An economics, investment, trading and policy blog with a focus on Modern Monetary Theory (MMT). We seek the truth, avoid the mainstream and are virulently anti-neoliberalism.
"We're out of money and cant afford it...."
Nice. I hope this video gets traction on twitter and other social media...Good work UMKC students!
This comment has been removed by the author.
You're right Franko. We can't afford to pay people to waste their time - and their morale - doing make work.It would be far better and far more just to simply hand out new fiat to the victims of the banking cartel, the general population. Better yet, also redistribute the common stock of all large US corporations equally to the entire US population since they were likely built with the stolen purchasing power of the population anyway. And let's not forget land reform ala Leviticus 25.
The UMKC students have been brainwashed.The video shares the same problem as every other JG sales pitch -- it goes on and on about the wonderful macro benefits of a JG while failing to satisfactorily describe the JG from a worker's point of view. Exactly what would a JG worker do? Where would the work be located? What about transportation to the jobsite? This is what the worker wants to know, but MMT has few answers.The video does not consider alternative forms of stimulus like a BIG or a Keensian Debt Jubilee.The video is flat out wrong to say that Hoover Dam was built by the WPA. Hoover Dam was constructed by private contractors.The WPA typically did small projects like city parks, while the larger New Deal infrastructure projects were usually outsourced to contractors. Many of the tasks performed by the WPA -- such as digging a utility trench with shovels -- would now be done by machines, which gets back to my question about exactly what kind of work would be performed by a modern day WPA? Unlike a MMT-JG, the WPA had 3 pay scales, depending on skill. I fully support direct job creation but the devil is in the details. It seems to me that the funding formulas typically proposed for the MMT-JG would rule out most construction projects because the cost of construction is largely equipment and materials, not labor. So JG work would likely be limited to services, liberal arts, and to CCC-style grunt jobs. Those types of jobs have their place but they would not be a good match for every unemployed person.
The video does not consider alternative forms of stimulus like a BIG or a Keensian Debt Jubilee. Dan LynchGood pun on Steve Keen's name! And yes, that's what we need from a JUSTICE point of view since the banking cartel cheats non-debtors too.But very few, apart from fascist gold-bugs with an even worse system they want to implement, see the injustice of a government-enabled system that will lend legally stolen purchasing power to someone SIMPLY because they are likely to be able to repay it to the thieves with interest.
Dan, I think that the bottom line questions are whether some kind of government intervention is possible to bring the huge waste of permanent UE to an end and if so what type of program or programs are most promising, e.g., JG, BIG, permanent income, etc. I don't think that there is any question about it being possible. The questions is which program(s) and how to implement them. As far as I can see, the MMT economist's aren't in agreement on this. Bill Mitchell would have a JG only, eliminating the dole, while the US economists would have some sort of combined program in which choice of a JG offer would be voluntary.I think that implementation could be compared with the implementation of SS v. Medicare. SS was relatively simple, since it just involved crediting and debiting bank accounts. Medicare was hugely more complex and bugs are still being squashed and features changed.I don't see a program to get to permanent FE as something like SS that could just be programmed in. It would be a work in progress that would go through many iterations and would probably take different forms in different conditions.It seems to me that what is important is acceptance of the concept and commitment to achieving it progressively. Owing to the changing nature of the economy, it would be continually a work in progress.The MMT economists have developed a pretty sizable literature on this and it's not like its an inchoate idea thrown on the table. A lot of study has gone into it already. Most critics seem to be unaware of this body of work and seldom address it specifically in terms of where it falls short and what it doesn't consider that it is material. For instance, MMT economists argue that a JG is preferable to a BIG due to inflation concerns with a BIG that the MMT (price anchor) JG avoids.There are also proposals for government funding of a JG and mostly state and local administration in recognition of different conditions that apply.As far as the WPA and CCC go, they were products of their time and were relatively successful then. I don't think that we can look back over half a century to look for contemporary design ideas.If this idea catches hold, there is plenty of room to debate different options for implementing it and testing these solutions, too. There is not going to be a finished product on roll out.
Moreover, I think that the JG has to be seated in a comprehensive view of overhauling the neoliberal model. It is not reformable and the introduction of JG is not going to fix the underlying issues that are leading to global dysfunction.This is not a new idea. Bucky Fuller, Kenneth Boulding, Adolf Lowe, Robert Theobald, Abraham Maslow and others wrote about this decades ago.I like Kenneth Boulding's idea of the grants economy. See The Economy of Love and Fear: A Preface to Grants Economics, Wadsworth. 1973.I think it is possible to think of public school teachers and state university professors, and administrators, etc, as on a government grants program instead of "competing" for work in the private sector. think of all the rest of government hiring, not the least of which is the military. Then there are volunteer programs like the Peace Corps.Non-profits are generously funded by government grants also. They are a source of employment, too.No need for "leaf-raking" to come to mind as the stereotype of a guaranteed job. That's how neoliberals want to cast it.
For instance, MMT economists argue that a JG is preferable to a BIG due to inflation concerns with a BIG that the MMT (price anchor) JG avoids. Tom HickeyThe government-backed banks are the source of most of the price inflation since they create most of the purchasing power OR worse they trigger recessions/depressions as they destroy in aggregate the purchasing power they created and also transfer the interest to those with a lower propensity to consume.But the JG proponents implicitly blame the victims who have been dis-employed and/or dispossessed of farms and businesses with their own (legally) stolen purchasing power.