Since the onset of the post-Keynesian backlash of the 1970s economists have tended to put forward ‘political’ views that support one variation of crude capitalist ideology or another. The purgatory of the last seven years has forced assertion of economic contradictions that more closely approximate theoretical incoherence. On the one hand ‘the economy’ is either at long last, or has been for some considerable period of time, on the mend and on the other some nebulous malady– ‘secular stagnation’ or some such, precludes ‘normalization’ to a pre-crisis state of affairs. Policy prescriptions are meeting the facts of ongoing dislocations while political posturing forces improbable explanation through the filter of Party politics. And while implausibility has rarely been a hindrance to selling bad ideas, subsequent facts do occasionally place them in the context they deserve.
The back-and-forth of aggressively bland, quasi-academic, economic blather could be taken as a side show was it not for its implications. Federal Reserve policies are being framed in populist terms, as salvation for the forty-six million people receiving food assistance and the overwhelming majority of citizens living paycheck to paycheck, when the inside scoop is that bankers have re-taken the economy to the point where any effort to ‘normalize’ economic policies would quickly send the financial and financialized economies into crisis. The paradox of populist posturing in support of policies that knowingly or, worse yet, unknowingly support the forces of banker hell might be entertaining if millions of lives weren’t dependent on good outcomes.
Left substantially unsaid is that current circumstance is a function of the irresolution of the last seven years, which itself is an outcome of the neo-capitalist revolution of the 1970s. The mainstream debate over trade ‘imbalances’ versus inadequate fiscal and monetary policies leaves unaddressed the disparity between the full recovery of corporate profits and ruling class incomes and bank accounts and the unrelenting grip that the Great Recession has on everyone else. Implied in the terms of the mainstream debate is that all is not well. And implied in the fact that all is not well is that the mainstream debate is wholly irrelevant to policies likely to be implemented. Put differently, why haven’t the Federal government and the Federal Reserve done for the rest of us what they’ve done for the rich?