A Tired response

[pdavidso@xxxxxxxxxxxxxxxxxx]

Apparently what we have here is "a lack of Communication" as Cool hand
Luke said to his torturers. So my quick responses to my torturers.
To Gonzalo; At first I thought we were not communicating because we had
differing axioms. Your April 26 comments indicates we are talking
different languages-- where you persist in using English words to mean
things other than the dictionary.  The dictionary defines an axiom as "a
self-evident or universal truth; an undemonstrated proposition concerning
an undefined set of elements, properties, functions, and relationships".
Consequently when you claim that axioms can be derived from other axioms
you are talking gibberish. They are universal truths that are believed
and do not derive from other axioms.  Statements that can be derived from
(other) axioms, are logical conclusions or deductions --they are not
axioms!

Thus Gonzalo, when you say the "source of your disbelief lies in their
NOT being "fundamental" enough and not deductible from more fundamental
axioms", it is clear to me that the source of your "disbelief" is
your semantic gibberish (which the dictionary defines as
"Nonsensical rapid talk; prattle".
Assumptions -- unlike axioms are not "universal truth". It is merely a
"statement accepted as true or supposed true, a minor premise"  -- not a
major premise of universal truth.

To Barkley et al: regarding a general theory; Please see Jamie
Galbraith's article "Keynes, Einstein, and Scientific Revolution"
AMERICAN PROSPECT, Winter 1994 -- and lets not confuse the loading on of
ancillary conditions as "generality".

To Bill Mitchell: the higher K/L ratio permits more production per
worker. If the aggregate demand is there to buy the greater output (and
thereby generate greater profits) the "greedy" capitalists will willingly
hire all the workers that want to work.  Hire K/L ratios, limit
employment only when there is not sufficient demand to make it profitable
to work. As long as workers are willing to work at the going real wage,
dear Bill, involuntary unemployment exists not because
entrepreneurs enjoy throwing workers into the dustbin, but
only because they can not find enough market demand to employ all who are
willing to work.
Henry Ford may have been a scalawag capitalist and an utterly
reprehensible anti-Semite and isolationist, but he did understand that
if you paid high wages when demand was high, you created a continuing
market for mass production goods which is good for profits.  The
entrepreneurial system is not designed to intentionally create
unemployment although it can be subverted towards such goals by foolish
policies.  Still the evidence (empirical Bill) is that the entrepreneurial
system has raised the real standard of living over time compared to any
other system -- including a Centrally planned system. (I Know Bill,
socialism has never been tried here on earth.  but neither has heaven!)
Maybe if you had studied PKMT more -- instead of sending it back to the
publisher, you might agree with me on even more than the one point
regarding the essential elasticity properties of money and liquid assets.

Finally, I did not respond to your claim about a straight line describing
99 scatter points vs. a nonlinear curve-- having a better fit, because it
seems obvious that by better "fit", I mean a path that comes closer to the
observed points. Its nice to know that while everyone else is bombing me
for not accepting nonlinearity, Bill can show his individuality by bombing
me for not accepting linear systems.

To Ajit: How can a monetary economy analysis "Could be conducted in real
terms without recourse to money" as you claim?  Only if you have as an
axiom that money is neutral in both the short-run and the long-run. Then
money does not affect the real variables.  But if money is not neutral,
then as Keynes noted in his 1935 article "A Monetary Theory of
Production" money affects real outcomes and nothing can be said about the
real economy until one talks about money and its short-term and long-term
effects.  Sorry Ajit you are just accepting as a universal truth that
Money is always neutral.  No wonder you agree with Steve and Barkley,
they go to the same axiomatic church as you do. I go to a different
axiomatic church.  We can be friends but don't try to convert one or
another -- unless you think the other side will give up what they have
always believed is a universal truth.

A General theory permits both neutral and non-neutral money cases.

Also Ajit see -- my earlier comments to Bill on K/L ratios and
unemployment in an entrepreneurial economy.

Mark Nadler -- what's this instrumental content business?-)

to Ric Holt- monetary expansion need not lead to "a lowering of the
exchange rate" Ric. For example, see the rate of growth in the US money
supply between 1982 and 1985 (vis--a-vis) other nations and what happened
to the US exchange rate.  (only way to defend your contention is to use
the Milton Friedman dodge about long and variable lags.)

to John Gelles- John the ability to endogeneously create credit money to
meet the "needs of trade" has been a principle incorporated in most
central bank charters and theory. This real bills doctrine, however, is
honored more in the breach.  Schemes that are the Nineteenth century
equivalent of the "free silver" movement for creating "automatic"
(endogenous) credit is as likely to succeed as the bimetallism of the
19th century. You are going to end up crucifying the average
workingperson on a cross of YEN. And Marxian-type revolutions are not
going to change the problem.

The problem is to package a real bills
doctrine so that it looks like "monetary prudence".  That's what my IMCU
proposal was suppose to do. Secretary Rubin wants to deal with
fundamentals rather than pizzazz -- but he (and advisers such as Fred
Bergsten and Larry Summers don't have a clue as to what is fundamental
for a money-using global entrepreneurial economy.
 Roger Koppl - Please read my review of O'Driscoll and Rizzo's book "The
Economics of Time and Ignorance" entitled "the Economics of
Ignorance or Ignorant Economics" in CRITICAL REVIEW, Summer 1989.  I
specifically indicate why these authors are incorrect when they state on
page 9 (and you quote) "It is evident that there is much common ground
between post-Keynesian and Austrian subjectivism".
Although the Editor gave the Austrians the freedom to reply to my review
and some did, O'Dricoll and Rizzo never responded -- to the surprise of
even some Austrians.
Paul D.