There's no one in the progressive movement (other than some MMT folks) that have a serious rebuttal (no...a refutation) to the conservative, deficit hawk, argument. Even Paul Krugman, who is quite prolific when it comes to challenging the conservative arguments on deficits, government spending, entitlements and such, will set himself up for destruction each and every time when says things like, "The debt is not a problem in the short term, but we need to get long-term structural deficits under control."
It is that "long-term" stuff that undermines his efforts.
Once progressives agree with conservatives that there IS a problem, never mind if it has to be addressed now or later, then conservatives just easily come back and say, well, if you agree there is a problem, then why don't we just fix it now and be done with it?
Until we get a progressive that understands our monetary system; that understands the FACT that we can't go broke and that deficits add to the financial balances of the public, and go on to become part of the inheritance (and wealth) of current and future generations, as opposed to being a burden...until that happens, we will lose every, single, time.
27 comments:
Excellent point!
You can't expect everyone to agree. Krugman obviously disagrees with some of MMT, but he still makes a strong case against deficit hysteria nonetheless. The problem is people in the deficit hysteria camp can't be bothered to even try and understand his argument, let alone MMT.
Krugman and other economists need to read, Scott T. Fullwiler, Interest Rates and Fiscal Sustainability (July, 2006).
y, they are not going to try to understand because their ideology rules it out. This is a clash of ideologies and whichever ideology frames the public debate wins politically, which is where it counts.
The task is not winning arguments but reframing the debate.
I agree with Tom here "their ideology rules it out"…
what a shame.
when I first found MMT I held everything I thought I knew at a distance and allowed the logic to win me over. this is not hard to do, intellectually.
''Of course the entity that creates the money can't run out!''
It just goes to show how propagandized and brainwashed we are that that simple idea isn't an automatic light bulb for everyone. a game-changer.
but if you're career is on the line? maybe ideology holds precedence over truth.
Right, and as soon as the insolvency issue is dispensed with, then the inflation bogeyman is trundled out.
There is also the limitation on real resources issue, too, which is actually the only serious issue we face, and the big problem here is effects of externalities of which the dominant ideology is in denial.
So first we have to dispense with the inflation bogeyman and then get down to the issue of availability of real resources in the present and future, which is what an intelligent debate needs to be concerned with as humanity faces the increasing likelihood of global warming getting out of control and creating catastrophe.
Should add that even climate change skeptics and deniers should be concerned with the adverse health effects of environmental pollution, as well as the economic costs that are being socialized.
Absolutely true. Abba Lerner made the exact same point decades ago. Once you admit there's a problem, you've lost the entire argument. Krugman is ultimately no help because his argument for increasing debt today even though it ultimately needs to be reduced will convince few outside the left. Debt, after all, is immoral and who wants to bankrupt our children.
Unless someone is advocating a post-Capitalism society that is something like The Venus Project's resource-based economy, then I have a hard time taking people seriously that talk about "real resources"…
Capitalism is extremely inefficient (planned obsolescence) and inherently exploitative of the world's real resources. Of course the free-marketeers don't care about that, only 'efficient' distribution, but even that is questionable.
The problem goes back to the Continental Dollar. Benjamin Franklin understood that it needed to be supported by accepting it for taxes, but the Continental Congress ignored his advice and did not assume for itself the power of taxation. The collapse of the Continental ruined a lot of people, including Andrew Jackson's mother. Fiat currency had proved its worth in the colonies, starting in the 1690s. But the collapse of the Continental soured a lot of people on it, including Jackson.
There is a strain of hard currency fiscal conservatism, combined with social liberalism, in the Democratic Party, going all the way back to Jackson, and including Carter, both Clintons, and Obama. They, like Merle Haggard, "wish a buck was still silver".
In addition, this combination of fiscal conservatism and social liberalism has been used for decades to counter arguments that "entitlements" are "irresponsible", that politicians just want to give people goodies, regardless of the cost. Thus the prototype of the fiscally responsible liberal has not only arisen, but been put into practice by Clinton and Obama. That prototype, that balancing act, has a lot invested in it.
Unless someone is advocating a post-Capitalism society that is something like The Venus Project's resource-based economy, then I have a hard time taking people seriously that talk about "real resources"…
Capitalism is extremely inefficient (planned obsolescence) and inherently exploitative of the world's real resources. Of course the free-marketeers don't care about that, only 'efficient' distribution, but even that is questionable.
That's why we need to be creating a post-capitalism frame. We already live in a world of mixed economies and pretend that we are living under "free market" capitalism when that is far from the truth and the ideology just gives power to those who extract rent in the name of "profit" from "enterprise." It's just a carload of BS.
High tiime to get real.
That's why we need to be creating a post-capitalism frame.
Go on TV and say that. I love it. You see, MMT is NOT a "monetary theory".
Your theme should be "somehow, someday, somewhere". Kinda like Communism.
Bob, I assume the you don't "believe" in climate change or think that markets will deal with it just fine and dandy, because after all it's the survival of the fittest.
Here, here, I could not agree more. We need to say what Warren said the other day:"There is no long term deficit problem !!!!!". And leave it at that. Stop rushing in to say something like "Well, you know I did not say it won't cause inflation". Oh goody, lets move on, nothing new to see here. We want to qualify truth. Strange.
The U.S. government can never become insolvent in dollar debts and can buy whatever it wants in dollars. Let it sit there. Truth.
There will come a time to explain it further but not about two minutes later. Nonsense.
"MMT is NOT a "monetary theory".
Yes it is.
http://moslereconomics.com/mandatory-readings/
http://www.amazon.co.uk/Understanding-Modern-Money-Employment-Stability/dp/1845429419
http://www.amazon.com/dp/0230368891
http://neweconomicperspectives.org/p/modern-monetary-theory-primer.html
http://mmtwiki.org/wiki/Main_Page
Jonf,
Most of these "close to MMTers" are also libertarian so they just can't help themselves in this regard...
They are "libertarians of the left" so they are attracted to the political solutions, but can't go as far as recognizing the absolute fiscal authority imbued in our govt, the libertarian in them sabotages their thought process - they just cant go that far...
They then become hypocritical and then their political ideas can be attacked easily by the right-libertarians as Mike points out here as it is "conservative" to address problems "up front and early", "why wait?" type of thing which is textbook right-libertarian...
The common denominator in this equation is libertarianism, it has run amok.
rsp,
"That's why we need to be creating a post-capitalism frame."
Tom,
I look at Dan's "Public/Private" initiative as a good candidate for such a "frame"...
The key thing will be to somehow judo the libertarianism in the process...
right now libertarianism holds sway and when you put the word "public" in there the right-libs just cant take it and are currently able to slap it down...
rsp,
Sprawl is caused by funny money loans for houses as, among other things, an “Inflation hedge”, plus government freeways and public schools that push (and subsidize) people moving farther and farther out from the core cities. The US military, having been “unconstrained” due to Keynesian policy and funny money, is the biggest gas guzzler in the history of the galaxy.
Further, the funny money, the subsidies (like government flood insurance in areas where no one should build) and the destruction of private property rights make it virtually impossible to properly "cost" and account for the various forms of pollution.
If there is “climate change”, we sure know whom to blame it on.
If there is “climate change”, we sure know whom to blame it on.
I'm sure that the intense propaganda campaign in the media funded by Big Oil and the CoC have nothing to do with sewing disinformation about the onset of environmental catastrophe.
Not that I don't agree that a lot of the problem can be trace to government collusion with business and finance due to crony capitalism, corruption, and the revolving door. Until we get the money out of politics, we are stuck in this.
So, Bob, in your magic imaginary barter world there aren't many houses, freeways or schools because of shiny metal?
There's no pollution because the oceans have been sold to BP and the skies belong to Kock Bros and because shiny metal?
There's no war or armies because, like, just because and shiny metal?
There's no climate change because your magic imaginary barter world shiny metal is magic imaginary magic shiny metal?
y,
If we take Bob seriously, then EVERYTHING must be privatized. Literally everything. Every inch of land, every part of the ocean, even the air in your yard is yours!! (yea, he said that)
Therefore, any degradation beyond one's own property is "aggression" toward someone else's property, and the perpetrator would then be legally (and financially) responsible for it.
(note: "legally" responsible…)
BUT (!)...
All government and public property is unwarranted aggression. This has to be the case. If we allow just a little bit of government, just a little bit of "public" control over ANYTHING, then the flood gates are open and we're all Communists...
As someone else noted, Sepetus7 I think, Bob takes his perspective on 'property rights' as objective, but also states that all valuation is subjective. Hilarious.
There are good reasons why the most powerful countries and empires in the world had and have strong central governments (of one kind or another). It is the most effective form of defense (and offense).
Bob & Co. are living in la-la-land. It's a fantasy.
Bob, can you name us one country/empire/society/etc. that has sustainably and successfully lasted without some sort of strong central authority?
No? Of course not. Because it's a weaker form of organization. Some group "over there" decides to create a strong central authority and then they use it to to dominate those who don't have strong enough centrallized decisions making.
In my mind, we're stuck with this. At least for the foreseeable future. So we might as well attempt to use the currenty system as best we can. MMT has a lot to offer in this regard.
On a realted note: all of what I just said not only seems true for government authority, but also for corporations and businesses. They are all "centrally planned" …and, even if we got rid of their hierarchical structure and replaced the businesses model with democractically worker-owned organization, decisions would still be made "centrally"… there'd just be more voices at the table.
If we take Bob seriously, then EVERYTHING must be privatized. Literally everything. Every inch of land, every part of the ocean, even the air in your yard is yours!! (yea, he said that)
That is Murray Rothbard's position.
An example of the lack of enforcement of the non-aggression principle:
http://www.flickr.com/photos/bob_roddis/8525140770/in/photostream
things are awfully simple in la la land.
maybe we should apply evolutionary ideas to this disagreement.
Natural Selection: those traits that promote survival and reproduction, tend to get passed on to following generations.
Note: we might not like the outcome, but it's hard to argue that what is present has proved to be stronger evolutionarily.
This absolutely does not mean what we have now is hear to stay. If anything, change is the constant, be it intra or inter generational.
Question: are we evolving toward Bob's ideal?
Seems to me it got passed along the way to where we are today because it was comparatively unfit.
Bob, those Spaniards were hunting for gold and silver. As in the case of the Californian gold rush, they just killed any natives that got in the way of their lust for shiny metal.
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