Cullen has a fresh post that responds to a comment of mine here.
* This originally appeared as a comment on Mike Norman’s website regarding this silly Job Guarantee (JG) disagreement among the MMT crowd. Unfortunately, Tom Hickey deleted it several times for reasons unbeknownst to me (I presume because he didn’t want readers to see the truth in my comments).
Tom, you said:“If Cullen doesn’t write it up as a professional paper fleshing out his argument, no professional economist is going to take his blog comments seriously.”Read the rest ate Pragmatic Capitalism
There’s A Difference Between Theory & Fact
by Cullen Roche
Here is a repost of my response to Cullen at Pragmatic Capitalism.
My point was that for LVG's assertion to be taken seriously, if there would have to be a serious debate at a professional level, which there hasn't been. And if you don't plan to undertake one, then LVG's assertion is, shall we say, premature.
BTW, I have access to post at MIke's, but I do not have acces to delete the comments of others (or if I do, I am unaware of it). I did not ask Mike to delete your posts, and I have never ask him to anything about the blog other than to check the spam filter for possibly lost comments that people had reported. iIf someone else who has access to the delete button did delete your comments, I have no way of knowing or checking. If you have a problem with this, please contact Mike. If your comments were deleted, it could not possibly been my doing in any way, directly or indirectly.
My intention is to clarify, not to confront. This is a macro debate that is over my head to contribute to, and all I am doing is repeating what I understand from the professional MMT contributors. I am simply interested in keeping the record straight about MMT, on one hand, and commenting on policy options based on my ideological views.
Finally, there is still confusion over what MMT is. As JKH has observed, there is a monetary theory (Chartalism or state money and credit money, vertical v. horizontal money, etc) and a description of monetary operations (STF's general and specific) underling a macro theory based on analytics and empirics as a challenger in the professional debate among macroeconomists.
As a result, there is 1) a debate of monetary theory and operations (such as largely goes on here at PC), 2) a macro debate at the professional level, 3) a debate over the application of the macro theory as a policy instrument revealing a spectrum of policy options, and 4) a debate over various policy options on various blogs. I am capable of repeating what I have understood about the first two, but my background does not qualify me to enter the debate other than as a person concerned with economic policy. As citizens and people affected by economic policy choices, the debate about policy options is open to us all, I will argue about that based on my own views.
These four debates must be kept separate in the mind. I am aware of no MMT contributor claiming that the JG is in any way connected with the monetary economics that underlies the macro theory. The claim is rather that the JG as buffer stock of employed and price anchor is an essential aspect of the macro theory in achieving FE $ PS.
This is what the macroeconomists mean when they use the acronym "MMT." Confusion arises from ambiguity, since many people use "MMT" to mean the monetary description instead of the macro theory. Further complicating the matter is that MMT is also used for application of the macro theory as a policy instrument.
When MMT as a macro theory is applied as a policy instrument, the JG is essential as a policy tool in achieving FE & PS. Hence, MMT economists recommend it as a policy tool. The MMT economists have said that they would prefer to the complete package adopted by policy-makers but they admit that this unlikely. It is far more likely that pieces will be adopted first, like the sectoral balance approach and functional finance, which would be a huge advance. But they caution, don't blame MMT as an applied macro theory, if inflation results in the absence of a JG. They also say that the JG could be chosen first, which would also be beneficial. However, it should not be judged harshly if the rest of the theory is not adopted along with it.
If I got anything wrong in representing anyone else's views, I welcome correction.
I have stated that while I think that the MMT policy option of a buffer stock of employed is likely superior to a buffer stock of unemployed as MMT economists claim, I really have no way of assessing that claim professionally since I am not a macroeconomist and this is a macro claim. I accept that they have have correctly modeled it, and until someone establishes definitively that they haven't I'll accept that claim.
I have also stated that I am uncomfortable with the JG because it treats labor as a commodity and that is inconsistent with my views about human rights and the dignity of work. I also don't think that it is forward looking, for reasons that I have set forth recently in comments at heteconomist.com here and here. I have also stated that while I don't agree with your approach of full productivity and living standard, in particular because it ignores distributional effects and the transition through which the world is now headed, I agree with you about quality being basic.
Cullen replies here.
