Monthly Archives: December 2011

Public Money for Public Purpose: Toward the End of Plutocracy and the Triumph of Democracy – Part IV

By Dan Kervick, a PhD in Philosophy and an active independent scholar specializing in the philosophy of David Hume who also does research in decision theory and analytic metaphysics. Cross posted from New Economics Perspectives

I have set out a simplified model of a monetarily sovereign government. But near the end of the previous section, I began to suggest that the United States government is indeed a monetary sovereign by this kind. The reader might now suspect that I have yielded my rational mind over to a simplistic fiction of my own creation. And by this point, the reader is probably thinking that however interesting it might be to imagine this fictional entity, the so-called monetary sovereign, such fictions have nothing to do with the complexities of the real world, because actual governments maintain accounts that are indeed constrained by the amount of money in those accounts and by the external sources of funding to which they have access. After all, can’t a government default on its debt? What about the recent debt ceiling debate in the US? What about what is happening in Europe with the sovereign debt crisis? Also, if a government like the United States government was a monetary sovereign of the kind I have described, the consequences would seem to be enormous. Surely if a democratic government possessed this kind of power, we would make much more use of it than we do. In short, monetary sovereignty as described seems both too simple to be real and too good to be true.

These skeptical intuitions are reasonable, so they need to be addressed.

Read more...

Public Money for Public Purpose: Toward the End of Plutocracy and the Triumph of Democracy – Part III

By Dan Kervick, a PhD in Philosophy and an active independent scholar specializing in the philosophy of David Hume who also does research in decision theory and analytic metaphysics. Cross posted from New Economics Perspectives

Now so far, I have described the operations of the monetarysovereign as though money were the only thing in the world. But this is clearly not the case. The model of themonetary sovereign I have developed is intended to be a model of agovernment. And while governments might have nearly unlimited and very easily deployed power in the creation and destruction of money, a government also participates in the exchange of real goods and services. And these goods and services are clearly finite. So there is something very special about money which is yet to be considered.

Read more...

Public Money for Public Purpose: Toward the End of Plutocracy and the Triumph of Democracy – Part II

By Dan Kervick, a PhD in Philosophy and an active independent scholar specializing in the philosophy of David Hume who also does research in decision theory and analytic metaphysics. Cross posted from New Economics Perspectives

Reflections on Modern Money

Before considering what it would mean to make our monetary system more democratic, let’s begin by calling to mind a few familiar features of money and modern monetary systems in general, features we all intuitively understand as users of money in a modern monetary economy.

Read more...

The Trouble with Principles: Or, How to Not Lose Friends and Alienate People When Learning Economics (#OccupyWallStreet, #OWS)

By Jake Romero, an economics student at Portland State University. You can reach him at jvc613 (at) gmail.com

Economics has always been something of a battleground, but in November a group of about seventy Harvard students opened a new front in the ongoing hostilities: its introductory pedagogy. In solidarity with the Occupy movement, the students staged a walkout of their principles course to protest what they called its “inherent bias.”

In his rebuttal in the New York Times, Greg Mankiw countered that his teaching is careful to avoid policy conclusions and that its subject matter falls squarely within the current mainstream of the discipline. Narrowly correct, he nonetheless profoundly missed the broader points that his students, to be fair, seemed unable to articulate fully.

Read more...

Michael Olenick: The Coming of the Light

By Michael Olenick, founder and CEO of Legalprise, and creator of FindtheFraud, a crowd sourced foreclosure document review system (still in alpha)

The people in flight from the terror behind — strange things happen to them, some bitterly cruel and some so beautiful that the faith is refired forever.

– John Steinbeck, Grapes of Wrath.

I’m Jewish: my father is a Rabbi, my mother a prominent Jewish artist, but having been raised in the US it’s impossible to miss both the holiday and the meaning of Christmas.

As Christmas lights and Chanukah menorahs light up our dark winter nights it’s impossible not to look back over the prior few years, and contemplate the difference sunlight — in the form of the Internet shining information — has made in the US and around the world.

Read more...

Morgenson on the Sham of the OCC’s Foreclosure Reviews

Given that the Office of Bank Boosterism Office of the Comptroller of the Currency is the clear first among the highly competitive ranks of bank-friendly regulators, the fact that the OCC launched a program for borrowers to obtain restitution for financial harm suffered due to foreclosures seemed more than a bit sus.

Gretchen Morgenson does an admirable job of exposing the multiple shortcomings of this OCC program.

Read more...

Public Money for Public Purpose: Toward the End of Plutocracy and the Triumph of Democracy

By Dan Kervick. Cross posted from New Economic Perspectives

A new year is upon us. And even before its first hour has been rung in, 2012 is already taking shape before us as a pivotal year in global politics. We can all feel the awakening under way. A revived longing for equality, shared prosperity and democratic solidarity is inspiring a vibrant new politics around the world. This new activist spirit is quickened by the keen apprehension of young people on every continent that something is very, very wrong with the present economic and political order. The rising generation, heirs to sick and damaged societies that have been unbalanced by decades of plutocratic rule and antisocial cupidity, have now begun to rouse themselves – and in the process they have rallied the moral outrage of their fellow citizens.

Read more...

Satyajit Das on What Went Wrong With Finance

Rob Johnson interviewed world renowned derivatives expert Satyajit Das on the evolution of modern finance. As Das recounts, he got in more or less on the ground floor as sophisticated new products and modeling techniques were introduced. Although Das is wry and understated in his criticisms, he is clearly skeptical of how the financial services industry has evolved.

Read more...