Background
The podcast I posted here yesterday, which, admittedly, very few people have watched, included an implicit challenge from economist Will Thomson, who repeated a suggestion he made when he interviewed me at the Scottish Festival of Economics in Edinburgh on March 21, that I might not be an MMT economist. The idea is an interesting one because, on the same day that he interviewed me, Warren Mosler, a founder of MMT, suggested that I was the most successful proponent of MMT in the world right now, and was also the first to stand and applaud what I had to say when my interview with Will that day came to a close.
Nonetheless, this idea that I am doctrinally impure does, I think, persist in MMT circles and is now something I need to challenge, because if MMT wishes to insist upon a set of what I think to be inappropriate policy proposals, as opposed to theories, that supposedly and illogically define what it is, to which you must subscribe if you are to be considered an MMT supporter or economist, then it is a movement that is, I think, in deep trouble and bound for irrelevance.
The long post that follows is, then, of significance because it explains why I think MMT academics are, at present, undermining the very ideas and cause they claim to represent. In that case, if you are interested in MMT, stay with this one and please give it a read.
Introduction
When I was 21, I made a decision that I have never regretted. Having spent three years at university studying economics, I decided to pursue career doing economics.
It is important to note the choice I made. I decided to stop focusing on studying economics and chose to do it instead.
There were good reasons for my decision to train as, and then become, a chartered accountant, followed by a career as both a practising accountant and a serial entrepreneur. I had enjoyed my study of economics, but felt that much of what I had been taught was profoundly wrong. I realised that I could maintain my interest in the subject whilst testing the issues in the real world, and simultaneously do something I felt was more important. This was to learn how to manage a business and deliver good governance, accountability, and transparency, whilst simultaneously learning to make real business decisions so that I could fulfil my ambition, which was always to create jobs.
Nothing has ever pleased me more throughout my career than creating gainful employment for other people. I am still doing that, and the rewards are as great as ever. They are not purely, or even ever, primarily financial. I have never, throughout my career, understood the claim that business people profit maximise, and I have never done so, partly because the claim is in itself both meaningless and unmeasurable. Instead, the reward comes from something much more important, and is based on the relationship between people and the satisfaction of realising that you have helped someone achieve their potential, which I think I can fairly claim to have done over time.
Why this matters now
Why do I say all this now? I do so in the context of my recent podcast discussion with Will Thomson, in which we discussed the role of the job guarantee in modern monetary theory (MMT). During that discussion, Will, who is, I think, well respected in academic MMT circles, said that:
The job guarantee is to MMT what collective ownership of the means of production is to Marxism; it is constitutive rather than optional.
I respect Will's right to make that suggestion. At the same time, I note that what he said by implication was something he vocalised more clearly during our conversation in Leith, Edinburgh, on 21 March. He asked me then whether I really was an MMT economist, and I can only presume he did so because he had already established, in his own mind, and according to the criteria that it appears he and other MMT academics have created, that I am not.
Again, I respect Will's right to say this. Of course, he is entitled to his opinion, but in the same way, I am entitled to say that he is both wrong and profoundly so.
I explained my objections to the job guarantee in the podcast. However, I will reiterate those arguments here before I go on to explain the implications of Will's position and the fact, as I expressed in the podcast, that its dedication to the so-called job guarantee entirely discredits the whole MMT position, in my opinion.
The theoretical error
Dealing with my objections first of all, the first quite fundamental objection is that if MMT is, in my opinion, and as we agreed, now a recognised school of economic thought, it is so on the basis of developing ideas previously expressed in Knapp's 1905 theories on what came to be called chartalism; the development of that chartalist thought included in Keynes's 1930 Treatise on Money, which is the foundation for most post-Keynesian thinking on this issue, and in Abba Lerner's work on functional finance.
Will's claim is that MMT has become a school of economic thinking in its own right on the basis of:
- Its promotion of the job guarantee,
- The promotion of state control of central banking (with which I agree),
- The consequent promotion of a zero rate of interest on central bank reserve accounts (with which, pragmatically, I can only partially agree), and
- The promotion of a Green New Deal, of which I can wholly fairly claim to be a major creator, but which I can also quite fairly state is a policy agenda which can, and I think often does, exist independently of MMT.
To put this another way, Will's claims about what makes MMT an independent school of economic thought rest on decidedly shaky foundations.
In reality, MMT is an independent school of economic thought because it provides an explanation, based on evidence drawn from real-world observation, as to how government funding, taxation, government borrowing, and the role of government money creation impact the economy in ways ignored by all other schools of economic thought. As a consequence, I stress, MMT enables consideration of policy agendas that were previously considered impossible under neoliberalism. But to confuse policy opportunity with theory is a category error, and that category error is deeply implicit in the claims that Will makes, meaning that they are quite literally categorically wrong.
I could stop this post here. I could argue at this juncture that if MMT is properly defined, and I think I have just done that, then I am very obviously an MMT economist. But doing so would not let me cover my further objections to the job guarantee, so I will continue on that theme.
Practical impossibility
Secondly, pragmatically, the job guarantee cannot work. The idea that local authorities or civic community groups should spend their time ensuring that they have suitable jobs available for any person who might become unemployed in their community, so that the person in question might be offered an immediate chance of work, using the skills that they currently have or wish to develop, at a wage that is little above the current minimum wage, and possibly below a living wage, is not just flawed, but utterly impractical. In practical terms, it would require the most phenomenal waste of resources amongst those required to imagine and have available jobs when, with a very high degree of probability, those job opportunities will never be required, and the likelihood that the work will be undertaken is minimal. If anyone was setting out to create meaningless work, this might be its most perfect definition.
Such a proposal would divert large amounts of valuable labour resources away from tasks that need to be undertaken towards the management of remote possibilities that might never exist. And, as Will agreed during our discussion, if a major employer were to fail in a community, the prospects that a job guarantee could actually operate are remote in the extreme. As experience shows, no community can recover from a shock of that sort in the short term, and promoting such an idea would create a political nightmare and a credibility crisis for any politician who tried to claim it was possible.
The wage floor claim
Thirdly, I think the claim that the job guarantee provides a benchmark for the price of labour is not credible in a country like the UK. This might be true in the USA, where the minimum wage is ludicrously low and effectively inoperative, but in a country like the UK, where the minimum wage already provides a floor for pay at which many people are employed, this claim simply does not stand up. The job guarantee claim on this issue ignores the fact that other policy options with greater overall effectiveness are available to achieve this objective.
The risk of compulsion
Fourthly, I fear the risk of compulsion if a job guarantee were introduced, and that risk is sufficient to object to it.
The human reality
Fifthly, I resent the idea that the job guarantee should be provided as a mechanism to deliver continuous employment for those between jobs in the private sector. There are many reasons for this, but in principle, there appears to be an implicit belief throughout the job guarantee that private-sector jobs are valued, and that nothing the state sector can do is worth as much. That belief I think to be profoundly mistaken. It is certainly implicit in this suggestion.
Simultaneously, I think this idea does not sufficiently respect the agency and autonomy of those who are made unemployed, or who need to leave employment for any reason, such as employer abuse in the private sector, and the resulting time that they will require to appraise their circumstances, rethink what they require from employment, and go through the necessary, and time-consuming, process of securing new employment. The reality of all of this is something that the job guarantee trivialises.
We should not expect those who have been made or forced into unemployment to return to immediate employment. We should, instead, be providing a social security system that reflects their circumstances, their need for a continuing and appropriate level of income, and their right to continue living in the home they have. We did once have such a system. The scandal is that we do not have one now.
Let me also be clear: having a job at £15 an hour will not, in a great many cases, meet these needs, whilst the time spent undertaking that job-guarantee based employment might well undermine the prospect of a person returning to gainful employment when the opportunity arises, because it will prevent a person from having the time to search for appropriate work. At a human level, this might be my biggest objection to the job guarantee.
To summarise, then, the job guarantee is not an existential part of MMT, however much some might like to claim otherwise. It is pragmatically undeliverable and exceptionally wasteful of resources that might be better used elsewhere. The economy's potential is reduced by wasting resources in this way. It does not provide the inflation floor claimed for it by some within MMT, both because alternative policies can deliver that outcome and because that claim shows a profound misunderstanding of most modern inflation, which is almost never wage-driven. And the job guarantee does not reflect the lived experience of those who are unemployed. All of these are, in my opinion, profound and fundamental failures.
The consequences for MMT
What is the consequence of this? There are several.
The first is that the claim made for the job guarantee and its constitutive nature suggests that far too many MMT academics have fallen into the age-old trap of both arguing about economic niceties for the sake of arguing, and of also offering neat, supposedly theoretically justifiable, solutions to economic problems that are totally unrelated to the real economy that an astute observer can see that such suggestions conflict with.
By falling into this trap, much of economics has become what has been called a dismal science, proposing theories with no evidential base whilst making prescriptions and dictating policy that have no real-world use. The sad fact that MMT academics now appear engaged in these fruitless and even useless activities is something to be deeply regretted. They are, as I suggested in the podcast, discrediting the whole idea of MMT by doing so and at the same time, are putting at risk the chance that it might deliver on its promise of potentially vastly better outcomes in the real world. That, I think, would be disastrous.
Secondly, by being dogmatic in the way that Will and others within MMT have been on various issues, they greatly increase the chance of MMT being described as a cult, as has happened far too often already. Other forms of left-of-centre thinking, and in particular the various strands of Marxism, have already been consigned to real-world irrelevance as a consequence of their dogmatic infighting, which leaves most people indifferent to the benefit of any claims that they might make. By being dogmatic, MMT academics take the risk of consigning MMT to the same fate. If so, perhaps I am best out of it.
Thirdly, and most importantly, this exercise in theoretical time-wasting totally misses the point of what MMT is about, which is the empowerment of the potential to deliver optimal outcomes within the real-world economy. MMT makes it possible for us to imagine policies of full employment, sustainable resource usage, environments of controlled inflation, the creation of resilience, and lives worth living to the full. Arguing about policy details, such as theoretically optimal interest rates and unworkable schemes to deliver full employment, undermines and even destroys that potential, and that, in my opinion, is unforgivable.
Conclusions
So, what do I conclude from this? The first, most interesting thing to say is that, according to some MMT academics, I am not a proponent of MMT. As a reader, you should be aware of this.
Secondly, you should also be aware that what these academics now appear to want is that MMT be turned into an arena for inconsequential academic dispute, with little or no real-world relevance, which would be a contest seemingly pursued by those who have lost sight of the purpose of economics, which is to effect change in the real world for the benefit of the people who live within it.
Third, there is no chance that I will be endorsing the idea of a job guarantee so that I might be endorsed as an MMT economist. This matters. MMT creator, Warren Mosler, suggested when he also spoke in Leith on 21 March, that I might be the best-read and most social media-noted commentator on MMT in the world, but if I am required to endorse ideas that I consider irrelevant, unworkable, and even straightforwardly harmful to be afforded that status, I would rather not have it. I will, instead, think and speak for myself, as I am here.
So, let me go back to basics to conclude. The foundations for what I think is MMT, to be found in the work of Knapp, Keynes and Lerner on theories related to money, are, I think, broadly right, although as yet the actual nature of money has not, in my opinion, ever been properly formulated, even in the works of people like Christine Desan. There is, then, still academic work to do on this issue, but much more importantly, in many ways, there is a great deal more work to do on a pragmatic basis to deliver the potential that the thinking of those four people, when combined with that of Hyman Minsky and Wynne Godley, can deliver. In the grand scheme of things, they are the people whose work matters, and if a new name is required to explain that school of thought, which would, as a result, leave the term MMT behind, maybe that is a necessary development. I am open to that.
What I will not do is compromise to support those unworkable ideas that Will has claimed, I think correctly, most academic proponents of MMT now think are core to it as a school of economic thought. These ideas, as far as I can see, risk, as a result of their promotion, the chance that MMT will be consigned to being a footnote in history , and that is something I would regret.
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A couple of points………
Rather in the way you like what I will loosely call business I am am member of the local Model Engineers, tell them you want something mended or made and your request will be greeted with joy.
Then of course there is the question of why does MMT need to include a Job Guarantee or whatever? Is it required to make the theory work? Or is it something that has been picked up along the way for reasons nobody really understands.
Finally of course there is what I would call ‘back seat driving’ Somebody comes up with an idea BUT its someone else who has the job of making it work, and their experience and knowledge that can turn the initial proposal into something that works which may be quite different even if it achieves a similar end.
I would agree with your analysis. Will seems to have strayed into a policy area which I suppose some supporters of MMT might endorse but it should not be considered a crucial component of MMT. I would also oppose the idea of the job guarantee. Apart from the logistical implications there are other negative effects. These include compulsion for one. Gaps between employment are part of the process of changes in the job market. What is necessary is a proper support system for those out of work and the creation of opportunities for training, perhaps part-time work for people, opportunities to explore other activities. Full employment should be a goal for government but forcing people to work is not really a good idea. It sounds a bit like a Poor law approach. [Having been part of the generation impacted by Mrs Thatchers economic experiment in the early 1980s, I am well aware of the harmful effects of unemployment and a poor welfare system].
Thanks
To be fair here, no prominent JG proposal ever suggests that it should be mandatory or that people should face compulsion to work. It’s always a fully voluntary guaranteed opportunity for paid work ar a fixed wage. It sits alongside any and all other social welfare policies to support people and does not replace them.
That makes the absurd level of wasted resources to make this scheme work an even bigger potential scandal
Pleased to read this. As an outsider to the academic side my heart sank when i sensed fracturing over a scheme that seems totally fanciful (job guarantee). We desperately need a gentle sort of revolution in economics and politics, and that’s already a challenge without getting bogged down in this. If the conditions are right then opportunity for individuals can be available as and when needed. I’m no expert but thank you.
“The job guarantee is to MMT what collective ownership of the means of production is to Marxism; it is constitutive rather than optional.”
Marx wrote about the way the world worked…. and collective ownership was one policy that has been identified as solving problems that Marx thought inherent to Capitalism.
I am a Marxist in the sense that I think Marx correctly identified how Capitalism works (and its problems)… but I still think that private ownership of many things is a good idea.
I am an MMTist in the sense that it describes reality…. but I don’t think the Job Guarantee is a great idea (for the reasons you outline).
This matters because in the rough-and-tumble of politics we must build consensus, not division.
Agreed
We need a broad church, not a narrow one
Agree totally. The problem that arises now is that the factional infighting has real world consequences. As a Green Party member I’m seeing this in a policy development that dismisses the many MMT-as-description adherents. Unfortunately, the wilder claims of some MMT theorists make it more easily dismissed.
Agreed
Reading this makes me even more convinced that the Job Guarantee thesis has been hijacked by the ‘job-seekers allowance’ brigade which is obviously compulsion – or should I say a form of slavery biased to an idea of people being workshy. Concentrating on the problem of being workshy, when we have a problem with greed (pleonexia), corruption and shortermism is like worrying about the common cold during a small pox epidemic. It is an error of morality – looking at the wrong moral risk.
Are you an MMT economist? I think that you are much more than that, and are better for being so? You certainly do not think in terms of silos. And to make things work along side other things, one does need to range widely – you know – walkabout! An MMT economist? No – that is too narrow a definition of you.
Thanks
A job guarantee, or similar, would also apply to long-term unemployed who want to work, and could be helpful here. People in their 50s or more often become unemployed for various reasons — AI being only one; younger people being cheaper is sometimes another — and stand very little chance of getting another job at all. And many of these people have skills and attitudes which should be made use of. It doesn’t have to be a job guarantee, but another way of supporting such people.
Very quick response as I am onsite at an event. There’s a fantastic book by John Harvey called Contending Perspectives in Economics. It outlines beautifully “what is a school of economics?” He actually does not cover MMT in the book but that is an aside. He suggests that there are core parts that you need to agree with to be a member of the school. So for MMT if you said taxes fund government expenditure you would be chucked out! I don’t think not supporting a JG has that effect. If you didnt think full employment was desirable that would probably see you outside the School of MMT. Not supporting a policy like a JG means you can still be an MMT economist. However disagreeing with so many other people in the school about the JG makes it difficult to “fit in”. Academically speaking. I doubt Richard as an iconoclast will have an issue with that. And of course my final point is that the job guarantee is absolutely essential as a tool to significantly alter the paradigm. Is very practical and has no significant barriers. Apart from the political ones. It is a silver bullet policy, or as close as one could find. Oh actually this is my most important point. MMT MUST have policies if it is to be of use as a school. (Will Thompson) aka William Thomson.
Reply part 1
To use AI, Harvey suggests:
“A school of economics is defined by four interrelated features.
First, it has a common core of assumptions. These concern human behaviour (for example, whether people are rational or socially embedded), how markets function, and what determines value, production, and distribution.
Second, it uses a distinct analytical framework. This includes its preferred models, methods, and forms of reasoning. Neoclassical economics, for example, relies heavily on equilibrium modelling; other schools may prioritise historical or institutional analysis.
Third, it reflects a particular view of economic problems. What counts as an “issue” is not neutral. One school may prioritise efficiency, another inequality, another power or ecological limits.
Fourth, it carries implicit or explicit policy implications. Because each school frames the economy differently, it will also recommend different roles for the state, markets, and social institutions.
The critical point the book is making is this: schools of economics are paradigms, not neutral toolkits. They shape what economists see, what they ignore, and what they think is possible.
And the implication follows directly: disagreement in economics is not simply about evidence; it is about competing worldviews.”
Reply Part 2
Note my previous reply.
You said the JG was constitutive. I note now though that you say I might still be in, but out of step with JG acadamics.
I am entirely happy about being out of step. I rarely try to be in step. I do my own thinking. I am not bothered if it does not align with that of others, although I do seek to understand why: that is how learning happens.
I habve already explained why I think you are entirely wrong on the JG. If that is MMT policy, it’s wasting the world’s time.
Maybe I need to create a new school that might actually address the world’s needs. MMT cannot if what you claim is right.
I also think your claim is wrong. Sorry, but that has to be said.
Reply Part 3
There is a curious irony in this. Our discussion was the worst viewed video we have had for years. People are not interested in th JG. They think it is irrelevant. I think thay may be right.
I don’t like the name MMT. The essence of my imperfect understanding of MMT is the ‘accountancy’ aspect – the ‘sectoral balances’ – that someones deficit is someone else’s credit. It seems perfectly reasonable that MMT might allow one to think about job guarantee schemes – but not that it is integral to it as a theory . …As Clive Parry puts it.<p>
I don’t really understand this:<p>
…’the monetary system’s original sin is that it creates unemployment and that money is a public institution that is launched into existence by creating unemployment…'<p>
Money as a Democratic Medium | The Monetary Case for a Job Guarantee— Pavlina Tcherneva (@PTcherneva), Jan 10, 2019<p>
This seems to be straying into Marx’s territory where money is not only a medium of exchange, but also the means of capital accumulation and exploitation of labour . That seems to be leading to a more complete ‘theory’ of how the economy works over time than MMT claims to be.<p>
A quick search seems to suggest that most of the leading proponents of MMT – Kelton etc all more or less say the JG is part of it – which seems to put Richard into a small minority in the MMT world.. Although when you dip in they sometimes seem to be saying – MMT ‘allows’ a JG rather than JG being integral to MMT…..???????
I have always made clear that, whatever others say, the JG is nonsense, as is the strange view that Pavlina Tcherneva repeats, that by forcing a demand that tax be paid in a currency, money creation creates unemployment. It does not. For example, a person without income does not have to pay income tax. They may have difficulty surviving, but people do, so this is another crass claim, and I use the word crass advisedly.
This argument is only true for a poll tax, and those making the claim do not make that point. I have argued that the logic of this is a strange extrapolation that comes from the so-called Hut Tax supposedly used in some British colonies, an idea promoted by, I think, L. Randall Wray and Mathew Forstater. I have always suggested that if you have to use an example so extreme, you have lost the plot from the outset. This argument has.
This SO reminds me of doctrinal squabbles in conservative religion.
De-prioritise the original “main point”.
An in-group redefine what is orthodox or heterodox.
That group then throw out the heretics.
After a while the orthodox purists fall out among themselves, and split into factions. Return to point 1. Rinse and repeat.
In my religion, the “main point” is what Jesus said and did.
In MMT (I’m an amateur and novice with no theoretical training), I assume MMT to be an understanding/explanation of what money is, where money comes from, and how it works in an economy.
What policies flow from that, is politics. Where people have different ideas – JG, UBI, Taxing wealth, Central bank functions, interest rates, levels of welfare etc.
I can’t see how you can compromise on the basics. Either government & banks create money or they don’t. Either taxes control money supply or they “fund spending”. Either governments aim to control inflation and unemployment or they don’t .
After that, it’s pragmatic politics to urgently deliver a politics of care and an economy of hope.
The “main thing” is not, IMHO, to create an ideologically pure People’s Monetary Liberation Front of Judaea, to fight with the heretical terrorist outcasts of the People’s Judaean Monetary Liberation Front while Fa***e wrecks the economy, 2029 onwards.
I’ve seen how this works in religion. It is literally soul-destroying.
People are dying out there.
All to agree with
And people are dying out there
I did watch the video.
I have been, throughout my working life, an employee (for a while on the top 10% of earnings), self employed, an employer, and unemployed (but only for a max of 2 weeks). I agree with your statement “it will prevent a person from having the time to search for appropriate work”. I treated periods of unemployment as a job in itself, paid for by the government, whose role was to search for work.
Pause for joke – I once employed a young person on the Youth Training Scheme, and someone phoned me up trying to sell a tea making machine, to which I replied that I already had one. “Oh, may I ask what one?” “Yes, it’s a YTS”.
I do not, however agree with either you or other commentators, that there is any element of compulsion in the MMT academics’ JG proposals. The JG is there for those who want to take advantage of it. It does not replace unemployment benefit. As far as I understand it, the JG would not, either, necessarily be at the minimum wage, but at a wage which reflects the skill set of the employee.
That caveat apart, I am entirely with you. Added to which, if a government was organising the economy on the basis of an understanding of the capacity afforded by issuing its own currency, there wouldn’t be any need for a JG in the first place. Albeit there are always going to be upturns and downturns – that’s life whether in employment or one’s health. The important thing is for the government to be acting through taxation to seek to smooth them out, whether by encouraging firms to bring spare resources back into use, or by providing excellent medical facilities.
I’m so glad that you put at the forefront of your arguments the human aspect. Like you, I was born in 1958, so we have seen the same societal changes. My lived experience validates your concerns. After A levels, I benefitted from 5 years of free tertiary education as I dropped out of two courses due to mental health issues, finally graduating from Sheffield Poly with an English degree. I graduated in 1983 at the height of Thatcher’s hatchet job on Sheffield industry. It meant jobs were hard to come by even for English graduates. A ‘job creation scheme’ placed me in three meaningless 6 month job roles which successfully kept me off the dole but did not lead to any career path. Finally, the availability of social security and housing benefit payments allowed me the breathing space to stop working and think. I eventually re-trained as a computer programmer (again a government scheme) and worked for a building society for three years. Unfortunately, I was recruited by a mind control cult and went completely off-grid with them (losing even the NI benefits of claiming social security along the way.) Most importantly in relation to your stress on the human aspect, I was only able to walk away from cult membership because I could claim social security and housing benefits that allowed me to escape and regain my mental health in my 30s. Every one of your objections to a Job Guarantee is valid and demonstrably so. Thank you.
Thank you, too
I have to say I agree with Warren Mosler. Whilst I have read books such as The Deficit Myth by Stephanie Kelton and Money by Mary Mellor (which makes a good stab at defining what money actually is) my understanding of MMT and attitudes to it it is largely gained from your blog and the erudite bunch of regular commenters. Thank you!
Jobs Guarantee fills me with misgivings. Compulsion is lurking in these ideas somewhere. There is a common theme that in order to be a functioning member of society, one has to be employed. “Full-Employment” as an ideal is a good basis for equality of opportunity, but there should be a much wider appreciation of the contribution of ‘idlers and layabouts’ to society.
‘Benefit scroungers’ is a term beloved by the well heeled, who themselves probably derive much more of their income from the various ways they have designed to avoid paying taxes than those scraping a living in the self employed sector or parents raising children, people caring for sick or aged relatives.
Poets, artists, dreamers all have their place.
Much to agree with. Good to see you mentioning Mary – a good person who I have enjoyed conversations with.
You may find yourself a lone voice Richard. I suspect however that it won’t be the first time.
I am used to it.
Will called me an iconoclast. I’ll take that. That suggests I am someone is intellectually independent, willing to challenge orthodoxy, and not intimidated by received wisdom. It means I think for myself. I do.
I watched the podcast! Profound disagreement argued vigorously with mutual respect: if only all public life could be so. I’m still mulling it over.
Thanks
I can disagree with Will and like him.
Plenty of original thinkers born in 1958!
Taking my cue from the The Matrix:
Are you an MMT economist or not? Who cares? Deciding whether or not you are thinking inside or outside someone else’s box is not important. You must simply understand that there is no box. There is only what you perceive to be true and that will change and (if you refuse to be contained by your chosen box) grow with experience, your own thinking and discourse with others.
It would appear that many people in government, the media and anywhere else you care to look have chosen their box, climbed inside, boarded up the windows and welded the door shut.
Good advice
I think Richard that both you and Will agree that a buffer stock of unemployed often formerly employed people is suboptimal. What perhaps you disagree is how to achieve it.
Your thinking is MMT, no doubt there. I am a of a similar age to you and I recall there being more jobs available than people to fill them. The public sector was a big employer and still is.
MMT identifies that the Government needs to provision itself. Is the public sector then, fully provisioned? I suggest not. Perhaps fully provisioning the public sector is the first step and I think this is what you are suggesting. They are properly provisioned jobs that may be full or part-time with normal benefits.
MMT shows us that we can always afford to do anything we want to provided resources exist or can be made to exist.
I think that discussion is good. What you are discussing is so far from the orthodoxy that to divide now would be a mistake. Find common ground and move forward together. Full employment might be the goal by fully provisioning the public sector. In principle this sounds like a job creation proposition. Is it a guarantee? ………. not sure about that.
Have I missed the point?
You have not. You have understood the issues.
I heard the podcast. It seems that there are two threads at work. One thread being woven is that the way money is created and circulated needs a new theory. It shows how, if a country wants to do something then the money is there given the resources are there (Postulate A). The other thread is that given (A) then why not talk about what we can do (Postulate B). Then, postulate B gets to bang on about all nice things that if we voted for them we could do: guarantee everyone a job, build out green infrastructure, stop polluting.
I suspect that economists are not comfortable with (B). What you spend money on is not economics. Economics postures as a neutral science. Problem is, economics is a discipline that is firmly entrenched in capitalism, that is the rules of enclosure forcing people to get a job or find a way to own means of production. So when MMT comes along you end up questioning the very foundation of economics.
Look. We don’t all want a job, we don’t even want money. We want what the money from the job brings, and if we could get that another way most people would be interested at least in looking at it.
One thing we want, though, is inclusion. To feel useful. We need to go beyond a job guarantee because “job” entails capitalism. How about an inclusion guarantee? Included in the products of society and included in the workings? Although you might need to give it a new label. Modern Societal Workings Theory? Modern “Now we have it what do we want to do with it” Theory?
I think you are identifying something important.
MMT does explain how money works. It removes artificial financial constraints and shows that if real resources exist, governments can act.
That is your Postulate A.
Postulate B is then political: what should we do with that capacity?
You are right that many economists become uncomfortable at that point because orthodox economics prefers to present itself as a neutral science, when it is often defending a particular set of social arrangements.
I also agree that employment is not an end in itself. People do not want jobs for their own sake. They want income, security, dignity, purpose and inclusion.
That is why I have increasingly argued that the goal should be broader than a narrow job guarantee. We need a society that guarantees participation, care, education, creativity and contribution in many forms.
I am not sure about your proposed labels, but I think your underlying point is correct: once we understand money, the real question becomes what sort of society we want to build. That is a profoundly political and ethical debate, and one economics has too often tried to avoid.