Today?s blog is a little different to most, although don?t worry, I will get onto familiar themes soon enough. Today I am considering the latest broadside from controversial German philosopher Peter Sloterdijk, who Jurgen Habermas referred to as a fascist. Sloterdijk responded to that criticism by labelling Habermas, in turn, a fascist. That debate was about bi-genetics and Sloterdijk?s implicit support for a ?master race?. It was an interesting debate in itself and goes to the fundamental discomfort that exists in Germany about their past. But today I am considering his views on freedom and governments who he labels fiscal thieves and suggests that modern democracies have conspired to allow ever increasing numbers to live off the toil of others courtesy of state intervention.

The Austrian School fanatics would love this guy. Sloterdijk?s latest article was published in the Winter 2010 edition of the City Journal and was entitled ? The Grasping Hand.

As an aside, the City Journal is ?a quarterly magazine of urban affairs, published by the Manhattan Institute?. So who are the Manhattan Institute? Turns out they are a free-market ideas think tank and hand out the annual F.A. Hayek?s Prize to honour his vision of economic and individual liberty. They display curious inconsistencies though in advocating for ?free markets? yet also considering that financial markets need to be tightly regulated by government to avoid the latter bailing out the former during a bank crisis.

Sloterdijk starts with the contention that ?(t)he modern democratic state pillages its productive citizens?. Which got me wondering if democracy means we can vote them out ? which means that, despite our limited political choices these days, the control of the political process by the media doing the bidding for the top-end-of-town, and the flawed balloting systems in some countries (including the US), this would be a situation where we sanction the state pillage. Sort of self-pillage.

He begins by juxtaposing classical liberalism and anarchism ? both movements which were ?motivated by the mistaken hypothesis that the world was heading
toward an era of the weakening of the state? and hoped that:

? man?s plunder of man would soon come to an end. In the first case, this would result from the elimination of exploitation by
unproductive classes, that is, the nobility and the clergy. In the second case, the key was to reorganize traditional social classes into little groups that would consume what they produced.

I have no problem with this characterisation. Sloterdijk says that neither movement survived the political developments into the C20th, and that:

The modern democratic state gradually transformed into the debtor state, within the space of a century metastasizing into a colossal monster-one that breathes and spits out money. This metamorphosis has resulted, above all, from a prodigious enlargement of the tax base-most notably, with the introduction of the progressive income tax. This tax is the functional equivalent of socialist expropriation. It offers the remarkable advantage of being annually renewable-at least, in the case of those it has not bled dry the previous year.

There seem to be a lot of confusions in this characterisation.

First, if it is breathing and spitting out money that capacity would appear to be organic to the state. So then why is it a debtor state? The reality is that the likes of Sloterdijk who err towards classical liberalism in his ?economic? ideas (and I use that term loosely because he knows nought about the way the monetary system operates) although his other works (as noted) on bio-genetics are ominously scary and invoke the master race notions that Plato first espoused and were taken up very patently by Sloterdijk?s countrymen and women in the 1930s and beyond.

The political ideology that we term classical liberalism is the foundation of the free market perspective in economics and sees very little role for the state. Classical liberals are well represented by the likes of Jean-Baptiste Say (of the famous Say?s Law) which argued that there could never be unemployment or production gluts because interest rates would also clear to ensure that saving equalled investment. This meant that if consumption fell away (and saving rose), firms would just gear up to satisfying investment goods production instead of consumptions goods production ? the rise in saving would increase the flow of funds into the loanable funds market and drive down interest rates and stimulate investment.

This was a dominant thought in the C19th century and still persists today via the Chicago School. Almost all mainstream economists think that this is a correct view in the long-run although they try to temper their views by noting that frictions in the short-run might lead to temporary over-production and therefore unemployment.

If you give the idea a seconds thought you will want to know how machinery and physical capital designed to pump consumption goods out suddenly metamorphise into new machinery and capital capable of producing investment goods (machines etc). If you study economics via a mainstream course you will learn that capital is conceived of as malleable (putty) that can just be squeezed into different shapes and forms at will. It is looney stuff yet lecturers each day pump this stuff out in mainstream production, growth and distribution theory courses.

All of this capital theory was destroyed in the 1960s by the so-called Cambridge Controversies, which I might write a blog about one day. You won?t read about this debate in the mainstream textbooks and it is never taught any more but take it from me the mainstream neoclassical production and distribution theory (which relies on their capital theory) was rendered logically inconsistent and meaningless as a consequence of this bitter and drawn out debate. The Cambridge reference is to the two Cambridges which formed either side of the debate ? the University of Cambridge in England (demonstrating the weaknesses of mainstream theory) and MIT in Cambridge, Massachusetts (defenders of the orthodoxy).

Of-course, Marx and then Keynes demonstrated beyond doubt that Say?s Law was nonsensical when applied to a monetary economy which was burdened by uncertainty. Keynes also showed that saving at the aggregate level was a residual (after consumption) and interest rate movements did not bring it into balance with investment (in a close economy without government).

Rather Keynes showed that it was income adjustments that brought aggregate demand and supply together and the capitalist economy could get stuck in a situation where output levels (supply) were below the level required to fully employ the available labour force. Further, because the firms were able to sell all they produced at this lower level of output there was no incentive to expand production. The remedy was to introduce an exogenous spending shock to break this under-full employment equilibrium and that became the modern justification for fiscal interventions.

Please read my blog ? Functional finance and modern monetary theory ? for more discussion on these points.

Later classical liberalists were Friedrich Hayek and Milton Friedman and so you know where Sloterdijk fits into the scene.

So in this broad context we have to wonder why the national governments issue debt at all seeing as it is one of the things that bugs Sloterdijk. As I explain in this blog ? Gold standard and fixed exchange rates ? myths that still prevail ? the constraints imposed on national governments by this system meant that governments had to cover their spending with taxation and/or borrowing from the private sector. They simply could not stay within the convertibility system and violate those constraints.

The reason the system fell apart in 1971 (finally) was because it was unsustainable. It forced nations with external deficits to systematically deflate their domestic economies (via monetary contractions) which meant persistent unemployment and lost income earning opportunities. Further it put no adjustment pressure on surplus nations ? other than their own citizens complaining about the huge foreign reserve stockpiles these nations accumulated which could have enhanced the material standards of living of their citizens.

So while this was a very wasteful system when it comes to real resource utilisation (labour and capital was persistently underused across the world) and income generation, by that very means, it became a politically untenable system.

Under the fiat monetary system from 1971, national governments became sovereign in their own currency which means that they were no longer revenue-constrained. They can spend however much they like subject to there being real goods and services available for sale. Irrespective of whether the government has been spending more than revenue (taxation and bond sales) or less, on any particular day the government has the same capacity to spend as it did yesterday. There is no such concept of the government being ?out of money? or not being able to afford to fund a program. How much the national government spends is entirely of its own choosing. There are no financial restrictions on this capacity

But if the convertible currency system ended (for the most part) in 1971, why do national governments that issue their own currency still also issue debt virtually $-for-$ to match their net spending flows? The question is even more pointed when you realise that in this sort of monetary system the national government is not revenue constrained as above.

A child would then ask the obvious question ? not having been tainted yet by the ideology of classical liberalism ? then if governments can spend without issuing debt why do they open themselves to the political chagrin of the deficit terrorists and the outlandish posturing of the likes of Sloterdijk by borrowing?

It is an excellent question. And the child will grow up to learn that the answer is that the governments have been captured by the classical liberal ideology (which I guess we now stylise as neo-liberalism) and succumb to relentless pressure put on them by the political process, not to mention all the recipients of the corporate welfare (the hedge and future funds) who get a risk-free annuity to price their risky speculative products off.

The latter complain relentlessly in public about the vicissitudes of the debt-bloated monolithic state but complain even louder when the state actually follows their advice and runs surpluses, pays down the outstanding debt and renders the bond markets too thin for reliable trading and risk benchmarking. One word: hypocrites. We could have put an adjective in before that starting with F*****g!

Well there are several reasons why such a government continues to issue debt ? some technical and others ideological.

First, in technical sense, when there are deficits bank reserves are growing and banks will try to get rid of these reserves by lending them on the overnight interbank market. The competition for funds drives the interest rate down to whatever support rate the central bank pays on overnight reserves. The problem is that the banks cannot eliminate the system-wide reserve surplus created by the deficits. If the system is left alone the central bank will lose control of its target interest rate. There are two things the government can do to retain control over its monetary policy stance. It can offer an interest-bearing asset in place of the reserves ? that is, sell the banks government bonds (that is, ?borrow?) or it can pay the target interest rate on overnight reserves. The second option is currently being used in the US for example.

Second, the overwhelming sentiment of the business community and the conservative nature of our political system (and its participants) leads to a largely anti-government swell of opinion which is continually reinforced by the media ? the ?debt-deficit hysterics?. The neo-liberal expression of this over the last three decades has overwhelmingly imposed massive political restrictions on the ability of the government to use its fiscal policy powers under a fiat monetary system to ensure we have full employment. We now accept very high unemployment and underemployment rates as a more or less permanent feature of our economic lives because of the political constraints imposed on government.

So while there was a major shift in history after the collapse of Bretton Woods, the logic that applied in the fixed exchange rate-convertibility days is still being imposed despite the economic fact that it does not apply in the fiat currency era.

The neo-liberal macroeconomic reasoning that you read about in the newspapers is really the sort of reasoning that prevailed in the days prior to fiat currency. The shift in history renders most of the textbook economics outdated and wrong, in terms of how they depict the operations of the fiat monetary system.

In Australia, for example (which is a common experience), even though after the Bretton Woods system collapsed, the Australian government was no longer revenue-constrained, it actually tightened the self-constraints on spending ? to satisfy the growing neo-liberal policy influence ? by changing the system of debt issuance (from a tap to auction) and insisting that all the net spending be fully covered by debt issuance in the private markets. Please read this blog ? The problem of being a macro economist ? for more on that.

The reason they did this was to place ?further fiscal discipline? (in their own words) on government spending. They knew there was no fiscal constraint and they knew the electorate could easily be duped into the ?government debt is bad and choking our kids? hysteria ? the more prosaic expression of classical liberalism. These changes occurred as the neo-liberals began to dominate policy and were overseeing cut backs in government and rising unemployment.

This blog ? Will we really pay higher interest rates? ? provides some historical perspective on this tightening noose that the Government voluntary chokes itself (politically) with.

So all this industry surrounding public debt-issuance ? the banks that get involved in the sale of the debt ? the commentators who whip themselves up into a frenzy over it ? the economists who swan around the world telling us about sovereign default risk ? the future traders who profit from using the debt as a risk-free benchmark to price their own products ? and the rest of it ? is all built on an ideological obsession that government is bad and private markets are good.

Imagine if the government saw through all the smokescreens and announced they were no longer issuing debt and would just continue to credit bank accounts as necessary to support full employment? The neo-liberals would scream inflation ? but would soon run out of steam with that line of attack.

Further, given how much of our wealth has been lost by private markets operating in a self-regulating environment in recent years I cannot believe we still hold onto these prejudices.

So Sloterdijk?s debtor state concept is a pure outcome of neo-liberalism ? the political ideology that he espouses. As is the obsession with taxation as a ?funding source? for governments.

Yes, taxation raises revenue for national governments but doesn?t fund its spending. All taxation does in an operational sense is reduce the spending capacity of the non-government sector to ensure that there is non-inflationary space for government to deliver public services.

Further there is no functional equivalence between taxation and socialist expropriation. The latter is a concept that socialist states use to justify not paying their workers the full value of the daily product they create. So it is just like the capitalist wage form except the socialists would say the surplus is being used to advance the welfare of all rather than just the rich.

As an aside, when I was a postgraduate student some Soviet economists visited Monash University and were talking about socialist expropriation. I asked them the question: was a worker who rose in the cold of the dark morning and went to the factory all day for a low wage any better off in a socialist state as one who did the same in a capitalist state. They replied that the worker in the former gets a social wage on top of his/her actual wage whereas in the latter situation the social wage is always suppressed. I didn?t live in their system so I cannot comment about the validity of this conclusion. But that is the theory. If you think about it for workers who make capital goods to be able to consume, the workers in the consumption goods sector have to create surpluses for expropriation ? irrespective of who owns the means of production or organises the same.

Anyway, in a democratic system, each generation can choose its own tax burden. They can decide whether to have low or high taxes and correspondingly, less or more public goods and services. Please don?t think that the former (taxes) provide the funding for the latter. That would be a totally incorrect understanding of the way the monetary system functions.

The trade-off is in terms of available real resources that can be utilised by the non-government and government sectors without inflation. Clearly, by raising taxes, the government is gaining access to more underutilised real resources than if the private sector has greater spending capacity. Economic theory ? Modern Monetary Theory (MMT) or mainstream theory ? can say nothing about what option is socially desirable. These are entirely political choices yet if you read mainstream macroeconomic textbooks you will get a barrage of ?small government is best? argument.

These arguments are just ideological statements dressed up with graphs or maths to deceive the students into thinking they are theoretically-based and hence have a ?greater? authority.

Sloterdijk then moves into his main agenda ? his desire to rid the nations of unproductive bludgers. But in a twist of classical liberal thinking it is not the nobility that are is targets but rather the most disadvantaged people in our societies.

Here is his contention:

"... each year, modern states claim half the economic proceeds of their productive classes and pass them on to tax collectors, and yet these productive classes do not attempt to remedy their situation with the most obvious reaction: an antitax civil rebellion. This submissiveness is a political tour de force that would have made a king's finance minister swoon."

This claim is without foundation. It is fairly time consuming getting up to date statistics that are consistent on these sorts of statistics for each country. The OECD compiles this sort of data and you can see the sort of proportions as at 2003 HERE. The Forbes magazine took the trouble to compile tax and government spending ratios as a per cent of GDP for the OECD in 2004 which you can view here HERE.

The following graph shows the tax and spending burdens as a per cent of GDP for 2004 ranked right to left by size of tax burden. Note the average tax ratio is 43 per cent of GDP and the government spending ratio is 49 per cent. This figure is biased upwards by a small number of nations, all of which enjoy high quality public infrastructure and services and high per capita incomes. If you exclude these OECD countries (Sweden, Denmark, Norway, Finland, France, Austria and Italy) the average tax ratio falls to 34 per cent and the government spending ratio falls to 42 per cent for the remainder (the vast majority) of the nations.

But the argument is based on false notions which I will come back to later.

Sloterdijk considers the bloated public sectors mean:

"we do not live in a capitalist system but under a form of semi-socialism that Europeans tactfully refer to as a social market economy" The grasping hand of government releases its takings mainly for the ostensible public interest, funding Sisyphean tasks in the name of social justice. Thus, the direct and selfish exploitation of a feudal era has been transformed in the modern age into a juridically constrained and almost disinterested state kleptocracy.

Sisyphus was the cat who upset Zeus and for his sins had to roll a large rock up a steep incline which was impossible and it would always tumble down again. Sisyphean tasks are relentless and ineffective tasks.

Critics of public sector activity always eventually come back to the claim that it is leaf-raking and boondoggling,  meaning it is a wasteful, unproductive endeavor.

I just love it when publicly-funded academics such as Sloterdijk, who is the Rector at the Staatliche Hochschule für Gestaltung Karlsruhe (HfG) (State College of Design) argue that state spending is entirely wasteful and the product of kleptocracy, and put pressure on governments to reduce the welfare state, yet retire with comfortably generous state pensions and enjoy very satisfactory working environments along the way.

I won't get into the wasteful, real job/unreal job, debate that is implied here. I consider this question in great detail this blog, Boondoggling and leaf-raking ,.. Suffice to say it is without question that the state provides services and infrastructure which enhance our welfare generally and provide private profit seekers with structure to leverage off.

As an aside, the largest unproductive sector is the financial sector. Yet they are grasping an ever increasing share of real GDP (of which they produce hardly any proportion) and when they overstep they then put their hands out for public assistance. Sloterdijk would be better targeting these distributional drains rather than implying the most disadvantaged citizens are bludging off the rest.

The state as our agent has the economies available to provide public infrastructure etc which exceed the sum of our individual capacities.

Further, how are we to understand the relationship between government and non-government outside of the emotional hyperbole presented by Sloterdijk? As noted above each generation chooses its own tax levels and the extent of receipt of government services, that is, in systems where their is a functional polity with elections.

But where do the funds that we use to pay taxes come from.  The national government is the issuer of the currency. It is not our currency which we get stolen and in return we get government services justified as helping us. We cannot pay our taxes until the government spends. That is an essential insight into the fiat monetary system that MMT provides.

We are being hoodwinked into believing otherwise.

Further without a monetary system you are back in the dark ages with barter exchanges. Once you introduce a monetary system and have cross-border transactions then you have to have government. It might be a small government footprint which would be a political choice but it will be a sovereign currency issuing government nonetheless. You can have perversions of a free fiat currency system such as the EMU but you can trace the same sorts of monetary operations within that system with perverse impacts on member nations being the result of the flawed construction.

One could also argue that the introduction of a tax in the first place is oppressive. It all depends on how you define oppression. It is oppressive to have red lights at intersections and fine people who disobey them. But the benefits of safety and relative certainty on the roads easily offsets this invasion of our liberties. It is all about judgements we make about the efficiency of living together.

It is far better to have people by and large traversing intersections safely and freely moving to their desired destinations than having continual road carnage and death.

In questions like this we could have private or public operators of the intersections. The public good nature of such infrastructure means that it is unsuitable for private profit making. So even mainstream economic theory sees a role for public provision when there are such externalities as they call them.

More generally, a sophisticated civilized society learns to embrace broader constructions of human interrelationships than those prescribed by exchange relations emanating from market places. The private free market cannot embrace these sophistications because they cannot be priced. That is another reason we desire government provision and allow the government to command real resources that are in the private sector and to use them in their socio-economic program. Taxation is the way this public capacity to utilise real resources for greater good emerges.

As an aside, I note that many commentators on my blog use terminology like if we had an MMT government.  I really enjoy the interchanges that occur within the comments although I find it hard to find time to respond as fully as I might. But using this sort of terminology means the person does not really understand that most countries already have modern monetary systems in the sense that the operations of the system as described by MMT. Their policy choices within that operational reality might not accord with what I would do should I ever be given the fiscal and monetary policy reins but that is another question. The US, Australia, Japan, the UK and hundreds of other nations are MMT governments!

Sloterdijk then gets to his essential point:

Free-market authors have also shown how the current situation turns the traditional meaning of exploitation upside down. In an earlier day, the rich lived at the expense of the poor, directly and unequivocally; in a modern economy, unproductive citizens increasingly live at the expense of productive ones-though in an equivocal way, since they are told, and believe, that they are disadvantaged and deserve more still. Today, in fact, a good half of the population of every modern nation is made up of people with little or no income, who are exempt from taxes and live, to a large extent, off the other half of the population, which pays taxes.

Got that crew! The poor are living on the rich!

The idea is that governments have created welfare states which provide unsustainable benefits to the poor and marginalised at the expense of those who are materially successful.

So who are we talking about? The children live of the efforts of their parents. No doubt. Sloterdijk would approve of this because he favours a purely private welfare system where generosity would see the rich give to the poor.

Further, older folks who no longer work clearly command real resources that they have not themselves produced. No doubt. The sick and in-firmed, the mentally ill and the disabled all who cannot work clearly command real resources that they have not themselves produced. No doubt. Sloterdijk is appalled by the fact we choose to support these cohorts.

And ? the marginalised are the least powerful in political processes whereas the materially successful are typically the cohorts with the most political leverage. So why do they vote in governments that do this?

Part of a move towards civilisation is that we can afford this 'generosity' to our fellow citizens who have worked in the past or will work in the future or who will and can never work. We see a social value and purpose in people beyond a person?s immediate daily production.

But, moreover, none of these people are being funded by taxation. The government could reduce taxation considerably and still provide adequate state pensions to university academics (some of them who lead the charge against pensions to the lowest income workers) and everybody else; and still provision public schools and hospitals and provide aged care for those without independent means.

Sloterdijk clearly doesn't understand how the monetary system operates and the way the government transacts within it. The reason they will not reduce taxes to the levels the Austrian School would like is that there would be rampant inflation because nominal demand growth would exceed the real capacity of the economy to absorb it.

So Sloterdijk would retort 'okay stop public spending.' Fine, many nations have low public spending ratios (see graph above) But they also have different public provision. Whether that is better or worse is a political question and the debate would reflect our respective value systems.

I actually prefer to drive to work or ride by bike along public roads and across public bridges without having to negotiate an access fee at each intersection with a private provider.

I prefer being able to go down the beach and not have to pay access fees to get into the surf. I prefer to know that the vast bulk of the children in our world receive education and a future because of public education provision that does not sort people by an access fee. And so on. I understand others have different views on these matters. But it is not a matter that any economic theory can decide.

If we go back in history and think about the way the 'deserving poor' were dealt with by the private market,  in poor houses which were nothing more than penal servitude then I think I prefer a publicly-provided safety net every time. To me the poor have more 'freedom' under this system than they had during the period I refer to.

Finally, I often pose the question when I am giving public presentations and it is this: How are we to judge the performance of the state? My answer is: Not how rich it makes the rich but how rich it makes the poor!

I have seen no credible research that suggests that private rates of return in nations that have larger public sectors are lower than otherwise. But I have seen a lot of credible research that shows that reduced inequality in income distributions is a positive fillip to economic growth rather than the other way round. Nations that impoverish vast masses of their population waste the greatest potential they have the capacity to work and achieve.

The major issue I have with government spending is the large chunk that goes to corporate welfare. They never complain when that happens. When the US government announced a huge increase in financial support to the banks we heard no complaints at all from this lobby.

And finally, after all this political posturing dressed up as philosophy, Sloterdijk offers his last policy advice:

At present, the main danger to the future of the system involves the growing indebtedness of states intoxicated by Keynesianism. Discreetly and ineluctably, we are heading toward a situation in which debtors will once again dispossess their creditors-as has so often happened in the history of taxation, from the era of the pharaohs to the monetary reforms of the twentieth century. What is new is the gargantuan scale of public debt. Mortgaging, insolvency, monetary reform, or inflation-no matter, the next great expropriations are under way. Today, the state's grasping hand even reaches into the pockets of generations unborn. We have already written the title of the next chapter of our history: The pillage of the future by the present.

Intoxicated = drunk. The subdued fiscal reactions by the vast majority of our national governments to the largest crisis in 80 years did not look like the behaviour of a drunken sailor to me. The reason the crisis has dragged on for so long and the damage will be correspondingly higher for longer is because governments didn't expand early enough nor in sufficient scale to be more effective.

And the next generation will be better off because of this modest fiscal intervention (after years of neo-liberal neglect of public space) than they would have been without it. Already significant cohorts in the population will bear the scars of this recession because the policy response has been so marginal. But given there was a response and it has prevented a global depression then the number of people bearing scars is less and the severity of the pain lower than would be the case otherwise.

We will see in the coming years how much inflation and how high taxes go. But at any rate, these changes will have no real relationship with the fiscal policy interventions at present. Inflation may rise if energy prices increase or if aggregate demand is pushed beyond the real capacity of the economy. At present it will not be driven to this point by the scale of the fiscal interventions.

Taxes might rise if there is inflation and the government makes a political choice to hold the public/private mix in real GDP constant. But they won't rise to fund any debt paybacks.

A sovereign government never has a problem paying its debt on maturity or servicing it in between times. It is just another act of government spending. So it doesn't need to inflate away its debt or raise taxes.

A lawyer in Los Angeles who understands

I came across this article yesterday (April 6, 2010) ? An everyday tale of how the extremely rich are different, which carried the sub-title ?Frank and Jamie McCourt accused each other of cheating?.

So that might seem a bit lurid for a blog about MMT and other more mundane issues. But there was a deep message carried within the article.

Superficially, the story is about two rich characters Frank and Jamie (his estranged wife) who own or perhaps own the one of America's most famous baseball teams, the Los Angeles Dodgers. Frank definitely owns them but Jamie also thinks she owns them too. Anyway, Frank and Jamie don't get along any more and there is a huge divorce battle going on where Jamie wants Frank to pay her $US 988,845 a month in spousal support to maintain her existing lifestyle plus several million more for other things plus unlimited travel expenses, 24-hour security at her homes and flowers in her office. If that wasn't enough there were more demands that I don't care to mention. Part of the dispute is about who owns the baseball team.

Now Frank disputes all this and his lawyer cast them both as a financially irresponsible couple living well beyond their means? Then he said:

These people have lived their lives with borrowed money. They have to stop spending. This isn't the federal government.

The lawyer also noted that Jamie has two adjoining Malibu homes, one to live in and the other to do her laundry.

Anyway, focus on the quote these people have lived their lives with borrowed money. They have to stop spending. This isn't the federal government?.

So at least one person in Los Angeles understands the difference between a household who is the user of the currency and is always financially constrained and cannot keep borrowing forever and the national government which is sovereign in the currency as the monopoly issuer and can spend as much as chooses up until the goods and services available are exhausted without any financial constraints.