The demand for austerity is a fetish of power abuse and discharge of guilt by claiming only the best motives.
Disgusting.
The people cheering on continuously increasing government debt are cheering on impoverishing their children and their children's children to temporarily bolster their own living standards. To me that seems disgusting, robbing the future to pay for excess in the present.
Money is just a way of keeping track of how much of future output of civilization given entity deserves. If we decide that people who borrowed the money now don't deserve it then, puff, there's no debt, nothing to pay back, no burden on future taxpayers.
On the other hand the resources that we dig up now, burn, pollute... those are real theft robbing the future.
Do you mean "people who loaned that money"? That is a lot of foreign governments who will refuse to keep loaning us more money which would mean we'd need to balance our budget pretty quickly, or face inflation.
Also, please realize that it is also lots of pensioners and also anyone expecting social security in the future [1].
What you're talking about isn't even Keynesian economics, it sounds like a form of monetary nihilism. We've been down that road before, and hyper-inflation is a real thing proven by history before [2].
[1] https://www.cbpp.org/research/social-security/policy-basics-....
Yes. Thank you for the correction.
Countries have whole net of iou-s between them and debts are not always expected to be paid back in full.
Some money borrowed comes from private market that you can disregard completely if you decide it was a bad idea and don't intend to repeat it in the future.
Yes. Hyperinflation is a thing but I wonder how high (stable) inflation you could have by just printing new money and using it to finance budget directly while preventing banks from inflating money supply with credit.
I'm not sure what the solution is, but I think assuming that because there's some monetary debt now it will all have to be paid back in the future is wrong because that's not what eventually is going to happen.
In fact, it’s worse: you’re not only losing trust on the bondholders whom you reneged to repay, but also most everyone else who observed it happening. You’ll be only left with people who will require handsome compensation for observably very real risk of not getting paid back.
So yes, our children will either have to repay all the debts we took, or default and lose immense amount of food will and trust that we are exploiting by borrowing at low rates. Either way, we are enriching ourselves at the expense of our children.
It does a pretty good job at explaining why the US can basically print money at will without facing inflation. Spoiler alert: people need to buy oil in dollars, but it cost us much of our domestic manufacturing base. I bring this up because the belief seems common at present that money is imaginary and that we've made so much of it without causing inflation is proof of this fact, but (as per the article) it's like a balloon as when you squeeze it, the air has got to go somewhere.
Austerity is part of the recipe for turning a country into a failed state-see Greece.
Because we absolutely do need to print money to avoid millions of people living in the streets at this point.
But we also ARE going to be bankrupt by it.
And I think the way out is to recognize that the monetary system is dated and inadequate and create a new one. Unlikely they will do that, but I feel better mentioning it even though it will be ignored.
The new system would be digital and incorporate more real-world information and finer-grained control.
How on Earth does inflation rise all boats when it's literally a wealth transfer from all currency holders to the money issuers and first spenders (banks and financial institutions)?
Apparently we must apply these serfdom-like measures in order to win against the current pandemic, but that's a different discussion (one of effectiveness).
It's not just a discussion of effectiveness, it's a discussion of values. But proponents of the lockdowns try to avoid that by painting anyone who doesn't share their value system as evil or immoral. There's a good chunk of the population who think it would be immoral to violate people's rights to free movement and association even if a disease with a 5-10% death rate was going around, because human rights aren't conditional. E.g. people who follow some form of https://en.wikipedia.org/wiki/Deontological_ethics rather than a https://en.wikipedia.org/wiki/Utilitarianism -based value system.
Here is good intro materials to his very rational economic theories https://mises.org/economics-beginners
I love free societies and you should appreciate that capitalists allow the socialists to discuss revolution freely. Because if and when the socialists take over, I can guarantee they won’t afford the capitalists the same freedom.
You should know your enemy better than lazily repeating Cold War rhetoric. 99% of all socialists today are firmly democratic.
>Economists of the Austrian school understand, that the boom is the real problem and the economic crisis is the necessary and positive cleansing mechanism.