I felt this one tweet very precisely summarised the 21st century economic problem, which has impact far beyond Japan:
So the answer is, increase wages and reduce cash piles.
Which means higher corporation taxes on large businesses should be on the international agenda, but they're not.
Why not?
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Shock headline:
IMF Spends Decades Creating Problem Then Announces It Is a Problem!!
Why not? Because our politicians keep telling us that higher taxes harms business and we will all suffer. It’s the corporates’ project fear. It always puzzles me that corporations fail to see if you squeeze the workers too hard there is no one left standing to buy the product. I guess they always think that it will be their rivals that go under first, leaving more rewards for them.
In terms of the circuit theory of money, it is obvious why anyone sitting on a cash pile is bad – because there is less circulating in the rest of economy. If those cash piles are in tax havens, even worse. Keep up the good work Richard!
I will….
Charles, it’s worth observing that the problem you have pointed out – that of squeezing the workers – is millennia old.
Indeed, it is precisely this that led to the actions taken by the great law-giver, and one the the ancient Seven Sages, Solon, who enacted a radical solution called the “seisactheia” (the “shaking off of burdens” – see https://www.britannica.com/topic/seisachtheia).
In a nutshell, the rich had so stitched up the poor, that there was no liquidity left in the economy, and the only way to restore liquidity was to cancel debt burdens.
The human race can be such a wearisome species – forever failing to see what is as plain as the nose on their face, and forever failing to learn from the lessons of history.
“Those who do not learn from the past are condemned to repeat it”.
Andrew – I was once told by a wise Hindu friend that the answer to the question ‘What is the meaning of life?’ is ‘right in front of us – at the tip of our nose. The trouble is it’s difficult to see!’
The principal reason the human race is eternally plagued with never ending problems & suffering is because we look for external solutions to internal issues, forever applying ever more sophisticated (technical) BandAid to assuage the incessant bleeding without attending to its root cause.
Professional politicians don’t want the public to become ‘self-realised’ as it would put them out of a job. A bit like doctors becoming redundant if we were all healthy. Hence there is an ’embargo’ on any suggestion that spirituality should play any role whatsoever in social management. There is no longer a moral compass to guide the global elite – if there ever was one.
However, I believe their time is running out as increasing numbers (millions) of people are beginning to understand how badly they are served and deceived by their undemocratically elected representatives. And the Internet is playing no small role in this evolution, where anyone can now access wisdom that was once forbidden, and listen to talks from the world’s great teachers.
I have sometimes posted that I’m pessimistic about the medium term because of the draconian hold the neo-liberal/neo-con ideology has on the general public, in the same way that institionalised religion ‘enjoyed’ in Europe for centuries. But the longer-term prognosis is a lot more encouraging. How it will eventually pan out I’ve no idea. But one thing is certain – “The old order changeth yielding place to new …” (Tennyson)
Recent report from the IMF suggesting that double digit unemployment will last until 2050 despite the civic tragedies that IMF restructuring involving ‘internal devaluation’ has caused:
” The authorities’ current targets remain unrealistic, in that they still assume that Greece will attain and sustain primary surpluses of 3½ percent of GDP for many decades–despite double-digit unemployment rates until the middle of the century–and at the same time achieve high growth rates. In this context, it cannot be assumed that Greece can simply grow out of its debt problem. Further debt relief will be required to restore sustainability, going well beyond what is currently under consideration, and it should be calibrated on realistic assumptions about Greece’s ability to generate sustained surpluses and long-term growth.”
The IMF is playing the role of a cruel god!
…
http://yournewswire.com/deutsche-bank-collapse-inevitable-prepare-for-economic-armageddon/