I believe the Fed and others have been using MMT since the Asian Bond Crisis in 1998 and surely since the dot.com crash. Their end game has been protecting the wealth & income of the Ruling Elite. And it's worked for them. That's OUR problem
Only a few thousand people and corporations immensely benefited while they created hamburger flippers and mini-mart clerks.
I completely agree. The wealthy understand the implications of MMT only too well.
I'm not so sure about the politicians, because I saw a video of a woman Senator who said, "Well, where does the money come from? Pixie dust?" (I wanted to say to her, "Yes, ma'am. If you want to call the appropriations bill you just passed 'pixie dust'.")
It's sad that ordinary people just refuse to learn it. It's not that hard.
They'd be much better off if they only knew it! I'm now trying to persuade them by pointing out that they can see through the lies the politicians use if they know MMT. Always appeal to someone's self-interest! If they see what's in it for them, it might help.
For the last 2 years I've been involved in city politics and the elected politicians only know or care about what their campaign donors desire AND sadly, most are ignorant, lazy and/or stupid.
On the national, and somewhat on the state level, there is some oversight by some groups.
On the local level Corruption is off the charts because there are no serious watchdogs.
That's so weird and so discouraging, because when I read Alexis de Toqueville, I was amused by his belief that the central government should send out spies to make sure that the local governments were doing their jobs, in the manner of the French government. I thought that he didn't understand the principle of "government by the people," because the local government is the closest to the people's eye, and should be the easiest for the people to hold accountable.
I guess your observation just proves the point that "people get the government they deserve." The serious watchdogs should be the people who voted them into office.
Nice Alexis quote. Decades ago when I flipped through the book, if I would have seen this quote, I would have thought he was crazy.
Reformers are too busy working on all the injustices to spend much time coordinating their efforts. Too bad we all can't rally around the primary source of most problems... economics/capitalism.
I believe many of these important, but subordinate issues are funded by Big Money Interests to keep us distracted & splintered.
All of the injustices that the reformers are working on are valuable in their own right, but it ends up being incessant brush-fire fighting, as you say, rather than addressing the main issue of capitalism.. They are doing "tunneling," as described in the book Scarcity. Please read that book; it has several valuable points to make.
Naturally Big Money wants to divide us; "divide and conquer" is as old as the hills.
Sorry, I didn't read this one yet, but I have no other way of communicating a problem I'm having with your server. I'm subscribed and am trying to change my email address for receiving these and the system is not giving me an way of doing it because it just asks me to subscribe even though I already have. Please send help. Thank you. Alex Schmidt SUNY Stony Brook '81.
I would like to see a discussion of the "degrowth" concept and how it could be managed. I believe some version of degrowth is required, and the United States is the country most in need of making a transition, but degrowth seems to only be a "radical left" slogan at this point.
I don't believe that we can grow our way out of the climate crisis and environmental degradation, but what will a successful degrowth economy look like, and how can it be promoted?
The de-industrialization of the USA economy is doing a pretty good job of de-growth. Perhaps China will have better luck with global warming, after the sufficient de-growth in the USA reduces our empire to a shadow of what it once was.
Not being an empire will be good for our de facto colonies. Too bad we couldn't have done that on our own terms instead of being crushed as a result of US Big Money Interests.
We definitely need de-consumerism. Look at all the cheap stuff being made and sold that's wasting both our natural & human resources. They're projecting a tripling of energy use by 2050 which means a lot more utilization of our natural resources and commodities, some of which are being constrained by current demand.
I wish MMT's critics would take a course teaching "The Deficit Myth" and be required to pass a test on it afterwards. (Without the test, they would there physically, but mentally somewhere else developing reasons why MMT won't work.)
Like all theories to become popular, a paradigm shift will have to occur among the economists and experts who were brought up on and perhaps even teach monetarism or Keynesianism. They just are too inflexible mentally to see up and over the box they are in; it does take a degree of objectivity and willingness to learn new things. One of my professors said that the human mind is infinitely resistant to new learning. It's often discomfiting to see the world differently. What if FDR knew in advance of the Japanese attack on Dec. 7, 1941? What if the first seven presidents were Deists, not Christians? What if Mormonism is true? What if Elvis was only a front-man for the real artist singing behind the curtain? What if Ellen DeGeneres is not really gay? What if my lifelong political party has gone berserk?
If you were certain that the world is flat, but you then fly around the world, your faith in your belief system will be torn asunder. Cognitive dissonance is painful, so monetarists and others avoid MMT like the source of pain that it would be for them. Who likes to admit personal and judgmental error, especially a lifelong history of it?
Yes, as Max Planck said (I believe) "Science advances one funeral at a time." Ironically the human mind is both the hardest and easiest thing to change in the entire cosmos. It just takes modicums of knowledge, self honesty and the will to actually look at different points of view.
If MMTers really wanted to be influencial they would bother a whole lot less trying to convince "the authorities" and put a whole lot more effort in building a mass movement that communicated the benefits to all economic agents of a new monetary paradigm as I have posted here many times. A new paradigm which conceptually and theoretically perfectly aligns with MMT and which temporally enables virtually all of their goals.
But we ARE trying to start a movement. Steve Grumbine has been tearing his hair out about it. Ordinary people are even more resistant to changing their thought processes about money than the influential. They will only listen to those sources of "knowledge."
Which one of the two following movements could you more easily and logically get behind: 1) an abstract notion that fiscal deficits could possibly make some more money available to you via once removed from you direct gifting to government contractors, 2) (a) everything in #1 plus (b) a direct gift to you of 50% of the price of virtually EVERYTHING, EVERY TIME you purchased something, (b) huge income tax relief, and if you're working the elimination of almost all the payroll taxes you pay, (c) the terminal ending of the pain of inflation, (d) the hope that we could FINALLY begin to fund the kind of mega-projects necessary for you and your progeny to survive climate change...by avoiding it (e) and finally what could be the potential social-psychological and natural spiritual benefits of having the opportunity to feel gratitude for a gift everytime you bought something???
Sadly, it will take a global catastrophe like our planet's crashing climate to get their attention, but that will take several decades. While this happens the Big Money Interests will be saying we need to finance their solutions requiring vast sums, like they've always done.
The Wealthy will never willingly surrender their power, authority and control.
Perhaps a Global Depression, the likes of which we've never seen, will do the trick.
If the high priests of macroeconomics Larry Summers, Olivier Blanchard and co had discovered first the insights from the body of work called MMT, you can bet your bottom dollar, that the financial commentariat would be like canaries in a mineshaft singing its praises. They would all be chirping we’re all MMT followers now.
Health Insurance Industry 16-18%, not including capital gains, dividends, interest income, exorbitant salaries, stock options, bonuses, corporate jets, cars, depreciation, other write-offs, lavish 'expense' accounts, etc.
She misses the opportunity to say that MMT worries about inflation from too much money "printing" more than most orthodox economists do.
She also fails to own up to the fact that MMT focuses its theory on transfers of money from the Federal Government sector that creates USA money to all the sectors that are not Federal government sectors that are users of USA money, but not creators. The balance of this transfer is very important, but equally important these days is who in these other sectors get the money. MMT does not purport to address this missing piece, but also fails to identify how important this missing piece is.
You're observations re: MMT are actually accurate, but MMT is a lot closer to the truth than the present orthodoxy of neo-classical macro because it conceptually aligns with the new monetary paradigm (monetary gifting). Oddly Libertarianism, which appears to be what you espouse, also, rhymes with the new paradigm in that they want to see deflation occur...which is an attempt to invert the present reality of chronic erosive inflation . It's just that they haven't cognited on how we can create beneficial price and asset deflation and so they must insist on an incredibly painful orthodoxy of the need for deflation. (Libertarianism also rhymes with paradigm changes in that one of their primary signatures is complete conceptual opposition to the present paradigm.)
This situation mirrors the Copernican cosmological paradigm change in that helio-centrism initially was actually less accurate in predicting planetary motion than the Ptolemaic model even though helio-centrism turned out to be true. It took Kepler's discovery of the ellipse to make helio-centrism the more accurate model. I hasten to mention that the universally beneficial macro-economic deflationary effect of a 50% Discount/Rebate policy at retail sale is remarkably analogous to Kepler's discovery of the ellipse and his laws of planetary motion confirming the new Copernican paradigm.
I do not espouse libertarianism. I do not know how you could have the impression that I did. I did not question the accuracy of MMT for what it covers. I pointed out an important part of money that MMT never said it covered.
It's not inaccurate for MMT economists to say that the government spends money into existence while not explicitly naming the recipients of the spending. Technically, it doesn't matter who receives the money, just that the government creates it and spends it into the economy.
Socially, however, it makes a great deal of difference, and I think that MMT economists do concern themselves with HOW the money is spent. Also, when someone understands the nuts and bolts of MMT, I expect them to use their heads and figure it out. Most people everywhere can now see where the money is going.
I never disagreed with MMT saying that the Federal government is the creator of USA money. I also agreed that everyone else is a money user.
What do you mean that "technically it does not matter who receives the money"? For a theory that does not address who receives the money, or course it does not matter what you ignore. If you want to forecast inflation, or the amount of money that needs to be created, it matters a lot who receives the money. For the last decade or so the Federal Reserve Bank has created plenty of money. However, the money was not going to the people it needed to go to that would have made the Fed successful in achieving its goals. The Fed created trillions of dollars, but could not get inflation up to its target of 2%. Now that conditions have changed, the Fed will fail to bring inflation down, unless it comes up with a way to get the excess money out of the hands of the people who are not using that money in a economically productive way. The Fed is not equipped for the task that needs to be done. The Fed has no control over the military budget that needs to be reined in, for example.
In your first sentence, you say that you agree that Congress creates the currency. In your sixth sentence, you are back to claiming that the Fed creates the currency.
I have only been learning MMT for the last 10 years. I have read a lot. I did not say anything that contradicts what you said. What do you think I said that contradicts MMT? I know that many MMT affcionados have trouble with the nuance that I was talking about. If you tell me what words that I said that seem to be a contradiction of MMT, please let me know so I can reword my comment in the future.
I have to say the “willful ignorance” of these commentators and scholars comes back to their own earnings, fear and hatred of undeserving people who desire prosperity for their families. This psychology remains abhorrent and useless. Please get yourself on these programs and destroy their nonsensical comments Stephanie Kelton...you’re the prefect representative for all things MMT.
Thanks for the info. I finally watched the Grumbine episode you mentioned above and found it useful. I will continue to do my part as an MMT apologist.
I'd love to hear your justification for the comment that Quantitative Easing is not the direct creation of the currency. What MMT expert ever said that? I am not going to search for the link, but I recall some testimony by Bernanke to Paul Ryan. Ryan asked Bernanke whose money he was using for QE. Bernanke replied, we created it.
Well, now I know you are wrong. Sometimes people who think they understand MMT, don't really understand it all. Even when told about their mistakes, they will not disavow them. What motivates people like that?
I was wondering the same thing about you: "Worse than simple lack of knowledge...is the potent ignorance of false certainty - the cocksure belief of someone who is sure that he knows what he does not know." Lies We Live By: the art of self-deception by Eduardo Gianetti (Bloomsbury, 2000) p. x
Amen, Sisters & Brothers.
They're always killing MMT off and celebrating the funeral.
MMT must scare their pants off.
I believe the Fed and others have been using MMT since the Asian Bond Crisis in 1998 and surely since the dot.com crash. Their end game has been protecting the wealth & income of the Ruling Elite. And it's worked for them. That's OUR problem
Only a few thousand people and corporations immensely benefited while they created hamburger flippers and mini-mart clerks.
Then they brag about job creation.
I completely agree. The wealthy understand the implications of MMT only too well.
I'm not so sure about the politicians, because I saw a video of a woman Senator who said, "Well, where does the money come from? Pixie dust?" (I wanted to say to her, "Yes, ma'am. If you want to call the appropriations bill you just passed 'pixie dust'.")
It's sad that ordinary people just refuse to learn it. It's not that hard.
They'd be much better off if they only knew it! I'm now trying to persuade them by pointing out that they can see through the lies the politicians use if they know MMT. Always appeal to someone's self-interest! If they see what's in it for them, it might help.
For the last 2 years I've been involved in city politics and the elected politicians only know or care about what their campaign donors desire AND sadly, most are ignorant, lazy and/or stupid.
On the national, and somewhat on the state level, there is some oversight by some groups.
On the local level Corruption is off the charts because there are no serious watchdogs.
That's so weird and so discouraging, because when I read Alexis de Toqueville, I was amused by his belief that the central government should send out spies to make sure that the local governments were doing their jobs, in the manner of the French government. I thought that he didn't understand the principle of "government by the people," because the local government is the closest to the people's eye, and should be the easiest for the people to hold accountable.
I guess your observation just proves the point that "people get the government they deserve." The serious watchdogs should be the people who voted them into office.
Nice Alexis quote. Decades ago when I flipped through the book, if I would have seen this quote, I would have thought he was crazy.
Reformers are too busy working on all the injustices to spend much time coordinating their efforts. Too bad we all can't rally around the primary source of most problems... economics/capitalism.
I believe many of these important, but subordinate issues are funded by Big Money Interests to keep us distracted & splintered.
What can I say except that I completely agree?
All of the injustices that the reformers are working on are valuable in their own right, but it ends up being incessant brush-fire fighting, as you say, rather than addressing the main issue of capitalism.. They are doing "tunneling," as described in the book Scarcity. Please read that book; it has several valuable points to make.
Naturally Big Money wants to divide us; "divide and conquer" is as old as the hills.
Sorry, I didn't read this one yet, but I have no other way of communicating a problem I'm having with your server. I'm subscribed and am trying to change my email address for receiving these and the system is not giving me an way of doing it because it just asks me to subscribe even though I already have. Please send help. Thank you. Alex Schmidt SUNY Stony Brook '81.
I googled "contact Stephanie Kelton" and sent her an email. Maybe you could try that.
I would like to see a discussion of the "degrowth" concept and how it could be managed. I believe some version of degrowth is required, and the United States is the country most in need of making a transition, but degrowth seems to only be a "radical left" slogan at this point.
I don't believe that we can grow our way out of the climate crisis and environmental degradation, but what will a successful degrowth economy look like, and how can it be promoted?
The de-industrialization of the USA economy is doing a pretty good job of de-growth. Perhaps China will have better luck with global warming, after the sufficient de-growth in the USA reduces our empire to a shadow of what it once was.
Not being an empire will be good for our de facto colonies. Too bad we couldn't have done that on our own terms instead of being crushed as a result of US Big Money Interests.
We definitely need de-consumerism. Look at all the cheap stuff being made and sold that's wasting both our natural & human resources. They're projecting a tripling of energy use by 2050 which means a lot more utilization of our natural resources and commodities, some of which are being constrained by current demand.
I wish MMT's critics would take a course teaching "The Deficit Myth" and be required to pass a test on it afterwards. (Without the test, they would there physically, but mentally somewhere else developing reasons why MMT won't work.)
Like all theories to become popular, a paradigm shift will have to occur among the economists and experts who were brought up on and perhaps even teach monetarism or Keynesianism. They just are too inflexible mentally to see up and over the box they are in; it does take a degree of objectivity and willingness to learn new things. One of my professors said that the human mind is infinitely resistant to new learning. It's often discomfiting to see the world differently. What if FDR knew in advance of the Japanese attack on Dec. 7, 1941? What if the first seven presidents were Deists, not Christians? What if Mormonism is true? What if Elvis was only a front-man for the real artist singing behind the curtain? What if Ellen DeGeneres is not really gay? What if my lifelong political party has gone berserk?
If you were certain that the world is flat, but you then fly around the world, your faith in your belief system will be torn asunder. Cognitive dissonance is painful, so monetarists and others avoid MMT like the source of pain that it would be for them. Who likes to admit personal and judgmental error, especially a lifelong history of it?
Yes, as Max Planck said (I believe) "Science advances one funeral at a time." Ironically the human mind is both the hardest and easiest thing to change in the entire cosmos. It just takes modicums of knowledge, self honesty and the will to actually look at different points of view.
If MMTers really wanted to be influencial they would bother a whole lot less trying to convince "the authorities" and put a whole lot more effort in building a mass movement that communicated the benefits to all economic agents of a new monetary paradigm as I have posted here many times. A new paradigm which conceptually and theoretically perfectly aligns with MMT and which temporally enables virtually all of their goals.
But we ARE trying to start a movement. Steve Grumbine has been tearing his hair out about it. Ordinary people are even more resistant to changing their thought processes about money than the influential. They will only listen to those sources of "knowledge."
Which one of the two following movements could you more easily and logically get behind: 1) an abstract notion that fiscal deficits could possibly make some more money available to you via once removed from you direct gifting to government contractors, 2) (a) everything in #1 plus (b) a direct gift to you of 50% of the price of virtually EVERYTHING, EVERY TIME you purchased something, (b) huge income tax relief, and if you're working the elimination of almost all the payroll taxes you pay, (c) the terminal ending of the pain of inflation, (d) the hope that we could FINALLY begin to fund the kind of mega-projects necessary for you and your progeny to survive climate change...by avoiding it (e) and finally what could be the potential social-psychological and natural spiritual benefits of having the opportunity to feel gratitude for a gift everytime you bought something???
Sadly, it will take a global catastrophe like our planet's crashing climate to get their attention, but that will take several decades. While this happens the Big Money Interests will be saying we need to finance their solutions requiring vast sums, like they've always done.
The Wealthy will never willingly surrender their power, authority and control.
Perhaps a Global Depression, the likes of which we've never seen, will do the trick.
If the high priests of macroeconomics Larry Summers, Olivier Blanchard and co had discovered first the insights from the body of work called MMT, you can bet your bottom dollar, that the financial commentariat would be like canaries in a mineshaft singing its praises. They would all be chirping we’re all MMT followers now.
Denial of productive role for government.
The same old saw with a complicit corporate mass media.
Why can't we just call it what its been and is?
...neo feudalism, inverted totalitarianism, rentier political power and dominance, corporate coup d'etat, financialization or simply, class warfare?
Medicare total cost for admin 2%
Health Insurance Industry 16-18%, not including capital gains, dividends, interest income, exorbitant salaries, stock options, bonuses, corporate jets, cars, depreciation, other write-offs, lavish 'expense' accounts, etc.
You have to have a sense of humor.
or a good shrink.
She misses the opportunity to say that MMT worries about inflation from too much money "printing" more than most orthodox economists do.
She also fails to own up to the fact that MMT focuses its theory on transfers of money from the Federal Government sector that creates USA money to all the sectors that are not Federal government sectors that are users of USA money, but not creators. The balance of this transfer is very important, but equally important these days is who in these other sectors get the money. MMT does not purport to address this missing piece, but also fails to identify how important this missing piece is.
You're observations re: MMT are actually accurate, but MMT is a lot closer to the truth than the present orthodoxy of neo-classical macro because it conceptually aligns with the new monetary paradigm (monetary gifting). Oddly Libertarianism, which appears to be what you espouse, also, rhymes with the new paradigm in that they want to see deflation occur...which is an attempt to invert the present reality of chronic erosive inflation . It's just that they haven't cognited on how we can create beneficial price and asset deflation and so they must insist on an incredibly painful orthodoxy of the need for deflation. (Libertarianism also rhymes with paradigm changes in that one of their primary signatures is complete conceptual opposition to the present paradigm.)
This situation mirrors the Copernican cosmological paradigm change in that helio-centrism initially was actually less accurate in predicting planetary motion than the Ptolemaic model even though helio-centrism turned out to be true. It took Kepler's discovery of the ellipse to make helio-centrism the more accurate model. I hasten to mention that the universally beneficial macro-economic deflationary effect of a 50% Discount/Rebate policy at retail sale is remarkably analogous to Kepler's discovery of the ellipse and his laws of planetary motion confirming the new Copernican paradigm.
I do not espouse libertarianism. I do not know how you could have the impression that I did. I did not question the accuracy of MMT for what it covers. I pointed out an important part of money that MMT never said it covered.
My bad. The rest of my post I stand by.
It's not inaccurate for MMT economists to say that the government spends money into existence while not explicitly naming the recipients of the spending. Technically, it doesn't matter who receives the money, just that the government creates it and spends it into the economy.
Socially, however, it makes a great deal of difference, and I think that MMT economists do concern themselves with HOW the money is spent. Also, when someone understands the nuts and bolts of MMT, I expect them to use their heads and figure it out. Most people everywhere can now see where the money is going.
I never disagreed with MMT saying that the Federal government is the creator of USA money. I also agreed that everyone else is a money user.
What do you mean that "technically it does not matter who receives the money"? For a theory that does not address who receives the money, or course it does not matter what you ignore. If you want to forecast inflation, or the amount of money that needs to be created, it matters a lot who receives the money. For the last decade or so the Federal Reserve Bank has created plenty of money. However, the money was not going to the people it needed to go to that would have made the Fed successful in achieving its goals. The Fed created trillions of dollars, but could not get inflation up to its target of 2%. Now that conditions have changed, the Fed will fail to bring inflation down, unless it comes up with a way to get the excess money out of the hands of the people who are not using that money in a economically productive way. The Fed is not equipped for the task that needs to be done. The Fed has no control over the military budget that needs to be reined in, for example.
In your first sentence, you say that you agree that Congress creates the currency. In your sixth sentence, you are back to claiming that the Fed creates the currency.
Which is it?
Congress delegates the creation of money to the Federal Reserve Bank
I guess you haven't read much about MMT inflation concerns that have been well-articulated.
Basically, you don't want to exceed the productive capacity of the economy ie it's natural & human resources and commodities.
I have only been learning MMT for the last 10 years. I have read a lot. I did not say anything that contradicts what you said. What do you think I said that contradicts MMT? I know that many MMT affcionados have trouble with the nuance that I was talking about. If you tell me what words that I said that seem to be a contradiction of MMT, please let me know so I can reword my comment in the future.
My mistake, I misread your first sentence.
I have to say the “willful ignorance” of these commentators and scholars comes back to their own earnings, fear and hatred of undeserving people who desire prosperity for their families. This psychology remains abhorrent and useless. Please get yourself on these programs and destroy their nonsensical comments Stephanie Kelton...you’re the prefect representative for all things MMT.
Steve Grumbine did a video on Status Coup yesterday "Let's Get Ready to Grumble" about the conservative narrative of "moochers." Look it up.
Thanks for the info. I finally watched the Grumbine episode you mentioned above and found it useful. I will continue to do my part as an MMT apologist.
Well, you're very welcome.
But please don't think that you have to apologize for MMT; rather, be its defender.
"Each one teach one," as we say.
Apologist as defined by advocating and championing MMT. I only apologize to my spouse, mostly, and quite often I might add.
Then you should express yourself more clearly and call yourself "an advocate."
"Apologist" has some unpleasant connotations.
My congratulations on your apologizing to your spouse. More people should do this.
The Fed is an independent USA government entity created by Congress. I see no inconsistency. where do you see an inconsistency?
I'd love to hear your justification for the comment that Quantitative Easing is not the direct creation of the currency. What MMT expert ever said that? I am not going to search for the link, but I recall some testimony by Bernanke to Paul Ryan. Ryan asked Bernanke whose money he was using for QE. Bernanke replied, we created it.
I didn't say that an MMT expert said that. *I* said that.
Well, now I know you are wrong. Sometimes people who think they understand MMT, don't really understand it all. Even when told about their mistakes, they will not disavow them. What motivates people like that?
I was wondering the same thing about you: "Worse than simple lack of knowledge...is the potent ignorance of false certainty - the cocksure belief of someone who is sure that he knows what he does not know." Lies We Live By: the art of self-deception by Eduardo Gianetti (Bloomsbury, 2000) p. x
How do you interpret this story in Forbes?
https://www.forbes.com/sites/afontevecchia/2013/07/17/bernanke-to-congress-we-are-printing-money-just-not-literally/?sh=4566868f109b