Thursday, October 9, 2008

Ireland: Unnecessary Economic Pessimism

According to yesterday's Irish Independent, the decline in the housing market is expected to result in total unemployment of 300,000 by next year. ("Number of jobless will hit 300,000 next year," Breda Heffernan, Anita Guidera and Ralph Riegel, 10/08/08.) If government policymakers and prime movers throughout the world — not just Ireland — don't wake up and start to behave responsibly with respect to fiscal and monetary policy, the gloom and doom brigade could very well be right.

While projections by economic and political experts continue to show a downward spiral, the irony is that it is all completely unnecessary. The fact is that, as John Maynard Keynes declared in 1936, in his "Concluding Notes" to his General Theory,
"The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist."
The irony in that? Keynes, now defunct, is the slave master of today's "practical men," especially those locked into the absolute dogma that the only way to form capital is for the rich to save, then invest, thereby creating jobs for the rest of us . . . thereby locking in a second dogma, that full employment, rather than full production, should be the goal of national economic policy.

In consequence, all the concern in Ireland is over the potential loss of jobs, rather than concentrated on devising ways to spur economic growth and thereby put people back to work naturally, instead of creating subsidized jobs and other artificial means of generating effective demand.

CESJ's Capital Homesteading proposal is custom made for the situation in Ireland . . . and the United States, Great Britain, Germany, France, Belgium, Andorra, Laos, and downtown Suva in Fiji - in short, anywhere in the world where Keynesian economics now reigns supreme. Capital Homesteading can be kick-started painlessly by deciding to go forward with the Homeowners' Equity Corporation, or "HEC," to solve the immediate problem in the financial sectors and establish a solid foundation for future economic restructuring along more sensible lines.

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