Monetarism, Populism, Keynesianism: a productivity matter. And a way out.

By Fabrizio V. Catullo

There is no such thing as "neither leftist nor rightist".
No, there is no good in populism.
And sometimes also Keynesianism and Monetarism are not proper, not good enough.
Sometimes they are even harmful.
It is all a matter of productivity and how you consider it.
If you do it right, there is a way out.
This paper is a rigorous economic theory on that way out.
 

• Language: English
• Publisher: Fabrizio V. Catullo
• Release date: Jun 8, 2020
• ISBN: 9788835845522

Book preview

Out.

​Table of contents:

Preface

Theoretical-Political part

Chapter 1:

Left, Right, Centrism, Populism. The sense of it all

Technical-Economic part

Chapter 2:

A Country's Productivity Structure and its Consequences

Chapter 3:

Keynesianism, Populism, Monetarism: Sometimes

There Is Only One Way Out,

and None of the Mentioned

Bibliography

Author : Fabrizio V. Catullo , 2020

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Distributor : StreetLib

ISBN : 9788835845522

It is easy to harm everyone at the same time.

Almost impossible to do good to everyone at the same time.

Preface

Populism has been a rising phenomenon in the last couple of decades, especially since the great crisis of 2008. Apparently, also based on the EU inequality map that EUROSTAT periodically publishes, that is mostly due to the wealth and GDP per capita divergencies between the states and within the states.

Journalists and establishment parties and politicians, anyway, seem to have no clear idea of what populism actually is and the potential concrete damage to economy it may cause. When it comes to defining it, in fact, they almost all agree on considering it negative and basically characterized by a tout-court aversion against the establishment and an alleged elite governing the world against the interests of the populations, but they always miss outlining clearly WHY it is negative and in which way, especially from the economic point of view; also in public debates, that generic economic-aspect-free definition leaves room, even for common sensed and moderate voters, to the consideration that populism is not that bad after all and it might be the solution to any kind of problems of their nation.

What I did, then, is try to investigate, to find general and complete criteria and characteristics to identify populism and to predict the (generally noxious) effects of it when it comes to actually governing a country and its economy, in the hope that these argumentations can help get rid of populist proposals in the electoral campaigns once and for all.

In the second part instead, the technical-economic one, I describe a thesis of mine which shows how, under a specific productivity structure of a country, a certain economic policy with some slight half-Keynesian character is the only possible one that is healthy and non-populism-generating, adoptable by a government regardless of the political color or economic creed (monetarism or Keynesianism) that administration is more inclined toward. We shall see that, probably, due to the lack of such a policy in Europe the Great 2008 Crisis generated deflation, a slow growth and, in fact, a huge flare of populism, while in the USA the (of course unaware) application of that thesis (with their particular productivity structure) was able to produce the 10-year robust growth we are still witnessing. And, ça va sans dire, without populism! Yes, because even Mr. Trump, as far as he may be bizarre, violent, rude, extreme, allegedly illegally acting, cheeky and probably much more, according to the definition of the present paper, is not a populist.

" Réddite quae sunt Caésaris Caésari".

Theoretical-Political part

Chapter 1: ​Left, Right, Centrism, Populism. The sense of it all

...They say we are just 'populists'; well, let me tell you something: if being a 'populist' means being on the side of the people and pursue their interests, well, I – AM – A – POPULIST and I'm proud of it!!!.

Thunderous applause.

The quote above was pronounced by Mr. Giuseppe Conte as a prime minister, in June 2018, during the speech held for his cabinet's installation in front of the Italian parliament in plenary session. I remember I almost jumped incredulous on my chair after hearing that and I immediately started zapping the TV channels in desperate search of a comment from some journalist or some opposition politician who pointed out the absurdity of that sentence and its suicidal character along with it.

But nothing.

Then a doubt came on my mind: maybe I heard it wrong, maybe he did not actually said that. I turned to the Internet for some recordings of the session and... Yes, he did.

He really said I'm proud to be a populist because I pursue the interests of the people!!!

My goodness... the people WHO??? I could not believe that phrase had not raised a worldwide chorus of hilarity and mocking, with international commentators and politicians going like: Mr. Conte, are You serious? (smiling) Do You really think that the interests, say, of a millionaire investor are the same as those of a worker in a factory or an employee of some firm or a public officer, when it comes to public services quantity and quality, taxes to pay and business and economic regulations?? Because that's what you are candidly declaring: that you'll pursue the interests of all those people at the same moment, with the same economic policy, in one word, with the same government!

But no, unfortunately nobody ever said or wrote such a clarifying thing. Worse still: quite soon almost all the press commentators started either praising or criticizing the administration political agenda on the basis of this or that stance against immigration or the government's confused overall policy or the intent to fight corruption and dishonesty etc. but without ever lingering even for just a second on the basic, fundamental thing missing: there was no clear-and-defined-direction economic policy to actually comment. I'll explain better: what is the purpose of analyzing, for example, the perils of a road that someone is supposed to drive on, if that someone does not know which road he will actually take and even if he is ever going to make a choice, in the first place?

Do not get me wrong: no politician, leftist or rightist, will ever state that her/his intent is to favor a part of the population at the expense of the other, of course. They will all say that they want the good of the entire population, that is normal political rhetoric, it would be very bad marketing otherwise: can you imagine a shop owner admitting, in front of his customers, that for a part of his clientele the competition definitely has a better product? Of course not. But that means no harm to anyone, as the customers know that she/he is a shop owner and thus they expect such uncritical comments on her/his products and then mentally filter the information received and try to get additional one, reading newspapers, watching debates on TV or over the Internet etc.. In the end, if the customer is rich, he will probably visit mostly sports cars salons when it comes to buying a new car while if the customer is a middle-low income one, he will probably visit a ordinary cars salon and leave little room to visiting sports cars salons.

But what if the one offering you a set of cars among which to choose your next buy is a friend? Or at least one who says so, one who says not to be a shop owner but just a good-hearted person who has come into possession of some mixed selection of cars, both ordinary and sports cars and that you can choose whatever you want among them and the price will be fixed later, after your purchase (so basically you might find yourself with a Ferrari paid at the price of an ordinary car or, watch out, with an ordinary car paid at the price of a Ferrari)?

That is the point with populism: the voter does not know what he is actually voting till the moment the populist party wins the elections and goes to power. Then the voter finds out that not even the populist party's representatives know exactly what they want to do simply because... they were not car salesmen of this or that car category, they just presented themselves as friends (and that is why they got the votes) and now they do not know which kind of cars they want to sell and to whom!

The resources of an economic system are limited, that is the basic principle every economist and, better, every politician deals with, every day. There would not be economy itself if it were not so.

If in a democratic, rule-of-law and civilized society [1] based on free market principles you thus allow some people to get richer than others (legally of course, just