How Quantitative Easing Could Work...........

[Luke Skywalker]

Very neat marxist analysis of the current crisis.

I've always thought the the great man was spot on in his analysis of capitalism systemic flaws (chronic over-production and shrinking wages for the producers which can only be remedied in the short/medium term by an unsustaible credit/asset boom).

Now that capitalism is truly globalised, this systemic crisis is in full flow.

Personally, I would favour the following two measures:

- Everyone is given a spending voucher (let's say a couple of grand), not redeemable against cash and with a limited validity. That would kick start retail spending !! (obviously retailers would redeem the vouchers against cash)

- All state benefits and pensions to be abolished and replaced by an income for life paid to everyone, irrespective of income.

This 'state minimum living income' would be set at a level deemed sufficient for 'basic living'.

This guaranteed income for life would greatly simplify the benefits system and massively reduce its cost whilst giving everyone a financial safety net for life.

This concept has been proposed and discussed by many people in recent years and, IMO, would make complete sense.

Any thoughts?

Your two proposed measures would simplify things tremendously. But at the cost of millions of public-sector "jobs".

The reason that Moron Gordon created so many non-jobs in the public sector (remember 'The Guardian' job page on Wednesays?) was because these people were so, oh! so easy, to control and tax and later use to give/with-hold benefits. PAYE.NI.WFTC.SL.MB.DA.ML. and the whole gamut of his give-with-one-hand-take-with-the-other fiscal plan.

Then, after you've taxed them as above....hey! they have to pay VAT, Council taxes, fines, TV licence, airport taxes etc. etc.

AND: Guess what? They also spend money in the economy...so you can tax that too!

Wealth creators are much too difficult to control when you can create millions and millions of sheeple who can (really) be fleeced.

Moron only really understands public-sector 'solutions'.

Don't forget, he's never had a real job in his entire life and he's no clue about how value is added or wealth created.

[aa3]

Very neat marxist analysis of the current crisis.

I've always thought the the great man was spot on in his analysis of capitalism systemic flaws (chronic over-production and shrinking wages for the producers which can only be remedied in the short/medium term by an unsustaible credit/asset boom).

Now that capitalism is truly globalised, this systemic crisis is in full flow.

Personally, I would favour the following two measures:

- Everyone is given a spending voucher (let's say a couple of grand), not redeemable against cash and with a limited validity. That would kick start retail spending !! (obviously retailers would redeem the vouchers against cash)

- All state benefits and pensions to be abolished and replaced by an income for life paid to everyone, irrespective of income.

This 'state minimum living income' would be set at a level deemed sufficient for 'basic living'.

This guaranteed income for life would greatly simplify the benefits system and massively reduce its cost whilst giving everyone a financial safety net for life.

This concept has been proposed and discussed by many people in recent years and, IMO, would make complete sense.

Any thoughts?

Yes I'm a libertarian by nature, but who has read Marx and Lenin. Like you I thought Marx's analysis of the problems of capitalism in the long run was very brilliant. And that his solutions were worse than the problem in many cases, although he did have some good ideas - eg, the state central bank. Which the founding fathers of the US also gave the power to issue money to the congress. The downside of some of their seize private property and companies is communist societies have just stagnated and been unable to enjoy the advancing technology of capitalist societies. At best they import the tech from those other countries. Its a good point about the global nature of capitalism now, its only been about 20 years since all humanity went capitalist.

I strongly agree with the state income for life. If you look at programs like welfare around the world about 2/3 to 3/4 of the program is always spent on administration. On the other hand Social Security in the United States, which everyone gets(once they are old enough), has overhead of less than 1% of the payments. Benefits that go to everyone are also far more popular(like public funded health services). Few are going to complain about welfare for the poor if they get the same amount.

I also like your time limited spending voucher, its a great way to spur consumption without having people save(although the money gets into the system and will allow producers to save). I had a similiar proposal for the US auto industry. Instead of bailing out the companies, while consumers still can't afford to buy a new car... bail out the consumers with 500$ vouchers sent to every man, woman and child in the country. With a 2 year time horizon on them. The cost in the USA would be 150 billion$. Now not everyone would use the vouchers, but you put no limit on how many vouchers can be used to purchase one car. So soon a market will spring up where citizens can trade the vouchers for cash. Maybe they would buy the 500$ vouchers for 400$. The other side of the trade would be new car buyers could buy the vouchers for say 420$ for a 500$ voucher. It would nto harm capitalism's Shumpeteriun strengths. As there would be no demands on the customers having to buy a certain make of car.

I'd like to see the guarunteed income across all the industrialized societies.. USA, UK, Canada, Aus, Japan, Korea, EU, maybe even China now. I suspect we'd see less pressure on the workforce supply too. Like some people deciding to only work 30 hours a week, instead of 40. Some people retiring a little earlier. Others deciding to pursue a more advanced degree. Which could help put some pricing pressure on wages.