Adair Turner’s New Book: Between Debt and the Devil

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Between debt and the devil Adair Turner

Adair Turner became the chairman of the UK’s Financial Services Authority the day after Lehman Brothers collapsed. He was one of the most senior banking officials from 2008 until 2013, so it’s fair to assume that he’s seen more chaos behind the scenes of banking than most of us could even imagine. While he’s never written an expose or biography detailing his experience of trying to rescue a fundamentally broken banking system, key insights have informed everything he’s said and written since. His latest book, Between Debt and the Devil, is no different.

Released on 7th October 2015, the book explains that “our addiction to private debt” is what caused the financial crisis. The blurb shows that Turner’s thinking is close to the arguments Positive Money have been making for the last 5 years:

Between Debt and the Devil challenges the belief that we need credit growth to fuel economic growth, and that rising debt is okay as long as inflation remains low. In fact, most credit is not needed for economic growth – but it drives real estate booms and busts and leads to financial crisis and depression.”

Turner also debunks the big myth about fiat money – the erroneous notion that printing money will lead to harmful inflation.

“To escape the mess created by past policy errors, we sometimes need to monetize government debt and finance fiscal deficits with central bank money.” 

The book is full of detailed analysis of the problems with the current banking system, the tendency for banks to create too much money, credit and debt; and to put most of that money into the property and financial markets rather than financing investment in the real economy. Most followers of Positive Money will be well aware of that analysis (A new era for monetary policy (video) and Overt Monetary Financing), so I won’t repeat it here.

Instead, let’s look more closely at what Turner advocates as solutions. He first covers the idea of prohibiting banks from creating money (before concluding, as he has before, that it is too radical). But he then strongly advocates the need for states to create money and distribute it into the real economy, either through government spending or direct payments to citizens.

Would stopping banks from creating money be a step too far?

Between Debt and the Devil discusses the long history of proposals to remove the power to create money from banks. During the Great Depression of the 1930s, a number of well-known American economists advocated this policy, even presenting it to President Roosevelt as a recovery plan (the idea eventually lost out to the New Deal). Since then, the idea has often resurfaced, most recently with the IMF working paper “The Chicago Plan Revisited” by Michael Kumhof (now a senior researcher at the Bank of England) and Jaromir Benes, in which they model the proposal and found it would be highly beneficial for the US economy. Turner also mentions Modernising Money, written by Positive Money’s research team, which argues for the same proposal.

But Turner lists “three [actually four] reasons for caution” about the idea of stopping banks creating money:

The first is banks can play a useful role in maturity transformation – turning short-term savings into long-term loans, and that it would be a shame to lose that maturity transformation function. This objection makes little sense to us, as the banks advocated in Positive Money’s proposals would still be able to ‘transform’ short-term savings into longer-term loans (in fact, that would be one of the main reasons for using a bank rather than going through, say, a peer to peer lender). It is possible to have maturity transformation without money creation, and so we’d dismiss this reason for concern outright (more here).

Secondly, Turner argues that without banks creating money, we would be reliant entirely on states to create money. The danger here is that they may create too much or use the money for the wrong or inefficient uses. As we’ll see below, Turner ends up advocating a greater role for the state in money creation, and argues himself that the power to create money can be kept under control so that politicians are not free to abuse it. So again, this seems like a weak reason for caution.

Thirdly, Turner highlights the risk that stopping banks creating money will alone be insufficient to constrain credit booms. Other parts of the financial sector may find ways to create equivalent substitutes for state-issued money, or so-called ‘near monies’, that can function as money in the economy. This is a risk to be aware of, but not insurmountable (and in any case, creating a substitute for money is much harder in practice than in theory). Logically, the argument that other measures would be needed in addition is not an argument against the proposal itself.

Finally, Turner states that the transition may be difficult, and that we have to consider where we are starting from and be pragmatic. But we would counter this by highlighting that it is possible to implement the proposals gradually, through a number of pragmatic steps, and without making anyone (or any bank) significantly richer or worse off (see page 33 here).  If the destination is worth going to, the fact that the journey might be tricky is not an argument for staying where we are.

Turner concludes his discussion of these proposals as follow:

“Even if we reject the radicalism of the Chicago Plan [the original proposal to prevent banks from creating money], we should still embrace its key conclusion. We have to constrain and manage the quantity and mix of credit that the banking or shadow banking systems create.”

Central banks must create money for the real economy

Turner describes the current economic situation worldwide, and states that

“We will never get out of the current malaise, return inflation to target, or reduce debt levels unless we increase demand in our economy.” (p214) 

Thankfully, there’s a clear solution to this problem:

“We can always stimulate nominal demand by printing fiat money: if we print too much, we will generate harmful inflation; but if we print only a small amount, we will produce only small and potentially desirable effects.” 

This is completely consistent with Positive Money’s proposals. For too long we’ve relied on banks to fuel economic growth by creating money when they lend. The problem is that this leads to (a) new money being created too quickly when banks get over-confident, fuelling high house prices and financial market bubbles and (b) a huge build-up in private debt (i.e. debt of households, and to a lesser extent, businesses). What is needed now is for the Bank of England (or the European Central Bank or US Fed) to create money and spend it into the economy, without relying on any household or business to take on further debt. Whereas Quantitative Easing involved creating hundreds of billions of pounds (or dollars or euros) and putting that money into the financial markets, this policy would get money directly into the real economy, where it would create jobs and boost GDP.

Such policies are now being discussed by the new Shadow Chancellor John McDonnell, and have been endorsed by a wide range of economists, as well as those from the financial sector who have seen current policies failing.

The money that the Bank of England created could be used either to finance government projects, or to finance a one-off or monthly payment to every citizen in the country. Turner emphasises this second policy, often referred to as ‘helicopter money’ (as if the money dropped out of a helicopter into the hands of citizens). Such a policy, he argues, would be significantly better than what we’ve tried to date:

“[C]ompared with a pure monetary stimulus [such as QE], [helicopter money] works through putting new spending power directly into the hands of a broad swath of households and businesses, rather than working through the indirect transmission mechanism of higher asset prices and induced private credit expansion. It does not rely on regenerating potentially harmful private credit growth nor does it commit us to maintaining ultralow interest rates for a sustained period of time.”

“Ideally, the major advanced economies should have implemented Bernanke-style helicopter money drops in the immediate aftermath of the 2007-2008 crisis. If we had done so, the recession would not have been so deep, and we would now be further advanced in escaping the debt overhang.”

If only… But there may still be time to correct past mistakes, and this policy is still needed.

What about the risks? One is the possibility that putting more money into the system (and boosting spending and the health of the economy) will encourage banks to start another dangerous credit boom. Turner argues that this can easily be avoided, through restrictions on banks creating money, via various regulations (i.e. leverage ratios can be increased in order to offset any money creation by the state). Although he doesn’t say so, this approach might be one feasible transitional path towards stopping banks creating money altogether: as the state creates a greater percentage of the additional money that enters the economy, the restrictions would be increased to limit what banks can create.

A bigger risk of course is that once the creation of money in the public interest becomes popular, people will demand more of it. Politicians with direct control may want to overuse the policy, and those with independent central banks may try to pressure the central bankers into creating more money when it is politically advantageous (i.e. before every election). But again, Turner argues that it is fairly easy to overcome these risks:

“So should we lock up the medicine and throw away the key? I don’t believe so for two reasons. It is in principle possible to design institutional mechanisms to place appropriate constraints on excessive use. Second, because the alternative route to nominal demand growth – private credit creation – is just as dangerous. We face a choice of dangers, not inevitable perdition on the one side and perfection on the other.” 

“There is no reason the use of monetary finance [i.e. money creation by states to finance public spending or payments to citizens] cannot be appropriately constrained within precisely the same discipline of central bank independence. Central bank committees that today vote to approve interest rate movements or quantitative easing operations could also be given the power to approve or disapprove either a Bernanke-style helicopter money drop or a one-off government debt write-off.” 

Indeed, at Positive Money, we believe that with the relevant institutional mechanisms central banks should always be allowed to create money for spending directly into the real economy whenever aggregate demand is below a certain threshold. In this sense, monetary-financing for the real economy could be an additional instrument added to the central bank’s ‘tool box’. This is not to suggest that monetary-financing would be used for funding government deficits, rather it could be another macro-economic tool at the central bank’s disposal to help manage aggregate demand within the economy.

With interest rates at the zero-bound level for the last six years it is clear that they are not an efficient tool for stimulating aggregate demand in the real economy. If anything, the reduction of interest rates combined with conventional QE has helped to increase asset prices to all-time highs and has led to a number of bubbles in financial markets – increasing financial instability. Thus, injecting central bank money into the veins of the real economy would not only do a better job of stimulating demand, but would also reduce future financial instability. 

From an economic standpoint, there are a number of reasons for allowing central banks to create money for the real economy. The Chinese economy has hit a slump and potential global growth rates are consistently being revised downwards. Threats of deflation are looming, and even core inflation (inflation stripped of oil and commodity prices) is at extremely low levels – indicating a slump in aggregate demand. The World’s leading economic institutions (i.e. IMF, BIS, OECD etc.) are all warning that current monetary policy is increasing financial instability. Meanwhile, both public and private debt levels are at all time highs (since 2007 global debt has increased by $57 trillion).

Allowing central banks to create money for the real economy would trigger a boost in aggregate demand without a corresponding increase in net debt and without promoting further financial instability. The ratio of debt to income could be lowered, as increased spending would take place without governments increasing their budget deficits and without the private sector increasing levels of borrowing. Lower debt to income ratios would make our financial system more resilient to potential shocks. Central banks would also be better equipped to deal with such shocks if they were permitted to create money for the real economy.

Between debt and the devilUltimately, it is a breath of fresh air to have someone of Lord Turner’s calibre offer an analysis and proposals that are outside of the box and that have genuine potential to achieve what current policy-makers are all trying to do but cannot. Indeed, we thoroughly encourage anyone trying to get a better understanding of money, debt and credit cycles to read Between Debt and the Devil. Not only does it provide an accurate understanding of many of the problems emanating from the current monetary system, but it also offers an excellent understanding of the potential solutions and why these solutions are the next logical step in generating growth and increasing financial stability.

*The book will be launched at the LSE event on October 21st, 6.30 – 8.00, with Lord Turner and Robert Peston in conversation about the arguments.

 

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Ben Dyson (Positive Money)

Ben is Positive Money's Head of Research. He founded Positive Money in 2010 and is a co-author of Modernising Money. Ben's research focuses on potential reforms better forms of monetary policy, structural reforms to the banking system, and the potential for technology to disrupt the payment and banking systems.
  • RJ

    “Whereas Quantitative Easing involved creating hundreds of billions of
    pounds (or dollars or euros) and putting that money into the financial
    markets,”

    PM need to be careful making these sorts of statements. At best its misleading. At worse its a misleading falsehood. It gives the impression that the BoE somehow created bank credit or notes and coins (they didn’t) are gave this away with no attachments to financial markets. This obviously is rubbish. (but some believe this did happen).

    In fact what happened was the BoE created new reserves and swapped this for bonds of equal value. The journal entries were (1 billion bond purchase purchased ABC Ltd)

    BoE–> CREDIT banks account 1 billion = liability // DEBIT Bonds asset purchased ABC Ltd
    UK banks—> CREDIT banks account 100 billion = liability // DEBIT BoE Reserevs
    ABC Ltd —–>CREDIT Bond £1 billion =asset reduction // DEBIT Bank Account

    So ABC Ltd losses one asset and gains another one. Would you sell your house and get nothing in return for it. Likewise ABC Ltd

    • Barney Rubble

      This is a very silly criticism…not least taken out of context…for some QE is a big issue – as it helped reinforce inequality around the world, when it could actually be one of the best tools for reducing income inequality…Your trolling is becoming quite annoying and it looks like your are just picking at PM things for the sake of it now…I personally believe you have better things to do with your time…

      • RJ

        “- as it helped reinforce inequality around the world,”

        How exactly did it do this. And please address the points I raise (you haven’t) rather than falling back on the just trolling escape route. Because if PM can not address my basic simple points then they have no hope of being taken seriously at any other level than a minor irrelevant group.

        I actually think PM are doing very good work but they need to be a lot more precise. And answer genuine challenges in detail.

        • Barney Rubble

          Do I need to cite the BOE report that shows how BOE reinforces inequality?

          If you read the whole sentence you cited, and dont take it out of context then you will see what I mean.

          “Whereas Quantitative Easing involved creating hundreds of billions of pounds (or dollars or euros) and putting that money into the financial markets, this policy would get money directly into the real economy, where it would create jobs and boost GDP.”

          The point of the sentence was to show that QE has pumped billions into the financial economy, instead of directly injecting into the real economy. This is the impression it gives when you read it, end of.

  • RJ

    I like the PM proposal. Its a smart idea although I agree 100% with the Turner reservations about the secondary markets. But the reservation I have is not with this but the danger of change

    Govts in the world are monetary sovereign due to a mistake. This means they can spend without limit right now when required as required. But this “unfortunate” situation came about due to the US moving to a large trade deficit country. So they had no choice but to move off the gold standard. Ever since the ruling elite have tried to rectify this mistake.

    The Euro did rectify it. Fixed currencies also do. Bonds issued in another currency also do. All these situations take power away from the people and return it the he ruling class power

    My fear is that any change will be to our detriment otherwise it will not occur. Taking power away from the UK Govt THAT THEY CURRENTLY HAVE and giving it to an appointed committee is not too different to a Euro type situation.

  • FWHMyers

    I am heartened to read of Turner’s book supporting the analysis of Positive Money (if not all the reform proposals).
    I am though slightly disappointed that so much of the writing within PM literature (and within alt economics generally) is locked into the universally accepted and largely unquestioned dogma that GDP growth is the desirable goal of reforms and policies.
    I was drawn to PM from environmental considerations- that it might offer a way of limiting or even reversing ‘growth’ in a democratic and equitable way without the whole system collapsing into chaos. Helicopter money especially, seems an idea built upon the premise that stimulating demand (i.e. people going out and buying stuff) is a desirable outcome, and I would expect that short of binding restrictions on where the public could spend that money, it would mostly go on gadgets, gizmos and general consumer products rather than the much needed restructuring of our society towards a sustainable model.
    I realise that it is a kind of taboo to even question growth, but it is one that needs to be challenged. Monetary reformers are well placed to do this.

    • Lars Alaeus,

      I completely agree that growth in real terms has to stop and also be reversed. And the Sovereign Money proposal from PM will be able to handle degrowth by removing money from circulation in the same way that money is added in a growth situation.

      Since removing money in the same way as adding will be be done through removal of money from the state budget, it is not that politically nice. But when doing this there will be no problem to keep the inflation steadily at 2% even during a degrowth of both the GDP and the real economy.

      So for me it is clear that the Sovereign Money System is necessary as a base to make it at all possible to handle the degrowth that this globe so desperately needs. Without it the growth both in terms of GDP and real will have to grow until it crashes.

      • RJ

        “I completely agree that growth in real terms has to stop and also be reversed”

        Sorry but this is nonsense. There are millions in the world that are in desperate need of higher living standards. Growth is the only way to achieve this. But if the world or the UK Gove directed money to say potentially very cheap energy like 4th generation mini nuclear rather than polluting energy source (including wind turbines) then we could all slowly benefit. Rather than restricting high living standards to the few.

        • FWHMyers

          I disagree RJ. The argument is that we are crashing into the buffers (on many fronts, not just energy production), and GDP growth is the locomotive powering us onwards ever faster.
          http://www.theguardian.com/global-development-professionals-network/2015/sep/23/developing-poor-countries-de-develop-rich-countries-sdgs?CMP=twt_gu

          • RJ

            This is fiction. Look at computer and the massive gains in technology. What we have today is almost a miracle. But sometimes it is held back by people who write this sort of stuff.

        • Lars Alaeus,

          My point is that a Soveign Money system can handle degrowth in GDP which the current fractional reserve system cannot do without crashing.

          It also makes it more easy for the government to direct money to developing sustainable energy sources.

          And most important of all, the flow of value from those who have to borrow and those who can lend (mainly banks and financial institutions) will be much less since the total volume of debt will be much lower. And this is true both for states and individuals.

          So for me it is clear that the ‘millions in the world that are in desperate need of higher living standards’ will get a much better situation when their country has switched to a Sovereign Money system.

  • Howard

    I think it is critical to disconnect the creation of money from banks, public or private. The creation of money should be solely the prerogative of government, not banks. The creation and spending of money into the economy must be based on democratic process to address human and ecological needs rather than the banker’s perspective of ‘is there a good return on investment’ from a purely monetary viewpoint. The value of healthcare, education and ecological restoration go well beyond just the monetary considerations. I agree we monetary reformers and in good position to challenge growth, especially industrial growth and the growth of debt. We are witnessing the globalization of catastrophe due to the narrow goals of privately created money and crushing debt.

    • RJ

      “creation of money should be solely the prerogative of government, not banks”

      Or privately owned banks. This could be easily achieved by Govts nationalizing all the banks (that they could do). But Govt’s already have huge tax and spending powers as well as the right to make laws in the UK (they have surrendered this power largely to the EU but could take it back). They can also today spend without limit using if they want the BoE to create interest free money. They do NOT need to issue bonds to the market to drain reserves except for self imposed regulations.

      Giving them even more power could be very dangerous. Do you thInk Govt’s today operate in our interests?

      • Howard

        No, they don’t operate in the public interest, they operate in their creditor’s interests. Giving government the legitimate power to actually do things without having to get approval from private banking interests might make them more willing to serve the public interest. Aristotle noted that governments make the mistake of giving too much power to the rich which creates problems causing governments to overstep the people. The rich have always convinced us that we can’t run our own government, that they should have the power over the purse. Do you think that privately issued money has really served us well?

        • RJ

          “Giving government the legitimate power to actually do things ”

          The UK Govt already has this power (but pretend otherwise and a foolish public believe them). At least the UK (and NZ / US / Aust etc Govt’s have) has but not euro countries.

          • Howard

            I think most were forced into it based on their ignorance of money, thinking it was gold, and, for the lack of it, going into heavy into debt for wars. The US won its revolution then “gave” away the power to the private banks, as Alexander Hamilton said, “The United States debt, both foreign and domestic, was the price of liberty.” How much liberty do you feel with a debt? Anyway, somehow I got the idea that most governments worked similarly. In the US the corporate lawyers write the bills that Congress hasn’t got time to read hundreds, sometimes thousands, of pages because are very busy fundraising, but the helpful corporate lobbyists tell them how to vote and give them their talking points. The corporations, who work as profit centers for the banks through which banks can guide activities in every industry. A few hundred people direct the dominant players, while the population is divided and fighting among themselves over as many different things as possible, media generated conflict, something for everyone, so they don’t get together and compare notes. A government that does not issue the money will be controlled by those who do. We have war poverty, disease, racism, addiction, famine, murder, corruption, to name a few, under the private money system. They have refused to allow any country to become independent of central bank authority without risk of invasion. Private money is based on personal gain, a sin called usury, while public money, if ever allowed, is based on care. Private money concentrates at the top, public money spreads out broadly to provide for human ecological needs..Public money is the foundation of a democracy and now you know why they fight it. It is civilizations number one political issue, a revolution that’s never been won, but …now …….our lives depend on it.

          • RJ

            But public money is allowed and we have it right now in the UK.

            Higher level money (BoE reserves) is what the banks and treasury (Govt) use as money to settle with each other. It relates one to one for bank credit or notes and coins.

            The Govt (BoE) can create as much as they want when they want and at whatever interest rate they want any time they want TODAY. And they do exactly this when they pay someone.

            It’s like someone owns the most beautiful house in the university. But someone else who is not working in their interests has told them they are not so they should change the whole system so they have a better house to live in. The plan of course is to take over your great house. And replace it with a rented apartment like has happened to Euro countries.

            I’m telling you how wonderful this house is in fact but people refuse to believe me.

  • FWHMyers
    ‘I was drawn to PM from environmental considerations- that it might offer a way of limiting or even reversing ‘growth’ in a democratic and equitable way without the whole system collapsing into chaos.’

    Taking FWHMyers’ comment as an example there exist many misunderstandings concerning creating ‘new money’ by a State Bank and what can be done with such and what are the risks concerned.

    Any focus on ‘QE for the people’ as the ultimate solution for any and all economic and financial errors of the economics of today in itself is misguided and misleading. As is such naked conviction that ‘investment in infrastructure’ would be, or that such naked accounting techniques as described in the IMF ‘The Chicago Plan Revisited ‘ 2012 paper would be.

    Any government given the power of the purse to execute the creation of money can then do so on political whims, is capable of making small or even grave errors or can possibly already be corrupted from the very start or become gravely corrupted in the process or could be found to consist of the blatantly stupid, all this contrary to the implicit notion it seems by Positive Money-ers that a program of government money creation would be well executed by behaved government officials because the Plan considers decent rational people (only).

    That any governments action is led by altruistic, humane and selfless rationale is an historical error, carelessly and currently handing the power to print money over to any and all of Labour and Tory pundits would be equally uneducated and, bluntly speaking, would be either ridiculous or stupid, without fitting conditions.

    One can extrapolate from present economic needs, wants and urgencies if only relatively so, the condensed subject matter what ‘fitting conditions’ would involve and have to address.

    And I will abscond here of a dozen or so lengthy considerations (re Adair Turner: ‘In fact, most credit is not needed for economic growth’) to plainly conclude as I have done previously.

    The central prerequisite for printing money is the repair of, the improvement of, the restauration, protection and maintaining if and where possible, conceivable, imaginable, promising, and feasible, of The Environment.

    Then, the man and womenpower for This Agenda that in present economic doctrine would wrongfully entail hopeless deficit spending can and would be recruited from the plentiful pool of those tens of millions of people in existence now, to be found eager and willing to help materialize such an indispensable endeavor concerning The Environment.

    The raising of minimum wages, benefits, subsidized education, subsidized transport, subsidized medical care, subsidized pensions and the involvement of countless enterprises and entrepreneurs to be recruited because of their specialized skillsets and such are and should be the mere but politically perhaps alluring consequences of such this central prerequisite concerning a Peoples QE directed at The Environment.

    Let me repeat this.

    A Peoples QE by necessity must be directed at The Environment.

    Marcel Tjoeng – Netherlands

    • RJ

      Who are you to dictate to the UK people how we should run our affairs. Ask the Greeks how this is working out for them. Being run by an outside force.

      And this notion that all growth is bad is just rot. Promoted by people who are living the good life but do not want others to do likewise. And it’s not an either / or situation. We can have in this world clean, cheap energy and be caring for the environment (not destroying it with ugly wind turbines and spewing out real pollution etc) but also care for the elderly and poor. Rather than treating them like scum.

      • I suppose you’re reacting somwhat to my post but essentially you havent really read it?

      • FWHMyers

        RJ – it is clear that you are an advocate for growth, but please spare the rhetoric implying that degrowth advocates are anti-technology per se, or that they are motivated by a selfish desire to keep people in developing countries impoverished. These statements are untrue and ridiculous.
        Degrowthers are concerned that that there simply are not the resources to develop all nations on Earth to the extent of the Europe/ USA. Not the fuel, not the soils, fresh water, minerals, human capacity. How many airports and aircraft would have to be built to allow all the people of S America, Africa and SE Asia the same access to air travel as we have? All the while there is the (economic growth) pressure to expand capacity in this country. It just cannot be done. What do we do? How many nuclear plants would have to be built to power not just all the cars that we now run on fossil fuels, but all the billions of cars that would have to be built for there to be some equitable access to them around the world. How many roads? It is just off the scale ridiculous, it is techno-utopianism.
        The problem is not technology (the presence of it or the lack of it) it is consumer capitalism’s determination of how those technologies are developed. Consumer capitalism is a response to the need for perpetual exponential economic growth, it is technology developed for private profit. I want technology developed for conviviality and sustainability.
        We need to scale back economic activity, and dismantle the growth imperative, not ‘return to the stone age’- you are making a false dichotomy by suggesting that. Our whole culture is centred on buying, selling and accumulating, and we need to relearn how to share, be sparing, sometimes even do without for the greater good.
        Questioning growth is a taboo, but we must, for some forms of growth are cancerous.

        • ‘and we need to relearn how to share, be sparing, sometimes even do without for the greater good.’

          The new meme, the concept, that could and should replace the ill-reputed ‘GDP growth’ meme is a quality-of-life model.

          A healthy or rather an appropriately retained environment provides value that equally, even, in todays economics rational can be quantified in a value number.

          Ridding ourselves of the (rather ridicules) ‘GDP growth’ idea that is part of the everyday ritual of economical ‘science’, and keeping Yanis Yaroufakis comment in mind that the present day presentation of economics as a science is a misleading falsehood that disallows the political facets of economic theory, doesn’t mean we have to forego ‘growth’, again such a misleading terminology of everydays economists.

          What must or can happen in a new way of economics practice is equally the qualification as the quantification of desired and required growth as in the opportunity to spend and invest in sustainable development.

          And that I can predict you, has an enormous number attached to it that will dwarf any present ‘GDP growth’ number.

  • ‘and we need to relearn how to share, be sparing, sometimes even do without for the greater good.’

    The new meme, the concept, that could and should replace the ill-reputed ‘GDP growth’ meme is a quality-of-life model.

    A healthy or rather an appropriately retained environment provides value that equally, even, in todays economics rational can be quantified in a value number.

    Ridding ourselves of the (rather ridicules) ‘GDP growth’ idea that is part of the everyday ritual of economical ‘science’, and keeping Yanis Yaroufakis comment in mind that the present day presentation of economics as a science is a misleading falsehood that disallows the political facets of economic theory, doesn’t mean we have to forego ‘growth’, again such a misleading terminology of everydays economists.

    What must or can happen in a new way of economics practice is equally the qualification as the quantification of desired and required growth as in the opportunity to spend and invest in sustainable development.

    And that I can predict you, has an enormous number attached to it that will dwarf any present ‘GDP growth’ number.

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