For the sake of stimulating demand Western Central Banks willing to “throw money from a helicopter”
Alexander Zapolski
Capitalism returned to the idea of “helicopter money”, proposed by Nobel prize winner for Economics Milton Friedman. To stimulate demand, which forms the basis of Western economic models, the scientist was offered merely to print more money and “throw them down from a helicopter” — that is, directly distribute to the entire population. As stated by the President of the European Central Bank, Mario Draghi, now the measure would be “quite appropriate”.
This clearly showed the depth of the crisis, in which there is the Western economic model. Not production, but consumption has become the main function of a man, and now it is actively transformed into a new form of slavery.
As there was a substitution of meaning
At the dawn of its inception, capitalism was presented as a very useful system: on the one hand, he was able to meet the natural needs of population in goods and services and gave everyone equal opportunity to earn these requirements. But with the development of large conveyor plants, especially with the advent of the era of globalization, the interests of the consumer ceased to be a fundamental principle of economic processes. Modern marketing and advertising techniques allow you to manipulate the demand for improving the margin. The same “iPhones” sold in 10-11 times more expensive than their actual cost. Gradually the only goal of capitalism became the endless profit as such. Here only it turned out that the capacity of world markets is not infinite. As the amount of money needed for consumption.
When, after the mortgage crisis of USA in 2007 revealed that the lion’s share of cash resources tightly linked in quite unprofitable assets, capitalism does not remain anything, except how to go for outright Scam — the so-called “quantitative easing” (Quantitative easing, QE). from November 2008 to October 2014 the US Federal reserve has printed and poured into the economy 4,48 trillion. — that is almost 5 times more than its own assets.
But it didn’t help. How not to help similar measures and the ECB, who printed already more than 1.1 trillion euros total for the year (about 932 billion us dollars). Failed and the Japanese, too, tried to “draw” their yen to 650 billion dollars. … According to rough estimates by the IMF, the total of all QE programs on the planet was approximately 12.3 trillion. $ . or 16.6% of total world GDP. And the real sector of them went… not much of anything.
The money printed under QE and settled on the exchange, of course, did not help the stagnating Western economies. So to save her I decided another approach — namely consumers, guilty that they, you know, out of funds. The obvious solution is to give them these tools so they continued to buy.
Free cheese for slave collar
Of course, all wrapped in a very attractive packaging. Direct transfers of money from the Central Bank to households will enable them to start to spend more, thereby creating much-needed demand to the economy. And, once mentioned that in the first place and in the greatest amount of money should flow to the poorest. However, we should not look for social justice. Just statistics show that they are more inclined to spend money immediately, instead of trying to save them.
And lest, as with QE, it is planned to cancel the handling of cash, and banks to introduce negative interest rates. Not to derail the economy, “helicopter money” should burn. As one of the options, even offered to split the money into types, with reference to their specific “purpose” (food, appliances, clothing, etc.).
Undoubtedly, the distribution of “helicopter money” will allow you to create the appearance of economic recovery. The shops will be buyers, production will have to increase the production of goods. But behind the beautiful facade, as is usually the case with false miracles, lie the details that can radically change the overall meaning.
Money that cannot save, deprive the organization of any business. Why to conquer the markets, to optimize costs, to improve the quality and to innovate, if in the end you can just take free money from the Central Bank “enough”? Moreover, that income cannot be maintained. Cash will be banned, and the Bank for storage of money, too, will have to pay.
And the most unfortunate will be the position of the consumers, because free money, the more “specialized”, will completely devalue all the basic public values. Why strive to get an education, if it provides a better income, and therefore does not lead to increased standard of living? Why bother to work if money are no longer equivalent to the quantity and quality of labor?
All this is in essence not much different from basic slavery. Except that instead of the collars are assumed to be disposable “helicopter money”. How will this “look”, anyone today can look at the example of numerous American and European ghettos, most of the population lives on welfare, and where was the third generation of unemployed for life. In many of these neighborhoods even the police once again prefers not to meddle.
But while capitalists do not care. In striving somehow to preserve their profits, they are willing to “try” any, even the frankly delusional ideas.
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The most sad in this story is that some deputies of the Russian State Duma in all seriousness propose to adopt the “advanced Western economic experience” and as quickly as possible to run in Russia’s own QE. And as we know, and that helicopter money would only be one step…
