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The ‘Faint Heartbeat’ Exchange: AOC Corners Powell On Phillips Curve Implications For ‘Modern’ Policymaking

"Modern policy making considerations." With an emphasis on "modern".

"Modern policy making considerations." With an emphasis on "modern".
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17 comments on “The ‘Faint Heartbeat’ Exchange: AOC Corners Powell On Phillips Curve Implications For ‘Modern’ Policymaking

  1. mfn says:

    I like that young congressperson. She’s going places.

  2. Pyrognosis says:

    I wish she and Justin Amash could start collaborating on actual policy so the good parts can survive and the bad parts join the dustbin of the Chavez model.

    • Harvey Darrow Cotton says:

      Yeah, there is so much a Democratic Socialist and a Tea Party Republican can agree on. It is such a natural fit it is a wonder people argue about politics at all. Everybody likes teh good parts, and nobody wants to be an embargoed Third World petro-state.

  3. Ria says:

    AOC is obviously bright and rightly points out that the Phillips curve for now at least belongs in the dustbin of history. The curve always had a problem and like many economic theories is far better in academia than in practice. The problem with the left wing of the Democratic Party is that they often want pretty radical change quickly which scares the public. Health care is a prime example. A reasonable approach would be to broaden medicare to 50 years old, broaden Medicaid as well, and up and make health care universal over a short period for the rest of the public. That does not mean medicare for all, but it does mean every American gets covered and the cost is at least subsidized based on income. A great use of a VAT which can be made mildly progressive if done correctly. The public is ready for universal health care, just not medicare for all…

  4. PaulMiller says:

    Considering that the U.S. already funds any and all wars with trillions, pays for my medicare and social security without full funding, provides a variety of public assistance for food and shelter, subsidizes various industries, mining and agriculture with inadequate tax revenue, one may already conclude that Monetary Money Theory is a proven actual practice.

    My concern is that the recognition of the above will have a deleterious effect on our culture. I expect that ambition, industriousness, responsibility and risk acceptance will be somewhat diminished on the whole. My brief travels through European countries that are socialistic shows me the contrary: People still are industrious, responsible, etc. But in this country, changing our culture from pioneers and rugged individualists, to the 32-hour work week, never-get-fired, retire at 55, 6 weeks of vacation model, may be too much, too fast.

    I’m wrong about a lot of things, and I hope I am wrong about this,too. MMT is here.

    • I believe you ARE wrong! We are not different than people in the countries that have provided for all. Having decent lives and less stress will reduce many BAD things (like homicides) drastically, and people of course will have more time to do community-related things that ENHANCE lives and communities. Other countires do NOT have a ‘never get fired’ model that I have heard, although they have many other things you mentioned. Sounds GREAT to me!
      Hell, RUSSIA has healthcare for all, 3 years maternity leave, 4 weeks vacation, and probably free college!

      The problem here in the US is that the corrupt hijacked our govt in the early 70s, and devised scams like ‘privatization’ to enrich themselves, feeding at the trough of basically unlimited federal money while LYING to dupe the public. That is why they want EVERYTHING ‘privatized’. They lie about it being ‘more efficient’, etc. It is the biggest scam EVER, and even Wall Street firms invest, knowing that profits are guaranteed via federal money! Our many dozens of war companies, many federal prisons, the detention centers (we HAD a system to process immigrants, but they corrupt always want to get in on a ‘privatized’ system to enrich themselves), our healthcare insurance and more – all privatized. Now they want public education (the ‘charter school’ push), infrastructure, the rest of the Post Office, the VA and more. Privatized entities bill the federal govt any amount, providing massive exec salaries and insanely high profits. I am trying to track down something I recently read about Congress critters getting ‘first dibs’ on buying in when these scams go public. smdh

  5. PaulMiller says:

    Modern Monetary Theory is what I meant in the first sentence above. Sorry.

    • vm1953 says:

      Dr John Hussman has written a nice piece recently on the Phillips curve and its link to Wage (not general price) Inflation. The Phillips curve may not be dead after all!

  6. jyl says:

    Lot of different theories get lumped together under the vague term “modern monetary theory”.

    On the Phillips curve issue that AOC addressed, it makes sense that if there is currently a valid Phillips curve, it is much flatter than before. Put another way, if there is a NAIRU, it is lower than than before. I look at today’s actual CPI basket e.g. here for 2017 and I think about how much the current unemployment rate in the US labor is likely to be a factor in the current price of each thing. In many cases, its hard to see a major factor.

    So, sure, I don’t see that very low UE is a problem in and of itself. The problem is that the policies that the government might try, to drive UE down, may have other effects.

  7. Canuck says:

    Refreshing to see a couple of intelligent articulate people having a conversation in Washington.

  8. Does the fed inflation indicators include equities? Seems like that’s where the ‘inflation is hidden’.

    • Anonymous says:

      That’s a point I made a while ago. Basically the money that was supposed to go into the economy, like the tax cuts, has gone into the market.

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