David Jamieson — Bernie Sanders' adviser to join advisory group for new indy economics organisation

Professor Stephanie Kelton to join group of economics advisers to new MMT Scotland group

• New Scottish economics group to argue for Modern Monetary Theory policies for independent state.
• Some of the worlds most influencial MMT advocates to join advisory panel, including key Sanders 2016 campaign adviser Prof Stephanie Kelton.
• MMT part of a new wave of economic thought around the developed world.
• Heterodox economic school sets economic thinkers in opposition to Growth Commission Sterlingisation proposal.

ONE of the advisers to Bernie Sanders' 2016 presidential campaign will join a panel of prestigious economic advisers for the new Modern Monetary Theory (MMT) Scotland group being launched at meetings in Glasgow and Edinburgh in May.…

The advisery panel will also include Warren Mosler and Professor Bill Mitchell, two of the world's leading MMT thinkers, Professor Mathew Forstater of University of Missouri-Kansas City and Fadhel Kaboub, Associate Professor of Economics at Denison University, among others.

Commonspace
Bernie Sanders' adviser to join advisory group for new indy economics organisation

David Jamieson

Ivan Horrocks — Job guarantee programmes: back to the future?

Favorable post on Fadhel Kaboub's presentation of the MMT JG.

There is a bit of confusion in the post, however.

The presentation is worth watching in full, not least because it contains a fairly straightforward explanation of MMT, and because, in a brief aside, Kaboub takes issue with the term Modern Monetary Theory, because, as he rightly points out, it is not a theory but a description of how money creation actually occurs in countries that enjoy full financial (monetary) sovereignty (e.g. US, UK, Japan, Australia, China, etc). Thus, a far more accurate term would be something like (my suggestion) Actual Monetary Practice (AMP), or, as Kaboub notes, a term that acknowledges that what is being referred to is a system (Actual Monetary System, perhaps?).

Of course, the issue of MMT being a misnomer has been raised by Peter May before on this blog and is a serious one in the sense that use of ‘theory’ means MMT is a “loaded” term. By that I mean that most people (and I know this from many years teaching undergrads and postgrads) take theory to mean we are talking about a supposition or set of ideas that may – and that’s the key word here, may, not does or can – explain a situation, action, or phenomenon. Use of ‘theory’ therefore instantly undermines the accuracy and descriptive power of the MMT approach.…

The reality is that there are three major aspects of MMT. The first is a description of monetary systems, with emphasis on the presently operative floating rate system that replaced the fixed rate system under the gold standard. This is chiefly institutional analysis based on accounting principles and practice, and stock-flow consistent models. It is chiefly descriptive. This is set forth, for example, on Eric Tymoigne's book on money and banking.

The second aspect is a macroeconomic theory. This is set forth, for example, in Bill Mitchell and Randy Wray's textbook on macroeconomics. It is theory since it involves causal explanation.

The third aspect is economic policy based on understanding of the prior two aspects of MMT. This is normative, since policy objectives are based on values.

Progressive Pulse
Job guarantee programmes: back to the future?

Ivan Horrocks

Tcherneva, Sawicky and Kaboub on MMT and policy

Pavlina Tcherneva:

There is nothing more crippling to a bold policy agenda than the myth that the government can run out of money. This myth is behind every But how will you pay for it? objection to proposals such as a Green New Deal and Medicare for All. New House Majority Leader Nancy Pelosi (D-Calif.) has even proposed instituting self-defeating PAYGO (pay as you go) rules, which would require all new government spending to be matched with increased revenue, wrongly prioritizing the balancing of the budget over the well-being of the public.

Dispelling this myth is at the heart of an economic approach that is rapidly gaining a global following, known as modern monetary theory (MMT). MMT stresses that, in the modern world, where government-backed currencies are no longer backed by gold or other commodities, federal governments can’t run out of financial resources. Unlike states and municipalities (which have hard constraints on spending), for the federal government, all funding shortages are artificially created. Understanding this changes everything—from the economic possibilities before us to what the public can demand from our government.

In These Times

PAYGO Is Based on a Fallacy
Pavlina R. Tcherneva | program director and associate professor of economics at Bard College and research associate at the Levy Economics Institute

Max Sawicky:

Pavlina asserts that an ideology of fiscal rectitude, embodied in the How will we pay for it? mantra, places impossible barriers before progressive public spending initiatives. For a number of reasons, however, this isn’t quite right.… 

There are a bunch of ways to justify additional public spending without recourse to MMT....

In These Times
The Best Way To Argue Against PAYGO
Max B. Sawicky | independent economist and writer based in Virginia, formerly at the Economic Policy Institute in Washington, D.C.

 Fadhel Kaboub:

The rising popularity of modern monetary theory (MMT) has inevitably brought misconceptions. Critics across the political spectrum often claim that MMTers want sovereign governments to “just print money” with no concern for the national debt or, as Max B. Sawicky suggests, inflation. Some, especially on the Right, point to Venezuela and Zimbabwe as classic cases of hyperinflation.

But MMT points to a different primary cause of inflation in developing countries: not domestic spending, but foreign debt and a resulting lack of “monetary sovereignty.”...

In These Times

Why Government Spending Can’t Turn the U.S. Into Venezuela—When poor countries fall prey to inflation, it’s not because they’re “too socialist.”
Fadhel Kaboub | associate professor of economics at Denison University, and president of the Global Institute for Sustainable Prosperity

Stephanie Kelton, Randy Wray and Fadhel Kaboub links

Stephanie Kelton is a leading American economist and a professor of public policy and Economics at Stony Brook University. Kelton was chief economist on the US Senate Budget Committee and economic adviser to the Bernie Sanders 2016 presidential campaign. She's most known for being a pioneer of Modern Monetary Theory (MMT).

In this episode, Professor Kelton debunks budget deficit and government spending myths, and explains why understanding how our monetary system works is crucial to making the political and economic case for important programs like universal health care, free public higher education, infrastructure investment, and more.
We also explore some current economic issues, including how we might be able to cancel all public and private student debt in the US, and lastly the role and challenges of women in economics.

Audio only.

Truthout

Economic Adviser to the Sanders 2016 Campaign Debunks Budget Deficit Myths
Paul Sliker, Michael Palmieri and Dante Dallavalle, Left Out | Audio Segment
 See also

Economics professor L. Randall Wray, one of the plan’s principal authors, and Evercore ISI analyst Ernie Tedeschi discuss the issue with Scott Lanman of Bloomberg News and Daniel Moss of Bloomberg Opinion.

Audio only.

Bloomberg
Everybody Gets a Job!

See also

Dr Fadhel Kaboub, an Associate Professor of Economics at Denison University and President of the Binzagr Institute for Sustainable Prosperity, has given a talk at City, University of London.

The title of his presentation was "The Case for a Job Guarantee in the UK: The Economics of Care, Dignity, and Prosperity".

Audio only.

City, University of London

Fadhel Kaboub speaks at City, University of London