Economic policy of the Barack Obama administration - Wikipedia
Corporate tax cuts are just the first step. But it's a microcosm of the GOP economic agenda, which has made regressive deficit-busting tax cuts the and slashed government spending on health care and anti-poverty programs. Rather, it is exquisitely designed to mollify a class of corporate-libertarian. The federal budget deficit grew 79% in July, the Treasury Profile Settings · Email & Alerts · Watchlist · Games. Share. Home · Economy & Politics For the first 10 months of fiscal , the shortfall totals $ billion, Corporate revenues were down 34% as companies enjoyed a reduced 21% tax rate. Milton Friedman was an American economist who received the Nobel Memorial Prize in . It was at Chicago that Friedman met his future wife, economist Rose Director. encountered antisemitism in the Economics department and decided to return to government service. .. They became known as the Chicago Boys.
Keynes's main interest had been in trying to prevent Germany's compensation payments being set so high it would traumatise innocent German people, damage the nation's ability to pay and sharply limit her ability to buy exports from other countries — thus hurting not just Germany's own economy but that of the wider world. Unfortunately for Keynes, conservative powers in the coalition that emerged from the coupon election were able to ensure that both Keynes himself and the Treasury were largely excluded from formal high-level talks concerning reparations.
Their place was taken by the Heavenly Twins — the judge Lord Sumner and the banker Lord Cunliffe whose nickname derived from the "astronomically" high war compensation they wanted to demand from Germany. Keynes was forced to try to exert influence mostly from behind the scenes. Lloyd George did however win some loyalty from Keynes with his actions at the Paris conference by intervening against the French to ensure the dispatch of much-needed food supplies to German civilians.
Clemenceau also pushed for substantial reparations, though not as high as those proposed by the British, while on security grounds, France argued for an even more severe settlement than Britain.
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Wilson initially favoured relatively lenient treatment of Germany — he feared too harsh conditions could foment the rise of extremism, and wanted Germany to be left sufficient capital to pay for imports.
To Keynes's dismay, Lloyd George and Clemenceau were able to pressure Wilson to agree to include pensions in the reparations bill. Towards the end of the conference, Keynes came up with a plan that he argued would not only help Germany and other impoverished central European powers but also be good for the world economy as a whole.
It involved the radical writing down of war debts, which would have had the possible effect of increasing international trade all round, but at the same time thrown the entire cost of European reconstruction on the United States.
Lloyd George agreed it might be acceptable to the British electorate. However, America was against the plan; the US was then the largest creditor, and by this time Wilson had started to believe in the merits of a harsh peace and thought that his country had already made excessive sacrifices.
Hence despite his best efforts, the end result of the conference was a treaty which disgusted Keynes both on moral and economic grounds, and led to his resignation from the Treasury. Keynes's analysis on the predicted damaging effects of the treaty appeared in the highly influential book, The Economic Consequences of the Peacepublished in In addition to economic analysis, the book contained pleas to the reader's sense of compassion: I cannot leave this subject as though its just treatment wholly depended either on our own pledges or on economic facts.
The policy of reducing Germany to servitude for a generation, of degrading the lives of millions of human beings, and of depriving a whole nation of happiness should be abhorrent and detestable, —abhorrent and detestable, even if it were possible, even if it enriched ourselves, even if it did not sow the decay of the whole civilised life of Europe.
Also present was striking imagery such as "year by year Germany must be kept impoverished and her children starved and crippled" along with bold predictions which were later justified by events: If we aim deliberately at the impoverishment of Central Europe, vengeance, I dare predict, will not limp.
Nothing can then delay for very long that final war between the forces of Reaction and the despairing convulsions of Revolution, before which the horrors of the late German war will fade into nothing. Keynes's followers assert that his predictions of disaster were borne out when the German economy suffered the hyperinflation ofand again by the collapse of the Weimar Republic and the outbreak of the Second World War.
However the historian Ruth Henig claims that "most historians of the Paris peace conference now take the view that, in economic terms, the treaty was not unduly harsh on Germany and that, while obligations and damages were inevitably much stressed in the debates at Paris to satisfy electors reading the daily newspapers, the intention was quietly to give Germany substantial help towards paying her bills, and to meet many of the German objections by amendments to the way the reparations schedule was in practice carried out".
In fact, the historian Stephen Schuker demonstrates in American 'Reparations' to Germany, —33, that the capital inflow from American loans substantially exceeded German outpayments so that, on a net basis, Germany received support equal to four times the amount of the post-Second World War Marshall Plan. Schuker also shows that, in the years after Versailles, Keynes became an informal reparations adviser to the German government, wrote one of the major German reparation notes, and actually supported the hyperinflation on political grounds.
Nevertheless, The Economic Consequences of the Peace gained Keynes international fame, even though it also caused him to be regarded as anti-establishment — it was not until after the outbreak of the Second World War that Keynes was offered a directorship of a major British Bank, or an acceptable offer to return to government with a formal job. However, Keynes was still able to influence government policy making through his network of contacts, his published works and by serving on government committees; this included attending high-level policy meetings as a consultant.
Keynes developed the first upper-lower probabilistic interval approach to probability in chapters 15 and 17 of this book, as well as having developed the first decision weight approach with his conventional coefficient of risk and weight, c, in chapter In addition to his academic work, the s saw Keynes active as a journalist selling his work internationally and working in London as a financial consultant.
In Keynes wrote an obituary for his former tutor Alfred Marshall which Joseph Schumpeter called "the most brilliant life of a man of science I have ever read.
Britain suffered from high unemployment through most of the s, leading Keynes to recommend the depreciation of sterling to boost jobs by making British exports more affordable. From he was also advocating a fiscal response, where the government could create jobs by spending on public works. Keynes advised it was no longer a net benefit for countries such as Britain to participate in the gold standardas it ran counter to the need for domestic policy autonomy.
It could force countries to pursue deflationary policies at exactly the time when expansionary measures were called for to address rising unemployment. The Treasury and Bank of England were still in favour of the gold standard and in they were able to convince the then Chancellor Winston Churchill to re-establish it, which had a depressing effect on British industry.
Keynes responded by writing The Economic Consequences of Mr. Churchill and continued to argue against the gold standard until Britain finally abandoned it in Keynes had begun a theoretical work to examine the relationship between unemployment, money and prices back in the s.
A central idea of the work was that if the amount of money being saved exceeds the amount being invested — which can happen if interest rates are too high — then unemployment will rise. This is in part a result of people not wanting to spend too high a proportion of what employers pay out, making it difficult, in aggregate, for employers to make a profit.
Another key theme of the book is the unreliability of financial indices for representing an accurate — or indeed meaningful — indication of general shifts in purchasing power of currencies over time.
In particular he criticised the justification of Britain's return to the gold standard in at pre-war valuation by reference to the wholesale price index. In it, individuals' private identification numbers were accessed and copied to a computer controlled by a "childhood friend" of Varoufakis.
The bailout bill received votes to 64 as the conservative opposition voted in favour. Up to 40 Syriza members including Varoufakis voted against the bailout.
On 20 August, the prime minister himself resigned and called a snap election due to the loss of support from rebelling Syriza MPs. At the same time, Syriza announced that any MP who voted against the bailout package would not be standing for the party.John Taylor on the Impact of the Economy on the Deficit
Varoufakis did not go on to represent Popular Unityunlike many of his ex-Syriza colleagues, as he considered the party too isolationist. Varoufakis choose not to stand in the election, saying he would focus on creating European network that would 'restor[e] democracy' in Europe. Combining with the Independent Greeks Partya majority was achieved and Tsipras was returned to power.
Varoufakis had proposed debt swap measures, including bonds pegged to economic growth, which would replace the existing bonds of the European bailout programme. He said that the UK should remain in the EU, but also campaign to democratise it: In AprilVaroufakis publicly supported the idea of a basic income.
He stated that he hoped the party would be based on an alliance of "people of the left and liberalism, greens and feminists".
Works[ edit ] Varoufakis is the author of several books on the European debt crisis, the financial imbalance in the world and game theory. He is also a recognised speaker and often appears as an analyst for national news media. A film is planned based on his book Adults in the Room directed by Costa-Gavras. Galbraith as a third co-author. This version was published in late in French with a supporting foreword by Michel Rocardformer Prime Minister of France. He argues that the global economy since the s can be viewed as being built around the financing of the twin deficits of the United States — its trade deficit and government deficit.
Varoufakis argues that the United States powered the global economy by consuming the exports of the rest of the world, and then the surpluses flowed back to the United States by going to institutions on Wall Street or being used to buy U.
He suggests the recycling back to the U. Although many Republican lawmakers tried to blame the housing bubble on Fannie Mae and Freddie Mac, Greenspan placed far more blame on Wall Street for bundling subprime mortgages into securities. In it he argued: Notable critics included J. Greenspan argued, "My view of the range of dispersion of outcomes has been shaken, but not my judgment that free competitive markets are by far the unrivaled way to organize economies".
Do we wish to retest the evidence? Several notable contributors in defense of Greenspan included Stephen S. RoachAllan Meltzerand Robert Brusca. Meanwhile, Greenspan recommended improving mark-to-market regulations to avoid having derivatives or other complex assets marked to a distressed or illiquid market during times of material adverse conditions seen during the late s credit crisis.
In a government report that was a key driver in the passage of the Commodity Futures Modernization Act of —legislation that clarified that most over-the-counter derivatives were outside the regulatory authority of any government agency—Greenspan was joined by Treasury Secretary Lawrence SummersSecurities and Exchange Commission Chairman Arthur Levittand Commodity Futures Trading Commission Chairman William Ranier in concluding that "under many circumstances, the trading of financial derivatives by eligible swap participants should be excluded from the CEA" Commodity Exchange Act.
Other government agencies also supported that view. I don't know how significant or permanent it is. But I have been very distressed by that fact.
Matt Taibbi described the Greenspan put and its bad consequences saying: As I've said before, I've always supported moves to full funding in the context of a private account". In that testimony, Greenspan had stated that growing worker insecurity is a significant factor keeping inflation and inflation expectation low, thereby promoting long-term investment.