On Wed, 5 Jan 2000 DANIEL.DAVIES at flemings.com wrote:
> I think I can actually get away with the much weaker
> Keynesian/monetarist conclusion that economic policy can *influence*
> the business cycle. All I really need is the proposition that a large
> monetary expansion financed by a large international transfer payment
> (default on debts) is sufficient to engineer a boom.
So are you saying that the reason the monetary expansion didn't lead to inflation is because it was completely financed by the default on debts? Because I thought what Doug was getting at when he said this expansionary monetary policy was politically sterilized by busting unions was that without such measures, an expansionary policy would have strengthened unions, who would have raised their real wages, which would have cut into profits and led to inflation. Or at least to overwhelming calls by the capitalist class to reverse policy.
If in fact the inflationary aspects could be entirely avoided by defaulting on debts, well then, that's a national economic policy a lot of countries could avail themselves of today.
Michael
__________________________________________________________________________ Michael Pollak................New York City..............mpollak at panix.com