On this week's Economic Update, Prof. Wolff provides updates on car companies buying ride-share companies, Pope's latest, evidence against Prof. Krugman's rosy view of inequality. Major discussions of (1) why markets need not undermine worker-coop based economy and (2) European leaders' failed policies on Greece.
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The problems with supply and demand when there is abundance is that scarcity has to be artificially “generated” in order for profits to be made and people wind up starving in the 3rd world and the disequilibrium leads to social chaos and war. One bad drought and you get the Arab Spring and then ISIS.
It gets fairly obscene with over consumption of meaningless crap and over development in the already developed northern countries and economic strangulation in southern countries.
There is so much over accumulation of money in the north that rich folks in Japan have to pay the banks to keep their money, i.e. negative interest rates, or it has to be offshored or “car washed” to keep it out of the normal economy to avoid taxation by the greedy billionaires and prevent inflation which lowers its value.
This president has been a bitter disappointment to me, and I voted for him twice. His failures include 1) rising inequality and the social destruction that goes with it 2) Too big to fail banks being even bigger today 3) a lack of urgency in global warming proposals 4) expanding the never-ending wars in the Middle East 5) sky-rocketing medical costs and substandard medical care for all but the wealthy 6) lobbying still very much alive and the
revolving door between corporations and government still spinning at a rapid pace. (Didn’t this president promise to close Washington to lobbyists when he came into office?)
Prof. Wolff says that markets are merely a means of distribution. I don’t disagree with that. However my understanding is that this term was merely a glammed-up word for those who buy. Markets = consumers, essentially. Either way, I do agree with the professor that ‘markets’ do not call the shots all the time, they are not nor should they ever be deified into absolution, as if it’s inherently some inflexible law of commerce. Companies create needs, or at least convince you of these needs, then satisfy them. Or, more cynically, they create problems then sell the solution. That’s not reactionary to ‘markets’ which is taught in business schools, it’s very proactive and more common than university business professors care to acknowledge.