Thursday, December 14, 2017

How Banks “Manufacture” Credit



Yesterday we posted the introduction to the chapter in which Dr. Harold G. Moulton demolished the Keynesian money multiplier, which ironically, despite the fact that it is based on an easily disproved fallacy, forms the basis of the monetary and fiscal policy of virtually every government on Earth.

Wednesday, December 13, 2017

Why the Money Multiplier Doesn’t Work, I: Introduction



Yesterday we posted a brief discussion of why the “classic” Keynesian money multiplier — on which virtually every government on Earth bases its monetary and fiscal policy — simply doesn’t work.  The Keynesian money multiplier, in fact, is based on an accounting fallacy and a complete misunderstanding of money, credit, finance, and (especially) banking.

Tuesday, December 12, 2017

That Banking Principle Again



Last week we got another comment on a posting of the kind that we like to get, i.e., that writes another blog posting for us.  This gets more bang for the buck by killing two birds with one stone, as long as we hit the nail on the head.  Which uses up our quota of aphorisms for the day.  So, let’s cut to the chase.  Our commentator said,

Monday, December 11, 2017

The Just Third Way Hour Podcast


We don't have a new Just Third Way Hour podcast for this week, but now is your chance to catch up on the ones you missed before you get too far behind.  You don't want to be taken by surprise or be unprepared when our new host, Dave Hamill, gets revved up and running:

Friday, December 8, 2017

News from the Network, Vol. 10, No. 49



Although things generally slow down during the “holiday season” (although when is there ever a season without a holiday or two?), activity in the Global Justice Movement seems to be picking up.  Blog readership is much greater than it has been, and several projects are coming to fruition, while ongoing ones are, well, ongoing — which is something, considering how ephemeral many things are these day.  So, to close out the week:

Thursday, December 7, 2017

More Comments on Keynes



Yesterday we hung our Canadian correspondent out to dry by publishing his comments on Keynes . . . with his permission, of course.  We wouldn’t want to offend those aggressive Canadians who would then swarm across the border to take bloody revenge, crying havoc and letting slip the dogs of war.

Wednesday, December 6, 2017

Some Comments on Keynes



A short time ago we made a few remarks about Lord Keynes, the Defunct Economist who rules modern political economy.  Within hours of posting the comments, we heard from a faithful reader up in Canada, who started off with, “Interesting read.”  Well, “interesting” can be good or bad; we recall the foreword G.K. Chesterton wrote to a book by the guild socialist Arthur Penty that said the questions Penty raised were “interesting” and “important” . . . and managed to say not one word one way or another about Penty’s answers. . . .

Tuesday, December 5, 2017

Quit Modifying Capitalism!



A few weeks ago Andy Kessler raised an interesting point in his piece, “Quit Modifying Capitalism” in the Wall Street Journal of November 20, 2017 (page A15 if you’re curious).  As Kessler suggested, capitalism is capitalism, and socialism is socialism.  Why cover up with meaningless qualifications?  Kessler had in mind such modifications as "democratic capitalism," "social capitalism," "ethical capitalism," even "free market capitalism" — you name it.

Monday, December 4, 2017

The Just Third Way Hour Podcast



The latest Just Third Way Hour podcast again features an interview with Michael D. Greaney, CESJ’s Director of Research.  Greaney talks about how the Just Third Way might help start-ups, and how to handle private ownership of land and natural resources in a just manner.

Friday, December 1, 2017

News from the Network, Vol. 10, No. 48



Everyone here at CESJ survived Black Friday . . . mostly by staying in the office and working to advance the Just Third Way.  We figure the greatest gift we could give to the human race is one of hope for the future, and the Just Third Way has that and more:

Thursday, November 30, 2017

Money v. Currency



One of the problems with talking about things other people either don’t know anything about, or (more often) who are operating within a different “paradigm” (“a philosophical and theoretical framework of a scientific school or discipline within which theories, laws, and generalizations and the experiments performed in support of them are formulated”) is that matters can often get . . . confused.  People often use the same word with different meanings, while some even change the meaning of words within a single sentence, sometimes without realizing they are doing it.

Wednesday, November 29, 2017

How to Stimulate Economic Growth


Yesterday we noted that fiddling with the tax system does not really affect the aggregate rate of economic growth.  Assuming that the government is not emitting bills of credit and inflating the currency and that private opportunists also are not printing their own money, the amount of spending in the economy will remain the same, regardless of the tax rate, even if the tax rate is 100%.

Tuesday, November 28, 2017

About That Corporate Tax Rate



The “conservatives” claim that taxing corporations less will stimulate the economy, result in new capital formation, and create jobs.  The “liberals” claim that taxing corporations less will mean taxing people more, depress the economy, result in new capital formation, and destroy jobs.

Monday, November 27, 2017

Birth of the British Currency School



For quite some time, we have been making references to the “Currency Principle” versus the “Banking Principle.”  Understanding the differences between the two is key to understanding today’s problems with money and credit, and why adherence to the Currency Principle precludes restoring Say’s Law of Markets and establishing and maintaining a society characterized by widespread capital ownership.  So here goes —

Friday, November 24, 2017

News from the Network, Vol. 10, No. 47



Even with the mid-week holiday and two days without internet access (long story), things have been moving well along, with great strides being made in a number of areas.  This is encouraging, because things often slow down at this time of year, whereas for us they seem to be picking up:

Thursday, November 23, 2017

Happy Thanksgiving!

Since you should have better things to do today than read even this blog, we'll let you off the hook with a brief holiday greeting:

Happy Thanksgiving

And if you want something more. . . .

Wednesday, November 22, 2017

A Pecuniary Paradox



Today we look at one of the more bizarre, even baffling paradoxes that afflicts the modern global economy, albeit one that has become so engrained in monetary and fiscal policy as to rank as unquestioned — and unquestionable — dogma of The Great Defunct Economist, He Who Reigns Above All Other Economists, Alive or Dead.  In case the heavy-handed sarcasm hasn’t alerted you to whom we refer, that’s John Maynard Keynes.

Tuesday, November 21, 2017

Who Invented Social Justice?



Judging from current literature, lectures, and what-not, “social justice” is just another name for socialism.  Is that really the case, though, given that, e.g., the Catholic Church has been extremely supportive of social justice, but “down” on socialism?  Are socialism and social justice really just different names for the same thing?

Monday, November 20, 2017

The Just Third Way Hour Podcast



The latest Just Third Way Hour podcast features an interview with Michael D. Greaney, CESJ’s Director of Research.  Greaney relates about how he learned about CESJ, and talks about his two upcoming books.

Friday, November 17, 2017

News from the Network, Vol. 10, No. 46



Even with the “Holiday Season” right around the corner next week, things are happening on the Just Third Way front.  The CESJ core group has put together the outlines of the presentation that could be the basis of a lecture or an interview, new podcasts are being recorded on schedule, and the new and revised publications are on track:

Thursday, November 16, 2017

The Nature of Truth



You get into the strangest arguments on the internet . . . and sometimes they really are arguments, that is, “a coherent series of reasons, statements, or facts intended to support or establish a point of view.”  Not like what we got into, thankfully just on the fringes.

Wednesday, November 15, 2017

Faith or Reason?



A while back we got into a rather pointless argument — with a lawyer, no less — about whether the natural law is discerned by faith, or by reason.  Despite what you might think, it was the lawyer who argued for a faith-based understanding of natural law!  (And he was supposed to be an expert on constitutional law, too, oy weh.)

Tuesday, November 14, 2017

Random ESOP Musing



As we may have mentioned once or twice in the past, we like to get questions from our loyal readers . . . “loyal” being defined as anyone with a query that does not begin, “Are you stupid-insane-crazy, etc., etc., etc., for saying something with which I disagree, misunderstand, or can’t pronounce?  (The answer, by the way, is “yes.”)

Monday, November 13, 2017

The Just Third Way Hour Podcast



We’ve been a little remiss in posting the link to the CESJ podcast, scheduled for release on a weekly basis . . . so here are the first few weeks’ worth.  The newest one is always at the top, so if you want to catch up, start at the bottom and work your way up.  These are mainly informal talks about matters relating to the Just Third Way, so tune in and turn on to the Just Third Way with your host, Bryan Vosper:

Friday, November 10, 2017

News from the Network, Vol. 10, No. 45



A number of CESJ initiatives have made a great deal of progress this week.  We have been talking with people from across the globe and even in the United States, as can be seen from this week’s news items.  Our electronic outreach seems to be having some effect, and the social media, podcasting, and now even television are starting to pick up on the Just Third Way:

Thursday, November 9, 2017

VI. Reinventing Religion



Far from being a “religious” problem, what has been happening with respect to social justice affects the whole of society.  The fact remains, however, that — at the same time — the issue is “religious” in that what eventually became known as socialism first arose within Christianity as an alternative to the existing economic, political, and religious order, and based on a different idea of the dignity of the human person.

Wednesday, November 8, 2017

V. “Doing” Social Justice



No virtue — and social justice is a virtue — can be imposed by force, a monopoly of the State, (human) nature’s only legitimate monopoly.  Force can be used to prevent injustice or punish wrongdoing, but not to impose virtue.  Everyone is free to be unvirtuous, as long as in being so he or she does no harm thereby to others or to the common good.

Tuesday, November 7, 2017

IV. Foundation of Confusion



As a follow-up to last week’s look at social justice, yesterday we looked at social charity, that, just as individual charity is the “soul” of individual justice, is the “soul” of social justice.  We discovered that (as Father Ferree put it) in social justice nothing is impossible . . . even if the institution in need of reform is social justice itself!

Monday, November 6, 2017

III. The First Step



Last week we looked into the real understanding of social justice: the virtue that reforms institutions to make individual virtue possible once again, but does not replace individual virtue.  What do we do, however, when social justice is the very institution that needs reform?

Friday, November 3, 2017

News from the Network, Vol. 10, No. 44



Some new initiatives, the near-completion of others, and restarting still others have marked this week.  As the end of the year approaches, this bodes well for continued success in the coming year:

Thursday, November 2, 2017

II. The Problem (and Solution) of Social Justice



Yesterday we raised the question about what to do when the institution of social justice, the virtue directed to correcting institutions, is the very institution that is in need of correction.  Fortunately, the paradox of the very institution essential to reform being itself in need of reform resolves itself — up to a point.

Wednesday, November 1, 2017

I. A Question of Human Dignity



Modern society, if there are any doubts, is in serious trouble.  Over the last two centuries, the institutions of civil, religious, and domestic society — State, Church, and Family — have been revised, reformed, and reinvented to the point that these chief props of human dignity have become, to all intents and purposes, meaningless.

Tuesday, October 31, 2017

Halloween Horror Special: Marxism



We’re still reeling in disbelief here at CESJ global headquarters . . . and we’re almost out of fish line.  And as for the pole . . . well, we’re talking to him next week, and we’ll see what he has to say.  But enough of bad fake Marx Brothers jokes.  On to the point of today’s Horror Special . . . the wage system!

Monday, October 30, 2017

The Significance of the Frontier



A week or so ago in a posting on how to make tax reform even worse, we noted that when the State starts to take over more and more control over people’s lives, not only the State becomes overburdened with duties, but the citizens become overburdened with taxes.  Somebody, after all, has to pay for such things, such as universal basic incomes; money just doesn’t appear out of nowhere.

Friday, October 27, 2017

News from the Network, Vol. 10, No. 43



The Just Third Way continues to make steady progress.  Interestingly, more and more of the postings on this blog are getting “shared” and “liked” than ever before on FaceBook, and at least one individual has requested a formatted version of a blog for use in a class lecture.  He was having trouble downloading for some reason, so we made a special version in .pdf.  By the way, if you want to use a posting in a class or something, go ahead and print out as many as you want, just give us credit so that people will know where you got it (and if you’re quoting, don’t change any words except to correct spelling or grammar errors):

Thursday, October 26, 2017

Focus on the Fed: The Slavery of Savings



It’s gotten so predictable that we forgot to predict it.  We kept telling people that binary economics and the Just Third Way are based on something called “the Banking Principle.”  As we’ve repeated ad nauseam, the Banking Principle is that the amount of money in the system depends on the velocity of money, the price level, and the number of transactions, not the other way around.

Wednesday, October 25, 2017

Focus on the Fed: Let Us Assume



As all good Keynesians, neo and otherwise, learn in Economics 101, there is a tradeoff between employment and inflation.  The theory is that if you want low inflation, you’ll have to put up with high unemployment, and if you want low unemployment, you’ll have to accept inflation.

Tuesday, October 24, 2017

Non-Productive Money? Are You Serious?



If you read yesterday’s blog posting, you know that Say’s Law of Markets and money creation go together.  In a very real sense, production is money, and money is production . . . if the system is arranged the right way.  “Money” — defined as anything that can be accepted in settlement of a debt (“all things transferred in commerce”) — is the means by which I exchange what I produce, for what you produce, so that every producer is a consumer, and every consumer is a producer; supply and demand are in balance.  That is why money is usually defined as “the medium of exchange.”

Monday, October 23, 2017

How to Make Profits Work for People


. . . instead of making people work for profits.  Which, frankly, is a bad way of putting it, for there is no reason to work at all if there is no profit in it.  What we mean (after titling this blog in a way we hope will catch your eye and keep you glued to the screen), is that — consistent with Say’s Law of Markets — production and consumption should be in balance.

Friday, October 20, 2017

News from the Network, Vol. 10, No. 42



A number of projects have made great progress over the past week, from the proposed re-launch of The Just Third Way Hour to the final editing and review of Red Star Over Bethlehem.  Perhaps it won’t be too much longer before world leaders start catching on to the fact that there is a viable alternative to the sad condition of today’s society:

Thursday, October 19, 2017

How to Make Tax Reform Even Worse



All the recent talk about tax reform, good, better, and worst, has focused on the debate as to which philosophy of taxation, and which specific tweaks to the existing system, will best stimulate an acceptable rate of economic growth.  Commentary has ranged from the sublime to the ridiculous, with the usual barrage of inane and erudite remarks, interspersed with more or less veiled attacks on the intelligence, motives, and fashion sense of anyone on the other side, but no one has raised the real issue here:

Wednesday, October 18, 2017

Nothing Succeeds Like Secess!



Secessionism, according to a piece in the Wall Street Journal yesterday (“Secessionism’s Dangerous Return,” 10/17/17, A15), is big, it’s bad, and it’s back.  The way things are going, it’s 1914 all over again, with the big powers and little people squaring off for a final showdown.  As the author, Walter Russell Mead, a fellow of the Hudson Institute and Professor of Foreign Affairs at Bard College, opines,

Tuesday, October 17, 2017

Austria’s Shift Right . . . or Left



The Königsee in Austria
Both the Wall Street Journal and the Washington Post commented on Austria’s recent election that there was a shift to the right.  Both papers cited gains by the “Freedom Party,” Freiheitliche Partei Österreichs, founded in 1956 as a right-wing populist and national-conservative political party originally led by a former National Socialist and SS officer opposed to socialism and Catholic “clericalism.”  The party’s advance to the number two spot in the number of seats in the legislature is attributed to growing sentiment against immigrants.

Monday, October 16, 2017

A Few Thoughts on Mondragon



Last week we came across an article on the Mondragon Cooperatives in Spain.  And what are the Mondragon Cooperatives, you ask?  (People who are not familiar with them tend to get blank looks, even outrage, when they admit they never heard of them so we’ll spare you the humiliation if you don’t know.  And the sense of superiority if you do. . . .)

Friday, October 13, 2017

News from the Network, Vol. 10, No. 41


Yet another week filled with outreach and information.  The Big Event this week, of course, has been the National Cooperative Business Association Conference, with a number of CESJ representatives interacting with some of the “higher ups” in the organization and discussing the complementarity of the Just Third Way and the coop movement.  There have been a few other things, as well:

Thursday, October 12, 2017

Solidarismo Costariccense: The Solidarity Movement in Costa Rica



With so many members of the CESJ core group in town who knew and worked with Don Alberto Martén Chavarría, founder of the solidarity movement in Costa Rica, we thought we’d let people know a little bit more about it, especially as it provides a core organization that might provide a core organization around which to put together the rebuilding of the entire region.  There can obviously be improvements to make it more consistent with the Just Third Way, but the solidarity movement is a great advance over previous arrangements:

Wednesday, October 11, 2017

Puerto Rico: A Few Suggestions



It’s unverified (by us), but we’ve heard that the “Jones Act Waiver” for Puerto Rico is going to expire and won’t be renewed.  And what, exactly, does that mean?  The “Jones Act,” which dates from the 1920s, stipulates that cargoes going from one U.S. Port to another must be carried on U.S. flag vessels.  This presumably helps the struggling U.S. Merchant Marine by providing employment . . . and greatly increases prices in Puerto Rico. . . .

Tuesday, October 10, 2017

Project Economic Justice: President Reagan’s Speech, II



What with everything else that has happened, Puerto Rico seems to have disappeared from public attention . . . that is, until people start wondering how to rebuild without bankrupting the rest of the United States.  Oddly enough, a possible program for rebuilding that will make money instead of costing money is ready to hand, and only needs to be implemented.  Today we look at the second part of President Ronald Reagan’s speech to the Presidential Task Force on Project Economic Justice that presented the plan.  This is a follow-up to the extract from the strategy paper, “Project Economic Justice: A Beachhead for Regional Infrastructural Reform,” which led up to the work of the Task Force.  For those interested in seeing and hearing rather than (or in addition to) reading, here is the video of the speech: