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‘Robert Cialdini Move’ Or Full-AOC? An ‘Apoplectic’ World Confronts MMT Juggernaut
To be honest, I had no intention of inserting myself into the increasingly vociferous debate over modern monetary theory.
It wasn't terribly difficult to discern that the discussion would rapidly descend into incriminatory farce once the battle lines were drawn. MMT was embraced by progressives in part because the theory can be used to rationalize (economically speaking) spending vast sums on ambitious programs that would otherwise be impossible to finance. On the flip side, MMT was chastised b
Dalio and Gundlach have weighed in some. How was WW2 financing different? And the VietNam War financial wind was yet again different based partly on oil perhaps? To me, there is only one concept in economics. That would be efficent use of resources. And perhaps the slaves that built the Great Pyramids were the first victims of MMT. We have all seen ridiculous deployment of capital cost countless human lives. It seems that even conceptualizing MMT with the clear myriad of social failures simply is evidence of institutional depravity.
I really don’t see too much difference between the religion of endless tax cuts for the already well off and MMT. Both are going to produce endless deficits, it is just who benefits is changed. When the naysayers start say we should tax capital gains the same as regular income to control deficits then I’ll believe them.
Your fears about your views being distorted will not happen Mr. H…. but as I said before the Primary proponents pro and con MMT will still likely not understand each other enough to accommodate a rational discourse..Good post thanks…both sides fairly represented.
MMTers recognize that loans create deposits, and govt deficits equal non govt savings, so the concept of ‘loan-able funds’ and ‘crowding out’ doesn’t apply. They recognize that the ratio between ‘printed money’ and the gold supply is a fixed exchange concept and doesn’t apply to a floating fx regime. They recognize the difference between currency issuers (US, Japan, UK) and currency users (Greece, California, Warren Buffet). They recognize, as Fed staffers do, that you can’t do a reserve drain without doing a reserve add if the Fed is to hit it’s policy rate, and that an overdraft on a reserve acct is effectively a loan, so reserve banking is about price, not quantity. Etc.
Indeed, as the final point insinuates, this is also a strategic-competitive issue and the US is behind on the new playbook. Why the cognitive dissonance when extending our longtime, endless use of ‘MMT for defense’ into areas that actually improve people’s lives and make better use of their human capital?