Blog 27 Ten Economic Myths - A Series
What makes the garden grow?
Water.
Yes, smart answer. How did you figure that out?
So what makes the economy grow?
Austerity, and Debt Reduction.
Sorry, dead WRONG! Even the International Monetary Fund has changed its tune on that one.
Think "water" and "flowers."
MONEY
NATIONAL ECONOMY
Substitute "Money" and "National Economy" for water and flowers.
Footnote: It would be best to use government-created non-debt money, rather than borrowed money, of course.
The next three or four blogs will be devoted to "The Big Story" in the December 2015 issue of New Internationalist. NI is a British journal, established in the 1970's, The journal's title has a renewed relevance in these days when globalizers are getting closer to supplanting the national states with a really, really big government, bigger than any nation, and too big to be democratically responsible.
The cover title of the article is 10 EconomicMyths that we need to junk.
Some Background
The greatest war in the world, as we write, is not the war between men and women, not the war between Russia (or China) and America, nor the war between Muslims and Christians*, but the war between global corporations and national states
However, safely bunkered between the productive corporations (the manufacturing, mining, agricultural and other "real-economy" corporations), on the one hand, and, on the other hand, the public economies of national states (taxing and spending mainly for societal necessities), there is a third always smiling but mighty player. Like a colossus, with one foot on either side of the battleground, supporting, for a price, both sides, stands the almost non-productive financial corporations, the banks.
Why are they able to do this? Because of their power of CREATING money to lend - to all parties. Ever noticed that it is not just national states that have large debilitating debts, but that most corporations have big debts on their books, too? And money goes where money is - from borrowers to lenders. Banks are the happy creators and lenders of almost all f the world's money,
So in this global war, it is important to distinguish THREE parties, each with a separate agenda: global corporations, national states, and banks.
Of course, behind the scenes - in a bunker built of corporate stock certificates, are the real rulers of the world, who own the corporations, including the banks. In the shorter term it matters not to them who wins or loses. They know that, no matter what, it is better to be a lender than a borrower, and that when times are tough, cash is king - and very useful for buying up fire sale assets.
Small print disclosure. Your CogsBlogger is a minor member of that class: does no useful work; lives on his rents. But maybe can see the way to a better construction of the world's economy.
So next blog will continue to look at New Internationalist's Myths to be junked.
*Footnote: Christians should read the Koran. They will be amazed to see how much they have in common with Muslims. Both were, remember, derived from Judaism - with just a dash of paganism.