Steve Keen announces Senate run

Heterodox economist Professor Steve Keen has announced that he will run for the Senate in the upcoming federal election:

Details from Bloomberg:

Keen will be a senate candidate for the New Liberals and says he wants to revive the economic golden era of Robert Menzies, who was prime minister for a record stint from 1949-1966. The present ruling Liberal Party, originally founded by Menzies, is now dominated by “reactionaries” and is a shadow of its former self, Keen said this week.

His priorities for the party’s economic platform:

  • Run a budget deficit of 3-4% of GDP — similar to Menzies — to pay for spending via MMT. The theory holds that governments with their own currency are unable to go broke and can therefore keep spending until inflation becomes a problem. Keen notes that inflation is so weak these days that it’s barely an issue.
  • Housing: Keen argues soaring property prices are a product of ever-rising mortgage debt. His goal would be to reduce the amount available for borrowing for a purchase to, say, 10-times the annual rental income of a property, although he wouldn’t do this immediately as that would crash the housing market.
    • The aim is to lower home prices without reducing household equity. For example, if someone had a property with a sale price of A$1 million ($725,000) and a mortgage of A$600,000, Keen would aim to cut the price by 20% to A$800,000 and cut the loan to A$400,000, thereby maintaining the homeowner’s A$400,000 equity. This would be financed through budget deficits/MMT.
  • For the Reserve Bank of Australia, Keen wants to introduce a central bank digital currency that would give everyone a digital account at the RBA. He would demand RBA officials “up their thinking” beyond standard neoclassical textbooks. They should be more like the Bank of England, whose research department, he says, agrees with his view that mainstream economics is wrong about banking.
  • On free trade, Keen says the specialization argument that has dominated modern economic policy has resulted is Australia going backwards in industrial complexity. It needs to rebuild its industry, he says, and this would be the main focus of trade policy.
    • That’s a lesson from the pandemic, according to Keen, which showed that Australia couldn’t make the masks, ventilators, or the other things it should have as a domestic capability.
  • On jobs, Keen would push for genuine full employment, in the Menzies mold, noting the jobless rate hit 1.5% in that era. He would also introduce something resembling a basic income, saying the sums provided to the unemployed and others on welfare are “appallingly low.” This would also be financed by the budget/MMT.

Nothing on immigration, unfortunately.

Nevertheless, we wish Keen luck. Australia needs more independent thinkers in parliament to challenge the failing Lib/Lab cartel.

Unconventional Economist

Comments

  1. He’s got my vote

    Well it might be perfect timing to implement his QE to the people

    Think KEEN is wrong on inflation

    Tell him to get his head out of the theory books & ask industry

    He’s too late anyway, should have been done 8/9 yrs ago

      • Camden HavenMEMBER

        Yep, Chyna is going to show us that to fixt this housing issue only a mega bust can work.
        The truth at this point is not going to win a Senate seat

  2. I thought the New Liberals had to change their name after that recent legislative change to screw the micro parties.

  3. If he is pushing for full employment then by definition he will be looking to reduce immigration rates etc, no ?

  4. MB consistently backing the “right” horse
    (the “Don’t buy now!” Dude, then D. Pavlou, now Keen with a proven forecasting record…)
    Just sayin’

    • Display NameMEMBER

      Given the major parties have privatised themselves to multi national fossil fuel and resources companies I am not sure that Steve Keen could be worse. He might have an eye out for the average punter. Maybe. Cause the majors certainly do not.

      • It’s not about that. Politics is mostly about what’s possible.
        “Sustainable Australia Party”, “Don’t buy now!” etc are fringe politics, long shots of winning anything ever.
        Especially since the Turdball’s double dissolution…

    • Goldstandard1MEMBER

      Just so I’m clear mate, the Nazi’s were the popular horse to vote for once upon a time, but by your logic it makes no sense to back the opposition to them? Values and the prosperity of our country is more important than backing the winner (especially if they are sh!t). How else do you get change. I don’t rate your comment.

      • Nothing wrong with your principles. It’s about odds.
        My feeling is that many small steps in the right direction is a better strategy.
        I think the term is “realpolitik”.

        • Nothing wrong with your principles. It’s about odds.
          My feeling is that many small steps in the right direction is a better strategy.
          I think the term is “realpolitik”.

          For the last few decades “realpolitik” has resulted in occasional steps in the right direction and very many steps in the wrong direction.

          In no small part because these few steps in the right direction are typically presented as “compromise” by the people eagerly running in the wrong direction.

          This phenomenon is why the economic-left politics is largely nonexistent, even amongst the supposed far-left parties.

          • Perhaps I mispoke. I meant to say that it may be wiser starting from a centre than a fringe and work out our way from there.
            We have seen that the 3 major parties (yes, the Greens too) are always happy to collude to prevent others from entering the political arena.
            Centre Alliance was a good example (undermined by Rex the Patriot, though).

          • The point is things that were once considered mainstream, if not core responsibilities of Government – eg: full employment – are now called “fringe” because the system has been steadily ratcheted in one direction by “realpolitik”.

  5. reusachtigeMEMBER

    LOLOLOL! Bet the algorithm he created to determine if he should go into politics is totally wrong because he’s missed the true savviness of politics in his equation.

  6. Jumping jack flash

    It might be nice to have someone with actual qualifications and knows what they’re doing in the swamp again.

    I miss the days of yore when our leaders actually knew a thing or two about what they were doing, instead of this career politician crowd of flapping mouths we have at the moment that relies on “consultants” (read: big business) to “advise” them what to do.
    Unsurprisingly, big business’ advice is mainly aimed at what benefits big business, and its mates.

  7. Reducing house by reducing an owner’s mortgage so no one loses, yeah that’ll work.
    Everyone gets a participation ribbon again!

    3 to 4% deficits via mmt in a speculative economy, yeah that’ll work. To what ultimate debt levels? To infinity? And what if inflation does hit, what’s the plan then ?

  8. Would vote TNL just for the retrospective ICAC as it could see all the current Federal LNP members behind bars. Don’t think they’ll do much, as even though they are only running in non ALP seats, Labor is apparently referencing the old Libs above them to preserve the duopoly.

  9. Says he wants to put in citizens advised by experts. That’s happening now isn’t it and it’s causing riots. Not convinced this countries want experts informing policy. They want to be told what they want to hear then blame that same person when it turns sour.

  10. I may be behind here. My recollection is that Steve Keen was an academic in UK. Has he returned to ‘Straya?