Arioch @ 88 yes very good point about the internet. Many maybe most US innovations of the 20th Century resulted from government funded research as well, whether through the military or colleges. When Reagan created the “starve the federal budget movement” which is now religion for the GOP, federal educational funding dried up even while research funding increased (through deficit spending). Today much of the research in the US is conducted by imported scientists (immigrants) because science is barely taught in the underfunded US primary education system.
VK (several comments on this thread) – you are correct about China’s investment in infrastructure, however as always I must caution you….Chinese economic theory today is essentially bourgeois. China’s central Bank constantly stimulates its economy to maintain high growth rates. It is not clear to me that the dynamic of state intervention in the economy is fundamentally any different than government intervention in the US. China is led by an single party controlled by the wealthy investors and doesn’t subject itself to nuisances such as regular elections. The emphasis on infrastructure investment reflects China’s status as a developing economy. After a point the ROI on infrastructure growth will dwindle and Chinese 1.47 high net worth investors (“Party members”) will need to search elsewhere for their investments.
There is more consistent control of the economy afforded by the “Single Party Rule” but the benefits still accrue inordinately to the wealthy within the single party. In the US the benefits accrue inordinately to the wealthy of either party. China’s way of course has its beneficial aspects, especially given the culture and huge population. These beneficial aspects become heightened in your mind because you believe the Party has insulated the economy from historical processes. This is currently inarguable in either direction because the future has yet to occur, yet any study of the Chinese economy can yield only one honest conclusion. Terms such as “socialism” and “Marxist-Leninist” are mouthed for propaganda purposes but the Chinese nation and economy are firm;y ruled by its bourgeoisie.
Bourgeois with Chinese characteristics.
Jen @ 96- you are mostly correct but your comment makes much more sense if you focus less on the effect of inflation (high interest rates) and more on cause of high interest rates (inflation). You are putting cart before horse. Inflation provides more benefits to non-asset owners (IE poor and working class) as increased pay allows accrual of more goods, more savings at higher interest rate yields, etc. In an inflationary environment most assets favored by the wealthy tend to lose value. Stock prices fall, housing prices fall (because demand drops as prices increase). Governments only tend to push inflationary policies when the yield turns negative (deflation). This is because all governments everywhere (yes, including in China) represent the interests of the bougeoisie who benefit much more from stable periods of lower inflation and interest rates.
Higher interest rates are the primary reaction to rising inflation which reduce the amount of money in circulation to make inflation subside. Rising interest rates work to tame economic forces favouring the working class. Bank accounts become worthless as safe investments return tiny to negative yields. Riskier investments become more attractive and the poorer have no cushion in which to shield them from higher risk. Higher interest rates lead back to a much better environment for the wealthy to increase their wealth.

Posted by: donkeytale | Jul 13 2019 15:28 utc | 103

“The Turkish economy is not well. Turkey’s relation with the U.S., NATO and the EU are likely to get worse”
IMF estimates almost twice as high growth rates for Turkey than for the US and the EU for the next 5 years. Its population is young and growing. Many forecasts estimate for Turkey to become number 10 – number 12 economy in the world.
By most accounts, it is a rising power.
If the US destroys its relations with Turkey it will shoot itself in the foot. It could well lose its influence in the Middle East and the Black Sea region. The combo Russi – China – Iran – Turkey is stronger in those regions. Bad news for Georgia and Ukraine, as well as for Uyghur and Northern Caucasus destabilisation projects as well.

Posted by: Passer by | Jul 13 2019 15:43 utc | 105

This deal was finalized when the Russians demonstrated there is no such thing, in modern militaries, as an ‘invisible plane’. The Turks are/were in the F35 program for the jobs. Now they can get a hundred first class planes form Russia or China for billion a less.
When the time comes, one of the Zionist F35 invisible planes will be splattered …. over Syria. It is too soon to disrupt the bankruptcy of the US.

Posted by: ger | Jul 13 2019 16:37 utc | 107

When the time comes, one of the Zionist F35 invisible planes will be splattered …. over Syria
Posted by: ger | Jul 13 2019 16:37 utc | 109
You mean, like three years ago?
https://forum.keypublishing.com/forum/modern-military-aviation/147056-israel-f-35-damaged-bird-collision-or-syrian-s-200

Posted by: Arioch | Jul 13 2019 19:10 utc | 109

@ Comandante who ended with
”
It’s almost equivalent to choosing between buying a pool VS a roof for your house.
”
Nicely summarized and thank you!!

Posted by: psychohistorian | Jul 13 2019 20:02 utc | 111

@ cuse
I have to assume your questions are sincere but unfortunately they demonstrate the completely ahistorical nature of the modern popular understanding of everything. You have read 1984 I am sure. The Ministry of Truth was a real thing, just as the Department of Homeland Security was a real thing in Nazi Germany, before it was recreated in the United States following 9/11. It’s all rather depressing and Google won’t help you suss it out anymore as it is now almost exclusively used as a tool of commerce, suppression and the creation of a false consciousness.
It was indeed a segment of the German and Euro elites who conspired to arrange WW1, for the same reasons a segment of today’s global elites conspire to ignite a war with Russia or Iran. Think of the Neocons and you’re well on your way to discovering WHO is responsible for the mess we are in.
I suggest you start here – and if you really want to know WHY things are the way they are don’t stop searching for truth for the rest of your life:
https://firstworldwarhiddenhistory.wordpress.com/publications/hidden-history-the-book/

Posted by: C I eh? | Jul 13 2019 20:40 utc | 113

DBEP – well and bravely stated. The thing about MOA format is that none of us can be held easily accountable for our predictions because it’s very difficult to search prior threads.
But the amount of Putin love has rightfully dwindled since becoming apparent he backs Israel’s interests. And no JR for the thousandth time this doesn’t mean I’m saying Putin is a zionist either. Lol. Juvenile much?
Pro Trumpers and pro Brexiters who are legion believed a dose of nationalist populism would (somehow) defeat globalisation and bring about resurrection in the fortunes of the working class are also watching this delusion crumble by the day.

Posted by: donkeytale | Jul 13 2019 21:43 utc | 115

@ William Gruff with comment # 118
Thank you sir for your confirmation of my understanding of China today. I worry a bit about how the private folks can now “own” controlling interest in financial entities but I think this is the same as how you describe the few rich in current China….transitional
Again, thanks!

Posted by: psychohistorian | Jul 13 2019 22:11 utc | 117

@C I eh? #115
The synopsys of the book (from your link) says it is a London cabal plotting to destroy Germany.
That is not a secret – most of Europe was complicit in trying to keep Germany disunified since at least the 100 years war.
However, said synopsys is quite different than what you stated earlier: that it was British and Germans plotting to take over the world.
Thus the credibility to sought to confer, still has not been conferred.
Certainly there were all manner of nasty sub-plots and secrets prior to World War I, but it is equally unclear that plots by people – at whatever level – work out as expected.
A somewhat well known example is the purported quote by Plehve:

A little victorious war to stem the revolution

Posted by: c1ue | Jul 13 2019 23:56 utc | 119

John Merryman @ 55
Users have no legal ownership of money. Users are merely allowed use of it.
Hence a fundamental problem nobody discusses.
If we agree that private property is a desirable feature of a modern society, the type of money in use today poses several significant problems.
Economic actors are exchanging their time, skills and ideas for money. Ergo, they are exchanging something they own naturally (divinely?), for something they:
a) do not own
b) have no control over
c) is constantly eroded in value
d) is taxed at progressively increasing rates because of c
Thus, the artificial manipulation of interest rates lower, induces an arithmetical, albeit gradual, transfer of wealth.
Hence the reason that today, 147 companies, have control of 47 million entities globally.
Hence the reason that the bottom 50% of the population owns 1% of the wealth (and vice-versa)
Hence the reason households are creaking under the weight of debt
Hence the reason the cost of living spirals ever upwards.
Hence the reason companies have opted to off shore their operations
Hence the reason wages cannot keep up with the cost of living
Hence the reason business dynamism has been choked
Hence a myriad other ramifications ranging from the price of drugs to the raison d’etre of the UN (or the world bank or the IMF) to wars in far flung places.
It all comes down to the right to private property and the nature of money; what it is and what it is not.
g

Posted by: guidoamm | Jul 14 2019 5:14 utc | 121

@ c1ue
You read the first paragraph and stopped. Please do your own research.

Posted by: C I eh? | Jul 14 2019 8:40 utc | 123

@donkeyposterior: A hundred million is quite the “handful”. When you get down to pragmatics, China is more democratic (small “d”, no trademark symbol) than the United States. Most Americans opposed NAFTA, yet NAFTA happened anyway. China’s president Xi Jinping (presumably) agreed to some of Trump’s trade deal, but was overruled by the Communist Party. A hundred million party members went home, asked their coworkers, neighbors, friends, and family for their opinions, then armed with the feedback from many hundreds of millions of Chinese people they returned to decide on the Trump deal. They threw it out because the Chinese people couldn’t be sold on it.
Of course, to brainwashed Americans that doesn’t look like the idea of “Democracy™” they’ve been programmed with, but somehow the Chinese government ends up serving the aggregate interests of the Chinese people. Meanwhile the vast majority of Americans want America’s wars of aggression to stop and they want Medicare for All, but despite supposed “Democracy™” these things never come to be. America’s “Democracy™” serves the interests of a handful of uber-wealthy while ignoring the interests of the population, but China’s “totalitarian” government ignores the interests of the uber-wealthy and serves the population. To many Americans this defies comprehension.
Likewise Erdoğan brushing off the demands of the American empire is incomprehensible to Americans. Erdoğan believes that the US was behind the attempted coup (many people with more knowledge of the matter than was revealed in the western corporate mass media agree with him). Whether or not it is true is irrelevant to Erdoğan’s decisions. He needs insurance against a repeat attempt. Meanwhile Americans be like “Why would we instigate a coup? We don’t do things like that! Well… yeah, except for in Iran, and then in South Vietnam, and in Indonesia, and in Congo, and in Ukraine, and in every country in Latin America… but aside from those times we would NEVER instigate coups!”

Posted by: William Gruff | Jul 14 2019 12:05 utc | 125

@donkeyposterior: The Chinese are navigating the end stage of capitalism right now. Late stage capitalism is where humanity is at. The Chinese realize it and have a plan. Most people in the West, like yourself, are clueless and think this is just another downer episode in the drama of capitalism that will eventually be followed by another capitalist golden age. Trump is playing the best cards that the empire has left to restore real economic activity in America but those efforts are failing. You will never again see real growth in wages and broadly shared improvements in standards of living in the USA. Those days ended in the 1970s and they can never come back under capitalism.
Large portions of China’s infrastructure have been developed using “Public-Private Partnerships.” Why would communists agree to something like that? Because they know the private share of ownership is just temporary. The bust in the value of the US$ is coming at some point, and judging by how aggressively America is employing sanctions as a weapon, we are in the use-it-or-lose-it stage of that game. That suggest the bust is coming relatively soon… possibly even within the next few years while Trump is still in office. With the next 2007-style economic shock it is likely that the global faith in the US$ will be lost, which means that the US Treasury cannot just crank up the printing presses again to bail out big finance. Between now and then China will continue to reduce their exposure to the US$, but even so, many of those private enterprises invested in Chinese PPP ventures will go bankrupt. Is that a problem for China? In the western perspective like what you possess it is disaster, but the fact is that the infrastructure and productive capacity in China will simply revert to public ownership. Chinese people with modest savings will get bailed out FDIC-style while big investors will be wiped out with no recourse.
When this happens there will be several weeks of economic “excitement” in China as new norms are established, but standards of living for the Chinese common man will actually increase. Meanwhile, the United States will see several weeks of hyperinflation as countries fall all over themselves trying to liquidate their US$ reserves while they still have value. Cheap Walmart disposable t-shirts hitting several hundred dollars per pack of three is not unreasonable.
While this will wipe out a great deal of paper wealth in the world, Chinese standards of living will rise. Why is that? The same reason that sanctions on Russia triggered economic growth there as well. Russia’s domestic manufacturing was neglected and underutilized (not gone altogether like America’s is now), so when dollar-denominated products (imports) became too expensive the Russian people substituted domestically manufactured goods, leading to a boom in domestic manufacturing.
China likewise has domestic manufacturing (the most in the world now), though it isn’t neglected like Russia’s was. When the US dollar pops, Chinese good will become more expensive outside China (most dramatically in the US) which will create significant deflationary pressure on products made in China. Being that these goods are denominated in RMB, even slight deflation will work to the advantage of the Chinese population, while bankrupting private investment. Unlike in the West, though, when these bankruptcies begin the actual manufacturing facilities owned by these businesses will not be liquidated. Since most of the large enterprises in China are set up with as much as half or more of the shares being held by the state, ownership simply reverts to the public sector when the private sector goes under.
This, by the way, is all by design. In fact, if the US$ holds out longer than expected and doesn’t pop at the ideal time for China’s plans, they can easily engineer the necessary financial crisis needed to usher in the next stage of economic development.
The difference between you and the Chinese is that the Chinese know that we are watching capitalism’s endgame play out in real time. People like yourself, on the other hand, are operating under the illusion that all that is needed is a new president and a few little tweaks to the economy and all will be well again. The reality, though is that the empire’s economy is on the gurney in the ICU and is already dead. The machinery in the ICU (state intervention) is keeping the corpse of capitalism from decomposing, but it is not going to be getting up and running any marathons anytime soon.

Posted by: William Gruff | Jul 14 2019 17:37 utc | 127

@127 William Gruff & AntiSpin & psychohistorian
Thanks for the words on China. The propaganda and racism about that country have existed from centuries before any of us were born. We’re all well soaked in it, and some of us are learning our way out of it.
For the best list of features to compare the US/West with China when it comes to democracy, I always recommend this article by Godfree Roberts: Selling Democracy to China – Still too soon to tell?
Spoiler: China far excels over the west in its structures of representative government. And that’s even discounting the Orwellian dystopia that many in the west are rightly afraid is saturating our national systems.
~~
And Jeff Brown, as linked by AntiSpin @118, probably offers the most prolific and best understanding of the Chinese system and its society. Brown has talked about the phenomenal poll-taking that the Chinese government undertakes – hundreds upon hundreds of surveys continuously in order to find out what its massive population wants, and how it feels about what it has. This, in a nation that will execute officials found guilty of corruption.
It’s very clear that the Chinese Communist Party runs China, including to the extent of having ultimate power over Xi. It’s also clear that the Party wishes to do the right thing for its country. This is the ancient and eternal Chinese way. The ruler holds supreme power, just so long as the people have no overarching grievance against this rule – at which point, revolt occurs. So, we can be sure that Beijing rules, but equally sure that it is actively soliciting feedback at all turns from the ruled.
I find this a very wise and self-stabilizing balance of power.
~~
As to the billionaires, they will be sur-taxed or even seized if the government determines the need to rein them in – and they know this, just as surely as they know the Party allowed them to become rich. Right now, China is still in a great expansion mode, to say the least.
But there should be no doubt that the Party runs the economy as well as everything else. And it runs it deliberately, and from extensive planning, and with great care. And aligned with the principles of socialism.
And as economist Dr. Richard Werner once explained in this wonderful interview at RT’s Renegade, Inc., when you create money through loans, but spend that money into the productive economy (so that an increased money supply is also chasing an increased volume of goods), then you don’t experience inflation and your level of inequality doesn’t increase:
The Finance Curse

Posted by: Grieved | Jul 15 2019 1:21 utc | 129

Gruff
Thanks for your continued participation in this dialogue.
Here is what gets misunderstood. There is a disconnect between politics which are national and economics which are global and personal finances which are me and you and everybody else.
The state is in a subordinate in the west and dominant in the East but at the end of the day the state reflects the people who hold the power within the state.
Worldwide the parties who hold the power within the state are ruled by the individuals who own the most wealth.

Posted by: donkeytale | Jul 15 2019 5:20 utc | 131

UserFriendly | Jul 13 2019 1:16 utc 66
Thank you for the MMT link on Financial Times, which unfortunately required me to register (I did). The authors describe MMT’s view of inflation management within the framework of a Green New Deal, now in play within the US presidential discourse.
I’ll add a quick excerpt from FT Alphaville blog: An MMT response on what causes inflation

This week in testimony to the Senate Banking Committee, Jay Powell, Chairman of the Federal Reserve, offered a verdict on modern monetary theory. “The idea that deficits don’t matter for countries that can borrow in their own currency I think is just wrong,” he said. It was a victory for the movement, of sorts: modern monetary theory is now unavoidable. It now must be addressed in a committee hearing of the US Senate.
… First, when we suggest that a budget constraint be replaced by an inflation constraint, we are not suggesting that all inflation is caused by excess demand. Indeed, from our view, excess demand is rarely the cause of inflation. Whether it’s businesses raising profit margins or passing on costs, or it’s Wall Street speculating on commodities or houses …
Second, we do not believe that any and all inflation that does result from excessive demand can and should be addressed by higher taxes. … When MMT says that a major role of taxes is to help offset demand rather than generate revenue, we are recognising that taxes are a critical part of a whole suite of potential demand offsets, which also includes things like tightening financial and credit regulations to reduce bank lending, market finance, speculation and fraud. …
Third, when we do advocate using tax increases to address inflationary pressure, we are not suggesting that Congress attempt to raise taxes in real time after inflation has already emerged. Indeed, our approach is precisely intended to avoid a situation in which Congress merely spends without paying attention to inflation dynamics until it is too late. Thus, we argue varying tax rates and other inflation offsets should be included in the budgeting process from the outset. In our approach, an MMT-informed Congressional Budget Office would produce detailed reports of how specific spending or lending proposals would increase demand and which sectors and regions would be most affected, and would monitor inflationary pressures closely to determine the appropriate policy response based on specific conditions.

Well worth a read for additional points.

Posted by: jonku | Jul 16 2019 20:31 utc | 133

This is par for the course with the Outlaw Empire and its vassal states.

How do you mean? Where are the parallels? To me this looks like an unprecedented cracking up of the ZUSA Empire.

Posted by: foolisholdman | Jul 19 2019 10:48 utc | 135

Sorry! Mobey = money

Posted by: foolisholdman | Jul 19 2019 11:45 utc | 137