Re: new thread: PKT and ecology

[Justin Sher <justin@xxxxxxxxxxx>]

On Thu, 22 Mar 2001, Bill Mitchell wrote:

> Stephen Block wrote:
>
> >  Some intriguing issues have been raised by environmentally-minded students
> >concerning the long-term viability of the Keynesian growth model given the
> >(from their point of view) apparently unsustainable nature of the planet as
> >we know it if current levels of consumption are maintained and/or increased.

> The goals of PK(macro)T should include:
>
> (a) full employment
> (b) price stability
> (c) environmental sustainability.
>

	I'm going to play "The Emporoer has No Clothes" for just a second.
The problem I have with Keynsianism is that it has nothing to do with
capital structure and only has to do with consumption.  Capital creates
wealth above a primitive subsitence level, Why is capital creation and
structure so ignored?  I asked my macro professor once, if there were to
be a great war in which 95% of the capital infrastructure of the earth
were destroyed -- along with all the good engineers -- but government
spending increased and the central bank lowered interest why would a
Keynsian theorist's model then predict that we would enjoy a great economy
compared with previous years when this would obviously not be the case?

	Is there a Keynsian theory of creation and development of capital
structure or does it only interest itself with money, credit, fiscal
policy and consumption?