Stephanie Kelton in action.
Worth watching
What Is Money?Ryan Grim interviews Stephanie Kelton, economic adviser for Bernie Sanders 2016, about MMT by popular demand from our audience. There will be time for questions & answers. MMT = Modern Monetary Theory
Gepostet von TYT Investigates am Mittwoch, 7. Februar 2018
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Thanks for sharing – a great interview. How can information like this get transmitted to as many people as possible?
Would that we had someone in the UK as articulate, experienced, logical, media-friendly and so on top of their game. Maybe there is but not given the air-time or perhaps even unwilling to ‘go public’. If so, it’s such a loss. Prof. Kelton is an inestimable asset to progressive politics in the US.
Inexcusable afterthought. You do of course meet the criteria (well, most of them – lol!). No offence intended.
I have shared a platform with Stephanie and we are in fairly regular touch
She’s cooler than me
I accept that!
And prettier, Richard.
I hadn’t noticed…..
đ
Wonderful!
A brilliant presentation of cool common sense.
@ Richard
Couldn’t get sound with your link for whatever reason but hunted down one that will work for me:-
https://www.facebook.com/TYTInvestigates/videos/what-is-money/1820070581359127/
Stephanie Kelton nails it in the video with one line and its implication âThe governmentâs âdeficit red inkâ is the private sectorâs âsurplus black inkâ!â
Likewise private sector clearing banksâ âdeficit red inkâ is the private sectorâs non-bank âsurplus black inkâ! Both monies swirl about together in the economy in relation to the real resources and productivity capacity in the economy. Itâs the governmentâs job to see this âswirlingâ doesnât result in either abnormal inflation or deflation. A good starting point for government politicians tackling this job is to avoid the assumption the private sector normally optimizes employment and therefore demand because of risk uncertainty in investment. This only occurs in the rare âboom-timeâ periods. Imposing a fiscal spending collar on government from the get-go doesnât make sense because you really have no clear certainty how demand is going to pan out. Equally irrational would be to also impose a private debt created spending collar on clearing banks. Neoliberals havenât quite got the idea yet that economies are fluid creatures that work better with public and private sector spending made to work together!
I think she’s very good at this
But we do discuss how to get this across on occasion
No one has wholly nailed it yet
@ Schofield
Me neither, and when I tried to increase the volume on the vid the screen then went black and this writing appeared on it ‘Video Nicht Verfugbar.’ Why German should appear I’ve no idea, nor do I know what that German actually means; I’ll assume it means something like video not allowed?
Anyway, I clicked on your link and, despite not being on Facebook, could watch it without incidence, German or otherwise.
I have a confession to make. I have the attention span of a gnat when it comes to vids on the internet… I blame Utube! But this American lady is so good I actually watched it without realising it’s nearly half an hour long. She combines those rare attributes of explaining stuff in an idiot-proof way without being in the slightest bit patronising. That’s no mean feat.
The American lady maybe prettier than RM but courtesy of RM’s blog I’ve ordered my 2nd book from the net about economics/politics since March this year. The first being ‘The Joy of Tax’ and the second being ‘Reckless Opportunists’ by Aeron Davis, which turned up this morning.
Can’t remember who recommended reading it but whoever it was said it was only a small book, which it is. But what the recommender failed to mention is that the typeface is so titchy you need the Hubble telescope to read it. Now I’ve got to get some cheapo reading glasses from Home & Bargain before I can start reading it… the joys of getting old, eh!
If anyone had told me a year ago that I’d be ordering such books – and waiting impatiently for them to turn up – I’d have thought they were losing their marbles. Still, it makes a change from reading books about randy teenage werewolves and nephalims with superiority complexes.
P.S. You may not be as pretty as the American lady but I bet she doesn’t build model railways in back gardens as a hobby like you do. That’s pretty damn cool in anyone’s book.
Stephanie is pretty cool at every level
I have never discussed model railways with her though
It never seems to have come up…
Next time, maybe
Just listening to Stephanie Kelton when she answers the question “What was the Gold Standard?” made me remember it was a “fiscal collar” just like the “fiscal rule collar” the current Labour Party leadership’s agreed to. So nothing much changes in Old Blighty does it? Only another 200 years to go and the country might consider abandoning a “fiscal rules collar” that’s if there’s still a “United” Kingdom after a No Deal Brexit!
“A formal gold specie standard was first established in 1821, when Britain adopted it following the introduction of the gold sovereign by the new Royal Mint at Tower Hill in 1816.”
https://en.wikipedia.org/wiki/Gold_standard
Spot on
Positive Money try to do the same thing
I suggest Positive Money are softening considerably under the weight of MMT supporters…
Albeit still, I fear, a bit confused.
http://www.progressivepulse.org/economics/if-we-can-do-it-surely-we-can-pay-for-it
@ Richard
Yep. The UK abandoned the “Gold Standard Fiscal Collar” in 1931 because it obstructed fiscal expansion to get out of the depression. Presumably after the UK has suffered sufficient recession/depression from the Double Whammy of Austerianism and No Deal Brexit the Labour Party will abandon its New Keynesian (aka Neoliberal) fiscal collar. And so it goes a nation of slow learners!
Note the economic golden age ’45-70 (high productivity and wage growth, low inequality) was a gold standard era, and hence a period when a fiscal collar was applied. There is an argument that this was a era of catch up, made possible by the investments in technology during WWII when the collar was off. Still, my feeling is that it not so much the collar that is the most important, rather it is which modes of economic activity are promoted via tax policy, etc. The larger mistake is to favour finance (a trickle up industry) over foundational industries such sustainable energy (including energy efficient homes and transport), and wellbeing (health and education).
@ Charles Adams
“Note the economic golden age â45-70 (high productivity and wage growth, low inequality) was a gold standard era, and hence a period when a fiscal collar was applied.”
I’m not sure what your statement means Charles. Was there not a very high government capital spend during this period relative to a government current spend? I don’t have the figures I admit. I note that Bill Mitchell doesn’t really talk about this in his Part 3 smack down of the Labour Party’s New Keynesian fiscal rule policy:-
http://bilbo.economicoutlook.net/blog/?p=40064#more-40064
Is the Labour Party’s new rule one of hoping that by not putting a fiscal rule on capital spending this will inject sufficient demand into the economy it will result in an increased tax take to close down the gap on its current spend? Also if this is the case high levels of employment and therefore well-being will take the heat off the electorate worrying about the government not balancing its books. I mean it’s not as though voters have this “government balancing” as a priority in their lives it’s having sufficient income flowing in that gives them a relative sense of well-being that matters.
Perhaps Labour’s New Keynesian fiscal rule strategy is an attempt at a double bluff on both Neoliberals and MMTer’s. Yes they’ll be trying to close the gap on part of the government’s spend – current – no they won’t on the capital spend. Both advocates can then have a good old moan the strategy is wrong but what really counts is the strength of demand and the employment rate. Of course, this completely ignores the foreign trade strategy component implications particularly in regard to imports and I have no idea what Labour Party strategy is on this other than one of, of course, we’ll try to rebuild British manufacturing to help reduce the trade gap.
@ Schofield
I guess the fiscal rule is political in that the Shadow Chancellor needs to say that there is one and that it has been devised by reputable academic economists.
Only a few people are going to really worry about whether it makes sense.
You are right that there was massive infrastructure investment during the golden age (roads, power stations, reservoirs) and all these things created growth and paid for themselves (a large deficit can be compensated by a high growth rate). My argument was only that the gold standard did not prevent this happening.
I’d hoped Martin Wolf’s Economics 101 on BBC Radio 4 would at least transmit some of these ideas to some people – don’t know why. (Economics 101 – 27/07/2018 – @bbcradio4 http://www.bbc.co.uk/programmes/b0bbtbcs)
My intro to the whole subject (which I’d sought for years without knowing who to ask what questions) was some episodes of David Graeber’s 10 part BBC Radio series Promises, Promises: A History of Debt – (starting here http://www.bbc.co.uk/programmes/b05447pc)
I suggest Positive Money are softening considerably under the weight of MMT supporters…
Albeit they are still, I fear, a bit confused.
http://www.progressivepulse.org/economics/if-we-can-do-it-surely-we-can-pay-for-it
I hope so
They have had a change of staff
I’m sure we’d like someone who’s on a par with Stephanie over here! I mainly agree with her.
However, the question of the Government running a deficit isn’t quite like she says. The Government’s deficit does have to equal everyone else’s surplus. That’s true enough. Running a surplus means they spend less than they earn. ie They save. But suppose everyone else doesn’t want to save? They want to spend and run a deficit too.
So obviously something has to give if that were to happen. In a contest, it would probably have to be the Govt backing off first to prevent inflation. Alternatively the Govt could raise interest rates to encourage more saving and that would mean they could run a deficit. So I don’t really agree that interest payments are just corporate welfare as Stephanie implies.
Hi Richard,
Just wondered why my comment was still held back? I don’t think I’m saying anything too controversial!
Cheers
Peter
Life gets in the way sometimes
Sorry – there are conflicting demands on my time and if you ask questions sometimes I do not have tome to answer
Re para 2 – there is inflation
That’s the result of competition for resources
But I am not sure why you then disagree with the logic
A govt running a surplus does not create savings. Raising excess taxes destroys that money and shrinks the economy. The result is a smaller economy and less money in circulation in the private sector. A government cannot ‘save’ in the sense that a person or a company can.
And MMT says nothing about whether people or governments should or should not want to save. If the government wanted to meet the private sector’s desire to save they would issue more bonds but that would not constrain public sector spending.
And you need to think what the effect of the government spending might have on the overall size of the economy. If the government spends wisely the economy grows and both government and the private sector can spend more. And remember only the private sector is profit making. So any gains from growth will be seen there. It makes no sense to look for ‘profits’ in the public sector.
‘only the private sector is profit making’. Mariana Mazzucato explains why this is untrue, using the “value added” concept. p245 etc of “The Value of Everything”.
Thanks for posting this link. This is a really great video. Everyone should watch and learn.
Stephanie is really strong on the real resource issues (about 20 mins in) – “You cannot print your way to prosperity!” What government needs to do is invest in people (health, education, R and D), because healthy people (with clean air and a stable climate) and knowledge are the only real resource constraints.
Quite so….