Raising revenues until the deficit is reduced to high yielding (NPV>0) projects would be prudent. Since more projects have NPV>0 in recession, the rule is countercyclical as well as growth promoting.
So now we shall see. We’re not a closed system. Models and projections can work or fail for a variety of opaque reasons and modelling economies is not a science, sadly. Thanks for the thought piece.
I basically agree - but it's worth noting it's really hard to get anyone to go out and bat for your description of inflation mechanics. And that's a big part of the problem. Particularly because Reeves way around it has been to hope that growth can cover the needed income - but even if it can, that's going to take at least a couple of years - and some of the public services are coming to crisis before then.
Wholeheartedly agree with your austerity point. On a related note with the UK economy, I’ve been revisiting some of your pieces on the UK’s specialism in professional services. So far, it seems like you are considering this to be a weakness. However, having read through those and also your account in the Unaccountability Machine, I’d argue that our economy should instead be seen as essentially an exporter of ‘doing management cybernetics for everyone else’.
Raising revenues until the deficit is reduced to high yielding (NPV>0) projects would be prudent. Since more projects have NPV>0 in recession, the rule is countercyclical as well as growth promoting.
We had our "black hole" nearly 30 years ago, serving the same purpose
So now we shall see. We’re not a closed system. Models and projections can work or fail for a variety of opaque reasons and modelling economies is not a science, sadly. Thanks for the thought piece.
If debt does not matter, how an inflationary budget could threaten “financial meltdown” because of the expected rise in interest rates?
Answered in the article. Flows not stocks.
Well, if the stock of debt had been zero, the flow of interest payments would have been zero, so no financial meltdown to speak of.
There exist bonds and loans denominated in British pounds that are not issued by the government.
I basically agree - but it's worth noting it's really hard to get anyone to go out and bat for your description of inflation mechanics. And that's a big part of the problem. Particularly because Reeves way around it has been to hope that growth can cover the needed income - but even if it can, that's going to take at least a couple of years - and some of the public services are coming to crisis before then.
Wholeheartedly agree with your austerity point. On a related note with the UK economy, I’ve been revisiting some of your pieces on the UK’s specialism in professional services. So far, it seems like you are considering this to be a weakness. However, having read through those and also your account in the Unaccountability Machine, I’d argue that our economy should instead be seen as essentially an exporter of ‘doing management cybernetics for everyone else’.