ks.234
Half way to Infinity
As I say I think MMT has aspects of interest, but I’d need to see how it relates to private business, investment, inflation etc as things shouldn’t just be viewed through a public sector lens. Basically where I am is I know the Tory model is wrong, and clearly so, but I’m not entirely convinced this is right.
yes, do agree, though understanding how MMT a relates to private business, investment and inflation is further along the road of discovery.
MMT does address these more complex issues but first and foremost we need to realise the simple truth that government spending does not come from income raised from tax, the opposite is true.
We have a model of the economy that needs turning on it’s head in much the same way as our understanding of the solar system was turned on it’s head half a millennium ago. As turning a model of the universe with the earth at its centre on it’s head had far reaching and complex consequences, so turning an economic model with tax at the centre of spending has far reaching and complex consequence. But just as a failure to have an Einstein like understanding of the workings of the universe does not shake our understanding that the earth is not the centre of the universe, so our failure to understand the quantum workings of the economy does not threaten our understanding of the basis of where our money comes from in the real world.
First and foremost MMT means that our government can spend our GNP’s up to the limits of available resources. It means we can afford to spend whatever is required to tackle climate change. We can afford to have properly funded public services. We can afford full employment. And we can afford all those things without inflation