Today I am pleased to present a double feature on economic policy. Michael Hudson leads off with an explanation of economic policy as a social cost to the working class, and I follow up with an explanation that US economic policy is an act of national suicide.
A couple of definitions: A rentier economy is one in which monopolization or concentration of ownership permits profit without contributing to the welfare of society. Economic rent consists of payments or a rise in value of an asset in excess of its contribution to output or the cost of bringing it into production. An example of economic rent is a taxpayer financed road or transportation system. The rise in land values constitute economic rents, unearned income or wealth unrelated to any activity of the property owner.
The Fedâ€™s Austerity Program to Reduce Wages
For Wall Street and neoliberal economic policymakers, the solution to price inflation is to push the economy into recession. Rising unemployment reduces aggregate demand. Thus, inflation is brought under control by forcing workers out of their jobs.
This class-war doctrine is the prime directive of neoliberal economics. The Federal Reserve and IMF are are the operating arms for impoverishing the masses. Whether it is Janet Yellen at the Treasury, the Federal Reserve, or the financial press, discussion of todayâ€™s U.S. inflation is framed in a way that avoids blaming the 8.2 percent rise in consumer prices on the Biden Administrationâ€™s New Cold War sanctions on Russian oil,