Re: Much ado about nothing?

Some time back, Randy Wray said:

>Readers are urged to go to
>http://debtreview.treasury.gov.au/content/home.asp and then go to the
>submissions to become aware of this extremely crucial macro debate.

I did, and found this, in
http://debtreview.treasury.gov.au/content/subs/034.pdf
which is a submission by the Evatt Foundation, written by among others Frank
Stilwell. Frank was on the ASHE conference (I even bought his new book!).
But I don't believe he is on this list(?). Anyway, he talks about different
types of debt in this submission (emphasis through capital letters are by me):

>Personal debt
>......(snip).....
>
>Corporate debt
>.......(snip)....
>
>Public Debt
>
>The third debt item is government debt, and this is what is now in the
>spotlight. Peter Costello’s suggestion that it should be reduced to zero is
>the culmination of a decade of political rhetoric – and a corresponding
>practical commitment – to debt reduction. Public sector debt, by inference,
>is a burden on the nation. Indeed, it may be but, LIKE personal and
>corporate debt, whether public borrowing is wise or unwise depends on the
>purposes for which the debt is used. There is an added social dimension too
>because of the essentially collective character of governmental
>expenditures, whether financed by debt or otherwise. GOVERNMENTS CAN FINANCE
>THEIR EXPENDITURE EITHER BY TAXES OR BY BORROWING, and usually do so by a
>mixture of the two. The latter has more obvious logic when the form of
>expenditure involves capital investment, rather than spending on, say,
>social security payments. In other words, forms of expenditure which enhance
>the nation’s infrastructure, and from which future generations can benefit,
>are appropriately financed by public debt. That, at least, is the
>conventional wisdom which neoliberal ideology and practices challenge.
>
>Of course, government borrowing involves a cost – the interest payments on
>government bonds, for example. That is usually said to be the main reason
>for seeking debt reduction. But whether the interest constitutes a ‘burden’
>depends upon how it compares with the social benefits arising from the
>government spending. As in the case of the carpenter’s personal debt, the
>interest payments are not a net burden if the future income-generating
>capacity is enhanced.
>
>...(snip)....
>
>So, as with personal and corporate debt, there are complex arguments about
>the ‘good’ and ‘bad’ aspects of public borrowing. THE ALTERNATIVES ALWAYS
>NEED TO BE CONSIDERED. WOULD FINANCING PUBLIC INVESTMENT THROUGH HIGHER
>TAXES RATHER THAN DEBT BE A BETTER ALTERNATIVE? That option deserves serious
>consideration. However, it currently seems to have few supporters, as a
>result of the seemingly widespread belief that higher taxes are a political
>‘no-no’. BUT IF THAT OPTION IS ELIMINATED, REDUCED GOVERNMENT BORROWING
>MEANS LOWER CAPITAL EXPENDITURE. So the deterioration in public
>infrastructure – in the quality of ‘public goods’ in general – is a direct
>consequence of the commitment to debt reduction. Thus the ultimate ‘logic’
>of the neoliberal program is the hollowing out of the public sphere of the
>economy and society.
>........

John Nevile and Peter Kriesler started the thread "Much ado about nothing".
To John and Peter (and Tony A. and possibly others): Aren't Frank's views as
quoted above, *substantially* different (as opposed to using different ways
of saying the same thing-- thus "much ado about nothing") to those expressed
by Bill/Randy/Warren?

Cheers,

Trond Andresen

PS
Could someone close to Frank tell him about this discussion,
I hope he will join the list. (If he is here already and I overlooked him,
my apologies!)
Received on Wed Feb 12 15:33:57 2003