Driscoll report

[Young Master Smeet]

Former North East Mayor (and I believe now Green Party member) Jamie Driscoll has published this interesting report:

Home

Now, it’s actually fairly standard soft-left social democrat fare: but the presentation style is interesting, and I think we could do well to steal some of the design features: the pamphlet is like a short online course, which might appeal to some people.

I’ve not read it all, yet, its central thesis is that there is a lack of will, rather than institutional interests. It seems worth a look.

[ALB]

Actually, we do have something set out like that. It’s here ;

http://www.worldsocialist.org

[Young Master Smeet]

Thanks ALB, that looks really good, must point more people to it.

So, thinking further about the content, this seems to be the crux:

Money without middlemen

The idea being to get rid of the secondary market in government bonds; but I can’t see how that can work, since even if the bond itself isn’t tradable, the owner can make a contract to give the interest and the bond redemption to a third party. These alternative contracts will then become available, and people will buy them rather than government gilts, and therefore this will affect the interest rate that the government will have to pay.

I think he admits as much here: “The objection is narrower: against a tradable gilt of the same term, the holder gives up the right to sell, and will want paying for it.” i.e. off-market financing will be more expensive than open market financing.

The alternative would be to actively forbid the bond holders from forming such contracts, this could be done via institutional investors (local governments, pensions, etc.) but then we are approaching state capitalism and an almost entirely planned market economy.

• This reply was modified 1 month, 1 week ago by Young Master Smeet.

[ALB]

I have just read my way through his manifesto. It’s the first thing by a Green I’ve read that has shown any sign of (capitalist) economic literacy. His description of the consequences of the state relying on outsourcing services to profit-seeking private enterprises (the pursuit of short-term profits and the distribution of much as them as possible as dividends) is accurate enough as well as much of the other financial stuff.

None of the usual nonsense from Greens about banks being able to create credit out of thin air and silly reforms to counter this. The school of reformist economic thought that he seems to adhere to is Modern Monetary Theory, as can be seen from this section:

The pound that comes back

The “sovereign state” pays for something and then gets it back as taxes and financial benefits from what it paid for. This might work if the state was completely sovereign which Britain isn’t as it depends a lot of imports and exports. Driscoll hardly takes this into account and seems to want to isolate Britain from or at least drastically its reduce dependence on the world market and its forces. Which won’t work as he intends.

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