We could certainly debate monetary theory - money borrowed into existence vs money printed into existence by the government. One gives power to the banks, and the other, to politicians. Which is better? Man, that’s hard to say. Both use the power for their own selflish ends.
At least bank money vanishes when people no longer want it - through defaults. I’m not sure that would ever happen with politician-printed money. Could they handle causing a recession, knowing they’d lose the next election? I haven’t seen any hints of such moral courage from the political class.
As for your response…I couldn’t help but notice that in your reply, you responded to several things I didn’t say. For instance:
Another for instance, when I hear people talk about the national debt and how we are robbing from our grandchildren…I didn’t say that.
Some gross misrepresentations of MMT are statements like “deficits don’t matter” or we can just “print our way of our problems.” … I didn’t say that.
To say its Keynesian or Chartilism is distorting the scholarly research… I didn’t say that either.
And we agree on other things - not sure why you brought them up…they are more or less an article of faith with me, and nothing I wrote in my post would have suggested otherwise:
Money ultimately is a social construct…Agree.
There is no inherent value in any object, gold or otherwise, because value is subjective, which is a human construct. Agree.
The same easy money has also been used to speculate on almost everything in our economy through the use of financial instruments. This should also cause us think deeply about how that speculation distorts and creates malinvestment. Agree.
I was disappointed to see that my central point was left unaddressed.
How would MMT function in the context of Rules for Rulers? How would politics - staying in power by rewarding your donors/favored groups interact with a politician-controlled funding source that is limited only by “self-measured inflation.”
Those of us who studied US history know what happened when Nixon popped off the gold standard in 1971 in order to print money (via bank debt) to win the 1972 election. Massive inflation, which lasted for 8 long years. If you give politicians control over money (in this case, by dropping off the gold standard), they use this power to win elections and reward their followers, and it takes Paul Volcker and 20% interest rates to bring things back under control - but not until inflation had destroyed the savings of a generation.
I see a similar event occuring with MMT, because humans haven’t changed since 1971. Give politicians control of the printing press - the outcome will be identical. “But its ok since we’re saving the planet!”
That’s the new wrinkle. Saving the planet.
As always, the savers will end up paying for everything.
Am I stuck on the “prescriptive” side? You bet I am. That’s where the rubber meets the road. Can this be used in real life.
yes, the money source with bankers is bad, also with politicians.
But there is another solution, money creation in the hands of organized people, https://unitycoin.net/
Ok, I’m glad MMT agrees with me on the political will issue.
To me, requiring that “political will” be in place as a requirement for the system to function properly is tantamount to requiring that hungry dogs ignore pieces of meat dropped in front of them. Such a requirement will never be met. Politicians will always want to get re-elected, and they’ll do just about anything to make sure that happens - pushing the boundaries of the rules (and changing them) everywhere they can. Giving them the unchecked ability to print money ensures a move to inflation, and then hyperinflation. Hungry dogs + pieces of meat = gobble gobble gobble, its just the nature of the beast.
The only way to deal with such enthusiasm is to design a system that provides a built-in check against it. There must be an equally strong countervailing force that prevents politicians from engaging in ridiculous spending programs designed to reward their followers/donor/favored groups. Depending on “political will” - i.e. depending on them to “be good” - I mean, come on. Gobble gobble gobble. It is not in their nature to be good.
A physical check, such as gold bars, worked fairly well in the past. Politicians couldn’t argue with gold bars that disappeared every time they got too spendy. I’m sure it was frustrating for them.
If you look closely at the timing of the gold supply, the Fed funds rate, and the timing of Nixon’s re-election campaign, you will see a nicely choreographed dropping of rates less than a year before the election. But the only way that worked was to slam the gold window - given the reading of the CPI and the rate of growth of bank credit at that time. If the Fed had tried cutting rates under the inflationary conditions in 1971, all the gold would have fled. So the solution - slam the window, drop rates, inflation shoots through the roof, but Nixon gets a 6-7% GDP growth rate by November 1972, and he wins by a landslide. This wasn’t an accident, it wasn’t oil - it was a strategy to keep the crazy McGovern from getting elected. Read McGovern’s platform sometime, it was pretty wild. They even had a UBI. We forget what things were like back then.
There was also a nifty paper written by … I forget who, some researcher at the Fed, which lays out how cooperative the Fed Chairman at that time was about dropping rates to keep Nixon in power. The whole status quo was terrified of the left at that point.
And then if you watch how rates go throughout the 70s, you can see that while oil was a problem, it wasn’t the biggest one. They just never kept rates low enough for long enough. The rate of credit growth was just ridiculously high. And as we know, rising credit = inflation. It took the Fed 10 years to figure out how to control bank credit properly without gold to provide them the proper signal - and someone with real guts to deliberately cause a recession to stop the growth of bank credit. You may not think Volcker did the right thing, but I think he did, just based on how bank credit responded to the Fed’s lame attempts to keep money under control.
But I digress.
So, any monetary system that involves politicians being able to print at will must have a built-in structural check on that power that is equal in strength to the politician’s insatiable desire to get re-elected and reward their voters/donors/etc. Right now, I’m not seeing that in MMT. I’m not seeing any check on the Fed’s ability to reward speculation and the banksters either, but saying “wow our current system sucks, so let’s replace it with one that is equally sucky but in a different way” doesn’t appeal.
I’m open to suggestions. A big batch gold bars worked fairly well as a check, until they got rid of them. The threat of those gold bars vanishing (which caused the money supply to plunge) kept the fiscal peace for several generations. It was an equally strong countervailing force that kept the politicians in line.
Is there a better way now? I’m open to hearing about one. Requiring “political will” doesn’t do it for me however. That’s one of those “aspirational” things, rather than a check-and-balance of the sort engineered into our government by the Founding Fathers.
Executive, Legislative, Judicial. All three keeping each other in check - all three full of power-hungry, likely corrupt people. No hopeful requirements of “political will” - just a naked separation of powers. It assumes perfidy and corruption will occur. That’s why it has lasted so long.
Separation of Powers for the financial world. Design a system that assumes corruption - that assumes there will never be “political will”. That’s what we need.
My opinion of course.
I agree with some of what you write, but not the more ideological parts. As someone that has worked in public sector finance for many years, lumping the government into a stockpile of federal politicians that are nothing but self-serving dogs may be tempting, but there are in fact many good people that are working tirelessly to keep our system going so we can enjoy our way of life. I have learned to be more empathetic and pragmatic and much less ideological. Real work needs to be done, and taking hardline ideological positions in my line of work often leaves everyone in the room throwing up their hands or just ignoring “that guy” in the room. I guess what I’m saying is the hungry meat analogy I’m sure appeases those looking for hungry meat, but it doesn’t convince me to ignore my own experience.
I agree that checks and balances are needed. New regulations and laws can help create those checks and balances, as well as expiring old and current laws that are being abused. Gold backed fixed currency, as I’m sure you know, has its pros and cons. A shift back to the gold standard in reality would be extremely painful considering our trade deficits and the restrictions it would place on our domestic policy space, especially in light of the high private sector debt. We need the obvious changes in campaign laws, finance regulations, possible term limits, and so on. But to say we can’t have a government that returns to a more balanced approach to caring for its populations ignores the many governments around the world that are doing better than we are. I think I read somewhere recently that the US ranks 19th on the “happiness” index, whatever that means. It might be interesting to see what these happier nations are doing, not just in how they structure their government, but in what their societies’ value. We have become a nation that unfortunately values wealth by the negative side of the balance sheet… nonproductive financial instruments, rents, and so on. Maybe that sounds somewhat superficial, but is it really?
As far as the 70s, that is one way of looking at what happened, and it may be true, but one can also view Volcker’s floating interest rate policy as causing the rates to irresponsibly rise to 19%, causing two deep recessions in 80 and 81, massive unemployment, a major downturn in manufacturing, and eventually a global recession. Soon after, the eventual high dollar value hurt US exporters. So, inflation falling could have been merely the result of the recessions, the economic contraction, and a steep fall in the price of oil partly due to the deregulation of natural gas in 1978 which cut demand for crude, and not necessarily by monetarism. Volcker’s high interest rates also added greatly to business costs and unearned income long after inflation dropped. But again, who knows for certain as all these things happened within a short time.
I am also open to proposals as to how to balance our monetary and fiscal operations more appropriately to address the needs of our country and planet. It may or may not be possible until we have some kind of economic downturn like the 1930s, but I don’t look forward to something like that.
I agree with some of what you write, but not the more ideological parts. As someone that has worked in public sector finance for many years, lumping the government into a stockpile of federal politicians that are nothing but self-serving dogs may be tempting, but there are in fact many good people that are working tirelessly to keep our system going so we can enjoy our way of lifeRight. I don't believe that politicians are in fact dogs. I used dogs at a metaphor only, to illustrate emotionally that politicians are, by the nature of the system, driven to represent their favored groups (e.g. "The Senator from Boeing"). That's just the political/monetary/social system at work. If they don't do so, they don't get re-elected. These days, if they don't sell out to the donor class, then they get primaried in the next election. In some sense they are prisoners of the system just like the rest of us. Ok, sure they get rich after "government service" via the revolving door, but they know deep inside they are not doing the right thing, and that can't feel good. There. Empathy. See I'm a good person too. To me that's not ideological, its simply Social Physics. One can bemoan the Law of Gravity when one falls down, but pretending that Gravity is some sort of ideological position that one can choose not to believe in might well lead one to doing foolish things that would result in injury. That's what the MMT folks are doing, in my opinion. And FWIW I said nothing at all about government workers. I think you are once more responding to something I didn't say. My guess: they do the best they can in the environment they find themselves in. As do most of us. Look at that, more empathy.
...one can also view Volcker's floating interest rate policy as causing the rates to irresponsibly rise to 19%, causing two deep recessions in 80 and 81, massive unemployment, a major downturn in manufacturing, and eventually a global recession. Soon after, the eventual high dollar value hurt US exportersI don't know what label is attached to what Volcker did, but I do know from looking at the charts what the response of bank credit was to interest rates. Raise rates high enough, and bank credit stops being created. And bank credit growth and inflation go hand in hand. New bank credit injected directly into the economy causes inflation. It seems like another one of those laws of physics to me. Raise rates, people stop borrowing, economic activity slows, and inflation drops. If your group of wise-men MMT people just stopped printing money - well, then economic activity would slow, people would stop borrowing money, inflation would drop, and a recession would result. There will always be recessions. That's the cycle. Recessions come from mal-investments that happened during the boom that end up blowing up on the investors when things slow down. Shall we have a discussion about recessions and why they are just a part of life - like night and day, summer and winter, life and death? So we find ourselves in agreement. There must be some sort of strong, systemic check on politicans' desire/need/drive to allocate money in as large a quantity as possible to their favored groups. Again, I'm open to what that check might be. Could we go back to the gold standard? Boy, with our current debt, I'm not sure we could. Borrow in fiat, and repay in gold. But we should think of something. Something that vanishes almost immediately when politicians behave fecklessly. Gold was awfully convenient, but maybe we can come up with something better. Then we don't need to have the government borrow any longer. Just printing the difference is more efficient. I'd trust MMT if there was something like an unchangeable law of monetary physics that slapped them all collectively in the face if they started getting out of control - which they will, because that's the nature of how things work - something they could bemoan and complain about but could not change. Until such a check is put in place, giving MMT to politicians is like handing a live hand grenade to a child. You just know how it will play out. You don't know how long it will take, but you know it won't be a happy ending. Given my savings is in USD, I am definitely talking my book. I don't want my savings to vanish. Is that selfish of me? It probably is.
I understood you were being metaphorical, but I would also counter that how you describe the US system as being inevitable, or just social physics, does strike more of an ideological tone in relation to our politics than reflects a scientific fact, which is fine. We all have our experiences and biases. I have to work with all kinds, and I’ve learned almost all have good reasons for their ideological leanings, and have empathy.
In regard to the 70s, I guess what I was trying to point out was that macro dynamics are often difficult to discern. You are a very intelligent person who has studied these dynamics and have come to a particular conclusion. I’m sure there are a group of economists that would agree. Then we have other just as intelligent people that see it from a different angle and come to an opposite conclusion that seems perfectly logical to them, and a group of ecnomists agree with them. It’s similar to the analogy of two people looking at the number 6, one from below, one from above. One sees 9, one sees 6. Who’s correct? Depends on what position you take. Economics is filled with those kind of dual perceptions and conclusions, as well as policy results. You have pointed out what could be horrible policy results from MMT’s fiscal policy prescriptions, I have pointed out horrible policies that have resulted from monetarism. Neither one of us is entirely wrong or right.
I also have strong reservations in regard to MMT’s prescriptive side for many of the reasons you have mentioned. I don’t see a job guarantee as ever working out the way MMTers envision. The private sector does a good job of matching employers and employees efficiently and productively. Or, at leat it used to. I do think we need to move to a universal healthcare coverage. Too many employees seek employment for benefits at the expense of what might be a better employer/employee match. So much efficiency and productivity lost! There are also too many market failures with healthcare, and in reality we already have universal coverage, just in a way that wastes a lot of resources. That’s my bias now showing, but I also think its grounded in a respect for private sector markets. There is so much needless aggregate spending on duplicate services, advertising, administration fees, artificial complexity, and artificial competition in insurance and medical services. I agree with Mosler on healthcare, what we have is a socialized system masquerading as a private system. I’m sure people might see it the other way around, but again, we have so many other countries as better examples.
I guess what I am trying to point out is that it is frustrating to see people debate and argue from different positions that are not grounded in the same reality. It would be different if these positions were debating the same set of facts, but often they are not. For instance, we have too many people debating, where one person or group is using gold backed fixed convertible currency mechanics to describe outcomes and policy relating to fiat floating nonconvertible currencies. There have been so many wrongly applied mechanics to draw parallels between the US’s debt concerns with countries like Venezuela and Greece. The economies and monetary systems and how debt is and was owed are very different. It’s one of the reasons I posted the Mosler-Murphy debate. I watched the video when it first came out five years ago because I had become interested in MMT, and I found the debate fascinating because of the positions they take. They are both very intelligent but Mosler is there to debate mechanics of the system we have, Murphy wants to debate why we should have a different system. I think Murphy loses the debate because Mosler keeps pointing to reality, Murphy keeps pointing to a reality he would like to have. Both are fine positions to take, but then the debate should really be framed differently.
I agree with you regarding recessions. I would add that Keen’s view on the matter, which coincides with Minsky, is also a driving factor. It can be malinvestment, as you say, and-or it could be just excessive private sector borrowing that overshoots rational expectations, with private debt residue building up with each recession, leading to larger bubbles.
To return to checks and balances, this is where we are in complete agreement. We are in agreement that going back to gold would be very difficult, which is why I brought it up. I think we need to move beyond the arguments for a gold standard. The system has changed and going back is not really a viable option. I also agree that MMT hasn’t gone far enough when they claim inflation is the appropriate or logical constraint on fiscal policy. It’s too ambiguous as a political constraint. So, I’m curious to see how their prescriptive side evolves going forward.
I’m sure you agree that endless campaigning, lobbying, and celebratizing politicians at the federal level is wearing us all out. Again we can look to other countries. Canada has much more strict campaign and lobbying laws that could be adopted. Although I understand your grenade analogy, I think the same applies to monetarism. I think going down the same road of monetarism is going to create more wealth inequality, more handing of power to corporations, and more bailouts from bubbles bursting that assymetrically hit the poor and middle class. That’s also not sustainable.
Where does that leave us? I guess where we started. But, I do think MMT has been a good perspective to inject into the debate, which is why I encourage everyone to read it. There are even factions among MMTers which are interesting. Thanks for your comments.
TD-
Sorry for the delay in responding. I got caught up in fixing some bugs and only now have the time to reply.
how you describe the US system as being inevitable, or just social physics, does strike more of an ideological tone in relation to our politics than reflects a scientific fact, which is fine. We all have our experiences and biases. I have to work with all kinds, and I've learned almost all have good reasons for their ideological leanings, and have empathy.Heh. You are such a good person. My ideology, such as it is, tells me that people will act in line with the incentives that are provided by the system they are operating in. My observation is, it is a the rare human being that acts contrary to the systemic incentives. Such people form the basis of religions, get whatever passes for "sainthood" in their culture, or are recognized (usually after they've passed away) as being truly exceptional. But for the rest of humanity, to project the outcome for a situation, all we really need to do is look at the systemic incentives for the participants, and the outcome will - generally speaking - be reasonably easy to predict. We just have to be clear-eyed about what those incentives really are. We also have to understand roughly how humans are built - how much is evolutionary biology, how much is initial programming, how much is societal thought-shaping, etc. If that's ideology, I'm not sure which label to slap onto it. Maybe "real-life-ism." Or "how-the-world-works-ism". I'm definitely guilty of having such an ideology, and - I thank you for your empathy in advance.
I guess what I am trying to point out is that it is frustrating to see people debate and argue from different positions that are not grounded in the same reality.Once again, you are frustrated about some general thing that - I'm not sure applies to me. Please. Address issues with me directly. Tell me what you disagree with, and why. Now then, on to points of agreement. Some, even over-agreement. I'm sure you agree that endless campaigning, lobbying, and celebratizing politicians at the federal level is wearing us all out. [You don't go far enough. The current system has been engineered by corporations so that they can capture politicians to do their bidding. Getting money out of politics is requirement #1 for reducing corruption to a more manageable level.] I think going down the same road of monetarism is going to create more wealth inequality, more handing of power to corporations, and more bailouts from bubbles bursting that assymetrically hit the poor and middle class. [If by "monetarism" you mean Fed's ever-increasing mission creep - which is now all about money printing to prop up the markets, as well as dropping rates to zero for long periods of time, I completely agree. If you mean getting rid of the Fed as the buyer of last resort of good corporate debt during a crisis, then I don't agree.] I agree with Mosler on healthcare, what we have is a socialized system masquerading as a private system. [I'd go further. We have a government-supported sickcare cartel, and sub-standard care for actual people at twice the price other countries pay. And we don't cover everyone. Its utterly ridiculous - it is literally the worst healthcare system ever. And the sickcare cartel owners are getting extremely rich as a result.] Again, things are all about incentives. I'm glad we agree that checks & balances are required before politicians are given the printing press. And I'm not talking about "the vote", I'm talking about something that has the ineluctability of physics.
I guess what I was trying to point out was that macro dynamics are often difficult to discern. You are a very intelligent person who has studied these dynamics and have come to a particular conclusion. I'm sure there are a group of economists that would agree. Then we have other just as intelligent people that see it from a different angle and come to an opposite conclusion that seems perfectly logical to them, and a group of ecnomists agree with them.I don't accept that as a reasonable response. If you disagree with the specifics of my analysis, then we can trot out the charts and pick them apart and see what makes sense. I will not accept that 'there are smart people on both sides that say different things" as any sort of compelling argument. That's a logical fallacy - an "appeal to smart-people-on-the-other-side authority." Often there really is truth. In those cases, by exploring the boundaries of our current understanding, we can end up refining it and moving closer to it. What I do believe is that I should be willing to listen if you go through the effort of presenting a case. It actually benefits me to do so, since I'm more interested in how things really work than I am about being right. Or rather - I really do want to be right, and sometimes that requires changing my mind when a new theory comes along that fits the facts better. Sigh. This got long. Thanks for reading this far and playing along with me.
https://news.grabien.com/story-msnbcs-green-new-deal-forum-devolves-hour-long-pitch-sociali
Over the course of the next hour, Rep. Ocasio-Cortez, or AOC, as she’s nicknamed herself, made clear that her original Green New Deal proposal — a widely mocked outline that called for everything from “retrofitting” every building in America to single-payer health care to a universal basic income (including for those “too lazy” to work) to slavery reparations to a federal jobs program to so much more — was indeed completely serious. When a former congressman at one point suggested the priority should be on saving the world’s environment, and that the universal basic income component of AOC’s Green New Deal could come later, the crowd booed and jeered him. AOC, a firm believer that Planet Earth only has 12 years to be saved from a global warming-sparked apocalypse, opened by telling Chris Hayes “there will be no future” if the United States fails to adopt her proposal: “So this issue is not just about our climate,” she acknowledged at the outset. “First and foremost we need to save ourselves, period. There will be no future for the Bronx. There will be no livable future for generations coming, for any part of this country in a way that is better than lot that we have today if we don’t address this issue urgently and on the scale of the problem.” AOC said the panoply of popular progressive proposals making up her Green New Deal — free college, free housing, single-payer health care, “social and racial justice” — are all inextricably intertwined, and that it’s foolhardy to pursue them individually... But the most revealing moment came when a former Republican congressman (who is now a global warming activist), Bob Inglis, suggested a more pragmatic approach to getting the Green New Deal enacted would be to focus first on the environment and later on things like a “universal basic income.” The crowd, already juiced with idealistic calls for a socialist remaking of the country, began heckling and booing him, with someone audibly shouting “moron!” The chaos only stopped when AOC interjected. But these participants were only responding to the atmosphere she created. Inglis’ pitch for pragmatic socialism instead a total revolution went nowhere; AOC devotees view anything short of a complete remaking of America as selling out. Add it all up, and AOC is indeed pitching a radical remaking of American society — from one that’s historically defined by individual liberty and free markets — to one defined by state-control and eco-theology. It’s a plan that leaves no facet of Americans’ daily lives untouched by the long, judgmental arm of Washington. The Green New Deal’s scope and mandate for legislative authority amounts to a radical grant of power to Washington over Americans’ lives, homes, businesses, travel, banking, and more.
Tom-
Add it all up, and AOC is indeed pitching a radical remaking of American society — from one that’s historically defined by individual liberty and free markets — to one defined by state-control and eco-theology. It’s a plan that leaves no facet of Americans’ daily lives untouched by the long, judgmental arm of Washington. The Green New Deal’s scope and mandate for legislative authority amounts to a radical grant of power to Washington over Americans’ lives, homes, businesses, travel, banking, and more.My goodness, individual liberty and free markets. I'd sure love for that to be where we are. I haven't seen a free market for decades. We live in The Globalized Company Store. And that's precisely why there is such a resonance behind the socialist aspects of the GND. When the healthcare system is so horrid and predatory it steals 20% of the GDP and we end up with shorter lifespans than all the other systems out there while making the thieves rich...we should not be surprised when people go for socialism. Seriously. I'm sick to death of all these allegedly "pro free markets" weasels who totally ignore where we really are, and what is really going on. They are just as bad in my eyes as all the Russia-gate believers in the MSM, and the scumbags that raise the price of insulin by 10% every year. Yes, the GND is all a tactic by the socialists, but there would be zero traction on socialism if our competition-free cartel capitalism weren't so horribly predatory. Elizabeth Warren knows this. She is getting attacked because she wants to break up Amazon, among other monopolies, in order to encourage competition. She's an old-time Democrat. In this, I'm totally with her. She's the only one talking about this issue.
When someone claims or implies that we have free markets, laugh?
Make it clear not only that they are being ridiculous, but that they are also at war with everyone else there?
Good article on Rolling Stone, linked to on PP a few days ago.
“Today with other members of Congress, I’ll be filing a Green Real Deal — a commonsense rebuttal to the Green New Deal,” he announced at a press conference on Capitol Hill. “The Green Real Deal rejects regulation as the driving force of reform, and instead unlocks the potential of American innovation and ingenuity.”“The question for America is pretty simple. Either we want a bunch of bureaucrats in Washington telling us what we can’t do, or we empower American innovators to unlock things that we can do,” he continued.
He said his proposal establishes four platforms for American innovators to “utilize, exploit, and deploy for their success.”
Thanks for posting that link, Tom. I hadn’t heard of that and was interested to look into it.
Even though, philosophically, I’m much more in support of the overall approach of the Green New Deal, I saw a bunch of things that seemed like good ideas in ‘Green Real Deal’, some of which matched approaches of Green New Deal, (like incentivizing energy efficiency, modernizing the national electric grid, storage, distribution), and some good ideas not focused on by the GND, like protecting the intellectual property of innovators and cutting red tape and regulations as necessary and appropriate to be able to rapidly build out renewables and infrastructure as needed.
I haven’t had a chance to read it through completely yet, but it’s clear that like GND, it’s also an aspirational (outline/resolution) document that refers to ‘investing in’ a lot of things, but doesn’t say where that money will come from, how it will be incentivized or how much it would be. Like GND, I doubt it would pass the current Senate either. We’ll all be able to have better discussions of these things when both the costs of taking various actions and the costs of not taking the actions are more clearly defined and estimated.
My overall reaction is that it’s nice to imagine that a ‘free market’ approach that doesn’t cost much could create the massive economic shift in the time required, but IMO that’s clearly a pipe dream. The ‘free market’ has massively failed to deal with climate to date because ‘the free market’ didn’t even want you to know there’s a climate crisis coming in the first place, and still spends a lot of money to make sure you don’t think one is. While knowingly and successfully lying to the public denying the grave threat of human-caused climate change for decades, (because it’s ‘bad for business’), the fossil fuel industry has instead, as documented by Chris, Art Berman and others, sucked up trillions of ‘free market’ dollars from the Fed/Wall Street and put them into crony capital, unwaveringly money-losing operations in the US building out massive, built-to-fail, environment trashing fracking operations and infrastructure that made all its banker and scammer friends rich. Of course, these money-losing ops have provided temporarily beneficial support for the US economy, including lifting energy from the ground, but represent just another pernicious form of borrowing from the future - in this case via burning black gold while helping poison the global ecology with greenhouse gas. Makes no sense.
Those trillions could and should have been gently directed by government incentives ages ago gradually moving us toward a much more well-thought out, renewable energy economy. Markets are way too short term focused and corrupt to be able on their own to incentivize the innovation required to be where we need to be to avoid climate disruption a decade or two from now on their own. They’ll need likely not just massive tax or other incentives put in place by governments at all levels, but also actual taxation and reallocation of funds into infrastructure and other projects. It’d be great if we could find ways to make sure that neither “bureaucrats” or Wall Street control the process. Any process won’t be easy at all. Not doing it would be much worse – the much bigger disruptions just come a little later.
In any case, I’ll be interested to see the details of the proposal that shows amounts of money involved and where the big incentives required come from, if they ever are laid out.
They make a the same general point that I do above, that Gaetz’ plan doesn’t show any incentives that would actually cause the ‘free market’ to make changes at anything approaching the needed scale in the next decade or so - not even a carbon tax. The New Times just lays it on more harshly:
https://www.miaminewtimes.com/news/florida-congressman-matt-gaetzs-green-real-deal-climate-change-plan-absolutely-sucks-11139299
Florida Rep. Matt Gaetz's New Climate "Plan" Sucks The problem with the plan is it sucks, top to bottom. If America relies solely on the provisions in Gaetz's plan, the planet will cook and the seas will swallow us whole. Period. Gaetz claims his bill is a more "common sense" alternative to Ocasio-Cortez's Green New Deal, but in reality, it's Gaetz who's living in a dream world. That's because Gaetz's plan includes literally no carbon-emitting regulations at all. Gaetz did this on purpose: He's transparently stated that he hopes to save the world without all those pesky "government regulations" in Ocasio-Cortez's plan. Gaetz's ideas might have been useful in 1950, but it's simply too late in the game for Americans to consider a plan as completely toothless as Gaetz's in 2019. "The Green Real Deal rejects regulation as the driving source of reform, and instead unlocks the unlimited potential of American innovation and ingenuity," Gaetz said in D.C. yesterday at what appeared to be a sparsely attended press conference. ... [V]oluntary restrictions on carbon polluters simply haven't worked. The U.S. government for years has tried to solve the climate crisis through weak regulations and largely ineffectual subsidies to clean energy producers, but fossil fuel companies have shown again and again they have little interest in weaning themselves off oil and gas. If anything, the opposite is true: Carbon emissions have steadily increased over the last decade, despite ample evidence that carbon pollution is cooking the planet. In fact, humans set the world record for CO2 emissions just last year.
Trump is the only person fighting for the low-wage worker. Dems sure as hell aren't. "Unlimited immigration" - all in the name of political correctness and new Dem voters. The 1970s Dems who were staunchly against illegal immigration are rolling over in their graves at this point. And of course nobody expects Republicans to support working people. They certainly never have before.
rich-
My sense is that the Republicans are totally in favor of unlimited immigration for just the reasons you lay out - it benefits their corporate donors. I got the sense that Ryan told him to wait and pass the rich people tax cuts first. Trump did, and lost his chance at the wall, just as you say. He is probably quite annoyed at himself for listening to Ryan. I credit him with more good will towards the working class than you do. Its just a matter of how one interprets events.
I do not think there is much will in Congress, on either side of the aisle, to restrain immigration. Both sides donors benefit. So Trump has to run around the country getting people to notice. And now, largely, people are starting to notice. “Importing a bunch of new low-wage workers is bad for the wages of the existing low-wage workers.” Who would have guessed?
Trump had no chance of winning that government shutdown. That’s because, behind the scenes, Republicans were against him too, and they relied on the independents to make them look as though they were supporting him, but - if the chips were down, I suspect his support was a lot weaker than it looked.
That’s how I read it anyway.
If there’s still life in this thread, please consider taking the time to read a really useful blog post on MMT (once again from Bill Mitchell) that addresses a number of the common challenges: http://bilbo.economicoutlook.net/blog/?p=42170
In particular he rebuts one of the key arguments put forward here by davefairtex - the unwillingness to give politicians greater powers. The headline response: so should we tell each other lies about the way the world works, for fear of politicians taking liberties?
All the best,
Matt
I’m definitely not up to speed with MMT. Is the public bank movement part of it? If it is, PP should interview Nomi Prins again since she wrote this in strong support of it:
https://truthout.org/articles/ive-seen-goldman-sachs-from-the-inside-we-…
The fact that Rector recieved +14 for his grumpy comment makes clear our predicament. We the grumpy old men of PP (note to self) are working hard to understand what the current “system” wants to do, how well it’s doing it, and where it wants to take us. Now we’re trying to figure out what the 30 somethings of today want to do and are figuring out how to do it, knowing: Python, Java, C/C++, JavaScript, Go programming language, R, Swift, PHP, C#, MATLAB, etc. not to mention Rust or Kotlin.
Politics is a lagging indicator.