I thought that yesterday's announcement by Richie Sunak would be bad. I predicted that before he spoke. I also pointed out all the flaws in the scheme that I thought he might announce before he got up at the Dispatch Box.
All that surprised me in that case was that he managed to make it worse that anyone might have expected, and that he did not even pretend that this was a way of preserving many jobs.
At least in that respect he was right. My description of his proposal as an Unemployment Creation Scheme is, I think, much more accurate than his own description.
What Sunak did was something so typically British. He took a German idea and copied it, and got everything wrong in the process of doing so. The mistakes included:
- Making this a short term scheme when the German equivalent lasts for two years;
- Making the employer pay a significant part of the cost, which provides them with a significant incentive to make staff redundant, when the German scheme does not do so;
- Making no provision for retraining;
- Including a short term definition of what is a viable job, when government restrictions guarantee that many jobs that have been viable for decades fail his chosen criteria.
What might have been a good idea turns into a disaster as a consequence. The reality is that employers with people on the scheme will be required to pay them at least 66% more per hour than they would pay equivalent full-time employees, and that differential only get worse when the fact that the employer has to pay the national insurance and pension contributions on the government's contribution to pay is taken into account. This is likely to increase the cost per hour by more than 80%. As a consequence the incentive to make many staff redundant and keep a much smaller number of full-time staff is enormous. The whole process completely backfires in its employment retention aim result.
Given that the incentive to make people redundant is now so strong I think we have to presume that a great many people now on furlough will be facing redundancy over the next few weeks. In this context, when I say a great many I mean millions: nothing else seems plausible now.
In that case I think that we have to brace ourselves for the consequences of this happening. Many of these are completely predictable, almost entirely because of the meanness of universal credit. They will include:
- Rent defaults;
- Mortgage defaults;
- Loan agreement defaults, Including large numbers of car loan agreements;
- Utility bill defaults;
- Personal bankruptcies;
- Homelessness;
- Increasing child poverty;
- Substantial increases in demand for public services, many being of an essential nature;
- Significant falls in economic demand across the economy;
- Large numbers of business failures;
- Rapid increase in corporate bad debt;
- The inability of landlords to meet their own loan obligations;
- Falling house prices;
- A banking crisis;
- Economic depression.
And all of this happens for one simple reason, which is that a majority of MPs on all sides of the House of Commons believe that we cannot afford to take on more national debt. For this reason they refuse to consider preserving jobs now as we transition to be the economy we want, with investment being provided now to speed that process of change. Instead they are, in effect, looking for cuts. And the consequence of those cuts is all too apparent, and is laid out in the list that I have made above.
It's the case then that this lack of understanding of modern monetary theory is going to see our economy trashed, and the lives and livelihoods of many laid to waste, with untold harm arising. For the sake of refusing to costlessly create the money required to keep our economy going it is going to be destroyed.
The price we are about to pay for being enslaved by the ideas of long dead economists is going to be very great indeed.
And yes, I will say ‘I told you so' as it happens, but with no pleasure when I know that all of this is avoidable now.
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So let me get this straight, with MMT.
The government can print as much money as it likes and as long as we have unemployment there will be no inflation?
Is that correct?
Unless there is an external shock
Like Brexit
And so long as we have a functioning tax system
I’ve also read that MMT says that as long as we have unemployment, there will be no inflation. I am assuming you agree with this as well?
If that is the case, following the logic through, then why do we need to work at all?
We would have high unemployment, but the government could just pay for everything by printing money and everything would be fine?
And what would we live off Bill?
MMT is deeply grounded in the real economy – not silly stories, like yours
I was making an extension to the logic that MMT seems to reside on.
If there is unemployment, MMT claims there will never be inflation, so MMT says the government should simply print more money and spend it and there will be no adverse effects.
Which begs the question, why worry about unemployment in the first place? The government could simply print money and give it to the unemployed. Once again, it would have no adverse effects according to MMT.
Take it to the logical extension and why does anyone need to work? There won’t be inflation because there will be plenty of unemployed people, so according to MMT there is no limit to the government spending.
Of course, Richard, you inadvertently pointed out the flaw in this plan. Which also looks to me like a huge flaw in MMT when you said “what would we live off?”
MMT seems to think “money” is important, but money is just a mechanism of exchange. It’s the amount of work or value added that matters, and printing lots and lots of money doesn’t change that, which MMT seems to think it does.
It also amuses me that MMT seems to link the supply of something (employment) to inflation, saying they are inversely correlated, but then claims the amount of something else (money) has no effect on inflation, when we know historically that they are highly positively correlated. Not sure how MMT squares this dichotomy and willful blindness, but my guess is because it hides problems in what is obviously a deeply flawed idea.
If you wish to be fatuous I am not going to bother to reply
MMT makes none of the claims you do because it is grounded in the real economy
I suggest you stop making a fool of yourself
It’s really rather pathetic
Literally nothing you claim about real MMT, or what I say, is correct
Bill.
You really do need to think harder about money. There are several drivers for human beings’ development of money. One is the need to create armies and navies to defend your country so governments need to get work out of citizens to both supply and be in those defence forces. In peacetime there is a need also to get citizens to work for government money to deliver non-military public goods and services. So it really doesn’t make much sense for a government to simply hand out money does it?
Two other drivers you might consider are that as money evolved there was a need to have some money creator that could act as a Lender or Creator of Last Resort for when there was a crisis such as the current pandemic or outbreak of war. Usually the crisis is caused by private bankers blowing asset bubbles through reckless lending and these bubbles burst. The Great Depression and Recession are examples of this.
The second driver is the government wanting to use the tool of controlling base rate to regulate the economy so, for example, that has been regarded as a simple tool to control asset inflation bubbles or inflation generally. To do this governments have to be the monopoly supplier of reserves.
Both of these drivers have led to the current Reserves Based Monetary System most countries now use including the UK.
You need therefore to read up about the history of reserves based monetary system development including why the Gold Standard was a nonsense. Human societies are slow to refine their use of money. UK politicians still operate as though the country is on a sort of Gold Standard even denying the government can issue IOU’s even though private banks do using a principle of influx and reflux! This slowness is typified by an Englishman Thomas Tooke writing way back in 1844 to explain why the Gold Standard was a nonsense and the government needed to be able to create its own non-precious metal money so that it could act in times of crisis!
“An Inquiry into the Currency Principle: the Connection of the Currency with Prices, And the Expediency of a Separation of Issue from Banking”
https://socialsciences.mcmaster.ca/~econ/ugcm/3ll3/tooke/currency.html
The development of reserves based money is explained in the following 1993 paper:-
http://www.levyinstitute.org/publications/the-origins-of-money-and-the-development-of-the-modern-financial-system
Thanks to you and others
Somewhat distracted by both work and my mother-in-law dying today
That may also be true next week
The second round of involvement in such issues in too short a period of time
But I guess my sons now have no grandparents left
What exactly and specifically am I saying about MMT that isn’t true, or in fact that you haven’t said yourself? I’ll quote you, in your own words, from this very blog to illustrate my point.
You say yourself in the title of this blog that governments can “costlessly create money”. So I am asuming you agree that MMT claims that governments can print as much money as they want.
You also say things like this, in various articles you have written:
“Serious inflation requires wage inflation, and that is now almost unknown, and with maybe five plus million unemployed likely in the UK soon inflationary wage pressure is not going to be seen for a very long time to come.”
and
[Smith in the Sunday Times] “The only tests of whether a budget deficit is too large or too small [in MMT] are inflation and unemployment. If inflation is low, the budget deficit cannot be too high, and if there is unemployment, the budget deficit must be too low.”
[Richard Murphy on this Blog] “This is true. If money and so-called debt are not a constraint – and they aren’t – then these two issues certainly are. Smith proves as a result that he has understood a core MMT argument, from which it follows that unemployment must always, in that case, be a choice.”
So it seems to me that you agree with the MMT idea that there will be no inflation until you have full employment.
You also have said, on this very same blog:
“And you did say gov’t must control the money supply to control inflation. I disagree. So does MMT”
Which suggests that MMT and you think that printing money won’t have an effect on inflation.
All I have said, is that by taking the ideas that governments can print money, which you agree with and that printing money won’t cause inflation if there is unemployment, which you also agree with, and that printing money doesn’t cause inflation, which you also agree with, then surely that means a government can print money in perpetuity, with no limits as long as thee are people not employed. It also means you agree that supply of one resource (laoubr/employment) has an effect on inflation, but supply of another (money) doesn’t. Which is plain idiotic.
Taking that to it’s logical conclusion, if there is no downside to a government printing money, then it would make sense to keep people unemployed and simply pay them to be so. By doing so you could keep government spending incredibly high whilst at the same guaranteeing perpetually low inflation. The actual level of unemployment wouldn’t matter as you could simply hand the unemployed a living wage for doing nothing, which would have no downside for the government, economy or inflation.
You say I am being fatuous, but I think it is pretty obvious you can’t actually answer this question properly, or at least without resorting to attacking me and calling me pathetic. Which is really quite pathetic in itself.
Just claiming MMT is grounded in the real economy is meaningless. It is a fringe theory at best, and serious mainstream economists from both the left and right have pointed out the many huge holes in it. Not least the above. I mean, if you can’t answer my question properly, with a reason response rather than a ad hominem attack, then what chance do you have of making anyone take MMT seriously. Which I suspect so very few people, almost exclusively on the hard left do. Bil
Anyone can quote out of context and create nonsense
And that is exactly what you are doing
Read Stephanie Kelton
Read what I am about
Literally everything we write about us how to create a full employment economy and yet you think, utterly bizarrely, that our aim is a workless society because money could pay fir everything anyway
It’s nit an ad hominem to call that claim crass
It is crass
Please don’t call again
Richard, Condolences, I am very sorry for your loss.
Thanks
Bill said.
“If that is the case, following the logic through, then why do we need to work at all?
We would have high unemployment, but the government could just pay for everything by printing money and everything would be fine?”
No MMT would not advocate that at all, no sane person would, so your illogical extension of MMT there is a classic example of a straw man argument.
Any MMT advocate I have seen would laugh at your “following of logic”, you cannot have a functioning economy if no one works, that is, creates a good, adds value or provides a service. We could all lie around doing absolutely nothing, but who would provide for all the things that those idle and unemployed people need? Besides if the gov just printed to money “to pay for everything”, who would they be paying? And wouldn’t that create work for someone by extension? So even following your rather tortured logic you can’t escape the fact that a gov spending money has to create work somewhere.
MMT just says that given slack in the economy(like in a recession) and a reluctance/inability of the private sector to create enough jobs, printing money and then hiring people would be a way to create full employment, the issue here is not to print money let everyone sit on their backsides…. I would recommend a much deeper reading of MMT,
Richard. Near the head of this thread you mention that there will be no inflation “Unless there is an external shock, Like Brexit”
Unfortunately it is looking increasingly likely that Brexit will indeed precipitate just such a shock, with import prices increasing as tariffs are slapped on and the pound also slipping against other currencies. So as you say, this might in turn trigger inflation if a positive feedback loop is activated, thereby.
But unfortunately, we must also expect Brexit to precipitate an increase in unemployment as businesses, especially those that export heavily to the EU, fail.
In the event of such an unfortunate confluence, what strategy would MMT advocate?
This scenario potentially sounds dangerously reminiscent of the events precipitated by oil price hikes and the spiraling economic problems of the 1970s (stagflation) only this time, the misery would be self induced rather than as a result of OPEc’s actions.
In essence the precri[tion is ‘don’t fight it’ because you can’t beta a change in the fundamentals
In other words, let exchange rate float, live through the transition, protect the vulnerable, plan for the new normal, work on the businesses that can survive the process of change, train for them
A bit like Covid really
But fight it and the speculators can win in this scenario because the fundamentals are different and MMT is rooted in them
Bill.
It’s clear that you are no fan of MMT.
(You do realise that it is not a theory of what could be, but an analysis of what is?)
What is not clear, is how YOU think government funds it’s spending? How is new money created so that the economy can continue to expand?
Please explain your thinking. It would add to the debate.
“The government can print as much money as it likes and as long as we have unemployment there will be no inflation?”
No it also requires targetting even with high unemployment because there will always be pockets of high employment usually where there’s a quasi-monopoly operating. So, for example, the government may not want to substantially increase the pay of certain specialist public sector jobs. Also money is marked up electronically on computers these days, banknotes, coins, gilt certificates are just hard copies of this process.
What the government does is the same as the private banks it creates IOU’s. If you don’t like a monetary system based on IOU’s you can go back to barter or simply trusting others to reciprocate what you do for them over time. The modern day economy’s benefits you currently enjoy would mostly collapse.
Thanks
“In fact, our standard account of monetary history is precisely backwards. We did not begin with barter, discover money, and then eventually develop credit systems. It happened precisely the other way around. What we now call virtual money came first. Coins came much later …” (David Graeber, ‘Debt: the first 5,000 years’, 2014; Ch.2, p.40).
🙂
I’ve just discovered my elder son has nicked my copy and taken it to university
I suppose I should not say ‘little sod’ but I will, nonetheless
Richard,
Think of it as an unauthorised overdraft or IOU at the (central) Bank of Dad. He is experimenting in credit creation; providing a valuable lesson in applied economics. His ingenuity in finding multiple applications in the use of a text is to be commended.
🙂
Richard, be properly grateful that another 1/60,000,000 of the UK population will have some understanding of money
Bill.. that’s if you believe the assumptions behind Richards beliefs which are untested in practice and in my opinion completely implausible.. but that’s the beauty of opinions and discussion. It is really the underpinning assumptions that need to be discussed and modelled. I would add that there is also no real agreement within the MMT community towards a lot of the assumptions Richard makes. Still it is up to the individual to decide!
Stephanie Kelton agrees with them
Who doesn’t?
Kelton: https://www.youtube.com/watch?v=gcgDazSsyRw
Coppola: http://www.coppolacomment.com/2015/03/repeat-after-me-sectoral-balances-must.html
Of course Stephane Kelton agrees because you have based pretty much all of what you say off the work she has done!!!
Bill Michell certainly is no fan of yours and the same go for many advocates of MMT
He’s no fan of Stephanie Kelton then
I am not much of a fan of Bill
Ben h
MMT is a description of how the accommodative central bank reserve system most countries have actually works. That some politicians and voters like yourself haven’t made the effort to understand it is neither here nor there. There are always such individuals in any society who cause problems for the rest of us through their unwillingness to put in much effort. Even when they are being rescued economically as the current UK stimulus measures are doing they will refuse to engage with the reality of the reserves based monetary system they live under. They are particularly outstanding in their complete refusal to provide any evidence to justify their comments preferring to snipe childishly at others. I blame poor parenting for this mentality!
I wonder if there are ways of getting more coverage of MMT in mainstream media. Although the attitude of MPs and parties to notions like the national debt, ‘taxpayers’ money’ etc etc is dismaying, it’s also not so surprising when there is hardly any serious debate about MMT or indeed any kinds of alternative economics in mainstream media. It’s highly risky for political parties to take up ideas that have very little widespread currency. (I find the Guardian particularly to blame here. I don’t think they’ve even reviewed Stephanie Kelton’s book, and I can’t see them doing anything to promote debate on economics, even though they must be the best-placed centre-left platform to do so.) How about a major event – a mini-conference, or series of 2 or 3, on MMT, with presentations aimed at the media from major MMT advocates, and also with presentations by high-visibility figures such as Paul Johnson and Martin Wolf, maybe others from leading think tanks, on what they see as the problems with MMT, and panel discussion among presenters at the end? Invite and media outlets, stream online or publish online afterwards. I suspect the ideas need to get attention and widespread public discussion before it’s likely that politicians will pick them up.
I can’t see who would organise that
Why not Randeep? He is supposed to be an MMTer and he writes editorials.
This is the sort of thing the IFS should be interested in doing, except they don’t do macro…
Perhaps the LSE?
The difficulty is getting a university to get off its high horse on the issue
Sounds like a great idea to me, Peter. It’s incredibly frustrating how few journalists, even very intelligent ones, seem to be aware of MMT. You can disagree on the details, but the MMT descriptions published by the Bank of England and described by Federal Reserve chairmen are surely unequivocal facts. Yet journalists seem completely oblivious. I studied geology at university and it feels like mainstream macroeconomics is where geology was before plate tectonics was accepted in the 1960s. Science progresses one funeral at a time right… Same for economics?
In terms of organising a conference, is there a grassroots organisation devoted to MMT? Where ordinary people could help organise events, lobby, distribute information, etc. I would be keen to get involved. I’m based in Cambridge.
Very sorry for your loss, Richard.
Robbie
There are a couple of MMT facebook sites
This is the place for such an idea
Richard
GIMMS have been working on this for some time.
https://gimms.org.uk
If the government can fund the process of war (WW1 and WW2), then it can fund whatever is necessary to do to get us through the pandemic. The Tory attitude is you must work to get money, even though huge swathes of them are the parasitic rentier class. The lunatics are not running the asylum. They’ve escaped and are now running the country.
It is all just so utterly predictable that one’s brain aches.
The first comments feeding into the Guardian’s website yesterday were nearly all of the admiring ‘isn’t he good at presentation’ kind, leavened with the odd ‘Gosh, what’s it going to cost?’ supposedly, sagacious query. However, by the time he was having to answer questions, little gremilns of doubt began to show and one could hear the ‘Doh!-like’ (Simpsonian) pennies beginning to drop. – No. Make that farthings – for he was still getting away, even in Channel 4’s evening report, with the panglossian hand-wringing of inablitity to preserve ‘non-viable’ jobs – a tautology of lethal proportions.
This ‘government’ is going to destroy the ‘U’ K in a quite astonishingly comprehensive number of ways. The wasteland is finally coming.
I know I have pointed this out again but it is the simplest and most direct way of making these points clear. Quantitative easing has left a debt in the region of just over £800 billion. Before the Covid-19 crisis struck that debt was around £500 billion. That had been the level since the financial crash of 2008. The money had gone to the banks. Nobody made any effort to try to pay that back. Yet, incredibly, the sky did not fall in.
That is all we need to know about how essential it is to keep this mythical debt under control. It simply isn’t and were nowhere near a level that might cause any problems even in the longer-term.
This is the issue I am working on
Craig.
The major problem is most citizens in the UK don’t understand why the country has a reserves based monetary system and how it works. Indeed many don’t even know they have such a system. This makes the UK a lunatic society because central to such a system is the monopoly issuer of the reserves, the government owned central bank, has no need to be a spender of those reserves other than for its day-to-day running expenses. This simple fact gives the government enormous power to regulate the economy including times of extreme crisis, war, burst asset bubbles, and deadly pandemics. Here is a simple American explanation of their reserves based system which they copied from the British:-
http://neweconomicperspectives.org/2019/10/the-peoples-money-part-1.html#more-11600
http://neweconomicperspectives.org/2019/10/the-peoples-money-part-2.html
Agreed
Hello Richard.
Your scenario surely leaves us in ‘too big to fail’ territory again.
A few people defaulting on their mortgage, rent, or pcp deal is one thing, but hundreds of thousands is another.
The government cannot seriously have so many people homeless at the one time. Where would they all go? Any way you look at the mortgage possibilities, the banks will have to be bailed out again. However the real world issue of where these people go hasn’t been addressed by the government so far. Possible mixing of households under the one roof during a pandemic doesn’t sound too clever. They’ll have to stay in their current homes.
Someone said to me the other day that this is the wake up the country needs for taking on big mortgages, pcp deals and maxing the credit cards. However the pain will not be limited, with prudent people feeling the effects too.
The government will have to do yet another u-turn, and increase the national debt. How they choose to do this will be key, but I suspect it will be inversely proportional to need. The banks and wealthy shall be saved and god help the rest of us.
We are undoubtedly in that territory
Perhaps it was rather unwise of the Government to have spent a decade running down the police and the army? All very well to save the wealth of the Rees Mogg’s of this country but in the scenario described those sort of folk tend to find themselves admiring the view from the nearest lamp post. I don’t think it would take too much in the way of mass unemployment, inadequate welfare (how far exactly does £450 a month of Universal Credit go in London?) and post-Brexit shortages to set alight to the likes of the East End, Birmingham, etc.
Tim,
On the 14/7/2014 at the height of the Scottish Independence campaign, I wrote this:-
https://justinfayresweeklyrant.wordpress.com/2014/07/
While I would like to claim the gift of prophecy, I simply listened to and read the warnings given by better and more educated men than me, discovered the links shown at the bottom of the piece then tried to write a satirical, black comedy piece.
I’m afraid now though that National Service could be the next thing on the Johnson/Cummings wish list – something akin to the National Guard in the US.
I’m becoming more and more convinced that unless a miracle happens the media barons like Murdoch etc will carry on toying with the people of this country the way a cat toys with a mouse – it’s in their DNA.
I’m sorry Richard but I’m becoming more and more disillusioned with Nicola Sturgeon (or should that be Peter Murrell – a la Cummings – the power behind the throne). As an Independence supporter of 40 years standing (since the time of George Reid – in my eyes, the greatest MP this country has ever produced) that saddens me so much.
No, I’m afraid the only hope is for a Vote of No Confidence in the current government followed by a Government of National Unity headed by Keir Starmer.
Yeah I know but sometimes 100/1 shots oblige.
Justin Fayre says:
“No, I’m afraid the only hope is for a Vote of No Confidence in the current government followed by a Government of National Unity headed by Keir Starmer.”
What chance a no confidence vote would pass ? About nil, I would guess with the current government majority in the house. The electorate had the opportunity to pass a vote of no confidence in a Johnson government in December and declined to play ball; preferring vacuous fantasy promises.
Hi Gordon,
Your ‘someone’ really need to read David Graeber’s Debt: The first 5000 years. Their moralizing on debt (debtor morally corrupt, creditor, shining halo) might well change. It is debtors who are keeping the economy afloat. Income = spending and if the income is too low to maintain demand and private borrowing is all that is available to boost income, then those borrowers are keeping people in jobs by shoring up demand.
I had a similar discussion with a friend after 2008 – they are frugal and blamed the borrowers. My friend got pretty upset because of the ‘morality’ around debt. We’re OK now as they are inherently open minded and just needed time to process new information.
And in the meantime we are being urged to “live without fear”. Without fear of losing our job, without fear of being able to pay our rent or mortgages, without fear of becoming homeless, without fear of our businesses going bust and, for those entering the jobs market, without fear of being able to find employment. Easy to say when you have all the waelth and priviliges of a Sunak or Johnson.
Freedom from fear should be the aim of all politics
Dom has set out to increase it
And you have to agree, on this he is succeeding
I fear that you are right, Richard.
Whether or not modern monetary theory is correct in every detail and could be the basis for a different way of running the economy (I think it could well be), the point is that the government (and other countries) have been acting as if they know that it is!
But they clearly want to use it only for putting out the fire that is threatening their ‘normal’ economy. Any suggestion that it could be used for constructive measures (e.g. a revolutionary switch to a sustainable green economy, let alone abolishing homelessness and child poverty) immediately produces the cry that ‘we can’t afford it’ or ‘we already have a debt that will be a burden on future generations’, neither of which they actually believe. Bad economics is being used to justify bad politics.
Well put
Sajid Javid wasn’t prepared to be chancellor unless he had trusted political advisors at the Treasury — ones whose philosophies were compatible with his own. Sunak lacks such support and his edicts for jobs-during-Covid-restrictions appear to be illogical.
Suppose, however, that Rishi wanted the totality of the German measures … and then others feared that they might work so well that the Sunak star would shine too brightly. Could guidance from SPADs have turned into from advice to instructions? Especially as, if Sunak was to become PM, he would probably want different SPADs.
This interpretation would suggest that the German programme had to be filleted of everything that would have made it achieve what is needed. So that, at the end of weeks of arguing, Sunak had no alternative but to go with what has emerged … in the hope that he may be able to modify the regulations later … and that he might yet stay on his perch long enough … to implement some policies for the benefit of the United Kingdom and its people.
“On August 6, 2018, British tax expert Richard Murphy who is becoming increasingly sympathetic to the principles of Modern Monetary Theory (MMT) published a blog post, which recorded an exchange with one James Meadway, who is the economics advisor to the Shadow Chancellor John McDonnell in Britain” http://bilbo.economicoutlook.net/blog/?p=40035
“I am surprised at the hostility that Part 1 in this series created” http://bilbo.economicoutlook.net/blog/?p=40071
“This is the third and final part of this series where I examine claims made by senior advisors to the British Labour Party that a fiscal policy that is designed using the insights provided by Modern Monetary Theory (MMT) would be “catastrophic” and render the British pound worthless” http://bilbo.economicoutlook.net/blog/?p=40064
To accept MMT you also need to accept that you have been hoodwinked by the state for a very long time. A famous writer once said : “ it’s easier to fool people than convince them they have been fooled.”
Mark Twain
Why is it that these blogs have to bring out the economic ‘flat earthers’ like Ben H and Bill?
Can’t they just stay away?
If we were fighting a traditional war, the Government would not be carping about spending its money.
And at least the economy might be undergoing some sort of boom as it went into war production.
So really, this pandemic – or more accurately the complete Horlicks that has been made of dealing with it – is actually WORSE than a traditional war as it has closed the economy down.
Yet the Government refuses to accept its responsibilities in the situation.
I’m puzzled by people like Ben H and Bill. What do they suggest? And as for disagreements about MMT, the Neo-lib Tories cannot even agree on issues such lockdown to rates of Government help.
All that needs to happen is for ANY politician to have the balls to try MMT principles for once, for real. And then we will know – won’t we, whether it works or not?
They are here to time waste
Not only here, rampant false accounts/identities are rife across internet sites:
“This looks like further abuse and a breach of every civil service rule. A series of sock puppet accounts posing as NHS staff. And it’s being done by @DHSCgovuk apparently.
Russian Troll Farm/Cambridge Analytica style dirty tricks, paid for by our money, on us, during a Pandemic” @peterjukes
And directly from the cabinet office too: https://www.politicshome.com/news/article/government-to-launch-fake-news-rapid-response-unit
I have suggested elsewhere that obsessing about Government Debt while ignoring Private Debt is equivalent to worrying about catching a cold during a COVID pandemic. A policy that limits public debt by forcing up largely unmonitored private debt is beyond insanity
Sorry to hear about your mother-in-law’s death. My condolences to you and family.
Even when such things are expected after dementia and long illness they still take you by surprise
Thanks
Richard.
Condolences. Your mother should be a proud woman.
Bernard
Mother-in-law
And my wife and I don’t live together
But we are business partners
And friends
So I get to be involved, quite a lot
Please accept my condolences too. Been there; done that too.
Thanks
Spent the morning discussing music for the funeral
Between a lot of other stuff, I admit
Can I add my condolences to those of the others Richard. Perhaps you deserve a little break
No…..death is part of life, to be embraced
My wife is still tweeting…..so she clearly shares the view
“Even when such things are expected …. …. they still take you by surprise”.
Yes, that must touch a chord for many people. It is, I think the irrecoverable finality, for which we somehow cannot quite prepare. My condolences.
John
Thanks
Tomorrow is funeral planning, which is especially hard at this moment
Richard
Thanks for your answer to my question above. As you say, there is no point in fighting the inevitable (as John Major found out to his cost a couple of decades later).
Your answer also prompts me to speculate whether in one strange sense we could possibly be in a better position this time round (relative to the 1970s) given that for positive-feedback (e.g.an inflationary spiral) to operate, there has to exist a continuous closed loop through which cause and effect can perpetuate (intermittently changing roles during the process). Break the loop and you break the growth (a bit like R<1 in yet another Covid analogy).
In the 1970s the Trade Union movement was still strong enough to partially compensate members for the rising prices they experienced. This was because Unions were able, through collective bargaining, to achieve corresponding wage rises.
But this time round, Unions are probably too weak to respond in this way and members will just have to 'suck it up' and live with a Brexit induced reduction in their real pay.
Consequently, perhaps the deflationary tendency that such action precipitates might offset the original Brexit induced inflationary pulse.
This would do nothing for unemployment of course (except to make it worse) but at least we might evade any inflationary spiral. And this would, at least, still leave the MMT path clear rather than being blocked by a notice board saying ’no thanks: we are now into the realm of inflation”.