Found on the Net:
In 2011, the Nobel laureate economist Paul Krugman characterized conservative discourse on budget deficits in terms of “bond vigilantes” and the “confidence fairy.” Unless governments cut their deficits, the bond vigilantes will put the screws to them by forcing up interest rates. But if they do cut, the confidence fairy will reward them by stimulating private spending more than the cuts depress it.
In other words, like all conservative economics, it’s nonsense. Or superstition. Or magic. Or they know it’s a big fat lie and they won’t admit it. Probably the latter.
Not to mention that there are no true conservatives anywhere on Earth who even believe in anti-deficit theory in the first place. All modern conservatives, given the chance in office, will balloon deficits wildly. In the US, this is due to another scam. Conservatives deliberately blow up deficits to cause an artificial debt crisis. Then the lying dogs start screaming about the deficits that they themselves created (without acknowledging that they created them) and demanding the destruction of most if not all social spending to fight the deficit crisis. The fact that they got away from this scam for decades is outrageous.
The corporate media of course is in on the whole scam and never blew the whistle on them even once. Americans, who are profoundly idiotic in terms of political economics, finally started to catch onto this scam under Trump a full 40 years after it was implemented under silver-tongued Scammer-in-Chief Ronald Reagan. In terms of political economics, Americans are some of the dumbest people on Earth. All over the world, people vote their class interests. Only in the US and a few other places such as Hong Kong and Colombia do they not do so. Americans are the ultimate class cucks.
Venezuealans and Nicaraguans, dumb spics in most Americans’ minds, have a far greater sense of political economics and class consciousness. No way on Earth could you put a scam like this over them. They won’t fall for it. It’s rather pathetic when dumb spics are vastly more intelligent on political economics than Americans are.
I guess Brazilians and Colombians are dumb enough to fall for it. But Peruvians, Paraguayans, Argentines, and increasingly Chileans ain’t falling for this crap anymore. Neither are Hondurans. Or apparently Mexicans. Salvadorans supposedly have great class consciousness but they just voted in a rightwinger named Bukele. Guatemalans are permanently class cucked and confused, possibly terrorized into supporting rightwing economics, though most of them don’t seem to have a clue about politics or economics. Ecuadorians are apparently easily fooled.
Outside the Western Hemisphere, no one falls for this crap except in the UK for whatever weird reasons they have. The Baltics became extremely class cucked as a reaction against Communism and it was deadly for them. Indians seem pretty class cucked. At any rate, if they have any money at all, they go hard rightwing on economics. You can’t put this scam over anywhere in the Arab World. They won’t stand for it. The Arab World is run by populists. Nor could you in Turkey.
For that matter, in most of the former USSR, it’s not possible to class-scam people. 70 years of the USSR guaranteed that class consciousness is pounded into the sense of all workers. This is what rightwing idiots don’t get about the fall of the USSR. They didn’t end up with this neoliberal paradise full of class cucks that they wanted. Instead, they ended up with a permanently militant working class and a permanently socialist or social democratic state. You can change the form (the state) but you can’t change the contents (what’s in people’s minds).
15 thoughts on “Alt Left: Conservative Arguments against Deficits”
The Republican view of budget deficits: deficits cause by social spending are bad, bad; deficits caused by tax cuts for the rich are good, good.
There is a macroeconomic reason for considering some deficits too high. Suppose that we have an economy that is running at full capacity with a GDP of 500 billion. Imports and exports are both 100 billion, savings and investments are both 100 billion. Government expenditure is 120 billion, but taxes are only 80 billion. There is now an excess demand of 40 billion, which will be inflationary because an economy that at full capacity can produce a GDP of 500 billion cannot produce 540 billion. There will be inflation.
We should always look at the sectoral balances: (exports – imports) + (government expenditure – taxes) + (investments – savings) = 0. (X – M) + (G – T) + (I – S) = 0. To formulate it differently, X + G + I = M + T + S. If the private sector (households and businesses) is a net saver, then either the country has to run a trade surplus or the government has to run a deficit.
Whether or not a government should run a budget deficit or not, depends on the macro-economic context. In many developed countries, the business sector no longer runs a deficit, which means that they cannot absorb the savings of households. In such a case there are 2 options: let the government absorb the savings, that is, run a budget deficit, or else let foreigners run a deficit, which means that we have a trade surplus.
Always look at the sectoral balances when discussing deficits. Always remember that for every deficit there has to be a surplus somewhere else. This flows from the fact that revenues and expenditures for the world as a whole are always the same.
Gotta disagree a bit with Colombia. It seems that at least now they are finally waking up. The polls showed Gustavo Petro with a considerable lead above the other candidates. Uribe knows that the people don’t like either Duque nor the system, so he did the classic trick of putting a “moderate” rightist that is relatively unknown to the mainstream politics. It doesn’t seem to be working, as Petro still has a lead in the polls.
What happened to Brazil the last time was the same thing was the same as Ecuador and many other places. They jail or prevent going for election the most popular leftist candidate, so people either abstain or vote to the right.
Ok, so the Colombians are finally waking up then. How good is Petro? Some on the Left think he’s too moderate. Didn’t the people realize that they need the guerrilla to protect them when the state unleashed its mass terror against the demonstrations, murdering and disappearing hundreds of people? I know the guerrilla tried to stay out of the fight and defending the protestors for fear of the protestors being tagged as part of the guerrilla. You gotta wonder what is wrong with Colombia though. A majority voted against the peace process because it would reward the “evil guerrilla.”
I suppose this “moderate rightist” is nothing of the sort.
Ah, ok, so the Brazilians were tricked, got it.
I was a teenager when the peace process happened. I didn’t know anything then about geopolitics and stuff at all, yet i knew they where making a huge mistake by disarming themselves. Having a popular president that was going to win ending up being murdered is the reason they took arms in first place.
About Petro being too moderate, one has to take into account the regional context to see what he can get away with and what he cannot. Even in the worst case scenario, not sending paramilitaries to the region and genociding his own population would be a huge improvement by Colombian standards.
Even Pedro Castillo dug himself a hole in some of his speeches. The Left of the region weren’t even sure if he would end up turning himself.
What Alvaro Uribe did is a pretty common technique that Latin American oligarchies utilize. Usually the population eventually gets fed up with the consequences of neoliberal policies, and this not only results in protests, but the people also associate all of the pain caused by neoliberalism with the current president and the system. The latter to a much lesser degree; but it depends, sometimes the people gain a lot more class consciousness than the oligarchies expect.
What the oligarchies do in response is “sacrifice” the current president by offering another candidate that is unknown to national politics and separate from the mainstream. The selected politics occasionally include a center-left sell out, but mainly consist of a “center-right” candidate. Sometimes they actually do the opposite and chose a far-right fascist populist, which sadly seems to work as well. I don’t remember which type the current candidate was, but he is an Alvaro Uribe puppet, much like all the previous presidents after Alvaro, including Duque.
Mario Silva actually said in La Hojilla that Petro better watch himself.
Freddy Bernal told in an interview that an election of Gustavo Petro would allow to the establishment of good relations between the countries.
I don’t really see anyone complaining about Petro, considering what can be achieved, in contrast with Gabriel Boric. The communist party is actually giving him support.
That all sounds really good. Thanks for that. Who is Mario Silva? Who is Freddy Bernal? Who is the current candidate?
There are many candidates for the election in Colombia. I don’t remember which one was handpicked by Uribe, but it was some kind of public official. The irony is that two female officials of his party would be better suited for this crisis situation and have more political experienced, yet He chose the guy just because he was more loyal. The risk is that Colombia is awakening and Petro getting a considerable amount of the vote means that their grip in power is at risk. a
Before talking about Freddy Bernal, i will talk a bit about Tachira. Tachira state is one of the states bordering with Colombia. This means it’s a potential hot spot for criminals and Colombian paramilitaries to cross here and plan stuff. Given that Tachira was with the opposition several times, this would enable opportunities for those criminals and mercenaries to do their thing. Freddy Bernal was assigned as the “protector of Tachira.” He would essentially be the unofficial guarantor of security in the state, dealing with criminality and paramilitaries.
He just won the governorate in the recent elections, so now he can do things officially with more resources and better capabilities to synchronize things with the other states. The protectorates were established by the government in several opposition states and mayoralities to be able to satisfy the needs of the population in the (sometimes, literally physical) absence of the presence of their elected opposition politicians.
The agreements of the opposition with the government for the elections included removing the protectorates, which is something that was questioned by many on the Left, but it doesn’t seem that they have too many options.
Mario Silva is a famous journalist, better know for his La Hojilla show, where he talks about a variety of interesting topics on a national and international level. His show has a more serious tint compared to the other shows on the state channel VTV. A few days after the Beirut bombing, he talked on his show of the theory of a mininuke. He showed footage of the Beirut explosion, then showed other footage of a similar explosion in Syria for comparison, all of them included mushrooming.
I want to know what do you think of this article Robert Lindsay; Is it true that the anti-business policies of the left are driving these people away?
Every time you put in any kind of leftwing government, including ones that are sorely needed, you get capital flight. It’s a huge problem and the capitalists wave it like a sword over our heads. “Hey don’t try to do anything too leftwing or you will get capital flight!” They’re already threatening this Peruvian guy over that. Sure, it drives them away, but so what? It drives them away because they’re assholes! They only want to invest in shit systems. When you try to make a decent system, they take off. Fuck em.
Let’s be clear about one thing: you can’t just take money out of a country. Money is not a suitcase. Whether you own physical or financial capital in country X, getting out can only mean that you have to sell your asset, which means that someone else will have to buy it.
Suppose that you own real-denominated Brazilian bonds. Lula wins the election in 2022, and you get nervous, so you want to sell those bonds. If you sell it to a foreigner, nothing changes, except the name of the bondholder. If you sell it to a Brazilian, then you will use the reais you obtained from him to buy USD.
The more people do that, the lower the exchange rate of the real will become, unless the Brazilian Central bank has lots of reserves. The problem with currency depreciation is that it will make imports more expensive, which can be a real hardship for consumers. Exporters, on the other hand, will find it easier to sell their products.
If you own a physical asset in Brazil, say, a factory, then it becomes even more difficult simply to “take your money out of the country”. After all, you have to sell the factory. Again, if another foreigner buys it, nothing changes, but if a Brazilian buys it and you want to convert the proceeds into USD, then there will be downward pressure on the exchange rate of the real.
What about simply shifting all of your savings out of the country? What about refusal to invest in the country? What I have heard about the Peruvian elite is that all their money is in US banks. Lot of good that does Peru.
“If we don’t act decisively in defense of freedom, new Cubas will arise from the ruins of todays conflicts.” Reagan. Was Cuba bad or the model Latin American country?
It is certainly possible to transfer savings abroad, and that is not beneficial for ordinary citizens, but a lot of what rich people do is not beneficial to ordinary people. More important than what rich people do abroad is the income distribution.
Suppose that Ruritania is a closed economy. In a closed economy there can’t be capital flight of course. Let’s further suppose that the richest 10% of Ruritanians have 64% of national income. The average income of the richest 10% is than 16 times higher than the average income of the remaining 90%. To a social-democrat like me, that certainly would be highly undesirable, but there is no capital flight to worry about.
Capitalists can certainly carry out an investors’ strike. If they really dislike or distrust a leftwing government, they can refuse to invest, but that is possible also in a closed economy. We shouldn’t become obsessed with balance-of-payment problems.
Concerns about balance-of payment are mainly justified when a country has limited export capacity but has to import a lot of essentials. In such a case, it may not only be necessary to have rigid controls on capital outflows but also to restrict the import of luxuries. If a family has limited income, then it should not allow dad to buy expensive cigars or mom to buy designer cloths.
Let’s take 4 rich Peruvians, Pedro, Pablo, Diego and Carlos. Each year, Pedro transfers 25,000 USD to a foreign bank. Pablo imports luxuries worth 25,000 USD each year. Diego employs 5 Peruvian servants with that amount. Carlos adds 25,000 to his Peruvian savings account each year.
There is no difference between Pedro and Pablo. Diego employs Peruvians, but the services produced by those employees are for him. Those 5 servants could be providing services for ordinary Peruvians. It is never enough to look at job creation. We should also look at what those jobs produce and for whom. Carlos is the only one who is doing what rich people should be doing: saving money in order to reduce conspicuous consumption and free up resources for investment.
We should always think macro-economically, but also worry about distribution. I always use the same example. Let’s take 2 groups of 10 people. In group A, 9 people have an income of 25,000, and the 10th has an income 75,ooo. So the average is 30,000 and the aggregate 300,000. In group B, 9 individuals have an income of 20,000, and the 10th has an income of 180,000. That yields an average of 36,000 and an aggregate of 360,000.
Which group is better-off? Obviously, to a social-democrat, group A is better-off because 90% of the group is significantly better-off than in group B, even though group B has better macro-economic statistics. If you think that group B is better-off, then you qualify for membership in the Republican Party.
Superiority to “spics” is silly. Especially considering many are as White as freshly cut Colombian coke, like Colombian pornstar Dana Sofia. The Coke Kings in Columbia looked like they had a lot of fun, even on house arrest. I like Latin Americans in general. They have attractive women with a good racial range.
Greeks likely age the best in Europe.
The Octaroon ages better than even the Greek. Time is on the darkies side.
I’m very White and Northern looking, so I look for friendliness towards White-ass Whites. I’d likely be seen as a magical-if-eaten albino in Blackest Africa. Brazil would be an Earthly paradise for me at many points. In the Caribbean, I’m partial to Cuba.
Hispanic is not a race! How many times do we need to say it until it gets through people’s heads? They run the gamut from White to Indian. The ones around here at the places I hang out at are very much on the White side in general, though there are some more Indian ones. There are also Black Hispanics, but we don’t have many around here. I met one Cuban Black speaking fluent Spanish. Interesting guy.
Many Colombians are very White. You would be surprised how many of them are about as White as you or me.
I think Greeks do age well.
Yes Blacks do age better than Whites, but Amerindians do not age well at all. I don’t know what’s with them.
Cuba is really nice. I was on a dating site recently and there were all sorts of Cuban women on there coming to me all the time. Very sexy women. They start right out calling you “love” = amor. I don’t think it means they are really in love with you, but it’s a nice change from the typical coldness I get from women these days. Very friendly and very happy go lucky too. The ones I met were pretty White, but some were very nice mixes of White and Black. You couldn’t really see the Black, like in a lot of White-Black mixes, but I knew it was there due to the makeup of the country.
Brazil is an interesting place. I knew some Brazilian women. I had a Brazilian girlfriend once. They are extremely feminine! Love it! Colombian women are also quite feminine but they’re also crazy homophobic, and I didn’t like that too much. A real preference for hypermasculine men, but that’s typical for the continent. Although I didn’t see it so much in the Brazilian women.