the creation of reserves had the committee been a party to an increase in interest rates. That. . . was the result of market forces, and not the action of the Committee. " "the FOMC’s letter to Senator O’Mahoney. The initial substantive paragraph began with the famous quote from John Maynard Keynes: “[T]hat the best way to destroy the Capitalist System was to debauch the currency” (FOMC Minutes, 2/14/51, p. 87). The letter expressed hope for an agreement with the Treasury, but ended by saying that if such agreement were not possible “[W]e will have no defensible alternative but to do what, in our considered judgment, is for the best interests of the country, in accordance with our statutory responsibilities” (FOMC Minutes, 2/14/51, p. 89)." The Fed then forced resolution of the dispute. It informed theTreasury that as of February 19, it “was no longer willing to maintain the existing situation in the Government security market” (U.S. Treasury 1951, p. 266). Sproul (1952, p. 522) recounted that the Fed informed the Treasury that “unless there was someone at the Treasury who could work out a prompt and definitive agreement with us. . . we would have to take unilateral action.” At the time, the Treasury faced a sizable need to refund existing debt. For the first time, it also faced the prospect of issuing new debt. To quiet uncertainty in the markets, the Treasury believed it had no choice but to end the public dispute On the morning of February 26, McCabe and Sproul attended a meeting in the White House with the President and other government policymakers. (Snyder remained in the hospital.) Truman read a memorandum stating that “Changing the interest rate is only one of several methods to be considered for curbing credit expansion.” He then asked the Fed chairman and other policymakers “to study ways and means to provide the necessary restraint on private credit expansion and at the same time to make it possible to maintain stability in the market for government securities” (FOMC Minutes, 2/26/51, p. 102). As an alternative to a rise in interest rates, Truman asked for selective credit controls (“direct Government controls”) to limit credit extension (FOMC Minutes, 2/26/51, p. 102). When Chairman McCabe “commented on the situation created by the continued purchase by the System of. . . bonds,” Treasury Under Secretary Foley countered “that the proposed action by the Federal Open Market Committee might cause a crisis which should be avoided.” While the meeting was underway, the White House released the contents of the President’s memorandum to the press. The Treasury maintained the position that direct controls on credit were preferable to increases in interest rates (FOMC Minutes, 3/1/51, p. 117). However, the Treasury also believed that an end to the dispute with the Fed would restore market confidence and allow it to continue to sell bonds at 2 1/2 percent (FOMC Minutes, 3/3/51, p. 153). Moreover, as became apparent later, the Treasury still had another weapon to use. When Snyder went into the hospital, he left negotiations with the Fed in the hands of the Assistant Secretary of the Treasury, William McChesney Martin. 22 Martin notified the Fed that he desired negotiations based on the FOMC’s February 7 letter. He reestablished staff contact between theTreasury and the Fed, which Snyder, as Leach recalls, had forbidden some years earlier. William McChesney Martin and Fed staff members Robert Rouse, Woodlief Thomas, and especially Winfield Riefler, negotiated an agreement between the Treasury and the Fed (FOMC Minutes, 2/26/51, p. 93; FOMC Minutes, 3/1/51, pp. 112–13). As presented to the FOMC on March 1, the resulting agreement reflected Riefler’s original ideas. The Fed would keep the discount rate at 1 3/4 percent through the end of 1951. The Treasury would remove marketable bonds from the market by exchanging them for a nonmarketable bond yielding 2 3/4 22 Martin had exceptional qualifications. In 1938, at age 31, he became president of the New York Stock Exchange. Newspapers called him the “boy wonder of Wall Street.” After the Army drafted him in World War II, he helped run the Russian lend-lease program. In 1946, he became head of the Export-Import Bank. In December 1948, Treasury Secretary Snyder, a fellow Missourian, convinced Martin to join the Treasury. Finally, Martin’s father had been Governor of the Federal Reserve Bank of Saint Louis. R. L. Hetzel and R. F. Leach: New Narrative Account 51 percent. 23 To make those bonds liquid and thus more attractive to the market, the Treasurywould exchange them upon request for a 1 1/2 percent marketable five-year note. During the exchange, the Fed would support the price of the five-year notes. That support was central because the value of the nonmarketable bonds depended upon the price of the five-year note. However, the Fed made no commitment to support the note’s price beyond purchases of$200 million.

On March 1, Martin presented the compromise to the FOMC. The minutes

make clear that he displayed the charm for which he is legendary. He began by

saying, “Iwant to say for the Treasury people we could not have had pleasanter

or more frank or more open discussions” (FOMC Minutes, 3/1/51, p. 118).

The main sticking point for theFOMCwas whether theTreasury had accepted,

during the bond exchange, a limitation both on the duration and dollar amount

of its intervention in support of the five-year note (FOMC Minutes, 3/1/51,

p. 136). Also, theFOMCwanted to make sure that its commitment to maintain

“orderly markets” did not imply a rate peg.

The FOMC met again on March 3, 1951. Chairman McCabe said that

Mr. Murphy, Special Counsel to the President, had inquired on behalf of

President Truman whether long-term bonds would drop below par. McCabe

had replied to Murphy that he could not say. During the meeting, Riefler

received a telephone call from Martin informing him that Secretary Snyder,

who was still in the hospital, had accepted limitations on Fed support during

the exchange of the marketable for the nonmarketable bonds. However, Martin

requested that there be no written record of that point (FOMC Minutes, 3/3/51,

p. 158).

The FOMC then voted to ratify the Accord and to issue the following

statement the next day: “The Treasury and the Federal Reserve System have

reached full accord with respect to debt-management and monetary policies

to be pursued in furthering their common purpose to assure the successful

financing of the Government’s requirements and, at the same time, to minimize

monetization of the public debt” (FOMC Minutes, 3/3/51, pp. 156, 163).
The FOMC then voted to ratify the Accord and to issue the following
statement the next day: “The Treasury and the Federal Reserve System have
reached full accord with respect to debt-management and monetary policies
to be pursued in furthering their common purpose to assure the successful
financing of the Government’s requirements and, at the same time, to minimize
monetization of the public debt” (FOMC Minutes, 3/3/51, pp. 156, 163).

24 While in
the hospital, Snyder conveyed to Truman the message that he felt he could no
longer work with McCabe. Without a working relationship with the Treasury,
McCabe could not function as Chairman of the Board of Governors. McCabe
sent in a bitter letter of resignation, but resubmitted a bland version when asked
to do so by the White House. McCabe, however, conditioned his resignation
on the requirement that his successor be acceptable to the Fed. On March 15,
23

About $40 billion in 2 1/2 percent bonds were outstanding (U.S. Treasury, 1950 Annual Report, Table 17). 24 Donovan (1982, p. 328) wrote, “Truman forced McCabe out as chairman of the Board of Governors.” This paragraph summarizes Donovan (1982, p. 331). 52 Federal Reserve Bank of Richmond Economic Quarterly the President appointedWilliam McChesney Martin to replace McCabe. The Senate confirmed Martin on March 21. McCabe left office on March 31, and Martin took office April 2. Leach recalls that the initial reaction both among Board staff and onWall Street to Martin’s appointment was that the Fed had won the battle but lost the war. That is, the Fed had broken free from the Treasury, but then the Treasury had recaptured it by installing its own man. However, as FOMC Chairman, Martin supported Fed independence. Some years later, Martin happened to encounter Harry Truman on a street in NewYork City. Truman stared at him, said one word, “traitor,” and then continued. 25 Leon Keyserling (1971, p. 11), chairman of the Council of Economic Advisers from 1950 through 1952, said later: “[Truman] was as strong as any President had ever been in recognizing the evils of tight money.. . . He sent Martin over to the Treasury to replace McCabe. Martin promptly double-crossed him.” In his speech accepting an appointment to the Board of Governors, Martin (1951, p. 377) said: Unless inflation is controlled, it could prove to be an even more serious threat to the vitality of our country than the more spectacular aggressions of enemies outside our borders. I pledge myself to support all reasonable measures to preserve the purchasing power of the dollar. The Treasury’s offering of the new 2 3/4 percent nonmarketable notes in exchange for the 2 1/2 percent marketable issues took place from March 26 through April 6. During this period, as provided for in the Accord, the Fed purchased the five-year notes as needed to support their price. However, the Fed spent the entire amount agreed to in the first three days. “[D]ismayed Treasury officials asked for continued support. The request was refused, and there was nothing more the Treasury could do about the matter” (Hyman 1976, p. 351). The Fed just said “No.” Thereafter, the Fed bought only small amounts of the bonds to prevent “disorderly conditions in the market.” Their price went from around 100 3/4 before the Accord to around 97 in the last half of the year “when the bond market was on its own” (Board 1951 Annual Report, p. 5). Under its new leadership, the FOMC had issued its ultimate challenge to the White House. Why did Truman finally walk away from the conflict? For Truman to triumph over the Fed, he would have had to prevail in Congress; however, his precarious political position in early April 1951 made that impossible. Truman’s political popularity had plummeted in part because of scandal. Earlier that year, Senator Fulbright (D. Arkansas) had released a report 25 Telephone interview, Robert Mayo, April 10, 1998. R. L. Hetzel and R. F. Leach: New Narrative Account 53 accusing two directors of the Reconstruction Finance Corporation (RFC), one a politically well-connected Democrat, of favoritism (Donovan 1982, p. 333). More important, shortly after the conclusion of the Accord, a much more serious and long-simmering crisis boiled over: the tension between President Truman and General Douglas MacArthur. MacArthur had opposed Truman’s policy of limited war, saying that it amounted to “surrender.” Truman had made the decision to seek peace in Korea through its partition at the 38th parallel rather than to engage China in a wider war, which he feared would involve the Soviet Union and atomic weapons. On February 13, MacArthur called Truman’s policy “unrealistic and illusory.” 26 On March 24, MacArthur claimed that he could defeat China if only Washington would stop restricting him militarily. He even offered “to confer in the field with the commander-in-chief of the enemy forces.” His statements sabotaged secret negotiations to settle the war. Representative Joseph (Joe) Martin (R. Mass.) advocated the use of Chiang Kai-shek’s forces in Formosa to open a second front against China. MacArthur supported Martin in a letter, which included the phrase “There is no substitute for victory” (Donovan 1982, p. 352). On April 5, Martin read MacArthur’s letter in the House of Representatives. On April 10, four days after the end of the bond exchange, Truman fired MacArthur. Truman biographer Robert Donovan (1982, p. 358) wrote that Truman “knew well enough that he would awake in a political climate raised to a pitch of hatred and recrimination so severe that it could not fail to stain the remainder of his term in office. Of all the storms he lived through as President, the one about to break was the worst.” To aggravate Truman’s problems, MacArthur learned from the radio that Truman had fired him. The Chicago Tribune wrote in a front page editorial: “Truman must be impeached and convicted.. . . [H]e is unfit, morally and mentally, for his high office” (Donovan 1982, p. 359). Subsequent events gave the Fed time to incubate its fragile independence. Inflation abated sharply. CPI inflation averaged just over 3 percent from 1951Q2 through 1951Q4 and just less than 1.5 percent in 1952. Also, Dwight D. Eisenhower, Truman’s successor and President from 1953 through 1960, and his Treasury secretaries shared the Fed’s goal of price stability (Saulnier 1991). 3. CONCLUDING COMMENT The March 1951 Accord marked the start of the modern Federal Reserve System. Under Chairman Martin, the Fed’s overriding goals became price stability and macroeconomic stability. 26 This paragraph and the next are from Donovan (1982, pp. 349–51). 54 The Administration had one more hope that it would prevail. 24 While in the hospital, Snyder conveyed to Truman the message that he felt he could no longer work with McCabe. Without a working relationship with the Treasury, McCabe could not function as Chairman of the Board of Governors. McCabe sent in a bitter letter of resignation, but resubmitted a bland version when asked to do so by the White House. McCabe, however, conditioned his resignation on the requirement that his successor be acceptable to the Fed. On March 15, Sproul About$40 billion in 2 1/2 percent bonds were outstanding (U.S. Treasury, 1950 Annual

eccles

martin

"Unless inflation is controlled, it could prove to be an even more serious

threat to the vitality of our country than the more spectacular aggressions

of enemies outside our borders. I pledge myself to support all reasonable

measures to preserve the purchasing power of the dollar."

---------------------------------------------------------------------------------------------------------------------

"Some years later, Martin happened to

encounter Harry Truman on a street in NewYork City. Truman stared at him,

said one word, “traitor,” and then continued.

25 Leon Keyserling (1971, p. 11),

chairman of the Council of Economic Advisers from 1950 through 1952, said

later: “[Truman] was as strong as any President had ever been in recognizing

the evils of tight money.. . . He sent Martin over to the Treasury to replace

McCabe. Martin promptly double-crossed him.”

### Fed Debt service burden ...if the FED plays patty cake

"Interest alone could rise  from a current  $224 billion to a possible$857 billion 10 years from now"

but why ?

we need
a bout of financial repression
when  this snail paced recovery from the job  slump ends

## Saturday, February 23, 2013

### why models grind out good news: we'll get back on track

of course there's the jiggering with the trend line :

## Friday, February 22, 2013

### we need to make greenwald stiglitz etc into a concrete wonder land

these unstable markets  in particular
and inadequate dynamic demand to sustain innovations

shirker markets

reputation rents

rationed credit

list goes on

### agents and synthetic modeling fine but....analytic models are abductive too

fine

play at this open  mind crap
oppose it to practice

a passive mode of  discovery

so long as our rudely empirical types
respect their tools of extraction
act upon the data
and
impact decisively the "findings "
they  wrench out of the telemetry of any real markets

### negative rates or inflation?

adjusting the real value of fixed  nominal obligations requires
use of inflation
of  product prices and of course wage rates

negative or positive changes in  rates of interest
not limited by the zero line
call them in general  occasional real value realigners

in any closed market system
inflation is meaningless unless its non proportional

ie
some nominal values move  differently then others
more or less
including
in  opposite directions

open systems are inter linked by forex rates
where congruent or just  similar  or  for that matter

## Thursday, February 21, 2013

### Linearization and commercial arithmetic

The scale here is critical After all short enough linear intervals in all relevant dimensions Oughta capture the decisions of agents using arithmetic to calculate their actions And reactions
$x_n$ :
$x_{n+1}=f_\mu(x_n)=\begin{cases} \mu x_n & \mathrm{for}~~ x_n < \frac{1}{2} \\ \\ \mu (1-x_n) & \mathrm{for}~~ \frac{1}{2} \le x_n \end{cases}$

## Tuesday, February 19, 2013

### Work sharing in the GD

NBER Working Paper No. 18816 Issued in February 2013 NBER Program(s):   DAE During the Great Depression of 1930s, changes in the workweek drove a larger portion of changes in total labor input than in other decades. Work-sharing policies appear to be responsible. Hoover created various work-sharing committees lead by key industrialists, which pushed for shorter workweeks and Roosevelt’s President’s Reemployment Agreement called for sharp cuts in weekly hours. The hope was to spread available work amongst more people. While between 50 and 90 percent of declines in labor input were accommodated by falling hours during these periods, in recent decades employers have primarily relied on layoffs to achieve the same end. During the Great Depression of 1930s, changes in the workweek drove a larger portion of changes in total labor input than in other decades. Work-sharing policies appear to be responsible. Hoover created various work-sharing committees lead by key industrialists, which pushed for shorter workweeks and Roosevelt’s President’s Reemployment Agreement called for sharp cuts in weekly hours. The hope was to spread available work amongst more people. While between 50 and 90 percent of declines in labor input were accommodated by falling hours during these periods, in recent decades employers have primarily relied on layoffs to achieve the same end.

### Class assignment : evaluate Paul k's blog

How much did he get right as a Merlin How much did he teach as a mentor All evaluation is relative And requires a numeraire I'd Use brad Delong as numeraire Why I'm I assigning this to u not to moi ! Slow reader lazy compiler Better you absolute comp advant me Use my quick negative thinking and flawless pattern recognition to review your findings I give you till march first

### Over looking cost cutting investments in a time of stagnating real demand

Why not look at the return to investing in cost reducing processes ? If your loaded up with cash Hence the fairly reasonable corporate spending on new software and equipment Green field investing of course is utterly absurd and kaputniki

### To be the forward guidance equivalent of an All seeing fed ? All power sufficient

What would the fed need to be to be a reliable forward guide? That is the assignment for all institutionally constrained progressive job class oriented macro reformers

### Uncle provided and required Lot insurance

Why not ? The premium would be a george tax

### Dropping the AS IF

Think of the. " by an invisible hand " or as if money ...whatever that might be framed into Has something well captured by the word velocity for that matter any of GT Keynes aggregates like Y I C N Trying to drop the " as if " and plowing into making policy can take you right down the rabbit hole On the other hand retaining the "AS IF" brackets Suggests you set up some pretty sharp real time info feed back systems Of course in the public square chatter dropping the as it's can be like playing catch with a Bowie knife

## Monday, February 18, 2013

### brad clips GT keynes and bashes the Moor

"I agree with [Silvio] Gesell that the result of [our] filling in the gaps in the classical theory [with our approaches] is not to dispose of the [free-market] ‘Manchester System’,"

" but to indicate the nature of the environment which the free play of economic forces requires if it is to realise the full potentialities of production. The central controls necessary to ensure full employment will, of course, involve a large extension of the traditional functions of government…. "

"But there will still remain a wide field for the exercise of private initiative and responsibility. Within this field the traditional advantages of individualism will still hold good."

"Let us stop for a moment to remind ourselves what these advantages are."

" They are partly advantages of efficiency
— the advantages of decentralisation and of the play of self-interest."

" The advantage to efficiency of the decentralisation of decisions and of individual responsibility is even greater, perhaps, than the nineteenth century supposed; and the reaction against the appeal to self-interest may have gone too far. "

"But, above all,"

here it comes sports fans

"  if it can be purged of its defects and its abuses,"

the good old angelization assumption

" individualism  is the best safeguard of personal liberty in the sense that, compared with any other system, it greatly widens the field for the exercise of personal choice"

"It is also the best safeguard of the variety of life, which emerges precisely from this extended field of personal choice,"

the loss of  personal choice  is the greatest of all the losses of the homogeneous or totalitarian state."

" For this variety preserves the traditions which embody the most secure and successful choices of former generations; it colours the present with the diversification of its fancy; and, being the handmaid of experiment as well as of tradition and of fancy, it is the most powerful instrument to better the future…."

personal choice "the hand maiden of experiment "!!!!!

-------------------

back to reality

"[I]f… demand is deficient, not only is the public scandal of wasted resources intolerable, but the individual enterpriser who seeks to bring these resources into action is operating with the odds loaded against him. "

"The game of hazard which he plays is furnished with many zeros, so that the players as a whole will lose if they have the energy and hope to deal all the cards."

" Hitherto the increment of the world’s wealth has fallen short of the aggregate of positive individual savings; and the difference has been made up by the losses of those whose courage and initiative have not been supplemented by exceptional skill or unusual good fortune."

" But if effective demand is adequate, average skill and average good fortune will be enough."
--------------------------------

back to liberal dog  barking

"The authoritarian state systems ...solve the problem of unemployment at the expense of efficiency and of freedom. "

-----------------------------

punch drunk sum up:
\
"It is certain"

" the world will not much longer tolerate the unemployment…."

" But it may be possible by a right analysis of the problem to cure the disease whilst preserving efficiency and freedom…"

the ghost of  future '78
rises to laff