Stephanie, Outstanding effin' post! It's amazing how you can in fewer than 1500 words surgically skewer the conventional wisdom on money mechanics. I know how much time and effort it takes to bang out one's thoughts on a keyboard, and I, for one, appreciate it.
And yes, Peter Coy's column had a whiff of patronizing condescension: "In c…
Stephanie, Outstanding effin' post! It's amazing how you can in fewer than 1500 words surgically skewer the conventional wisdom on money mechanics. I know how much time and effort it takes to bang out one's thoughts on a keyboard, and I, for one, appreciate it.
And yes, Peter Coy's column had a whiff of patronizing condescension: "In case you're wondering, I'm familiar with MMT. I just think it's bullshit." I exchange emails with Peter from time to time. He's a smart guy with a sharp sense of humor. I called him out on that column because he's better than that.
In addition to you, Stephanie, another one of my heroes is Randy Wray. His new book, "Making Money Work For Us," is simply brilliant...and brilliantly simple. In his entertaining Chapter 6 Randy discusses the need for creating new "memes" that might help people to more easily understand the (often counter-intuitive) insights of MMT. So here's one. Suppose federal positive "net spending" is like gaining weight. About 2/3's of Americans are either overweight or obese (no body shaming intended). How is this possible? I taught English in the People's Republic of China in 1983-84, during which the Chinese economic juggernaut was in its infancy. I didn't see many overweight Chinese. In fact, the greeting, "Ni hen Pang!" (you're very fat) was meant as a compliment. The speaker was acknowledging the fact that this person appeared to be doing very well (or maybe they were just being polite). Back in those days it was hard to get "pang" on a diet of rice and pickled bai cai (white cabbage).
So many Americans are over their ideal weight because America produces an abundance of food (some might say "empty calories"). Americans may gain weight, but no one is suggesting that we pass a law forcing overweight folks to "pay back" their calories! The American agricultural industry is perfectly capable of supplying the extra calories that appear to make people happy. The gov't doesn't want those calories back in order to feed other people. If it ever tried to do so, we'd have a second American Revolution on our hands.
So here's the point. Just as too much positive "net spending" by the federal gov't can create economic problems (namely, runaway inflation), too much weight gain can create health problems. So it's advisable to monitor both "net spending" and weight gain. Now this is important: the amount of weight gain that Kareem Abdul Jabbar can accommodate is surely far greater than what, say, Danny Devito can ever hope to take on. Think of Kareem as the United States and Devito as, oh I don't know, Peru.
Dear reader, if you think this analogy has merit and--more important--if you think you can "flesh it out" more clearly (pun intended), please reply to this comment.
Stephanie, Outstanding effin' post! It's amazing how you can in fewer than 1500 words surgically skewer the conventional wisdom on money mechanics. I know how much time and effort it takes to bang out one's thoughts on a keyboard, and I, for one, appreciate it.
And yes, Peter Coy's column had a whiff of patronizing condescension: "In case you're wondering, I'm familiar with MMT. I just think it's bullshit." I exchange emails with Peter from time to time. He's a smart guy with a sharp sense of humor. I called him out on that column because he's better than that.
In addition to you, Stephanie, another one of my heroes is Randy Wray. His new book, "Making Money Work For Us," is simply brilliant...and brilliantly simple. In his entertaining Chapter 6 Randy discusses the need for creating new "memes" that might help people to more easily understand the (often counter-intuitive) insights of MMT. So here's one. Suppose federal positive "net spending" is like gaining weight. About 2/3's of Americans are either overweight or obese (no body shaming intended). How is this possible? I taught English in the People's Republic of China in 1983-84, during which the Chinese economic juggernaut was in its infancy. I didn't see many overweight Chinese. In fact, the greeting, "Ni hen Pang!" (you're very fat) was meant as a compliment. The speaker was acknowledging the fact that this person appeared to be doing very well (or maybe they were just being polite). Back in those days it was hard to get "pang" on a diet of rice and pickled bai cai (white cabbage).
So many Americans are over their ideal weight because America produces an abundance of food (some might say "empty calories"). Americans may gain weight, but no one is suggesting that we pass a law forcing overweight folks to "pay back" their calories! The American agricultural industry is perfectly capable of supplying the extra calories that appear to make people happy. The gov't doesn't want those calories back in order to feed other people. If it ever tried to do so, we'd have a second American Revolution on our hands.
So here's the point. Just as too much positive "net spending" by the federal gov't can create economic problems (namely, runaway inflation), too much weight gain can create health problems. So it's advisable to monitor both "net spending" and weight gain. Now this is important: the amount of weight gain that Kareem Abdul Jabbar can accommodate is surely far greater than what, say, Danny Devito can ever hope to take on. Think of Kareem as the United States and Devito as, oh I don't know, Peru.
Dear reader, if you think this analogy has merit and--more important--if you think you can "flesh it out" more clearly (pun intended), please reply to this comment.