The Doctrine of Inevitability

Max Sawicky sawicky at
Tue Sep 1 07:26:36 PDT 1998

>Oh, on the question at hand, does deflation only benefit bond holders?
>Can't it aid the centralization process as well--driving weaker capitals
>to the wall, allowing better positioned ones to pick them up for a song?

Two quick points:

This sounds plausible. Deflation associated with slow growth and low employment obviously benefits employers in general on the labor cost side.

In all cases, however, these seem to me to defy 'either/or' imperatives. Sure, somewhat more deflation or downward pressure on wages benefits broad constituencies of capital owners, but there is no obvious reason why a little less of this benefit must be a fundamental problem, particularly compared to the alternative of collapse.

On military spending, from an economic standpoint, there would seem to be little apparent difference between forced 'consumption' in the form of military spending and government policies in domestic spending. If the government can't force people to spend money by giving them some (apparently an issue in Japan), it can always build infrastructure, or even give money to impoverished nations that are compelled to import U.S. consumption goods.

Note for anyone who wants to watch the ticker, try:^DJI&d=t


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