Yes, MMT has answers to all of those questions, they’ve been covered many, many times before. As you’ve been so critical of supporters of MMT, I’m surprised you have taken the time to look at the contents of their posts.So MMT has no answers about recession, interest rates, or unemployment? Interesting.
….a question posted by someone who has demonstrated on two threads that they are incapable of formulating either an opinion against MMT, or an opinion for Monetarism. More relevant, it was an entirely flippant question that has no relationship to your 3 questions. If you want a serious answers to three different questions, perhaps don’t frame them in one flippant and meaningless question.How do you get 12 different answers to the same economic question?
Ask 11 eleven economists.
So MMT has no answers about recession, interest rates, or unemployment? Interesting.
Yes, but there is nothing magic about MMT, it is nothing more than an observation of money flow and a policy change to a Job Guarantee. It simply says that government spending does not come from taxation or borrowing as monetarism declares. If government wants to spend money, it can. To say there is no money is a lie.In my limited world view I see a place for aspects of the policy to be applied. I sort of get the logic and think she made lots of valid points but I don't think running with pure MMT will magically cure recessions, interest rates, unemployment, corruption, bribery etc etc.
The main consideration here is the observation of money creation, any system based on constraining government spending to taxation will be flawed. Other economic models are available, but at the heart is where money comes from and to say it comes from taxation is just not reality.But the logic of it certainly would appear to have valid worthy aspects. No reason why there can't be a mixture of a variety different types of economic policies as far as I can understand.
MMT will not cost the rich very much, but it does very much go against the monetarist ideology the government spending on things like the NHS is a bad idea. Business might like the monetarist imperative to keep wages low and have a buffer stock of low cost labour, but increased spending on, say, infrastructure to tackle climate change, could create a great many opportunities for businesses big and smallSomebody must lose if it is embraced across the board and I assume that is the very rich and the crooked.
Yes, but the biggest problem is a certain stubbornness in the heads of some people to let go of monetarism. We have seen many people here on pfm who cannot get to grips with the logic that tax does not fund spending, but can’t say how it does. Much of the anger directed at MMT, as can be seen from klfrs above, is based on misunderstanding and a determination to cling to those misunderstandings in the face of reason.Is it that MMT hasn't really got a chance to work because there are so many vested interests and greedy corrupt groups across societies?
That is a good post, but my objection here is the reference to “roads to nowhere” which comes from an old monetarist attack line against Keynes. I know the op is identifying the road to nowhere as a false analogy but feel it needs unpicking to identify MMT a bit more. MMT is not about creating work on roads to nowhere, but to using available resources to fulfil need. We don’t need roads to nowhere, but we do need more doctors and nurses, more care workers and much more infrastructure to tackle climate change. Road to nowhere, no. Cycleways as part of a connected infrastructure to get more cars off the road, yes.This post made a lot of sense to me but nobody appears to have responded to it.
<a href="https://pinkfishmedia.net/forum/thr...nhs-mmt-economics.260713/page-32#post-4536121">The Fight for the NHS/MMT economics</a>
If you haven’t watched the video how do you know about any pitfalls?Haven't watched the job guarantee link. You have to be aware of all the many pitfalls in that scenario but again there is merit in discussing a living wage and how that can be delivered.
I think MMT falls down just like monetarism due to the human condition. Your suggestion about more Doctors, nurses, cycle lanes, critical necessary infrastructure, green tech etc etc are again all very worthy. But the problems that will inevitably pop up (Dido track and trace, Putin printing money for arms, Boris printing money for his wallpaper and refits) make it difficult to understand how the world could control the greedy and dysfunctional regimes who use this policy for nefarious ends.
The same problems I realize attach to any economic model. It would be nice if somewhere like the US or the EU started exploring the possibilities of gradually introducing MMT type projects. Agreed projects maybe like the pursuit of carbon neutral fuel, No Dido Harding projects(long jail terms if even suggested). Issues I see with the obvious worthy suggestions of Doctors and Nurses is the constraints and bottlenecks in the number of people you can train quickly and the resources needed to make it happen. On the Doctors and Nurses thing I also wonder are they afraid to make it too much better in case people start to live even longer?
But it is hard to argue against having the best medical system possible and if MMT could be teased out as the right route to get there then why not.
It would seem to me that the world has always strived to innovate when there is reward. A system that takes away that reward or appears to potentially throttle it could backfire if there is no incentive for commercial endevour.
Anyway you can see from my meanderings that I will not get a call from the ECB any time soon for my expertise
If you haven’t watched the video how do you know about any pitfalls?
Sorry, but you haven’t understood the job guarantee. The buffer stock of employment is in contra distinction to the monetarist need for a buffer stock of unemployment. The rest of your post seems to assume that the unemployed are feckless, which rather misses the point that the JG would operate under existing employment law, so fecklessness can be dealt with, or are you suggesting that feckless is so endemic in the currently low paid and unemployed that low pay and unemployment is a buffer stock against fecklessness?Because I can have an opinion based on my experience.
I went off and spent the time watching that video hoping I would get a wonderful new insight into a new special type of job guarantee. Buffer stop seems to be his name for it. His views are similar to your babe Steph. They sound wonderful in a perfect world with the majority of humans looking to work hard or honestly most of the time. Reality is that is not the case. Do you think it is possible to take the long term unemployed and turn them into the tutors and the extra institutions required to produce all the needed Doctors, Nurses and all the other disciplines required to deliver free health care for all?
His view on the micro scale interventions at local level again sounds great. I have seen government schemes work very well but again this man ignores the fact that a lot of humans just want the money not the work.
Would you be in favour of taking the long term unemployed and doing an MMT on them by giving them say for instance the average industrial wage if they engage in full time government or local schemes that are needed in their area?
Taking this summary as reasonable, we're still left with an understanding that increased spending leads to increased taxation though, it's just a reversal of cause and effect. If you spend, a la MMT, then you need to 'cancel' the entries in the ledger in due course, or the amount of money in the system becomes excessive and inflationary (this is my understanding). That implies taxation will increase.Hopefully everyone one now left on this thread is at least curious about where the logic that as ‘our government is it’s own currency issuer, it cannot therefore run out of the thing it issues’, leads us.
Monetarism is an idea that contradicts MMT at the very start of that observation by saying that government spending comes from tax.
Monetarism maintains that all spending is constrained by the tax intake. It maintains that it would love to spend money on making the NHS work, but cannot because there just isn’t enough money. Therefore to spend more would be irresponsible/we’re all in this together/printing money/inflation/Magic Money Tree/Far Left extremist ideology, any one who disagrees is a communist/there is no alternative. Any normal person will follow monetarist logic and vote Conservative.
Sorry, but you haven’t understood the job guarantee. The buffer stock of employment is in contra distinction to the monetarist need for a buffer stock of unemployment. The rest of your post seems to assume that the unemployed are feckless, which rather misses the point that the JG would operate under existing employment law, so fecklessness can be dealt with, or are you suggesting that feckless is so endemic in the currently low paid and unemployed that low pay and unemployment is a buffer stock against fecklessness?
Taking this summary as reasonable, we're still left with an understanding that increased spending leads to increased taxation though, it's just a reversal of cause and effect. If you spend, a la MMT, then you need to 'cancel' the entries in the ledger in due course, or the amount of money in the system becomes excessive and inflationary (this is my understanding). That implies taxation will increase.
So there's still a functional link between levels of spending and levels of taxation, it's just that the timing is reversed:
Monetarism: Taxation - -> Spending
MMT: Spending - -> Taxation
That seems too simplistic, so perhaps I've misunderstood, but I wonder if this is one reason why the MMT-decriers have a problem with it. It does seem to like the MMT route spends, in the hope/expectation of growth so the corresponding taxation is manageable down the line.
OK, all I can say then is that your understanding of MMT is a lot different to mine. You may understand more about MMT than me.I think I do understand it. I was just pointing out that your two MMT supporters are too optimistic in their views.
You mentioned feckless I didn't. You ignored the bit about taken the current unemployed and reskilling them to train up all the staff needed to deliver a much better NHS.I used that to simply point out the limitations that will apply to a lot of the ideas championed by team MMT.
I do believe there is an opportunity to grasp by possible carefully using MMT policies in specific limited areas but as Supertweeter points out above and even your two linked presentations mention there are strong inflationary pressures.
I also simply tried to point out that MMT depends hugely on honest brokers from top to bottom. The fecklessness you mention equally can be applied across the spectrum. It generally has greater consequences the further up the pay chain you go. But to simply ignore it doesn't seem like an option to me.
OK, all I can say then is that your understanding of MMT is a lot different to mine. You may understand more about MMT than me.
The Labour Party, the SNP, the greens, anyone you can think of, must all be able to see how the government has been financing a Covid response.
It has not been a secret,
there has been no borrowing,
there has been straightforward money creation to spend.
Its extraordinary they haven’t seized on it,
that nobody is saying loud and long,
‘Well there’s nothing to payback, of course this isn’t falling on our grandchildren shoulders…
…we’re not borrowing”.
There is no reason whatsoever that the money that’s currently being spent has to be displaced by a borrowing requirement.
Do we have inflation?
Have we have got a serious problem?
Do we need to withdraw money from the economy?
Well. No.
It’s the opposite.
Deborah Harrington
(Health Campaigner, Writer and co founder of the organisation of Public Matters)
The above is from the podcast (Deborah Harrington. The Fight For the NHS)
Deborah Harrington makes a compelling analysis of the current state of the NHS and the lies and misdirections from all parties that have led us to where we are today and the lies we keep being told about how the NHS needs to be funded in the future.
How do we get the message out there that what we’re being told about funding public services is not true?
Or do we believe the government when they say, "where's the money going to come from?", "we can't afford it"?
Just been doing some reading and came across this about tax from Bill MitchellTaking this summary as reasonable, we're still left with an understanding that increased spending leads to increased taxation though, it's just a reversal of cause and effect. If you spend, a la MMT, then you need to 'cancel' the entries in the ledger in due course, or the amount of money in the system becomes excessive and inflationary (this is my understanding). That implies taxation will increase.
So there's still a functional link between levels of spending and levels of taxation, it's just that the timing is reversed:
Monetarism: Taxation - -> Spending
MMT: Spending - -> Taxation
That seems too simplistic, so perhaps I've misunderstood, but I wonder if this is one reason why the MMT-decriers have a problem with it. It does seem to like the MMT route spends, in the hope/expectation of growth so the corresponding taxation is manageable down the line.
https://www.theguardian.com/politic...ts-to-nhs-and-doctors-pay-in-thinktank-report
Proper funding of the NHS is now critical. The Tories are a lost cause, but Labour, surely to God Labour, should not be led by Daily Mail headlines and should be proudly shouting for the NHS in terms of proper spending rather their usual mealy mouthed monetarist mutterings
That's exactly what they are doing. It's impossible to get nhs dentistry in many parts of the UK, so people are going private. At my practice they are not offering the same level of care, the tactic seems to be to offer you the "choice" of going private for treatment or extraction on the nhs.That's just a continuation of the Tory policy since 2008 to run down net funding of the NHS (and social care) to the point where it can't function properly, and then let the right wing press attack dogs peck away at its credibility (drip feeding stories like these; the recent orchestrated attack on GPs) to the point where they can sell an alternative which will mean opportunities for private firms to make money and profit over and above the care imperative.
That's exactly what they are doing. It's impossible to get nhs dentistry in many parts of the UK, so people are going private. At my practice they are not offering the same level of care, the tactic seems to be to offer you the "choice" of going private for treatment or extraction on the nhs.
Similar things are happening in orthopaedic surgery. Do you want 2years of pain or do you want to go private? It's the future model, I'm sure.
That's just a continuation of the Tory policy since 2008 to run down net funding of the NHS (and social care) to the point where it can't function properly, and then let the right wing press attack dogs peck away at its credibility (drip feeding stories like these; the recent orchestrated attack on GPs) to the point where they can sell an alternative which will mean opportunities for private firms to make money and profit over and above the care imperative.