Likely not then. It might be a syntax issue. It reads as if the people feeding those on entitlements gets money in lieu.
Entitlements are crowding out savings
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Hygro
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I said "there's no constraints on financial savings". Then I explained that entitlement spending creates savings as measured financially.
Yeah, I got that! Actually, that's why I replied what I did.
How does financial savings matter, if the entitlements are consuming a greater portion of production?
Upthread, I mentioned looking at the best part of the argument. Greenspan is more talking 'household savings' when he's talking savings. That's where the paucity lies.
How does financial savings matter, if the entitlements are consuming a greater portion of production?
Upthread, I mentioned looking at the best part of the argument. Greenspan is more talking 'household savings' when he's talking savings. That's where the paucity lies.
Hygro
soundcloud.com/hygro/
Financial savings matter because that's what Greenspan is discussing. He's saying we need to have governments run surpluses to bank the money needed to pay for these entitlements in the future.
or, most absolutely charitably:
He's arguing that we always bounce to full employment immediately and therefore if we subtract government spending that gap will be filled with capital investment and we'll solve the problem. You know, as oppose to, we subtract government spending and then we just have an employment gap.
or, most absolutely charitably:
He's arguing that we always bounce to full employment immediately and therefore if we subtract government spending that gap will be filled with capital investment and we'll solve the problem. You know, as oppose to, we subtract government spending and then we just have an employment gap.
He comes at it from a different place than MMT groups, mind. His goal is to run surpluses so that the government may tax less. The goal is to have the government take less money out of the economy over time, which is merely the flipside of adding more in. It's like how people using stimulus cheques to pay off debt liberate money into the economy.
I think he's assuming that employment is nearly full, or within spitting distance of it. Remember that it's politically 'easier' to deficit spend when governments at least have the reputation of running surpluses.
But he's very much not wrong. We don't have enough household savings. Haven't for a long, long time. There's no way to increase wages (or taxes on wages) if the people holding the capital also hold the money and also hold the debt paper. And if the wage-earners are being taxed higher and higher, it's a cycle.
Entitlements were funded differently than the general budget. It was a combination of direct wealth transfer coupled with buying government bonds with the surplus.
I think he's assuming that employment is nearly full, or within spitting distance of it. Remember that it's politically 'easier' to deficit spend when governments at least have the reputation of running surpluses.
But he's very much not wrong. We don't have enough household savings. Haven't for a long, long time. There's no way to increase wages (or taxes on wages) if the people holding the capital also hold the money and also hold the debt paper. And if the wage-earners are being taxed higher and higher, it's a cycle.
Entitlements were funded differently than the general budget. It was a combination of direct wealth transfer coupled with buying government bonds with the surplus.
In order for there to be more household savings, people have to have higher incomes. In order for the government to have surpluses, it has to raise taxes. If you shrink the government, households have lower incomes.
Sorry I've not responded to that previous post of yours, Cutlass. Won't have enough time for a bit.
Just remember, that I acknowledge there are multiple tiers of who has savings in a society. It's not a simple case of "gov't = bad".
But just remember who's being taxed to pay the entitlements.
Just remember, that I acknowledge there are multiple tiers of who has savings in a society. It's not a simple case of "gov't = bad".
But just remember who's being taxed to pay the entitlements.
I know who's being taxed. I also know that for the past 35 years we've been on constant rounds of cutting this, that, and everything else. We've gotten $17trillion in added deficit out of it. And we've yet to have a single penny of all those tax cuts and deficits invested in new businesses.
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