John Kenneth Galbraith
In economics, the majority is always wrong.
The mind is repelled
John Kenneth Galbraith
The process by which banks create money is so simple that the mind is repelled.
Government has a printing press
Ben Bernanke, 2002, National Economists Club
Deflation: Making Sure “It” Doesn’t
According to Bernanke:
But the U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost.
Alan Greenspan, Federal Reserve Chairman, 1997
"[A] government cannot become insolvent with respect to obligations in its own currency. A fiat money system, like the ones we have today, can produce such claims without limit."
It's not tax money
Interviewer Pelley asks Federal Reserve Chairman Bernanke:
Is that tax money that the Fed is spending?
Bernanke replied, reflecting a good understanding of what we call central bank operations (the way the Fed interacts with the member banks):
It’s not tax money. The banks have accounts with the Fed, much the same way that you have an account in a commercial bank. So, to lend to a bank, we simply use the computer to mark up the size of the account that they have with the Fed.
Sole manufacturer of dollars
St Louis Federal Reserve:
"As the sole manufacturer of dollars, whose
debt is denominated in dollars, the U.S. government can
never become insolvent, i.e., unable to pay its bills. In this
sense, the government is not dependent on credit markets
to remain operational. Moreover, there will always be a
market for U.S. government debt at home because the U.S.
government has the only means of creating risk-
free dollar-denominated assets..."
Real Assets vs Financial Assets
Building bank reserves will not expand credit
Bank of International Settlements
Unconventional monetary policies: an appraisal
In fact, the level of reserves hardly figures in banks’ lending decisions. The amount of credit outstanding is determined by banks’ willingness to supply loans, based on perceived risk-return trade-offs, and by the demand for those loans. The aggregate availability of bank reserves does not constrain the expansion directly.
No merit to balanced budgets
Almost Everyone's Guide to Economics
John Kenneth Galbraith, Nicole Salinger
Bantam Books 1978 Page 92
If there is idle capacity and unemployment, the government must spend more that it receives in taxes.........there is no merit at all in a policy that just balances income and outgo, none whatever.
Fuddled with nonsense
John Maynard Keynes
"The Conservative belief that there is some law of nature which prevents men from being employed, that it is “rash” to employ men, and that it is financially ‘sound’ to maintain a tenth of the population in idleness for an indefinite period, is crazily improbable – the sort of thing which no man could believe who had not had his head fuddled with nonsense for years and years…".
Look after the unemployment
John Maynard Keynes - from a 1933 radio debate:
You will never balance the Budget through measures which reduce the national income. The Chancellor would simply be chasing his own tail – or cloven hoof! The only chance of balancing the Budget in the long run is to bring things back to normal, and so avoid the enormous Budget charges arising out of unemployment…Even if you take the Budget as your test, the criterion of whether the economy would be useful or not is the state of employment…I do not believe that measures which truly enrich the country will injure the public credit…It is the burden of unemployment and the decline in the national income which are upsetting the Budget. Look after the unemployment, and the Budget will look after itself.
If you can have full employment by killing Germans
Interview with Tony Benn in Mchael Moore's film Sicko:
And what democracy did
was to give the poor the vote.
And it moved power from the marketplace
to the polling station.
From the wallet to the ballot.
And what people said was very simple.
They said, "In the 1930s,
we had mass unemployment."
"But we don't have unemployment
during the war."
"If you can have full employment by killing Germans, why can't we have it by building hospitals, schools, recruiting nurses and
If you can find money to kill people,
you can find money to help people.
Congressman Ryan questions the Federal Reserve Chairman:
P. RYAN: Do you believe that personal retirement accounts can help us achieve solvency for the system and make those future retiree benefits more secure?
A. GREENSPAN: Well,I wouldn’t say that the pay-as-you-go benefits are insecure,in the sense that there’s nothing to prevent the federal government from creating as much money as it wants and paying it to somebody.The question is,how do you set up a system which assures that the real assets are created which those benefits are employed to purchase.