We Can't Enough Eat Soyabeans

Yes, the US economy is going into recession unless there is some miracle like a big fat m.i.c. greasy war to mobilize all the unemployed into Oreshnik or Dong Feng-17 fodder. (Only half joking.)

Today, a post that I failed (yet again) to cleanse with linguistic Persil for stuff.com friendly suitability.

What is a ‘Crash’?

But no! It is not “crashing”. The rhetoric of a “crash” implies some sort of unrecoverable disaster, like a global pandemic, or drought, or global warming. All of which might happen, but not this year. This is at least not the case with the USA this year. The US government has despicably failed to guarantee full employment, and has no clue about the reality of monetary operations. That’s what is killing their economy, scorekeeping, not some fundamental economic fragility. For heavens sake, they have a massive labour surplus they seem to not know what to do with! It’s an embarrassment of riches. Doubly embarrassing since even dirtbag MMT yours truly could think of heaps of things their people could be doing to improve the quality of life in the USA for everyone. Forget the rest of their fake-religion christofascism. They are just blithering 𝕚𝑑🄸🅾𝘵S of the highest clerical order — which is bad enough on its own!

Let there be no doubt though, the failure to run proper scorekeeping is fundamentally a complete lack of humanity, probably fully fascistic, but at least racially prejudiced, and 100% class warfare. What else can it be when the fundamental problem today is just bad scorekeeping?

The liberal-neoliberals can at least run the scorekeeping system to not cause unemployment and bankruptcies to go to records non-crisis highs. I still scratch my head at how effective TEMOTPIH has been at making a real goods economic crisis out of simply bad scorekeeping. With the Mars King booted out in fairly short order, I’d not have thought it’d go south so quickly. Automatic stabilizers and all that — always usually just enough that the suicide rate among the unemployed is “tolerable” in polite upper class dinner party circles.

You surely do not need neocon fascism at the same time, but unfortunately here you are, and it has ripple effects even down in NZ where our Tories are christo-fash emboldened too, and also wrecking our economy, thanks to your lead in the USA.

But let’s get some perspective on real crash versus fake-crash.

The fake crash is in currency, the fiscal injections “falling off a cliff” (going to zero). That’s all Deficit Myth driven stuff, the US Democrats might have acknowledged MMT, but they are too chicken-ꕷꖾꕯꖡ to admit it for fear of losing donors. They’d sacrifice low paid workers and the unemployed instead, and we should always remember the calculus, it benefits them if the economy tanks under the GOP. (“See, we’re the ‘fiscal responsible ones’ Mr Business lobby!” — they [if not full Clintonite nutcases] proceed to turn back on the fiscal injections, but never enough to eliminate unemployment.)

Why would the centrist Neoliberals eliminate unemployment? No good reason huh, since the working class are no longer their “base”. The working class have no government representation at present, not anywhere. not even from Lula in Brazil. Talk about taxation without representation! It’s at obscene levels not seen since the War of Independence.

“Why is a Kiwi writing so much about the USA?”, I hear you ask? The answer is because what the USA does has poodles like NZ neoliberals following in the fart streams.

Anyway, this post was to spit out my comments on a ridiculous Kyle Kulinski fearstream.

To be fair, he’s not wrong the GOP are screwing things up mightily, but Kulinski’s reasoning was still all backwards, as hard as it is to fathom. My thinking is if he said it all correctly, it would spell a lot worse than his pronouncements, because it is not going to be a “crash”, it will just be more long suffering seemingly without end. Never Let a Crisis Go to Waste.

The Democrats will come into power and spew, “We have to suck it up and tighten our belts thanks to Trump’s GOP, blame them!” Blame them for poor scorekeeping, but not yourselves???

But… yeah… this time it could be different (as I acknowledged in my last post). We will see. And not before too long. But even if TEMOTPIH fails to create a real crash, rather than just a financial crash, it does not ever make the pain felt by working families and the unemployed (through no fault of their own) any less horrific.

Korrekting Kulinski

Part-1. of Couple of corrections [to Kulinksi]:

(a) Your economy is not yet crushed, your farmers can still grow soybeans, your trouble is US citizens do not want to eat them all. Trade is about getting as many imports for as few exports as possible. Your exports are your real loss, not your benefit (the Chinese firms buying soybeans cannot make US$, in fact they tend to save in US Treasuries, a demand withdrawal which provides more fiscal space for US government spending). The problem is, your government is not filling that currency vacuum, the evidence is unemployment. Read The Deficit Myth — no, I mean actually read it this time!

(b) Your export farm lobby is really an enemy of the USA, their interest is in the foreign buyer, and lower domestic wages. A farm policy should instead be 90% domestic, feed your own people first. Not just with soybeans, grow some other crops. Whatever excess you produce there is always a foreign buyer, at some price, e.g., farm starved nations. Give them a discount, it’s the humane thing to do in trade (which is more often “the opposite of religion, better to receive than to give.”)

Part-2. foreign trade is not your problem fundamentally, you trade to get nice imports, not to export (which fuels your export oligarchs, the enemies of the nation, their interest is in suppressing domestic wages). Your problem is drying up of fiscal injections (aka. the “governemtn deficit”). That’s what is killing you. Not the excess soybeans (grow other crops for domestic sale).

The Gov Deficit is dollar-for-dollar the non-government sector surplus. You want that higher, not lower. If your population grows you want the accumulated debt therefrom to grow with population size, not shrink, just to support existing prices, even before inflation from interest rate hikes (the interest rate is the base inflation rate, through term structure of prices faced by consumers and contracts today.)

((While old hat MMT, this stuff cannot be repeated often enough!))

The “government debt” is the net money supply, i.e., non-government sector tax credits, by accounting identity, with a growing population is should naturally rise over time, indefinitely. It always can, it’s just scorekeeping (no gold is at stake, no grandkids held to ransom).

More Stuff that Cannot Be Repeated Enough

Part-3. The “rush into gold” is not into gold, it is into gold securities (pieces of paper). No one seriously ships or receives any gold metal${}^\dagger$, if they all tried together there’d be blood at Fort Knox.

${}^\dagger$ except a few with metallic yellow colour fetishes. The gold prices always reverts to the mean, and that is a price dictated by government policy, it cannot be otherwise, since the numeraire is still the “$”, and the monopoly issuer of “$” sets the exchange value of the "" scorepoint, whether they know it or not. (They do not know it.)

While Kulinski is guilty of fearstreaming, I think my take on things is even more terrifying. Kulinski’s problem is his solutions (tax the corporations, tax, tax, tax, export, export, export…) are nuts, backwards, and obscenely regressive. Anti-worker. And yet he has no clue about it! He’s not trying to be regressive, quit ethe opposite. Hence why I have more justification to shake with fear than he does. Peter Thiel will be in New Zealand permanent before too long 𖡮𖦙ꚶ𖥐𖢉𖥣ꛘꛪ us up instead of you guys.

Luckily Kulinski fearstreaming was shortish, so that’s all I have in response for now. But he and Krystal Ball are forever shooting the working class in the head with their social influencer, “me tax dollar paid for it” nonsense. God (the actual unkowable entity) help us all! Along with Richard Wolff, they’re enabling the fasicists and libertarians at the same time! Quite some feat for people who like to think of themselves as anti-fascist!