Show Notes
Foreign aid is shrinking fast. The UK has cut its commitment from 0.7% of national income to 0.3%, the US has scrapped USAID and axed 80% of its projects, and overall global aid is down by more than a quarter in just five years. That’s less than 0.2% of the world economy — smaller than Walmart’s turnover — even as the Gates Foundation warns that cuts have already reversed decades of progress in child survival. In 2025 alone, 200,000 extra children under five are expected to die from preventable causes. And in places like Afghanistan, Somalia, and the Central African Republic, one in ten infants won’t make it to their first birthday.
Economist Steve Keen argues that aid is often designed with the assumption that chunks of it will flow back to donor countries through trade and contracts, reinforcing global imbalances rather than fixing them. He suggests revisiting Keynes’s old idea of a Bancor — a global currency to balance trade — so aid isn’t just a disguised subsidy for rich economies. Without structural reform, we’re left with the paradox of trying to support countries where GDP per capita is $150–$200, while the same amount is a single day’s salary in Luxembourg. Rethinking aid means asking whether we’re propping up conflicts and fragile states, or building a fairer system where resources actually stick and help people survive. Hosted on Acast. See acast.com/privacy for more information.
More from Debunking Economics - the podcast
Fear and greed don’t affect everyone equally. In this episode, Phil Dobbie and Steve Keen explore how debt, financial bubbles, and economic policy can reward those at the top while leaving workers, renters, and households to carry more of the risk. From market crashes and speculative booms to the growing role of private debt, they unpack why inequality persists—and why fear has become an everyday reality for so many. Hosted on Acast. See acast.com/privacy for more information.
Phil and Steve unpack the case for a renewed relationship with Europe, from trade and supply chains to freedom of movement and political sovereignty. They debate whether the euro still makes sense in an era of low-cost digital payments, why a shared currency can leave national economies exposed, and what European cooperation should actually look like.
Bond yields are not “warning” governments to behave—they’re exposing a system where central banks and treasuries can backstop the entire market whenever they choose. Steve says the panic around government debt is mostly an economic fairy tale, and the real danger is what happens when policymakers let that fiction dictate spending.
Equilibrium is a fantasy—and this conversation explains why. Phil and teve explore how the belief that markets naturally self-correct has shaped economic policy, contributed to the failure to anticipate the Global Financial Crisis, and continues to distort debates about bond yields, government intervention, debt, and inflation. From Irving Fisher’s original models to today’s financial markets, AI bubbles, and rising government bond yields, Keen shows why capitalism is better understood as an “always moving equilibrium” than as a system that ever truly settles. The discussion also looks ahead to his forthcoming book, How Economists Will Destroy Capitalism, and the urgent consequences of treating elegant economic theories as if they describe the real world. Hosted on Acast. See acast.com/privacy for more information.
Paul Keating is often sold as the man who modernized Australia - but what if the reforms that made him legendary also helped create the financialized, boom-and-bust economy we live with today? Steve argues the real story is far more unsettling. From the "recession we had to have" to the housing bubble, tariff cuts, bank deregulation, and the superannuation system, he breaks down how Keating's policies reshaped Australia in ways most people still misunderstand. If you think Keating was simply a brilliant reformer, this conversation will challenge that view. Keating was an extraordinary parliamentary orator but a dangerous believer in textbook economics. Discover how the 1987 crash and first home buyers grant helped set up the 1992 recession, and why the push toward finance over manufacturing left Australia weaker, not stronger. He also explains how Keating’s attacks on the GST, the rise of neoliberal thinking inside Labor, and the long fallout from deindustrialization still shape Australian politics today. Hosted on Acast. See acast.com/privacy for more information.