The Real Problem with Keynes
Reading Keynes’ critique of Gesell the key intellectual failing of Keynes’ entire body of work is best exemplified in this concluding remark:
“Thus if currency notes were to be deprived of their liquidity-premium by the stamping system, a long series of substitutes would step into their shoes — bank-money, debts at call, foreign money, jewellery and the precious metals generally, and so forth.”
If Keynes had merely taken one more step beyond Gesell (and himself) to identify in-place liquidation value of net assets as the tax base (or, if one prefers, one can call it the “demurrage base”) he would have escaped the profound irony embodied in his initial observation of Gesell:
“..whose work contains flashes of deep insight and who only just failed to reach down to the essence of the matter.”
Posted by cladrastis on Fri, 18 Jun 2010 01:24 | #
The only “instruments” with liquidity premium are bankers and liberal humanist politicians.