Thanks Ian.
I’d be interested in hearing people’s thoughts on the mind boggling popularity of establishment democrat blogs like Eschaton, Hullaballoo, and LGM. To steal Dave Niewert’s phrase, I sometimes “spy-hop” them, and have been known to do some progressive Webstirring. My question about Stephanie Kelton comes from one of those “stirs,” wherein, a commenter under the pseud “rhymes with mofo” stated, and I quote:
“Kelton’s a fraud and a handmaiden for TPTB, a grifter who is paid to assure the rich their taxes don’t have to go up, and who to blame for not making good things possible: the gummint. That’s not leftie, that’s pure Teabagger.”
Among other things, most of the commenters over think that to talk about “neoliberalism” is oh so “boring.”
Nearly everyone blames either Russia, or racism, for Hillary’s loss to Trump rather than her, oh so boring, neoliberal policies and war crimes.
Progressives handed the election to Trump.
And anyone who dare post progressive narratives is immediately labeled a “Trump helper elf.”
And the tragedy … there is a TON of traffic on those sites.
Am I missing something? What’s the allure? Why are so many of them so dead set against policies that could actually help people in this county?
I hope I’m wrong but I don’t think Khashoggi’s death is the end of the line for MBS/Saudi Arabia support among the Anglo-American elites, KSA got away with 9/11 and blamed into Iran, heck, I’m betting that there is already a conspiracy theory blaming Khashoggi’s death on Iran.
About Kavanaugh, he should have been confronted fro being a Bush Republican who helped to pass the Patriot Act, not for being a drunken mick. This has been said before but you can overstate of how much the Democrats helped to rehabilitate the Neocons from the Bush Administration, look at the bizarre speatcle that was McCain’s funeral(s)!
I don’t think Eschaton is a Democratic establishment blog. If you look at Atrios’s Twitter, he criticizes the party establishment quite a bit, as well as the media environment that has decided that the Democratic establishment is the only acceptable “left” politics in America.
Dave Niewert and I have lived in the same neighborhoods down through the years, have met briefly a time or two, and I have long followed, have sourced in my own writing, his work. I would venture that as the internet persona for the Southern Poverty Law Center Dave is the “establishment democrat blog.”
Apples and oranges, I suppose. So too comparing individual efforts to a group. Digby’s masthead lists four bloggers, only two of whom post daily, and Dr Black’s daily one or two guests invariably post no more than open threads, while LG&M hosts better than a dozen writers, only half of whom post daily. Though the latter tend to centrist democrat not all are firmly in the Clinton Crowd, and I wouldn’t classify any of the three as “establishment”, or even mainstream.
I am surprised and wonder why you’ve targeted these for your ire, and not DKos, or Crooks and Liars. Those are your mind bogglingly popular establishment democrat blogs.
Dave Neiwart’s a genuinely good guy. When I first started at FDL he was the managing editor, and I was the second editor. We talked almost every day. Good man, and a real journalist.
I like Atrios’s views on most things. I like Digby personally, but often disagree with her.
I like LGM as much as they seem to like me. Take that as you will.
And again, same with LGM generally. Eric is great and SEK used to be. Establishment dem followers … not so much. The progressives seem few and far in between.
Now you’re comparing apples to onions. As we all here know commenters are easily “stirred up”, but few wrap their fingers around over there there’s so many – with comment threads running in the hundreds and occasionally over a thousand – it’s about like stirring water in a bucket.
Digby turned her comments off about when I did, six maybe eight years ago, as I did: because of the virulence of commenters (though occasional comments are posted to the mobile site).
I won’t follow a comment thread much beyond fifty posts, get’s too far off track.
There was a split in the Democratic Party after Obama’s election that gradually and quietly widened beneath the surface, so to speak, until Hillary Clinton’s primary campaign fight with Sanders brought it into the open.
The Democratic Party was moving away from its populist heritage for decades, but Obama and the Clintons very deliberately institutionalized the straddle: mobilize popular electoral support on the rhetoric of economic issues and the symbolism of civil rights, but deliver actual policy to the finance sector. Actual left policy and ideals have been an increasingly distant memory for decades!
If you actually opposed senseless war or favored economic benefits for the majority of the population (higher minimum wage, union organizing rights, Social Security, Medicare-for-All), your place in the Democratic Party is as a pawn, owned and destined to sacrificed, in order to put in office the evil of the so-called lesser evil.
Hillary Clinton’s candidacy in 2016 was the culmination of a long process of evolution in the straddle, in which the increasingly cynical Democratic Party establishment furthered its political strategy of harvesting votes for the Party’s heritage and selling them to banksters and the plutocracy who want policy favorable to their interest.
The partisan combat of an election campaign requires a lot of propaganda to mobilize people into the opposing camps behind the candidates. That means helping people rationalize and build denial. The Democratic straddle is particularly demanding — really the Republican straddle is a big strain as well as the greedy try to lead the religious and patriotic — as you, a leftish Democrat, have to argue yourself into supporting a candidate who is committed to screwing you on every damn issue and wants not to win too much power (for fear of having to deliver something for voters at the expense of donors).
Of course, LGM is a comment cesspool. Scott Lemieux. Hello? Reading his political arguments for the straddle invites necrosis of the brain.
I like Atrios. A lot. But, on some level, I know he is packing peanuts for David Brock.
digby at Hullabaloo was once one of my favorite voices, but I do not even look now.
The cognitive dissonance of the straddle is really hard on the thinking processes of anyone identified with the Democratic Party. If you can say, “Hillary Clinton is a monster” from a left perspective, you are probably able to see her candidacy plainly. But if you have to think her family Foundation was a charity dedicated to doing good work, that Hillary has always been a fighter for children and women’s rights, that she is a sober realist in foreign policy who deliberately avoids wars, that she favors campaign finance reform from a high ethical standard, and so on. Possibly today you think the Russkies conspired with the Donald to take it away from her and as a consequence the rules-based international order and the economic ideal of free trade is in danger. Perhaps you think the 35 year old grievance of a privileged self-involved woman against a drunk 17 year old should be dispositive with regard to a Supreme Court nominee (because no one wants to oppose his jurisprudence or even his amoral partisanship on the merits).
It takes a lot of abusive bullying and absurd rationalization to keep the straddle going in either Party. That propaganda is a design feature of politics in a plutocracy.
Still look at Atrios from time to time though I skip the comments. It was finally Eric “world’s biggest scissor-bill who won’t shut up about labor history” Loomis that drove me away from LGM, though I stopped reading Lemieux’s blue doggerel about a year before(is he bucking for Friedman’s job?). Been a while since it seemed like Digby had anything to say, but since the last election, I dropped a lot of blogs that just seemed to engage in purely partisan blither. I just don’t have the patience for it anymore. They seemed like lefties but it turned out they were just Democrats. It’s like a bumper sticker I saw the other day “I’m proud to be everything a liberal hates” and I just thought “A genuine Leftist?”.
Scratch the surface of the primary theorists of Modern Monetary Theory and you find a lot that is neoliberal/neoclassical. This is unsurprising. Most of them or their mentors were trained in neoclassical economics. There were certain issues they had beefs with traditional economics on, but there was never a fundamental rethink and so much of the substrate of neoclassical economics remains. (And neoclassical economics with a few libertarian flourishes is the essence of neoliberalism)
The first time this really hit me was with the jobs guarantee. The MMTers saw this as a place to dump excess workers until the private sector had need of them. Originally, they saw these jobs as temporary, minimum wage, make work affairs. And they didn’t much think beyond this until people like me started criticizing them for it. We got them to add some verbiage about a living wage. But they never moved their view from market-centric to person-centered. A real jobs guarantee would offer meaningful ongoing work, chance for advancement, and a corresponding living wage. However, if a JG offered this level of opportunity and security, why would anyone want to abandon it for the vagaries of the markets of the private sector? In other words, a real jobs guarantee that put workers first would completely undercut the MMT market-centric purpose for one.
Then there is the MMT stance on taxing the wealthy and corporations. Randy Wray says don’t bother trying to tax the rich because they hide their wealth too well. As for corporations, they “earned” their profits and should be allowed to keep them. For MMTers every problem can be solved by the government simply printing more money. The distribution of that money doesn’t matter to them. That 95% of the money creation in the US occurs through the regional Feds, that is the private side of the Fed system doesn’t register with them. They also ignore bubbles. For them, the only constraint on money creation is full employment. Kelton’s remarks are fully in keeping with MMT and that is just one of many reasons to reject MMT.
Food for thought.
To Kelton’s credit, she does argue for redistributive policies in regard to MMT. For example, you can achieve the same purposes that a massive tax cut for the rich achieves by, for example, slashing student debt, or investing in infrastructure.
Reaction to Khashoggi’s state-sponsored murder should be a no-brainer. But we have a President who is an idiot and a coward. So he will only take the actions he is forced to take. I had to laugh at the threats of retaliation the Saudis are putting out against any US sanctions. Like pretty much every other oil producer on the planet, the KSA needs to pump as much oil as possible to keep from imploding. As for the KSA shifting to Russia as an arms supplier, this has two major problems. Most of their advanced weapons systems are American. They need the US for spare parts, and it would take years for them to switch over their inventory. We’re talking tens and tens of billions of dollars and ending up with systems that are inferior to what they could have gotten from the US. This also ignores the political realities. Russia is currently backing the Shias in the Middle East, the people that MBS is waging a jihad against, and this includes the Saudis’ arch-nemesis Iran.
Bruce:
Yeah, we seem to be traveling the same path. I’m so over those that seem all too willing to rationalize away the shortcomings of the Dem party. And I’ve used exactly the same term in relation to Atrios v. his commenters — cognitive dissonance. You’re just left scratching your head going … “Did you actually read what he’s saying?” And yeah, he just posted media matters as proof of one his arguments just the other day.
DMC:
Amen on Lemieux. As to Loomis, I’m interested in Labor history, but I got the feeling he just uses the site as a notepad for his books in that respect. Being a treehugger, I do like his environmental work. About the only redeeming part of the blog since SEK died.
Over at Naked Capitalism it is too the point where if you disrespect MMT snidely enough, you may become persecuted all the way off access to commenting. I remember referring to it sometimes as Magical Monetary Thinking. I once asked if a Trillion MMT Dollars could bring back the Passenger Pigeon. And so forth.
It might be a worthwhile project for non-banned commenters to every-rare-now-and-then raise fatal and lethal questions about MMT in the politest possible way and see what happens.
The “Free-lunch” aspect is that the Magical Monetary Thinkers think they can dodge and evade the whole question of Social Class Combat and Social Class WarFighting. Just take control of the Monetary Keyboards and keystroke some Magic Money into existence.
I lost interest in most of the blogs mentioned here. Ian’s is the one site I know of which tolerates progressives, that is the non-Democratic, non-liberal Left.
I find my comedy where I can. A couple of weeks ago, a relation told me I was responsible for Kavanaugh’s confirmation and Donald Trump because I had not voted for Hillary Clinton. We totally talked pass each other. I pointed out that no one owns my vote, and if the Democrats had wanted my vote, they would have nominated somebody who represented what I think is important and who was willing to fight for it. Instead they found the worst, most pro-corporate, elitist they could and tried to shove her down my throat in a rigged primary process. Still my fault as far as my relation was concerned. I was surprised but I think this is still the view of many Democrats. The lesser of two evils. Vote for the Democrat because the Republican is worse.
different clue:
“Over at Naked Capitalism it is too the point where if you disrespect MMT snidely enough, you may become persecuted all the way off access to commenting.”
True. I’ve seen it happen. I pretty much split time between here and there. Although, I do most of my commenting here simply because of the variety of points of view. It can get pretty tribal over there, too.
Any theories on why Ian attracts such an eclectic group?
As to MMT specifically, I agree with most of the comments here. It’s plain that our neoclassical approach is a farce. But at the same time, I don’t think MMT has all the answers as some would have you believe. And to say that it’s just printing money into existence is disingenuous. It definitely seems like a better way of managing growth through deficit adjustment than the current neoclassical myth.
I sometimes read LGM for Loomis’ posts on labor history but Scott Lemieux and the rest are pretty bad. The comments are even worse. If you even suggest that Hillary Clinton ran a bad campaign you will get piled on. I have noticed that partisan Democrats are more defensive about their politicians than Republicans. I have many Republican friends and relatives and when McCain and Romney lost they had no problem recognizing that they were bad candidates and ran bad campaigns. Partisan Democrats on the other hand simply refuse to admit that Clinton was a bad candidate.
I suspect that many of the people at LGM and other partisan Democrat blogs are the kind of “front row kids” who are not used to people criticizing them. They were always the “A” students and they get flustered when people disagree with them. Getting beat by a boorish reality TV star like Donald Trump was the ultimate embarrassment for this group. They were so convinced of their moral and intellectual superiority to The Donald and his Deplorables that their loss shattered their worldview. In order to repair this worldview they have to fall back on Russia Russia Russia or on racism as the only factor in explaining why people voted for Trump. This way they can both shift blame and maintain their sense of moral superiority. Nothing is their fault and their opponents have no legitimate grievances about things like the economy instead it is all about white male privilege.
Webstir, I have no problem with a trillion dollars to pay off student debt. But you have to ask where does the money go after that. Most of it ends up in the hands of the rich and only increases wealth inequality. What you want are high taxes on the rich so that trillion dollar upward transfer is extinguished. Money is about moving things around a society. If money always goes upward, its primary function is subverted.
Stopped reading Atrios about the time of the crash leading to the Big Recession. He was supposed to be something of an economics perfesser, but he essentially had nothing to say about what was going on and what had led up to it, I assume to protect his field virginity. His commenters had long since gone into Dali-land, and if you enjoyed the surreality of it all, that was the place to hang out.
Digby became a repetitive Democratic Party PR enterprise with literally nothing to say beyond the Party Line, and when she terminated her comments — not because they were particularly vicious but because too many commenters defied or just questioned the Narrative being sold — there was nothing (much) of interest. She’s still a good writer. With nothing (much) to say.
NC strikes me as a Republican/Oligarch Party cut out. Kind of like dKos (at least the front page). They are “progressive” in much the same way the early Progressives were. Their main objective was to ensure the populist left never achieved power sufficient to overcome the power of money. They were largely successful.
So far, to his credit, Ian doesn’t seem to have or impose a Party Line of any kind.
If money always goes upward, its primary function is subverted.
hmmm. I am not sure that extraction and upward distribution is not at least a secondary function of money. Money, if we are to believe the chartalists, was invented to facilitate the state’s emergence in the practice of fiscal separation, i.e. the distinctions among public finance and public purchase and public provision that give rise to the institutions of public and private debt, payment and banking. Of course, extraction in obligations of service and provision in kind were institutionalized with only minimal reference to money as specie in the local autarkies of subsistence feudalism, but the point is that more sophisticated money and finance facilitated more sophisticated and elaborate social hierarchies.
Re: MMT at NC: A post currently headlined has this passage:
. . . I trace the historical repression of chartalist ideas to the rise of modern Western metaphysics through the negation of the medieval Scholasticism of Thomas Aquinas. I uncover the impoverished social topology upon which both Liberal modernity and critical aesthetics have historically relied.
Money!! The selectively permeable membrane of the State? What if non-State civilizations also created money without then crafting a State?
I don’t know the history of the Phoenician coastal trading cities well enough to know if they were Genuine City-States or whether they were coastal trading cities which never felt they needed a State structure so never bothered to evolve one. If indeed the second choice is so, and yet they evolved money, then what was money for in their civilization? What purpose was it serving that would serve no Chartalism-invoked need?
I suppose if someone were to try blaming me for Kavanaugh because I didnt’ vote for the Evil Clinton, I would say something like: ” I wanted Sanders to be my Democratic nominee. But the Democrats wouldn’t let me have my Sanders, so I wouldn’t let them have their Clinton. Sanders might have won, but they nominated their Clinton, and the rest is history. Nominations have consequences.”
Especially that last sentence . . . “Nominations have consequences.”
About the Digby blog, I remember she time-outed the comments a couple years before final closure, because of vitriol. But I don’t remember any major vitriol in the last few months before closing. What I remember is she brought a semi-pro little Democratic Operative named David Atkins onto her blog, and she worked with David Atkins to introduce various kinds of strangling, ghosting, stealth retro-erasing of comments, stealth banning, etc. She did this strictly because
disgruntled former Democrats weren’t eating the dog food anymore, and were telling all their fellow dogs just how bad the dogfood really was, and why.
Long before that, I remember reading a Digby entry at some kind of “wise clever party operatives” blog whose name I forget . . . writing about how “self-indulgent identity-left challenges to the Democratic party could not be tolerated or permitted”. So Digby’s true essence was made known to some a while before the erasure of comments, which by the way included erasure and destruction of all the archives and archived comments.
Eschaton commentariat are an ecosystem, or more like a compost heap. One imagines them in their wheel chairs clutching oxygen bottles as they battle the great russian menace, Trumpism. Like Hillary, a bunch of closet Birchers. More and more they reject the guidance of Duncan, who is to their left it seems. Any new name that tries to comment is virulently opposed and most give up. A sad situation.
I thought part of the progressive game was always wanting to debate towards a better way, while all the other tribes ‘just know it’ already.
Is there an online anywhere that places these people on a liberal-progressive spectrum chart (among other things), or gives a clear and pithy description of their apparent (and maybe real, where they get their funding, etc…) positions? Should there be?
You should know you are talking nonsense. The investors who supply student loans may add to the cost of education but are not the cause of the high cost or debt. Rising tuition, books and R&B are driving higher education costs. Taking away their interest gains with taxes would end investors loaning this money. Even the government makes a hefty profit from their student loans. The problem is that too many students choose to study and get degrees in areas that don’t pay very well and are not in demand. We have free tuition here, paid for by our lottery, but my son still had a fairly large debt when he graduated. He chose a high demand/pay field and is very good at what he does. At 30 he is earning a six figure salary and had no trouble paying his debts.
bruce:
The word money and property are virtually synonymous. Money simply being a subset of property. If you understand what property is, you understand what money is. Trouble is, very few understand what property is. Property is simply a social contract of various rights and duties. Meaning, it’s whatever we all agree it is.
That our constitution enshrines property by commanding just compensation if taken by the government is simply the shape of the duties and obligations we call capitalism (again, synonymous with property). You just described that “particular” system, not money.
different clue:
Re money, see above. But yes, there are no duties without the force of the state to penalize those who don’t obey. And, it’s semantic to wonder whether the Phoenician cities were states or not. If they formed a system of rights and duties, of which power could consistently be brought to bear if said duties were not honored — then they were states. Being traders engaged in commerce, I suspect that’s the case. Like I said a couple of posts back — without that power all bets are off and things rapidly devolve into the law of the wild west. How big is your gun, and can you pull it after than the person screwing you over?
Question: why might Ian Welsh be attracting a mixed lot of readers and commenters?
Possible suggestion: his posts do not seem to offer very much comfort or validation to psycho-tribally identified people. People who come here have to accept that they may not have their fondest belief systems or their personal identity therewith praised, supported and validated. So they stay for the challenge and maybe the learning.
The word money and property are virtually synonymous. Money simply being a subset of property.
Yeah, no, not virtually synonymous; the difference is critical and neither is a “subset” of the other. Money and property are complements, I suppose you could say, and the distinction between money and property and the selling and leveraging of property with and in terms of money is at the core of capitalism as a system of organizing economic activity. Property, as you say, is the bundling and attachment of political power and rights to legal ownership and it is the exercise of that political power to organize and command and bargain thru the medium (and by the calculated accounting of) money and finance that drives capitalism. So, different and distinct, but entangled in complex ways.
I agree that both money and property are social constructs. In that sense, both are “virtual” — parts of a socially-constructed, institutionalized fiction papering over our uncertainty and ignorance about the “real” world. I would not leap to “it’s whatever we all agree it is” for fear of implying that “whatever . . . it is” is not deeply conditional on and adaptive to what we know and learn about reality. I think that’s the hard part in understanding money: the relation of money to pervasive uncertainty.
Money, I like to say, is a language for writing fictions. Politically, part of the struggle is to find ways to favor “true stories” over fraud and fantasy.
“more sophisticated money and finance facilitated more sophisticated and elaborate social hierarchies”
The chartalists are, of course, wrong. It is rather the other way around. Economists have the absurd idea that first there was some strange beast called the economy and it invented society to serve it. Or that one of its bastard offspring is the state which slouches through history after it.
There have been many different kinds of state throughout history. They do not exist independently of the people who run them and almost always these people have run them to enrich themselves. Most of these states have nothing to teach us about anything. But some do. I draw a lot from the Greek notion of the polis and Aristotle’s analysis of it. Doesn’t mean I would want to live in one of those Greek city-states, but the ideas that the polis is the community of the people, ethics is about being a good citizen of the polis, and ethics governs both political and economic activity are essential to fix what is broken in our country.
Peter, we do not exist to serve the economy. The economy exists to serve us. Universities should not exist to be overpriced trade schools, but to enrich the quality of our lives, form us as good citizens, and only then to train for industry.
Tuition costs keep going up because universities are being run as corporations, and because the rich who have all the money continue to defund them by not paying taxes and having their bought and paid for politicians steer money away from them.
Education should not be some profit source for investors except in an end stage kleptocracy.
I believe New Mexico has a program for needy students.
He chose a high demand/pay field and is very good at what he does.
Russian troll farms will only pay as long Putin’s around. Whith meritocracy dying, things depend on one’s relationship with the boss. OTOH, if he’s in business for himself, my hat’s off to him.
Well, we all have our definitions. I’m sharing the definition lawyers use. Which is useful, as, no matter how you dice it — it’s all law. Which, again, is simply a social construct of agreed upon norms.
From there, it’s a chicken and the egg problem. Which came first, property or money? I’ll submit that the first time someone said “mine,” { https://www.youtube.com/watch?v=p-3e0EkvIEM } and used force to substantiate the claim, property came into being. Money evolved later to help with the portability problem.
Thus, a subset of property law.
And law schools have teaching, not incorrectly, that ALL law began with property law.
I’d be interested in where how you came to form your definition, because I’m simply reflecting nearly a thousand years of common law jurisprudence.
The definitions economists bandy about only serve to reinforce the legitimacy of their profession. They don’t know what they’re talking about.
RE: MMT, its central problem is the advocacy of fiat money creation, with taxes being used to “drain” money from the private sector and control inflation. They think the closing of the gold window put us on a pure fiat currency, and they look to the post-Reagan era of top-down control, big deficits, and wage/inflation suppression as illustrative of how the government and economy should work, but then promise to be better via the job guarantee and more generous social spending. Basically, take the reactionary Reaganite framework and direct spending through it to some New Deal-ish programs, all the while trying not to let a fiat currency explode. Bad idea.
I wrote a post a little while back that picked at some common MMT arguments. Call it the negative case for an anti-MMT. I plan to eventually right the inverse, building up an actual positive case for how to run a political economy. That’s going to be much harder though.
NM has free tuition for all resident HS grads, my son got it for 5 years including one year studing in Japan. He speaks 5 languages including Chinese and writes computer languages but no Russian.
Reposting this here since it looks like the other thread may be closed:
Leftover from preceeding thread before catching up (if I catch up) on this one: (sorry, my power was out all weekend due to lightning strikes, not that I could even get home Friday due to flash flooding and wound up sleeping in my car both Friday and Saturday nights, which I realize sounds trivial when you look at the Hurricane Michael stuff, but, that’s why I’m way behind)
@Webstir — re: RC’s legal knowledge — he’s previously said he worked on the Innocence Project and graduated from Cardozo, iirc. I realize from my own sitch that “decades ago background” & “current working knowledge/memory of what you used to know” are NOT the same thing (that’s why I qualify or am general about so much of what I say; I don’t know what all the changes are, and don’t remember definitively a lot of what I used to know, and I’m not even gonna try w/stuff like “jurisdictional differences on term limits” since I never knew all of those) but my memory can be highly selective based on “level of interest” so there’s a very good chance he remembers (or has kept up with) stuff a lot better than me. And honestly even if someone’s not/never been a lawyer doesn’t automatically mean they can’t be up on this stuff; I betcha half the paralegals and legal secretaries know this stuff better than half the people they work for, laypeople in unrelated fields could be afficianados who keep up w/it out of greater interest than people like me who fell into it, etc.
Not meaning to diss you there, you’v made a lot of good points in these threads.
@RC — I have a livejournal (https://mojave-wolf.livejournal.com/) I barely use anymore & a twitter account (@ThisWickedWorld) if you want to get in touch w/me via either of those. Otherwise I’ll try to find some way to get you an email addy w/out posting it for all the world to see & spam.
@Metamars — agreed w/the need for a twitter alternative, for similar reasons. I was part of a discussion a few weeks ago about whether there was any chance of forcing them to be considered a semi-public commons, or sort of a “for profit public square”, where they were partly subject to general free speech standards despite being a private company. I think you could make a case for this, but since it’s a long uncertain (and possibly losing) road to make that case, an alternative place to go would be nice (and might serve to keep them from becoming overly draconian)
& yah, we had different assessments of Ford’s credibility. While agreeing w/you & RC that she could have been coached, locked and loaded, I don’t think that is what happened here. & Kavanaugh’s efforts to defend himself served to hang him in my eyes, but, well, again, we came to different conclusions there. I will (strongly) disagree w/some here about the viability of prosecuting him now. Technically, could you? Yah. Should you? No. Are you likely to win? That will depend 100% on the makeup & biases of the jury pool, most likely, assuming at least basic competency on both sides from the attorney. Always a factor but way too much so here.
I would say at least 1/3 of my female friends & acquaintances from back in the day had something in that ballpark or worse happen to them back then; I don’t think a lot of guys realize just how bad some other guys are. (one thing I know from having a lot of girl friends –as opposed to girlfriends — back then, many guys behaved very differently toward women away from the crowds; most are better but some are scarily worse, and a lot of basically decent people will go along w/awful stuff if they think it’s what they are “supposed” to do or if some other guys start doing it and they don’t want to be accused of being unmanly or insufficiently supportive of their brethren or something; I am unsure to what extent this is better or worse or neither now)
There is no particular problem with having a fiat currency. The value of money comes, not from taxation as per MMT, but from the belief of the people in it and their willingness to use it. Government has a secondary role in establishing value for money on the spending side.
Lincoln used fiat currency in the form of greenbacks to help pay for the Civil War. And the value for that money was mandated by section 4 of the 14th Amendment: “The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.”
The US does not have a pure fiat currency because almost all money creation in the US occurs through the private side of the Fed.
Whoa, great comment thread! Sorry to be late. I will try to return in defense of MMT but at least for now please consider, as I believe Hugh originally taught me (although G. Simmel gets the academic credit): money is a claim on the resources of society (of which property is a subset but by no means exhaustive). Don’t confuse money with anything real. It’s entirely a social construct.
Nice to hear some slagging on MMT around here. Happy to step into the fray.
I urge you to try to separate the MMT model (theory, if you will) from the people who invented and promote it. What MMT teaches that seems most important to my thinking is the full range of policy space in which we can operate with a fiat currency. It’s a very wide space. All that guff about we can’t afford things comes down to real resources not money. If we have the will and the capacity to do something, money is no object, indeed it’s a useful means.
Michael Hudson is the guide to choose for moving over to political economy from the technicalities of money. It’s bankers that most need dealing with. Their undemocratically granted authority to create money in the forms of loans and deposits basically gives them command over any of society’s resources available for sale. And neoliberalism strives to ensure that everything in society is for sale! Throw in compound interest you get rule by bankers: debt enslavement. Sound familiar?
Imagine we had democratically elected committees that existed only to award grants to local organizations for hiring (job guarantee here) and raw materials, to serve local needs. Preschools. Elder care. Community kitchen. Landscape services. Home repair. Clinics. Transportation. We could make it quite festive, and give out awards at a huge annual party to local services that really stood out. MMT makes that possible, without necessarily raising taxes. But of course taxes should be raised on our wealthier tiers.
The reluctance to tax that you hear from some prominent MMT advocates is a regrettable policy but it doesn’t come from MMT. It is part of the very wide policy space, but there are better places. Tax as a tool for redistribution (as well as moderation of demand) needs to come back big time. Perfect tool for correcting imbalances of income and especially wealth distribution. MMT is indifferent but we are not.
Please forgive my self-promotion. I invite all of you who despise MMT (and everyone else, too) to take a crack at my essay Getting Money Right and pound away wherever you find I’m wrong. Many thanks!
Question from a totally untrained layman . . . In the “modeled-or-explained-reality” side of MMT world, if we did pure de novo issuance of federal money for first-instance federal spending, and we mandated zero federal taxation, what would happen as we kept issuing more de novo money for ongoing first-instance spending ( either unique project like big power dams or ongoing periodic payments for spending by the recipient of those payments . . . like Social Security) ?
What would happen sooner and then later? Would there be an End Stage / End Game for the issued money as its amount kept rising? If so, what would that End Stage/ End Game be? Assuming no federal taxation ever? EVER?
Never dealt with a Livejournal before, tried to open an account at your address, would not go through. I am not on Twitter, and don’t care to be.
Perhaps Ian would care to help? If so, I hereby authorize him to email you my email address on file at this website, or, alternatively, to answer an inquiring email from you to him by providing you with my email address.
Unless you have another idea for getting in touch.
BTW, I interned with the co-founder of the Innocence Project (Barry Scheck, who also got OJ off by handling the DNA part of the case, both after our association), then worked directly for the judges of the second highest appeals court in New York, a very special court with a hot bench and interests of justice jurisdiction, where every opinion gets published, and I wrote the opinions on most of my cases. My job was to write a comprehensive report for the judges I selected to be on my cases, refining the relevant facts and evaluating all the arguments by all the lawyers. (Just ask Webstir to explain to you what “interests of justice jurisdiction” is, and how rare and special such a court is-I’m sure he’ll be happy to display his extensive and thorough legal knowledge lololol.
Hope to speak with you soon, amigo. I’m sure it will be interesting. 🙂
Stanley Dundee:
And a sociologist steps into the definition of money fray. Well then, must be an expert!
How can people get this so bassackwards? It’s so damn simple. Why do people want to complicate it?
You’re simply distinguishing real property. Think land and fixtures attached to the land that can’t be moved. There is also personal property. Think tv’s, clothes, cars, refrigerators, etc. And there is intangible property. Think currency, stocks, bonds, mutual funds, insurance policies, equity, accounts, liens, etc.
While each category is dissimilar, they all share a couple of commonalities. Each comes with unique sets of rights and duties. Each can be stolen. And once stolen, each requires drawing upon the power of the state for recovery. Thus, money is a subset of property.
Are you guys all playing a joke and gaslighting me? Every 1L in the world knows this.
Ok. As invited, I pounded you on the definition of money.
I give your MMT analysis a standing ovation! You nailed down what I was ineptly trying to state above in regard to Prof. Kelton.
Stanley:
I’m reading, and it occured to me that your Simmel quote, “money is a claim on the resources of society” describes the rights that money confers, but fails to describe the duties. Not stealing it, for example. As Bernie Madoff found, that quickly turns you into neither a sovereign, nor a subject. You become a ward of the state. Other duties? Don’t destroy it. Don’t make your own. And don’t misrepresent how much you have. I’m sure there are others — working from the top of my head here.
This whole thing we call “society” is what we call the hodgepodge of rights and duties we’ve cobbled together throughout history, which through momentum alone, persist. There are no rights, without corresponding duties, in a society.
@different clue
“and we mandated zero federal taxation, what would happen as we kept issuing more de novo money[?]”
You’re absolutely right. It’s not smart to mandate zero federal taxation.
The MMT line on taxes is developed from Abba Lerner’s Functional Finance, which said that the main reason to tax was to remove money from parts of the economy where the money is unnecessary or harmful. It may be that some people get confused between that and the other MMT statement that State spending doesn’t depend on taxation. It’s more accurate to say that taxation depends on spending.
Possible suggestion: his posts do not seem to offer very much comfort or validation to psycho-tribally identified people. People who come here have to accept that they may not have their fondest belief systems or their personal identity therewith praised, supported and validated. So they stay for the challenge and maybe the learning.
I couldn’t help but notice that this is from the person who said they don’t read my front-page posts unless I’m writing about climate change.
In the very baldest simplest terms, what makes it not smart for the federal government to declare and enforce ZERO federal taxation while de novo issuing and spending-in-the-first-instance into the economy the newly keystroked-into-existence MMT money? I am assuming the money does not self-extinguish as soon as it is spent. I am assuming the money is intended to last and last in terms of being able to be spent again and again from hand to hand to hand on any this-or-that which is made or done anywhere in the economy in exchange for that money. I am assuming that the MMT money supply just increases by exactly the amount of the de novo issuance of the MMT money.
So in the baldest and simplest possible terms, what happens to the spending power, the publicly accepted value , of each unit of MMT money as the number of those units just goes up and up and up while the government takes ZERO units of its own MMT money units back as taxes?
Why exACTly, explained in the very simplest terms for the total layman to understand, is it “not smart” to mandate zero federal taxation of any of this MMT money? What exACTly happens to the worth and economic-transaction-interchange-facility usefulness of the ever-rising amount of MMT money?
I have done my best to make the question exACTly asked so as to make the question exACTly answerable. If it is still not exACTly and BALDly and LITERALLY answerable with Army Field Manual clarity and exactitude, then I will have to fall back on the O’Reilly method of getting the question answered. I will have to say ” this is exACTly what happens, in DETAIL. Or am I wrong?”
There is no particular problem with having a fiat currency. The value of money comes, not from taxation as per MMT, but from the belief of the people in it and their willingness to use it. Government has a secondary role in establishing value for money on the spending side.
That is what the value of fiat money rests on. It is a slender support, subject to rapid change. This is why currencies are tied to some kind of real asset, to provide assurance that the government is dealing with reality, will base its economic decisions on some portion of the assets its holds, and also won’t go around trying to expropriate the total resources of society via the printing press.
Lincoln used fiat currency in the form of greenbacks to help pay for the Civil War. And the value for that money was mandated by section 4 of the 14th Amendment: “The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.”
The CSA also issued fiat currency, and suffered price inflation of ~92x after increasing the money supply by ~20x during the war. They also lost the war. In the North, US greenbacks were initially issued as Demand Notes, redeemable for gold, but redemption was suspended, their value declined, and the government had to prop up value by promising to pay interest on them, effectively converting the cash into a form of certificate of deposit. These initial Demand Notes were retired after ~1 year, but many remained in private hands and eventually fetched a premium compared to the later US Notes. United States Notes were issued in 1862 and were not backed by gold, though the government simultaneously committed to paying interest on its debt and duties on imports in gold only, carefully limiting the scope of the fiat currency. At war’s end, the US Notes declined to roughly half their nominal value vs. gold, and that valuation was propped up largely because (a) the North won the war and (b) was able to maintain the overall credibility of its finances through stronger taxation, valuable exports, and promises to cease fiat money production after the war was over. Remaining US Notes were eventually reabsorbed back into the gold currency system by 1875.
In short, the CSA and US both issued fiat currency. The CSA’s was a disaster, but people never seem to talk about that. The US’s fiat worked ok, because it was acknowledged as being a temporary war expediency, and the gold standard was maintained for all other currency, plus gold was promised to be used to pay all outstanding debts and import duties.
Nowhere in the above do I see a good argument for transitioning an entire country’s currency to fiat on a permanent basis.
The US does not have a pure fiat currency because almost all money creation in the US occurs through the private side of the Fed.
Right, but MMT says we do have a fiat currency but its only some stubborn old rules about issuing bonds that are holding us back from unleashing it. What MMT proponents don’t realize is that those rules actually provide a real backing to our currency (value of assets held in the economy), and removing them would drastically alter the relationship between our currency and the political economy of the nation.
Yes, the New Deal did create not a pure fiat currency, but what you call an asset-based currency. And, MMT’s current fashion for disparaging borrowing by the sovereign seems dangerous to me and de-stabilizing. (I did scan your previously linked essay and found a lot I basically agree with.)
It should be noted that the gold standard after the Civil War proved to be an economic catastrophe for most of the U.S. population, triggering a very long depression in the midst of what should have been a period of very rapid economic growth due to technological progress and Western expansion.
I am not sure that extraction and upward distribution
is not at least a secondary function of money.
you are getting to the heart of things. I would rephrase that to say that the current social function of money via the empowerment of banking is to ensure that the flow of resources is directed to those who have the capacity to create money, i.e. the bankers themselves. (I’m paraphrasing Michael Hudson here.) But that’s a policy choice, not an inevitable outcome, possibly. Understanding fiat money may help make it possible to divert its function to one that serves a wider constituency.
Different Clue, I invite your fatal and lethal questions about MMT, politely raised or otherwise. Over at Naked Capitalism it’s truly dangerous to unleash the MMT flame wars but folks around here seem calmer and less committed to ideological frenzy. And:
What if non-State civilizations also created money
without then crafting a State?
Now you’re getting somewhere! I like to imagine a society of local-scale stewardships, each of which creates its own currency, taking responsibility for the needs of its neighborhood as well as some particular specialized functions (e.g. manufacturing, agriculture, specialized health care, etc.) that support trade with wider-ranging stewardships (and ordinary private interests) via both pairwise swap lines of the local currencies as well as in the background fiat currency of the local sovereign. Totally consistent with MMT; the state is uneccessary (but can be accomodated). Indeed one could say that unhinging money from the state might be the optimal route to, dare I say it, anarchist utopia?
Regarding zero taxation, it seems that it would eventually lead to debasement of the currency. MMT teaches that taxation gives money its value; citizens must scramble to get some to pay their taxes. Hence, no taxes, no value. But to return to the anarchist utopia, if money could be redeemed for essential services supplied by the issuer, e.g. food, shelter, health care, education, etc., taxation might indeed be optional, since the money would disappear in return for the services, to be recreated in payment to providers of services and materials.
Webstir, thanks for bringing the legal perspective into this. And thanks for the kind words on my MMT analysis! Apologies for broken link, shame on me. I’ve lately seen several references to a branch of MMT that originated in legal scholarship but I don’t have any hard cites for that. Would you recommend anything? I don’t disagree that money is a subset of property, another social construct. What I would say is that it’s useful to distinguish finite from unbounded. Land, materials, human effort, etc, are all finite. Money and other intangibles, not so. The path to creation of tangibles is basically independent of money, reliant on nature and human effort, although money is inserted throughout by social fiat. But money creation and destruction is entirely arbitrary and hence under much greater social control.
Hugh, is there more to your critique of MMT than the neoliberal leanings of its most prominent advocates? Do you question the fundamental premises, e.g. fiat money is unbounded, taxes don’t pay for spending, banks create deposits by lending, etc? Do you doubt that a job guarantee can be made to work in such a corrupt society? I ask in all sincerity: I’ve admired your insights since long before you were purged over at Naked Capitalism, and you’re a big part of why I’ve been lurking here for ages.
Likewise, Ian. Permit me to interject heartfelt appreciation to you as our host philosopher and moralist for keeping a focus on the spiritual void that seems to be swallowing Western civilization in our late neoliberal funk. Returning to MMT, agreed that there’s a cultlike aspect to the followers, but the rush that comes of realizing just how wide our policy options actually are may account for some of that. Are there theoretical/ideological specifics, distinct from the shortcomings of the followers, that lead you to dismiss MMT? I hate to see the baby go out with the bathwater.
What a delight to participate in such a discussion! Many, many thanks to all and especially our host!
@different clue
Sorry, I committed the same sin that I accused unnamed others of: getting confused and answering a question that nobody was asking. Off the top, I would give the same answer Stanley Dundee gave, that money would accumulate in excess of what society needed and, indeed, in excess of what people could produce. I think that’s eminently possible, but there’s no reason to assume that it’s the only thin possible.
We have an example of it in the effects of QE and TARP, which are instances of the Modern Monetary System creating money out of nothing. Values of financial assets exploded as players in finance were handed the money to bid them up, housing got the same treatment. The unfortunate side effect is that houses are “assets” (from the finance point of view), but are also things people need to survive, and the people that need them weren’t included in the QE money flow. That’s an example of money piling up in harmful places.
But the game that’s been played lately need not be the only possible game. I’m going to have to think about this a bit.
On just printing money and its losing value — is this somehow distinguished from the old definition of inflation of “too much money chasing too few goods”? In war time, production goes towards armaments and other goods tend to be in short supply. Without rationing or price controls, the price of goods will skyrocket (that is, the value of money will plummet). This will be true whether the money is paper or asset based. In any tale of rich refugees fleeing revolution, gold and diamonds similarly lose value in comparison to food, shelter, and transportation to safety. The asset will of course retain its value as an asset, and paper doesn’t retain value except for historical collectors. Finally, it would seem to be the government’s ability to enforce the value of money, by a number of means including taxation and ruling that creditors must accept money in repayment of debts.
On money without governments — wasn’t that what banknotes were? It was when government got into the FDIC business that money got as stable as we think of it now.
I think there are probably differences between MMT and financial theories that have come before, but I haven’t been able to understand why its advocates believe that if everybody understood that we don’t pay for government services with taxation, we’ll suddenly have job guarantees and free college. As Dick Cheney said, “Ronald Reagan proved that deficits don’t matter.” If anyone was in any doubt that the U.S. government can implement virtually any domestic program it wants, the $14 trillion it came up with virtually overnight in 2008 to make sure Lloyd Blankfein got his multi-million dollar bonus for doing a good job should have removed that doubt. When I said that no limits on spending just meant the elites could have more wars and lower taxes, I was told that no, MMT includes a job guarantee.
There appear to be two aspects to MMT. First, there’s a purely financial aspect about how money works. It strikes me as largely an academic issue of the sort that fuels academic careers. Those can produce clearer, more realistic theories or not. The other is a set of political objectives. But I can’t see the bridge between the two except as religious fervor, belief on one side and ritual on the other. I’d a lot rather see the fervor go more directly toward political goals. A job guarantee would be a very good thing, but that’s no reason not to go hard for higher minimum wage and job protections rigorously enforced, union support, and expansion of the government workforce for needed common services.
Here’s another money definition (better, attribute):
Money is a tool for social engineering.
Those who have the power to create it get most of the say in how it’s used. The present usage as class war cudgel (low wages, high rents, tolls for education, predatory finance and health care, electoral corruption, etc.) is hardly exhaustive (at least according to MMT) but maybe it’s the most typical usage.
Hat tip Bruce Wilder.
The rap on MMT is that it’s a neolib con to justify not taxing the rich. That doesn’t square with the emphasis its advocates placed on discrediting the “OMG, the deficit!” baloney used by DemsAndPubs to shut down talk of social spending. “Deficits don’t matter” Cheney gave that game away.
Funny how deficits don’t matter when gubmint money flows up. But when it flows down, Google
“mcconnell deficit” to see how deficits are suddenly “disturbing.” A sick, unfunny joke. And if the Dems were an actual party, they’d geat the Pubs over the head with it.
In the past, I have gone through the major assertions of MMT point by point and shown that they are either false or trivial. In this thread already I have pointed out that the MMT jobs guarantee is not what most people think a jobs guarantee is or ought to be, that the value of money does not come from where MMT says it does, that money creation occurs through the Fed not the US government so the US doesn’t have a real fiat currency, that MMT’s position on taxing the wealthy and corporations is far as in Koch brothers right wing. I have said many times that MMT was put together by people who know shit about the structure of theory, which is why it is so incoherent and why it can’t explain or rule out what we have now, MMT for the rich. There are other points I could go into but why bother?
Money is a medium for moving resources around a society in order to create the society we want to live in and maintain it. Leaving large amounts of money in unproductive places (with the rich, in corporate accounts, in their bubbles, etc.) subverts this purpose and opens up our society to great harm from it.
On just printing money and its losing value — is this somehow distinguished from the old definition of inflation of “too much money chasing too few goods”?
The Quantity Theory of Money has an unfortunate fascination for the human mind: there’s this basic notion, with a long history in economics, that money are the tokens of currency and you need a certain quantity to support a given “velocity” of transactions in goods and services, given the matrix of prices (aka the price level and the unit of account).
The “printing press” narrative is based on this very basic concept of the functions of money. The hoary idea that money is neutral in the long-run — a favorite of no less a personage than Krugman — is based on this idea of money as supplied in quantity. In the days of money backed by precious metal specie (coins), there was a certain sense to it, I suppose.
It is unfortunate that vulgar MMT rhetoric so often concedes the idea that money is a quantity, as when they argue that banks “create” money by means of mere journal entries. (Strictly speaking the banking system as a whole does expand credit, a point never really contested by mainstream economics, which merely asserts that an individual bank needs reserves and funding (e.g. deposits). Mainstream economics goes fatally wrong when it promotes the concept of loanable funds, the idea that money is not only a quantity but an almost viscous liquid encapsulating barter-exchange which banks borrow from savers and lend to borrowers — that’s absurd. (Also, a theory favored by Krugman among others.)
I think it is wrong to think about money as any kind of scarce commodity. It is terribly inefficient to use anything of intrinsic value as a money, because money is basically a score-keeping device. Money should be no more scarce than points awarded in a basketball game. The referees do not arrive at a basketball game with a bag full of points and then call the game if they run out. It is ridiculous. Just so with money.
As far as I know, money as a mechanism for score-keeping is good MMT.
I wish MMT advocates were more self-disciplined about sticking to the score-keeping story. When a bank gives a business credit, the bank is score-keeping — that’s all. If the score-keeping is reasonably accurate and honest, that’s to the good of the society. Governments and the general public ought to want to see banks kept honest in giving credit where credit is due. But, the public policy issue is not the “quantity” of money, but rather the accuracy and truthfulness of the credit.
To me, Bill Black, with his work on criminogenic environments and control frauds, goes to the core of what monetary policy ought to be about: not a ritual interest rate but the regulation of banking and the payments system to suppress fraud. That would be my idea of good MMT.
Money isn’t about currency tokens. The Fed and Treasury manage the supply of currency so that there is never any shortage of currency, per se. Having tokens in circulation is a relatively trivial problem for technicians and tokens for exchange are not a good way to think about money.
Money is about uncertainty and risk. Accumulating money in whatever form is about hedging and insuring risk and uncertainty.
Minsky is excellent on this point. Wynne Godley, I hear, was very good.
The current crop of MMT advocates seem a bit more at sea.
Hugh:
“Money is a medium for moving resources around a society in order to create the society we want to live in and maintain it.”
There we go.
Now, replace two simple words and see how it sounds.
“[Law] is the medium for [securing] resources around a society in order to create the society we want to live in and maintain.
Two sides of the same coin.
“money as a mechanism for score-keeping is good MMT”
Score keeping of what? If there is a score, what is the game? What are the rules? If deficits don’t matter in MMT, what does this have to say about the point of score keeping?
As for banking, I think plain vanilla banking, the kind that most people are familiar with and use, should be run as a public utility.
Hugh, thanks for your reply. That’s a solid critique. I will respectfully respond where I think I can add something useful.
the MMT jobs guarantee is not what most people think a jobs guarantee is or ought to be,
The idea of a job guarantee, which I attribute to MMT, is hugely threatening to the plutocracy, for whom low wages, a docile (frightened, insecure) populace, and of course a reserve army of the unemployed are key features of the neoliberal hegemony. Done well, the job guarantee seems like it could provide a living wage floor for wages, as well as subsidize valuable human services that are poorly served by private business, and, finally, offer the dignity of meaningful work to many whose lives are diminished by denial of a contribution to society. Designing and implementing a jobs guarantee that benefits the many and not the few is the hardest thing in the MMT playbook. I hardly think we should be limited to what’s been proposed by the professariat. Devil in the details, but well worth fighting for in my estimation.
that the value of money does not come from where MMT says it does, [i.e.] the value of money comes, not from taxation as per MMT, but from the belief of the people in it and their willingness to use it.
This one is very interesting. I tend to think we have a non-exclusive situation. Belief in the ability to exchange money for resources may indeed be rightfully founded, but unacknowledged, on the fundamental necessity of tax payments. But is it necessary to use coercive taxation to give value to money? I think not, and a system with numerous small scale sovereigns (stewardships, in my thinking) issuing their own currency, which is exchangable directly for basic human services, is quite dear to my heart.
that money creation occurs through the Fed not the US government so the US doesn’t have a real fiat currency,
MMT teaches that the Fed is branch of US government. I sometimes feel that US government is a branch of the Fed. Either way, neither the gov nor the fed is offering anything tangible to back the money, so it seems like fiat to me. The Fed is a a creature of law, and law can be changed. Again, we need to open up to the wide latitude of potential policy, not the impoverished menu of war, debt, and austerity currently on offer from our owners and rulers.
that MMT’s position on taxing the wealthy and corporations is far as in Koch brothers right wing.
Here, you are here conflating certain MMT personages with the entire theory, which seems a bit unfair. I will say in defense of the professariat that they are clinging to their places at the edge of the Overton window and they are trying a reach a wide audience that is thoroughly propagandized with serious untruth. Some MMT advocates, like myself, enthusiastically support aggressive taxation. Enormous concentrations of wealth are inherently anti-democratic and a healthy democracy uses taxation in part to protect itself from corruption by an excessively wealthy elite. Moreover, when those huge piles of wealth have been extracted by predation on the weak, with consequent expansion of poverty and destruction of a middle class, a healthy democracy would bring the law to bear against malefactors of great wealth.
MMT was put together by people who know shit about the structure of theory, which is why it is so incoherent and why it can’t explain or rule out what we have now, MMT for the rich.
Well I don’t know shit about the structure of theory, so guilty as charged. As for explaining why we have MMT for the rich, that’s a job for historians and analysts. Michael Hudson is very helpful in these matters. Philip Mirowski too. And then there’s annoying loudmouths like us.
Money is a medium for moving resources around a society in order to create the society we want to live in and maintain it. Leaving large amounts of money in unproductive places (with the rich, in corporate accounts, in their bubbles, etc.) subverts this purpose and opens up our society to great harm from it.
Nothing to argue with here! I would only say MMT helps us to understand how wide our latitude is for changing this, if we can get our hands on the levers of power, even at fairly small scales.
Thanks again, Hugh, for the stimulating discussion.
I think the Job Guarantee is a truly bad idea. Universal Basic Income is at least administratively possible, a Job Guarantee is misconceived on multiple levels, from the nature of employment to the purposes of state action to the dynamics of the macroeconomy. Focusing on the Job Guarantee is worse than focusing on the deficit as a navel-gazing guide to policy.
The answer to predatory finance is legal repression. Make finance small-scale, atomistic (many specialists), afraid, boring. A public utility, as Hugh says. Muster the political will or give up, but do not make a hobby out of furious fantasy in blog comments.
The present day Democratic Party is led and owned by the ClintoRats and the ObamaRats. They are co-conspirators with the Republicans to destroy our Social Security and privatize the money and revenue streams over to Wall Street.
Well . . . we would need power to press back most effectively. In the meantime, we could at least say that we didn’t have this deficit till exactly after the latest upper class tax cut. If Social Security had diddit, Social Security would have diddit a year ago or more.
Plus also, Social Security takes in more money from all us FICA payroll tax payers than it pays out to all the people now on Social Security. That means its building up a surplus, not running a deficit.
People could then decide whether it is more politically effective to accuse ‘Light-fingered Mitch’ of lying, or more effective to accuse ‘Kentucky Mitch’ of being too stupid to know how Medicare and Social Security works, and too stupid to know that “effect” comes after “cause”.
( And not just in the dictionary).
But this is not the time to prance about displaying superior knowledge about MMT and about “your taxes don’t fund Federal Spending and they never did.” People may well respond by saying
“if our FICA taxes don’t fund Social Security and never did, then what did our FICA taxes pay for?
Was it all a scam from the start?” That could put people in a mood to vote for a New Nihilazi Movement.
On the face of it, if the 90% had much of any influence on American politics, Mitch McConnell would be political toast today, mere hours after the assertion I quoted. Third rail of American politics and all that.
If counter-arguments were needed, academics and pundits would supply them, journalists would report on the motives of McConnell ‘s policy proposals and that would be that.
No one would dither over whether McConnell was a liar or stupid. Everyone would understand the answer to the question, cui bono? Everyone would understand that politics comes down to a struggle over the distribution of income and wealth and McConnell works for the rich.
But politics is confused because everyone in a position of prominence in politics, in the media and academia works for the rich. Many are the rich.
The merely middle class sponsor no think tanks, own no television networks, and belong to no membership organizations in which they could concert understanding and action. The people they read in the newspaper or watch on television for informed guidance — Rachel Maddow or Tom Friedman or Sean Hannity or Paul Krugman, say — are generally reckless, irresponsible ignoramuses. “You can’t fix stupid,” pontificated Friedman yesterday. He wasn’t talking about himself but he might as well have been. (He was explaining that he wasn’t really wrong about Mr Bone Saw’s programs of reform.)
I’m waiting for Trump to hire OJ to find the “real” killers of Khashoggi.
Just a reminder. The Social Security Trust Fund is an accounting fiction. Any surplus funds going to Social Security are kicked into general revenues and spent. The SSA gets some pieces of paper in exchange. They even pay some equally fictional interest although the SSA does not manage this fictional portfolio in such a way as to maximize that interest. The Trust Fund comes out of the 1983 bipartisan Social Security reform designed by Alan Greenspan (it’s what made him a made man) and signed into law by Ronald Reagan. Until the 2008 meltdown came along, it was the biggest con in human history.
Forget MMT for a moment. If the high end income caps on contributions had been removed, Social Security would remain solvent longer and FICA taxes on most workers could have been lower, i.e. the rich pay more, everyone else pays less. What happened of course was the opposite. The rich paid less into Social Security. Everyone else paid more. And not just more but in excess of what was needed to cover the outflows. As I said, this surplus went into general revenues. It was free money for the pols of both parties and came out of working people’s paychecks. Now at some point, in theory, when outflows exceed inflows and Social Security goes into deficit, money from general revenues would be needed to cover the shortfalls. This is terrible from the viewpoint of the PTB for two reasons. First, no more free money. Second, the rich pay most of the income taxes. So this would be money which they would be paying in which would not be coming back to them. This is why the retirement age has been pushed back and why there are so many attempts by both Democrats and Republicans to reduce benefits.
If the government had pledged back in 1983 or at any time since then to cover any shortfalls, that is all that would ever have been needed, no Trust Fund involved. If longer term refunding was required, there were always the income caps and general revenues first before revisiting payroll taxes.
Now with MMT, you could argue no FICA was ever needed, let alone a mythological Trust Fund. About all you would need taxes for would be to extinguish excessive wealth among the rich.
It’s a bit close to midterms to be talking about cutting popular programs when ever increasing numbers of the young rabble are becoming better informed.
If the Trust Fund itself is “mythical”, that means that all the other Treasury Debt Instruments are also “mythical” and trust itself is “mythical”. And if people are told that, trust itself will not even be mythical anymore. It will be gone, and we will be ready for Nihilazism.
Just because Greenspan designed the Great Reagan Rescue of 1983 as a deliberate long-range con does not mean that we should be expected to say “oh well, easy come easy go” , surrender, and agree to treat it that way. I regard my promised benefits, as promised by the “Trust Fund” as real.
And all the special Treasury Debt Instruments which the Social Security Administration holds could be redeemed in full with money to repay us pre-paying beneficiaries by the very same expedient of taxing the rich levels of society . . . at the very least clawback-taxing the entirety of their Bushobama tax cuts through the latest round of tax cuts, since those cuts were engineered to be “covered” by ex-post-facto embezzelment of all the FICA taxes paid into the Trust Fund.
If we are not going to be able to tax the rich under the rubric of Redeeming The Trust Fund ( promises made, promises pre-paid-for, promises kept), then we are certainly not going to be able to tax the rich under any other rubric or set of social conditions.
So what exactly is gained by treating the Trust Fund which we FICApaid into with real labor over real time as . . . “mythical” from the start and “mythical” all along?
The Trust Fund is mythical. The money is gone, spent. You, we, have been had. How Social Security payouts are handled in the future will have nothing to do with the Trust Fund. The Trust Fund at most represents a promise, but that promise could have been made without costing a dime.
Is the Trust Fund any more mythical than Treasury Bills and US Savings Bonds and etc.? If it is more mythical than those other things, what makes it more mythical?
The Social Security Trust Fund is money the government owes itself (for something it was going to do anyway in the future). It is an accounting fiction. It is mythical. T-bills and Savings Bonds are not money the government owes itself. They are straight debt instruments.
No. The SS Trust Fund holds actual debt instruments from the Dept. of Treasury, I believe.
It is NOT money the “government” owes “itself”. It is money the GENERAL BUDGET government owes the Social Security Administration. It represents money ( which represents monetized work-per-unit-time taxed from FICA-covered workers) taken aWAY from the FICA taxpayers and given to the GENERAL BUDGET government. If it is not repayed, then it will have been embezzeled from the FICA taxpayers who paid that separate money in a separate stream to a separate agency.
complaining that anything associated with money and finance is “mythical” is rank nonsense, because it is all fundamentally fictional. The bonds sold to the Social Security Trust fund are nothing more than a commitment device, something much needed in human political cooperation generally as well as this case particularly.
I understand why someone on the Right bent on opportunistically seizing the funds might wish to attack the commitment. Why Hugh does so is perhaps best left unexamined.
different clue, when you call it embezzlement, you are close to the truth. The Social Security Trust Fund was a stealth tax on ordinary Americans. The people who will “pay back” the Trust Fund in the future should be the rich, but this is precisely what the PTB wish to avoid. That leaves either cutting back on benefits/increasing the retirement age, foisting the repayment on to the next generation of American workers, or some combination of the two. We have already seen both rhetoric and moves in this direction. So if you take out a loan and manage to get the people who made you the loan to pay it off or modify the terms so that you pay back little or none of it, you have an idea of what is going on here.
I think that such a huge con as the Social Security Trust Fund was so easy to sell is precisely the confusion between real debt instruments and fake ones. It reminds me of all “innovative” financial products, the derivatives, the CDS, the CDOs, the CDOs squared and cubed, the synthetic CDOs which blew up the world financial system back in 2008. If you actually looked at them, none of them were legit, but before the meltdown, it was considered heresy to question them.
BTW here is something like the new Saudi Khashoggi story. Khashoggi entered the Saudi consulate where a 15 man Saudi kill squad happened to be loitering. For some unknown reason, a fistfight broke out between Khashoggi and the people trying to kill him. At this point, Khashoggi tripped and fell on a bone-saw which happened to be lying about, and he accidentally dismembered himself. The kill team being neat and civically responsible tried to clean up the mess as best they could. In the process, certain parts of Khashoggi, as in all them, were lost or misplaced. Such things happen.
Just read up on Becket-Henry, and wondering why the Press doesn’t have the power that the Medieval Church had to force MBS to kneel in public and take 100 strokes from reporters. Curious as to what kind of penance can be exacted.
Sad at our current level of tyrants who lack the political skills of a medieval asshole.
Since this is an open thread, I’ll be revealing, and have a thought about Becket, Henry II and the politics penance. Wikipedia:” then each of the 80 monks of Canterbury Cathedral gave the king three blows.” With a “rod” something between a switch and a staff, iow, thick.
This could have killed Henry.
So most to all of the strokes had to be symbolic and very light, and this pretty much had to be assumed going in. Don’t really want monks killing a king. But there certainly could have been just a couple asshole monks, and who knows what can happen when blood lust rises, so Henry was taking a huge chance here, putting his life and health in peasant hands.
But the monks didn’t hurt him.
I am a bottom up kinda Marxist, and am always interested in stories that show the power, cooperation, and complicity of the lower orders. Stuff was more democratic than we are usually told, and many of the stories about jerks at the top with power oppressin’ us are designed to make us feel powerless victims.
“Dr. Rasmus invites guests, Nick Brana and Alan Benjamin, to discuss the growing demand for a 3rd, independent political party, now supported by 67% of Americans according to a recent Gallup Poll. Nick Brana is the former national coordinator for the Bernie Sanders 2016 campaign’s liaison to the Democratic Party, formerly the electoral manager for the post-2016 ‘Our Revolution’ movement behind Sanders, and a prior director of Democrat campaigns for governor (McAuliff) and Kerry. Alan Benjamin is a former delegate to the San Francisco central labor council, AFLCIO, a union member and long time activist in Latino politics in California. Both guests are now active in the ‘movement for a People’s Party, a coalition of labor, community and progressive activists with 50,000 signed supporters.”
metamars:
It’s high time.
Lambert has been railing on this for a while now. The progressives won’t take the Corprocrats by storm because they own the machinery. Better to build one’s own machine.
And, an interesting excerpt from Mark Ames that, ahem, lines up neatly with a point I was making a while back:
“By a quirk of historical bad luck, the American Left has gone two generations without understanding finance, or even caring to understand. It was the hippies who decided half a century ago that finance was beneath them, so they happily ceded the entire field—finance, business, economics, money—otherwise known as “political power”—to the other side. Walking away from the finance struggle was like that hitchhiker handing the gun back to the Manson Family. There’s a great line from Charles Portis’s anti-hippie novel, “Dog of the South” that captures the Boomers’ self-righteous disdain for “figures”:
He would always say—boast, the way those people do—that he had no head for figures and couldn’t do things with his hands, slyly suggesting the presence of finer qualities.
That part about the hands—that would refer to the hippies’ other great failure, turning their backs on Labor, because Labor didn’t groove with the Hippies’ Culture War. So the Left finds itself, fifty years later, dealing with the consequences of all those years of ruinous neglect of finance and labor—the consequences being powerlessness and political impotence.”
@Webstir It’s not so cut and dried. I’ve written a lot about voting blocs which aren’t loyal to any political party (instead viewing them as vehicles) as being the critical organizational unit. (on openleft.com and firedoglake.com)* A progressive leaning voting bloc could and – I would argue – should engage the Democratic party with real, live candidates, even IF ONLY to show up the Democrats as corrupt, and thus to collapse support for them. A portion of that collapsed support will vote for the 3rd party.
It’s probably useful to view “taking over the Democratic party from below” as a prime tactic, with 3rd party votes by the voting bloc being Plan B, if they can’t prevail in primaries. However, the Democrats rigging their primary process EVEN MORE strongly suggests that the Plan B option will be triggered that much more often.
The Democrats – and probably the Republicans, also – have rigged their system by forcing candidates to sign pledges that they will support the eventual nominee. That is unfortunate, from a reformist point of view. However, it’s the voting blocs that should be calling the shots. Even if a progressive candidate is forced to support a bad Democrat, there’s absolutely no reason why the voting bloc, which had supported that same candidate during a primary, should be led, like sheep, into doing so, also.
unfortunately, I don’t see the diary where I laid out a dynamic scenario of voting blocs joining together (or not) depending on the degree of common platform with the same candidate, as well as the result of their collective decision making
Nancy Bordier was pursuing a systematic approach to online voting bloc formation and evolution, but apparently her project never went anywhere.
IMNSHO, it’s a sad commentary on the public and the ‘activist’ community that thinking in terms of voting blocs isn’t common, perceived wisdom. Instead, it’s NOT EVEN DISCUSSED. The lack of discussion of the Gilens and Page expose of our ‘democracy’ is not discussed – or organized around – either. In the case of elites, I think there is a real enforcement mechanism against this, that would show it’s heavy hand if self-censorship and/or ignorance by media figures failed.
I think the lack of discussion of voting blocs by elite media (or even alternative media) has more to do with the fact that they’re probably not smart enough to figure this out, on their own. But I’m basically guessing…. Furthermore, it’s not like political game theory is widely taught.
“Most books about power only deal with the societal formula of the few having power over the enormously larger powerless masses, and which is mistaken as the so-called “natural order of power.” But it is not well understood that this formula also requires social conditioning measures aimed at perpetuating the continuing depowerment of the powerless so that the powerful CAN have power over them. This in turn requires the societal suppression and secretizing of all knowledge about the superlative human powers known to exist in individuals of the human species, but which are socially forced into latency in most. It is broadly understood that power and secrecy go together, but the scope of the “web” of secrets surrounding the larger nature of human power(s) is surprising. As discussed in this Volume I of SECRETS OF POWER, empowerment is difficult if the larger panorama of societal power and depowerment are not more full understood.”
‘I don’t think Eschaton is a Democratic establishment blog. ‘
This long time Eschaton commenter agrees. The commenters definitely seem to be a lot more progressive than they used to be in, say, the Bush 43 era.
iconoclast:
I agree. There are more and more exceptions. But again, as stated above, there is well established bloc that will jump all over you if you don’t toe their Saint Hillary line. And it’s not limited to Eschaton by any means. For example, just last night I got jumped by a couple of them over at emptywheel on a bmaz post. That thread is produced below.
Webstir:
“The American press seems to normalize whatever this president and his foreign allies do … .”
Here, let me help you with that:
“The American press seems to normalize whatever [any] president and his foreign allies do … .”
There. That’s better.
J R in WV:
October 20, 2018 at 12:14 pm
“The American press seems to normalize whatever [any] Republican presidents and his their foreign allies do … .”
Can you even pretend the American Press normalized President Obama, or Secretary Clinton? Because if you attempt to claim that, we will all know that you are a Russian Troll, as your ‘nym indicates. Amazing claim to postulate that the Press normalized anything Obama ever did. His clothes were wrong, let alone his religion, his wife, his daughters, his citizenship, his race, all was perverted and anti-American. Or can you not remember 4 years ago?
When his Supreme Court nominee, required by the constitution, was rejected without a hearing!?!?!!!
Tracy Lynn
October 20, 2018 at 1:31 pm
Thank you for this.
errant aesthete
October 20, 2018 at 3:24 pm
Seconded.
Peacerme
October 21, 2018 at 9:25 am
Thirded.
Webstir
October 21, 2018 at 2:06 am
Oh for crying out loud. People here know me & you’ll find my handle over at Naked Capitalism, Ian Welsh, Eschaton, etc.
And yes, they normalized Saint Obama & Hillary. Libya? Drone attacks? Ignoring Yemen. Yes, all that happened on their watch. Get real. Stop being so tribal and use your brains.
Reply
Webstir
October 21, 2018 at 2:10 am
“His clothes were wrong, let alone his religion, his wife, his daughters, his citizenship, his race, all was perverted and anti-American.”
Oh, well then. You must be right. All those things definitely equate to killing innocent people with drones.
Good lord …
They’re everywhere, and they’re a cancer on progressivism.
Uhhmmm, Web, you went looking for a fight and found it. There’s a term for that.
After a fifty post interlude we’re back to the original question, which accentuates a point I made earlier. And again I suggest you are juggling apples, oranges and onions. What exactly have these three blogs done to earn your ire? As near as I can tell you aren’t blocked from posting there. Is it that those comment forums run to such a size your comments are lost in the haze? I am genuinely at loss as to what your point was one hundred comments ago.
There’s a lot to be said of we “hippies” turning our backs on traditionalisms and the consequences thereof. It has long been my contention we dropped the ball. We stopped The War. Our War. VietNam. But we didn’t stop War. And we left the machinations in place to become what we have become.
We were winning, as Hunter S Thompson put it, and then … we weren’t.
What’s rarely pointed out in relation to the Baby Boomers is that the promises of their childhoods were broken when they were young adults. Throughout the 50s, futurists and politicians promised better material lives and greater leisure. The Boomers responded by seeking a more inclusive society. Not all, of course. For every Bernie Sanders arrested for protesting de facto segregation, there were more Hillary Rodham Goldwater girls. But most protests were against the war, against the CIA both for its spying on domestic dissenting groups and its casual sauntering around the globe inciting coups, for environmental protection.
Meanwhile, in 1972, average wages hit their high point and then stagnated or started down. More family members got jobs to maintain standards of living. Wage workers were expected to work longer hours. Far from a Great Society of public goods, privatization and its ills advanced. FICA taxes doubled so that boomers would pay for their own eventual Social Security benefits as well as their parents’.
The generational warfare gang wants to sow the idea that the Boomers had it good and selfishly grabbed it at the next generation’s expense. It is more true that the “Greatest Generation” had it by far the best. If you want to talk about the sins of the generations and what caused them, you should include the way the whole framework of political and economic life shifted during the Boomers’ lives — the end of increasing pay as a share of increasing productivity, the end of pensions, the failure to enforce labor laws, the rulings against unionization, the increased cost of children’s education, the loss of a member of the family who could do the necessary unpaid labor of living . . . .
Back to Social Security . . . . still no. the Trust Fund is just as real as all the other “debt sold, debt re-owed with interest. And the Treasury Instruments it holds are just a Social Mythology Real as any other Treasury Instruments. The SSA cannot decide to not pay future beneficiaries, based on their at-that-time past FICA payment history, the benefits which are legally due them on its own, or with Presidential orders.
That is why the Catfood Conspirators know they have to work the Congress to buy new laws abolishing or shrinking the benefits and get the President to sign those new laws. That is why McConnell said so recently that “Entitlememt Programs” will have to be addressed in a bipartisan manner because the Republicans can’t do it alone. I believe he was sending secret messages to the Catfood Democrats offering to turn over one House of Congress to the Catfood Democrats in return for the Catfood Democrats collaborating with the Republicans to destroy Social Security and Medicare . . . because it would take Congress to transform those SS Surplus-held Treasury Instruments into the “worthless pieces of paper” which the upper class would like them to be but which the upper class is legally prevented from turning them into all on its own.
Now, if the Catfood Conspirators can get that done, then maybe I will join the Nihilazi Party. And if there isn’t one, maybe I will go start one.
Of course the Inner Governators never intended that those doubled FICA taxes should actually be used to pay the Boomer Beneficiaries when they reached retirement. The Greenspan plan was always right from the start to expand deficits and debt to un-repayability to extort the legal abolition of Social Security from the Congress and President at some future time. So of course the Greenspan plan was deliberate embezzelment.
Greenspan himself made that clearer than clear during the very early days of the Dubya administration when he pretended to warn Congress about the pretended-to-exist dangers of not-enough-Federal-debt. He was afraid that the General Budget FedGov would find itself so nearsly debt-low or debt-free by the time all us FICA payers lived long enough to be SS beneficiaries that carrying out step two of his plan, the abolish-Social-Security part, would not be possible because there would be not be a large enough Federal Debt to be able to extort that abolition with. That is how he easily conned a wanna-be-conned Congress into passing the Bush Tax Cuts.
And of course Catfood Obama conspired with Catfood McConnell and Catfood Boehner to make the Bush Tax Cuts permanent. Which makes them the Obama Tax Cuts now. And the reason Obama did that was to keep Step Two of the Greenspan Plan in play.
You know, I was thinking about saying something but realized — I just don’t care anymore.
As Ian has pointed out time and again, our momentum has us set to hit the wall at maximum velocity. I’ll continue to work my tail off to provide for the happiness and safety of my family when we hit. And I encourage all you urbanites to do the same.
None of this online stuff changes a thing. It’s all just a masturbatory exercise in ego stroking.
So, I’m deleting all the bookmarks and starting fresh.
My sister and lifelong best friend married boomer players who only associate with other boomer players. They’ve ‘achieved’ much status in this way – which in my observations involves circumventing meritocracy by gaming the system. It’s all been who they’ve known, while advertising (and rationalizing) an appearance of achievement.
They have six children between them. None of those six are on a path which will result in a status anywhere near what the parents have. After all six kids moved out to struggle with dead end careers and student debt, what did their parents do? Expand every possible vulgar display of their wealth, including their own homes. And the kids aren’t allowed back, not without significant ‘loser’ shaming.
What the hell kind of culture does one need to believe in to think this is culturally respectable behavior? (hint: they’re conservative evangelicals)
Webstir, I’d think twice. I’ve made comments which went in here (somebodies little website), and came out there (national TV). Not kidding. You never know who’s reading, whose people may be inspired by something one’s little old insignificant self may come up with.
I don’t actually think the anti-SS crew intended to double FICA. I think they thought they were on such a roll with tax cuts that they could say that the only way to save SS was to raise taxes, and everyone would say, “Well, then, we have to cut Social Security.” Instead, as we know, the response was “Well, then, raise FICA as necessary to save Social Security.” So instead of cutting SS immediately as they had hoped, they went to the longer range plan eventually to use the general government deficit as the excuse. Making SS “solvent” for another generation was not what Greenspan originally had in mind, but hey, when you can raise taxes on all the little laborers whose income is in wages while lowering the progressive income tax and still insist that deficits are bad, why not?
@Willy,
Personal example of American culture: some friends who both went to Ivy League schools and inherited some money live in a huge, architect built house and are driven (to hear him tell it) by a Tesla. So that defines Americans. Or wait, no. They’re Generation Xs. So maybe that defines Generation Xs. Anyway, why don’t your friends’ children be like Americans or like Generation Xs, whichever one applies. What culture would you say they have chosen?
I want the culture of my childhood, where the families I was surrounded with appeared healthy, happy and content with who they were and where they were living within their means. A bit less Ayn Rand, a bit more cowbell please.
I was promised a helicopter. Where’s my helicopter!?
I realized in 1975 when the union job setting chokers for a sawmill I got fresh out of the Army was gyppoed out to the highest bidder that I was not going to live the American Dream my father lived.
@ nihil, sorry, my sister and her best friend. Their kids appear to be in that emotional place where they are waiting for something good to happen because Jesus always blesses the faithful. Since most are females doing things like barista and yoga instructor I’d assume Jesus will be sending them a Mr. Moneyright sometime soon (ministers are nice but seriously…). I honestly don’t know their innermost beliefs though. Quite dangerous in a shaming/shunning culture to make controversial beliefs public, lest the parents send an exorcist.
Is your example a typical example of Boomer culture? Or is it a typical example of Conservative Evangelical culture?
If I offered some known-to-me counter-examples of non-Conservative non-Evangelical non-WellToDo boomers known to me personally, would you dismiss them as “not typical”?
I know a rural Oklahoma-bred boomer couple who are reasonably well-to-do (if one considers a regional manager and life coach couple well-to-d0) who are also quite progressive. But they’re a bit of an anomaly I think.
The irrationally selfish tribal lunacy of the conservative evangelical boomer Republican army (which sis and friend exemplify) went ineffectively countered by their far saner peers from their generation. Why were they unable to limit these ideas? How was the Clinton ‘alternative’ which was really not an alternative, that persuasive?
I’m still lost on why smarter people couldn’t counter all the batshit, which other generations, before and after, seemed to be generally more resistant to. Did the good boomers get complacent after being promised ever greater times by the futurists and politicians? Was it all the dope they smoked?
Also you are back to the boomers. And again you don’t look far enough back. I agree that we lost the use of our hands during the sixties and seventies and that there is a strong connections between that and the dropping of labor. This is one of my pet peeves. However what you ignore is the extensive brainwashing we received, in school and elsewhere, at the hands of the greatest and the silent that only losers and failures worked with their hands. The hippies to some extent tried to counter that with their emphasis on crafts but that could hardly compete with the skewing of career opportunities again on the part of the greatest and the silent towards white collar. By the by this trend seems to have accelerated in recent years. Your gens don’t seem to be doing much in the way of getting your hands dirty.
Did they? Most boomer males I knew could as youth, turn two old cars into one muscle car. Shop classes were popular. I knew an MBA who quit the LA financial rat race to move to rural Washington state and open a woodworking shop. And another in my own neighborhood used to be an electrical engineer. Yet another was a marketing manager who turned to landscape care, just like a mexican, his services popular in my hood.
But I do tend to agree that generations after the boomer are increasingly less capable with their hands, with the ‘practical education’ focus on medical, finance, real estate and of course tech. People I know in those fields are working longer hours with less hobby time.
Still, I ask who these brainwashers were and who specifically orchestrated all that. I pick on the conservative evangelicals because they appear to me, to have been the ground zero target, with the effects on their culture being egregiously opposed to their core scripture. Are we back to blaming the so-called economist elites? Usually there’s a money trail. What’s in it for them?
And again, why weren’t the boomers more resistant? Boiling frogs? Corrupting the lead lemming? Bad fads?
That generation started with so much promise and much hope heading towards a mutually cooperative future (at least in the west), and wound up redirected towards cyberpunk dystopia, without much in the way of resistance.
I’m still lost on why smarter people couldn’t counter all the batshit, which other generations, before and after, seemed to be generally more resistant to.
Were other generations more resistant to batshit? Well, the nation reelected Woodrow Wilson in 1916 because “he kept us out of war”, and then became almost hysterically pro-war within a year as the New York banks got worried about their loans to Britain. There have been race riots pretty much since the founding of the U.S. and all over the country, because smarter people couldn’t counter the batshit about blacks threatening whites. A lot of millennials were and still are big fans of Obama despite the massive upward shift of money to the top during his administration with his help.
“Why didn’t the good things of the past continue so they can be available to me” seems to be a perennial source of anger that can be directed into dividing people who need to work together.
I’m still lost on why smarter people couldn’t counter all the batshit, which other generations, before and after, seemed to be generally more resistant to.
Making due allowance for what nihil obstet wrote above, the rise of television and the decline of social affiliation (the bowling alone phenomenon).
If evangelicals seem so influential with regard to political culture, it is partly because evangelical church communities are among the few communities still active. The Catholics and Mainline Protestant denominations that formed a local ascendancy in many American places at mid-20th century are sadly depleted, the Catholics particularly shaken. Local business activism (boosterism) goes on, but is overshadowed nationally by business conglomeration: if local restaurants are franchises, local banks branches (and those branches are closing), local retail decimated by Amazon, supermarkets part of the Big 3 chains stocking the products of a few giants like Proctor & Gamble, the scope for boosterism is limited. And, then there are the craft and industrial unions, the Professional associations . . .
To act in concert politically against centralized power requires more than sharing emotional attitudes before a teevee screen. It requires social organization and commitment. It requires cognitive investments in thinking thru issues. And, I think some sense of solidarity with fellows.
Webstir
Thanks Ian.
I’d be interested in hearing people’s thoughts on the mind boggling popularity of establishment democrat blogs like Eschaton, Hullaballoo, and LGM. To steal Dave Niewert’s phrase, I sometimes “spy-hop” them, and have been known to do some progressive Webstirring. My question about Stephanie Kelton comes from one of those “stirs,” wherein, a commenter under the pseud “rhymes with mofo” stated, and I quote:
“Kelton’s a fraud and a handmaiden for TPTB, a grifter who is paid to assure the rich their taxes don’t have to go up, and who to blame for not making good things possible: the gummint. That’s not leftie, that’s pure Teabagger.”
Among other things, most of the commenters over think that to talk about “neoliberalism” is oh so “boring.”
Nearly everyone blames either Russia, or racism, for Hillary’s loss to Trump rather than her, oh so boring, neoliberal policies and war crimes.
Progressives handed the election to Trump.
And anyone who dare post progressive narratives is immediately labeled a “Trump helper elf.”
And the tragedy … there is a TON of traffic on those sites.
Am I missing something? What’s the allure? Why are so many of them so dead set against policies that could actually help people in this county?
Chiron
I hope I’m wrong but I don’t think Khashoggi’s death is the end of the line for MBS/Saudi Arabia support among the Anglo-American elites, KSA got away with 9/11 and blamed into Iran, heck, I’m betting that there is already a conspiracy theory blaming Khashoggi’s death on Iran.
About Kavanaugh, he should have been confronted fro being a Bush Republican who helped to pass the Patriot Act, not for being a drunken mick. This has been said before but you can overstate of how much the Democrats helped to rehabilitate the Neocons from the Bush Administration, look at the bizarre speatcle that was McCain’s funeral(s)!
NR
I don’t think Eschaton is a Democratic establishment blog. If you look at Atrios’s Twitter, he criticizes the party establishment quite a bit, as well as the media environment that has decided that the Democratic establishment is the only acceptable “left” politics in America.
Ten Bears
Dave Niewert and I have lived in the same neighborhoods down through the years, have met briefly a time or two, and I have long followed, have sourced in my own writing, his work. I would venture that as the internet persona for the Southern Poverty Law Center Dave is the “establishment democrat blog.”
Apples and oranges, I suppose. So too comparing individual efforts to a group. Digby’s masthead lists four bloggers, only two of whom post daily, and Dr Black’s daily one or two guests invariably post no more than open threads, while LG&M hosts better than a dozen writers, only half of whom post daily. Though the latter tend to centrist democrat not all are firmly in the Clinton Crowd, and I wouldn’t classify any of the three as “establishment”, or even mainstream.
I am surprised and wonder why you’ve targeted these for your ire, and not DKos, or Crooks and Liars. Those are your mind bogglingly popular establishment democrat blogs.
Ian Welsh
Dave Neiwart’s a genuinely good guy. When I first started at FDL he was the managing editor, and I was the second editor. We talked almost every day. Good man, and a real journalist.
I like Atrios’s views on most things. I like Digby personally, but often disagree with her.
I like LGM as much as they seem to like me. Take that as you will.
(Great name for a blog, though.)
Webstir
I’m not saying it’s Atrios. And, I’ve made exactly that argument to the commenters. It’s his virulent followers.
Webstir
And again, same with LGM generally. Eric is great and SEK used to be. Establishment dem followers … not so much. The progressives seem few and far in between.
Ten Bears
Now you’re comparing apples to onions. As we all here know commenters are easily “stirred up”, but few wrap their fingers around over there there’s so many – with comment threads running in the hundreds and occasionally over a thousand – it’s about like stirring water in a bucket.
Digby turned her comments off about when I did, six maybe eight years ago, as I did: because of the virulence of commenters (though occasional comments are posted to the mobile site).
I won’t follow a comment thread much beyond fifty posts, get’s too far off track.
GlassHammer
“What’s the allure?”- Webstir
Some answers are comforting and don’t require you to update prior held beliefs.
“Why are so many of them so dead set against policies that could actually help people in this county?” – Webstir
Few people tentatively accept things and it makes it hard to update what they know.
bruce wilder
There was a split in the Democratic Party after Obama’s election that gradually and quietly widened beneath the surface, so to speak, until Hillary Clinton’s primary campaign fight with Sanders brought it into the open.
The Democratic Party was moving away from its populist heritage for decades, but Obama and the Clintons very deliberately institutionalized the straddle: mobilize popular electoral support on the rhetoric of economic issues and the symbolism of civil rights, but deliver actual policy to the finance sector. Actual left policy and ideals have been an increasingly distant memory for decades!
If you actually opposed senseless war or favored economic benefits for the majority of the population (higher minimum wage, union organizing rights, Social Security, Medicare-for-All), your place in the Democratic Party is as a pawn, owned and destined to sacrificed, in order to put in office the evil of the so-called lesser evil.
Hillary Clinton’s candidacy in 2016 was the culmination of a long process of evolution in the straddle, in which the increasingly cynical Democratic Party establishment furthered its political strategy of harvesting votes for the Party’s heritage and selling them to banksters and the plutocracy who want policy favorable to their interest.
The partisan combat of an election campaign requires a lot of propaganda to mobilize people into the opposing camps behind the candidates. That means helping people rationalize and build denial. The Democratic straddle is particularly demanding — really the Republican straddle is a big strain as well as the greedy try to lead the religious and patriotic — as you, a leftish Democrat, have to argue yourself into supporting a candidate who is committed to screwing you on every damn issue and wants not to win too much power (for fear of having to deliver something for voters at the expense of donors).
Of course, LGM is a comment cesspool. Scott Lemieux. Hello? Reading his political arguments for the straddle invites necrosis of the brain.
I like Atrios. A lot. But, on some level, I know he is packing peanuts for David Brock.
digby at Hullabaloo was once one of my favorite voices, but I do not even look now.
The cognitive dissonance of the straddle is really hard on the thinking processes of anyone identified with the Democratic Party. If you can say, “Hillary Clinton is a monster” from a left perspective, you are probably able to see her candidacy plainly. But if you have to think her family Foundation was a charity dedicated to doing good work, that Hillary has always been a fighter for children and women’s rights, that she is a sober realist in foreign policy who deliberately avoids wars, that she favors campaign finance reform from a high ethical standard, and so on. Possibly today you think the Russkies conspired with the Donald to take it away from her and as a consequence the rules-based international order and the economic ideal of free trade is in danger. Perhaps you think the 35 year old grievance of a privileged self-involved woman against a drunk 17 year old should be dispositive with regard to a Supreme Court nominee (because no one wants to oppose his jurisprudence or even his amoral partisanship on the merits).
It takes a lot of abusive bullying and absurd rationalization to keep the straddle going in either Party. That propaganda is a design feature of politics in a plutocracy.
bruce wilder
correction: harvesting votes from the Party’s heritage
DMC
Still look at Atrios from time to time though I skip the comments. It was finally Eric “world’s biggest scissor-bill who won’t shut up about labor history” Loomis that drove me away from LGM, though I stopped reading Lemieux’s blue doggerel about a year before(is he bucking for Friedman’s job?). Been a while since it seemed like Digby had anything to say, but since the last election, I dropped a lot of blogs that just seemed to engage in purely partisan blither. I just don’t have the patience for it anymore. They seemed like lefties but it turned out they were just Democrats. It’s like a bumper sticker I saw the other day “I’m proud to be everything a liberal hates” and I just thought “A genuine Leftist?”.
Hugh
Scratch the surface of the primary theorists of Modern Monetary Theory and you find a lot that is neoliberal/neoclassical. This is unsurprising. Most of them or their mentors were trained in neoclassical economics. There were certain issues they had beefs with traditional economics on, but there was never a fundamental rethink and so much of the substrate of neoclassical economics remains. (And neoclassical economics with a few libertarian flourishes is the essence of neoliberalism)
The first time this really hit me was with the jobs guarantee. The MMTers saw this as a place to dump excess workers until the private sector had need of them. Originally, they saw these jobs as temporary, minimum wage, make work affairs. And they didn’t much think beyond this until people like me started criticizing them for it. We got them to add some verbiage about a living wage. But they never moved their view from market-centric to person-centered. A real jobs guarantee would offer meaningful ongoing work, chance for advancement, and a corresponding living wage. However, if a JG offered this level of opportunity and security, why would anyone want to abandon it for the vagaries of the markets of the private sector? In other words, a real jobs guarantee that put workers first would completely undercut the MMT market-centric purpose for one.
Then there is the MMT stance on taxing the wealthy and corporations. Randy Wray says don’t bother trying to tax the rich because they hide their wealth too well. As for corporations, they “earned” their profits and should be allowed to keep them. For MMTers every problem can be solved by the government simply printing more money. The distribution of that money doesn’t matter to them. That 95% of the money creation in the US occurs through the regional Feds, that is the private side of the Fed system doesn’t register with them. They also ignore bubbles. For them, the only constraint on money creation is full employment. Kelton’s remarks are fully in keeping with MMT and that is just one of many reasons to reject MMT.
Webstir
Thanks Hugh,
Food for thought.
To Kelton’s credit, she does argue for redistributive policies in regard to MMT. For example, you can achieve the same purposes that a massive tax cut for the rich achieves by, for example, slashing student debt, or investing in infrastructure.
I think she does have a point there.
Ian Welsh
Yeah, I don’t like MMT and never have. It has some important insights, but the edifice is deeply flawed.
You can’t tell that to the supporters though, it seems like a free lunch and people really, really buy in.
Hugh
Reaction to Khashoggi’s state-sponsored murder should be a no-brainer. But we have a President who is an idiot and a coward. So he will only take the actions he is forced to take. I had to laugh at the threats of retaliation the Saudis are putting out against any US sanctions. Like pretty much every other oil producer on the planet, the KSA needs to pump as much oil as possible to keep from imploding. As for the KSA shifting to Russia as an arms supplier, this has two major problems. Most of their advanced weapons systems are American. They need the US for spare parts, and it would take years for them to switch over their inventory. We’re talking tens and tens of billions of dollars and ending up with systems that are inferior to what they could have gotten from the US. This also ignores the political realities. Russia is currently backing the Shias in the Middle East, the people that MBS is waging a jihad against, and this includes the Saudis’ arch-nemesis Iran.
Webstir
Bruce:
Yeah, we seem to be traveling the same path. I’m so over those that seem all too willing to rationalize away the shortcomings of the Dem party. And I’ve used exactly the same term in relation to Atrios v. his commenters — cognitive dissonance. You’re just left scratching your head going … “Did you actually read what he’s saying?” And yeah, he just posted media matters as proof of one his arguments just the other day.
DMC:
Amen on Lemieux. As to Loomis, I’m interested in Labor history, but I got the feeling he just uses the site as a notepad for his books in that respect. Being a treehugger, I do like his environmental work. About the only redeeming part of the blog since SEK died.
different clue
Over at Naked Capitalism it is too the point where if you disrespect MMT snidely enough, you may become persecuted all the way off access to commenting. I remember referring to it sometimes as Magical Monetary Thinking. I once asked if a Trillion MMT Dollars could bring back the Passenger Pigeon. And so forth.
It might be a worthwhile project for non-banned commenters to every-rare-now-and-then raise fatal and lethal questions about MMT in the politest possible way and see what happens.
The “Free-lunch” aspect is that the Magical Monetary Thinkers think they can dodge and evade the whole question of Social Class Combat and Social Class WarFighting. Just take control of the Monetary Keyboards and keystroke some Magic Money into existence.
Hugh
I lost interest in most of the blogs mentioned here. Ian’s is the one site I know of which tolerates progressives, that is the non-Democratic, non-liberal Left.
I find my comedy where I can. A couple of weeks ago, a relation told me I was responsible for Kavanaugh’s confirmation and Donald Trump because I had not voted for Hillary Clinton. We totally talked pass each other. I pointed out that no one owns my vote, and if the Democrats had wanted my vote, they would have nominated somebody who represented what I think is important and who was willing to fight for it. Instead they found the worst, most pro-corporate, elitist they could and tried to shove her down my throat in a rigged primary process. Still my fault as far as my relation was concerned. I was surprised but I think this is still the view of many Democrats. The lesser of two evils. Vote for the Democrat because the Republican is worse.
Webstir
different clue:
“Over at Naked Capitalism it is too the point where if you disrespect MMT snidely enough, you may become persecuted all the way off access to commenting.”
True. I’ve seen it happen. I pretty much split time between here and there. Although, I do most of my commenting here simply because of the variety of points of view. It can get pretty tribal over there, too.
Any theories on why Ian attracts such an eclectic group?
As to MMT specifically, I agree with most of the comments here. It’s plain that our neoclassical approach is a farce. But at the same time, I don’t think MMT has all the answers as some would have you believe. And to say that it’s just printing money into existence is disingenuous. It definitely seems like a better way of managing growth through deficit adjustment than the current neoclassical myth.
Herman
I sometimes read LGM for Loomis’ posts on labor history but Scott Lemieux and the rest are pretty bad. The comments are even worse. If you even suggest that Hillary Clinton ran a bad campaign you will get piled on. I have noticed that partisan Democrats are more defensive about their politicians than Republicans. I have many Republican friends and relatives and when McCain and Romney lost they had no problem recognizing that they were bad candidates and ran bad campaigns. Partisan Democrats on the other hand simply refuse to admit that Clinton was a bad candidate.
I suspect that many of the people at LGM and other partisan Democrat blogs are the kind of “front row kids” who are not used to people criticizing them. They were always the “A” students and they get flustered when people disagree with them. Getting beat by a boorish reality TV star like Donald Trump was the ultimate embarrassment for this group. They were so convinced of their moral and intellectual superiority to The Donald and his Deplorables that their loss shattered their worldview. In order to repair this worldview they have to fall back on Russia Russia Russia or on racism as the only factor in explaining why people voted for Trump. This way they can both shift blame and maintain their sense of moral superiority. Nothing is their fault and their opponents have no legitimate grievances about things like the economy instead it is all about white male privilege.
Hugh
Webstir, I have no problem with a trillion dollars to pay off student debt. But you have to ask where does the money go after that. Most of it ends up in the hands of the rich and only increases wealth inequality. What you want are high taxes on the rich so that trillion dollar upward transfer is extinguished. Money is about moving things around a society. If money always goes upward, its primary function is subverted.
Ché Pasa
Stopped reading Atrios about the time of the crash leading to the Big Recession. He was supposed to be something of an economics perfesser, but he essentially had nothing to say about what was going on and what had led up to it, I assume to protect his field virginity. His commenters had long since gone into Dali-land, and if you enjoyed the surreality of it all, that was the place to hang out.
Digby became a repetitive Democratic Party PR enterprise with literally nothing to say beyond the Party Line, and when she terminated her comments — not because they were particularly vicious but because too many commenters defied or just questioned the Narrative being sold — there was nothing (much) of interest. She’s still a good writer. With nothing (much) to say.
NC strikes me as a Republican/Oligarch Party cut out. Kind of like dKos (at least the front page). They are “progressive” in much the same way the early Progressives were. Their main objective was to ensure the populist left never achieved power sufficient to overcome the power of money. They were largely successful.
So far, to his credit, Ian doesn’t seem to have or impose a Party Line of any kind.
bruce wilder
If money always goes upward, its primary function is subverted.
hmmm. I am not sure that extraction and upward distribution is not at least a secondary function of money. Money, if we are to believe the chartalists, was invented to facilitate the state’s emergence in the practice of fiscal separation, i.e. the distinctions among public finance and public purchase and public provision that give rise to the institutions of public and private debt, payment and banking. Of course, extraction in obligations of service and provision in kind were institutionalized with only minimal reference to money as specie in the local autarkies of subsistence feudalism, but the point is that more sophisticated money and finance facilitated more sophisticated and elaborate social hierarchies.
bruce wilder
Re: MMT at NC: A post currently headlined has this passage:
Yves calls this guest post “meaty”.
I laughed.
different clue
Money!! The selectively permeable membrane of the State? What if non-State civilizations also created money without then crafting a State?
I don’t know the history of the Phoenician coastal trading cities well enough to know if they were Genuine City-States or whether they were coastal trading cities which never felt they needed a State structure so never bothered to evolve one. If indeed the second choice is so, and yet they evolved money, then what was money for in their civilization? What purpose was it serving that would serve no Chartalism-invoked need?
different clue
@Hugh,
I suppose if someone were to try blaming me for Kavanaugh because I didnt’ vote for the Evil Clinton, I would say something like: ” I wanted Sanders to be my Democratic nominee. But the Democrats wouldn’t let me have my Sanders, so I wouldn’t let them have their Clinton. Sanders might have won, but they nominated their Clinton, and the rest is history. Nominations have consequences.”
Especially that last sentence . . . “Nominations have consequences.”
About the Digby blog, I remember she time-outed the comments a couple years before final closure, because of vitriol. But I don’t remember any major vitriol in the last few months before closing. What I remember is she brought a semi-pro little Democratic Operative named David Atkins onto her blog, and she worked with David Atkins to introduce various kinds of strangling, ghosting, stealth retro-erasing of comments, stealth banning, etc. She did this strictly because
disgruntled former Democrats weren’t eating the dog food anymore, and were telling all their fellow dogs just how bad the dogfood really was, and why.
Long before that, I remember reading a Digby entry at some kind of “wise clever party operatives” blog whose name I forget . . . writing about how “self-indulgent identity-left challenges to the Democratic party could not be tolerated or permitted”. So Digby’s true essence was made known to some a while before the erasure of comments, which by the way included erasure and destruction of all the archives and archived comments.
Digby, Clinton and Salon all deserve eachother.
Ten Bears
Re. David Atkins, at the time I commented “lose the agent provocateur.”
I have pointed out before the Russians only perfected what ‘Muirkkkans started.
Duck1
Eschaton commentariat are an ecosystem, or more like a compost heap. One imagines them in their wheel chairs clutching oxygen bottles as they battle the great russian menace, Trumpism. Like Hillary, a bunch of closet Birchers. More and more they reject the guidance of Duncan, who is to their left it seems. Any new name that tries to comment is virulently opposed and most give up. A sad situation.
Willy
I thought part of the progressive game was always wanting to debate towards a better way, while all the other tribes ‘just know it’ already.
Is there an online anywhere that places these people on a liberal-progressive spectrum chart (among other things), or gives a clear and pithy description of their apparent (and maybe real, where they get their funding, etc…) positions? Should there be?
Peter
@Hugh
You should know you are talking nonsense. The investors who supply student loans may add to the cost of education but are not the cause of the high cost or debt. Rising tuition, books and R&B are driving higher education costs. Taking away their interest gains with taxes would end investors loaning this money. Even the government makes a hefty profit from their student loans. The problem is that too many students choose to study and get degrees in areas that don’t pay very well and are not in demand. We have free tuition here, paid for by our lottery, but my son still had a fairly large debt when he graduated. He chose a high demand/pay field and is very good at what he does. At 30 he is earning a six figure salary and had no trouble paying his debts.
Webstir
bruce:
The word money and property are virtually synonymous. Money simply being a subset of property. If you understand what property is, you understand what money is. Trouble is, very few understand what property is. Property is simply a social contract of various rights and duties. Meaning, it’s whatever we all agree it is.
That our constitution enshrines property by commanding just compensation if taken by the government is simply the shape of the duties and obligations we call capitalism (again, synonymous with property). You just described that “particular” system, not money.
different clue:
Re money, see above. But yes, there are no duties without the force of the state to penalize those who don’t obey. And, it’s semantic to wonder whether the Phoenician cities were states or not. If they formed a system of rights and duties, of which power could consistently be brought to bear if said duties were not honored — then they were states. Being traders engaged in commerce, I suspect that’s the case. Like I said a couple of posts back — without that power all bets are off and things rapidly devolve into the law of the wild west. How big is your gun, and can you pull it after than the person screwing you over?
Duck1:
Nailed it.
Webstir
Peter:
“The problem is that too many students choose to study and get degrees in areas that don’t pay very well and are not in demand. “
That’s “the problem,” is it?
No. The problem is simply this, we’ve stopped valuing education for it’s own sake.
That. Is. The. Problem.
different clue
@Webstir,
Question: why might Ian Welsh be attracting a mixed lot of readers and commenters?
Possible suggestion: his posts do not seem to offer very much comfort or validation to psycho-tribally identified people. People who come here have to accept that they may not have their fondest belief systems or their personal identity therewith praised, supported and validated. So they stay for the challenge and maybe the learning.
bruce wilder
The word money and property are virtually synonymous. Money simply being a subset of property.
Yeah, no, not virtually synonymous; the difference is critical and neither is a “subset” of the other. Money and property are complements, I suppose you could say, and the distinction between money and property and the selling and leveraging of property with and in terms of money is at the core of capitalism as a system of organizing economic activity. Property, as you say, is the bundling and attachment of political power and rights to legal ownership and it is the exercise of that political power to organize and command and bargain thru the medium (and by the calculated accounting of) money and finance that drives capitalism. So, different and distinct, but entangled in complex ways.
I agree that both money and property are social constructs. In that sense, both are “virtual” — parts of a socially-constructed, institutionalized fiction papering over our uncertainty and ignorance about the “real” world. I would not leap to “it’s whatever we all agree it is” for fear of implying that “whatever . . . it is” is not deeply conditional on and adaptive to what we know and learn about reality. I think that’s the hard part in understanding money: the relation of money to pervasive uncertainty.
Money, I like to say, is a language for writing fictions. Politically, part of the struggle is to find ways to favor “true stories” over fraud and fantasy.
Hugh
“more sophisticated money and finance facilitated more sophisticated and elaborate social hierarchies”
The chartalists are, of course, wrong. It is rather the other way around. Economists have the absurd idea that first there was some strange beast called the economy and it invented society to serve it. Or that one of its bastard offspring is the state which slouches through history after it.
There have been many different kinds of state throughout history. They do not exist independently of the people who run them and almost always these people have run them to enrich themselves. Most of these states have nothing to teach us about anything. But some do. I draw a lot from the Greek notion of the polis and Aristotle’s analysis of it. Doesn’t mean I would want to live in one of those Greek city-states, but the ideas that the polis is the community of the people, ethics is about being a good citizen of the polis, and ethics governs both political and economic activity are essential to fix what is broken in our country.
Hugh
Peter, we do not exist to serve the economy. The economy exists to serve us. Universities should not exist to be overpriced trade schools, but to enrich the quality of our lives, form us as good citizens, and only then to train for industry.
Tuition costs keep going up because universities are being run as corporations, and because the rich who have all the money continue to defund them by not paying taxes and having their bought and paid for politicians steer money away from them.
Education should not be some profit source for investors except in an end stage kleptocracy.
Ten Bears
You told us just last month, Pieter, that you live in Iowa. This is the 1st I’ve heard Iowa has free tuition.
Willy
I believe New Mexico has a program for needy students.
He chose a high demand/pay field and is very good at what he does.
Russian troll farms will only pay as long Putin’s around. Whith meritocracy dying, things depend on one’s relationship with the boss. OTOH, if he’s in business for himself, my hat’s off to him.
Webstir
Well, we all have our definitions. I’m sharing the definition lawyers use. Which is useful, as, no matter how you dice it — it’s all law. Which, again, is simply a social construct of agreed upon norms.
From there, it’s a chicken and the egg problem. Which came first, property or money? I’ll submit that the first time someone said “mine,” { https://www.youtube.com/watch?v=p-3e0EkvIEM } and used force to substantiate the claim, property came into being. Money evolved later to help with the portability problem.
Thus, a subset of property law.
And law schools have teaching, not incorrectly, that ALL law began with property law.
I’d be interested in where how you came to form your definition, because I’m simply reflecting nearly a thousand years of common law jurisprudence.
The definitions economists bandy about only serve to reinforce the legitimacy of their profession. They don’t know what they’re talking about.
Webstir
Willy:
“Whith meritocracy dying, things depend on one’s relationship with the boss.”
As Lambert over at NC says, “If your business depends on a platform, you don’t have a business.”
To paraphrase, “If your business depends on a strongman, you don’t have a business.”
Webstir
On the money topic, NC has a great article up by Nick Hanauer:
https://www.nakedcapitalism.com/2018/10/destroy-neoliberalism-kill-homo-economicus.html
robotpliers
RE: MMT, its central problem is the advocacy of fiat money creation, with taxes being used to “drain” money from the private sector and control inflation. They think the closing of the gold window put us on a pure fiat currency, and they look to the post-Reagan era of top-down control, big deficits, and wage/inflation suppression as illustrative of how the government and economy should work, but then promise to be better via the job guarantee and more generous social spending. Basically, take the reactionary Reaganite framework and direct spending through it to some New Deal-ish programs, all the while trying not to let a fiat currency explode. Bad idea.
I wrote a post a little while back that picked at some common MMT arguments. Call it the negative case for an anti-MMT. I plan to eventually right the inverse, building up an actual positive case for how to run a political economy. That’s going to be much harder though.
https://robotpliers.wordpress.com/2018/07/12/poking-at-mmt/
Peter
@Willy
NM has free tuition for all resident HS grads, my son got it for 5 years including one year studing in Japan. He speaks 5 languages including Chinese and writes computer languages but no Russian.
Mojave Wolf
Reposting this here since it looks like the other thread may be closed:
Leftover from preceeding thread before catching up (if I catch up) on this one: (sorry, my power was out all weekend due to lightning strikes, not that I could even get home Friday due to flash flooding and wound up sleeping in my car both Friday and Saturday nights, which I realize sounds trivial when you look at the Hurricane Michael stuff, but, that’s why I’m way behind)
@Webstir — re: RC’s legal knowledge — he’s previously said he worked on the Innocence Project and graduated from Cardozo, iirc. I realize from my own sitch that “decades ago background” & “current working knowledge/memory of what you used to know” are NOT the same thing (that’s why I qualify or am general about so much of what I say; I don’t know what all the changes are, and don’t remember definitively a lot of what I used to know, and I’m not even gonna try w/stuff like “jurisdictional differences on term limits” since I never knew all of those) but my memory can be highly selective based on “level of interest” so there’s a very good chance he remembers (or has kept up with) stuff a lot better than me. And honestly even if someone’s not/never been a lawyer doesn’t automatically mean they can’t be up on this stuff; I betcha half the paralegals and legal secretaries know this stuff better than half the people they work for, laypeople in unrelated fields could be afficianados who keep up w/it out of greater interest than people like me who fell into it, etc.
Not meaning to diss you there, you’v made a lot of good points in these threads.
@RC — I have a livejournal (https://mojave-wolf.livejournal.com/) I barely use anymore & a twitter account (@ThisWickedWorld) if you want to get in touch w/me via either of those. Otherwise I’ll try to find some way to get you an email addy w/out posting it for all the world to see & spam.
@Metamars — agreed w/the need for a twitter alternative, for similar reasons. I was part of a discussion a few weeks ago about whether there was any chance of forcing them to be considered a semi-public commons, or sort of a “for profit public square”, where they were partly subject to general free speech standards despite being a private company. I think you could make a case for this, but since it’s a long uncertain (and possibly losing) road to make that case, an alternative place to go would be nice (and might serve to keep them from becoming overly draconian)
& yah, we had different assessments of Ford’s credibility. While agreeing w/you & RC that she could have been coached, locked and loaded, I don’t think that is what happened here. & Kavanaugh’s efforts to defend himself served to hang him in my eyes, but, well, again, we came to different conclusions there. I will (strongly) disagree w/some here about the viability of prosecuting him now. Technically, could you? Yah. Should you? No. Are you likely to win? That will depend 100% on the makeup & biases of the jury pool, most likely, assuming at least basic competency on both sides from the attorney. Always a factor but way too much so here.
I would say at least 1/3 of my female friends & acquaintances from back in the day had something in that ballpark or worse happen to them back then; I don’t think a lot of guys realize just how bad some other guys are. (one thing I know from having a lot of girl friends –as opposed to girlfriends — back then, many guys behaved very differently toward women away from the crowds; most are better but some are scarily worse, and a lot of basically decent people will go along w/awful stuff if they think it’s what they are “supposed” to do or if some other guys start doing it and they don’t want to be accused of being unmanly or insufficiently supportive of their brethren or something; I am unsure to what extent this is better or worse or neither now)
Hugh
There is no particular problem with having a fiat currency. The value of money comes, not from taxation as per MMT, but from the belief of the people in it and their willingness to use it. Government has a secondary role in establishing value for money on the spending side.
Lincoln used fiat currency in the form of greenbacks to help pay for the Civil War. And the value for that money was mandated by section 4 of the 14th Amendment: “The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.”
The US does not have a pure fiat currency because almost all money creation in the US occurs through the private side of the Fed.
Stanley Dundee
Whoa, great comment thread! Sorry to be late. I will try to return in defense of MMT but at least for now please consider, as I believe Hugh originally taught me (although G. Simmel gets the academic credit): money is a claim on the resources of society (of which property is a subset but by no means exhaustive). Don’t confuse money with anything real. It’s entirely a social construct.
Stanley Dundee
Nice to hear some slagging on MMT around here. Happy to step into the fray.
I urge you to try to separate the MMT model (theory, if you will) from the people who invented and promote it. What MMT teaches that seems most important to my thinking is the full range of policy space in which we can operate with a fiat currency. It’s a very wide space. All that guff about we can’t afford things comes down to real resources not money. If we have the will and the capacity to do something, money is no object, indeed it’s a useful means.
Michael Hudson is the guide to choose for moving over to political economy from the technicalities of money. It’s bankers that most need dealing with. Their undemocratically granted authority to create money in the forms of loans and deposits basically gives them command over any of society’s resources available for sale. And neoliberalism strives to ensure that everything in society is for sale! Throw in compound interest you get rule by bankers: debt enslavement. Sound familiar?
Imagine we had democratically elected committees that existed only to award grants to local organizations for hiring (job guarantee here) and raw materials, to serve local needs. Preschools. Elder care. Community kitchen. Landscape services. Home repair. Clinics. Transportation. We could make it quite festive, and give out awards at a huge annual party to local services that really stood out. MMT makes that possible, without necessarily raising taxes. But of course taxes should be raised on our wealthier tiers.
The reluctance to tax that you hear from some prominent MMT advocates is a regrettable policy but it doesn’t come from MMT. It is part of the very wide policy space, but there are better places. Tax as a tool for redistribution (as well as moderation of demand) needs to come back big time. Perfect tool for correcting imbalances of income and especially wealth distribution. MMT is indifferent but we are not.
Please forgive my self-promotion. I invite all of you who despise MMT (and everyone else, too) to take a crack at my essay Getting Money Right and pound away wherever you find I’m wrong. Many thanks!
different clue
@Stanley Dundee,
Question from a totally untrained layman . . . In the “modeled-or-explained-reality” side of MMT world, if we did pure de novo issuance of federal money for first-instance federal spending, and we mandated zero federal taxation, what would happen as we kept issuing more de novo money for ongoing first-instance spending ( either unique project like big power dams or ongoing periodic payments for spending by the recipient of those payments . . . like Social Security) ?
What would happen sooner and then later? Would there be an End Stage / End Game for the issued money as its amount kept rising? If so, what would that End Stage/ End Game be? Assuming no federal taxation ever? EVER?
realitychecker
@ Mojave Wolf
Never dealt with a Livejournal before, tried to open an account at your address, would not go through. I am not on Twitter, and don’t care to be.
Perhaps Ian would care to help? If so, I hereby authorize him to email you my email address on file at this website, or, alternatively, to answer an inquiring email from you to him by providing you with my email address.
Unless you have another idea for getting in touch.
BTW, I interned with the co-founder of the Innocence Project (Barry Scheck, who also got OJ off by handling the DNA part of the case, both after our association), then worked directly for the judges of the second highest appeals court in New York, a very special court with a hot bench and interests of justice jurisdiction, where every opinion gets published, and I wrote the opinions on most of my cases. My job was to write a comprehensive report for the judges I selected to be on my cases, refining the relevant facts and evaluating all the arguments by all the lawyers. (Just ask Webstir to explain to you what “interests of justice jurisdiction” is, and how rare and special such a court is-I’m sure he’ll be happy to display his extensive and thorough legal knowledge lololol.
Hope to speak with you soon, amigo. I’m sure it will be interesting. 🙂
Ian – passed on.
Webstir
Stanley Dundee:
And a sociologist steps into the definition of money fray. Well then, must be an expert!
How can people get this so bassackwards? It’s so damn simple. Why do people want to complicate it?
You’re simply distinguishing real property. Think land and fixtures attached to the land that can’t be moved. There is also personal property. Think tv’s, clothes, cars, refrigerators, etc. And there is intangible property. Think currency, stocks, bonds, mutual funds, insurance policies, equity, accounts, liens, etc.
While each category is dissimilar, they all share a couple of commonalities. Each comes with unique sets of rights and duties. Each can be stolen. And once stolen, each requires drawing upon the power of the state for recovery. Thus, money is a subset of property.
Are you guys all playing a joke and gaslighting me? Every 1L in the world knows this.
Ok. As invited, I pounded you on the definition of money.
I give your MMT analysis a standing ovation! You nailed down what I was ineptly trying to state above in regard to Prof. Kelton.
Webstir
Stanley:
I web searched your essay, but the link you provided goes to a “404 not found.”
Going to start reading now.
Webstir
Stanley:
I’m reading, and it occured to me that your Simmel quote, “money is a claim on the resources of society” describes the rights that money confers, but fails to describe the duties. Not stealing it, for example. As Bernie Madoff found, that quickly turns you into neither a sovereign, nor a subject. You become a ward of the state. Other duties? Don’t destroy it. Don’t make your own. And don’t misrepresent how much you have. I’m sure there are others — working from the top of my head here.
This whole thing we call “society” is what we call the hodgepodge of rights and duties we’ve cobbled together throughout history, which through momentum alone, persist. There are no rights, without corresponding duties, in a society.
Mel
@different clue
“and we mandated zero federal taxation, what would happen as we kept issuing more de novo money[?]”
You’re absolutely right. It’s not smart to mandate zero federal taxation.
The MMT line on taxes is developed from Abba Lerner’s Functional Finance, which said that the main reason to tax was to remove money from parts of the economy where the money is unnecessary or harmful. It may be that some people get confused between that and the other MMT statement that State spending doesn’t depend on taxation. It’s more accurate to say that taxation depends on spending.
Mandos
I couldn’t help but notice that this is from the person who said they don’t read my front-page posts unless I’m writing about climate change.
different clue
@Mel,
In the very baldest simplest terms, what makes it not smart for the federal government to declare and enforce ZERO federal taxation while de novo issuing and spending-in-the-first-instance into the economy the newly keystroked-into-existence MMT money? I am assuming the money does not self-extinguish as soon as it is spent. I am assuming the money is intended to last and last in terms of being able to be spent again and again from hand to hand to hand on any this-or-that which is made or done anywhere in the economy in exchange for that money. I am assuming that the MMT money supply just increases by exactly the amount of the de novo issuance of the MMT money.
So in the baldest and simplest possible terms, what happens to the spending power, the publicly accepted value , of each unit of MMT money as the number of those units just goes up and up and up while the government takes ZERO units of its own MMT money units back as taxes?
Why exACTly, explained in the very simplest terms for the total layman to understand, is it “not smart” to mandate zero federal taxation of any of this MMT money? What exACTly happens to the worth and economic-transaction-interchange-facility usefulness of the ever-rising amount of MMT money?
I have done my best to make the question exACTly asked so as to make the question exACTly answerable. If it is still not exACTly and BALDly and LITERALLY answerable with Army Field Manual clarity and exactitude, then I will have to fall back on the O’Reilly method of getting the question answered. I will have to say ” this is exACTly what happens, in DETAIL. Or am I wrong?”
robotpliers
Hugh writes:
That is what the value of fiat money rests on. It is a slender support, subject to rapid change. This is why currencies are tied to some kind of real asset, to provide assurance that the government is dealing with reality, will base its economic decisions on some portion of the assets its holds, and also won’t go around trying to expropriate the total resources of society via the printing press.
The CSA also issued fiat currency, and suffered price inflation of ~92x after increasing the money supply by ~20x during the war. They also lost the war. In the North, US greenbacks were initially issued as Demand Notes, redeemable for gold, but redemption was suspended, their value declined, and the government had to prop up value by promising to pay interest on them, effectively converting the cash into a form of certificate of deposit. These initial Demand Notes were retired after ~1 year, but many remained in private hands and eventually fetched a premium compared to the later US Notes. United States Notes were issued in 1862 and were not backed by gold, though the government simultaneously committed to paying interest on its debt and duties on imports in gold only, carefully limiting the scope of the fiat currency. At war’s end, the US Notes declined to roughly half their nominal value vs. gold, and that valuation was propped up largely because (a) the North won the war and (b) was able to maintain the overall credibility of its finances through stronger taxation, valuable exports, and promises to cease fiat money production after the war was over. Remaining US Notes were eventually reabsorbed back into the gold currency system by 1875.
In short, the CSA and US both issued fiat currency. The CSA’s was a disaster, but people never seem to talk about that. The US’s fiat worked ok, because it was acknowledged as being a temporary war expediency, and the gold standard was maintained for all other currency, plus gold was promised to be used to pay all outstanding debts and import duties.
Nowhere in the above do I see a good argument for transitioning an entire country’s currency to fiat on a permanent basis.
Right, but MMT says we do have a fiat currency but its only some stubborn old rules about issuing bonds that are holding us back from unleashing it. What MMT proponents don’t realize is that those rules actually provide a real backing to our currency (value of assets held in the economy), and removing them would drastically alter the relationship between our currency and the political economy of the nation.
different clue
@Mandos,
Thank you for your interest in my comment. I am always happy to hear from you. Please let me know if you have any other concerns.
bruce wilder
robotpliers
Yes, the New Deal did create not a pure fiat currency, but what you call an asset-based currency. And, MMT’s current fashion for disparaging borrowing by the sovereign seems dangerous to me and de-stabilizing. (I did scan your previously linked essay and found a lot I basically agree with.)
It should be noted that the gold standard after the Civil War proved to be an economic catastrophe for most of the U.S. population, triggering a very long depression in the midst of what should have been a period of very rapid economic growth due to technological progress and Western expansion.
Stanley Dundee
Bruce Wilder, when you say
you are getting to the heart of things. I would rephrase that to say that the current social function of money via the empowerment of banking is to ensure that the flow of resources is directed to those who have the capacity to create money, i.e. the bankers themselves. (I’m paraphrasing Michael Hudson here.) But that’s a policy choice, not an inevitable outcome, possibly. Understanding fiat money may help make it possible to divert its function to one that serves a wider constituency.
Different Clue, I invite your politely raised or otherwise. Over at Naked Capitalism it’s truly dangerous to unleash the MMT flame wars but folks around here seem calmer and less committed to ideological frenzy. And:
Now you’re getting somewhere! I like to imagine a society of local-scale stewardships, each of which creates its own currency, taking responsibility for the needs of its neighborhood as well as some particular specialized functions (e.g. manufacturing, agriculture, specialized health care, etc.) that support trade with wider-ranging stewardships (and ordinary private interests) via both pairwise swap lines of the local currencies as well as in the background fiat currency of the local sovereign. Totally consistent with MMT; the state is uneccessary (but can be accomodated). Indeed one could say that unhinging money from the state might be the optimal route to, dare I say it, anarchist utopia?
Regarding zero taxation, it seems that it would eventually lead to debasement of the currency. MMT teaches that taxation gives money its value; citizens must scramble to get some to pay their taxes. Hence, no taxes, no value. But to return to the anarchist utopia, if money could be redeemed for essential services supplied by the issuer, e.g. food, shelter, health care, education, etc., taxation might indeed be optional, since the money would disappear in return for the services, to be recreated in payment to providers of services and materials.
Webstir, thanks for bringing the legal perspective into this. And thanks for the kind words on my MMT analysis! Apologies for broken link, shame on me. I’ve lately seen several references to a branch of MMT that originated in legal scholarship but I don’t have any hard cites for that. Would you recommend anything? I don’t disagree that money is a subset of property, another social construct. What I would say is that it’s useful to distinguish finite from unbounded. Land, materials, human effort, etc, are all finite. Money and other intangibles, not so. The path to creation of tangibles is basically independent of money, reliant on nature and human effort, although money is inserted throughout by social fiat. But money creation and destruction is entirely arbitrary and hence under much greater social control.
Hugh, is there more to your critique of MMT than the neoliberal leanings of its most prominent advocates? Do you question the fundamental premises, e.g. fiat money is unbounded, taxes don’t pay for spending, banks create deposits by lending, etc? Do you doubt that a job guarantee can be made to work in such a corrupt society? I ask in all sincerity: I’ve admired your insights since long before you were purged over at Naked Capitalism, and you’re a big part of why I’ve been lurking here for ages.
Likewise, Ian. Permit me to interject heartfelt appreciation to you as our host philosopher and moralist for keeping a focus on the spiritual void that seems to be swallowing Western civilization in our late neoliberal funk. Returning to MMT, agreed that there’s a cultlike aspect to the followers, but the rush that comes of realizing just how wide our policy options actually are may account for some of that. Are there theoretical/ideological specifics, distinct from the shortcomings of the followers, that lead you to dismiss MMT? I hate to see the baby go out with the bathwater.
What a delight to participate in such a discussion! Many, many thanks to all and especially our host!
Mel
@different clue
Sorry, I committed the same sin that I accused unnamed others of: getting confused and answering a question that nobody was asking. Off the top, I would give the same answer Stanley Dundee gave, that money would accumulate in excess of what society needed and, indeed, in excess of what people could produce. I think that’s eminently possible, but there’s no reason to assume that it’s the only thin possible.
We have an example of it in the effects of QE and TARP, which are instances of the Modern Monetary System creating money out of nothing. Values of financial assets exploded as players in finance were handed the money to bid them up, housing got the same treatment. The unfortunate side effect is that houses are “assets” (from the finance point of view), but are also things people need to survive, and the people that need them weren’t included in the QE money flow. That’s an example of money piling up in harmful places.
But the game that’s been played lately need not be the only possible game. I’m going to have to think about this a bit.
nihil obstet
On just printing money and its losing value — is this somehow distinguished from the old definition of inflation of “too much money chasing too few goods”? In war time, production goes towards armaments and other goods tend to be in short supply. Without rationing or price controls, the price of goods will skyrocket (that is, the value of money will plummet). This will be true whether the money is paper or asset based. In any tale of rich refugees fleeing revolution, gold and diamonds similarly lose value in comparison to food, shelter, and transportation to safety. The asset will of course retain its value as an asset, and paper doesn’t retain value except for historical collectors. Finally, it would seem to be the government’s ability to enforce the value of money, by a number of means including taxation and ruling that creditors must accept money in repayment of debts.
On money without governments — wasn’t that what banknotes were? It was when government got into the FDIC business that money got as stable as we think of it now.
I think there are probably differences between MMT and financial theories that have come before, but I haven’t been able to understand why its advocates believe that if everybody understood that we don’t pay for government services with taxation, we’ll suddenly have job guarantees and free college. As Dick Cheney said, “Ronald Reagan proved that deficits don’t matter.” If anyone was in any doubt that the U.S. government can implement virtually any domestic program it wants, the $14 trillion it came up with virtually overnight in 2008 to make sure Lloyd Blankfein got his multi-million dollar bonus for doing a good job should have removed that doubt. When I said that no limits on spending just meant the elites could have more wars and lower taxes, I was told that no, MMT includes a job guarantee.
There appear to be two aspects to MMT. First, there’s a purely financial aspect about how money works. It strikes me as largely an academic issue of the sort that fuels academic careers. Those can produce clearer, more realistic theories or not. The other is a set of political objectives. But I can’t see the bridge between the two except as religious fervor, belief on one side and ritual on the other. I’d a lot rather see the fervor go more directly toward political goals. A job guarantee would be a very good thing, but that’s no reason not to go hard for higher minimum wage and job protections rigorously enforced, union support, and expansion of the government workforce for needed common services.
Stanley Dundee
Here’s another money definition (better, attribute):
Those who have the power to create it get most of the say in how it’s used. The present usage as class war cudgel (low wages, high rents, tolls for education, predatory finance and health care, electoral corruption, etc.) is hardly exhaustive (at least according to MMT) but maybe it’s the most typical usage.
Hat tip Bruce Wilder.
Tom W Harris
The rap on MMT is that it’s a neolib con to justify not taxing the rich. That doesn’t square with the emphasis its advocates placed on discrediting the “OMG, the deficit!” baloney used by DemsAndPubs to shut down talk of social spending. “Deficits don’t matter” Cheney gave that game away.
Funny how deficits don’t matter when gubmint money flows up. But when it flows down, Google
“mcconnell deficit” to see how deficits are suddenly “disturbing.” A sick, unfunny joke. And if the Dems were an actual party, they’d geat the Pubs over the head with it.
Hugh
In the past, I have gone through the major assertions of MMT point by point and shown that they are either false or trivial. In this thread already I have pointed out that the MMT jobs guarantee is not what most people think a jobs guarantee is or ought to be, that the value of money does not come from where MMT says it does, that money creation occurs through the Fed not the US government so the US doesn’t have a real fiat currency, that MMT’s position on taxing the wealthy and corporations is far as in Koch brothers right wing. I have said many times that MMT was put together by people who know shit about the structure of theory, which is why it is so incoherent and why it can’t explain or rule out what we have now, MMT for the rich. There are other points I could go into but why bother?
Money is a medium for moving resources around a society in order to create the society we want to live in and maintain it. Leaving large amounts of money in unproductive places (with the rich, in corporate accounts, in their bubbles, etc.) subverts this purpose and opens up our society to great harm from it.
bruce wilder
On just printing money and its losing value — is this somehow distinguished from the old definition of inflation of “too much money chasing too few goods”?
The Quantity Theory of Money has an unfortunate fascination for the human mind: there’s this basic notion, with a long history in economics, that money are the tokens of currency and you need a certain quantity to support a given “velocity” of transactions in goods and services, given the matrix of prices (aka the price level and the unit of account).
The “printing press” narrative is based on this very basic concept of the functions of money. The hoary idea that money is neutral in the long-run — a favorite of no less a personage than Krugman — is based on this idea of money as supplied in quantity. In the days of money backed by precious metal specie (coins), there was a certain sense to it, I suppose.
It is unfortunate that vulgar MMT rhetoric so often concedes the idea that money is a quantity, as when they argue that banks “create” money by means of mere journal entries. (Strictly speaking the banking system as a whole does expand credit, a point never really contested by mainstream economics, which merely asserts that an individual bank needs reserves and funding (e.g. deposits). Mainstream economics goes fatally wrong when it promotes the concept of loanable funds, the idea that money is not only a quantity but an almost viscous liquid encapsulating barter-exchange which banks borrow from savers and lend to borrowers — that’s absurd. (Also, a theory favored by Krugman among others.)
I think it is wrong to think about money as any kind of scarce commodity. It is terribly inefficient to use anything of intrinsic value as a money, because money is basically a score-keeping device. Money should be no more scarce than points awarded in a basketball game. The referees do not arrive at a basketball game with a bag full of points and then call the game if they run out. It is ridiculous. Just so with money.
As far as I know, money as a mechanism for score-keeping is good MMT.
I wish MMT advocates were more self-disciplined about sticking to the score-keeping story. When a bank gives a business credit, the bank is score-keeping — that’s all. If the score-keeping is reasonably accurate and honest, that’s to the good of the society. Governments and the general public ought to want to see banks kept honest in giving credit where credit is due. But, the public policy issue is not the “quantity” of money, but rather the accuracy and truthfulness of the credit.
To me, Bill Black, with his work on criminogenic environments and control frauds, goes to the core of what monetary policy ought to be about: not a ritual interest rate but the regulation of banking and the payments system to suppress fraud. That would be my idea of good MMT.
Money isn’t about currency tokens. The Fed and Treasury manage the supply of currency so that there is never any shortage of currency, per se. Having tokens in circulation is a relatively trivial problem for technicians and tokens for exchange are not a good way to think about money.
Money is about uncertainty and risk. Accumulating money in whatever form is about hedging and insuring risk and uncertainty.
Minsky is excellent on this point. Wynne Godley, I hear, was very good.
The current crop of MMT advocates seem a bit more at sea.
Webstir
Hugh:
“Money is a medium for moving resources around a society in order to create the society we want to live in and maintain it.”
There we go.
Now, replace two simple words and see how it sounds.
“[Law] is the medium for [securing] resources around a society in order to create the society we want to live in and maintain.
Two sides of the same coin.
Hugh
“money as a mechanism for score-keeping is good MMT”
Score keeping of what? If there is a score, what is the game? What are the rules? If deficits don’t matter in MMT, what does this have to say about the point of score keeping?
As for banking, I think plain vanilla banking, the kind that most people are familiar with and use, should be run as a public utility.
Stanley Dundee
Hugh, thanks for your reply. That’s a solid critique. I will respectfully respond where I think I can add something useful.
The idea of a job guarantee, which I attribute to MMT, is hugely threatening to the plutocracy, for whom low wages, a docile (frightened, insecure) populace, and of course a reserve army of the unemployed are key features of the neoliberal hegemony. Done well, the job guarantee seems like it could provide a living wage floor for wages, as well as subsidize valuable human services that are poorly served by private business, and, finally, offer the dignity of meaningful work to many whose lives are diminished by denial of a contribution to society. Designing and implementing a jobs guarantee that benefits the many and not the few is the hardest thing in the MMT playbook. I hardly think we should be limited to what’s been proposed by the professariat. Devil in the details, but well worth fighting for in my estimation.
This one is very interesting. I tend to think we have a non-exclusive situation. Belief in the ability to exchange money for resources may indeed be rightfully founded, but unacknowledged, on the fundamental necessity of tax payments. But is it necessary to use coercive taxation to give value to money? I think not, and a system with numerous small scale sovereigns (stewardships, in my thinking) issuing their own currency, which is exchangable directly for basic human services, is quite dear to my heart.
MMT teaches that the Fed is branch of US government. I sometimes feel that US government is a branch of the Fed. Either way, neither the gov nor the fed is offering anything tangible to back the money, so it seems like fiat to me. The Fed is a a creature of law, and law can be changed. Again, we need to open up to the wide latitude of potential policy, not the impoverished menu of war, debt, and austerity currently on offer from our owners and rulers.
Here, you are here conflating certain MMT personages with the entire theory, which seems a bit unfair. I will say in defense of the professariat that they are clinging to their places at the edge of the Overton window and they are trying a reach a wide audience that is thoroughly propagandized with serious untruth. Some MMT advocates, like myself, enthusiastically support aggressive taxation. Enormous concentrations of wealth are inherently anti-democratic and a healthy democracy uses taxation in part to protect itself from corruption by an excessively wealthy elite. Moreover, when those huge piles of wealth have been extracted by predation on the weak, with consequent expansion of poverty and destruction of a middle class, a healthy democracy would bring the law to bear against malefactors of great wealth.
Well I don’t know shit about the structure of theory, so guilty as charged. As for explaining why we have MMT for the rich, that’s a job for historians and analysts. Michael Hudson is very helpful in these matters. Philip Mirowski too. And then there’s annoying loudmouths like us.
Nothing to argue with here! I would only say MMT helps us to understand how wide our latitude is for changing this, if we can get our hands on the levers of power, even at fairly small scales.
Thanks again, Hugh, for the stimulating discussion.
bruce wilder
I think the Job Guarantee is a truly bad idea. Universal Basic Income is at least administratively possible, a Job Guarantee is misconceived on multiple levels, from the nature of employment to the purposes of state action to the dynamics of the macroeconomy. Focusing on the Job Guarantee is worse than focusing on the deficit as a navel-gazing guide to policy.
The answer to predatory finance is legal repression. Make finance small-scale, atomistic (many specialists), afraid, boring. A public utility, as Hugh says. Muster the political will or give up, but do not make a hobby out of furious fantasy in blog comments.
Hugh
Stanley Dundee, you’re welcome.
different clue
@Tom W Harris,
The present day Democratic Party is led and owned by the ClintoRats and the ObamaRats. They are co-conspirators with the Republicans to destroy our Social Security and privatize the money and revenue streams over to Wall Street.
bruce wilder
From Angry Bear:
Senate Majority Leader Mitch McConnell said yesterday, Tuesday, October 16, 2016:
“The only way to lower the record-high federal deficit would be to cut entitlement programs like Medicare, Medicaid and Social Security.”
Do we need someone to say idly in the manner of academics, “deficits don’t matter”? Or, do we need power to press back against this unbridled greed?
different clue
@bruce wilder,
Well . . . we would need power to press back most effectively. In the meantime, we could at least say that we didn’t have this deficit till exactly after the latest upper class tax cut. If Social Security had diddit, Social Security would have diddit a year ago or more.
Plus also, Social Security takes in more money from all us FICA payroll tax payers than it pays out to all the people now on Social Security. That means its building up a surplus, not running a deficit.
People could then decide whether it is more politically effective to accuse ‘Light-fingered Mitch’ of lying, or more effective to accuse ‘Kentucky Mitch’ of being too stupid to know how Medicare and Social Security works, and too stupid to know that “effect” comes after “cause”.
( And not just in the dictionary).
different clue
But this is not the time to prance about displaying superior knowledge about MMT and about “your taxes don’t fund Federal Spending and they never did.” People may well respond by saying
“if our FICA taxes don’t fund Social Security and never did, then what did our FICA taxes pay for?
Was it all a scam from the start?” That could put people in a mood to vote for a New Nihilazi Movement.
bruce wilder
On the face of it, if the 90% had much of any influence on American politics, Mitch McConnell would be political toast today, mere hours after the assertion I quoted. Third rail of American politics and all that.
If counter-arguments were needed, academics and pundits would supply them, journalists would report on the motives of McConnell ‘s policy proposals and that would be that.
No one would dither over whether McConnell was a liar or stupid. Everyone would understand the answer to the question, cui bono? Everyone would understand that politics comes down to a struggle over the distribution of income and wealth and McConnell works for the rich.
But politics is confused because everyone in a position of prominence in politics, in the media and academia works for the rich. Many are the rich.
The merely middle class sponsor no think tanks, own no television networks, and belong to no membership organizations in which they could concert understanding and action. The people they read in the newspaper or watch on television for informed guidance — Rachel Maddow or Tom Friedman or Sean Hannity or Paul Krugman, say — are generally reckless, irresponsible ignoramuses. “You can’t fix stupid,” pontificated Friedman yesterday. He wasn’t talking about himself but he might as well have been. (He was explaining that he wasn’t really wrong about Mr Bone Saw’s programs of reform.)
Hugh
I’m waiting for Trump to hire OJ to find the “real” killers of Khashoggi.
Just a reminder. The Social Security Trust Fund is an accounting fiction. Any surplus funds going to Social Security are kicked into general revenues and spent. The SSA gets some pieces of paper in exchange. They even pay some equally fictional interest although the SSA does not manage this fictional portfolio in such a way as to maximize that interest. The Trust Fund comes out of the 1983 bipartisan Social Security reform designed by Alan Greenspan (it’s what made him a made man) and signed into law by Ronald Reagan. Until the 2008 meltdown came along, it was the biggest con in human history.
Forget MMT for a moment. If the high end income caps on contributions had been removed, Social Security would remain solvent longer and FICA taxes on most workers could have been lower, i.e. the rich pay more, everyone else pays less. What happened of course was the opposite. The rich paid less into Social Security. Everyone else paid more. And not just more but in excess of what was needed to cover the outflows. As I said, this surplus went into general revenues. It was free money for the pols of both parties and came out of working people’s paychecks. Now at some point, in theory, when outflows exceed inflows and Social Security goes into deficit, money from general revenues would be needed to cover the shortfalls. This is terrible from the viewpoint of the PTB for two reasons. First, no more free money. Second, the rich pay most of the income taxes. So this would be money which they would be paying in which would not be coming back to them. This is why the retirement age has been pushed back and why there are so many attempts by both Democrats and Republicans to reduce benefits.
If the government had pledged back in 1983 or at any time since then to cover any shortfalls, that is all that would ever have been needed, no Trust Fund involved. If longer term refunding was required, there were always the income caps and general revenues first before revisiting payroll taxes.
Now with MMT, you could argue no FICA was ever needed, let alone a mythological Trust Fund. About all you would need taxes for would be to extinguish excessive wealth among the rich.
Willy
It’s a bit close to midterms to be talking about cutting popular programs when ever increasing numbers of the young rabble are becoming better informed.
different clue
@Hugh,
If the Trust Fund itself is “mythical”, that means that all the other Treasury Debt Instruments are also “mythical” and trust itself is “mythical”. And if people are told that, trust itself will not even be mythical anymore. It will be gone, and we will be ready for Nihilazism.
Just because Greenspan designed the Great Reagan Rescue of 1983 as a deliberate long-range con does not mean that we should be expected to say “oh well, easy come easy go” , surrender, and agree to treat it that way. I regard my promised benefits, as promised by the “Trust Fund” as real.
And all the special Treasury Debt Instruments which the Social Security Administration holds could be redeemed in full with money to repay us pre-paying beneficiaries by the very same expedient of taxing the rich levels of society . . . at the very least clawback-taxing the entirety of their Bushobama tax cuts through the latest round of tax cuts, since those cuts were engineered to be “covered” by ex-post-facto embezzelment of all the FICA taxes paid into the Trust Fund.
If we are not going to be able to tax the rich under the rubric of Redeeming The Trust Fund ( promises made, promises pre-paid-for, promises kept), then we are certainly not going to be able to tax the rich under any other rubric or set of social conditions.
So what exactly is gained by treating the Trust Fund which we FICApaid into with real labor over real time as . . . “mythical” from the start and “mythical” all along?
Hugh
The Trust Fund is mythical. The money is gone, spent. You, we, have been had. How Social Security payouts are handled in the future will have nothing to do with the Trust Fund. The Trust Fund at most represents a promise, but that promise could have been made without costing a dime.
different clue
Is the Trust Fund any more mythical than Treasury Bills and US Savings Bonds and etc.? If it is more mythical than those other things, what makes it more mythical?
Webstir
Stiglitz has a thread extender here:
https://www.scientificamerican.com/article/the-american-economy-is-rigged/
As a due paying democratic socialist, why MMT if you can Georgist?
All this shit just really comes down to class.
Webstir
Oops.
I said shite, less the e.
Into the mod pod go I.
Webstir
btw … As I’m sure some of you saw, the Stiglitz article that went into mod b/c I said shite, less the e, was torn from NC this morning.
Anyone dare me to make the same argument there?
Could get interesting.
Hugh
The Social Security Trust Fund is money the government owes itself (for something it was going to do anyway in the future). It is an accounting fiction. It is mythical. T-bills and Savings Bonds are not money the government owes itself. They are straight debt instruments.
bruce wilder
Distinction without a real difference there Hugh.
Hugh
Yes, if I “owe” myself 5 dollars, that’s the same as me owing you 5 dollars. Good to know.
different clue
@Hugh,
No. The SS Trust Fund holds actual debt instruments from the Dept. of Treasury, I believe.
It is NOT money the “government” owes “itself”. It is money the GENERAL BUDGET government owes the Social Security Administration. It represents money ( which represents monetized work-per-unit-time taxed from FICA-covered workers) taken aWAY from the FICA taxpayers and given to the GENERAL BUDGET government. If it is not repayed, then it will have been embezzeled from the FICA taxpayers who paid that separate money in a separate stream to a separate agency.
bruce wilder
complaining that anything associated with money and finance is “mythical” is rank nonsense, because it is all fundamentally fictional. The bonds sold to the Social Security Trust fund are nothing more than a commitment device, something much needed in human political cooperation generally as well as this case particularly.
I understand why someone on the Right bent on opportunistically seizing the funds might wish to attack the commitment. Why Hugh does so is perhaps best left unexamined.
Hugh
different clue, when you call it embezzlement, you are close to the truth. The Social Security Trust Fund was a stealth tax on ordinary Americans. The people who will “pay back” the Trust Fund in the future should be the rich, but this is precisely what the PTB wish to avoid. That leaves either cutting back on benefits/increasing the retirement age, foisting the repayment on to the next generation of American workers, or some combination of the two. We have already seen both rhetoric and moves in this direction. So if you take out a loan and manage to get the people who made you the loan to pay it off or modify the terms so that you pay back little or none of it, you have an idea of what is going on here.
I think that such a huge con as the Social Security Trust Fund was so easy to sell is precisely the confusion between real debt instruments and fake ones. It reminds me of all “innovative” financial products, the derivatives, the CDS, the CDOs, the CDOs squared and cubed, the synthetic CDOs which blew up the world financial system back in 2008. If you actually looked at them, none of them were legit, but before the meltdown, it was considered heresy to question them.
Hugh
BTW here is something like the new Saudi Khashoggi story. Khashoggi entered the Saudi consulate where a 15 man Saudi kill squad happened to be loitering. For some unknown reason, a fistfight broke out between Khashoggi and the people trying to kill him. At this point, Khashoggi tripped and fell on a bone-saw which happened to be lying about, and he accidentally dismembered himself. The kill team being neat and civically responsible tried to clean up the mess as best they could. In the process, certain parts of Khashoggi, as in all them, were lost or misplaced. Such things happen.
bob mcmanus
Just read up on Becket-Henry, and wondering why the Press doesn’t have the power that the Medieval Church had to force MBS to kneel in public and take 100 strokes from reporters. Curious as to what kind of penance can be exacted.
Sad at our current level of tyrants who lack the political skills of a medieval asshole.
bob mcmanus
Since this is an open thread, I’ll be revealing, and have a thought about Becket, Henry II and the politics penance. Wikipedia:” then each of the 80 monks of Canterbury Cathedral gave the king three blows.” With a “rod” something between a switch and a staff, iow, thick.
This could have killed Henry.
So most to all of the strokes had to be symbolic and very light, and this pretty much had to be assumed going in. Don’t really want monks killing a king. But there certainly could have been just a couple asshole monks, and who knows what can happen when blood lust rises, so Henry was taking a huge chance here, putting his life and health in peasant hands.
But the monks didn’t hurt him.
I am a bottom up kinda Marxist, and am always interested in stories that show the power, cooperation, and complicity of the lower orders. Stuff was more democratic than we are usually told, and many of the stories about jerks at the top with power oppressin’ us are designed to make us feel powerless victims.
Hugh
MBS = Multiple Bad Stories
drumlin woodchuckles
( the newest story from the KSAgov reminds me of the News-Satire story that National Lampoon ran in its magazine right after the death of Allende.
” Present Allende shoots self in head 27 times, pausing only twice to reload”.
metamars
Depressing interview for progressives who look to take over the Democratic Party. The insiders are making things more difficult for progressives. https://jackrasmus.com/2018/10/19/is-a-3rd-independent-progressive-party-on-the-agenda-in-us-audio/
“Dr. Rasmus invites guests, Nick Brana and Alan Benjamin, to discuss the growing demand for a 3rd, independent political party, now supported by 67% of Americans according to a recent Gallup Poll. Nick Brana is the former national coordinator for the Bernie Sanders 2016 campaign’s liaison to the Democratic Party, formerly the electoral manager for the post-2016 ‘Our Revolution’ movement behind Sanders, and a prior director of Democrat campaigns for governor (McAuliff) and Kerry. Alan Benjamin is a former delegate to the San Francisco central labor council, AFLCIO, a union member and long time activist in Latino politics in California. Both guests are now active in the ‘movement for a People’s Party, a coalition of labor, community and progressive activists with 50,000 signed supporters.”
Webstir
metamars:
It’s high time.
Lambert has been railing on this for a while now. The progressives won’t take the Corprocrats by storm because they own the machinery. Better to build one’s own machine.
Webstir
And, an interesting excerpt from Mark Ames that, ahem, lines up neatly with a point I was making a while back:
“By a quirk of historical bad luck, the American Left has gone two generations without understanding finance, or even caring to understand. It was the hippies who decided half a century ago that finance was beneath them, so they happily ceded the entire field—finance, business, economics, money—otherwise known as “political power”—to the other side. Walking away from the finance struggle was like that hitchhiker handing the gun back to the Manson Family. There’s a great line from Charles Portis’s anti-hippie novel, “Dog of the South” that captures the Boomers’ self-righteous disdain for “figures”:
He would always say—boast, the way those people do—that he had no head for figures and couldn’t do things with his hands, slyly suggesting the presence of finer qualities.
That part about the hands—that would refer to the hippies’ other great failure, turning their backs on Labor, because Labor didn’t groove with the Hippies’ Culture War. So the Left finds itself, fifty years later, dealing with the consequences of all those years of ruinous neglect of finance and labor—the consequences being powerlessness and political impotence.”
Ahem.
metamars
@Webstir It’s not so cut and dried. I’ve written a lot about voting blocs which aren’t loyal to any political party (instead viewing them as vehicles) as being the critical organizational unit. (on openleft.com and firedoglake.com)* A progressive leaning voting bloc could and – I would argue – should engage the Democratic party with real, live candidates, even IF ONLY to show up the Democrats as corrupt, and thus to collapse support for them. A portion of that collapsed support will vote for the 3rd party.
It’s probably useful to view “taking over the Democratic party from below” as a prime tactic, with 3rd party votes by the voting bloc being Plan B, if they can’t prevail in primaries. However, the Democrats rigging their primary process EVEN MORE strongly suggests that the Plan B option will be triggered that much more often.
The Democrats – and probably the Republicans, also – have rigged their system by forcing candidates to sign pledges that they will support the eventual nominee. That is unfortunate, from a reformist point of view. However, it’s the voting blocs that should be calling the shots. Even if a progressive candidate is forced to support a bad Democrat, there’s absolutely no reason why the voting bloc, which had supported that same candidate during a primary, should be led, like sheep, into doing so, also.
* google: metamars site:shadowproof.com gaming voting blocs
unfortunately, I don’t see the diary where I laid out a dynamic scenario of voting blocs joining together (or not) depending on the degree of common platform with the same candidate, as well as the result of their collective decision making
Nancy Bordier was pursuing a systematic approach to online voting bloc formation and evolution, but apparently her project never went anywhere.
IMNSHO, it’s a sad commentary on the public and the ‘activist’ community that thinking in terms of voting blocs isn’t common, perceived wisdom. Instead, it’s NOT EVEN DISCUSSED. The lack of discussion of the Gilens and Page expose of our ‘democracy’ is not discussed – or organized around – either. In the case of elites, I think there is a real enforcement mechanism against this, that would show it’s heavy hand if self-censorship and/or ignorance by media figures failed.
I think the lack of discussion of voting blocs by elite media (or even alternative media) has more to do with the fact that they’re probably not smart enough to figure this out, on their own. But I’m basically guessing…. Furthermore, it’s not like political game theory is widely taught.
BTW, as I’ve mentioned at correntewire (to the dismay of Lambert), a very talented psychic named Ingo Swann had written about how there is no schooling, available to the public, to teach about the acquisition of power. See https://duckduckgo.com/?q=ingo+swann++%22secrets+of+power%22&atb=v86-3__&ia=products
“Most books about power only deal with the societal formula of the few having power over the enormously larger powerless masses, and which is mistaken as the so-called “natural order of power.” But it is not well understood that this formula also requires social conditioning measures aimed at perpetuating the continuing depowerment of the powerless so that the powerful CAN have power over them. This in turn requires the societal suppression and secretizing of all knowledge about the superlative human powers known to exist in individuals of the human species, but which are socially forced into latency in most. It is broadly understood that power and secrecy go together, but the scope of the “web” of secrets surrounding the larger nature of human power(s) is surprising. As discussed in this Volume I of SECRETS OF POWER, empowerment is difficult if the larger panorama of societal power and depowerment are not more full understood.”
iconoclast
‘I don’t think Eschaton is a Democratic establishment blog. ‘
This long time Eschaton commenter agrees. The commenters definitely seem to be a lot more progressive than they used to be in, say, the Bush 43 era.
Webstir
iconoclast:
I agree. There are more and more exceptions. But again, as stated above, there is well established bloc that will jump all over you if you don’t toe their Saint Hillary line. And it’s not limited to Eschaton by any means. For example, just last night I got jumped by a couple of them over at emptywheel on a bmaz post. That thread is produced below.
Webstir:
“The American press seems to normalize whatever this president and his foreign allies do … .”
Here, let me help you with that:
“The American press seems to normalize whatever [any] president and his foreign allies do … .”
There. That’s better.
J R in WV:
October 20, 2018 at 12:14 pm
“The American press seems to normalize whatever [any] Republican presidents and his their foreign allies do … .”
Can you even pretend the American Press normalized President Obama, or Secretary Clinton? Because if you attempt to claim that, we will all know that you are a Russian Troll, as your ‘nym indicates. Amazing claim to postulate that the Press normalized anything Obama ever did. His clothes were wrong, let alone his religion, his wife, his daughters, his citizenship, his race, all was perverted and anti-American. Or can you not remember 4 years ago?
When his Supreme Court nominee, required by the constitution, was rejected without a hearing!?!?!!!
Tracy Lynn
October 20, 2018 at 1:31 pm
Thank you for this.
errant aesthete
October 20, 2018 at 3:24 pm
Seconded.
Peacerme
October 21, 2018 at 9:25 am
Thirded.
Webstir
October 21, 2018 at 2:06 am
Oh for crying out loud. People here know me & you’ll find my handle over at Naked Capitalism, Ian Welsh, Eschaton, etc.
And yes, they normalized Saint Obama & Hillary. Libya? Drone attacks? Ignoring Yemen. Yes, all that happened on their watch. Get real. Stop being so tribal and use your brains.
Reply
Webstir
October 21, 2018 at 2:10 am
“His clothes were wrong, let alone his religion, his wife, his daughters, his citizenship, his race, all was perverted and anti-American.”
Oh, well then. You must be right. All those things definitely equate to killing innocent people with drones.
Good lord …
They’re everywhere, and they’re a cancer on progressivism.
Ten Bears
Uhhmmm, Web, you went looking for a fight and found it. There’s a term for that.
After a fifty post interlude we’re back to the original question, which accentuates a point I made earlier. And again I suggest you are juggling apples, oranges and onions. What exactly have these three blogs done to earn your ire? As near as I can tell you aren’t blocked from posting there. Is it that those comment forums run to such a size your comments are lost in the haze? I am genuinely at loss as to what your point was one hundred comments ago.
There’s a lot to be said of we “hippies” turning our backs on traditionalisms and the consequences thereof. It has long been my contention we dropped the ball. We stopped The War. Our War. VietNam. But we didn’t stop War. And we left the machinations in place to become what we have become.
We were winning, as Hunter S Thompson put it, and then … we weren’t.
nihil obstet
What’s rarely pointed out in relation to the Baby Boomers is that the promises of their childhoods were broken when they were young adults. Throughout the 50s, futurists and politicians promised better material lives and greater leisure. The Boomers responded by seeking a more inclusive society. Not all, of course. For every Bernie Sanders arrested for protesting de facto segregation, there were more Hillary Rodham Goldwater girls. But most protests were against the war, against the CIA both for its spying on domestic dissenting groups and its casual sauntering around the globe inciting coups, for environmental protection.
Meanwhile, in 1972, average wages hit their high point and then stagnated or started down. More family members got jobs to maintain standards of living. Wage workers were expected to work longer hours. Far from a Great Society of public goods, privatization and its ills advanced. FICA taxes doubled so that boomers would pay for their own eventual Social Security benefits as well as their parents’.
The generational warfare gang wants to sow the idea that the Boomers had it good and selfishly grabbed it at the next generation’s expense. It is more true that the “Greatest Generation” had it by far the best. If you want to talk about the sins of the generations and what caused them, you should include the way the whole framework of political and economic life shifted during the Boomers’ lives — the end of increasing pay as a share of increasing productivity, the end of pensions, the failure to enforce labor laws, the rulings against unionization, the increased cost of children’s education, the loss of a member of the family who could do the necessary unpaid labor of living . . . .
Webstir
Ten Bears:
Pretty sure all I’m doing is bringing to the fore, what I feel, is an internal battle for the hearts and minds of the “left.”
That being said, those I bring the fight to are poseurs that want the benefit of feeling morally indignant, but whose actions show them to be frauds.
I think I used the term ‘cognitive dissonance’ upthread to describe it.
different clue
@Hugh,
Back to Social Security . . . . still no. the Trust Fund is just as real as all the other “debt sold, debt re-owed with interest. And the Treasury Instruments it holds are just a Social Mythology Real as any other Treasury Instruments. The SSA cannot decide to not pay future beneficiaries, based on their at-that-time past FICA payment history, the benefits which are legally due them on its own, or with Presidential orders.
That is why the Catfood Conspirators know they have to work the Congress to buy new laws abolishing or shrinking the benefits and get the President to sign those new laws. That is why McConnell said so recently that “Entitlememt Programs” will have to be addressed in a bipartisan manner because the Republicans can’t do it alone. I believe he was sending secret messages to the Catfood Democrats offering to turn over one House of Congress to the Catfood Democrats in return for the Catfood Democrats collaborating with the Republicans to destroy Social Security and Medicare . . . because it would take Congress to transform those SS Surplus-held Treasury Instruments into the “worthless pieces of paper” which the upper class would like them to be but which the upper class is legally prevented from turning them into all on its own.
Now, if the Catfood Conspirators can get that done, then maybe I will join the Nihilazi Party. And if there isn’t one, maybe I will go start one.
different clue
@Nihil Obstet
Of course the Inner Governators never intended that those doubled FICA taxes should actually be used to pay the Boomer Beneficiaries when they reached retirement. The Greenspan plan was always right from the start to expand deficits and debt to un-repayability to extort the legal abolition of Social Security from the Congress and President at some future time. So of course the Greenspan plan was deliberate embezzelment.
Greenspan himself made that clearer than clear during the very early days of the Dubya administration when he pretended to warn Congress about the pretended-to-exist dangers of not-enough-Federal-debt. He was afraid that the General Budget FedGov would find itself so nearsly debt-low or debt-free by the time all us FICA payers lived long enough to be SS beneficiaries that carrying out step two of his plan, the abolish-Social-Security part, would not be possible because there would be not be a large enough Federal Debt to be able to extort that abolition with. That is how he easily conned a wanna-be-conned Congress into passing the Bush Tax Cuts.
And of course Catfood Obama conspired with Catfood McConnell and Catfood Boehner to make the Bush Tax Cuts permanent. Which makes them the Obama Tax Cuts now. And the reason Obama did that was to keep Step Two of the Greenspan Plan in play.
Webstir
You know, I was thinking about saying something but realized — I just don’t care anymore.
As Ian has pointed out time and again, our momentum has us set to hit the wall at maximum velocity. I’ll continue to work my tail off to provide for the happiness and safety of my family when we hit. And I encourage all you urbanites to do the same.
None of this online stuff changes a thing. It’s all just a masturbatory exercise in ego stroking.
So, I’m deleting all the bookmarks and starting fresh.
I’m out.
Best of luck, all.
Willy
A personal example of boomer culture.
My sister and lifelong best friend married boomer players who only associate with other boomer players. They’ve ‘achieved’ much status in this way – which in my observations involves circumventing meritocracy by gaming the system. It’s all been who they’ve known, while advertising (and rationalizing) an appearance of achievement.
They have six children between them. None of those six are on a path which will result in a status anywhere near what the parents have. After all six kids moved out to struggle with dead end careers and student debt, what did their parents do? Expand every possible vulgar display of their wealth, including their own homes. And the kids aren’t allowed back, not without significant ‘loser’ shaming.
What the hell kind of culture does one need to believe in to think this is culturally respectable behavior? (hint: they’re conservative evangelicals)
Willy
Webstir, I’d think twice. I’ve made comments which went in here (somebodies little website), and came out there (national TV). Not kidding. You never know who’s reading, whose people may be inspired by something one’s little old insignificant self may come up with.
nihil obstet
@dc
I don’t actually think the anti-SS crew intended to double FICA. I think they thought they were on such a roll with tax cuts that they could say that the only way to save SS was to raise taxes, and everyone would say, “Well, then, we have to cut Social Security.” Instead, as we know, the response was “Well, then, raise FICA as necessary to save Social Security.” So instead of cutting SS immediately as they had hoped, they went to the longer range plan eventually to use the general government deficit as the excuse. Making SS “solvent” for another generation was not what Greenspan originally had in mind, but hey, when you can raise taxes on all the little laborers whose income is in wages while lowering the progressive income tax and still insist that deficits are bad, why not?
@Willy,
Personal example of American culture: some friends who both went to Ivy League schools and inherited some money live in a huge, architect built house and are driven (to hear him tell it) by a Tesla. So that defines Americans. Or wait, no. They’re Generation Xs. So maybe that defines Generation Xs. Anyway, why don’t your friends’ children be like Americans or like Generation Xs, whichever one applies. What culture would you say they have chosen?
Willy
I want the culture of my childhood, where the families I was surrounded with appeared healthy, happy and content with who they were and where they were living within their means. A bit less Ayn Rand, a bit more cowbell please.
Ten Bears
I was promised a helicopter. Where’s my helicopter!?
I realized in 1975 when the union job setting chokers for a sawmill I got fresh out of the Army was gyppoed out to the highest bidder that I was not going to live the American Dream my father lived.
Willy
@ nihil, sorry, my sister and her best friend. Their kids appear to be in that emotional place where they are waiting for something good to happen because Jesus always blesses the faithful. Since most are females doing things like barista and yoga instructor I’d assume Jesus will be sending them a Mr. Moneyright sometime soon (ministers are nice but seriously…). I honestly don’t know their innermost beliefs though. Quite dangerous in a shaming/shunning culture to make controversial beliefs public, lest the parents send an exorcist.
different clue
@Willy,
Is your example a typical example of Boomer culture? Or is it a typical example of Conservative Evangelical culture?
If I offered some known-to-me counter-examples of non-Conservative non-Evangelical non-WellToDo boomers known to me personally, would you dismiss them as “not typical”?
Willy
I know a rural Oklahoma-bred boomer couple who are reasonably well-to-do (if one considers a regional manager and life coach couple well-to-d0) who are also quite progressive. But they’re a bit of an anomaly I think.
The irrationally selfish tribal lunacy of the conservative evangelical boomer Republican army (which sis and friend exemplify) went ineffectively countered by their far saner peers from their generation. Why were they unable to limit these ideas? How was the Clinton ‘alternative’ which was really not an alternative, that persuasive?
I’m still lost on why smarter people couldn’t counter all the batshit, which other generations, before and after, seemed to be generally more resistant to. Did the good boomers get complacent after being promised ever greater times by the futurists and politicians? Was it all the dope they smoked?
Hvd
Also you are back to the boomers. And again you don’t look far enough back. I agree that we lost the use of our hands during the sixties and seventies and that there is a strong connections between that and the dropping of labor. This is one of my pet peeves. However what you ignore is the extensive brainwashing we received, in school and elsewhere, at the hands of the greatest and the silent that only losers and failures worked with their hands. The hippies to some extent tried to counter that with their emphasis on crafts but that could hardly compete with the skewing of career opportunities again on the part of the greatest and the silent towards white collar. By the by this trend seems to have accelerated in recent years. Your gens don’t seem to be doing much in the way of getting your hands dirty.
Willy
Did they? Most boomer males I knew could as youth, turn two old cars into one muscle car. Shop classes were popular. I knew an MBA who quit the LA financial rat race to move to rural Washington state and open a woodworking shop. And another in my own neighborhood used to be an electrical engineer. Yet another was a marketing manager who turned to landscape care, just like a mexican, his services popular in my hood.
But I do tend to agree that generations after the boomer are increasingly less capable with their hands, with the ‘practical education’ focus on medical, finance, real estate and of course tech. People I know in those fields are working longer hours with less hobby time.
Still, I ask who these brainwashers were and who specifically orchestrated all that. I pick on the conservative evangelicals because they appear to me, to have been the ground zero target, with the effects on their culture being egregiously opposed to their core scripture. Are we back to blaming the so-called economist elites? Usually there’s a money trail. What’s in it for them?
And again, why weren’t the boomers more resistant? Boiling frogs? Corrupting the lead lemming? Bad fads?
That generation started with so much promise and much hope heading towards a mutually cooperative future (at least in the west), and wound up redirected towards cyberpunk dystopia, without much in the way of resistance.
nihil obstet
@ Willy
I’m still lost on why smarter people couldn’t counter all the batshit, which other generations, before and after, seemed to be generally more resistant to.
Were other generations more resistant to batshit? Well, the nation reelected Woodrow Wilson in 1916 because “he kept us out of war”, and then became almost hysterically pro-war within a year as the New York banks got worried about their loans to Britain. There have been race riots pretty much since the founding of the U.S. and all over the country, because smarter people couldn’t counter the batshit about blacks threatening whites. A lot of millennials were and still are big fans of Obama despite the massive upward shift of money to the top during his administration with his help.
“Why didn’t the good things of the past continue so they can be available to me” seems to be a perennial source of anger that can be directed into dividing people who need to work together.
And another plug for one of my favorite documentary series, The Century of the Self. I’ve already suggested it once on this topic. It addresses some of your questions more completely than a comment thread can do.
bruce wilder
I’m still lost on why smarter people couldn’t counter all the batshit, which other generations, before and after, seemed to be generally more resistant to.
Making due allowance for what nihil obstet wrote above, the rise of television and the decline of social affiliation (the bowling alone phenomenon).
If evangelicals seem so influential with regard to political culture, it is partly because evangelical church communities are among the few communities still active. The Catholics and Mainline Protestant denominations that formed a local ascendancy in many American places at mid-20th century are sadly depleted, the Catholics particularly shaken. Local business activism (boosterism) goes on, but is overshadowed nationally by business conglomeration: if local restaurants are franchises, local banks branches (and those branches are closing), local retail decimated by Amazon, supermarkets part of the Big 3 chains stocking the products of a few giants like Proctor & Gamble, the scope for boosterism is limited. And, then there are the craft and industrial unions, the Professional associations . . .
To act in concert politically against centralized power requires more than sharing emotional attitudes before a teevee screen. It requires social organization and commitment. It requires cognitive investments in thinking thru issues. And, I think some sense of solidarity with fellows.
Ian Welsh
Comments off. Please use the new open thread.