Home > Greece > Germany 1919 — Greece 2015

Germany 1919 — Greece 2015

from Lars Syll

The Greeks tried to talk with the other finance ministers of EU. The negotiations broke down.

140906085As soon as it was admitted that it was in fact impossible to make Germany pay the expenses of both sides, and that the unloading of their liabilities upon the enemy was not practicable, the position of the Ministers of Finance of France and Italy became untenable. Thus a scientific consideration of Germany’s capacity to pay was from the outset out of court. The expectations which the exigencies of politics had made it necessary to raise were so very remote from the truth that a slight distortion of figures was no use, and it was necessary to ignore the facts entirely. The resulting unveracity was fundamental. On a basis of so much falsehood it became impossible to erect any constructive financial policy which was workable. For this reason amongst others, a magnanimous financial policy was essential.


And in Greece the people still have to pay the true costs of misguided austerity policies.


  1. blocke
    February 18, 2015 at 8:43 am

    Consequently, economists and politicians decided after WWII among the victorious allies that they would not make the same mistake after WWII that Keynes described in his famous tract and that governments made in their disastrous attempt to collect war reparations from the Germans in order to pay the American loans made to the allies during the First World War. Why this lesson has been forgotten by the people running the Euro zone is hard to fathom, except to attribute it to stupidity, ignorance, and greed, but the consequence is the same that Keynes pointed out, an economic policy that makes the European economy malfunction and prevents the unification of the continent along social democratic lines. We need leadership from the Germans not bookkeeping procedures. Germany is facing a historical challenge in its role as leaders of the euro bloc, and its failure to provide it is the real modern Greek Tragedy.

  2. davetaylor1
    February 18, 2015 at 9:04 am

    I do wonder if one of the strong instincts of the feminine personality, to defend their own family against all threats, though admirable in itself, is in the leadership of nations actually misplaced. Thatcher, with her close family of well-heeled sycophantic “friends”, was a disaster for the moral character of Britain. Is Mrs Merkel’s dominant position the disaster here, I wonder?

  3. February 18, 2015 at 10:36 am

    Merkel isn’t defending her family. She’s promoting the interests of her class. an activity which knows no gender.

    • Ack Nice
      February 18, 2015 at 1:36 pm

      “She’s promoting the interests of her class.”

      I do, really do, get what you mean by that, Steve McG.

      But – I think it’s vital for us all to become crystal clear that such a sentence, as written, is inaccurate/untrue/wildly incorrect. For care-fully thought-through reasons I think our very survival hinges on enough humans (before it’s too late) having the great, counter-intuitive epiphany that overfortunes are as bad for the overfortunated class as they are for the underpaid 99%. Because people will only stop the practice/custom/tradition of pursuing overfortunes when they re-cognize and internalize the truth that clawing your way to riches = clawing your way to self-inflicted miseries galore – now including extinction.

      No, she is certainly NOT promoting the interests of her class. It is in precisely NO one’s interest to have to live their lives on a desperate planet being roiled and boiled and spoiled by the bad idea to allow overpayunderpay. EVERYONE is a loser on a planet ruled by the terrible idea to use division of labor as an excuse to let pay range from a thousand dollars a second to a thousand dollars a lifetime. All-grab-for-all economics is pan-species fatal, is pan-geno-masochism. The devil take the hindmost = the devil takes ALL. ALL are in the same boat. Crests are soon troughs – no one sails on a pacific sea until pay justice – NO one is a winner with our legal theft pay injustice dystem reliably, predictably, perpetually furnishing ever-escalating crises, dangers, miseries, violence, looming catastrophe stalking rich and poor alike.

      There is just the one boat and we are all in it. Ultimately, separateness is an illusion. A RATIO is sinking us all, all rich and all poor alike! Injustice drives violence, violence is egalitarian, gets to everyone. History is little but a listing of the trials and tribulations of the richpowerful. Cesar and Ceausescu were murdered BECAUSE they were the richest most powerful, not in spite of the fact.

      Attacks (of 100s of sorts, coming from everyone from complete strangers to closest family) are proportional to wealth – the relentless attacks on overfortunes means defending an overfortune requires eroding it to defend it. This is the ultimate lesson of history – the middle class and the poor of Ceasar’s Rome were not assassinated. An ivory tower is a CAGE. The rich are children hiding themselves away alone in a cupboard with the cake they stole, blind to their self-punishment! Overpayunderpay is a lose-lose plan for ALL FALL DOWN.

      This is no minor point I am making! Where oh where is the economics book that makes this crucial, vital, essential, fundamental point?!

      • February 18, 2015 at 2:10 pm

        Write on Ack Nice. How can it be that I have not already memorized your name and eloquence? Economists who play with mathematical models are propagandists for ALL FALL DOWN. Words and logic are entirely sufficient to reveal the crimes of plunderers addicted to more at any cost. All other economic theories are bogus idiocy.

      • davetaylor1
        February 18, 2015 at 6:16 pm

        “Write on Ack Nice.” Absolutely! Refreshingly direct. But Steve and Garrett are just blame-throwing again whereas I was trying to offer Blocke an explanation. Why is Mrs Merkel promoting (or as Ack seems to agree, defending) the interests of her extended family or class (call it what you will)? If Steve doesn’t like honest observations about one gender’s tendency to project family instincts onto class (or clan, given the upper class’e tendency to intermarry, which might be another reason for their insanity!) perhaps he might consider the “second-order” tendencies of men wanting to impress their women, and of women aping macho men when trying to get on in a male-dominated world . We are talking here about the playing out of gender-differing emotions, not rigid cause and effect.

        Says Ack: “I think our very survival hinges on enough humans (before it’s too late) having the great, counter-intuitive epiphany that overfortunes are as bad for the overfortunated class as they are for the underpaid 99%”.

        Absolutely: that is what I’ve been saying here and acting on for years. The truth is that money is debt, so the more you have, the more you owe. But Garrett, if it still seems counter-intuitive to you that there are branches of mathematics other than the quantitative ones now used by economists, and very simple distributional things one cannot say in words and the familiar logic of cause and effect or parts and wholes, you need to start listening to mathematicians and logicians, not economists. The crimes have been revealed; Ack’s point is, how do you make the criminals see the error of their ways? If they only think in terms of mathematical models and intuit nothing of the real world, then surely one must present them with irrefutably mathematical models which have the effect of showing them where they haven’t looked, not a simplistic generalisation of what a con-man asserted over a couple of hundred years ago. That is not propaganda for “all fall down”.

  4. February 18, 2015 at 11:03 am

    They they defend their class, which know NO borders. All people are peripheral to the ‘elite’ everywhere. Education/Erasumus/Trust Funds? Patents and Monopolies/Trade Agreements and annihilation of the state, everywhere.

  5. Ack Nice
    February 18, 2015 at 9:25 pm

    Hi Garrett. Thanks for kind, encouraging words and your reply – (and hey thanks to you, too, Dave, and others I’ve missed thanking in past for same – forgive my bad, please – I run out of time is all).

    With or without economists either leading the way or being dragged along behind kicking and screaming, the human species simply MUST unlearn what isn’t true in economics if we’re going to save our bacon.

    Again, starting with: it isn’t true that being superrich is a win for the superrich class, it is actually great loss of natural happiness, great loss of quality of life, great loss as compared to the ginormous dividends everyone would reap with investment in the fairpay justice system. What I said above is just the tip of the iceberg of further rational argument that proves the point.

    And it isn’t true that the pool of wealth is not finite – no matter how many university econ departments teach that fundamental misconception. There is no magic genie raining infinite wealth on us – the pool of wealth is finite – overpay has nowhere to come from but from underpay.

    And – doesn’t matter whether it’s coming out the mouth of Polanyi or of that ghastly Peter G. Petersen – it is not true that having a “wages differential” is necessary or right. It is neither. It is only rationalizations behind the world’s dumbest idea – if people would just stop, look, think, see. That Polanyi guy – even he said it without giving one reason why – he just assumes – and then people just assume he’s correct without questioning it. The truth is, provided we pay students for the work they do studying what society wants studied, there ARE no *reasons* to allow pay to range more than 2 to 1 – the maximum that sacrifice to work ranges. Limited personal fortunes is the natural order – we aren’t carrying out the natural order we are killing ourselves DEFYING it! It is just failure to think with care – and an inherited poverty of horizons – a dire lack of imagination – unwillingness to be realistic – that makes wage differential seem natural/fair/right/necessary!

    We don’t create ourselves. We don’t sacrifice anything to get born better-gifted. Nobody who won lesser-giftedness in the birth lottery chose that for themselves. What we do or don’t get to work with to make our way thru life is not up to us – what is in our control is how much time we choose to sacrifice to working. Forcing underpay on lesser-gifted people is nothing but punishing them for things beyond their control. We don’t get born equally gifted, we get born with equal needs. We have no say in the matter of gifts. Our equal rights derive from the fact we are born equally needing a place to put our feet while we live – land – we are born equally needful to have shelter, clothing, nutritious food, clean water, medicine or treatment when sick or injured, education, dignity, etc. There isn’t one shred of logic in saying “he deserves higher pay because he’s smarter”. The argument is as imbecile as me saying “Hey I got a gift for my birthday so now the rest of you have to pay me for having got a gift – fork it over!” Absurd!

    We pay the daycare worker very little – is that because she is not working responsibly? How does your kid come home from daycare alive if caregivers are working less responsibly than a CEO? It isn’t even true that the guy at the top of the ladder is working more responsibly than those below him in pay – but even if he WAS, what is it about his working responsibly using his gifts that requires the rest of us to make ourselves poor overcompensating him for working responsibly? Is he some superhuman who works at lightspeed, dictates to a hundred secretaries at once, needing a thousand times the food or alcohol to replenish his energies?

    And why do we feel we have to pay the rich businessman for taking risks (which he is absolutely trying his damndest to avoid anyway!)? If we must compensate him for risktaking, where is his risk? Did we ever feel we must heap overpay on the little girl risking her life filling a coal wagon in the coalmine? No. Conventionality is mostly insanity.

    People have been trained – indoctrinated from birth – to want to give a guy more pay simply because what he produces in his workday SELLS for more than some other good or service sells for – no thought whatsoever is given to the fact that both producers worked the same number of hours using whatever gifts they got to provide what they worked to provide! We seriously act like everybody who isn’t brainy enough to be a lawyer or doctor or economist (or brawny enough to play a mean game of sports) (or beautiful enough to be a supermodel) …is a failure to rise – they lack ambition or they’d be rich – and yet everybody can imagine what a world of nothing but lawyers and doctors and economists (etc) would look like. What the hell is less important about the garbage hauler’s job or the toilet scrubber’s job – or the job of raising the next generation?! The brainiest surgeon on the planet will kill you if she operates in an unsanitary surgery room! A Brian Williams, Tiger Woods, Paul McCartney, Bill Gates or Jamie Dimon rakes a bundle stacked to the stratosphere with our blessing – but I guarantee which one you’ll miss more in a short time if any one of them, and the garbage hauler, both disappear overnight!

    Nobody even denies that the worst jobs pay the least in this mucked-up world. Not to mention the biggest pays of all are reserved for private heirs – the biggest pays are got for absolutely no work done – unless you call it work to inherit an overfortune.

    It just has not dawned on humans that what is correct and sensible is to be paying people for what they lose to working – time – the amount of reward rightfully equals the amount of time sacrificed because THAT is what is under our individual control. The only thing that justly entitles you to take from the pool of wealth is your having put in the amount of work equal to the amount of work you take out. Wealth is produced by human work in TIME, not just space. Money is a license to take workproducts from the pool of goods and services produced by human work.

    People have all grown up knowing nothing else but the old wrong way – they inherited the overpayunderpay dystem so they mis-think there is nothing else, they chronically default to “there is no other way, that’s just how it is and always has to be” – but they are so wrong – we are all so wrong. Nobody MEANS to be getting it so wrong – i think it would be wonderful to just blame mother nature for having cursed us with limited wits so we can move on from blaming ourselves to ridding our species of the lethal error stuck in every head.

    We are like fish in water, oblivious even to the concept of water – immersed in it, we can’t see it – our error is so THERE we can’t realize it’s there – who is there left to see the vice that everyone has? We have no contrast – nothing to compare to – so the barking mass of error built on fundamental misconceptions of what it is right to pay people for – and not for – just grows, the unjust maldistribution of material wealth burning down our only house!

    We humans have neither time nor right to go on seeking consensus agreement on answers to all the wrong questions. It is stupid and exhausting and futile to go on attacking a million horrible consequences of keeping intact the root cause of suffering. We leave the root alone, undisturbed – and wonder why the suffering continues and escalates no matter which consequences we attack. Pay justice is NOT “just another issue” – it is the Mother of all issues – it is the issue all the other issues spring from.

    How is it not obvious to EVERYONE that you don’t defend your family by erecting a master-slave system/situation that features a gaping maw of poverty under everyone, that every family can fall into no matter how much time they sacrifice to working? How is it not obvious that (taking inequality of pay to its logical conclusion) you don’t get the most work done by giving all the incentive to one worker? Why don’t people see that it is clearly self-contradictory to say if we don’t pile more wealth on the overpaid they’ll stop working but if we DO give more wealth to the underpaid then THEY will stop working? How is it possible the human species can have come so far only to see so little – to see next to nothing? How is it we 99% have so little self-respect we will beg for a bit higher minimum wage and never even go near going after getting all our rightful earnings back from the legal thieves? Why is ‘minimum wage’ part of everybody’s vocabulary while so precious few speak of maximum wage? Why are we not keen to put a full stop to people having the kind of wealthpower that enables them to keep manufacturing new legal thefts faster than we can get rid of the current ones?

    A just cap on personal fortunes was always an option we humans could have selected – now it is essential for our chance to have a future at all – not optional.

    I think our simple-mindedness about work and wealth has caused us to do so much harm to ourselves that the human species has fallen far out of love with itself. We humans don’t love ourselves with any intelligence any more. We have forgotten the very purpose of life is to be happy… and that justice is a virtue without which there is no peace, safety, happiness for us. If we don’t soon fall out of love with the crazy idea to have everybody going for getting any amount they can manage to grab from the finite pool of pooled wealth/workproducts – and make the switch to loving having everybody go for withdrawing the amount of work they contributed, no more and no less – this poor species is toast. Burnt to a crisp. No butter, no raspberry jam.

    What if I’m right? What if I am indeed correct about overpayunderpay, and about fairpay justice? Does it matter whether or not we humans get our priorities and our focus correct? What are the consequences if we don’t?

    Will people, economists or not, just go on quietly ignoring the need to define and have pay justice, telling themselves the possibility that I’m getting my thinking correct … does not exist? Bet the planet and everybody’s everything the little wordy housewife is wrong without ever checking it out, thinking it through for yourself? Is that a good happiness plan, a good survival plan for your life? Is it true or false that the worst can’t happen just because it hasn’t happened yet?


  6. davetaylor1
    February 19, 2015 at 3:43 pm

    Ack, so much of what you say is so true and brilliantly expressed; but let’s go back to the Keynes quote:

    “The expectations which the exigencies of politics had made it necessary to raise were so very remote from the truth that a slight distortion of figures was no use, and it was necessary to ignore the facts entirely. The resulting unveracity was fundamental. On a basis of so much falsehood it became impossible to erect any constructive financial policy which was workable. For this reason amongst others, a magnanimous financial policy was essential”.

    Magnanimity is not about justice, it is about generosity. The purpose of life is not about being happy, it is about doing what makes people happy, which is being generous: and grateful when you are on the receiving end.

    You say: “Pay justice is NOT “just another issue” – it is the Mother of all issues – it is the issue all the other issues spring from.” I disagree, so let me try to answer your question:
    “Why are we not keen to put a full stop to people having the kind of wealthpower that enables them to keep manufacturing new legal thefts faster than we can get rid of the current ones?”

    i. The system of “pay” is an unnecessary outcome of the exigencies of politics pursuing justice rather than generosity, and lawyers thinking in terms of enforcing commands rather than commending generosity and penalising only blatant ingratitude.

    ii. The exigencies of politics arise from “he who pays the piper calling the tune”.

    iii. So how did the piper get his money? (As Keynes politely puts it, “The resulting unveracity was fundamental”). He obtained it by fraud, or theft, or being taken in as a child by “fool’s gold” and taking advantage of other people still being fools too.

    iv. He claims he has gold, and fools believe him, valuing him by his “wealth” and themelves by their lack of it.

    v. In short, the way out of this is to grow up and accept the truth. Money is now not even gold, which at least looks good. The way it is now created, it is an IOU, which when generously accepted generates debt, GIVING us “something for nothing” which we repay by DOING “something for nothing” (for the “pay we receive is merely our employer’s IOUs). The order in which these happen matters; the quantities merely have to be sufficient.

    This is like “hitch-hiking”: you can’t repay the guy who gave you a lift, but you can keep the system going by giving lifts yourself – short or long – when you become able and while you are able. Just as reserve banking was invented to provide credit while creating new forms of wealth, so were credit cards invented to give credit when needed, paid back in future as and when needed. If we go for the latter we don’t need the former, nor the private, corporate and state forms of taxation, the insurance, capital gains, care and tuition fees, pensions, advertising and security costs etc that have for so long gone with it. Instead we will need education in trustworthiness and rewarding real rather than promised achievement.

  7. shivz
    February 19, 2015 at 4:55 pm

    No even one dissenting voice there? Not a word about the lose, if not demagogic, comparison between 1919 Germany and 2015 Greece?

    • davetaylor1
      February 19, 2015 at 11:42 pm

      No. The comparison is not between 1919 Germany and 2015: that’s context. It is between the attitude of mind of two sets of political wimps, both afraid of losing face. I notice you haven’t subscribed to the scholar’s appeal for Greece, Shivz. I wonder why?

      • shivz
        February 20, 2015 at 9:12 am

        1. I am not a ‘scholar’, not even a politician. Just an ordinary person.
        2. 1919-2015: To my mind, Keynes was perfectly right then, on pure practical, political and economic, grounds.
        The present Greek tragedy can be grasped in a nutshell here: “…one of the lowest-ranked systems in Europe [the Greek public-school system], it nonetheless employs four times as many teachers per pupil as the highest-ranked, Finland’s. Greeks who send their children to public schools simply assume that they will need to hire private tutors to make sure they actually learn something” (Michael Lewis, Boomerang: Travels in the New Third World, 2011,p. 45, Kindle Edition).
        I would discard the use of the word ‘context’, in any imaginable context, in reference to 1919 and 2015.
        3. In your ‘appeal for Greece’ you say that “These debts are unsustainable and so will not be paid in any event”. That’s right. Moreover, assume that, as recommended, they are written-off, but, then, what you call (somewhat euphemistically) “a fresh start for Greece” means fresh loans, or even grants, if you will. Now, will you (or someone you trust – not wimps, of course) tell, or ‘guide’, the Greeks how to spend the new money, or leave it to their electorate?
        If asked, my attitude to the appeal would depend on the answer to that question.

      • davetaylor1
        February 20, 2015 at 11:16 am

        1. Nor am I a ‘scholar’: I didn’t have to be to support their appeal on behalf of the ordinary people of Greece. But I AM biassed. Given poor travel advice after over-zealous surgery in a British hospital, my life was saved in a Greek hospital so primitive that families had to do most of the nursing, and my not having a family to hand, one kind old girl nursed me too. Their doctor made effective use of (by our standards) extremely primitive equipment, not “profits”. Anyone who wants to blame decent Greek people for their corrupt government should try applying that to the USA and UK.

        2. I appreciate your scholarly reference to Michael Lewis: it seems (from Amazon) ABC’s favourite American economist. Huh! My favourite is Schumacher’s “Small is Beautiful” with its theme of “adequacy”. Sensible people are more concerned about community and making the best of enough rather than the straight-jacket of a few military-trained minds regimenting them into unnecessary efficiency in making money.

        3. As I and others are suggesting, “a fresh start” almost certainly means some form of multiple currency, so insofar as the euro isn’t available one can still trade locally with a local one. But even that is within the context of a “fresh start” with post-1740 economic theory and practice, for the reasons I’ve outlined above at i-v plus the looming environmental catastrophe threatening ignorant city dwellers just as much as food producers if we go on raping and polluting our world the way we are.

        Apologies for the strength of this reaction – as you can see I feel passionately about it – for I do hope understanding better the multiple-currency (or better, credit-card) option will encourage you to join the scholar’s appeal.

      • davetaylor1
        February 20, 2015 at 11:28 am

        PS. I’ve just been sent this, which is very much to the point:


  8. shivz
    February 20, 2015 at 11:39 am

    “Pollution”?…. “militarism”?…. “money making”?…
    Do me a favour and tell me what Greece should do after all her debts are written-off and no new loans (in Euros, Dollars, Yens, Kroner, Sterling, etc.) would be forthcoming.
    (Methodically, I know the technique: instead of referring to what Michael Lewis says, e.g., 4 times more teachers in Greece, you tell me who he is).

    • shivz
      February 20, 2015 at 4:05 pm

      My P.S. (re http://www.theguardian.com/commentisfree/2014/mar/18/truth-money-iou-bank-of-england-austerity): see Schumpeter’s 1934 ‘abnormal credit’.

    • davetaylor1
      February 20, 2015 at 7:55 pm

      Yes. http://link.springer.com/chapter/10.1007/978-0-387-98169-7_9#page-1.

      So Schumpeter is saying investment credit is abnormal because it will be repaid from future rather than current income, whereas it is now becoming clear the credit is not given by the bank which authorises it but by the people who, as a community, accept the bank-created IOUs as they are gradually spent by the entrepreneur on what already exists and which they near-continuously regenerate, e.g. the ability of workers to work and of suppliers to supply. When the necessary goods have been supplied and the workers have done their job, the IOU’s spent have done their job and the project, if still not “making money”, has become more nearly realised. When the project is up and running the entrepreneur entrusted with the IOUs necessary for himself and his project has done and been paid for his job, but truly, it is for the community (not himself) to reward him handsomely if it is in the public interest (or not if not).

      “In other words”, Graeber points out in the Guardian article, “everything we know is not just wrong – it’s backwards. When banks make loans, they create money. This is because money is really just an IOU”.

      Perhaps we haven’t been wrong: just backwards, like seeing confusion in a photographic negative before we could see the picture clearly in a positive print. One does not blame Schumpeter for seeing the economy going round the banks any more than one blames Ptolemy for seeing the sun go round the earth. That’s the way it’s been made to look.

      • shivz
        February 21, 2015 at 8:45 am

        I am glad you associate income with production – that is, if I understood you correctly. Thus, to be precise, Schumpeter’s abnormal investment credit is supposed to be repaid from future PRODUCTION. But, on the other hand, after noting that “no goods and certainly no new goods correspond to the newly created purchasing power”, he is very specific in asserting that “room for it is squeezed out at the cost of previously existing purchasing power” (i.e., current production, IOU’s notwithstanding).
        To my mind, Schumpeter’s economy is far from going around the banks. If anything, it is the exact opposite.
        The question, though, is what we mean by ‘production’, or rather, INCOME CREATING PRODUCTION. Schumpeter, for one, meant, at least by implication, goods production (recall the Greek teachers…), but this is too big for this platform.

  9. blocke
    February 20, 2015 at 8:44 pm

    shivz writes “Do me a favour and tell me what Greece should do after all her debts are written-off and no new loans (in Euros, Dollars, Yens, Kroner, Sterling, etc.) would be forthcoming.

    Greeks should pay their taxes and eliminate corruption, which we are told is rife in Greece (and in many other countries in the world). Do I believe that Greeks are less moral than other people in their private lives, no. But I do believe that Greeks, like people in hundreds of other countries, suffer from a widespread moral disorder in the public domain (payment of taxes, corruption of public officials, etc.) and that once the loans are written off, the ability of Greece to thrive economically will depend on the moral order in the public domain. How, shivz, do we establish a moral order in the public domain. Go back and read Montesquieu’s Spirit of the Laws.

    • shivz
      February 21, 2015 at 10:07 am

      [After yesterday’s agreement, this exchange will most probably take place in 4 months time] You say that “once the loans are written off, the ability of Greece to thrive economically will depend on the moral order in the public domain”.
      When the Greek problem first surfaced, I composed a simple mental exercise: defer Greek debt payments for, say, three-five years, and see if and how they can manage to maintain their socio-political system under balanced trade conditions.
      The answer was obvious, partly because of what you call ‘moral order’, but largely because of the time required for implementing the reforms which were universally deemed to be of the essence. Economically it meant, by definition (that is, if you want to help Greece), more funding, call it new foreign credit, aid, grants, IOU’s – anything with which imports could be paid with during the adaptation period.
      Therefore, I would repeat my initial question to Dave, which undoubtedly will be asked again four months hence: “Will you (or someone you trust – not wimps, of course) tell, or ‘guide’, the Greeks how to spend the new money, or leave it to their electorate?”
      P.S. – Thank you for sending me back to Montesquieu’s Spirit of the Laws. Hopefully, the answer to my question could be found there…

  10. davetaylor1
    February 21, 2015 at 11:58 am

    I interpret Schumpeter as associating income with SALEABLE production and repaying the banks for the NOMINAL value of their IOU’s, not their real value (virtually nothing). This is what I mean by his still seeing the system in monetary terms: as revolving around the banks rather than around communities consuming and regenerating goods (which include their well-being, human and technological capabilities).

    From what you say about “production being squeezed out”, Schumpeter doesn’t seem to be seeing the significance of slack in the system either: of stocks of goods and under-utilized resources; nor of banks demanding repayment of as well as accounting for IOUs which are already returned to them via purchases and pay-cheques and in practice simply reprinted as needed; to say nothing of banks wasting their ill-gotten gains on vanity projects.

    The whole issue of monetary pay vs monetary profit may look too big for this platform, but it would disappear in an honest credit card economy in which till roles etc already account not only for monetary income use but also for what has been acquired and so is likely to need regenerating. Information technology has moved on a bit since 1934.

    “Will you (or someone you trust – not wimps, of course) tell, or ‘guide’, the Greeks how to spend the new money, or leave it to their electorate?”

    Shivz, the whole point is that monetary debt is not real. The real debt is what you use that you are not able to reproduce, which can only be repaid in what you CAN produce (which in the case of Greece might be primarily memorable holidays)! So my advice is to use local [credit card] money for what you can produce internally, live as much as possible within those means, and make traders responsible for maintaining their own balance of payments for goods bought in other currencies. For local services the same principle can and should be localised even further.

    • shivz
      February 21, 2015 at 3:35 pm

      Let’s leave Schumpeter, Production, Income and Debt out and bring Greece in.
      Practically, what you are suggesting is (to my understanding) this: 1. All debts are written-off. 2. Greece is left to her own devices, assuming that for quite a number of years no more debt will be issued by its government (for which, anyway, there will be no takers).
      This is more or less like the well known/discussed option of defaulting, leaving the Euro and reinstating the Drachma.
      Here, I most humbly “join the crowd”, namely, opining that the austerity prescribed by the Troika is a Garden of Eden compared to a self imposed one.
      Will it be the end of Greece, or its economy? definitely not, but what about the suffering, deprivation, and ultimately, the political system?
      I am most anxious to see what your co-signatories of the Appeal are thinking about your advice.
      Best regards!

      • davetaylor1
        February 21, 2015 at 6:53 pm

        I too would be most interested to see what my co-signaturies think about my advice, and your interpretation of it.

        What I am suggesting is that one tells the truth about debt, and lives intelligently and honestly with the consequences. With the help of a little non-American trade, Cubans survived fifty years of abuse from the United States with much more justified dignity, self-respect, guaranteed sufficiency and (by sharing what they have, e.g. freely training medics for other impoverished countries) honour than many in the USA now have. The world thrives on generosity, not legalising theft.

  11. Ack Nice
    February 21, 2015 at 4:22 pm

    the purpose of life is to seek the purpose of life

    the purpose of life does exist, and it is wonderful, beautiful, perfect, brilliant, joyous

    the purpose of life is to pursue your own happiness ardently, totally, intensively, continuously

    this focus will bring everything into focus – it will give you an experience of the wonderfulness of life, it will make you feel fully alive, it will make you loving towards everyone, it will make you love life, it is the full experience of being divine and feeling divine, it is experience of the highest, it is fulfillment, it is meaning, it is perfect

    pursuit of happiness means asking yourself all the time: is this maximising my happiness? is this the best way i can spend my time? am i hurting myself somehow by some error i am making? are others seeing some way that i am hurting myself, and are not saying anything only because they do not know if i am open to hearing or trying to hear? what is it i want? doing what sort of things would make me happiest?

    this may seem selfish, but it isn’t – selfishness is pursuing your happiness with no regard for the reactions from other people to my actions – selfishness is not thinking about your own happiness enough! – if you think of your happiness fully, ardently, you will take into account the simple truth that hurting others will probably lead to others hurting you – it is by being ‘selfish’ enough to pursue our own happiness ardently that we are unselfish and think of others!

    a 100% ‘selfish’ person will never hurt anyone – will be as nice as anything to everyone – and the nastier the person, the more care they will take to be nice! – we are ourselves, and we therefore have a right – and a duty – to take care of ourselves, give ourselves the maximum happiness possible

    because the only real gift you can give others is a proof that if you seek happiness you will find it – pursuit of happiness is already full happiness – because you are sorted, you are in order, you are functioning as you are supposed to – other people see your happiness in pursuing your happiness and they see that that is the correct way to go – and that is the greatest gift you can give anyone – the one true gift

    if happiness is at some distance, it makes sense to go after it! – we only make sense when we pursue our own happiness totally – and making sense to ourselves is a happiness to us

    now, money satisfies all needs and most desires, so money is very very important in happiness – money is a joker good, a universal good, because it buys millions of goods, so money is as good as the things it can buy, which are all the good things

    happiness is everything, so true spirituality is part of pursuit of happiness – and pursuit of money is a very big part of pursuit of happiness – so pursuit of money is part of true spirituality – there is nothing unspiritual about working and getting a paycheck and spending the money

    but there is a distinction that has never been properly made, and that is between selfearned money and other-earned money – we all produce goods and services in our work, and we all specialise, so we have to pool our products of work, to get a mix of the things we want and need – this has made it possible for people to take out more than they put in, leaving others to take out less than they put in, which makes them mad, which leads to conflict and many unpleasantnesses

    we have one person taking out $1 billion for a fortnight’s work, and another person – equally a person – only able to get out $1 for a fortnight’s work – giant theft, giant anger – righteous anger – because his fortnight’s work is as big a sacrifice of his time and life as the other person’s and yet he gets a billionth as much out

    this is theft, and injustice, and leads to violence

    and it is here that money becomes bad, when it is other-earned

    it is love of other-earned money that is the root of almost all evils in our lives – love of getting out more than we put in by work – which is love of theft

    selfearned money is always good – and spiritual – and increases happiness

    other-earned money is always bad, because it comes with an angry person attached to it

    we humans, because of failure to pursue our own happiness ardently, totally, devotedly, dutifully, have got super hyper extreme theft, injustice, and we are not alive enough to notice where our suffering is coming from

    we have super hyper extreme theft, SO WE CAN BE SUPER HYPER EXTREMELY HAPPIER – if we can wake up to how we are hurting ourselves

    we can only wake up enough to see this, if we start pursuing our own happiness totally – then we will have a desire to understand how we are hurting ourselves, and we will be able to see it

    1% of people are getting 90% of world income – US$70 TRILLION a year – and doing less than 1% of the work – justice is equal pay for equal work – we have pay from $1 to $1 billion for equal work – the most extreme love of other-earned money, the root of all evils [because money is good for virtually everything good]

    we all think the pool of wealth, which has been filled by all the products of all the work, is a freeforall – just grab as much as you can, it is okay – in fact, the more you can grab, the better you are – but of course, taking out more than you put in, means others can take out less than they put in, and then they are angry – we have stolen from them, we have hurt them, and they will hurt us – it is not in our own interests to hurt anyone, and people who pursue their happiness ardently are very careful to avoid hurting anyone – especially to avoid hurting anyone in the case of money which is such an important part of happiness, since it is a universal good, good for almost all good things – including fairshare of power, freedom from slavery

    we humans have been totally careless about hurting others in the matter of money – and so we are hurting ourselves unnecessarily enormously –

    over 90% of world income is stolen and we don’t even grasp this, and its connection to the violence

    and yet, we all know what would happen if a government took 90% of income off 90% of people and gave it all to 1% – giant violence, enormous reduction of social happiness – 100-fold or 1000-fold reduction

    so why isn’t everyone focused on getting to justice in money, which will give us such an enormous, 100-fold or 1000-fold increase in happiness?

    we are not awake, because we are not 100% focused and concentrated on pursuit of our own happiness – we are not awake enough to see the most glaring facts, the most vital facts of our happiness

    we have an opportunity to be 100-fold happier, and we are missing it, blind to it, ignorant of it, unaware of it – not putting 2 and 2 together

    if you don’t look for happiness with all your steam, you wont find it – but it is there, just waiting to be seen and grabbed

    if no one was getting other-earned money, everyone in the world would be on US$15 an hour including homemakers and students – every family working average hard would be getting US$75,000 a year – paradise and plenty for all – and peace – and a future, instead of racing towards ww3 and extinction

    what do we get by having this freeforall at the pool of social wealth? – 1% overpaid up to a million times average hourly pay, 99% underpaid down to a 1000th of world average hourly pay – giant violence – giant suffering, giant pain, escalating to extinction soon!

    and the benefits of overpay are very negative! – because increase of pleasure with overpay is very slight, and increase of danger is very great

    fairpay [US$15 an hour, US$75,000 a year] satisfies all needs and all major desires and millions of lesser desires – leaving very few, very small desires for overpay to satisfy

    whereas danger of overpay is like the danger of taking everyone’s wallet/pocketbook – having to run like hell and being alone and hunted [shakespeare’s richard the third, ceausescu, the plutocracy of france guillotined]

    so what do we gain by allowing unlimited overpay? – enormous misery for all! – negative benefit to the overpaid, negative benefit to the underpaid, and everyone shrouded in universal global war escalating to perpetual global snowstorm, a triple iceage, blocking out the sun forever with atomic smoke!

    which is good news, great news – because it means that if what we are doing is very bad, we can have a very good time, a very much better time, if we stop doing what we are doing – universal graballyoucan, universal error of loving other-earned money

    100 children, 1000 sweets, everyone grab from everyone: result: endless grabbing and re-grabbing, endless expenditure of effort to keep what you have, no play, no pleasure, no party, no friendship, no trust, no community, no peace, no kindness, no safety, no rest,

    100 kids, 1000 sweets, 10 sweets each, result: happy eating, peace, pleasure, safety, friendship, trust, kindness, party, community, rest

    just pass laws setting the maximum fortune at the most a person can add to the pool of wealth by his work [US$2 million, 2006, doubling every 12 years or so with global inflation of 6%] and spread the overfortunes around among every person on earth – electronically, fully, directly – immediate justice, immediate safety, peace, community, trust, pleasure, party, happy eating, a future

    since 99% are underpaid, there is a huge majority to go for it, even if all the 1% are mad enough to prefer big negative benefit and extinction to justice and 100-fold happiness

    the work is spread, so should also the money/power be spread

    and the message can be spread easily just by word of mouth – everyone in the world will hear of it in just 31 times the time to tell two people, if everyone tells two people

    and word of mouth is safest and furthest from the sabotage of the super over-powerful

    economics seems to have always been the pseudo-science to justify immorality

    in the middle ages it was thought wrong to profit from scarcity

    economics was built on the doubtful claim that greed would serve the community – a nonsense, in fact – how can the merchant’s aim to sell dear and buy cheap, to manipulate cost and price to maximise the difference, in order to grab the difference and call it profit and virtue and godly wealth, possibly help the community? the merchant extracting a private tax on the community’s need to trade products of job-specialisation

    a nonsense, but in this decadent phase of history, a virtue, a pillar of our principles – the merchant’s desire for trade is supposed to force him to do exactly what serves the community – provide products – but since it is clear that his intention is to give less than he gets [and not just a fairpay for his services, but any amount he can wangle by whatever puffing of the product and defrauding of the workers], how can this theft serve the community? – unless a community needs a thief

    it used to be understood that where there was profit there was loss, ie, if things are exchanged and their workvalues are x and x+y [as they cannot help but be], then one loses by y and the other gains by y – and maximisation of y is maximisation of an unfortunately unavoidable theft [because no one can know the exact value of the items, however friendly the participants may be in not wishing to defraud, or get more or less than they give]

    everywhere in economics one finds that the principles of economics are rogues’ principles, the principles of unprincipled men – no wonder trade was looked down on, if by trade was understood the defrauding of people, and the self-justification of the fraud – trade could be honest, if the trader took fairpay for his services, and ploughed back any incomings in excess of this in services and paybacks to his customers and suppliers, to prevent his accumulating what is not his by right of working and earning it

    it is the easiest thing for a merchant to sell for $11 something for which his total costs [including his fair pay for his services] are $10 – stealing or begging $1 – instead of saying, at the end of the year, and finding that after paying himself and employees and all costs, that he has money over: whoops, i have overcharged customers or underpaid workers, economics has taught the merchant to say in his self-deceptional greed, what a good boy am i, what a superior and very fine person i am, how holy and godly!

    economics seems to have been born to cater to this stage of humanity when it turns theft into the backbone of culture and virtue – when it is able to justify to itself the taking of profits from scarcity without a blush, and actually preen itself on its virtue and spit on the robbed workmen and customers

    if profit is defined as the difference between total outgoings [costs, including costs of work input by owners], and total incomings [prices] then profit is by definition theft – getting more than you give – the product contains x workvalue, and the price is x+y – making y the profit – in big firms, where the owners, managers etc get salaries as well as profits, it is clearer that profits are theft – in small businesses, the term profit is what the owners pay themselves for their work-input

    in any case, there is nothing in the system to prevent incomings from exceeding outgoings by any amount

    the true original purpose of trade is to swap goods, to mix products of specialisation in jobs, so everyone gets the mix of goods they need and want – therefore ideally the two items exchanged should be equal in workvalue – ie, they should contain equal amounts of sacrifice of time and energy – and in honesty, they should be of as equal value as practically determinable

    the protestant ‘virtue’ of profit is really a vice – simple fraud, theft, or beggary – but economics seems from its inception to have been a justification for the activity of dishonest greedy people – and it has become ‘virtue’ in these decadent times –

    conception of greed is so vague that it is possible to flaunt it as virtue or glory

    i can think of nowhere in economics where it admits that the unavoidable inequality of the two items exchanged is an unjust shift of value

    nowhere does economics [as far as i know] explore the implications of this inequity, equal to y, the difference in value, which over trillions of transactions must cause a bell curve of gain and loss – must in fact cause an endless drift of value from some to others – cause unjust wealth concentration – which causes the emergence of classes, of rulers and ruled, of lucky and unlucky, of increasingly powerful and increasingly powerless, of masters and slaves – even without outright plundering and conquering

    the rich get richer, etc – money makes money – the first thousand is harder to make than the second million – after the first million money multiplies like rabbits – the merchant buys cheap and sells dear – business is others people’s money – business is just selling for more than it cost you – all these admit the fraudulence of profit – but so few know or can be prevailed upon to admit its dishonesty and viciousness, its social destructiveness – so many are unable to penetrate its fraudulence – a nonprofit organisation without volunteers pays every working contributor – so what are profits? – obviously not earnings – profits beyond payment for owner work services are by definition theft, injustice, fraud – but who can see it?

    profits are legal theft – injustice, which destroys the state – but profiteers are beacons of light to this mad age – it doesn’t matter how much over maximum possible honest earnings profits are, they are only more highly praised the higher they are

  12. davetaylor1
    February 21, 2015 at 6:59 pm

    Ack, how can you pursue happiness if you don’t know what it is? I know what makes me happy and the the lack of it unhappy: mutual gratitude, however produced; i.e. it is a social rather than a personal thing, recognised after the event rather than as something to pursue. But you might try Edward de Bono’s “the Happiness Principle”. He finds it in doing good work.

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