My policy solution is that economic liberalism and political liberalism are incompatible. So-called capitalism (including capital and land ownership) cannot coexist with genuine democracy as rule of, by and for the people based on egalitarian community.
The economic system that corresponds with so-called capitalism is plutocratic oligarchy, for which there is ample evidence in sociology and political theory. The economic system that corresponds with genuine democracy as rule of, by and for the people based on egalitarian community is so-called socialism.
Choice between them is a value judgment, and in actuality such choices are generally made based on power relationships in social groups.
I would define "capitalism" as the range of economic systems that favor capital over people, and "socialism" is the range of economic systems that favor people and the environment over capital (including capital and land ownership). But the devil is in the details, especially since under the present configuration in most of the developed world, capital controls the power and determines institutional arrangements and application.
Considered as an analytical tool that studies various monetary systems and their economic and financial implications under different institutional arrangements, MMT is policy neutral, since it is chiefly descriptive.
As an macroeconomic theory that prioritizes full employment, it is value-based. Prioritizing full employment favors workers (the majority of people in most societies) over capital (ownership of means of production and finance dominated by a few).
Other economic theories that claim to be more "naturalistic" do not make such an assumption but leave outcomes to so-called free markets in models that relegate government to the function of umpire with laissez-faire as the basic rule. However, privileging "naturalism" over, e.g., system regulation based on "control theory," is also a value judgment. Proponents of such systems view MMT as socialistic.
On the other hand, some critics argue that MMT economists in general assume a capitalist model and stay pretty in the box.
MMT is policy neutral, Tom Hickey
ReplyDeleteYeah, right - till you try to pry away:
1) INCREASED privileges for the banks (Warren Mosler),
2) wage-slavery to government for their victims (Bill Mitchell), and
3) taxes on the non-rich to curb price inflation should it occur.
As for MMT being socialist, that's a laugh given the above policy imperatives.
Phase 1 MMT policies
ReplyDeletePhase 2 ?
Phase 3 Socialism
Isn't that right, Tom?
Underpants Gnomes
Phase 2 is a kinder, gentler capitalism.
ReplyDeleteHowever, there are those who have a different idea:
https://dilbert.com/strip/1998-10-17
My policy solution
ReplyDeleteTom's "policy solutions" read like technical descriptions of intractable problems.
“ My policy solution is that economic liberalism and political liberalism are incompatible. ”
ReplyDeleteThe Thesis of “economic liberalism “ and the antithesis of “political liberalism “ are argued in a dialogue and that is the solution in a dialectic methodology...
Tom is not trained in a technical approach... PhD Philosophy from Jesuit Georgetown they train in this dialectic or Platonist type of methodology...
Think of the council of Nicaea where they came up with the trinity doctrine where “1 is 3 and 3 is 1...”
You can’t go over to them then and point out technically that 3 does not equal 1...
You can’t change the methodology in the middle of the discussion over to a technical analysis...
You either have to approach the matter technically or approach the matter platonistically/philosphically...
ReplyDeleteThey are two different perhaps competing methodologies...
Trouble happens when you try to blend them...
And the latter should never be applied to material matters... its the "broad gate that leads to desstruction" from scripture.... you try to do your material work that way and eventually youre going to blow yourself up... electrocute yourself... have the building collapse on your head... blow up on the launch pad... poison yourself... GFC bankrupt all of your depositories... etc...
It's a description, not a dialogue.
ReplyDeleteThese old terms (liberalism, socialism) have been analysed to death. Nothing new is being said.
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ReplyDeleteMMTers claim to provide an accurate lens on monetary operations, one that is ideologically unbiased. If the right wing wishes to use the power of the purse to increase inequality, they can (and already have) made use of those monetary arrangements to enrich themselves. MMT exposes this for what it is – a policy choice.
ReplyDeleteThe point is not that taxes on the wealthy cannot produce a better society – I certainly believe they can reduce inequality to an extent – but that if your goal is a more equitable and efficient society, then the aim has to be not just redistributing incomes or wealth, and rather helping the earning classes seize control of the means of production. That requires a different set of policy tools, ones that MMT clearly identifies (and which Governments can use – if they are so inclined).
I also think it is important to recognize the contributions of MMTers such as Richard Murphy on tax, accounting and political economy.
“Nothing new is being said.“
ReplyDeleteThat’s because no adjustment or correction is ever made in this method...all that may happen is some new students may eventually synthesize the two or three Theses that are opposing each other...
ie “new Keynesian” “neo Chartalism” “neo classical synthesis”, etc...
Its like AA here just droning on and on about some BS Old Testament failed Thesis... never discards that old failed approach and goes back to the drawing board to create something new... doesnt work..
ReplyDelete"but that if your goal is a more equitable and efficient society,"
ReplyDeleteMaybe equitable but I'm calling BS on your use of efficiency here...
The current arrangements create more efficiency... corporations/firms produce more efficiency in the accomplishment of any task...
It would be more efficient to just euthanize the non-productive... yet there are many firms making BIG munnie on sustaining the non-productive people... BIG munnie...
ReplyDelete