My birthday present, is a talk with Warren Mosler of MMT fame:
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All I have heard on the news everywhere is that the governments borrowing costs are going up.
It’s the biggest load of bollocks I have ever heard. Lying at scale. A de facto privatisation of the money supply in misinformation only to the public by irresponsible media outlets.
1. The Government owns the bank it ‘borrows’ from.
2. The Government is its own money.
3. The Government sets interest rates not the BoE – if it wants to.
4. The Government is sovereign. If it isn’t, who is?
5. Which entity then is going to be banging on the door, putting interest rates up and asking for money to be paid with menaces? Who? Bondholders – whose money is just held for them anyway because they ask the government to hold it for them anyway? I don’t think so – have your bonds back if you are that worried!
6. The money has not been borrowed; it is money that has been spent into the economy, debited out to UK plc and credited to the accounts of the public sector and private sectors (and even then it is not enough – which is the real issue). It is a record of money gone. Not an un-payable debt! It is essentially investment.
7. The government therefore cannot ever run out of money even if it had to pay these interest rates – which it does not!
If I am wrong then someone aligned with this site please tell me, then I will give up coming here and piss off to somewhere else or just not bother.
I hope that Mr Mosler lived up to your expectations because this Thatcherite bullshit creating fear and justification for exploitation is just getting to be just too much.
You are right.
Warren did unfortunately spend too much time talking about anything but MMT.
Happy birthday!
Thank you
When, where…?
Edinburgh
When I first read his work, I thought ‘this can’t be right.’ Stories of paying the tax bill in cash and the IRS shredding the notes for chicken houses. The chicken house may not be true but I couldn’t explain it away and I came to think his ideas might be worthy of investigation. Stephanie Kelton describes a similar feeling when she first encountered it. When I was much younger I read about ‘Social Credit’ in Canada and New Zealand and even had an exchange of letters with a gentleman in Yorkshire -though I don’t recall his organisation.
I then read Bill Mitchell, saw a video of him debating with Richard and I did not warm to Mr. Mitchell and Richard has explained why he does not agree with him on several counts. There followed a period of reading about Positive Money but didn’t find that fully satisfactory. Ann Pettifor had a good account.
So I was predisposed to Richard’s endorsement on MMT and his explanation. I suspect many will have had a similar journey but the more an idea is ‘out there’ the easier it is to spread.
I hope it is an idea whose time has come and Mosler will be allocated to the list of people who changed the world but not when they first spoke.
Thanks
Please don’t buffer off, PSR. We need your insights and contributions. Happy birthday Richard but can I ask if MMT can be applied as easily in an EU state as it could be in UK? From my limited understanding, I think the ECB and the EU expenditure regulations (including a ceiling to the currently-calculated current deficit) both present a blockage to adoption of MMT by the Irish. Please tell me I’m wrong …
Dirk Ehnts was going to write me a post on that. I will chase him.
Countries that abandoned their own currencies in favor of the Euro cannot, assuming a strict observance of the Maastricht rules, adjust their fiscal policies to take advantage of the insights provided by MMT. British economist Wynne Godley began pointing that out back in 1992, and that’s been consistently echoed by Mosler, Randy Wray, Bill Mitchell, Richard Murphy and many others. However, that posed so many problems to the national governments of Eurozone countries in the wake of the Great Financial Crisis that those rules were, in practice, loosened.
I do not know the details of how those rules were loosened or what is fiscal policy options are currently available to France, Germany, Greece, Ireland, etc. As Richard notes, Dirk Ehnts would be the go-to guy on that topic.
I learned about MMT from Richard, although he rarely used the term and stuck to the fundamentals. For that I will be eternally grateful.
Thanks, Jim
I too learned of MMT from Richard and I too will be eternally grateful!
In 1979, economics was part of an ONC Government course my then employer. a London Borough put me on. I remember nothing about it, other than it seemed to require belief in a series of “fairy tales” about how the the world worked!
best wishes for your birthday – enjoy the day!
Thank you
My guess is that you had this convo with him at Scotland’s Economics Festival, correct?
Yes
If only Rachel Reeves could have been there instead of pumping out lying press releases about escalating debt and the unbearable pressures of having to set and then pay such a high interest rate on Central Bank Reserves to herself, necessitating her having to create less government money for doing the things the government should do.
I wonder if ANY journalist will put the “the household analogy is really bullshit isnt it?” to the duty lying Minister tomorrow? Or at least ask about the rediscovery of the magic money tree – AGAIN!
Dream on…
There were a few spare seats
Happy birthday from a still curious 75yr old. Keep stimulating us oldies!
I’ll try
Belated birthday greetings
Thanks
Happy Birthday!
Thank you.
[…] were also some serious heavyweight thinkers on MMT present. As I've already noted, Warren Mosler was one of those; Patricia Pino was another. Warren shared what I think are new insights on his […]
Belated Slainte from Scotland!
Sadly, only page 1 appears to download of the pdf…I’ll try again later…
When I open the PDF, I just get one page, with title and photo. Is there more?
There is only one page.