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IOW a small country can have its own currency but if it does not exercise strict control over capital flow and abnegates its supervision over banking and the business sector in general it can still be raped by much larger players via unfavorable terms of trade imposed on it  through the intellectual hegemony of neo-liberal macroeconomics in the 'global' economy. And if they successfully isolate themselves from those consequences they become 'pariah states' vulnerable to covert intervention and destabilization. Three sector national accounting can show how countries can be sucked dry by balance of trade problems.

MMT is coherent but it does not insure good outcomes regardless of geopolitics. And neo-liberal macroeconomics is bullshit but economic incumbency and institutional capture insure its continued dominance. But the problems are only magnified when most continue to labor under the illusion that present policies work for any but a tiny few. Best to grow powerful by feeding on the helpless in foreign countries before turning your system relentlessly on the citizens of the countries out of which you operate.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Sun May 5th, 2013 at 03:24:36 PM EST
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