imc indymedia

Los Angeles Indymedia : Activist News

white themeblack themered themetheme help
About Us Contact Us Subscribe Calendar Publish RSS
Tell the NSA: StopWatching.US

Features
latest news
best of news
syndication
commentary


KILLRADIO

VozMob

CopWatch LA

ABCF LA

A-Infos Radio

Indymedia On Air

Dope-X-Resistance-LA List

LAAMN List





IMC Network: www.indymedia.org africa: ambazonia canarias estrecho / madiaq kenya nigeria south africa canada: hamilton london, ontario maritimes montreal ontario ottawa quebec thunder bay vancouver victoria windsor winnipeg east asia: burma jakarta japan korea manila qc europe: abruzzo alacant andorra antwerpen armenia athens austria barcelona belarus belgium belgrade bristol brussels bulgaria calabria croatia cyprus emilia-romagna estrecho / madiaq euskal herria galiza germany grenoble hungary ireland istanbul italy la plana liege liguria lille linksunten lombardia london madrid malta marseille nantes napoli netherlands nice northern england norway oost-vlaanderen paris/Île-de-france patras piemonte poland portugal roma romania russia saint-petersburg scotland sverige switzerland thessaloniki torun toscana toulouse ukraine united kingdom valencia latin america: argentina bolivia chiapas chile chile sur cmi brasil colombia ecuador mexico peru puerto rico qollasuyu rosario santiago tijuana uruguay valparaiso venezuela venezuela oceania: adelaide aotearoa brisbane burma darwin jakarta manila melbourne perth qc sydney south asia: india mumbai united states: arizona arkansas asheville atlanta austin baltimore big muddy binghamton boston buffalo charlottesville chicago cleveland colorado columbus dc hawaii houston hudson mohawk kansas city la madison maine miami michigan milwaukee minneapolis/st. paul new hampshire new jersey new mexico new orleans north carolina north texas nyc oklahoma philadelphia pittsburgh portland richmond rochester rogue valley saint louis san diego san francisco san francisco bay area santa barbara santa cruz, ca sarasota seattle tampa bay tennessee urbana-champaign vermont western mass worcester west asia: armenia beirut israel palestine process: fbi/legal updates mailing lists process & imc docs tech volunteer projects: print radio satellite tv video regions: oceania united states topics: biotech
printable version - json version - email this article - view hidden posts - tags and related articles
link:

View article without comments

Economists Argue over Distribution Question

by Hans Christian Mueller Tuesday, Nov. 20, 2012 at 6:29 AM
marc1seed@yahoo.com

More and more economists take distribution questions seriously. When inequality becomes too great in a national economy, the economy becomes unstable. Private indebtedness and income inequality massively increased in the US Financial markets uncoupled from real economy

ECONOMISTS ARGUE OVER DISTRIBUTION QUESTION

Income inequality destabilizes national economies; more and more economists are convinced. Many of them see the cause for the worldwide financial crisis in the growing chasm between poor and rich

By Hans Christian Mueller

[This article published 11/4/2012 is translated from the German on the Internet, http://www.handelsblatt.com/politik/international/wirtschaftswissenschaften-oekonomen-streiten-ueber-verteilungsfrage/7328592.html.]


Berlin. The class struggle has long disappeared from the vocabulary of economists. Most researchers are not interested any more in the distinctions between the particular classes of society, between poor and rich, working and wealthy, Nobel Prize winner Robert Lucas explained. Economists should not be seduced by the dangerous temptation of focusing on distribution questions, he wrote ten years ago. Whoever wants increased prosperity should worry about growth and not re-distribute.

ECONOMY MUST CREATE 600 MILLION JOBS: REPORT OF THE WORLD BANK

In the meantime, a rethinking is occurring in the economic guild. More and more economists take distribution questions seriously as shown by the November 2012 conference on the “Macro-economy Research Network” in Berlin. On invitation of the Hans Boeckler foundation, more than 300 economists discussed the future of macro-economic research. Income distribution was one of the central themes. The chasm between poor and rich has grown tremendously in the US and many other industrial countries.

ECONOMISTS UNTEACHABLE

Reforms are carried out in all departments except among economists. More and more now call for a reform of antiquated myths.

When inequality becomes too great in a national economy, the economy becomes unstable, the International Monetary Fund vice-director Michael Kumhof showed. With colleagues, he expanded a standard macro-economic model with distribution questions. In this model, there are workers and wealthy instead of homogeneous households with uniform interests.

Kumhof’s research findings reveal that income inequality in the US was one of the main reasons for the collapse in 2007. The rich who became richer and richer before the crisis had to invest their surpluses, Kumhof says – and eager customers can always be found among the poor. “The likelihood of massive crises clearly increases,” Kumhof says in the Handelsblatt interview. The liberalization of the financial markets has roused this spiral of indebtedness.

CRITICAL ROLE OF FINANCIAL MARKETS

The economist Robert Frank from Cornell University also sees the enormously increased income inequality as a cause of the credit bubble and the financial crisis. The desire of people was to not fall back compared to the richer sectors that caused the debt boom. The poorer sectors tried to stabilize their prosperity with the help of credits.

This mechanism could be an explanation for the crisis after 2007 and also for the Great Depression, the Linz economist Christian Alexander Belabed argued. “Becoming indebted lost its stigma at that time.” Many households then began buying cars on credit.

EURO IN CRISIS

Private indebtedness and income inequality massively increased in the US of the 1920s – as before 2007. This view puts in question the traditional explanation for the Great Depression. For a long while, most economists referred the worldwide economic crisis back to mistakes of central banks.

The role of the financial markets should be especially criticized. These had uncoupled nearly completely from the real economy, the US researcher Michael Hudson from the University of Missouri in Kansas City said. This economist who is regarded as one of the seminal intellectuals of the Occupy Wall Street movement makes an historical comparison: “The big landowners in the 18th and 19th century are the financial markets today.”

NEW GDP CALCULATION DEMANDED

Like the big landowners at that time, the financial sector today does not create any real assets today. The economy merely posts profits and drives workers with falling wages into heavy debts. In Berlin, many economists questioned whether it is sensible to analyze distribution questions with the traditional methodological toolbox. Instead they demanded a very new paradigm or initiatives that closely follow the theory of John Maynard Keynes.

WORLD ECONOMY

Along with Kumhof, the Berlin macro-economist Michael Burda defended the traditional approaches. Burda, the current chairperson of the Association for Social Policy, urges the unification of German-speaking economists.

On the other hand, the American economist Michael Hudson urges a very new measurement of prosperity. In the future, the true economic output realized by the real economy should be separated from the apparent output arising in the unproductive financial world. “They only produce debts, not prosperity.”

RELATED LINKS:

Mamdani, Mahmood, “Four Questions to Professor Joseph Stiglitz,” 7/25/2012
http://www.pambazuka.org/en/category/features/83875/print
http://www.buzzflash.com
http://thinkprogress.org
http://www.progressive-economics.ca

FREE INTERNET BOOKS:


"Youth and Skills: Putting Education to Work," 2012 UNESCO report, 480 pp
http://www.unesco.org/new/en/education/themes/leading-the-international-agenda/efareport/reports/2012-skills/

"Investing, not Betting," April 2012, Brussels, 67 pp
http://www.finance-watch.org

"Enough is Enough," 110 pp
http://www.steadystate.org

"Needs and Limits," Frank Rotering
http://www3.telus.net/needsandlimits/pdf_files/needs_and_limits-3rd_edition.pdf

"Free as a New Business Model," Chris Anderson

“The Economic and Financial Crisis,” Ernst Lohoff and Norbert Trenkle, 2012
http://portland.indymedia.org/en/2012/11/420072.shtml

"Culture Change," Alexis Zeigler, 126 pp
http://conev.org/ren14x.pdf

"The World Crisis and Beyond," 2009, Rosa Luxemburg foundation, 182 pp
http://rosalux-europa.info/publications/books/the_world_crisis_and_beyond/
Report this post as:
Share on: Twitter, Facebook, Google+

add your comments


"The Twinkie Manifesto"

by Paul Krugman Tuesday, Nov. 20, 2012 at 7:02 AM

Here is a link to Paul Krugman's "The Twinkie Manifesto" published November 18, 2012:

http://www.nytimes.com/2012/11/19/opinion/krugman-the-twinkie-manifesto.html?_r=0
Report this post as:
Share on: Twitter, Facebook, Google+

add your comments


Local News

LA Fields Two Marches Against Police Executions Photoset 2 of 2 A21 9:09PM

LA Fields Two Marches Against Police Executions Photoset 1of 2 A21 7:01PM

Running Down the Walls 2014 A20 8:48PM

Weaving the Past: Journey of Discovery Extends Exclusive Engagement A19 3:37PM

Los Angeles Declares “Hands Up!” in Peaceful Protest of LAPD Murder of Ezell Ford A18 4:09AM

Ezell Ford and Ferguson Solidarity A17 6:35PM

Family and Supporters of #Justice4Fords Protest LAPD Execution of Ezell Ford in South L.A. A17 2:49PM

Southern California Swarms to Save the Bees in Solidarity with Honey Bee Day Around the Gl A17 5:30AM

L.A Supports August 2nd International Gaza Protest Photoset 4 A05 7:03PM

L.A Supports August 2nd International Gaza Protest Photoset 3 A05 6:45PM

More about KPFK via Pacifica turmoils A05 6:29PM

L.A Supports August 2nd International Gaza Protest Photoset 2 A05 6:23PM

L.A Supports August 2nd International Gaza Protest Photoset 1 A05 11:36AM

Demonstration in Support of Persecuted Christians Saturday A02 10:40AM

Water in California - info proliferated now is dubious J28 5:04PM

Pacifica clearly endangered. Reposting info here: J28 2:34PM

Video: Occupy Love (2013), 1 hr 19 min J28 4:43AM

Who declares themselves to be the ultimate-only-valid-authority here on current wars elsew J27 11:11AM

MDRC's Rent Reform Assault: Section 8 tenants vs. affordable housing industry J24 12:24AM

Obama at LA Trade Tech J23 3:23PM

More Local News...

Other/Breaking News

Gaza War Postmortems A29 5:30AM

Big Lies Risk Confrontation with Russia A29 4:10AM

Philippines: Charter change and foreign ownership of land not solution to development A29 3:13AM

Infobésité ou faux évergétisme A28 11:49PM

The Shortwave Report 08/29/14 Listen Globally! A28 4:40PM

Wasecans hope trip to Ghana makes a difference A28 1:27PM

Targeting Syria A28 11:42AM

The Russians Are Coming Big Lies A28 5:11AM

Washington Sabotages Russian/Ukrainian Summit A27 1:29PM

The unconditional basic income - a social concept for Europe A27 10:49AM

Gaza Ceasefire: Hold the Cheers A27 6:04AM

Ottawa, Kansas Police Cure for Depression is 16 Bullets A27 4:08AM

Turkey is training ISIS / Islamic State A26 2:58PM

Did Obama really save the Yezidis? A26 2:38PM

Obama Declares War on Syria A26 12:43PM

What we're being told about ISIS just doesn't add up A26 12:29PM

Another No-Peace Ceasefire A26 12:23PM

Mejicanada angelina rechaza contundentemente al "Presidente" Peña Nieto A26 12:19PM

Joseph Stiglitz Calls for Fair Taxes for All A26 5:05AM

Israel v. Palestine: MSM Unreported Truths A26 4:05AM

Russia and America: Geopolitical Opposites A26 3:40AM

Anarchie ou barbarie A26 12:11AM

Steven Salaita's Academic Lynching A25 10:32AM

America’s Mind Manipulators Meet New Members A25 10:27AM

Pharma Corps Act as Mafia Dons by Suppressing Cancer Treatment Alternatives A25 7:35AM

in-human rights in the U.S. A25 6:46AM

Fascism Grips Israel A25 5:55AM

The Free Trade Trap A25 4:30AM

More Breaking News...
© 2000-2003 Los Angeles Independent Media Center. Unless otherwise stated by the author, all content is free for non-commercial reuse, reprint, and rebroadcast, on the net and elsewhere. Opinions are those of the contributors and are not necessarily endorsed by the Los Angeles Independent Media Center. Running sf-active v0.9.4 Disclaimer | Privacy