PERSPECTIVES

Economic & Political Weekly EPW may 11, 2013 vol xlviII no 19 35
Climate Change of Another Kind
Amit Bhaduri
This is a thoroughly revised and extended
version of a paper written originally for a
conference in Poland to honour the memory of
Michael Kalecki and published in The Economic
and Labour Relations Review, 23(3), pp 3-12
(Australia) at the request of Geoffrey Harcourt.
Amit Bahduri (amit.bhaduri@gmail.com) is a
distinguished macroeconomic theorist and a
staunch critic of corporate-led growth
strategies and developmental terrorism.
Changes in the climate of
economic policy affect more
directly and immediately our
everyday life compared to
changes in the global physical
climate. And, yet, while physical
climate change receives a good
deal of attention and research,
economic climate change is
seldom noticed and rarely
commented upon. The sustained
attack on Keynesian demand
management in the name of
sound nance has
re-established the dominance of
nance capital the world over,
except in a few Latin American
countries where social democracy
has forced its way into policy in a
new guise. Indias subservience to
Washington and to global nance
is shameful because even as its
economy has done well on the
growth front, the people have not.
L
ike vegetation that changes with
climatic conditions, economic poli-
cies too change with the climate.
But it is a different kind of climate the
climate of economic opinion. Both are con-
sequences of industrialism, particularly
the idea of rapid industrialisation as an
unavoidable component of economic
development. Nevertheless, there is an
important difference. Changes in the
climate of economic policy affect more
directly and immediately our everyday
life compared to changes in the global
physical climate. And yet, while physical
climate change receives a good deal of
attention and research, economic climate
change is seldom noticed and rarely com-
mented upon. This is hardly surprising.
Since the change in the climate of eco-
nomic opinion is usually brought about by
governments, a sufciently pliable media
beholden to them, and their equally pliable
economic experts who become inuential
by virtue of proximity to political power
and inuence, changes in the climate of
policy are orchestrated and presented to
the public as necessary reforms, indeed
compulsions of the day. The changes can
then go largely unopposed under the syn-
drome of There Is No Alternative (TINA).
Things are more apparent when
poli tical power is heavily concentrated.
Fascism required state power to be under
the control of big business; ofcial com-
munism wanted it under the dictator-
ship of the proletariat (read the Com-
munist Party). Between these extremes
lies the spectrum of liberal democracies
which come in a bewildering variety,
from social democracy to the stance of a
minimalist state and free market.
Nonetheless they all remain capitalist
democracies, rejecting neither capita lism
nor political democracy but chan ging the
denition according to the requirements
of maintaining power. One common
underlying presumption that gives them
widespread political legitimacy is the
assumed neutrality of the democratic
state to balance conicting interests of
contending classes and gro ups under
capitalism. Even Hitler pursued populist
measures for full employment until his
grip on power was secure. In less extreme
cases, the game of liberal democracy is
played with the state as the referee which
lets the fortune of conicting class inter-
ests uctuate within limits manageable
by capitalist institutions of law, property,
the bureaucracy and so forth. Like a
pendulum the function of these institu-
tions is to let class fortunes swing, but the
swing will be calibrated to avoid danger-
ous extremes. Thus the logic of the market
that depends on one dollar, one vote is
combined with political democracy of
one adult, one vote even in countries
that have a vast majority of very poor
and a few awfully rich. The two coexist in
a market democracy because extremes
are institutionally forbidden spaces.
Demand Management
and Class Power
The theory of demand management in
capitalist democracies was developed on
this assumption of relative neutrality of
the state. The theory is associated with
the name of the British economist John
Maynard Keynes, although it was formu-
lated independently around the same
time by the Polish economist Michael
Kalecki. The theory in a sufciently vul-
garised form became conventional wis-
dom for statecraft (We are all Keyne-
sians now remarked former US presi-
dent Richard Nixon) and reappears in its
present guise under the name of stimulus
package. The theory says that a high
level of economic activity, output and
employment can be maintained by the
government by keeping aggregate de-
mand at a sufciently high level, when-
ever necessary through government
spending nanced by budget decit or
borrowing. The political implication of
the theory is remarkable for capitalism.
High output and employment would
benet both the classes employers and
employees. High prot would result from
high capacity utilisation and a larger
volume of sales and, workers can expect
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may 11, 2013 vol xlviII no 19 EPW Economic & Political Weekly 36
a larger wage bill and easy availability of
jobs at high employment. It looks like a
recipe for cooperative rather than con-
ictive capitalism, the ideal setting for
class harmony in a liberal democracy.
However, the two economists who had
formulated independently the same theory
of demand management differed radically,
not about its logic but about the future
political prospect of their theory. Keynes,
with all his advantages of Cambridge and
class, had come to save capitalism not to
bury it. Kalecki, a Polish Jew and a refugee
escaping from the lengthening shadow of
Nazi Germany over Europe was acutely
aware of the monstrosities capitalism
was capable of producing in the service
of capital Imperialism, Fascism and
Nazism. With little illusion about capi-
talism Kalecki foresaw the political fra-
gility of the ass umption of a neutral
state pursuing even-handed economic
policies to nurture class cooperation. As
early as in 1943, he claimed that the
theory of demand management would
falter, not on its logic but on its politics.
1
Economic theory never rules by logic
but by convenience of acceptability to the
powers that be. Even before the theory
of demand management had gained aca-
demic respectability, demand management
policies were practised as populist meas-
ures, starting with a massive motor way
(autobahn) construction pro gramme in
Nazi Germany as a prelude to setting up its
war machinery. In comparison Roosevelts
much publicised New Deal in the United
States (US) remai ned a feeble attempt (the
decit hardly exceeded 5% of gross do-
mestic product between 1934 and 1938,
returning to scal retren chment by 1938);
other capitalist demo cracies were even
slower to learn. The oppo sition to govern-
ment spending nan ced by a decit faded
under the threat of war, and war time
Keynesianism maintained full employ-
ment, but only at an enormous cost of
shifting resources from civilian to military
production. Demand management through
war expenditure may be more dangerous
than digging holes in the ground to ll
them up for creating demand but rem-
ains an abiding attraction due to the inte-
rests of the military industrial complex.
Nevertheless, in the absence of control-
led experiments of the physical sciences,
the experience of war economies came
closest to conrming the validity of the
proposition that demand management
by the government can sustain full em-
ployment. If actual war was needed to
establish the theory, the cold war years
saw Keynesian theory gradually gaining
wider acceptance in ofcial circles. As
usual, politics rather than economics
became the more compelling reason. The
cold war meant a competition between
the two systems of market capitalism and
centrally-controlled Soviet socialism.
Despite its many weaknesses, the latter
had warded off successfully the Great
Depre ssion of the 1930s and, maintained
full employment throughout. Its attraction
was strong enough for working people in
capitalist democracies for the state to
look for remedial actions. And, this com-
petition between the two systems about
the welfare of their ordinary citizens
contributed to the wide political accept-
ance of the welfare state with Keynesian
demand management as its rationale.
For some quarter century after the
second world war (until about the rst
oil price shock of 1973), long years of
capitalist prosperity followed. It was a
period of almost uninterrupted high em-
ployment and growth accompanied by
unprecedented rising living standards of
working people. Scandinavian social
demo cracies had already set the standard.
As the Swedish economist Ohlin had
clai med, the objective of social demo-
cracies was socialisation of consump-
tion, not of production. This is wage-led
gro wth, with wage dened in a broader
sense to include the social wage of
health, education, old age insurance, etc.
Nevertheless, maintaining high employ-
ment and social consumption required
state intervention in production on a
larger scale with a budget decit and
nationalisation of several industries es-
pecially public utilities like basic health
and education services. For ordinary
citi zens this was the golden age of
capita lism; but not so for the captains of
industry. Their authority over the econo-
my was gradually eroding, as workers
indiscipline in the form of higher wage
claims was rising in a tight labour market
(especially in England and Italy in the
1960s and early 1970s propelled by a
strong trade union movement) and the
fear of job-loss was losing potency.
It was not revolutionary, but transforma-
tive politics within the capitalist frame-
work insofar as it reduced drastically the
role of capitalists with the rising power of
trade unions on the one hand, and the
ability of the state to maintain continuous
full-employment relatively independently
of the capitalist class on the other. The
calibrated sham politics of electoral
democracy where the party in power
changes with nothing really changing was
giving way to the real politics of decisive
shift in class power in the economy.
In the Name of Sound Finance
A concerted attack on demand manage-
ment by a proactive state for maintain-
ing full employment had to come from
the capitalists. It started and still contin-
ues in the name of sound nance. The
social function of the doctrine of sound
nance, Kalecki wrote as early as in 1943,
is to make the level of employment de-
pendent on the state of condence.
2
The
climate for economic policy had to take a
U-turn and change from pro- labour wage-
led to pro-capitalist private prot-led
growth. This required curbing independ-
ent economic power to a relatively neutral
state and making its policies sufciently
pliable for strengthening the state of con-
dence of private capital for investment.
Academic economists always at the
service of the powerful and, never too
unwilling to pick up a few easy bucks
through consultancy, prestigious profes-
sorships and even Nobel prizes given out
by the Bank of Sweden followed enthusi-
astically. They argued that it is irrespon-
sible scal behaviour to take recourse to a
budget decit even in times of recession.
The new mantra was about tracking the
scal decit but not employment, lon-
gevity or any other index of welfare of the
citizens. Modern high theory powe red
by a lot of algebra provided the smoke-
screen. It assumed that the capitalist so-
ciety behaves like a single optimising in-
dividual over time with formidable fore-
sight and stretched this false analogy
between the individual and the society
by hiding both the conicts of a class-
divided society emphasised by Marx
and the circular ow of income and
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Economic & Political Weekly EPW may 11, 2013 vol xlviII no 19 37
expenditure emphasised by Kalecki and
Keynes that breaks the ana logy of in-
come determination between the indi-
vidual and the society. The nan cial
market was seen as the most efcient
information processing institution in
which nobody had the power to manip-
ulate information. The myth of a rational
and efcient market replaced the dubi-
ous assumption of a neutral state.
In this mythical market economy,
governments are actually an unneces-
sary appendage except perhaps to main-
tain law and order if the poor get out of
hand. Government debt is simply a bur-
den on future generations who have to
pay back just like the individual. Keyne-
sian theory which had pointedly empha-
sised that in situations of excess produc-
tive capacity and serious unemployment,
providing productive employment would
expand the current production of the so-
ciety to nance at least part of the decit
without ination and, the state can con-
tinue to service its debt through issuing
new bonds and renancing partly its
outstanding debt until the recession re-
cedes has no place in a theory that is
based on an analogy between a capital-
ist society and a rational individual. The
analogy with the individual who is pre-
sumably fully employed so that the op-
portunity cost of his or her engagement
in alternative activities can be calculat-
ed shifted attention from full employ-
ment to efcient resource allocation.
Theory for decades has been busy with
the problem of efcient allocation of
scarce resources ignoring the problem
under its nose that labour as a resource
often remains grossly underemployed.
Distributive Justice
The notion of distributive justice also
changes in a capitalist democracy when
improving the investment climate for
private capital becomes the main focus of
policy. Normally, aggregate demand in-
creases through redistribution in fav our of
the poor because they consume more
out of their income than the rich. Never-
theless, redistribution in favour of the
poor and measures to expand social con-
sumption and subsidies for the poor -
nanced by progressive tax rates on income
and wealth are opposed on the ground
that they are detrimental to creating the
right climate for private investment. A
typical justication offered is the alleged
inefciency of the state in delivering
services to the poor. The failure of the
state to deliver services efciently and
without corruption is not faced as a po-
litical or administrative problem; instead it
is pretended to have an economic solution
through leaving it the magic of the mar-
ketplace. Naturally it has to be overlooked
that replacing the state by the market
mechanism is loaded in favour of the rich
as it rations out the poor through higher
prices even of basic services like water,
housing and health. Privatisation (and its
recent model of public-private partner-
ship) is needed not to improve democratic
functioning by making the state and
public action politically accountable to the
citizens in a democracy, but to dodge it
by expanding the space for private prot.
Increasingly, abandoning redistribution
in favour of the poor, the opposite route
is taken in the name of demand manage-
ment. Holding the traditional theory of
demand management hostage to the in-
terests of the capitalist class, it suggests
that the rich should have even higher in-
come though the generosity of the scal
and monetary policies of the state so that
they have stronger incentives to invest.
This means cutting taxes for the high in-
come brackets, reducing wealth and cor-
porate tax and, whenever possible gen-
erating articially asset market and real
estate booms. In a favourable invest-
ment climate, the rich would invest their
excess funds in nancial assets to make
more capital gains and keep the asset
market boom going. As the rich become
wealthier, they can borrow more against
their increasing wealth, and spend more to
increase aggregate demand. The aggres-
sive assault of this private prot-led growth
hopes to compensate for the reduction in
aggregate demand from redistribution
against the poorer classes (who have
higher consumption propensity) by higher
private investment from the rich who
are made richer through state policy to
improve the climate for investment.
3

Globalisation adds new dimensions by
increasing the relative importance of the
external in relation to the domestic market.
Opening up economies means domestic
demand management would be less effec-
tive, especially in those economies which
are highly import dependent because a
signicant part of the demand generated
would leak out in the form of import de-
mand. This places economies with lower
international competitiveness at a double
disadvantage. On the one hand, they are
less able to manage effectively the level of
demand at home; on the other, they are
able to sustain openness in trade by accu-
mulating the decit as growing foreign
debt. This provides greater scope for inter-
national capital ows to make the exchange
rate and the stock markets more vulnera-
ble to capital ights. Unrestricted economic
openness for an internationally less-com-
petitive country becomes a recipe of
growing indebtedness and shrinking do-
mestic demand. So the policy prescription
follows: countries should enhance their
inter national competitiveness with the
objective of achieving export-led growth.
Paradoxically, it is a policy supposed
to be relevant in a globalised setting and
yet, it is fallacious precisely in that set-
ting. Not all countries can achieve an ex-
port surplus at the same time; for every
gainer from such strategy there must be
losers who continue to accumulate sov-
ereign debt. However, this expands the
market not for goods and services, but
for global nance. At the same time,
obse ssion with international competi-
tiveness requires giving large corpora-
tions a free hand as they are best placed
to take advantage of the international
market through their production and
distribution networks. Competitiveness in
the international market usually has two
aspects having a technological edge or
niche and being cost competitive. Cost
competitiveness, measured by unit cost,
requires higher labour productivity and
lower wages. Higher labour productivity
without a corresponding increase in wage
has the potential of increasing the prot
margin per unit of sale without neces-
sarily enhancing price competitiveness.
Although the link between wage and pro-
ductivity increase (or an inco mes policy)
was institutiona lised as a further aspect
of cooperative capitalism in some Euro-
pean countries (e g, in social partnership
in Austria, social market economy in
Germany) they face increasing strain like
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may 11, 2013 vol xlviII no 19 EPW Economic & Political Weekly 38
outsour cing under the pressure of main-
taining international competitiveness.
While foot loose multinational corpora-
tions restrain wages by outsourcing or
shifting locations to lower wage, lower
tax countries, they increase labour pro-
ductivity thro ugh shedding labour by
mechanisation and robo tics. Neither
employment nor wage grows adequately
even in countries that succeed in being
export surplus, while countries are com-
pelled to join a race to the bottom in
terms of concession in tax policies and
labour laws to nurture a more favourable
climate for corporate investments.
Finance Capital in Command
Making sure that capitalists remain in
command in democracies has been a bal-
ancing game played in earnest at least
since universal suffrage. The game is
played in different circumstances, but the
outcome has to be ensured that capitalist
democracies remain capitalist rst and
democratic next. Although capitalism is
well entrenched and the challenge from
any alternative system is not in sight (with
the Soviet Union collapsing and China be-
having holier than the Pope), a muta-
tion in the evolution of global capitalism
has taken place, paradoxically through
globalisation itself. It was meant to extend
the global reach of nancial capital from
the mid-1970s thr ough the deregulation of
the capital markets of major industrialised
nations (of the Organisation for Economic
Co operation and Development).
The process was roughly completed by
early 1980s and unleashed massive private
funds moving across national boundaries
with electronic speed. The total foreign
exchange required for trade and foreign
investment today accounts for less than
4% of the massive daily volume of turnover
in the foreign exchange market. The rest
of the nancial turnover goes in various
paper assets including over the counter
derivatives and securitised loans as
probably the biggest items. The present
phase of globalisation is increasingly
about the openness of economies to the
free ow of nance; it is much more
about nancial openness than about
free trade or foreign direct investment in
goods and services, and this leads to a
fundamental shift in the centre of power.
Acquiring a commanding position in
the capitalist economy lies increasingly
through nance. This has changed poli-
cies for promoting the investment cli-
mate in at least two ways. Since a cur-
rency or stock market can be set on a
downward spiral through capital ight
with devastating consequences for the
investment climate of a country, nance
capital wields power as never before.
Manufacturing industries have a subser-
vient position in this scheme because,
achieving export or industrial competi-
tiveness operates on a considerably longer
time scale compared to the ability of
nance capital to change the exchange
rate or asset prices through short-term
capital ows. Its immediate victim is
demand management by any individual
country in isolation as capital can vote
with its feet and y out in protest against
expansionist economic policies and upset
almost overnight the investment climate
of a country. And developing countries
with liberalised capital markets (capital
account convertibility) remain especially
vulnerable. Consequently the race to the
bottom to attract capital ows is the nat-
ural outcome with success indicated by
ability to attract foreign direct investment.
However, whether policies of a natio nal
governments are sufciently hospitable
to nance capital is decided by a few
leading nancial institutions. In develop-
ing countries it used to be the World
Bank and the International Monetary
Fund (IMF); in developed capitalist coun-
tries private credit rating agencies rated
the securities and credits of corporations.
As the reach of nance became increas-
ingly global, those private credit rating
agencies became the game changers.
Today it is a private credit agency like
Standard and Poors or Moodys Investor
Service which through its rating of the
investment climate and sovereign risk of
a country rates, in effect, the quality of its
government, its democracy. Capitalist de-
mocracies have come full circle thro ugh
the dominance of private nance. Man-
agement of the investment climate is in-
creasingly done through the virtual rather
than the real economy, creating articial
nancial asset and housing mar ket bub-
bles, increased inequality in the real
eco nomy caused by scal and mone tary
concessions to the rich, withdrawal of
welfare measures from the poor, and
slow growth of employment and wages
as a consequence of dangerous obsession
with international competitiveness and
growth of output rather than employment.
The interest of the real and the virtual
economy is reconciled through articial
bubbles, as the negative impact of grow-
ing inequality on aggregate demand in the
real economy is alleviated by asset price
boom in the virtual economy. It continues
for a while driven by a mechanism of pos-
itive feedback between rising asset price
creating even higher demand for assets, a
self-sustaining process of mutual rein-
forcement so long as it lasts. And yet, when
the bubble of rising asset prices bursts, it
throws up an old question, the question
of how to reconcile a growing tension be-
tween industry and nance. After Britain
returned hurriedly to the Gold Standard
in 1925, Winston Churchill observed,
the Governor (of the Bank of England)
shows himself perfectly happy in the spectacle
of Britain possessing the nest credit rating in
the world simultaneously with a million and a
quarter unemployed... I would rather see -
nance less proud and Industry more content.
4
As a sequel to this, Josef Steindl, one
of Kaleckis most distinguished colleagues
reminds us:
Kalecki used to interpret the events in Britain
around 1931-32 in terms of a shift of power
from the City (Finance) to Industry. The inter-
est of the City was overruled by abandoning
the Gold StandardWith this tarnishing of
the inter national image of the City, the centre
of gravity of economic policy shifted to the
home front in favour of domestic industries.
This provided the necessary socio-political
base for the acceptance of Keynesian policies.
5

Finance Triumphs
And yet history turns out to be more
cunning in defying logically derived
predictions because the outcome is deter-
mined by unforeseen changing balance of
power over time. Finance has continued to
be the winner in this power game irre-
spective of the state of the real economy.
With massive bail-outs to nancial insti-
tutions in various forms, rst the US gov-
ernment and now (2012) Germany tries to
save Finance in the eurozone from a crisis,
but without corresponding measures to
save Industry and employment in the real
economy. So long as the supremacy of
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Economic & Political Weekly EPW may 11, 2013 vol xlviII no 19 39
Finance remains the overriding objec-
tive of economic policy, intelligent de-
mand management policies along Keyne-
sian lines can have no place in the politi-
cal scheme even if Finance produces un-
sustainable and intangible ctitious
commodities in the form of claims on
underlying real commodities. But it is
the real economy that produces tangible
goods and services as the foundational
base upon which not only elaborate -
nancial structures are built, but the wel-
fare of ordinary citizens depends. Elevat-
ing Finance to a commanding height by
neglecting the underlying base of the real
economy can only open up new fault
lines that are capable of shaking the very
foundations of capitalist democracies.
Social Democracy in a New Guise
Climate change affects the whole planet.
The effect is global but not uniform.
And, climate change in economic poli-
cies has recently produced a strange
spectacle. The global superpower that is
mostly responsible for the global crisis
continues to set the agenda and, most
developing countries continue not only
to accept but increase their dependence
on that same power. Like the slave that
knows nothing better than helpless de-
pendence on the master, many develop-
ing countries stick to the US fearing the
unknown. There are notable exceptions;
indeed, many countries of Latin America
that used to be the backyard of the US
have reduced their dependence based on
the idea of a relatively neutral state in a
genuine social democracy that must help
the weakest sections of its population.
In that sense many aspects of earlier
social democracy are back but in a new
guise. For instance, Latin American coun-
tries such as Argentina, Bolivia, Brazil,
Equator and Venezuela show far greater
concern for their environment and less
of mindless industrialism, especially how
to share the benets of natural resources
which helps the local poor population. It
requires courage of conviction because it
annoys the superpower, reduces the prof-
its of multinationals. It is no surprise that
private credit rating agencies, the IMF
and the World Bank join and do their best
to downgrade the international credit
rating, even the quality of governance
and democracies in these countries be-
cause their economic and political cli-
mate do not follow the agenda set by the
US. Different too are China, Iran or North
Korea who question US hege mony in dif-
ferent ways, but they seem to be driven
by motives of power and nationalism.
Indian Subservience
India prides itself as the worlds largest
democracy and seems to believe in sub-
servience as its ideology. This means
adopting a strategy of risk aversion for the
powerless like in a master-slave relation.
So, even though the conditions at home
are vastly different our similar ideological
stance imitates the US whenever possible,
ghting terror in a way dened by the US,
helping private corporations for develop-
ing the US style capitalism, accepting glo-
balisation unquestioningly particularly if
it suits the US interests, like in retail trade,
agricultural biotechnology, nuclear deals,
but foregoing possibilities of advanta-
geous oil deals with countries like Iran or
Venezuela.
The logic of subservience helped to
produce higher growth but cannot hide
our shame. India is emerging not as a
global power but a country emerging
with the largest number of illiterates,
most of the undernourished children and
anaemic mothers in the 21st century.
Even higher growth will not take away
this shame because the problem lies
elsewhere. Despite our impressive gro-
wth, until recently more than double the
world average and one of the highest in
the developing world (after China), India
had about one-fourth of the worlds poor
in 1980. Since then India has gradually
grown faster, but India today accounts
for 40% or two-fths of worlds poor, i e,
the rest of the world, including sub-
Saharan Africa, has reduced poverty faster
despite its lower growth. The short ans-
wer to this apparent paradox lies in the
way the government has tried to promote
growth by promoting private corpora-
tions at the cost of the poor in its attempt
to create the right investment climate.
The central component of this strategy
is allowing the loot by corporations of
natural resources, mostly common prop-
erty of the people like water, forests,
mountains, and coastlines with the active
connivance of the government which ac-
quires land in the name of public pur-
pose. As a result, we have produced a
strange spectacle of the number of dollar
billionaires growing phenomenally side
by side with inhuman poverty, both nur-
tured by deliberate policy-induced cor-
ruption to help both corporations who in
turn compensate handsomely the con-
cerned parties and politicians.
The recent coaleld allocation scam
involving the current prime minister is
probably the clearest example: the policy
favoured private at the cost of public cor-
porations by allocating at a very low
price presumably in the belief that this
would improve the investment climate by
bending existing regulations. Most cor-
porations simply sat on it in the hope of
selling off at much higher price, behav-
ing like rentiers rather than capitalists.
The state lost money, the nance minister,
economic pundits and the media regretted
loudly that the poor must sacrice more
for the development of the country by
accepting obligingly lower welfare bene-
ts, higher fuel price and more privatisa-
tion of essential services. And the gov-
ernment hopes to win the next election
fortied by corporate generosity through
kickbacks while it also knows that the
opposition has no better track record in
this respect in regions where they hold
power. This is the demo cracy which offers
people no real political choice in the name
of freedom to choose. At the same time it
outlaws, hunts and weighs down heavily
on any political tendency that tries to call
the bluff. This is the political climate cre-
ated in aid of corporate-propelled demo-
cracy that nurtures lovingly the invest-
ment climate for private corporations.
Notes
1 M Kalecki, Political Aspects of Full Employ-
ment (original 1943) in his Select Essays in the
Dynamics of the Capitalist Economy (Cambridge:
Cambridge University Press).
2 Ibid: 139.
3 For a convenient recent summary with analysis
see articles on the debate on Inequality, Im-
balance, Instability: Reections on a Structural
Crisis, Ashwani Saith, Development and Change:
Forum 2010-11, Vol 42, No 1, January 2011,
pp 70-261.
4 Minutes of 22 February 1925.
5 A Bhaduri and J Steindl, The Rise of Moneta rism
as a Social Doctrine in Post-Keynesian Economic
Theory edited by P Arestis and T Skouras
(Sussex: Wheatsheaf/Harvester), 1985, pp 57-58.