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Jan Kregel opened this year’s Minsky Conference (which just wrapped up yesterday) with a reminder that the broader public challenges we face today are still in many ways an echo of those that faced the nation in 1930s. What follows is an abridged version of those remarks: This year’s conference takes place in an increasingly charged and divisive economic and political atmosphere. Sharp differences in approach are present within the new administration, within the majority party, and even within the opposition. It is a rather different environment than the one envisaged when planning for the Conference started last September. I had originally proposed as a title “The New Administration meets the New Normal: Economic Policy for Secular Stagnation.” It was an obvious attempt to hedge our bets on the outcome of the election. After the election the first adjustment to the title was “Can the New Mercantilism Displace the New Normal: Economic Policy under the New Administration.” As you can see the final title eventually adopted the elocution proposed at the presidential Inauguration. My intention was not to elicit recollection of the “America First” committee’s support of isolation from the emerging European conflict in the 1930s. It was rather to recall that the phrase was first used, to my knowledge, by Franklin Roosevelt during his first election campaign. Herbert Hoover had resolutely refrained… Read More

The Justice Verma Committee submitted its report on January 23, 2013. In addition to recommendations for reforming laws related to sexual violence, harassment, and trafficking, it provided a comprehensive framework for gender justice through a proposed “Bill of Rights.” The Verma Committee’s recommendations are still waiting to be transformed into public policy. We must not forget that this document represents an intense 30 days of work in response to a brutal gang rape of a young student in the heart of the nation’s capital in a public transport vehicle in the late evening of December 16, 2012. She was returning home with her friend after watching “Life of Pi.” The power of this report is the acknowledgment (in the very first line of the report) that this brutal event represents a “failure of governance to provide a safe and dignified environment for the women of India, who are constantly exposed to sexual violence.” The acknowledgement is a clarion call for government policies to ensure dignity, safe mobility, and security for women. “Bill of Rights” The Bill of Rights is a proposed charter that would set out the rights guaranteed to women under the Constitution of India, against the backdrop of India’s commitment to international conventions. These rights are articulated as the right to life, security, and bodily integrity; democratic and civil… Read More

REGISTRATION IS NOW OPEN: April 18–19, 2017 Levy Economics Institute of Bard College Blithewood Annandale-on-Hudson, New York 12504 The 2017 Minsky Conference will address the implications of the new administration’s “America First” policies, focusing on the outlook for trade, taxation, fiscal, and financial regulation measures to generate domestic investments capable of moving the growth rate beyond the “new normal” established in the aftermath of the Great Recession, without jeopardizing financial stability. It will also seek to assess the impact of different financing schemes on both infrastructure investment and the return of central bank monetary policies to more neutral interest rates. Since these new policy proposals will have a global impact, the conference will focus on their implication for the performance of European and Latin American economies. Register here. The preliminary program and list of participants is below the fold:

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Why do so many pundits and politicians, including the future director of the Office of Management and Budget, beat the debt drum so loudly and so often? It’s one of the most effective, and most abused, wedge issues in American politics. by Kerry Pechter The nomination of Mick Mulvaney—deficit hawk, three-term Republican congressman from South Carolina and founding member of the House “Freedom Caucus”—to the cabinet-level directorship of the Office of Management and Budget is not good news for the financial system. Mulvaney has said (and perhaps even believes) that one of the “greatest dangers” we face as Americans is the annual budget deficit and the $20 trillion national debt. This notion is an effective political weapon, but it’s dangerously untrue. If it were true, the country would have failed long ago. Debunking this canard should be a priority for anybody who cares about retirement security. As long as we believe in the debt bogeyman, we can’t productively solve the Social Security and Medicare funding problems, defend the tax expenditure for retirement savings, or even create a non-deflationary annual federal budget. Everything will look unaffordable. Hamilton, the Broadway star If you don’t believe me, believe Alexander Hamilton. In 1790, the new nation was awash in government IOUs but had little cash or coinage for daily commerce. Hamilton, the impetuous future Broadway… Read More

A little while back, Pavlina Tcherneva appeared with Bloomberg’s Joe Weisenthal to talk about the potential infrastructure policy of president-elect Donald Trump. She noted that, contrary to initial assumptions, the upcoming administration may not end up pushing public-debt-financed infrastructure spending, and that if the program simply amounts to tax incentives and public-private partnerships, it won’t be nearly as effective. But Tcherneva added another important dimension to this debate. (You can watch the interview here): Tcherneva’s point is that infrastructure investment should be determined primarily by the state of dilapidation or obsolescence of our roads, bridges, etc., and not so much by the moment we occupy in the business cycle. There are some who would argue that the time for a large fiscal stimulus has passed, with unemployment at 4.6 percent and growth continuing apace. There’s a good argument to be made that we’re not at “full employment” even at this moment, and that there’s no need to back off on stimulus (though there’s still the question as to whether the Federal Reserve would attempt to depress economic activity by raising interest rates in response to any substantial fiscal expansion — and, additionally, whether the Fed would succeed in those circumstances). But the point is, where you stand on this debate regarding the business cycle and the meaning of full employment shouldn’t be the driving factor behind… Read More

New York City September 13–15, 2017 A workshop organized by the Levy Economics Institute of Bard College with the generous support of The William and Flora Hewlett Foundation The goal of this workshop is to advance the current framework that integrates gender and unpaid work into macroeconomic analysis and enables the development of gender-aware and equitable economic policies. We are interested in contributions that address the gender implications of macroeconomic processes and policies and examine mechanisms that link gender inequalities to macroeconomic outcomes. These may include but are not limited to: Incorporation of the realm of unpaid productive activities into economy-wide models (e.g., SAM, CGE). Analysis of the links that connect economic structure (e.g., sectoral composition of economy, degree of openness) and growth regimes (e.g., wage-led versus investment-led growth) with women and men’s economic outcomes and gender inequalities. Assessment of the channels through which macroeconomic policies influence women’s and men’s economic outcomes and gender inequalities. These include fiscal policies and monetary policies related to interest rates, exchange rates, and financial markets. Evaluation of the mechanisms whereby gender inequalities influence macroeconomic outcomes, such as aggregate output and employment and their sectoral composition, inflation, budget deficits, and current account balance. Aspects of interconnections between unequal international economic relations (trade and finance) and gender inequalities. The types of gender inequalities to be modeled… Read More

In a presentation here at the Levy Institute, Emilios Avgouleas argued that financial regulatory changes since the crisis have become so complex they represent a source of financial instability, and that new liquidity and capital requirements have contributed to the problem of “short-termism” in finance. Avgouleas proposed regulatory simplification and a reorientation that would create greater relative incentives for funding long-term investment projects (e.g., infrastructure), including a lower regulatory and tax burden on long-term instruments. Empowering issuers of long-term instruments like project bonds with intellectual property rights could, he suggested, help control the quality of these financial products by preventing “slicing and dicing” in derivatives markets, on pain of losing prescribed privileges. You can watch the presentation below: “The Financial Regulation Conundrum: Why We Should Discriminate in Favor of Long-Term Finance” [iframe width=”427″ height=”240″ src=”https://www.youtube.com/embed/1jFUkSdp7J8″ frameborder=”0″ allowfullscreen></iframe]

If you’re a grad student or just starting out your career and want to learn more about the work of Hyman Minsky and Wynne Godley, and wouldn’t mind doing so in a turn-of-the-century manor on the banks of the Hudson, you’re in luck. The Levy Institute’s annual Minsky Summer Seminar is now accepting applications for the June 2017 session: The Levy Economics Institute is pleased to announce that it will hold the eighth Minsky Summer Seminar June 10–16, 2017. The Seminar will provide a rigorous discussion of both the theoretical and applied aspects of Minsky’s economics, with an examination of meaningful prescriptive policies relevant to the current economic and financial outlook. It will also provide an introduction to Wynne Godley’s stock-flow consistent modeling methods via hands-on workshops. The Summer Seminar will be of particular interest to graduate students, recent graduates, and those at the beginning of their academic or professional careers. The teaching staff will include well-known economists working in the tradition of Minsky. To apply, send a letter of application and current curriculum vitae to Kathleen Mullaly at the Levy Institute ([email protected]). Admission to the Summer Seminar includes room and board on the Bard College campus. A registration fee of $250 is required upon acceptance. Due to space constraints, the Seminar will be limited to 30 participants. Applications will be reviewed on a rolling… Read More

*Post Updated Below* Fiscal Consolidation, Budget Deficits and the Macro Economy, by Research Associate Lekha Chakraborty, deals with debates about the macroeconomic effects of budget deficits in the context of examining fiscal policy in India over the period 1980/81–2012/13. From the Introduction: In India, efforts were … made to contain the fiscal deficit by both the central and state governments. The Fiscal Responsibility and Budget Management (FRBM) Act was enacted by the Government of India in 2000 with the aim to … reduce the fiscal deficit to three per cent of GDP by 2008-09. All the states in India also have introduced FRBM legislation. The rationale behind the reduction in fiscal deficits emanated from the theoretical paradigms of macroeconomics which argued that excessive fiscal deficits often trigger inflationary pressures in the economy, increase the rate of interest and crowd out private capital formation, create balance of payments crises and in turn debt spiraling. However, considerable ambiguity exists about the link between fiscal deficit and macroeconomic activity. For more, visit Sage:   Update: Reviews of the book by Pulapre Balakrishnan, Vito Tanzi, and Janet Stotsky may be of interest to potential readers.

Pavlina Tcherneva joins Laura Flanders to discuss the need for a more gender-aware economics: [iframe width=”427″ height=”240″ src=”https://www.youtube.com/embed/fqmy5F98SAs” frameborder=”0″ allowfullscreen></iframe]

Designed as a terminal degree with a professional focus, the Levy Economics Institute Master of Science in Economic Theory and Policy offers students an alternative to mainstream graduate programs in economics and finance. This innovative two-year program combines a rigorous course of study with exceptional opportunity to participate in advanced economics research, with direct access to the Institute’s global network of researchers. Application deadlines are November 15 for Early Decision and January 15 for Regular Decision. Scholarships are available. Visit bard.edu/levyms for more information. Click here to apply. Learn about the Levy M.S. by joining one of our online information sessions hosted by Institute scholars: Wednesday, October 5, 3:00 p.m. EDT, with Research Scholar Michalis Nikiforos Tuesday, October 11, 11:00 a.m. EDT, with Ajit Zacharias, Senior Scholar and Distribution of Income and Wealth Program Director Tuesday, October 18, 10:00 a.m. EDT, with Senior Scholar and Bard College Professor of Economics L. Randall Wray The program application fee will be waived for all prospective students who attend. Click here for details.