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I'm not entirely certain what the conclusion of the essay is, ultimately. It argues that central banks have been reducing the "neutral" rate over time, and lowe
by PuppyTailWags 4y ago
I'm not entirely certain what the conclusion of the essay is, ultimately. It argues that central banks have been reducing the "neutral" rate over time, and lowered interest rates indicate an economy that needs to induce demand. it argues that an aging population demands less. It also argues that income inequality contributes to reduced demand. These are things I understand.
But it just ends in arguing that choices can be made about income inequality and "Let's get to work". What is the work, precisely? [Asking genuinely. I'm not a wealthy person who can buy a politician or give poison money to an academic institution to teach my philosophy. I don't know what the essay wants from me.]
- losteric 4y agoThis piece seems to be focused on explaining the state-of-the-world, with a clear theme of needing wealth redistribution in my uniform. I like that they didn't propose policies, as that brings in personal opinions.
- PuppyTailWags 4y agoOkay, but this whole essay is just a well-argued, well research personal opinion. That's kind of what an essay is. I'd like to know what I'm supposed to do with it.
- di4na 4y agoBasically it tells economists and anyone that think they can have an impact to present ways to change this inequality stuff.
- dragonwriter 4y ago> But it just ends in arguing that choices can be made about income inequality and “Let’s get to work”. What is the work, precisely? The clear implication is “policies that address inequality.” (Unfortunately, the only example the article gives is the wartime mobilization [0] that corresponded with the end of the Great Depression, which implies that the solution is to mobilize and launch a massive global conventional war, which seems both impractical and likely to have undesirable direct and indirect effects that would outweigh any salutary effects on the domestic distribution of income and wealth.) [0] And unfortunately fails to point to a variety of anti-inequality domestic economic policies that were adopted within the US under the political cover of the war, which would–though definitely controversial–be a much more interesting discussion point than “wartime mobilization”.
- gemstones 4y agoI have no idea how to accomplish this in our current political structures, but the way cultures have historically solved this is through periodic debt forgiveness. (Every 7 years in the Torah, Babylon did it at the discretion of the king, etc.)
- vineyardmike 4y agoOr through large inflation that devalues existing debt
- Rury 4y agoDebt forgiveness can help reduce inequality, but so can holding people to their debt obligations. And either can also increase inequality. It entirely depends on the circumstances surrounding the debt.
- dragonwriter 4y agoIt is true that many historical cultures have had a traditiom of periodic or irregular debt forgiveness. I think it is far less clear that the effect of such traditions was to constrain inequalities of wealth or income, or even that, lacking the ability for a narrow elite to organize extractive systems at the scale possible in the modern world, historical societies even had anything meaningfully comparable to modern problems in that domain to address.
- imtringued 4y agoThere wasn't much economic growth at the time so paying interest was pretty much a literal debt trap. Forgiving debts definitively helped with poverty back then.
- lukas099 4y ago> anti-inequality domestic economic policies that were adopted within the US under the political cover of the war Care to speak a little more about those? My impression was that FDR's focus shifted drastically away from New Deal policy-making upon the US's entry into the combat.