No time, plenty of money and a dearth of ideas: the modern economic plight

Posted on December 5 2011

As Larry Elliott says in the Guardian this morning:

As things stand, economic policy lacks intellectual coherence, monetary policy is governed by a belief in the need for unrestricted credit, and fiscal policy by a belief in "expansionary contraction". It is a mishmash based on one big assumption; given time, the grown-ups can fix things. There are three possible responses to this: they can fix it given time; they can fix it if they use a different toolkit; they can't fix it at all because the system is bust. You decide.

My answers are:

1) We haven't got time

2) We aren't bust - the system is flush with money

so

3) We need a new toolkit.

Hence The Courageous State.

I don't for a minute say it is the only alternative to what we've got, and I'm sure my own thinking will develop. But if we don't try we'll get nowhere. That's why I wrote it.

What's better? Try something different or simply bow down before the bankers and say 'take it all?'. That's what most politicians are doing right now. And I'm absolutely sure that the people of this country, and all countries, want something better than that.

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3 Responses

  1. Ian Stevenson says:
    December 5 2011 at 6:14 pm

    Not liking the system is not enough. We need a credible alternative.
    As you say in your book page 166 banks create money-and then charge us interest. The Courageous State should take back the creation of money. New Economics Foundation has a paper by Huber and Robertson which gives us a model. Richard, do you think it is viable?It looks to me as if it would make us free of bond markets eventually. One of the sad things of the present crisis is the hyping up of nationalistic stereotypes and antagonism.
    We need a coalition (not the one in power) of people to campaign for a focused alternative.

  2. larry Levin says:
    December 6 2011 at 2:38 pm

    are RBS really going to pay £500million in bonuses?

    “David Cameron yesterday vowed to stop state-owned bank RBS from lavishing £500million in bonuses on its staff this year.”

    from the daily mail.