Friday, April 17, 2015

Frances Coppola — Colds, strokes and Brad Delong


Economic and policy malpractice. Who do we sue for damages?

Having said that, Brad's last comment is spot on:
The key questions of macroeconomic political economy then are not the questions of the construction of nonlinear multiple-equilibrium models that Frances Coppola wants us to study. They are, instead, the questions of why ideological and rent-seeking capture were so complete that North Atlantic governments have not deployed their fiscal and credit policy tools properly since 2008.
This is only half right. It's treating a preventable condition after the fact. Why did governments adopt ideologies that enabled not only rent capture but also state capture in the first place. 

The answer is simple. It is the result of a failure of representative democracy to prevent the development of oligarchic "democracy." This is a form of plutonomy similar in many ways to feudal aristocracies. It is based on institutional arrangements dictated by special interests, namely, the vying factions of a ruling elite who carve up the spoils among themselves based on their ability to gain and wield power.

Coppola Comment
Colds, strokes and Brad Delong
Frances Coppola

2 comments:

Anonymous said...

Even if we had deployed our fiscal and credit tools properly since 2008, we would still live in an economically evil society.

The events of 2008 broke a lot of cheery facades and helped us all see the cruelty, plutocratic domination, exploitation and systemic ugliness that the US economy is built on.

If we had followed some of the countercyclical policies DeLong wants, we would have rebuilt the facades faster. But the underlying shittiness would still be there.

John said...

Dan, that's rather well put.

Far too much traditional "Keynesian" economics, and for that matter PK and MMT, is about patching the system up. But their respective insights, even the highly diluted taste-free traditional "Keynesian", are far more radical and allow for a much more decent society.

Presumably the reason these radical policies are not pushed into the public sphere is that progressives are so politically (and intellectually) weak that they end up singing, but not quite as loudly, from the same hymn sheet as Pete Peterson and Simpson-Bowles.