This is not a credit crisis

Bezemer, Dirk J (2009): This is not a credit crisis. Forthcoming in: Economic Affairs No. September

Abstract

Using an analogy with ancient Babylonia as its leading motive, this Viewpoint argues that the credit crisis is the symptom of an underlying problem. Fuelled by government policies, unprecedented debt levels were run up in industrialized countries over the last quarter century. Present policies of financial sector bailouts are not only unwise use of taxpayer’s money. They maintain economic structures opposed to what Classical liberals such as JS Mill envisaged as a free market economy.

• Item Type: MPRA Paper
• Language: English
• Keywords: credit crisis; debt; Babylonia; Mill; Liberalism
• Subjects: B - History of Economic Thought, Methodology, and Heterodox Approaches > B1 - History of Economic Thought through 1925 > B12 - Classical (includes Adam Smith); E - Macroeconomics and Monetary Economics > E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit > E51 - Money Supply ; Credit ; Money Multipliers; E - Macroeconomics and Monetary Economics > E4 - Money and Interest Rates > E44 - Financial Markets and the Macroeconomy; G - Financial Economics > G2 - Financial Institutions and Services > G28 - Government Policy and Regulation; A - General Economics and Teaching > A1 - General Economics > A11 - Role of Economics ; Role of Economists ; Market for Economists

References

BEA (2009) Data from the Bureau of Economic Analysis at http://www.bea.gov. Accessed March 2009

BIS (2009) Data from the Bank for International Settlements at http://www.bis.org. Accessed Marc h 2009

Hudson, M and M vd Mieroop, eds. (2002) Debt and Economic Renewal in the Ancient Near East. Baltimore: CDL Press

Hudson, M and C Wunsch, eds. (2004) Creating Economic Order: Record-Keeping, Standardizations, and the Development of Accounting in the Ancient Near East. Baltimore: CDL Press

Mill, JS (1844), Essays On Some Unsettled Questions of Political Economy, Essay IV: On Profits, and Interest. At http://www.econlib.org/library/Mill/mlUQP.html

Mill, JS (1848), The Principles Of Political Economy: With Some Of Their Applications To Social Philosophy, Book I, Chapter 4: Of Capital. At http://www.econlib.org/library/Mill/mlP4.html#Bk.I,Ch.IV

Wray (2004) (ed.) Credit and Sate Theories of Money: the Contributions of Michael Innes Cheltenham UK: Edward Elgar