Re: Latest Rant from Warren Mosler

william_b_ryan_at_hotmail.com
Date: 12/13/04 

Date: 13 Dec 2004 11:58:13 -0800

Referencing
http://www.mosler.org/docs/docs/liberal_agenda.htm

[Mosler] In fact, the first macro equation we learn -
and the one that the government accountants must
balance to or find their math error - is as follows:

Government Deficit = Non Government Surplus
----------------------------------

Hummel: Mosler has merely quoted a well-known identity in
macroeconomics.
---------------------------
-------------------------

Whether or not it is "well-known," it is not generally
accepted. You'll find it in some Keynesian inspired
analyses. You'll seldom find it in non-Keynesian
analyses. It is in fact utterly fallacious on several
counts. It is a cash-flow concept that ignores the
realities of double entry accounting. It is premised
on the assumption that government prints money and
spends it, and government spending is the only source
of money. Moreover, it is premised on the assumption
that the cash account is the tabulation of government
money held by the firm, and there is no other asset
held by the firm, and that "savings" is equivalent
to the balance in the cash account.

If we take "non-government surplus" to be profit as
it is defined in double entry accounting, this so-
called "identity" is complete nonsense.

The Mosler model is a welter of logical inconsistency
built on false premises.

If you examine it closely, you will see that it is
the argument for fascism, in that it is the rationale
for centralizing the power of finance in "government,"
from whose authority there is no appeal, with the
populace enslaved in the so-called "buffer stock."

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