FROM APOLLOSPEAKS TOWNHALL ARCHIVES
2010-05-13 14:09:09 -- THE SON OF JOHN GALBRAITH: CHIP OFF THE OLD CROCK
James K. Galbraith crackpot leftist economist with a New General Theory on Endlessly Growing Deficits Without Causing National Bankruptcy.
Economist James Galbraith of Texas U, son of leftst economist John Galbraith (the mastermind who wrongly warned JFK that supply side tax cuts would precipitate the recession he was trying to avoid) was interviewed by Ezra Klien for the Washington Post on the long term dangers posed by deficit spending. Son James, a chip off the old man's crock, says that the danger posed is absolutely "ZERO;" and those who believe otherwise are hysterical and unhinged. I'm not kidding you: Galbraith said to Klien:
"Government does not need money to spend just as a bowling alley does not run out of points. What people worry about is that the federal government won't be able to sell bonds. But there can never be a problem for the federal government selling bonds. It goes the other way. The government's spending creates the bank's demand for bonds*, because they want a higher return on the money that the government is putting into the economy. My father said this process is so simple that the mind recoils from it."
*This reminds me of the leftist theory that higher taxes is good for people because it makes them work harder to earn more money.
This is the theory of an unrealistic utopian imbecile who's forgotten economics 101; a man intoxicated out of his wits with the dream of socialist heaven and the only means of getting there: unlimited, budget busting, deficit spending and borrowing. That the value of government bonds at some point will collapse into worthlessness killing demand isn't even a remote possibility for Galbraith who assures us that there will always be a huge market for them whatever their rating. Obama's Audacity of Blind Hope must be Galbraith's political bible.
And so, according to Galbraith, we can spend baby spend, endlessly, fearlessly, limitlessly spend until Obama's vision of the More Perfect Union is realized-the good and great society of prosperity and success for all (like the miracle of Greece where banks are being torched because they're no longer needed). The end justifies the means, the means of deficit spending and growing debt, and the dangers posed by these (national bankruptcy and collapse) are paranoid, rightwing scaremongering fantasies that we must ignore.
Let not your heart be troubled. Banish all fear from your mind. Fortune favors the bold and we must boldly plow ahead to the goal of societal perfection and never look back lest we turn to salt. It's a moral, social, political and global necessity. Humanity has a right to it; all history demands it; all time and eternity call for it. Giving up the worthy, noble, glorious goal of classless equality (where high and low, rich and poor exist no more), for foolish reactionary right-wing fears of insolvency and ruin is a crime against humanity bringing progress to a halt. We must get there at all costs. What are trillions in debt compared to this priceless ideal that pays for itself a zillion times over when it's reached? Greece, Spain, Portugal and Italy must put spending on hyper-steroids, it's the only way to fix their mess and resume social progress. Forget about systemic restructuring, privatization and austerity, this is regression to the past-to a less civilized state of dog eat dog survival of the fittest greedy unjust capitalism. Such backsliding and heresy mustn't be tolerated.
Galbraith's views on the moral necessity for endless deficit spending is in proportion to his unreachable goal of socialist heaven and perfection. Since the precise amount of money to reach the goal can't be measured, quantified or known he's concocted a hairbrain theory that limits on federal spending and subsidies are unnecessary and wrong. Wrong until we get there; until the dream of perfect justice and economic equality is realized and society is epically redeemed.
Once the Promised Land of social justice is achieved, however far off, then we'll know that we've reached the upper limits of borrowing, deficits and accumulated debt and these will take care of themselves, vanish in time as if by magic (along with the state). This is Galbraith's theory of the withering away of the national debt. How simple. How elegant. How sublime. Worthy of an Einstein. "The road of excess leads to paradise," William Blake had it right all the time. Until then it's full steam ahead to nirvana whatever the costs and consequences-whatever the mishaps along the way: recessions, depressions, hyper-inflation don't worry, they can be fixed by greater spending fueled by an inexhaustible supply of willing investors.
Surely our reckless, spendthrift, ignorant president is going gaga over Galbraith's views; since this is exactly the dangerous Neverland course that he and his party blindly pursue.