Thursday, July 29, 2021

Bill Mitchell — Booming growth in Britain (Brexit?) but child poverty rises (austerity)

Some setting the record straight on MMT.
MMT is an economic framework for understanding how the macroeconomy works and the role of the currency-issuer in the monetary economy.

It has a rich history and provides a novel way of generating that understanding.

Its predictive capacity is excellent over 25 or more years. Many economists and observers keep saying they knew all this stuff but if you go back through the historical record, they were not rehearsing these ideas or conclusions until recently.

But MMT is not a ‘movement’, nor, is it a progressive agenda.

I keep reading things like “MMT advocates taxing the rich”.

It doesn’t.

What an understanding of MMT will allow one to conclude is that there is no contingency between the provision of public services or infrastructure by government and tax revenue it might receive from high income or wealth individuals.

MMT also provides a coherent aggregate explanation about the role of taxation in fiscal policy, which excludes any causal association between the government receiving tax revenue and spending.

That is it.
MMT is agnostic about where the tax revenue comes from....
MMT is not a policy framework. That is a different issue. 
The body of knowledge does not cover questions of incidence, progression or regression and all the other facets of taxation policy and structure that experts in that field are interested in.

When I talk about the need to ‘tax the rich’, I am expressing a value system, which is quite separate from when I am teaching the principles of MMT.

I want to tax the rich to ensure they have less financial resources so they can spend less on things like lobbying governments, influencing elections, dominating the media etc....
Bill Mitchell – billy blog
Booming growth in Britain (Brexit?) but child poverty rises (austerity)
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia


NeilW said...

The tax the rich argument annoys the bejeezus out of me. You *levy* the rich because you want them to have less money. That's it.

Tax is there to Release the Resources and Drive the Denomination. Nothing else.

Jeff Bezos doesn't have a secret stash of doctors and nurses in Amazon Warehouses.

If there aren't any unemployed doctors, you have to make them unemployed before government can hire them. If there aren't any doctors you have to make the training capacity unemployed before government can hire it.

"Every medical student also has to undertake clinical placements in the NHS in the last three years of the degree.
So universities are given an allocation of places which they cannot exceed."

If you run down a service and spend the seed corn, the capacity to train is diminished. Training requires skilled people training, not doing the job. No amount of tax can fix that.

AXEC / E.K-H said...

What is MMT? ― Rectifying Bill Mitchell
Comment on Bill Mitchell on ‘Booming growth in Britain (Brexit?) but child poverty rises (austerity)’

“Social media is, of course, awash with Modern Monetary Theory (MMT) and a host of different characters have made it a goal to become MMT proponents, which is a good thing in some respects.”

It is pretty obvious that “MMT proponents” on social media and elsewhere are overwhelmingly agenda-pushers/applause-trolls/useful-idiots/sales-reps and #EconBlockers.#1, #2, #3

“MMT is an economic framework for understanding how the macroeconomy works and the role of the currency-issuer in the monetary economy.”

MMT got macrofoundations wrong. Because of this, the whole analytical superstructure is scientifically worthless.#4

“But MMT is not a ‘movement’, nor, is it a progressive agenda.”

MMTers present themselves as Real Progressives when it suits them, e.g. when they fight UK Labour. Actually, MMT is a movement of and for the Oligarchy.#5, #6, #7

“I keep reading things like ‘MMT advocates taxing the rich’. It doesn’t.”

No, MMT advocates deficit-spending/money-creation which is (because of the 3-sector Profit Law Q≡(G−T)+(I−S)+Yd) to the advantage of the Oligarchy and to the disadvantage of WeThePeople.#8

Egmont Kakarot-Handtke

#1 Economics, communication, disinformation

#2 Economists ― the Oligarchy's agenda pushers

#3 Links on MMT-Progressives push Wall Street’s agenda

#4 The unassailable formal refutation of MMT

#5 How Bill Mitchell stalks Jeremy Corbyn

#6 MMT: Corbynism is dead, British Labour is next

#7 Mission accomplished: Economists as useful idiots of the Oligarchy

#8 MMT, money creation, stealth taxation, and redistribution