Re: The argument

["Schulte-baeuminghaus" <schulte.baeuminghaus@xxxxxxxxx>]

 "But such a return is NOT likely to happen any time soon, because
it would be contrary to the interests of big corporations and especially
of their managing executives and these are the people who really make
all important decisions on such matters, even though behind the scenes."


Dear Paul,

This corporate role might have been crucial a few years ago - even one year
ago; but the party is over.
We are or are shortly, it seems, going to be confronted with a basically
different situation.
The US economy and, to a large extent, the world economy have been walking
on air for some time.
The "recovery" has not arrived.
The date for its arrival is constantly postponed.
Those who remember the 'thirties, remember that always "prosperity was just
around the corner."
Sadly, it was a long lane which had no turning.
The stock exchanges have been following a predictable course.
Are they now teetering on the edge of a precipice?
We don't know for certain; but the signs are there.

> The mentioned change in economic policies occurred because overambitious
> and unscrupulous politicians abused their power of public intervention
> in the economy; mainly in order to win elections. Such abuses
> discredited the system of "tax and spend" for the rest of the 20th
> century.

The change occurred because our leaders - political and economic - did not
understand the way and the extent to which postwar Keynesian policies had
changed the economy and the society. They applied policies from 1969 onwards
that were initially well-meaning enough but which made inflationary
pressures worse.
In some ways, those pressures have never ceased because the misguided
policies post-1969 have never been abandoned. The United States and
Australia, for example, still run trade deficits to bridge the gap between
demand and supply.
Rather than too much "public intervention in the economy" there has been,
for many years, much too little and what there has been, has been the wrong
sort of intervention. A casino world economy, dominated largely by
speculation and corruption - or at least doubtful ethical practices - has
been the result.

> For the same reasons it is very unlikely that the "Enron people" would
> support the investments Dr. Cumes is proposing.


The "Enron people," if  by those you mean those who had their hands most
deeply in the cookie jar, are history or shortly will be.
But the survivors will be much more amenable to proposals that will enable
them to continue to survive.
If VOW or anyone/anything else offers them a lifeline, they'll grab it.

> Because of the Enron scandal, the general public might have become aware
> of this unfortunate decision and therefore the time might be ripe to
> change it. We at VOW should support efforts to reform the pertinent
> legislation, even though chances for success are not good.

Major and probably fundamental change is now inevitable whether people like
it or not.
Events are likely to move too fast for most people to do anything but be
carried along by them.
Bush junior will probably turn out to be a sort of latter-day Hoover.
He was not or should not have been taken by surprise as Hoover was.
The bust was already well on the way by the time Bush took office.
Probably he does not have the qualities - or he has not shown them yet -
that Hoover had.
Those around him will probably be able to help him little in a situation
that he will probably find overwhelming.
Even Greenspan, who is not entirely without merit but with whom a high
proportion of the blame must lie, has been showing a great deal less
confidence in recent weeks.
If he can't keep on reducing interest rates - has he hit a lower limit
anyway? - what can he do?
Is he now destined to be no more than a helpless spectator?
VOW must not only attempt to "reform the pertinent legislation" - whatever
that might mean - it must try to remodel the whole system.
"Its chances of success are not good?"
They just have to be good.
If they're not and we fall over the precipice, we have a catastrophe ahead
of us, almost certainly an enduring catastrophe, perhaps an ultimate
catastrophe.




James Cumes
http://VictoryOverWant.org


----- Original Message -----
From: "Paul Riesz" <priesz@xxxxxx>
To: <schulte.baeuminghaus@xxxxxxxxx>
Cc: "Gelles John" <johng@xxxxxxxxxx>; "Imrich Jozef"
<chezimrich@xxxxxxxxxxx>; "VOW" <vow@xxxxxxxxxx>
Sent: Monday, June 10, 2002 5:52 AM
Subject: The argument


> Does VOW ask WHY?  Cumes claims that what we had for nearly twenty years
> after WW II is what we want.  WHY did we lose it? John,
>
> We lost it because we applied foolish economic policies from 1969
> onwards. All that VOW does is reverse those policies to get us back on
> track again.
> Encourage public and private investment, get productivity and production
> moving upwards, cut unemployment and get high participation rates
> through these policies, and you'll get all the revenues you want without
> inflation.
> We did it for a quarter of a century. I repeat that there's nothing
> mysterious about it. You don't have to be a Ph.D. in economics to
> understand it. In fact, you're better off if you haven't studied
> orthodox economics and haven't been misled by the wonder-boy economists
> of the last thirty years. All you need is some ability to observe and
> recall and to think clearly.
> James Cumes
>
> The mentioned change in economic policies occurred because overambitious
> and unscrupulous politicians abused their power of public intervention
> in the economy; mainly in order to win elections. Such abuses
> discredited the system of "tax and spend" for the rest of the 20th
> century.
>
> By now we have arrived at the opposite extreme, where GREED reigns
> supreme and regards for the wellbeing of the community are mostly
> neglected.
>
> A return to Keynesian policies would indeed solve many of our problems
> and more watchfulness by citizens might prevent the repetition of
> abuses. But such a return is NOT likely to happen any time soon, because
> it would be contrary to the interests of big corporations and especially
> of their managing executives and these are the people who really make
> all important decisions on such matters, even though behind the scenes.
>
> To prove that this is more than a mere suspicion, consider the many
> efforts to reform campaign contributions that failed or resulted in mere
> cosmetic changes, because real reforms would eliminate or severely
> diminish the power of these hidden decision makers.
>
> Because of the Enron scandal, the general public might have become aware
> of this unfortunate decision and therefore the time might be ripe to
> change it. We at VOW should support efforts to reform the pertinent
> legislation, even though chances for success are not good.
>
> Johns proposals for addressing these problems through the PUBLIC
> expansion of the supply of fiat money sound very convincing to me, but
> they would face an even more violent opposition from those who at
> present hold - and very much enjoy - a virtual monopoly on the creation
> of money and credit.
>
> For the same reasons it is very unlikely that the "Enron people" would
> support the investments Dr. Cumes is proposing.
>
> Regards         Paul
>
>
>