Episodes

  • Can Europe be Draghi-ed out of stagnation?

    Can Europe be Draghi-ed out of stagnation?
    Nov 27 2024
    You’ll know the name Mario Draghi. He was the President of the European Central Bank and, for a short while, Prime Minister of Italy. Earlier this year he produced a report EU Competitiveness. It called on the need for more Europe-wide investment, particularly for innovation, emerging industries and the transition to green energy. Phil and Steve talk through the ideas and the challenges they present to the structure of the EU. Are the challenges insurmountable? Is that why Draghi’s plan already seems to have been lost at the back of the bookshelf. There is one competitive edge of Europe though. Steve says if the US successful cuts government spending by the touted $2 trillion, that’s money pulled out of their economy. If Europe was to take the opposite tack, it could tip th balance in its favour Particularly, suggests Phil, if the extra public money is spent building Europe-based AI data centres to challenge the US dominance in this rapidly growing sector.

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    40 mins
  • Tariffic Trump

    Tariffic Trump
    Nov 20 2024
    At least half of America is elated with its new choice of President. Money is already flowing into the country, with early gains on the NYSE and the dollar shooting higher in value. Tariffs will be front and centre early in the new Presidency, with Trump describing Tariffs as “a beautiful word” recently. But will it have the intended effect. Could the strength in the dollar wipe out any of the benefits from domestic production? Will higher tariffs add to the cost and drive inflation? Does America have the skills base to manage the onshoring of so much productive capacity? Phil Dobbie and Steve Keen discuss what will happen next in America.

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    40 mins
  • Milking inheritance

    Milking inheritance
    Nov 13 2024
    The UK Labour party seems top have scored another own goal, with their inheritance tax on family farms. Previously farms were exe pt from inheritance, but that meant wealthy landowners, with massive stately homes set in sprawling estates could buy a few sheep and claim they were a farm. Hence, the government limited the exemption to properties worth less than £1 million, a threshold which Steve Keen suggests is well below a realistic level. Thresholds should only be there for th every rich, which is the US approach to inheritance. This week Phil and Steve look at ways of managing inheritance and ask whether there are better ways of ensuring we don’t see intergenerational wealth getting out of control.

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    39 mins
  • The economics of irresponsibility

    The economics of irresponsibility
    Nov 6 2024
    The classical economic assumption, from the days of Adam Smith, is that we all have free will and this freedom ensures the best possible outcomes for the economy, provided those decisions are based on greed and self-interest. This week’s episode opens with a student questioning Milton Friedman about the freedom of a man who couldn’t afford to pay his electric bill, so the power company cut him off and he died. Friedman says the fault lies with friends and neighbours who didn’t step in to support him. Perhaps they were too busy acting in their own self-interest. In a far-reaching discussion Phil asks Steve whether this is a failing of economics – and, if decisions can’t be made by free-will, who makes them?

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    39 mins
  • Britain’s capex crisis and how to fix it

    Britain’s capex crisis and how to fix it
    Oct 30 2024

    Ever wondered why Britain’s roads are riddled with potholes, why the trains keep breaking down and why there aren’t enough hospital beds? Simple. Britain is not making enough capital investments. Taking the public and private sector together, it amounts to about 6 percent of GDP, well below the 22% in the US - which has its own infrastructure problems. China can spend as much as 40% of GDP on capex projects.


    Steve says there are two reasons why Berit5ian’s infrastructure is failing. First, not enough engineers. There needs to be more teaching of STEM subjects in schools. But more importantly the adherence to the notion that governments need to balance budgets means capex investment is often pushed aside by more pressing short-term spending. Phil asks whether the sensible way forward is to allocate an amount of money for capex investment that sits outside the budget that the government tries to balance each year.


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    46 mins
  • Co-ops change the game

    Co-ops change the game
    Oct 23 2024

    Steve Keen says he builds his economic model based on the motivation of three types of actors. First, the worker, who wants to maximise his or her wage. Then there’s the capitalist who wants to maximise profits. And the financiers who wants to lend out as much money as possible with the best possible returns.


    How does Steve’s model change if most businesses became cooperatives. Workers would also become shareholders, also wanting to see strong profits. They might also have other considerations, such as working conditions, which will impinge on the returns won by the capitalists. Financiers might lose out as the cooperatives seek to reinvest their funds in new lines of business.


    This week Phil and Steve examine how co=operatives change the model of the capitalist system and ask why we don’t see more of them.


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    32 mins
  • The cycles of the economy

    The cycles of the economy
    Oct 16 2024

    What causes an economy to fall from a peak? Many economists will argue it’s exogenous shocks but, as Phil and Steve discuss, there’s not too many of those around. Maybe COVID was one, but even that came about because our economic system has drawn us closer to wildlife habitats.


    Or is it a lack of resources? We run out of capacity to produce more, whether it’s factories, people or natural resources, like fossil fuels. Does the shortage relative to demand force prices up and its inflation that ultimately kills growth.


    No, says Steve. Karl Marx had it right when he postulated that the rising pressure on wages will cut the profit that capitalists thought they would be earning, which would mean they cut investment. Talk about cutting off your nose to spite your face.


    So, if that’s how economies peak, what is it that pulls hem out of a trough? And is there anything we can do to minimise the impact of business cycles, or are they simply the natural order of things?


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    37 mins
  • The War Dividend

    The War Dividend
    Oct 9 2024
    It’s a sad fact that war can pay. The US arms industry is one major beneficiary. The UK is a long way behind, but it also a big supplier of armaments to the world. If governments of the world upped their defence pending to 3 percent of GDP that would see a massive increase in demand for weaponry. In Britian’s case it could re-engage the manufacturing sector and maybe even lead Britain back to a trade surplus. Phil asks Steve why we seem happy to see government spending on defence, supporting growth in the private sector. What a shame we don’t apply the same logic to helping other sectors grow – sectors that don’t involve killing people.

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    37 mins