Comments by "Curious Crow" (@CuriousCrow-mp4cx) on "Richard J Murphy"
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You as a pilot are not the norm. The vast majority of people have no idea of Crew Resource Management. yes, I watch Mentour Pilot's videos as well, so I know that certain personalities increase the risk of accidents and deaths in the workplace. Most professionals in risk critical professions would know that, because their professions have learned from the tragic lessons of the airline industry. But most of your passengers don't have a scooby doo. Culturally, socially, and psychologically, they have no idea of the active effort needed to keep them safe. That's why certain passengers are rude, get drunk, are aggressive, complain about having to wear seat belts, and still attempt to smoke in the toilets, all while in a thin metal tube in the sky... They don't realise what could go wrong until it does, because they don't see the effort, or look under the hood until things go wrong. Government is another thin metal tube in a different context. Effective government should work to keep things working so that everyone else can live effective and productive lives. And we don't pay attention to that until it doesn't. Now, that also applies to people who think they know better, or are impatient with checks and balances, or just want what they want, and to hell with the consequences. And when you let the lunatics take over the asylum, you get chaos. You get destruction. Reality is a harsh mistress. Bury your head in the sand for whatever reason and she'll kick what's above ground until you pay attention to her. And the temptation is always there, and becomes acute when things don't work as they should. And nobody is immune to this, because it's the way our brains evolved. Taking shortcuts, limiting input, and biases all save limited processing power. The best of us learn to think and pay attention, and not rely solely on our fears and anxieties to solve problems, but to think their way through important issues. But it's hard to pay attention to the issues of 300 million people, so we delegate that tho state and federal government, and if they're distracted by perverse incentives, flattery, or folly, the Swiss Cheese Model explains what happens because of poor communication, neglect, or folly. When things start to go wrong, there's always going to be some bright spark to game the system, or to abuse it, especially where there's money to be made. And deals are done, and life goes on. Until it doesn't. Everything now in the Trump administration is designed to distract or deflect from the real task of Trump and his acolytes, which is to raid the cookie jar. And Trump is only the gateway drug to that. We are living in a dark experiment where our millionaires and billionaires have taken over the plane and are pushing the envelope of how much they can squeeze our of it. And they're wearing parachutes, but everyone else is not so lucky. And, there will be others after Trump, who will try harder to break the system for their own gain. Until we pull our heads out of the sand, and take democracy seriously again. It's like a garden. You might employ contractors to look after it, but you have to get professionals in and refuse to hire cowboys. Stop voting for people you wouldn't lend money to, or let them give your pretty daughter a lift home. Stop settling for less. Demand the best, or get the worst.
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@TheGalifrey Respectfully, you are incorrect. The EU is our biggest trading partner. Spending it on shared projects means technology and resource sharing, which makes up for the loss of capacity and expertise caused by nearly 2 decades of Austerity. If we go it alone, it takes longer, costs more, and keeps us away from technological R & D we could get access to, which is counter-productive, as well as earnings. It would stop the rot of austerity turning to an incurable cancer, limiting growth in our economy forever, because it would allow is to rebuild capacity in production and R & D quickly. We haven't got the time to be precious about it. Everyday we mess about, the fundamental factors that can improve the welfare of our our people are being eroded by the folly of Brexit, and our inability to curb human greed. We don't have time to be precious.
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@Brian_Equator That's only in theory. In practice, cartelisation and monopolisation are more common than you suppose. Just a little test from the School of Economics by Walking About. Just check how many companies dominate consumer goods manufacturing. Washing powder for instance? Airlines? All the big industries have major players that are 5 or less in number who control the majority of the market. So much for competition. Then there is crony capitalism, where a certain sector dominated by a discrete group. In theory, competition is supposed to drive efficiency. But in practice, competition tends to be avoided, because direct competition means death. Corporations don't like dying, just like the people that make up these organisations. Instead, they seek market power in order to build moats around their businesses and prevent competition. It's why we have trade wars at the moment. It's the desperation of big fat cats corporations with schlerotic and uninnovative enterprises trying to protect their gravy train, by shutting out competition. And even when they have a big moat, like Boeing, the squeeze every last penny out for the shareholders mentality, throws the gravy train off the rails. I mean, going bust to build yet another Airforce 1? You couldn't make it up. This is why neoliberal economics was and is a busted flush. It's a cultural and economic failure, as can be seen by the desperate drive to deregulate everything as though you can't make money by providing what people need or want. Or, your business can't survive unless it's labour costs are subsidised by the tax payer. Or, it's easier to make money ripping of your customers, or engaging in stock market pump and dump schemes. And instead of holding up their hands and admitting their parasitic behaviour is breaking the social contract and destroying economies from the inside, they want to double down with the assistance of technology. No; in reality corporations do not want competition, they do not welcome it, and they spend time and money crushing it, and getting government to help them. And we suffer the consequences.
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You're not taking into account the problem of tarrifs being an imprecise tool.
Firstly, 60% tarrifs on China, will not hurt them, because they will just cut prices and increase exports elsewhere, whilst issuing retaliatory tarrifs against the US. And that will undercut US export prices elsewhere in the World.
Secondly, global supply chains are heterogeneous - people buy components from where it's cheapest everywhere, and then manufacture finished products, and export those. These may be multipart components, and how is anyone going to tell how much of a component is Chinese? So, global supply chains are directly and indirectly dependent on Chinese manufacturing, from beginning to end. Direct imports from China thst are 100% Chinese are easy to identify, but those that aren't are not. And a blanket 10% tarrifs for non-Chinese imports will not escape retaliation either, hurting US exports. for anyone country not to retaliate would be political suicide for their governments. So there will be a backlash which will cost US exporters dear.
Thirdly, by causing inflation, the cost of substituting those goods that are tarriffed will hurt US consumers who don't even buy Chinese goods, as the cost of their borrowing will increase alongside their spending because the Fed will impose blunt force trauma by hiking interest rates. That's a doom loop in the making.
If tarrifs are used selectively, US manufacturers may still offshore to anywhere but China. The US cannot compete on Labour costs, and tarrifs will create greater cost differentials, forcing more offshoring.
Nobody negotiates with a gun to their head. Tarrifs create Trade Wars and black markets. This isn't the 19th century when the US was a developing economy. It's the 21st century, and the US is a developed economy. And Tarrifs right now, are going to hurt the US more than it's going to heal it. It's an expensive face saving exercise.
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No. You don't understand. Money is two things. 1. A measure of value, and 2. A commodity. The government can never run out of money, because it is literally as someone else before says like a carpenter running out of inches or centimetres. What changes is not the unit of measuring value, but the perception of the value being measured. Why? Ask yourself why since 1971, bus fares that were £0.02p then, have now inflated to £2.00 for the same journey? What has shrunk is not the measure - 2p is still 2p, but the prevailing belief of the value of what is being measured. This goes back to how money is now mostly credit - from the Latin "credo" meaning "belief" rather than just "currency" i.e. a medium of exchange. You can see that nearly 95% of all money in circulation is now bank credit, with the remainder being physical cash, or central bank reserve credits. So, one cannot run out money. Rather, we can run out of belief it is worth anything.
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Oh boy, could the Bank of England make life better. By reconsidering the cost to the economy of paying interest on Bank Reserves, which is more than £40bn a year that is being paid to banks to do something that they have to do by law already. Together with cuts to corporation tax pushes up the money being transferred to the banks by the state closer to £50bn a year, which is about 33% more than was being spent on Education (£37bn).
It's simply unsustainable. We have children living poverty going up year on year, but the State is financing bankers' bonuses, perhaps in an industry that is socially and perhaps economically dysfunctional. Why can't the banks stand in their own feet, and operate without subsidy? They used before 2006, and we never heard of bankers children suffering from diseases of deprivation then or now.
This policy began in 2006, and now nearly 20 years on, there is no sign of this stopping, but it's Unaffordable. Is this a protection racket? Or What?
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If the rational part of the human brain is a duvet cover protecting a larger mass of emotions, memories, and survival instincts, the mere existence of the cover is not enough to keep the duvet underneath from getting twisted up. Thus Alexis de Tocqueville argued that people feel more than they think. If the brain was a set of siblings, the prefrontal cortex is the baby of the family, and easily overridden by the older siblings in evolutionary terms. That's how it goes. So we need a cultural change in how we manage that.
We need to go slower, not faster. We have to accept that facts are not always objective, and that things that can't be measured matter too. We have to educate people for life and not just work, and teach them not only how their brain works, but it's shortcomings too; how to reason, and how to manage their emotions.
We've been so busy striving to get rich, that we did not know we were impoverishing ourselves at the same time. If people were taught the power of an experimental mindset, we would be less prone to being deceived by our biases, and we would be better off and happier too. Of course, this is a ideal wishlist. Nobody in power is going to adopt that. But there is nothing stopping the bottom up doing for themselves, because peace of mind in the midst of uncertainty, is true wealth. But at the same time accountability must be at the centre of our collective systems. We are, after all, stewards for thise that will come after us. We can satisfy our needs and wants in the present, but not at the expense of the future. So, we must see and think of ourselves differently. Because if we don't, they're are those like Musk, Thiel, and Trump etc., that want to do the thinking for us. And the fruit of that tree is bitter.
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Absolutely. The human brain evolved in stages, and the survival and the relationship building sectors are the oldest parts of the brain. The irony is that the prefrontal cortex, which we tend to lionise so much, is the youngest evolution, and the weakest, it because it's arguably not essential as the older part for our evolutionary task, which is to survive long enough to produce and raise young. The prefrontal cortex increases the odds, but it's not essential per se. In this respect, if you imagine that the older parts of the brain are a duvet, and the prefrontal cortex is a duvet cover, you can see what the relationship is between them. The duvet is essential. And the duvet cover enables it to perform better at its job, but is of itself, no substitute for the Duvet. But it keeps it cleaner, and stops the duvet from getting twisted up or lumpy, which reduces its effectiveness.
Elon doesn't know what empathy means or really does. And know the very little I've heard from his parents and about his upbringing, I suspect I know why he doesn't know what that is. He was born at a time where autism wasn't as understood as it is now. And his parents did the best they knew how, but he needed more than they could give them. And we see the results in his behaviours. And the joke is, if the world did not feel compassion for him, he wouldn't be where he is now. He doesn't want to acknowledge that. And that's sad.
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Sir, I have lived to see the price of a one-way bus ride into my city centre go up from 2p to £2.50, and for my sins I have lived through the time you speak of. And until the 1970s things were better than they are now. You could go to the shop with a green £1 note and come back with bread, milk and marg from the local shop and still have change. Now, you would be pushed to buy a decent newspaper with that. Yes, there were bad times, but as I found out when I studied British Economic History and then went on to look at British Political Economy and studied finance, I realised that I could not see at the time what really was going on. It would be quite easy for the uninformed me to see things as you did. But the data does not lie. Looking at the economic data, Neoliberalism's greatest achievement was to entrench the largest transfer of wealth to the already asset wealthy from the working class. They totally moved from a mixed economy where there were a greater variety of jobs for all abilities, to an economy dominated by financial services and the service industry which makes up around 85% of GDP. Great when times are good, but utterly useless when the whole global economy is based on absurd ideas, leading atrocious policies, and even more corruption. Hence the atrocities being committed on the sick, the poor, and the unlucky. And then the working man, and the family are going in the samr direction. Neoliberalism is a busted flush, because the financialisation of everything empoverishes everyone except the asset wealthy. Now our young people are being cheated out of a decent future. Because of that folly, the economy is being hollowed out. And AI will be the next coffin nail in the workers of this country. We're going backwards with diseases of poverty resurgent, our children are less well fed, and life expectancy has stalled. I walked up 13 floors in the dark during the power cuts due to the 3 day week, but I was more secure then, than I am now. That's why people are rioting. They are fearful, angry, and resentful because they are more insecure than their parents. And until Neoliberalism's cult leaders finally wake up to the fact that their ideas were unsustainable, things will not improve. So, would I go back then? Yeah. I'm not richer now. But I would have had a better quality of life then than now.
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Are they? How do you know that? You do not know how old some of these government bonds are, and you obviously don't understand percentages. We still have bonds from the Napoleonic War period still being serviced today. The coupon rate on these are like 2% or 3% on a £100 bond. So the annual cost is still £2 or £3 per year. In the early 19th century that would have been a huge sum. Now, in the 21st century, you can't even buy a sandwich for that amount of money. Check for yourself. There are inflation calculators online for the UK, based on the Bank of England's database. Mine which calculates from 1800-2023, tells me that £2 in 1800 would have the purchasing power of £218.70 today, but the UK government still pay 2% on a £100 bond from the 1800s, as the coupon is a percentage of the original bond. They are not inflation protected. This is simple liability management. So Starmer isaking a political choice, and not an economic or financial one. Governments are the only institutions who can borrow on this basis, but Starmer has misreperesented the reasons why he is against privatisation. Starmer hasn't taken the King's Shilling: he's taken his donors' shilling. Corporations and plutocrats court whosoever is in place to be in government, and Starmer isn't politically canny enough to play the game to his advantage. He's using the state to keep his donors happy, and not the electorate. But tbh, he's no different to anyone else in doing so. Read "The Dictator’s Handbook: Why Bad Behavior is Almost Always Good Politics (2022 expanded edition)" by Bruce Bueno de Mesquita and Alastair Smith. It should put you straight about political imperative.
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MMT is a description of "what is."
The Job Guarantee is something that some people think that Government "ought" to do. Therefore, they are two different things. Just because some of those who accept the description MMT offers, then go on to argue that Government "should" use its money creation function to give jobs to everyone who wants one, is nothing more than a policy recommendation based on the beliefs of the people who are promoting it. It's remains nothing more than a belief that other might find attractive or be threatened by.
Although it is often very hard to do, we need to be careful not to conflate "oughts" with "what is." That sort of approach leads off the certain road of facts, into the less certain road of beliefs, and ultimately ideologically driven debates. We see this now with the tendency for the footballification of ideas. Ideas are supposedly binary, when as we know that that they tend to run along a spectrum. So the Job Guarantee debate is about whether one is a necessity, and if it is, how one should be funded. This bleeds into the debates about what the role governments "should" have in the economy. And of course, the current illusory binary is "small" vs "big" government, and that debate goes away whenever there is a crisis, doesn't it?
Follow the solid path of established facts, and then on policy, inform your opinion by analysing the arguments.
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Because they can't use their currency to buy US Dollars, and they have no liquid assets to sell for US Dollars.
One thing people don't realise is that having access to US Dollars is essential as it is the currency that all commodities are denominated in. So you have to pay in US dollars. If you don't, you have to pay more to cover the cost of exchanging your currency for USD. In this sense, the US dollar is "International Money" as it is accepted everywhere at its nominal value. This has been the case since the end of World War II. In the decade after World War II, the US had capital controls, where US Dollars leaving the country was strictly limited. Europe including the UK found it difficult as the only USD in Europe was the balances left from the Marshall Aid programme, and these weren't enough for a continent rebuilding after the war. This meant difficulties in buying food, energy, and goods. And the US arguably used their control of the supply of USD to drive forward it's foreign policy. The UK and France would run into that problem when they conspired with Israel to invade Suez, which the Egyptians had nationalised. The US used the shortage to apply pressure on UK Prime Minister Anthony Eden and France to quit Suez, or face a Sterling crisis. He had to agree, and it cost him his job.
Accordingly, in Europe including London, a trade built up between the private banks holding deposits of USD and countries and multinational companies needing USD to buy commodities. It was so profitable, that it became the basis of global money creation being outsourced to Banks rather than governments. But that's another story for another time. Hope this helps.
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The Temptation of "The Plumb Pudding" is still the same, whether it is served at the end of the 18th century, or the start of the 21st century. It is most tempting as fast food, for regimes too lazy, inept, or arrogant to create economies that work for everyone in them, for both rich and poor, thus driving their economies into stagnation, or mere despots' envy. And they try everything bit doing the right thing. In either case, until some semblance of sanity reasserts itself, we are where we are.
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Unfortunately, Richard I'm not sure the import of your message has really hit home looking at the bottery in the comment section. The message that you are trying to get across is that economic deprivation fosters mental ill health in neoliberal economies. Remove the economic deprivation - which is the result of the misallocation and ineffective and inefficient distribution of resources within neoliberal economies - and societally-wide mental ill health will signifucantly decrease. Humans love stories, but their no substitution for the truth. Myths dominate our thinking and are relentlessly and neoliberalism's biggest myth is that money is wealth, and that those who do not have money, who are poor are to blame for their poverty. This myth is built on another myth - that being wealthy is a sign of virtue or talent. And the people who push this myth are often the asset wealthy, who spend their money buying media outlets to push these lies. The truth is that both cream and sewage float to the top. Luck as inherited asset wealth is the reality, and how deeply embedded this myth is in our culture, is reflected in our obsession with class, and other ways to "divide and rule". There are hard working, talented people who never get asset wealthy, or even enough money to live. I'm thinking of Robert Tressell, the author of the novel "The Ragged Trousered Philanthropists." Tressel was an Irish migrant working as a decorator, who wrote his novel at the kitchen table at night. Poverty ensured he never lived to see his novel published, as he died of Tuberculosis, a disease of deprivation, before his daughter got it published. This all happened at the beginning of the 20th century, and yet in the 21st century we're repeating the same myths and the same mistakes as were perpetrated in the early 20th century. And the world is in some ways even more malevolent than the 1910s. We have forgotten the lessons people in this country at that time learned, because the problems they were dealing with, are still being fought with in the 21st century. And in many ways, we are in danger of going backwards. That's what people don't realise, that we've been here before, where the asset wealthy were unperturbed by the loss of the poor and deprived. Qui Bono? Who benefits from that? It may have taken two world wars and a global financial crisis to persuade people to look at things differently, but at least they walked around and examined the elephant in the room, and decided to clean up the growing pile of poop. We're not even really looking. Intergenerational forgetting? Probably, and we're self-harming the fabric of our society as a result. And increasing mental ill health is a symptom of our neglect of the basic realities of running an effective economy. For it to be effective, capital - social and economic - can't be hoarded by a minority, at the detriment of the majority, because it's unsustainable in the long run. That's why we are endangering ourselves. And a those suffering from depression and anxiety are exhibiting a sane response to an insane world, where the winners spend money to gaslight everyone else. Reality can't be ignored, because that way madness lies. I hope we wake up and start resisting the myths and the lies, because it's not only damaging the economy, it's damaging us as people.
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Redistribution is the only answer because there are perverse incentives at work. And tax incentives together with using taxation for productive investment would do that. The State can do it when the private sector won't or can't. If we tax speculation more and provide tax credits for productive investment, we would find asset bubbles would recede. Indeed, there is a tenable argument that tge financial sector is too big. When you look at which sectors contribute most GDP, it's not the ones that provide the most jobs. Financial Services is the largest sector, but it's making only a minority wealthier. Manufacturing employs more people, but provides less GDP than Financial Services. This is why we need a different economic framework to work with. One that looks at productive and speculative input and output differently, instead of being misled by the aggregate. Indeed, we are told we are the 6th richest country in the world by GDP value. But by GDP per head we are 29th richest. And the Labour Share of GDP - the share of GDP paid to workers - has been falling in size for years. But nobody noticed because they had new toys to play with like more consumer credit, credit cards, cheap white goods that were so cheap because the countries making yhem were being exploited. Now it's very different, because as Richard noted the winners from that period, who got wealthy don't even invest here. So, we need to look at things differently and less opaquely, so people better understand what's really going on.
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I think you are obsessed with it, because you're ignoring a very simple fact, that the wealth of the middle class is disappearrung, because the value of their wages and their home is being encoded by how neoliberalism works. It's a parasite, whose mode of survival is to transfer wealth to those who control the financial system. And the middle class no longer do that, and the assets they do own are in real purchasing power being devalued. Most of them have only their jobs, their houses, and their pensions, to counterbalance the puke of debt they took on to pay for it, and the hope they can repay all that debt is disappearing everyday. Why do you thing social mobility is disappearing even for the middle classes? And AI will drive that reality home, because it's the white collar jobs that the aspirational middle classes want that will be targeted by it. So, your confirmation bias is blinding you to the reality of the economic apartheid that is a feature of Neoliberalism and not a bug. The wealth illusion for the middle classes is going to be a painful wake-up call, because it is. The only assets growing in real terms are debt-based assets. And it is the owners of debt who are the real winners, and not the middle class who will lose what they have as much as the working class has already. When AI kicks in within the next generation, if neoliberalism hasn't been moved away from, they will be poorer too. That's the irony. There will be even less social mobility. And what if the middle classes then?
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It's understandable to feel unsettled right now, as the reality of our current system may differ significantly from what we once assumed. If we take the excitement surrounding AI at face value, there's a real concern that many white-collar jobs could be eliminated under capitalism. So, what can we do about this? It's crucial that we encourage our children to work to live, rather than live to work. They should learn to think strategically for themselves, rather than relying on external sources for what they cannot provide. The opportunities that existed in the 1970s are fundamentally different from what we see in the 2020s, and this economy is unlikely to return to those times. Therefore, we need to prepare our children to be adaptable and independent thinkers rather than trying to force them into rigid roles that no longer fit. If their sole focus is on securing employment, it’s important to note that self-employment stands as the only truly guaranteed path to lifelong work. However, the journey of self-employment is not without its challenges; it demands self-discipline, foresight, curiosity, and courage. While success or wealth isn’t guaranteed, the foundation of employment is still there for many. With the right priorities in place, a fulfilling life is indeed within reach, as it is these priorities that enrich our very existence. What is more significant than the external chaos is what brings meaning to our lives. This journey also encompasses taking responsibility for yourself and your loved ones. Although a job may offer less responsibility, we must acknowledge that true security is becoming increasingly rare, as capital continues to replace human roles with automation. The jobs that remain may be those beyond the reach of AI or robots, and there are valid concerns about whether they will provide a living wage. Thus, even within this context, we ought to approach our circumstances with an open mind; harbouring resentment over these changes can often be a futile exercise. Until humanity finds a way to either reform or replace capitalism with a more sustainable alternative that meets our material and other needs, we must learn to adapt to the pressures of the current system.
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Not really, it's not economic. It's financially correct, and stopping land becoming a speculative asset, or a financial instrument is better for farmers and for consumers in the long run. Truth be told, the idea that we can import from everywhere across the planet cheaply is becoming untenable. Would you rather your money went to British gamers or the shipping companies that are hiking their transportation costs? Simply, food is going to cost more due to a. Climate change, b. Geopolitical tensions, c. Globalisation failing. So, we need food production to increase, and not land being used as tax avoidance schemes. So, getting the asset wealthy to stop buying land and forcing up prices, would be a bet benefit.
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There are two types of theories:
1. Theories that describe what is as factual maps of reality (facts) and
2. Theories that prescribe what should be as ideological arguments in frameworks (beliefs).
MMT is a descriptive theory and not a prescriptive theory like Keynesian Monetary Economics.
MMT and Keynesian Monetary Theory share only the description of how the government can issue its own currency at will, and how the level of taxation relative to government spending is a policy tool that regulates unemployment and inflation. After that, they disagree on how these powers should be used.
Keynesian Monetary Theory argues that government money creation should only be used as a temporary fix to address acute unemployment and underinvestment in infrastructure, and predicts that there will be inflation problems if carried on for too long.
In contrast, MMT argues that Keynesian Monetary Theory ignores the role taxation plays in controlling the money supply and curtailing inflation. Therefore, government money creation can be used for acute and chronic underinvestment in the economy as long as taxation is employed to remove excess money from the economy when inflation occurs.
In short, Keynesian Monetary Theory ignores taxation as a monetary policy tool, while MMT does not, and argues that it can be used in a targeted manner to control the money supply and prevent chronic inflation.
So, your critique ignores the following:
a. MMT ≠ Keynesian Monetary Theory
b. MMT is more accurate in its descriptive map of what monetary tools are available to the government than Keynesian Monetary Theory.
c. Describing What is ≠ arguments about what should be.
d. We already have empirical evidence of the impact of government money creation during times of underinvestment, and the impact of taxation. We have:
- historical accounts of how the UK handled the financing of wars and pandemics, what tools were used, and the results.
- data from other countries since the post-WWII period of economic performance regarding GDP per capita, inflation, and levels of taxation.
All these are available online, and the data reveals that MMT, as a framework, may have a point. High taxation does not correlate with economic underperformance as expressed by GDP per capita. Indeed, to give a complete picture, it is essential to look beyond simplistic "straw man" arguments and consider the data. And even more importantly, we must have the courage to embrace nuances. Like underinvestment in infrastructure is economic failure, which can lead to unemployment and inflation because of the consequences that follow on from market failure. That more, isn't necessarily better. And excessive speculation, and rentierism has negative consequences for economies, because they divert investment away from the production of goods and services that are needed to maintain a functioning economy that can provude materiall growth for more than a few.
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I'm sorry but your prejudices are showing. You are blaming a cog in the machine instead of the bright sparks who changed it's design. HR unsurprisingly are employees who are there to protect those who are running the business. They do not get to decide how that that should be done. They are told what their priorities should be, and will lose their job if they do anything else. HR does not get to define anything operational or what priorities should be pursued. Consequently, you know get a lot of employers bending the rules to get what they want, not what is the right and fair thing to do. Rather, poop always run down hill. HR is just trying to keep their job just like any other department. Fail to do as they are told, and they too will be unemployed. So expecting anything more from them is naive. It is the people who have the power to set the priorities of that organisation who are to blame, and they are as much enculturated by a set of incentives that do not put customers as the highest priority. Rather it is profit, and shareholder primacy which together are the demons that are possessing the minds of those people running enterprises. Since the Neoliberal world view has become preeminent, we now promote the creation of inefficiency to ensure everyone one but the employees and Middle and lower management gets their cut, and in turn, nobody challenges the follies being perpetrated. Corporatism is the handmaiden of Neoliberalism, and in short, it's a scam. It's a squeeze, where customers and society at large become resources to be exploited rather than be maintained or served. Is it inevitable? No; but as long as we tolerate it this parasitical relationship between corporations and society, things will only get worse. In extracting as much profit from the process, corporations are becoming more parasites, than protectors and maintainers of society. Indeed, the UK is being run more like a extraction colony of some unseen empire everyday for the last 50 years. Consequently, living standards for the majority have stagnated or collapsed, and productivity has declined relative to our rivals. But we've got more fat cats more than ever. Go figure.
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Actually, that's your bias, and not reality. If the Republicans wanted to help tax payers, they would make the Tax System simpler, use AI to automate it, and remove the need to use tax specialists. That alone would reduce costs to taxpayers and the government, which would reduce the need to increase taxes in the first place. Funny that no-one suggests doing that. Instead, they're leaving the labyrinthine tax rules in place, which help wealthy corporations pay less taxes, and dumping more of the Tax Burden on the assetless, and the asset-limited. That's going to work out well, isn't it? Just like the Portrait of Dorian Gray. What was stuck up in the attic of the American historical consciousness - that it was designed as a factory to turn suffering into gold - is now out and proud in its nastiness, because there's nothing left outside the attic except the American people to reenslave. The economic and political norms of Imperialism and colonialism are coming home to the American people. And it's going to get ugly over the next decade or so.
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I think you are mistaken. Leasehold is the problematic land tenure, not Freehold, which is held free of any charges to a landlord and can only override by The Crown. Not knowing that is strange, as anyone buying a home would know the difference. And it leasehold is not a tax, but rent for the right to occupy and use land for a limited time. It's a form of subletting a freehold owned by a landlord. Is it a scam? Not really, if the costs are fair. But the lack of mechanisms to challenge assessments and to ensure that the landlord fufils his obligations under the contract creates the possibility for extortion. Also, the sums demanded to extend or renew leaseholds when close to the end of their duration can be onerous, and are not open to challenge either. But should leasehold be dispensed with, or should it be reformed or replaced? These are reasonable questions, and they have yet to be tackled. Property rights are a tough nut to crack, because it is potentially amending principles of ownership of land, the most protected form of property everywhere. Good luck with that.
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I'm sorry, but you really are making a critical error: not everyone is like you. They may need or want direction, and they may not be able to afford a ketogenic diet, as animal proteins are expensive. So, really it's not about you. It's about everyone, and the state serves everyone, whether they need it or not. And Digital exclusion is a thing. And few don't in some way or another. I mean, you remind of the state of affairs in London before 1666. Then, people who could afford to pay would buy the services of a private fire brigade, to guard their properties from burning down. Only the houses carrying the plaque of a Insurance Company were protect. But unfortunately, that was only a minority of properties who could or did access those services. So when the Great Fire of London took hold, the uninsured houses helped the fire spread, which in many places, overwhelmed the private firefighters, and burnt down those insured properties too... Huge swathes of London were destroyed and people died, because of the lack of communal services, or joined up thinking. Everyone was, as they thought, was protecting themselves, with no thought of how their choices could impact others. So, arguably no Freedom comes without Responsibility. And waiting until a post-mortem after a disaster happens is pretty late to learn that a community response is sometimes far more effective than an individual or familial one. Good Luck with your weight loss.
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I think the Economic History from 1914 onwards is on part a history of the US using its financial power to hobble it's rivals. The Special Relationship myth obscured the hard-nosed truth about Geopolitics and financial and economic Imperialism of that period. Let's not be shy about it. Both world wars were opportunities used to elbow its rivals - mainly France and Britain - into complying with its plan to dominate the world economically and financially as its rivals had done before. "Geopolitics is a poker game where all the players are lying," and nothing has changed that truth. Perhaps if we were more willing ourselves to confront our own history of Imperialism, weight be better equipped to recognise its appeal to others. But our elites don't want to open that can of worms, because they're still involved in it many ways. Hence, the hypocrisy and avoidance of confronting our complicity in many ways in the present. In avoiding facing up to it, we in turn become victims of it, because no empire, figuratively or literally, lasts forever. History practically is the best tool to reveal this truth. Knowing our economic and financial history, and linking it to political and geopolitical changes would have warned us much earlier of people like Trump, being the consequence of when one global economic hegemony is coming to its end of its potential for growth. The declining power turns to economic and political aggression to stave off its decline. It starts to try and find new sources of wealth for money to throw at the problem. That's what we did with our empire, and that's what the US is doing now, and they are so desperate that they turn on their allies and attempt to shake them down and bend them to their will. It's the imperialistic form of looking for change down the back of the sofa, when the prepayment meter is running out. So much for the heavies, turning to protectionism and intimidation of those they deem weaker.
It's not the first time our country has been subject to such treatment, and it won't be the last. Our domestic politics is literally a scramble for change down the back of the sofa, because winter has come, because our oligarchs deceived themselves, and deceived us in turn about the harsh truth. What to do? Put aside the delusions, because they will not help. Trump is trying to rattle us, because he perceives us as weak and clueless. And in some ways, we've been naive. We should stop lying to ourselves about what is being done in our name. We should stop appeasing the asset wealthy, because they're aren't focussed on solving our problems, but satisfying their obsession with having more at any cost. They shaped the narrative to suit their goals, and if we let them, they will impoverish us further and damage our economic potential permanently. And they need to give up their untenable obsession with infinite wealth on a finite planet. We are at a tipping point in history, and the only way to not damage ourselves further is not to pretend that there is no alternative, as we falsely keep being told. We need to push back on that.
Richard's 14 Questions need to be asked not only of Keir Starmer or Labour, but of every politician wanting to govern us. Indeed, the American people should be asking this of their leaders too. Because, we need to face up to the fact that what they are proposing can't work. Business as usual isn't going to work to rebuild economies whose foundations have been neglected and need attention to survive, and are weakening our social fabric. There's nowhere to hide from this. There's no ladder to pull up, as the latter itself is rotting. So we need to look at things more differently and more honestly if we are to come out the other side permanently diminished economically and socially.
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I think you're being gentle here, Richard. It's not only the US domestic economy which has skin in the game, but the global economy too, because USD is the global reserve currency, and in effect and practice, the Fed is Lender of Last Resort to the global banking system. Like all central banks since 2008, the Fed already has a credibility issue when it insists that it directly controls interest rates, but in reality are more like the Wizard of Oz, reliant on perception than concrete power. Mainly because the perception of risk differs somewhat in the financial markets to that of the Fed. It's not the first time in history this has happened, as Frank L. Baum's satire attests. So the Pull Me, Push You between Powell and Trump is going to be political theatre all over again. Trump thinks he's the Good Guy, and Powell is the Heel, so Trump's going to win this bout? Not really. I think the Bulge Bracket Banks will tag-team with Powell and defeat Trump, whose approval rating is heading where our blood pressure should be - lower.
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Why do facts dont suddenly don't matter? You have a leaking pipe leaking enough to rot your house slowly from the inside, and your solution is to make the leak bigger by sticking a crude, flat headed tool, like a screwdriver into the hole, making it bigger.
Magical thinking about reality is a road to hell.
Instead of fixing income and wealth being extracted to to the already asset wealthy, Flat taxes, would accelerate that process, because far more speculation than productive investment is going on in the economy. What you ignore is that the asset wealthy don't deserve the tax breaks they are given, because they aren't investing it to help the economy create more jobs, build more infrastructure, or to increase the quality of services so that the economy can grow sustainably, they are effectively extracting it, hoarding it, and speculating with it. That's why the economy is tanking, because there is no money being spent on keeping the economy stable and sustainable. Taxes on the wealthy are the only tool to prevent the whole economy sinking further into dysfunction. FYI we have a debt based economy, and the asset wealthy own all of that debt, and by debt farming, they're actually preventing the economy from being stable and secure. That's why asset bubbles instead of productive investment dominate our economy, and why more people are getting poorer. And the only tool to stop this madness is to tax those profits, and distribute them away from asset bubbles and asset stripping into the real, productive economy. Cause and effect cannot simply be wished away, and the effects of misininvestment are what you see. And it's not good to accelerate that through demonstrably bad policies like flat taxes.
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I disagree. On the basis of the trends in the Popular Vote - which partirs individual voters actually voted for - since 1945, the country has always been more left wing than First Past The Post allows in seats in Parliament. That's the problem. A rigged system that negates one's vote is arguably democratic in name only. It arguably smug that the country that gave PR to West Germany after World War II to prevent another rise of Nazism, never thought to give that to its own population. Yes, British lawyers drafted West Germany's constitution. Yet that same country's leaders ignored the warnings of Lord Hailsham only a generation later about the emergence of an elected dictatorship which was intent on hoarding power to itself. Really smug, and we are suffering the consequences of that. So no real reform can take place without constitutional reform, beginning with PR and evolving more power away from Westminster to the Regions. England needs devolution, and local authorities needed to act not as Aunt Sallys, with decreasing power to respond to their local problems, but as real local governments with the power to deal with their problems. That with economic reform, will provide not only more responsive government, but a more responsive and growing economy that doesn't ignore market failures, but actively works to avoid them.
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Based in these economic policies, Reform UK are economically illiterate. Anyone who wants to investigate the Gold Standard Crisis in the 1920s, read "England's Cross of Gold" by James Ashley Morrison published in 2020. The Reform UK party are economically and politically blind to sell out Great Britain to the highest bidder by replicating mistakes of the past. We should not let them. They don't have the best interests of the asset limited, Income-limited people reliant on wages at heart. Not by a long chalk. They imagine themselves to be the new nobility of a completely privatised state cometely dominated billionaires and trillionaires. Not democratic control, but corporate control of every dimension of life, because the plutocrats will own and control it all, and democracy will be surplus to requirements,along with humanist values like rights for those who are not asset wealthy. They are not nationalists, because power will be wielded only by the plutoctrats who will run the state like regional corporations like the city states in medieval Italy. And we know how that worked out for the Italians. Don't trust them. If you think what we have now cannot get worse, you haven't seen the worse, or understand that this has been tried before. Remember, their wet dream is to rule not with human interventions, but with machines. Thus they will allow excess humans, surplus to need to die, or be killed in the turf wars that will follow as a consequence of them taking power. Don't give in to them.
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You're comment suggests that you can't see the wood for the trees. Economics was created by people, and it's about people, and what people do. But - like any academic discipline - it's a framework, or a model, or a lens through which we examine human activity. Rather than be dehumanised, it is all too human, in that it is shaped and directed by the powerful in society. It reflects their proclivities and concerns more than others. The fact that we study it at all is a culmination of choices made by those who can influence it the most. But like a famous British statistician said: "All models are wrong. But some are useful." You see, academic disciplines are technologies of knowledge. They are tools, that are designed to make up for our deficiencies as humans. But as we are imperfect very often so are our tools. We craft them to achieve certain outcomes that we think might help us achieve some goal. But as always what goal we pursue has to be analysed and tested against the reality of it's pros and cons. And we can't ask the tool to do something it was not designed to do. The designer or the user, or both may be at fault. Indeed, if you read Adam Smith's the "Wealth of Nations", you might not recognise it as the discipline we have today, because certain concerns of Smith are not the focus of the discipline today. And that's because human inquiry is subject to human attitudes, biases, and beliefs. Being human is... not straightforward or simple. And neither are our choices. If you want the tool to be updated, one might remember that the Map is not the Territory. Therefore, it has to be updated as things change, and as we change. Just a thought.
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Richard, have you read the book entitled "The Dictator’s Handbook: Why Bad Behavior is Almost Always Good Politics (2022 expanded edition)" by Bruce Bueno de Mesquita and Alastair Smith? I think you may find your answers there as to why this Labour government is turning out the way it is. And most likely anyone else who might succeed them. If what de Mesquita and Smith argue is true, solving the very real problems of the electorate and the economy cannot be the first priorities. The electorate are interchangeable, as they vote purely in what they imagine is their best interests. Therefore, the concerns of the masses are to be met with slogans aimed at whom the government thinks will need to vote for them so they can stay in power. Likewise, the influential in our polity are next up the ladder, and they will only play ball if they can at least hold onto their wealth, and better still make more. And finally, there's the winning coalition who must also rewarded for their loyalty, and continue to benefit. To pay for all these handouts, they need money, and borrowing more to fund these dispensation is unpopular with those who want such borrowing to be done via the private sector, and not via an overdraft from the BoE. So, to keep the interchangeable voters happy, they have to throw them some red meat, whilst pretending they can draw blood from a stone. Or, that low pay still isn't embedded in our economy, and with the advent of AI, a service economy such as ours will be hollowed out within the next decade. So many people have died during both austerity and the mismanaged pandemic response, and perhaps more are to come. Meanwhile, I hope we can find a way not to inflict another disaster on ourselves. You see, even if NF or a Tory becomes PM, the same game will play out. There's a political cartoon in from The Guardian where 2 dogs are playing Tug of War with a bone. the 2 dogs were the two wings of the Conservative Party, and the bone was the party itself. Likewise, the interchangeables, are the bone our First Past the Post system will tear at to win power at all costs. When they, the politicians, run out of scapegoats, they will have to find new ones of course. Pastor Niemöller understood that all too well.
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What gets me is that the remaining rump of the Tory Party *hasn't* got anyone with a functioning, pragmatic political *brain cell* left. It's just full of entitled wannabes with no original thinkers among them, utterly lacking in self-awareness or strategy. They are the British elite *malaise incarnate**, filling a void in our politics that exists because of the decline in **institutional* trust.
Kemi Badenoch is nothing but a *war hammer in search of any war* to remain relevant. She is not a pragmatic *politician**, and her ideology is **suspiciously convenient**, suiting the ends of those who employed her as a wrecking tool. But after you've knocked down everything there is to be knocked down, **what use are you?* Kemi Badenoch is *clueless* about what should actually replace her targets. She is *clueless* about solutions to address the immediate political and economic problems that the majority of voters *prioritize**—not the minority who **fantasize about being* Bane or The Joker, destroying Gotham City for its sins, yet who *fail to grasp* the realities beyond comic book metaphors.
She's pretty good at knocking things down, but seems to have no interest in *fixing* them, repairing, or rebuilding the damage. While she might *see herself* as a virtuous destroyer, she lacks the capacity to *envision* or communicate a meaningful future for the country.
(In that, Kemi and Keir are in *the* same boat—*neither steering it themselves, but instead following a course set by others* who have no long-term vision that the British people as a whole can get behind. That is not the plan. The plan is to drive forward their own political and economic agenda. And consent for that has to be manufactured. And Kemi and Keir are tools to do that. Indeed, between Keir and Kemi, there is only a choice of **soft or hard technocracy**. Britain is not being led—it's being managed, and the inequality driving institutional distrust among the public is being left relatively undisturbed.)
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Money is not a proxy. It is money. A share is a proxy for money which you buy with money. But it is not a one-to-one equivalent. Try buying a coffee in Starbucks with a share certificate.
A government is not a corporation. Corporations can't issue their own money that can be used by everyone. So your a ology is misleading. I understand that you are trying to look at the situation in terms of *credo*, or credit as faith or belief, which is the basis of money. But market sentiment is about profit that is denominated in money. And you are right, in that if people lose faith in money, the less people will use it. But, as a shareholder, I am very unlikely to try and buy anything with my share certificate, because I will fail. Money is not a share. And corporations never tax their shares. Governments do tax what extra money you get from your shares. And the credibility of a Governments money is its value that others will use it as a medium of exchange for goods and services. The difference lies in the power behind the currency. Taxation is a tool to control the amount of money in circulation, that isn't being productively used. But speculators don't like that. And the battle between governments and speculators about taxation has its own black propaganda about taxation. Because for speculators it's a numbers game. Bigger number in their bank account is everything. The government can't afford to see everything that way, because the consequences on the welfare of everyone and not just the rentierists, is their priority. It's not just about individuals. Human nature can be a danger to humanity, because it can be blind to consequences in pursuit of a goal. And none more so in matters of power and wealth. In americal, ever since 1917, the Debt Ceiling has climbed in real terms. And now the new administration wants to increase it. And to cut taxes. And implement more tariffs, and these are by nature, are inflationary policies. But are you worried about the value of USD? If not, why not? I answering that question, you'll have to look at money as money, and why price inflation is important. Corporations worry about that as it could kill their business. But price inflation doesn't kill governments. it kills those who don't have enough money. Governments have as much money as the people controlling them want. That's why the debt ceiling is not a ceiling; it's an elevator.
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It quite true. Sterling is still a reserve currency, mainly because it owns so many tax havens, whose clients rely on Gilts to fund their financing, along with US Treasuries, and German Bunds. It wasn't the fear of inflation. It was that she didn't tell them beforehand. Truss was paranoid, and it destroyed her credibility, especially as the Tories under Johnson was so much of a circus. Most policies are are quietly outlined to the people that need to support it beforehand. But Truss did not insert herself into such groups not did she share any information with them. It didn't matter that the people who nixed her plan, were the people who would have benefitted from it the most. They had to teach her who's boss. Why? no rules along. Truss didn't understand that key to power. So, by making a god almighty fuss, they killed one to warn a thousand. She was shredded because she didn't understand the rules. Whether we like to believe or not, no budget is a total surprise to the City. Donors don't give their money people they don't trust to deliver, and the City of London were the largest donors to the Tories by industrial sector. But Truss, naively sidelined them, and got rid of people the City liked, because they weren't yes men. The relationship between the Square Mile and the British Government is incestuous. No other chartered corporation has one of their number sit in the chamber in the House of Commons not in the Guest Gallery, but in a seat placed behind the chair of the Speaker. That right is written in the Royal Charter of the Corporation of the City of London. Moreover, the Foreign Office runs the Mayor of the City of London's calender. He goes off on many trips abroad to fly the flag for the City and the UK. Again, no other Royal Chartered Corporation gets that service from the government. And really, the Tory Party choosing Truss over Sunak would have irritated the City as well, as Sunak was a City insider, and an alumni of RBS and JP Morgan. She gave them the bullet with her name in it, by ignoring them. So, they ensured she would fail, by overreacting to her "unfunded expenditure", even though almost all government expenditure is unfunded, especially after Brexit.
Second, Milton Friedman assertion that Inflation "is, and everywhere, a monetary phenomenon" isn't borne out by the evidence. Two things: Wage Price Spirals and the Kenyan Random-controlled Trial of helicopter money prove that not only did Friedman overgeneralised his axiom, but that wage Price spirals are rare, and are not persistent. Money & Macro channel reported the findings of the ongoing helicopter money trial that there was zero inflation in the first 2.5 years after the money - $10 million - was given to households chosen at random in a North Kenyan county. And the economic impact was tracked individually as well as regionally. Then, the IMF staff wrote up desk research study on Wage Price Spirals in 2022,where their evidences-based conclusion was that Wage Price Sprials were significant, but short-lived in their impact on the greater economy. Both these studies are a available online, and Money & Macro talks specifically to the reasons why Inflation did not appear. So, the orthodox models you relate are not to be consumed unquestioningly, because the evidence isn't there to support Friedman and no-one has contradicted the IMF paper punished in November 2021.
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There is a different perspective. Democracy can only die not from an external threat, but from internal neglect. And the neglect emerges from a malaise that affects both the top-down technocrats and the bottom-up citizenry. It is at its heart a lack of attention to reality. Perception trumps reality everytime, and reality then kicks us until we pay attention to it.
And the fish rots from the head, as they are supposedly the more intelligent and perceptive, right?
The truth is that we keep getting bruised because we refuse to look at reality. Instead, we are like Dorian Grey staring into a picture that flatters us, but instead is showing our ugly side, that has been cultivated for years for power and profit. You'd think we'd have figured it out that our head is being filled by nonsense, but because it's flattering nonsense, it sticks like poop to a shoe. It's less about just or unjust desserts. It's just human nature being leveraged for profit. And it's not so much a stretch when you consider Divide and Rule is a political strategem with an ancient colonial pedigree. Our malaise is being encouraged to grow, so that certain people might profit from it. So, scapegoat after scapegoat will be wheeled out to deny and deflect from the reality we should be embracing. Because you can't fix a problem until you accept it exists. And until both those at the top and those at the bottom do that, they will not meet in the middle and start actually tackling the real causes of their worries. In fact, it's not until Reality takes a running kick at our collective bum, hard enough to shock us in to actually looking outside the cave and into the world beyond, will we get over our delusions. It will happen, but if we stopped gamifying everything, and just did what actually needed to be done, we might forestall of what's coming down the line, that we can't defeat or mitigate inside our heads, homes, or bubbles, but only deal with collectively with a shared vision of the future. That's what we lack, because the future we trying to live is unsustainable, but no spoonful of sugar can disguise that. So we throw scapegoats under the bus. All to ignore our complicity in the mess.
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You obviously don't recognise that Economics is a Social Science, but you like good economies, right? Or history? Or psychology?
Prejudices are no proxy for real knowledge or wisdom. They run contrary to the dictum of the Delphic Oracle "Know Thyself", which is the the Dictum of the Social Sciences. Why? In anyone's life, there is only ever one person who is always present: oneself. By understanding better who we are as humans, and what shapes our collective and individual action, we are nothing but Bulls in a China Shop, or hairless apes. We are the source of civilisation and studying it and analysing how we are as a species and as societies is the key to the lock of our true potential. Not understanding ourselves fully has bought us to yet another Bull in A China episode in human history. The paralells are clear. We have bern here before, and we'll probably wreck the joint yet again until we all acknowledge that we are still hairless apes who haven't evolved that much, and perhaps should pay attention to the limitations that imposes on us indivudualky abd collectively. That knowledge and hopefulky wisdom is our true legacy to those whi might follow us, if we can stop being cadidates for a Darwin Award. Have a nice day.
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Interesting argument, because the messiness of geopolitics makes everything associated with it messy too. Yet, there is another perspective and it is a pragmatic one. Another commenter argued that justice and peace are mutually exclusive in the context of war. You can't have both at the same time. To bring peace, it may be impossible to give justice in any meaningful sense. To bring justice to Ukraine, no amount of money will make up for what has been lost, even if Russia returns to its 1991 boundaries. And Justice doesn't matter to Russia, because "might is right", right? Since that is the case, the money is a sunk cost in a venture that needs no reward. A gamble, which was lost.
But we should be aware that certain Russian elites won't stop gambling with money they didn't earn, or with lives they do not value, until it costs them a price which they themselves must pay.
In this context, Mother Russia, or any motherland is mostly in danger from its elites, if they exist within bubbles, cut off from realities, that they ignore, or make no effort to understand.
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I think it needs to be said, that the transfer of wealth to the asset wealthy from everyone else is a feature of Neoliberalism and not a bug. And it's time that our class-obsessed society realised that. Any economy that chooses debt to drive the economy increases wealth inequality every year. The emergence of populism is the response to that fact, and once people wake up to the reality that there are no political parties in the UK that have realised that neoliberalism is no longer economically tenable - and that includes Reform UK - the UK economy will continue to impoverish everyone who isn't asset wealthy. And that includes homeowners too, who are trapped in the illusion of nominally increasing house prices making them think they are building real savings, when their spending power is being eroded by the purchasing power of their money being eroded. The fact that their are anti-MMT bots on this channel, is proof that the wealthy are scared that people will wake up to that reality. The truth is that every 50 or 60 years or so, the economic system reaches its structural limits, and this is happening now. The bots are proof that the rich who fund them are running scared. And they should be, because the political horses they have backed so far will accelerate the break-up with neoliberalism within the next generation. They hope this dysfunctional economy can continue, but it can't. And not letting it evolve to a fairer and more sustainable model will cause more damage. And that will be true, even if Reform UK - who is yet another neoliberal mouthpiece - get into power. The economic model doesn't work anymore and is economically unsustainable. Until that nettle is grasped, the pain will continue.
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Yeah, ask Boeing, and numerous other failing companies about that. I mean your body isn't lean. I sure you could sustain similar treatment without any pain at all. Lol. Shareholder Primacy is hollowing out many businesses because it encourages "lean" as in anorexic management. We have less customer satisfaction with "lean" customer service that is so lean it serves no customers. We have such "lean" manufacturing that both in quality and content, we seem to sell fake food, with low nutritional content, but with a huge margin. Or, instead of supplying our people with clean safe water, we poison then instead, and being so lean it goes on for years. Need more be said? And let's not fool ourselves, these oligarchs are there to find out how to secure a chunk of that nice tax revenue. They couldn't give a damn about waste, especially when it's paid to them.
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Starmer's weakness is that he doesn't appreciate that sloganeering is not effective policy making. The ignorant will be misled, and the informed will be sceptical. If he really wants to impress develop a measured and grounded overarching narrative that identifies accurately the changes needed, and explains why. If he carries on in his current vein, he'll end up alienating everyone, as everyone is tired of empty soundbites. Everyone wants stability and measured policy making. I hope he oblige us, or he'll be building up the sense that he hasn't a firm enough grip on the realities to realise that he counfuusing the map with the territory. I mean, Aswath Damodaran, a professor of Finance at NYU Stern, noted in his blog and YT channel about the current events in anti-trust policy in the US, that law schools globally are pretty useless in teaching their students about business. So when they become regulators, they don't always understand what businesses do that can or should be regulated. And Starmer is a criminal lawyer, so regulation is naturally out of his wheelhouse. I suspect his advisers are inexperienced too. Or he wouldn't be doing what he's doing. All politicians in government learn on the job, but they need to have the right people around them who will not lead them astray. I'm not convinced his team of advisers are match-ready.
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Sorry, but we're not the laziest or unproductive workers in Europe. We're the least invested in workers in Europe. From the cuts in education where we are turning out the wrong types of workers for the jobs needed, from corporations expecting never to train their employees, and Government expecting the magic private sector to take care of manpower planning in the economy, and you get the omnishambles of UK plc, where we are ever more dependent on importing talent ratther than growing it. You get the buzzwords like "lifelong learning" but no funding to provide it. And we do not pay apprentices a living wage, even though they are learning in the job. They don't even get enough to pay their bus fare to go into their apprenticeship. We have unpaid internships, which are exploitative, and there is no guarantee, any longer of security for workers. Indeed if those at the top are only doing the bare minimum, why do you thing anyone else will do more than that? When I hear people say British workers are lazy, I just say "it's monkey see, monkey do." It's time certain corporate leaders led by example, and stopped bitching about how lazy everyone else is but they are. They are many who are lazy, short-sighted, and irresponsible with the power society gives them. I know, I worked for many of them. To the extent, I wish I hadn't. The jobs I loved gave me control over how I did my job, and helped me to do it well. And I turned out results to the best of my ability. That is not the norm. We have to be honest with ourselves as a country, and admit that our problems reflect our priorities, and if we don't like dealing with those problems, we need to look hard at our priorities. Blaming and scapegoating does nothing useful. If you cannot motivate your workers, then that is your problem. Not there's. Even if what you said was true about British workers being lazy - which it isn't; British workers work longer hours than anyone else in Europe - they weren't born that way. They were made that way because their leaders are that way. Look at what Prime Ministers we are creating, and that should give you pause, because if they are the best this country has to offer as leadership, you shouldn't be surprised that others just might be either following their examples, or being apathetic.
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But your answer is not answering the question. And as for costs rising. I've lived long enough to see a 2p bus journey now cost £2.50. And benefits have not kept up with that rate of increase. But working people who are paid a true living wage can afford to pay that fare. And isn't that the real issue? Britain is a low paid economy relative to its peers, and that occurred over the last 5 decades of mostly Conservative "small state" policy and privatisation. Whereas real GDP has gone up like a ski slope, the Labour share of Real GDP has plateaued, and it has been left to the Welfare State to make up the difference. That is not the case with our peers. And that is on us. We have allowed a huge transfer of wealth to the mostly already asset wealthy, and have not invested in our workforce skills and health, to the extent that our productivity is far below that of our peers. The short-sighted "small statists" policies have left us with an over large financial service sector dominating the whole economy, and not providing well-paid jobs. We need to invest and return to a mixed economy, instead of one vampirised by wealth extractors. That means the asset wealthy should not be favoured more than those relying on a wage for a living, and that the welfare state should be geared to keeping people healthy enough to work to to the best of their ability, and to be able to afford their basic needs without the need for their wages to be subsidised. Yes we have the most vulnerable in society, and they should be looked after, because everyone potentially will suffer sickness or ill-health, or old age. How we treat them is the minimum level of civilisation we have. Cut that down any further in favour of the asset wealthy, and we will have more diseases of poverty and more people not working because of illness. Our problems reflect our priorities. If we don't like managing our problems, we neeto look at our priorities that put them in our lives. We better priorities than making a few people even richer.
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Not really. That was only the case after the pandemic and the beginning of the war in Ukraine. Now it's a different story, because household spending is falling, and unemployment is moving upwards. Retail has been hit hard, and the big names are cost cutting. Moreover new orders, as we move into the busiest time of the year - Halloween, Thanksgiving, and Christmas is declining. Also, loan defaults are still climbing. So the economy is not slowing for a lack of goods, but the absence of people who can afford to buy them. Money printing can't solve that directly, but the malinvestment and speculation that is siphoning money out of the productive, job-creating economy can be addressed by removing the incentives to malinvest and hoard money.
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All it seem we are creating are hot house flowers rather than leaders with real intellectual rigour. All ornament, but of little practical use. Once they are removed from the climate-controlled greenhouse and put into the real world, their attractions quickly wilt in the harsh climate of reality.
Honestly, you, Gary Stevenson of Gary's Economics, or Political Economist Mark Blyth are the calibre of politician this country really needs. Not only do both of you have a grasp of The Dismal Science enough to display of understanding it's real world limitations, but you have displayed practical application of its ideas enough to formulate reasonable and reasoned positions that at least are addressing Economics and Finance's biggest failing in the real world: the distribution of resources. It's a lacuna in both disciplines that reflects a real world disconnect between their theory and application. Or more simply, the real world consequences of failure to meet the needs of everyone in the economy. In that, much of the economics and finance as taught is limited to a carefully curated view of reality that is detached from it. We are turning out economists that could get a job in the city but who fail to grasp how the economy is basically failing, and still get a decent job. In other words, stuffed shirts. The last thing we need are more paper tigers - efficient exam taking machines and ladder climbers who don't really care about the ideas they dutifilly exposed themselves to get a qualification. We need people who actually think beyond their own career. Or things are only going to get more lavatorial.
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@Gibbonomics You might say that, but you have to ask why did humans evolve to have empathy, before rational thought? One is not better than the other, because intelligence is context-dependent. Literally, one's experiences shape how your brain grows. And our brains developed the need to relate not only to what we now call family, but to our collective - the tribe too. Until you can explain that, your conclusion is nowhere near the far more complex truth. Nature's agenda always trumps any rationalising we might indulge in. And there's a shed load going on amongst the Russian elites. And one can understand why. But, the bubble they exist in is misleading them. And it's not all their fault.
America and Russia share one thing: they are both too big to know themselves or the world in any depth. The world is bigger than they are, and there's much, much, more to learn.
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No; he isn't being disengenuous. He is being literal. Have you you actually studied the evolution of money? Money came into existence before Finance and Economics. And for good reason. Indeed, Accounting came before Finance and Economics. Money emerged as civilisation did. Why? It is a tool first for representing our beliefs. It is a technology for representing our bekiefs. When we did not need money, it never existed, but when we needed tokens of value, it emerged. And as our civilisation as a species grew, it developed means of valuing, counting, and tokenising value. And we have Accounting, Finance, and Economics respectively. So, as a Chartered Account and an Economist, Professor Murphy can combine the two disciplines to critique the dominance of Finance over Economics. In this we should be careful not to conflate the two disciplines, and their perspectives. You see Finance has different goals to economics, and we often are encouraged to conflate the two. But they are not the same. Hence our confusion about money, and the heterogeneity of beliefs about it.
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@PatrickMcLaughlin-ji4rb Sorry, but you don't understand logic. Logic is the means to process information, and it doesn't not control the accuracy, validity, Iegitimacy of the information processed. Hence, the computer science acronym of GIGO - Garbage In, Garbage Out.
Logic doesn't care whether the inputs are objective, measurable truths, or subjective, qualiative truths, like morality. Or lies and falsehoods. Therefore, behind every atrocity in human history there was logic...
So, such misapprehension create the inability to grasp with the reality that we're in a Post-truth populist era, because people don't understand logic, and how amenable it is to both good and evil. It is an amoral, mechanical process of processing assumptions. So GIGO applies.
That why Steve Bannon strategically argues for "flooding the zone" with 💩as to override logic with untruth, to deny, to distract, to neuter both "rational" logic and 'moral' logic, which are not the same. Rational logic relies on objective, empirically proven truths as inputs, but Moral logic relies on subjective, unprovable truths, that can only be qualiatively and subjectively experienced. The logic of the greedy vs the logic of the moral is a choice, a subjective one, and thus falls into the realm of belief. Not facts. Ideology. These can only be argued for, and the inputs, the premises, the assumptions, can be manipulated. But what else are rich people doing but trying to reshape our reality? Hence, we need to be more sceptical about rich people knowing what's best for people who aren't rich. We need to stop loving and admiring them. We need to see them as ordinary people and not heros or gods. Americans have that blindspot, and it keeps hurting them. We should take that beam out of our own eyes. And see them as they are.
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Absolutely. And selling these bonds into the financial market means that the Dealer Banks will be buying as much as they can at this discount, and will either sell or lend them out at a profit, or redeposit them in their reserve accounts at the Bank of England which ensures they meet their capital Reserve requirements quite cheaply, and get paid interest as well. It's another form of subsidy to banks that should be able to stand on their own feet. As Mark Blyth, the political Economist argues:
"First, it (the Labour government) could massively increase its fiscal space by telling the country’s central bank, the Bank of England, to stop paying interest on the commercial bank reserves that it holds to influence short-term interest rates. With the United Kingdom’s high interest rates, banks prefer to hold on to money and not invest in the real economy. As a consequence, they are expected to make around $286 billion in interest by 2033 by simply parking reserves at the central bank.”
That's nearly £218 billion a year to the banks in interest. And who benefits from that? Only the shareholders of the banks, because banks are not investing in the real economy, because that is more risky than selling debt and speculating. That's why Sunak was going after the UK pension funds to start taking more risk by investing in capital projects. So, ou pensions are going to be exposed to investments that banks aren't interested in. What could go wrong?
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But what you dont acknowledfe is that modern monetary systems are no longer solely run by government, because instead of national financial systems, weve been encourage to allow evolving away from that to a global financial system which produced the largest amount of money - bank credit - on behalf of sovereign states, multinational corporations, and financial institutions. The financial institutions need to be paid for creating this source of the cheapest capital on the planet for investors. So, the UK falling down the rabbit hole because of Brexit explains the disparity. And those cause the problem have used their money to buttress their power. I mean, even the US got downgraded in 2022.
So, trust is the basis of money as credit, and everyibe relies on it. And you should have provided the debt to GDP percentage and data about the US to provide some sort of benchmarking. Murphy knows how sovereign debt is used, snd he can caluate the analysis better than you or I. For instance, Germany has a low interest rate, but the differential between that abd the UK's doesn't correlate with their Debt to GDP ratios. Interest rates are subjective judgments on a debtor's riskiness, not on what they owe. I mean, Trump went bankrupt 5 times, but still got banks to lend to him. It was only after he screwed over Deutsche Bank, did that flow of cash dry up... Subjectively Trump was a risk, but it wasn't until it became a consensus in the banking industry, was the decision not to borrow to him an objective one. The same applies to yield rates for sovereign debt. But what's more important than individual rates, is yields relative to one's competition. And wirh Trump taking the presidency, alk bets are off. Why? His economic plan to reindustrialise the US won't boost the US' credit rating, because it's the consumer - who's already punch drunk - who will bear the costs in very direct ways. Americans will be living in very interesting times for the next 4 years,as will we as we all share the same broken global financial system.
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Starmer is coming across as a a bit of a Hot House Flower. Bought into the cold, ruthlessly sharp climate of front line politics, his foliage is being shrivelled. And his defensiveness is becoming the story rather than his political vision.
You Richard are a good communicator. You're used to transmitting complex ideas without oversimplyfying them. Whether one agrees with your conclusions or not, we understand much of what you say and why your saying it. The gift of being a good teacher I suppose. And you're not alone. There's Professor Mark Blyth of Brown University in the US, who is brilliant at putting ideas about political economy in developed countries. I discovered yesterday that he used to be a stand-up comedian, which explains somewhat his style. Both of you could be great politicians because of that. Lawyers are supposed to be good speakers and the best trial and appeal lawyers are excellent and engaging, but not every lawyer is good at being a trial lawyer. They're good at being administrators and managers of small teams, but they don't get enough practice at communicating to a wide audience. I fear Starmer falls into this group. He's not "mastered his brief" enough, and it shows. He's not incompetent, but he is inexperienced in getting a crowd of people engaged. He's too self-conscious, and he's not used to being challenged or heckled. I think Starmer never had to do that kind of communicating, where being challenged is to be expected, and you understand audiences. It normally takes a good while of having to deliver that kind of engagement regularly to become skilled at it. In Labour's early days, going out to working men's clubs, union meetings, and regular campaigning honed those skills 'on the stump." We don't have those opportunities so much today, and our politics is suffering because of it.
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How does Elon square importing foreign labour without training American citizens to do the work he wants migrants to do?
By now, you should be feeling a little unsettled, as you should be. Embrace that feeling and go where it leads you. It will remove the scales from your eyes about the nature of Musk, Trump, and all the post-truth authoritarian populist spivs who claim to represent "the people." They don't. They represent themselves, their kith and kin, and who is in their pack. And it isn't you, nor your loved ones, your peers, or your class. You think extortion can benefit you? Then why not elect a modern Al Capone? who is extracting his cut from you and your class right now. Your grievances are valid, but misdirected. Foreign corporations do not run your economy. They do not set the rules you live by. Nor to they tell you it's your fault that you are a failure according to their standards, when you have to go bankrupt to pay your medical bills. Did you ever watch the HBO series "Succession"? There's a line in the script of Season 1 Episode 9 where the wealthy media mogul Patriarch of the family says:
"I don’t like being outside the US for too long... There's a mercilessness I miss... Fucking without a rubber. Everywhere else feels soft... All of it. Slaves, cotton and sugar. This country was nothing but an off-shore factory for turning evil into hard currency ."
The last sentence was broadcast as:
"This country was nothing but an offshore factory for turning suffering into gold."
Suffering was almost always part of the deal until 1945, when America got "soft" as the means to prevent communism or socialism taking over. The GI Bill stopped the repeat of what happened after the end of World War I. Unions were allowed, and wages were allowed to rise so that Consumerism could be embedded, and American exports could flow outwards to the territories of the old world that was being rebuilt. American multinationals could walk in through the doors American politicians had kicked down as the price for fighting a 2nd world war. And American workers enjoyed the benefits that came. But, it was built on shifting sands. The American economic empire was a victim of its own success. It couldn't last when fighting communism was so damn expensive, even though American banks were in cahoots with British and European banks to get around US capital controls. Fear. Everyone needed USD and US Treasuries, but there were never enough. American bankers created securitisation of debt in an attempt to fill the gap, but as a consequence, put in place the foundations of the house of cards what would come crashing down in 2008. You know the rest. The postwar consensus was too expensive for elites to maintain, and a demographic and technological shift ensured it's demise. The American Dream, could not withstand reality. And all through that American elites did not care about you and yours. They did what they did for you to prevent you picking up the pitchforks. And so, using the insights of politics, economics, and psychology, they sought another method - the Enemy Within. Old wine in new bottles BTW. Every empire has used it in its old disguise as Divide and Rule, and America was no different. Blacks and immigrants, were always convenient scapegoats with thing went wrong. And the politicians could harvest your resentment and make political capital out of it. But, when things continue to go bad, you need new scapegoats to deny and deflect from the reality. So trans, BLM, Antifa, Immigrants, Blacks, and finally foreign corporations. How convenient.
What doesn't change is that American workers continue to suffer. Sufferings part of the deal. Nevermind the employees' slice of the GDP pie keeps shrinking year after year, whilst fat cats get fatter year after year.
Extortion rackets never end well, and the costs outweigh the benefits. Especially as your favourite elites like Musk and Trump will inflict the costs of those tariffs on consumers like you. So your standard of living will fall, as importers pass on the added costs of tariffs on to you, the consumer.
Now, with the fires in California, there's going to be an uplift in inflation, even before Trump can apply any tariffs, which add more inflation on top. If your feeling the pinch now, just wait until Easter if Trump starts throwing out tariffs like confetti in his first 100 days. If the more grounded analysis wins out, Trump will impose very few tariffs, and those will be symbolic. If it doesn't, you had better punch some extra holes in your belt, because it will need to cinch tighter to hold your pants up. Good Luck.
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Look, this is politics, a very human activity subject to human tendencies such as perception being more influential than truth, simply because truth, like thinking, is hard work, inefficient, and not always comfortable to sit with. Al lot of human problem stem from these limitations. What we want isn't always the absolute truth, but just enough truth we can be comfortable with or is useful. That's why maturity is the realisation that a lot of what you've been told is true isn't, and you come to a place of compassionate scepticism. In other words, you pick your battle. Strategically and probalistically, truth is a collaborative project. It relies on consensus to be accepted as true. And consensus isn't easy to get, or keep. Nevermind the reality that those within the consensus are limited, including you...
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Does anyone see breathing as work? Do you even know how many breathes you take in a minute? Hobbies and work is a false dichotomy. Both take, time, money, effort, and commitment to accomplish a goal. So its an us problem really. For example, take school teaching, or teaching as a profession.
People jump quite a few hurdles to get into that profession. Lots of exams to get their graduate qualification and mentored learning to become a qualified teacher. But notwithstanding their demonstrable focus, commitment, and dedication, new school teachers are leaving the profession after qualification within 5 to 7 years. And they're the ones that even finished their training. Only 24% of those starting teacher training actually go on to qualify. 76% drop out.
We have attrition in medicine and nursing too. At one time, according to the College of Nursing, the NHS had over 100,000 vacancies for nurses, which is why we have to get them from outside the UK, because we don't even have enough training places, never mind the student nurses we do have being so broke they eat the patients' left overs and use foodbanks.
Criminal barristers who are self-employed, were before their pay rise earning before deductions, expenses, and student loan repayments, around £15 per hour in a job where they have to travel to any court in England and Wales by their own steam to get there at short notice to attend court on behalf of their clients, and could be there for weeks. Their training is 7 years, to earn less than minimum wage.
When I was young, these were Professions with a capital P, but now, they're grist to someone's poltically entrepreneurial mill. And we are suffering accordingly. And if these professions have become difficult to stay in, what hope is there for everyone else? These professions and the institutions they work in are part of the glue that keeps our economy and the society in which it exists together and working. A democracy, yet over a few decades they are struggling to do their jobs.
To me, The Hostile Environment created in this country is not just for refugees. It's consequence of political entrepreneurs squeezing everyone else for their own gain. And as for the working people of this nation are going to be stretched to find enthusiasm in their work, if they can barely find a living wage in it.
Hobbies cost money, time, and effort, just like work. And if all you are doing is working just to meet your living costs, then hobbies become a luxury. Any work is done to meet a need, and pehaps we need to focus more on work and hobbies as means to meeting human needs, rather than just ends in themselves. I mean isnt that what an economy is actually for? Or am I missing something? Do human needs really matter in our society? Or we are just a society where we know the price of everything but hardly the value of anything?
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Free market capitalism makes no such claim. All it claims it that the winners win,whether the world benefits from that or not. In that framework, the market can then reject any product by simply not buying it. Of course, free market capitalism is unrealistic, because it disregards human nature, which is a fundamental flaw when people make up markets. Capitalism ultimately harnesses greed and fear - two emotions that helped us to survive, but are problematic in civilisation. Ignoring that fact, has led us to this messy time of ideological cul de sacs created for the benefit of the asset wealthy to excuse their failings, and prevent having to pay for the consequences. Of course, they want to persuade us that this is ok, whilst we get poorer and our children and grand children get even poorer.
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Why do you parrot that old trope without understanding what actually was going on? And why? It comes across as brainwashing. And to boot, MMT is not about money printing. Indeed, the term is deceptive in a world where 95% of money in circulation is "printed" in your words, by commercial banks making loans, and entering digits on a computer. Nobody complains about that, because they don't know that reality. The present reality is that of all the money in circulation, 95% is bank credit, 3% is central bank reserve credits, and the rest is currency as cash. The truth is that money creation is predominantly done by banks, with the government through their central banks being their safety net for the financial acrobatics. Historically, Germany's problems under the very short-lived Weimar Republic stemmed from not money printing but prior malinvestment that failed to create a bulwark of value and the burdens of war debt. Money Printing was a response, not the cause of its economic woes.
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The problem with your point is that it's is really stretching the meaning of democracy. Let's not forget that democracy as formed in ancient Greece did not solve slavery or poverty, did it? Why because you are conflating means with ends. Democracy is the means to decide who gets what. It doesn't decide what there is to get. Civilisation based on societies is even more complicated than ancient Greek city states, where only the oligarchs had a vote. In its current form in the Anglosphere, it's only been around for about a century. And that's nothing in human history. So democracy is still in its infancy. Can it be improved? Definitely. Will it be? Who's to say? Market ideology is en vogue, but is proving to be a false hope, and our oligarchs are trying very hard to cover up their mistakes. So our politics is negotiating the capture of our states by asset wealthy oligarchs who think - why I do not know - they can run whole nations better than the population. They dream of running whole states like principalities, just because they're rich. What the real issue is that Injustice and Illiberality exist, and the values to erode these are being eroded by the same elites who want to control everything. 'Don't be a citizen; be a consumer or a subject.' 'Don't be a member of society; just look out for your kith and kin.' we are being conditioned to look away from things that might remind us all is not well. And it is we who must look to our own values, and strive to arrive at shared values that are expressed through our shared institutions. That means not being complacent, and not thinking that's someone else's job to do. We have to talking and thinking together about shared values. And one could argue our overlords don't like that sort of independent action. They're too stuck in their ways. We shouldn't follow their example. We should dare to think how to evolve our society away from its current model which is actually endangering our society. We should be able to do better, but we're being encouraged not to do so. This why we need a state free of regulatory capture, and with the right priorities that ensures a basic standard of living to everyone. That's going to take time and effort, because ideas evolve faster than human beings. So we must keep working to improve things, because we can only go through. We can't go around.
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The Winter Fuel Allowance was not allocated efficiently or effectively. Efficient use of tax receipts doesn't give money to those who don't need it. So any government should ascertain a civilised standard of living for pensioners and people on benefits, and those who are above that standard should not get it. The problem is that the government standard of living for pensioners is too low. And that's an inherited problem, that can't be fixed anytime soon. The Cost of Living in the UK is going up strongly, and pensioners are not all loaded, but some are. And it unfair just to discribute limited funds willy-nilly. The basic living needs for pensioners needs to be addressed in a way that is clear and understandable. Nobody understands pensions at all. That's why the winter fuel allowance was poliiticised and paid as a bribe, but a serious number of pensioners were still needing to choose between heating or eating, whilst those who didn't need it, were getting it anyway. That should not be the case. That the state pension is still to low to live on, is another inherited situation, and pension Credit is still too low. That's the real issue, and for that you can blame a long line of givernment back to Thatcher who fiddled the National Insurance Fund and broke the link with wages. Google 'The Rape of The National Insurance Fund" by the late Tony Lines, and you'll see why pensions and the NHS ended up being squeezed for cash. The report is still online, and it ties into the Waspi Women as well. And the amount lost if adjusted for inflation are eye-watering. The fact is, the problem is too big now for any quick and easy fix, and it's only going to get worse. Political opportunism is only possible where people don't know what's really happened over nearly 5 decades. And labour can't fix it, because the accumulative problems has wrecked the potential for real growth in the UK.
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This is an opinion piece not a debate. Its upto you to challenge your own beliefs by looking for contrary opinions, and testing them against reality. The truth is that as only the government and institutions authorised by government can create money, there is no ownership of money beyond the government. Its very much like land, where sovereign governments have the right to structure and organise the distribution of land rights. In the UK, The Crown, in the form of the Executive in goverment has a sovereign - an overriding - right of possession and use of land, the area beneath land, and the air space above it. In the US, this right is called Eminent Domain. The same thing occurs with money. So there is no "taxpayers money" per se. Taxation removes money permanently from the system, much like a pump or lock gates control the flow of water in a watercourse. What the problem is that almost everyone is ignorant about the monetary system and the role of taxation in it. Worse tgey have been misled by political political entrepreneurs who have taught them to think negatively about taxation, and to lionise the private sector. As long as any institution - money or otherwise - is run by humans, they will occasionally make mistakes. No-one is immune to folly, but those who are not immune to folly, are not immune to the temptation to grift or self-deception either. So, ideally, we have to stop pretending that big business is somehow nore trustworthy than unions. Thats patent nonsense, because their human. Moreover, we need to make government better, and independent from both Labour and Capital. And we need to stop producing educated idiots as our politicians and oligarchs in charge of our institutions. In short, we're getting what we deserve, because we're less than sound or honest about things. Have real democracy, with devolved powers and sortition to choose who we devolved the powerr of the people too. Only until we stop settling for easy answers to hard questions, will things improve. Thats why populism has reaered its head again in mant developed countries, because their system of governance and practice of democracy is too stuck in the 19th century. And why our economics is brojen too.
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I think you need to read "Money" by David McWilliams. Then you'll actually understand the subject, because McWilliams is not a proponent of MMT, but understands the limitations of the theory in the real world. You don't in any real sense economically or politically. Why? If what you say was even just a little bit true, it would mean you love being "socially controlled." You like spending money, and don't mind receiving it. Hell, if you were to be paid to write comments like you have, you wouldn't refuse, would you? If you're writing these comments for free, then you are simply confusing the Map with the Territory. If you want to ground your critique in reality, rather than ideology, you need to study what Theory is. And you will then understand why MMT is nothing more than a map. It is not perscriptive, but descriptive. The whole thing about thing about MMT is not that it is incorrect. It is correct. But what does that mean for those creating monetary policy. Arguing ideologically about MMT is like arguing that a weather map shouldn't show where rain might fall. Not only is that iilliogical, it's pretty irrelevant. The only thing that matters to someone who using a map is what they should do about it. If there's a drought, then rain is to be welcomed. If there's too much rain, then that's a different matter. These are real world constraints, and every theory comes up against reality. It's reality that determines the applicability of any theory. For instance, two theories were tested by a charity - the first was Milton Friedman's assertion that Inflation is solely a monetary phenomenon, and the second was a theory of John Maynard Keynes, who argued that injecting direct money transfers to individuals would have a multiplier effect on overall economic activity, in that the benefits would cascade over time. A Randomised Control Study was carried out in Kenya, and Friedman's hypothesis (theory) was disproven, and Keynes was proven within a 30-month time scale. Fine. But what does these findings mean? and what are the implications? These are the real-world constraints on theories, which can be tested for. MMT has constraints, which haven't yet been tested for. Yet, the idea has been politicised, which doesn't help anyone. The truth is that MMT is a theory to describe only a very, very limited source of money creation. Indeed, it is the only source of money creation that governments have chosen to retain direct control of, but the amount of money produced accounts for less than 10% of the money in circulation. The other 90% is ledger money, aka Bank Credit in the private sector and created by banks issuing loans. So the idea that MMT is a form of Social control is just plainly wrong. It can't be, because it's impact is minimal. By outsourcing almost all money creation to the private sector, governments have reliquished control over the money supply. Indeed, the offshore money market is huge - $12trn market cap - but no government controls it. Until 2008, it operated outside government control, until greed and ambition wrecked it, throwing the whole global financial system into a crash, and governements agreed to bail it out, because every bank on the planet were involved. They used MMT to do that, instead of letting the whole system collapse, because there was no other source of money to do it on the scale it needed to be done. If governments had done nothing, there would be no money left in the private sector. That's the reality - they socialised private losses. Was that the right thing to do? Well, that's a debate that cannot be concluded, but how they did it, and what they didn't do impacts us to this day. The financial sector is more regulated, but banks can't make as much money, and that's a problem, when the demand outstrips supply, especially for USD, the global reserve currency. And the pandemic replicated those mistakes. MMT wasn't the source of those mistakes. People's ideas and beliefs were. And MMT is just pointing the finger at those. It doesn't say when or how money should be created by governments. People do thst, and their motivations need to be questioned, and MMT allows us to identify them and how people act upon them. It's not a prescription. It's a description, and the GFC and the pandemic showed the decisions made regarding monetary policy proved the description correct, but like good theories should do, it also raised important questions about policy decisions made, and the consequences. So, that's what you should be zeroing in on. A knife is only a tool, that can kill or cure depending on how it used. The theory that describes that truth is not to blame for it being used to kill or cure. It's the persons using it. MMT raises those fundamental questions that some people - very powerful people - would prefer remain unaddressed. They can't though, because the consequences are still with us, and will cause problems for those who follow us.
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Thank you for clinging to the truth. We know Farage is an opportunist, and is likely to faik. And we should worry then, because what would follow him. Like vampires, they can't harm you unless you invite them in and tolerate them in your space. So when Nigel fails politically - because he and his party embody the problems we're trying to solve - that in turn will open the door to a much smarter, and more ruthless political entrepreneur to say anything to get into power, and raid the kitty. The discontent is the fruit of what was done over nearly 5 decades of Neoliberal economics, and the pain imposed was a feature and not a bug. And that pain is being still imposed, by an alien and technocratic political and economic culture. So the frogs carefully heated of the last half century cannot do anything but try to jump out of the hot water. And anyone who's been scalded knows, that your mind isn't focussed on cause and effect rationality, but finding something, anything, to take the pain away. Brexit, the Red Wall Collapse, and the trouncing of the Tories are all attempts to find cold water. Nigel would get elected just because Starmer is unrelateable and technocratic, and people are still burning. And they would continue to burn whilst Nigel leaves the gas on. What else would he do? He was one who was happy to turn it up. He and his party are neoliberal to the core, and just want access to the kitty and the power. Farage, if elected would fail too, because neoliberal economics is a busted flush. And he would be elected because he has no other agenda than getting the keys to the kitty. So it's what would follow Starmer and Farage which could even be worse. Starmer needs to understand that his electorate is increasingly alienated, because his type of governing makes little or no sense to them anymore. Why would it, when the pain is still growing? They are angry because promises made back in 2008 have yet to be fulfilled, and seem unlikely to be any time soon. So, more of the same technocratic alienating approach is too alien to increasing numbers of voters. He needs to own his shortcomings, and address his and the ever growing political and economic dangers ahead, or see things get worse. He should not focus on saying anything to get power. He should be brave and develop a vision of the future that will stop Farage and others like him gaining traction. And then execute it forthwith. And "more of the same' isn't good enough.
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JP Morgan was being disengeuous, because credit is money. And he made his fortune by using bank credit. Why? Both currency and credit are commodities that have a financial value, and they can be bought, rented out, gifted, spent or sold. The vast majority of money in the modern age is credit. Get paid your wages by check or bank transfer into a bank account? That is credit. Take out a car loan or buy a house with a mortgage? That is credit. According to the Bank of International Settlement (BIS), 95% of financial transactions in the global economy are made by bank credit. Cash as currency, or specie such as gold and silver, are increasingly rarely used in the day to day business in the global financial system. Even China, allegedly buying gold as a hedge against inflation, don't send it to pay it's bills. They have to exchange it for cash or credit to use it's value.
Once technology made it easy to transfer information quickly or cheaply, the use of currency and specie began to decline in favour of bank credit. So now bank credit is the dominant form of money.
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Please name the emininent professor who said such a thing, because that statement doesn't quite match up the facts. Indeed, reading "England's Cross of Gold" which describes the economic thinking behind the UK’s Gold Standard Crisis under Winston Churchill's tenure as Chancellor of the Exchequer, find that Britain was worried because of its rivals in Europe and America having caught up with it industrially and economically. Not only would Britain be forced into protectionism because of its huge WWI debt to the US, it's trade earnings were being eroded by cheaper goods. That fear drove the government and the unions to agree to a too high value of Sterling under the Gold Standard. Not only did that make British exports uncompetitive, it also created the financial crisis which would lead to the 1926 General Strike. You see America's great leap forward, fuelled by it's industrialisation, and owning most of the war debt from WWI, gave it the power to set the Gold Standard, not Britain. The Gold Standard error would drag on until 1931 when Britain crashed out of the Gold Standard. Britain was rich on paper, but the reality was that it had fallen behind so much that it's economy became destabilised. And the British working class had really tough times in the 1920's. Hence the rise of the Labour Party, and the demise of the Liberals. And 1929 didn't help either. So... I want to know which eminent professor would assert such a opinion, because he's no economic historian based on your comment.
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Even ChatGPT4 acknowledges that, but it should be noted that actual or potential superpowers tend to throw their actual or implied weight around. So, the UK needs to start thinking for itself again, (i.e. Bulk up) because if the Trumpettes have their way, it will be all stick and no carrot. Indeed, an examination of the post-WWII debate between British and American economists on the future of the global economy was the last time Britain had a chance to shape things on a global scale, and the Americans gave them the bird. J. Maynard Keynes wanted an international currency union, with an international credit the Bancor, being used for international transactions. The Americans would have none of that. The wanted everyone to be dependent upon USD, and that's what happened. Looking from that perspective to now, the present rumblings in the global financial system are unsurprising. 'With great power comes great responsibility.' But people get bored too easily.
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1. When the US spends 5% on defence... Well, it's good to lead by example isn't it?
2. I came across a suggestion from Matthias Matthijs and Mark Blyth in an article they wrote for the US journal Foreign Affairs in July 2024. They argue that the UK government could expand its fiscal space by instructing the Bank of England to stop paying interest on commercial bank reserves. Currently, high interest rates incentivize banks to hold reserves rather than invest in the real economy, allowing them to earn an estimated $286 billion (£221.37 billion) in interest by 2033. With that, Labour would not have had to abandon its green investment plans costing $35 billion annually, highlighting the disparity between government spending constraints and central bank payouts to banks. They also claim ending interest payments on reserves would reduce long-term debt projections and facilitate investment at lower rates. The European Central Bank (ECB) has already adopted a similar policy, setting its rate at zero percent in September 2023, which allegedly had mixed results partly because of its immediate implementation, and partly because it passed on the costs of Quantitative Tightening onto the banks, which reduced their margins. But, is there a SMART way to save that money? What do you think?
3. If we don't defend what we have, we will lose it. Yet, there are many ways to do so, and the rebuilding of Britain's soft power is the cheapest place to start. Nework effects are force maximiserz. Therefore, if there's a political and strategic brain inside Starmer’s stodgy head, it had better start learning in the job and fast, because we haven't go time to waste. Starmer needs to find a pair and out Brexit out of its misery pdq. A bilateral customs union and removal of trade barriers would be the first plank wilding a bridge to the continent, and improving the quality of life of British people. He also needs to strengthen alliances ans security networks to, but also if defence spending has to increase, it doesn't have to focus solely on building up armed forces. It could focus in building up defence production, because Ukraine may need alternative suppliers sooner or later than the US. Investment in Cyber defence, and AI R & D is more important that boots on the ground. Money earners would be providing technical expertise to Ukraine in technology, reconstruction, and governance so it's productive capacity can be maximised whether or not it retains only de jure but not de facto control of all its territory for the time being. Upgrading the manufacturing of consumables, materiel, and spares for Ukrainian armaments would help. Financing is piliticised as, Russian frozen assets are being held by Europe, and whether they are added to the pot is a serious matter. But the ECB and the IMF could help with financing for Ukraine to pay for resupply. Boots on the ground is a long term goal, especially as we have labour shortages in Europe. And so on...
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