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Status Items Output None Questions None Claims None Highlights Done See section below
Highlights
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Polish economist Michal Kalecki argued that government spending could ensure a permanent economic boom with both low employment and increased business profits. Crucially, however, Kalecki predicted that business executives would hate having what everyone else sees as a good economy, because it would allow regular people to be less subservient to them.
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“Unemployment has to jump 40, 50 percent in my view,” Gurner explained, with the cool affect of a sociopathic surgeon explaining why he has to cut into your body. “We need to see pain in the economy.”
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Gurner Group founder Tim Gurner tells the Financial Review Property Summit workers have become “arrogant” since COVID and “We’ve got to kill that attitude.”
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internal Bank of America memo that stated “we hope the ratio of job openings to unemployed is down to the more normal highs of the last business cycle.” Translated into English, this means the bank was rooting for there to be fewer job openings.
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California real estate CEO said on an earnings call last year that a recession could be “good” if “it comes with a level of unemployment that puts employers back in the driver seat and allows them to get all their employees back into the office.”
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Janet Yellen, the current secretary of the Treasury and former chair of the Fed during the Obama administration, wrote this in a 1996 memo: “Unemployment serves as a worker-discipline device because the prospect of a costly unemployment spell produces sufficient fear of job loss.”
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What’s striking about these sentiments is they don’t always involve complaints that low unemployment is allowing workers to bid up wages and thereby hurt businesses’ profits.
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Rather, his complaint is that regular non-titans have more leverage with low unemployment — and hence are getting uppity and not showing due deference to their betters.
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“We need to remind people that they work for the employer, not the other way around,” Gurner said. “There’s been a systematic change where employees feel the employer is extremely lucky to have them, as opposed to the other way around. It’s a dynamic that has to change. We’ve got to kill that attitude, and that has to come through hurting the economy.”
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Kalecki started his essay by declaring “a solid majority of economists is now of the opinion that, even in a capitalist system, full employment may be secured by a government spending program.” It didn’t require armed conflict, though: Socially productive spending or just handing out money to everyone would do just as well.
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The key limiting factor, Kalecki believed, was not some shortage of money, since the government could create as much money as it wanted. Rather, it was the productive capacity of the economy.
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Under a regime of permanent full employment, the “sack” would cease to play its role as a disciplinary measure. The social position of the boss would be undermined, and the self-assurance and class-consciousness of the working class would grow.
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“[D]iscipline in the factories” and “political stability” are more appreciated than profits by business leaders.