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Steve’s guest, Emma Caterine, is a consumer rights attorney with special interest in predatory lenders, like loan sharks and payday loan companies. She begins by talking about credit as a social construct, To understand the Great Recession we must understand the difference between consumer debt, with a high risk of default, and federal spending, which is new money and can never default.
When our economy grows through private debt, it’s unsustainable and leads to crises like the Great Recession.
MMT economists like Wynn Godley, Stephanie Kelton, and L. Randall Wray have shown that the idea that public “debt” and the deficit are inherently evil and to be avoided at all costs, or that financial crises are caused by “imbalance in the economy” are all myths. What we see then is that cutting public spending — austerity — is a political choice.
She also asserts that private household debt and private corporate debt have similar consequences on different scales, though the households bear more of the burden. Private equity firms load companies with tons of debt to be serviced by cutting labor and selling real estate holdings, which is detrimental to surrounding local communities – people of color and the working poor in particular. This growth model based on private debt proves that lessons weren’t learnt from the Great Recession. It’s a more intense and modern version of basic capitalism. The data points out how undemocratic it is.
It’s actually about who gets the power to make these decisions. Emma boils down the increasingly neoliberal method: austerity politicians deregulate and/or cut funding, and the private financial sector fills the gap with privatization. Nearly everything in our lives has private equity behind it, out to strip all value with no regard to long-term sustainability. Emma expresses the hope that politicians like Warren and Sanders can and will stop the Wall Street looting.
Steve and Emma then turn to the effects of austerity, from abandoned malls and virtual ghost towns to shorter, more brutish lives, not to mention an ever-bigger private debt bubble from payday and title loans that are death traps for the already suffering. The average family cannot afford a $400 emergency but are forced to turn to these predatory forms of credit.
Steve, as someone who suffered the ill effects of the recession, and Emma, a consumer rights attorney whose clients are working class and mostly people of color, discuss how we cannot simply talk about income inequality but must choose to reverse austerity and the neoliberal paradigm, and end the punishment of poverty.
Emma advocates increasing public investment, regulating private corporations and the financial industry. She supports the Loan Shark Prevention Act, putting a cap on interest rates. This regulation would counter any inflationary risks of the Green New Deal and Medicare For All.
Plans are not enough here; an organized, people-led movement is essential for any paradigm shift. Emma doesn’t trust “professional middle-class experts” to solve the problem, but instead focuses on community groups, agitation, organizing, and allying with labor. The movement needs to be people-powered, and groups like DSA are there to hand out the (metaphorical) torches and pitchforks.
Emma Caterine is a consumer rights attorney on the board of the Modern Money Network, a decades-long writer and advocate of economic justice, LGBTQIA+ racial and feminist justice movements – and a proud member of Democratic Socialists of America.
@EmmaCaterineDSA on Twitter
Sign the manifesto at jobguaranteenow.org/
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Steve’s guest, Emma Caterine, is a consumer rights attorney with special interest in predatory lenders, like loan sharks and payday loan companies. She begins by talking about credit as a social construct, To understand the Great Recession we must understand the difference between consumer debt, with a high risk of default, and federal spending, which is new money and can never default.
When our economy grows through private debt, it’s unsustainable and leads to crises like the Great Recession.
MMT economists like Wynn Godley, Stephanie Kelton, and L. Randall Wray have shown that the idea that public “debt” and the deficit are inherently evil and to be avoided at all costs, or that financial crises are caused by “imbalance in the economy” are all myths. What we see then is that cutting public spending — austerity — is a political choice.
She also asserts that private household debt and private corporate debt have similar consequences on different scales, though the households bear more of the burden. Private equity firms load companies with tons of debt to be serviced by cutting labor and selling real estate holdings, which is detrimental to surrounding local communities – people of color and the working poor in particular. This growth model based on private debt proves that lessons weren’t learnt from the Great Recession. It’s a more intense and modern version of basic capitalism. The data points out how undemocratic it is.
It’s actually about who gets the power to make these decisions. Emma boils down the increasingly neoliberal method: austerity politicians deregulate and/or cut funding, and the private financial sector fills the gap with privatization. Nearly everything in our lives has private equity behind it, out to strip all value with no regard to long-term sustainability. Emma expresses the hope that politicians like Warren and Sanders can and will stop the Wall Street looting.
Steve and Emma then turn to the effects of austerity, from abandoned malls and virtual ghost towns to shorter, more brutish lives, not to mention an ever-bigger private debt bubble from payday and title loans that are death traps for the already suffering. The average family cannot afford a $400 emergency but are forced to turn to these predatory forms of credit.
Steve, as someone who suffered the ill effects of the recession, and Emma, a consumer rights attorney whose clients are working class and mostly people of color, discuss how we cannot simply talk about income inequality but must choose to reverse austerity and the neoliberal paradigm, and end the punishment of poverty.
Emma advocates increasing public investment, regulating private corporations and the financial industry. She supports the Loan Shark Prevention Act, putting a cap on interest rates. This regulation would counter any inflationary risks of the Green New Deal and Medicare For All.
Plans are not enough here; an organized, people-led movement is essential for any paradigm shift. Emma doesn’t trust “professional middle-class experts” to solve the problem, but instead focuses on community groups, agitation, organizing, and allying with labor. The movement needs to be people-powered, and groups like DSA are there to hand out the (metaphorical) torches and pitchforks.
Emma Caterine is a consumer rights attorney on the board of the Modern Money Network, a decades-long writer and advocate of economic justice, LGBTQIA+ racial and feminist justice movements – and a proud member of Democratic Socialists of America.
@EmmaCaterineDSA on Twitter
Sign the manifesto at jobguaranteenow.org/
Coming Soon
Episode 110 - Taming the Megabanks with Art Wilmarth
Episode 109 - Institutions with Linwood Tauheed
Episode 108 - Knowledge is Power with Rev. Delman Coates
Episode 107 - We Are Losing the Media War with Jordan Chariton
Episode 106 - Reform or Revolution with Danny Haiphong
Episode 105 - The Case for Scottish Independence with Kairin Van Sweeden
Episode 104 - Focus on the Family with June Carbone
Episode 103 - Anatomy of a Job Guarantee with Fadhel Kaboub
Episode 102 - The Global Scourge of Neoliberalism with Patricia Pino
Episode 101 - Beat Back Better: Organizing in 2021 with Emma Caterine
Episode 100 - Flying with Sara Nelson
Episode 99 - A Modern Debt Jubilee with Steve Keen
Episode 98 - Imminent Collapse with L. Randall Wray
Episode 97 - Solidarity with Joe Burns
Episode 96 - Treasury's Gift To The Fed with Robert Hockett
Episode 95 - The Land Value Tax with Joshua Vincent and Rich Nymoen
Episode 94 - Political Sobriety with Rohan Grey
Episode 93 - The Public Banking Act with Rohan Grey
Episode 92 - Propaganda and the Vortex of Centrism with Esha Krishnaswamy
Episode 91 - Crisis Management with Warren Mosler
Episode 90 - The MMT Sequence with Warren Mosler
Episode 89 - Juxtapositions with Bill Mitchell
Episode 88 - Debt Deflation and the Neofeudal Empire with Michael Hudson
Episode 87 - A Just Transition Through Participatory Governance with Cindy Banyai
Episode 86 - 2020 with Margaret Kimberley
Episode 85 - Shadow Banking with Robert Hockett
Episode 84 - African Sovereignty and a Global Green New Deal with Fadhel Kaboub
Episode 83 - Mutual Credit and the War on Cash with Brett Scott
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