Joe Biden may have just fallen for a fatal argument from Hillary Clinton's 2016 run.Unemployment is a systemic issue and needs to be addressed systemically. The MMT JG is a first step in this since it addresses unemployment locally and immediately. The MMT JG is not the solution to unemployment however, since alone it is merely an ad hoc measure.
Societies are social systems embedded in the larger global social system called "humanity, which is itself embedded in the ecological system of Planet Earth.
Economies, financial systems, and political systems, etc., are are subsystems embedded instrumentally in social systems as life-support systems. The chief purpose of biological systems, which included social systems, is reproduction of the system. This occurs on two levels. The first level is individual reproduction, which is biological. The second level is social reproduction, which involves transmission of knowledge systems and cultural systems.
One major aspect of the social reproduction of social system involves production, which involves "work." The type of work is determined by the economic system that is in place and functioning. This is a necessary social institution that forms a key aspect of a society's culture.
Societies are ever in flux since they are complex adaptive systems that respond to changing conditions. Thus the nature of work is also subject to change and a resilient society will respond to change quickly and successfully, while one that is less resilient will not. In addition, the response affects the quality of a society.
Conventional economic assumes near perfect elasticity of supply and demand that results in general equilibrium. However, this is only achieved by assuming a natural rate of employment consistent with price stability that results is a buffer stock of unemployed. This entails idling available real resources, which is wasteful, or in economic terms, inefficient.
The MMT JG addresses this based on replacing the buffer stock of unemployed that is assumed to control wage pressure with a buffer stock of employed and compensation package that serves as a price anchor. This eliminates the need to idle available resources and is superior on the economic level alone owing to improved efficiency, without even considering the social and political ramifications that affect the larger system and other subsystems.
The Week
Joe Biden tells coal miners they should 'learn to program'
Kathryn Krawczyk
Kathryn Krawczyk
Love the use of the phrase "idling resources" isn't that just what a Sub-Optimal Capitalism does with a vengeance? Hyman Minsky would love it too!
ReplyDeleteI hear the Chinese are into retraining, maybe they could help those miners.
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