Yeh someone in a back pain group I'm in has MS and they seem to have had way more hassle than is remotely necessary or idk, nice?
It's only bad when you have to pay it back!
I can't "print" money whenever I like, because I don't have a central bank. Furthermore, I can't borrow colossal sums of money at preferential rates of interest.
My IOU's don't put bread on my table nor clothes on my back. Furthermore, my IOUs are worthless compared to those of the banks. For example, I cannot go into a supermarket and hand the checkout person an IOU, nor can I put an IOU into a self-service checkout machine. I am not a bank. I stand by my point that public finances and domestic finances are not analogous. Thatcher used this faulty reasoning to convince the public to accept cuts to pubic services.
Exactly, just as financialised capital/corporate investment/asset management dislike the notion of states operating without debt; they want to accumulate from their interest payments.
Yes and no. Fractional reserve lending has a money multiplier effect, which really does create money. The bank cannot cover all of its liabilities and is relying on its depositors not asking for their money back all at the same time as they don't have it. The bank does spend money it doesn't have in a sense as it lends out the deposits. That is 'spending' effectively.
My rent has gone up 10% the last two years, I appreciate its probably less than others have but this was wildly out versus previous changes.
Not if it's due to people becoming employed or people getting higher paid jobs so they don't need tax credits or housing benefit.
No we were cap in hand to the WorldBank and IMF in the 70's and it was them calling for the UK to reduce the size of the public sector. Thatcher obliged. Our IOUs weren't putting bread on the table and the £ would have dunk further if was wasn't for the Sultan of Brunei propping up the £, most likely as part of Brunei's move towards independence
Before Thatcher "obliged", Callaghan & Healy had been doing so for the best part of 3 years.
Plus North Sea oil coming on stream
The IMF loan wasn't actually used and was paid back in full in 1979.
Still, conflating public finances and domestic finances is a Thatcherite trick. The idea behind doing so is to convince the public that their interests are best served by cutting their own throats.
Which is ironic given that Thatcher initially subscribed to the provably wrong theory of monetarism and managed to wreck the economy with it within record time. Britain was temporarily in thrall to a bunch of ideological extremists pushing crazy ideas. Nothing to do with the IMF by that point.
It was Alan Walters, Thatcher's friend and adviser to Pinochet, who helped to introduce what we now call neoliberalism to Britain in 1981 when he became Thatcher's economic adviser to the dismay of Howe.
Cambridge economist Ha-Joon Chang is good, Economics: The User's Guide & 23 Things They Don't Tell You About Capitalism. A clear, short introduction.
A better model:
Transactions in Private Sector (PS): businesses and corporations, families and foundations, state and local governments, etc. add up to the GDP (gross domestic product).
The Federal Government (FG) Dollars are SPENT to pay for public goods –weather forecasting, bridge repairs, Medicare services, etc.—and payments like social security, unemployment aid and food stamps.
The diagram shows that the Dollars in the Federal Government (FG) pot are obtained via TAXES and “BORROWING” through which the FG obtains Dollars by “selling” Treasury Bonds to the Private Sector.
The diagram gives the clear impression that the Private Sector somehow creates the U.S. Dollars we all use. The PS pot Dollars had to come from somewhere, right?—but the diagram shows no source other than the PS pot itself. This appears to constrain the number of Dollars that Congress can allow to flow into the FG pot, and this, of course, constrains the amount and kind of public goods and services.
However, the Dollars that flow out of the FG pot to pay for public goods and services—either entitlement or discretionary spending—don’t just disappear into the right page margin after they are spent. They go somewhere. They are paid to somebody. And who might that be?
In fact—and when you think about it, it’s obvious—the Federal Government buys its public goods and services from the Private Sector. Aircraft carriers and submarines are built by Private Sector shipyards. Weather and GPS satellites are designed and built by private engineering laboratories. And while the space-launch facilities at NASA are a “public” enterprise, all the scientists and technicians who work there are private citizens.
