Written by John Lounsbury
Michael Hudson on the Rentier Economy
Michael Hudson argues that the increased financialization of capitalist economies is driving these societies toward collapse. Leading up to the collapse, Prof. Hudson says wealth and incomes become more and more polarised until the result becomes ultimately unsustainable. He says that the advancement of capitalism was supposed to be a movement away from feudalism. Instead we are now moving back toward feudalism.
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From YouTube:
Allied with landlords and monopolists, the finance sector is extracting economic rents from the economy that’s impoverishing US government, industry and labor says Michael Hudson discussing the chokehold of pro-finance, pro-rentier capitalism reaching into the present COVID-19 crisis.
From Wikipedia:
Michael Hudson (born March 14, 1939) is an American economist, Professor of Economics at the University of Missouri – Kansas City and a researcher at the Levy Economics Institute at Bard College, former Wall Street analyst, political consultant, commentator and journalist.
Hudson graduated from the University of Chicago (B.A., 1959) and New York University (MA, 1965, PhD, 1968) and worked as a balance of payment economist in Chase Manhattan Bank (1964 – 1968). He was assistant professor of economics at the New School for Social Research (1969 – 1972) and worked for various governmental and non-governmental organizations as an economic consultant (1980s – 1990s). [2]
Hudson has extensively studied economic theories of many schools, including Physiocracy, classical political economy (Adam Smith, David Ricardo and Karl Marx, among others), neoclassical, Keynesian, post-Keynesian, Modern Monetary Theory and many others. He identifies himself as a classical economist. His interpretation of Marx is almost unique to him and differs from major Marxists.
Hudson devoted his entire scientific career to the study of debt, both domestic (loans, mortgages and interest payments) and external. In his works, he consistently advocates the idea that loans and exponentially growing debts that outstrip profits from the economy of the real sphere are disastrous for both the government and the people of the borrowing state as they wash money (going to payments to usurers and rentiers) from turnover, not leaving them to buy goods and services and thus lead to debt deflation of the economy. Hudson notes that the existing economic theory (the Chicago School in particular) is in the service of rentiers and financiers and has developed a special language designed to create the impression that the current status quo has no alternative. In a false theory, the parasitic encumbrances of a real economy, instead of being deducted in accounting, add up as an addition to the gross domestic product and are presented as productive. Hudson sees consumer protection, state support of infrastructure projects and taxation of parasitic rentier sectors of the economy instead of taxing workers as a continuation of the line of classical economists today.
This video is 41 minutes long.
Source: YouTube
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