MMT: overcoming the political divide.

Discussion in 'Economics & Trade' started by a better world, Mar 12, 2020.

  1. bringiton

    bringiton Well-Known Member

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    Right. Socialists all over the world hailed the Bolshevik revolution as the triumph of socialism -- until it became irrefutably clear that Soviet socialism had created the world's largest concentration camp. Then suddenly it became the oxymoronic "state capitalism."
     
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  2. a better world

    a better world Well-Known Member

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    FAR OUT!!!

    Just shows the danger of argument based on labels, rather than policies
     
    Last edited: Apr 1, 2020
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  3. a better world

    a better world Well-Known Member

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    Oxymoronic?

    Isn't China's system "state capitalism"?
     
  4. Reiver

    Reiver Well-Known Member

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    We merely have you falling for the myths about Keynes. At each ignorant post you have denied or downplayed his radical socialism. Perhaps you need a quote from Trotsky, who he met during a lecture series in Russia: "Even the most progressive economist Keynes told us only the other day that the salvation of the British economy lies in Malthusianism! And for England, too, the road of overcoming the contradiction between city and country leads through Socialism".
     
  5. a better world

    a better world Well-Known Member

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    Speaking of policy, here is the MMT prescription for sovereign governments
    dealing with the present calamitous pandemic:

    1. The sovereign (insert nation) government can pay for food and accommodation for unemployed workers, without borrowing the money, because sovereign currency issuing governments can issue their own currency (as explained by MMT).

    2. This government spending to support unemployed workers will not cause inflation, because the spending will not create any excess demand on the nation's present (sufficient) supply of available food and accommodation.

    3. Which is to say: an increase in the money supply will not mean a decrease in its value, provided
    the money is spent on available resources, as outlined above.

    4. Money is mostly numbers in computers, and these numbers can be entered into the bank accounts of unemployed workers, via combined treasury and central bank operations.

    ...….so let's have no more talk of the massive 'post pandemic debt overhang' nonsense that mainstream neoliberal monetarists keep banging on about. It isn't necessary, and only serves as a means of indoctrinating us into accepting endless future government 'austerity'.
     
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  6. bringiton

    bringiton Well-Known Member

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    <yawn> Why do you always have to be wrong? Fabianism was explicitly not radical.
    "Contradiction" between city and country?? What a buffoon.
     
  7. bringiton

    bringiton Well-Known Member

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    No. Like Hong Kong's before it, China's system is essentially geoist: private ownership of producer goods, public ownership of land and natural resources. Although China is burdened with dictatorship, corruption, and other legacy problems from its ~30-year socialist phase, the geoist system it adopted under Deng Xiaoping is in principle superior to capitalism, which is superior to socialism. That is why China has boomed so spectacularly despite the corruption and incompetent meddling of the Communist Party.
     
  8. Reiver

    Reiver Well-Known Member

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    You can of course refer to Fabianism, particularly today, as a means to avoid revolution. I've demonstrated, mind you, that it wouldn't be a fair representation of Keynes. As illustrated by his quotes (and quotes from revolutionary), he was indeed a radical. Perhaps you think Keynes' was wrong about himself? ;)

    Let's be honest here. Trotsky at least could think for himself. He wasn't endlessly repeating the same Georgist script like some folk...
     
  9. bringiton

    bringiton Well-Known Member

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    No, that's nonsense. No honest, informed person would deny he was a Fabian.
    You are wrong -- and disingenuous -- about Keynes.
    Don't make me laugh.
    He was apparently a decent chess player and pretty successful military commander.
    Repeating a "Georgist" script?? That would be you.
     
  10. kazenatsu

    kazenatsu Well-Known Member Past Donor

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    Because they don't want to debase their currency.

    Sure, you can just print the money you need, but then people will start demanding more of it in exchange for things.

    With your type of logic, one could ask why the government should ever collect taxes.
     
    Last edited: Apr 2, 2020
  11. kazenatsu

    kazenatsu Well-Known Member Past Donor

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    Okay, point conceded.

    However, you do realize that this just feeds into the far conservative stereotype that Keynesianism is "Communist/Socialist" ?
     
    Last edited: Apr 2, 2020
  12. Reiver

    Reiver Well-Known Member

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    I'll use Keynes' words himself: "The only course open to me is to be buoyantly bolshevik". On Lenin he said "political control of affairs was of a high intellectual competence. The histories of revolution contain nothing more remarkable or more coldly and splendidly glittering than the career of Nicholas Lenin"

    This amused me at least. You're going for the standard myth. I'm quoting him directly. That Georgist script doesn't push to facts does it now?
     
  13. Reiver

    Reiver Well-Known Member

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    Not really as neo-Keynesianism has naff all to do with Keynes!
     
  14. bringiton

    bringiton Well-Known Member

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    Yes, well, he wasn't the only Fabian to delude himself about German-funded Lenin and his Soviet holocaust.
    But misleadingly.
    I see you are still pushing your "Georgist" script. Why on earth?
     
  15. kazenatsu

    kazenatsu Well-Known Member Past Donor

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    Yes, I realize that. Because Keynes actually wanted to save money.

    The neo-'s just want to spend, spend, spend.
     
    Last edited: Apr 2, 2020
  16. a better world

    a better world Well-Known Member

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    You obviously haven't read the OP., so I'll take it slowly:

    As already pointed out:

    Trump wants to spend $3 trillion over the next several months, to enable unemployed workers to pay for their food and accommodation.
    He (the government) can do this without borrowing, and without causing inflation, because the resulting spending by unemployed workers will not result in excess demand on the supply of available food and accommodation which remains unchanged (and sufficient) from the quantum which existed before the crisis, a month ago.


    Now I use this example to illustrate the capacity of the sovereign currency issuer, AND ALSO that "printing the money" DOES NOT NECESSARILY mean a "debasement of the currency" (as already explained in post #180, and copied below):

    2. This government spending to support unemployed workers will NOT cause inflation, because the spending will not create any excess demand on the nation's present (sufficient) supply of available food and accommodation.

    3. Which is to say: an increase in the money supply will not mean a decrease in its value, provided
    the money is spent on available resources, as outlined above.


    Hence no "debasement of the currency". (Note: you are merely following the obsolete 'quantity theory of money', which Keynes himself debunked).

    Now the same principle applies at all times, ie if any increase in government spending consequent to treasury "printing money" IS LIMITED to the availability of resources on which the money can be spent, then there is no debasement of the currency - because unlike say, a situation where increased market supply of tomatoes in a 'good' year means less income for farmers (because the price of the tomatoes falls): an increase in the money supply DOES NOT necessarily mean a fall in the price/value of money so long as the resources on which to spend the money do in fact exist.

    An important point; this is the reason why politicians don't want MMT to be understood by the population - their cushy adversarial 'fun and games' jobs would be seen as largely irrelevant to the business of good governance, which encompasses more than doing 'what (individual) people demand'.
    BTW, private citizens are NOT the government which is a separate entity though it is composed of elected private citizens. This explains the often heard nonsense about government money being taxpayer money. It is not. Private citizens have to earn, beg, steal or borrow money. The currency issuing government does NOT need to 'earn' or borrow money..... which segues nicely into your next point:

    As already explained above, the government does not need to tax (or borrow) IN ORDER TO SPEND, (unlike private citizens who must earn it, etc).

    So in fact taxation becomes a tool of government to remove money from the private sector, to constrain any excess demand on available resources (should this arise in a particular sector of the economy), rather than a means of funding government ie taking money from the private sector so that the governement can spend money on social programs.

    The latter mainstream neoliberal approach merely perpetuates the misery of entrenched continuous underemployment around 10%; even in the 'best' of times, eg, the US economy - immediately before the pandemic hit - when the unemployment rate was said to be 3.5%, "the best in half a century"; in truth involuntary U6 + the people who had given up looking for work, was greater than 10%. Most other countries were worse, and even in the US there were plenty of warnings of a recession on the horizon before anyone had heard of covid-19.

    That's why MMT can offer an above poverty job to any one who wants it, something mainstream neoliberal orthodoxy can never achieve, because orthodoxy regards money as a commodity rather than a points (measuring) system.

    4. Money is mostly numbers in computers, and these numbers can be entered into the bank accounts of unemployed workers, via combined treasury and central bank operations.
     
    Last edited: Apr 2, 2020
  17. kazenatsu

    kazenatsu Well-Known Member Past Donor

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    But the supply has been reduced.
    And now you say you want demand to be kept the same.

    Food and accommodation are not the only things in the equation.
     
    Last edited: Apr 2, 2020
  18. a better world

    a better world Well-Known Member

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    Supply of workers AND demand for goods and services have both been massively reduced, as a result of the economy being shut down EXCEPT for essentials.

    Note:The government actually only needs to pay for food and accommodation - and internet - for unemployed workers, as well as maintaining most businesses in hibernation, by paying leases etc.

    Including other essentials, yes they are, for the time being.

    …..

    More on exposing the error of your mainstream 'debasement of money' theory (in normal times):

    When the supply of tomatoes into a given market increases, the price/value of the tomatoes falls. (ie suppliers must accept the price offered by buyers/demand, in order for the market to be cleared).

    However - economy wide - since producers facing competition from other producers will increase their production (if they can) and hence their profits, by increasing output rather than by raising prices, an increase in the supply of money (by government fiat) will not cause inflation if the nation's productive capacity can be increased/more fully utilised.
     
    Last edited: Apr 3, 2020
  19. Reiver

    Reiver Well-Known Member

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    This continues to amuses. I'm quoting Keynes directly, including an admission that he was a bolshevik. You, in contrast, are peddling a myth (one of course required to see Keynesian analysis as orthodox application of IS/LM and the Phillips Curve). However, you still cant see your error. Sorry, but this is what monist application of Georgism delivers. In the exact same way as the Chicago School, there is a rampant deficiency in understanding the plurality associated with macroeconomics.
     
    Last edited: Apr 3, 2020
  20. Reiver

    Reiver Well-Known Member

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    This really is a pile, merely demonstrating that you haven't understood any element of Keynesian. Neo-Keynesianism sought consistency with the neoclassical perspective. Government policy came down simply to choosing a desired combination of inflation and unemployment. That desired combination was dependent on political objective. We have already seen that such objectives are fluid. Military Keynesianism, for example, is straight out of the right wing play book.

    Compare that to the post-Keynesians. Here we see heterodox analysis that ultimately derives common ground with Marxism. Keynes is appreciated as a radical that directly challenges the neoclassical dominance. We see that, for example, in how market concentration impacts on pricing policy (keading to constant threats such as stagflation). We also see it in how there is no market mechanism that delivers efficient and equitable wages.
     
  21. bringiton

    bringiton Well-Known Member

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    I see you are still incontinently ejaculating your "Georgist" script into everything you can. Why on earth?
     
  22. bringiton

    bringiton Well-Known Member

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    "Equitable." So what we really see here is a temper tantrum caused by your impotent rage and frustration that reality does not match your opinion.
     
  23. Reiver

    Reiver Well-Known Member

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    You're even less coherent than usual. This is what post-Keynesianism derives. They of course dismiss the standard neoclassical approach and utilise an approach which combines institutionalist and behavioural perspectives. That generates an understanding of the importance of bargaining power which is quite similar to the classical economists.

    You're again showing how little you know about Economics. Has that driven your support for the Keynes' myth and your failure to understand his radical nature?
     
  24. a better world

    a better world Well-Known Member

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    I know your opinion of 'equitable' is not in accord with UNUDHR article 25: "everyone has a right to access above poverty employment".

    You claim that "reality" makes this impossible, whereas the real problem is YOUR world view, which is at fault, NOT reality.

    You place 'price' above 'value', and therefore accept some people will fall by the wayside in "invisible hand" markets, even when given access to the plot of land to which they have a right (according to Georgism).

    But while people have different aptitudes and abilities, everyone has something to contribute to the nation's wellbeing, and deserves above poverty participation as a right. Monetarism of course ignores this.

    Your world view fails right there.
     
    Last edited: Apr 3, 2020
  25. kazenatsu

    kazenatsu Well-Known Member Past Donor

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    Ok, then could you explain some simple math to us?
    Just three or four sentences.
     

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