LateMechanic
No bio...
User ID: 1841
LateMechanic
17d ago
It may be the case when dealing with random commenters on the internet, but that kind of goes for everything right? I'm talking about like Paul Krugman who kept being embarrassed when going a few rounds against MMT economists over the years, and he kept exposing that he couldn't shake some fundamental incorrect starting points like a loanable funds framework.
As for different words, that's definitely a communication hurdle where people feel like they're not speaking the same language. To me it seems to be warranted to actually cut to the heart of what matters with some different terminology, to avoid some pitfalls with peoples' everyday colloquial versions of money, lending, borrowing, etc., and talk about what is actually happening with each balance sheet operation.
But it has to be said that people in finance and central banking pretty much immediately understand MMT's descriptions in a matter of minutes. After MMT started gaining popularity, there were multiple central bank research papers put out saying the same types of things, to help educate the field and wider public, and to help correct classic misconceptions still being taught in economic textbooks. The only people who really struggled with it were mainstream academic economists, who had to try to translate real world explanations into their toy model terms. 'So you're saying that in your version of my model, my drawn curve here should be basically a vertical/horizontal line pushed out over here?'
LateMechanic
17d ago
The core bulk of MMT is descriptive, showing how money, banking, and government finance work, from a fundamental logic & accounting level of interlocking balance sheets. When armed with these correct fundamentals, it's a lot easier to see where actual tradeoffs and choices apply, and to avoid being upset by goofy incorrect gut notions and suffering from various types of cognitive dissonance. If anyone even talks about "public borrowing", they likely still don't grasp what is even actually happening in the accounting plumbing.
The policy prescriptions which some MMT proponents tack onto that descriptive project is probably a mistake in my view. But most of them think that once you understand the real constraints, then some choices (like implementing a Job Guarantee / Employer of Last Resort program) are so obvious and moral that they should always be pitched at the same time, and ended up with a largely progressive following who wanted more of that. You can take or leave those prescriptions though, it doesn't make the descriptive project incorrect.
There is not a single MMT economist who is confused that different countries & currencies have different challenges. By the 2010s when they were starting to get traction after a decade, they probably knew more about it than almost anyone, because this was such a common early dismissal attempt 'yeah maybe they know about the US, but circumstances are special there'. The core logic still works in any situation, and understanding real constraints vs. imaginary or self-imposed constraints is the key thing to get right. There are definitely real constraints and tradeoffs in all cases.
LateMechanic
17d ago
This is rather MMTers poking some fun at other supposed macro experts who don't actually have a correct clear grasp on how money or government funding works. He kept tripping over his words because his intuition was leading him astray, so "government prints money and then lends it" kept coming out. The correct, clear, simple answer is that government prints money in the form of bonds every day, and swaps them with central bank reserves where appropriate (like swapping between $100 bills, $1 bills, and quarters where appropriate, perhaps when trying to ride the bus or go to the arcade). The only clash is that people have pre-existing non-sensical stricter definitions of the word "money", so MMT generally prefers to sidestep a language intuition issue and just refer more broadly to what matters, financial assets.
It's already been nearly a decade since mainstream economists stopped trying to say MMT is wrong, and switched to "we knew that already", so I guarantee you MMTers aren't saying something as obviously wrong as "we can print as much money as we want without worrying about inflation". And it's MMT who has pushed better & better verbal explanations to laypeople of all those interlocking balance sheets in IGI's linked NYFed diagram.
LateMechanic
2mo ago
There's something to be said that the current backwards-compatible syntax for modern C++ will get unwieldy, but there has already been public discussion of attempts to make breaking revisions to it: see Sutter's proposal for cppfront.
And I think the other main one currently would be google's Carbon, which is an experiment from the google LLVM/clang crowd, from their frustration with the c++ committee's hesitance to do breaking changes. They're trying to use good ideas from Rust and others, in a way that's interoperable with c++ files & libraries. Although I haven't heard much about it lately.
LateMechanic
4mo ago
I mean it'll stop the specific problem they had with corruption, which was taking on debt and spending it all on politically connected patrons rather than investing it into more productive uses.
It just doesn't really sound like reality here to me, talking about huge complex government budgets like this. Is the premise something like, they'll do all the necessary & proper spending first, and then at the end of that, if they are still allowed to issue some more bonds before hitting some limit (with some kind of timing, like the last day of each period?), then they'll max that out and give the money out to the cronies? So the hall-monitors from other countries try to perfectly set a limit on them in order to just allow enough for the proper spending which should be prioritized? If the leadership is simply corrupt and untrustworthy, why wouldn't all that 'favored' spending be mixed in with all the 'proper' spending, and the distinction being possibly subjective anyway?
Good governance is hard and I don't know all the ways that other countries and US states for example try to deal with these. The euro monetary union countries definitely have a tricky setup to deal with, without a 'united states of europe' fiscal authority. I can imagine the psychology of being in other countries and feeling a lack of trust of others' behavior. It just seems like everyone is moving away from thinking that arbitrary limits on the fiscal outcomes are workable solutions.
This might be beyond me. What do you mean?
That chart of sectoral balances is the fastest way to really intuitively understand that financial assets are zero-sum. So when we talk about the government deficit, we're simultaneously talking about the non-government's surplus. You can slice everything into any number of different sectors, but a common useful separation is 'government' vs 'domestic private sector' vs 'external / rest of world' sectors.
What we find is that the private sector really wants to be running a surplus at almost all times, because people like to build up savings for security. So that's why in general the government almost always has to be running a deficit, injecting financial assets (money, bonds) into the economy. When the private sector is in deficit, that means people are collectively spending down savings and/or running up private debt, and we see it tends to end with a significant recession where the private sector forces itself back into surplus by cutting spending.
(The other source of financial assets would be the external sector, where a net exporting country runs a trade surplus. Then you could potentially have the domestic private sector and the government both in surplus potentially. On the flipside, if a country is running a trade deficit, then their government deficits need to be even larger in order for the private sector to be in surplus.)
So this is the dynamic 'savings desire' of the private sector. The behavior could be affected by various psychological, historical, cultural factors, and could be incentivized or disincentivized by stuff like tax-advantaged retirement saving, etc. We might find that the Japanese people lose trust in saving for the future by buying stocks, and instead they largely want to build up huge monetary savings for retirement, which could cause the japanese government to need to issue a massive amount of bonds & currency for people to sit on (without any inflationary effect, just having to solve the paradox of thrift and fight off deflation).
I don't think you can chalk it up to aesthetic preferences - for Greece specifically we have the comparison of the modern day vs the post war era up till the oil crisis, during which they kept the budget controlled and growth was steady and reliable.
Going off some Greek sectoral balance charts here (which I would prefer to be flipped around 0 to look more useful) and from the paper they're quoting from. It looks like Greece had a moderate government deficit but their trade balance turned to deficit in the late 90s, which pushed their domestic private sector into significant deficit, probably running up a lot of private debt. Similar to the US at the time in the late clinton-era. Then Greece adopted the euro and was locked into effectively a currency peg with the likes of Germany, which essentially made the trade deficit structural from then on.
So then, during and after the financial crisis and great recession, the private sector was hammered and was trying to de-leverage and rebuild savings, which by necessity is going to force the government into massive deficit (as tax revenue falls and safety net spending rises, the normal automatic stabilizer reasons for this).
If the main moral failing (causing a larger headline government deficit number) turned out to be that they were running a trade deficit and had been suffering a private deficit for a decade, it doesn't really seem that damning. Hard to make corruption & profligacy actually work as a macro story (though I'm sure it's plentiful at the micro level).
LateMechanic
4mo ago
Yeah there's nothing stopping anyone from doing a bad job running a government, but I'm skeptical that austerity is going to significantly hamper the corrupt actors anyway. That often seemed more like a 'just-world' convenient justification in each of the sovereign debt sagas. Greece would have been fine (at least in this sovereign debt regard) if they hadn't given up the drachma, and they ended up fine once the ECB finally realized it was their job to simply fully back all member states.
Any government will need to have various checks against spending getting out of control, such as having a proper budgeting and auditing process. But once you land on the size of government desired, the taxes and especially the debt & deficit are just dynamically emergent results based on the private sector's savings desire and the level of exporting. Net exporters acting like their lower deficits are evidence of good sense & morality is more of that just-world confusion. Trying to force a country to shoot themselves in the foot economically based on those debt/deficit outcomes being too large for someone's aesthetic preference (or bad faith justification) is a destructive angle that it seems people are not falling for as much anymore.
LateMechanic
4mo ago
To be honest, intuitively I would have expected more correlation. But as far as this chart goes, the x-axis doesn't really look like what I'd expect, with almost all countries clumped closely together between .01 and .05, whatever those refer to (I was under the impression covid stimulus varied a lot more, like these charts show). Tracking down this paper from your twitter screenshot, this is Robert Barro who is apparently still interested in his old bizarre idea of ricardian equivalence, where consumers are supposed to be rational agents and thus should respond to government deficits by saving money instead of spending it because they know they (or their descendants) will pay more taxes in the future at some point...So I imagine that explains the strange x-axis here, working in extra variables that are relevant to him wanting to test his specific ideas about rational consumers looking at debt ratios and duration.
LateMechanic
4mo ago
Agreed on all counts I think. But despite the rage and desire to punish, they did have to accept the economic reality and Draghi finally set it right in 2012 with the "whatever it takes" admission, which was correcting the first main issue. Then I think since covid and looking at the 15 years of poor growth, they've been coming around on the problems with deficit limits, which is the second big economic problem. These things reflect what necessary compromises had to be made 30 years ago to get buy-in, and what were the dominant narratives at the time (where central bankers and monetary policy were seen as sufficient wizardry to manage an economy).
LateMechanic
4mo ago
MMT just gives the descriptive reality & logic of how things work now and throughout history, including how the base interest rate is simply a policy tool to subsidize savings (which can be set at 0% any time we desire to not pay that subsidy). Argentina is currently serving as a good example of why giving savers free money, in proportion to how much money they already have (increasing the interest rate), is probably not the tool you're looking for if you want to combat inflation (shocked pikachu there). As for the USD inflation, it appears that most currencies around the world experienced about the same cost-push inflation coming out of covid, while having fairly disparate levels of counter-cyclical fiscal injections and unemployment levels, so it's not as obvious as it may seem.
The Greece point is that the conversation was simply incoherent just 10-15 years ago, but has moved significantly toward productive correct debates about the preferred size of government and inflation constraints, rather than a fear of large numbers and negative-sounding words debt & deficit. So that's my prediction that the world is moving farther away from arbitrary limit rules on those, rather than looking to embrace the wisdom of Germany in 2009 or 1992.
LateMechanic
4mo ago
I think too many people in power have learned from MMT how money, banking, and government finance actually works, so it would probably take a few generations for people to forget those again for debt-hysteria to strongly return. In addition to the plain logic, all the evidence is that strong fiscal policy is the answer to extreme economic crises, rather than a target for blame.
Even the eurozone seems to have learned that their anti-fiscal-policy stances were a mistake and caused the first big crisis to flatline growth for the last 15 years. So the Maastricht 3% deficit limit is finally being scrutinized and softened to allow for better counter-cyclical fiscal policy. And in the US we've gone from Obama being confused and thinking he needed to fly to China to make sure they'll still 'lend' us money, to now the massive covid stimulus packages without a peep about becoming Greece or bankrupting our grandchildren.
Now the conversation is more correctly about inflation instead of solvency. And while regular people do hate inflation, even way more than is warranted, I'd guess that's too nuanced and subjective for much support of a constitutional amendment around debt/deficit.
LateMechanic
4mo ago
The archives of those pages are linked in the first Revolver article, which shows the FBI had been updating the /wanted/capitol-violence page as each person's status changed (leaving each person's 'photograph number' the same). They were putting big red "ARRESTED" labels on everyone and leaving their picture up. The day before that July 1st update of quietly removing Epps, the top 50 people on the page had over 60% marked 'ARRESTED', while only two numbered suspects had been removed (Suspects #36 and #37, and then Epps #16 was removed the next day).
So the removal was clearly not just triggered by a successful identification. Moreover, based on looking at those red Arrest labels, it seems like their priority was roughly similar to the order of 'photograph number', where being Suspect #16 was close to the top (not many marked arrested in the 250-400 range at that time).
LateMechanic
7mo ago
Oh inflation, yeah that will continue and definitely feeds into exchange rates when different from other currencies. In the story about how people thought $100 million was too much government debt in the early 1800s, then $2-3 billion sounded crazy after the civil war, then $20 billion, $1 trillion, $30 trillion, etc., that's obviously also underscoring that over time inflation changes the value of a single dollar. All the prices just have to adjust, which can be annoying and unpleasant but not apocalyptic, especially if the inflation is fairly low/constant over short time frames.
If you print money, then each dollar is going to be less valuable. Increasing the supply of something reduces its price. Say the US printed $50 trillion tomorrow. The value of the USD would fall compared to foreign currencies because each dollar would be worth less
Although more accurately the identity is MV≡PQ where all parts can be independent, bringing in quantity of goods sold and especially velocity, which both can't simply be assumed to be fixed. So if the $50 trillion is issued (and counted in whatever monetary aggregate you want to use) but it just sits in an account, then you can say that M went way up and V went way down, with the price level unaffected.
If the hypothetical is that the government actually pushes out $50 trillion in spending tomorrow, it would massively juice GDP and also a ton would come back in taxes, but yeah the price level would adjust well upward from that kind of shock (with some short-term chaos) and the exchange rate would move accordingly (or more). The question for importing though (and the economy in general) isn't what a single dollar can buy, but what all the dollars can buy. And as for americans themselves, some may wish to say 'this isn't worth the paper it's printed on anymore', but they still have to pay taxes every year payable only in USD, and pretty soon in this hypothetical, the median annual income tax bill might go from ~$15k to $100k+.
There just isn't evidence that inflation or national debt are disastrous powder kegs waiting to explode. On the other hand, every time the national debt was significantly reduced, it ended with our only depressions. Which makes sense, because the government debt is simultaneously the non-government net savings, and things get dicey when you drain the savings from the private sector and force up private debt:
In its first 150 years, the government periodically undertook systematic multi-year reductions in the national debt by taking in more revenues than it spent.
Each of six such sustained periods led to one of the six major depressions in our history. The last three of these crashes were the truly significant depressions of the industrial era.
This is the record:
- 1817-21: In five years, the national debt was reduced by 29 percent, to $90 million. A depression began in 1819.
- 1823-36: In 14 years, the debt was reduced by 99.7 percent, to $38,000. A depression began in 1837.
- 1852-57: In six years, the debt was reduced by 59 percent, to $28.7 million. A depression began in 1857..
- 1867-73: In seven years, the debt was reduced by 27 percent, to $2.2 billion. A depression began in 1873.
- 1880-93: In 14 years, the debt was reduced by 57 percent, to $1 billion. A depression began in 1893.
- 1920-30: In 11 years, the debt was reduced by 36 percent, to $16.2 billion. A depression began in 1929.
What happens when they stop buying US bonds because they know that the only thing backing US bonds is more US bonds to be printed in future years?
That's the 'bond vigilantes' threat story, but it's just not a relevant factor in the real world of governments that issue their own currency and have their own central banks. Even with the self-imposed legal constraint that the Fed can't directly buy treasury bonds at auction or let the treasury's reserve account go negative/overdraft, they still effectively make sure that every single treasury auction goes off without a hitch at the policy rate (even 0% forever if they want). The NYFed manages primary dealer commercial banks who are tasked with this, in order to circumvent the law against 'direct' central bank funding.
Look at how much govt revenue the US is spending just on paying interest.
Yeah I think it's crazy as well, although mainly because I find the argument compelling that they're currently wrong about whether low rates are inflationary / high rates are disinflationary, and that there's good evidence that it's the reverse (so all those years of 0% interest but they couldn't get inflation up to target 2%, and now years of inflation sparked by supply chain issues that stubbornly won't come down no matter how high they raise rates). Precisely because the government is a massive net payer of interest, so raising rates increases government spending, which we would expect to be expansionary not contractionary.
I'd agree with a policy of just setting the FFR at 0-1% and leaving it there, because it's just not a cleanly useful policy lever, and we shouldn't otherwise have any goal of the government subsidizing risk-free savings by choosing to pay interest.
LateMechanic
7mo ago
From wikipedia:
Hmm what someone wrote there sounds like some kind of narrative argument based around fixed exchange rates, but not very relevant in the world of floating currencies. Like when Soros 'Broke the Bank of England', he was specifically targeting their policy peg, and eventually forced them to abandon it and let it float.
As for net-exporting in order to have a stronger currency, that's kind of a self-correcting system with floating exchanges. Countries that want to keep a current account surplus (in order to target export-led demand growth) have to continually buy up foreign reserves and leave them untouched in bank accounts, in order to devalue their own currency to keep their exports competitive, like Japan and then China have done. And the countries on the receiving end like the US have foreign countries intentionally 'saving' in our currency like this, basically benefit for free (as long as we don't succumb to a fear of big numbers from the required government deficit, as the previous FRED graph showed in red, in order for green & blue to both be positive).
But I would say it's still unclear just how exchange rates are at all enabling or making space for borrowing or printing domestically. There just isn't a mechanism there. For the interest rate, the government raising their own interest rate can increase the deficit, but monetary policy can't exactly discipline fiscal policy in any way. The government has the power to levy taxes, has its own currency, and has its own central bank, so I'd think the debt that's gone up for centuries should be able to continue at pace without any economic armageddon.
LateMechanic
7mo ago
What's the premise that a current account surplus allows higher government deficits? It should be the other way around: a current account surplus is the only way you can get away with running a government surplus. Otherwise, if the foreign sector is saving in your currency, and the domestic private sector always wants to net save, then the government has to run even larger deficits because it's all zero sum.
If the government is unwilling to run those deficits, then the domestic private sector would be hammered and run down savings / run up private debt like in the late clinton years until 2008 finally blew up: https://fred.stlouisfed.org/graph/?g=k16a
People aren't going to trade real goods and services for bits of paper forever, no matter how classy and prestigious those bits of paper might be.
Well, people also said that when a million dollar debt was a large amount, and then when a billion dollar debt sounded like a lot, and then again when a trillion sounded like a lot. Historically it does look like this can go on perpetually unless the economy stops working for people pragmatically, fear of large numbers or not.
LateMechanic
7mo ago
Problem is, we’re going broke.
Since 2010, the fund that SSA uses to pay benefits to retirees has been paying out more money than it has been receiving in taxes. At the current rate, the fund's trustees estimate that it will exhaust its reserves in 2033 and be unable to pay full scheduled benefits.
As the annual trustees' report shows every single year, of the 4 trust funds, HI/DI/OASI all have exhaustion dates projected in the near future, but SMI always passes with "adequately financed indefinitely" terminology. Which is merely because of how they were set up differently, with SMI being able to be part of the normal government deficit. There's no reason the other three can't be changed in a similar way, which would be a bit awkward for doomsayers if the trustees report every year said a brief 'all funds are adequately financed indefinitely'.
For who points this out, I've only seen MMTers who are trying to show there's no real fundamental economic viability problem here, rather than an accounting & legal issue with how the rules are currently written. And also Cato writers who aren't big fans of the trustees' flowery language and want it to be more explicit about SMI's potential governmental deficit spending.
LateMechanic
7mo ago
What a weird take. That would be like "oh the joe rogan podcast, what a BIG deal, that's the guy from Zookeeper!" Carolla had one of the most popular podcasts in the world for like a decade and it still seems to be doing numbers in the last 5 years (though I already mentioned it may be dwindling). Looking at it, just within the prior 3 weeks before Hanania, they had Candace Owens, Tucker, and Vivek as guests, each pushing one thing or another, and getting more views to the extent that they're a draw.
I'm even subscribed to Hanania's channel, yet the only reason I knew he had a book out was due to stumbling across this particular mainstream appearance (hence my assumption that he had been doing normal rounds like this, and thus my surprise to learn that it's not the case - taking your word for it, I haven't been searching for him).
LateMechanic
7mo ago
no mainstream conservative figure like a Ben Shapiro or a Steven Crowder has reviewed it or interviewed him.
I was randomly looking up Adam Carolla's podcast yesterday and watched a recent episode, which happened to feature Hanania and his book, so I just assumed he's been making the rounds. He was good and fit in fine as a guest with only a little bit of airtime, although it looks like the youtube views at least are only around 20k per episode (probably better numbers for other audio-only spots).
LateMechanic
7mo ago
Yeah was going to say this. Probably one reason reddit doesn't let mods see author-deleted comments is because there's such a simple workaround extra step (edit to blank or something useless), which only distinguishes between people who know to use it or not. Then again, there are other tools like RSS which pick up the initial posts/comments, so it still is a bit like email where once you've hit 'send', it's out there.
Meanwhile the nice thing about this codebase's change is that you still have access to your own deleted posts (in gray) and can easily 'undelete', which must be similar to what the mods see.
LateMechanic
8mo ago
This isn't the Motte anymore. Look- I wasn't expecting my post to be accepted with applause and universal agreement, but my thought out, nuanced, cited post gets 4 upvotes, while apologia for sexually harassing women (that dismisses out of hand what I wrote) gets 30+?
Although subjectively explaining vote counts almost never works out, this one seems to make sense to me (as a lurker throwing around upvotes).
Your first post framed this as exasperated leaders at their wits end just honestly trying to get men to treat women as fellow humans, which apparently doesn't ring true or sound too compelling to people here. "What's wrong with the men these days that people think this is the only way they will behave?" as a question is totally dependent on the legitimacy & good faith of the premise "people think this is the only way", which is the main contention in most of the other top-level replies.
The_Nybbler seemed to cut through right to the key point, that attractive/desirable men are going to keep winning in online dating regardless of how many rules they follow or break. So making more punishments and penalties available to women to use against men they aren't interested in is continuing the same one-sided trend we've been in, which can feel unfair and avoidant of root issues.
Then you spun that into a long and somewhat interesting comment (though with about 3 too many links) about how we're screwed if we just let 'cheaters' win, which also characterized persistence in the most nasty way 'lying/manipulation/harassing to get laid'. But the point wasn't that we let cheaters win, it was that desirable men win online dating whether they cheat or not.
So to an average observer, it looked like you had perfect form and a great-looking swing, but you just whiffed the ball on both swings. Meanwhile The Nybbler had a bit of a lazier swing but nailed the ball square-on. Hence you not being downvoted to oblivion or anything, but just receiving merely mild internet reward points.
LateMechanic
8mo ago
The real magic here is in the fact they sell miles from their loyalty programs to other companies (like AA to Hertz) so they get the incentive benefits. These are sold at a markup
I think that's a smart evolution of the business, although I wouldn't say there's any particular magic in this step either. This still falls under the universal logic of IOU issuance: anyone can issue their own IOUs (printed from nothing) and decide both what it takes to get one and what the redemption value will be.
I guess what moves it to feel more 'bank-like' is that the airlines take tracking accounts in their database very seriously, compared to less serious bearer punch-cards for free Subway sandwiches or whatever. And flights are more universally desirable, compared to more subjective businesses. Maybe I will use Hertz instead of Avis if it's giving me $X towards my next flight on my usual airline, but for some reason if they were partnered with Mcdonalds reward points, it would take a lot more than $X to move the needle.
LateMechanic
9mo ago
Awesome, thanks! Interesting to hear what that compatibility issue was (sounds like a handy operator). I probably do need to jump to Basilisk or just finally give up on XUL addons and go back to Firefox, but you may have given me a final stay of execution
Strange yes, although I realized it was very similar to how the stackexchange sites broke backward compatibility with older browsers 1-2 years ago for comment collapsing/uncollapsing. And I knew that was fixed for waterfox in a later update. So I just tested it and found the release was 2022.06 where they said "Web compatibility improvements to fix breakages across a variety of websites". In waterfox v2022.04 comment collapsing is broken on stackoverflow and in the new motte as of a few days ago, but both working fine in v2022.06. Just unfortunate for me because that's all after the 2021.09 version update which made their whole browser way slower, which kind of defeats half the purpose of using an older nonstandard browser.
Yep I get it, and I'm resigned to using different browsers for a few sites that break over time. Just seems crazy that simple things can be incompatible, but I don't know my way around javascript or github to spot how after working forever, now onclick "collapse_comment" reference could be not defined for me starting ~2 days ago. edit: I think a version update will fix it on my end, so all good
LateMechanic
10mo ago
Just noting, something in the last day or so broke that collapse/uncollapse functionality on this waterfox classic browser (both the +/- signs and the vertical bars)
It seems like your deep dive was not into primary MMT sources, but rather critiques from the outside? Your post sounds like you were just following the attempted dismissal from like a Sumner/Rowe/Noah Smith, at least from when I was following along 10 years ago.
If you were reading anything from the main MMTers themselves, you would surely have seen them counter these dismissals a hundred times. You would surely have seen that the main thing they talk about is about how fiscal policy already manages the macro system with automatic stabilizers for the last 80+ years, not requiring congress to manually fiddle with tax rates all the time to respond to demand and inflation. And you would have heard Wray say in every book or every talk that we could certainly get some demand-pull inflation before true full employment if simply pumping fiscal stimulus via general spending, which is a demonstrated lesson from the 60s keynesians. If those were 2 of your own 3 conclusions from an actual deep dive, and you weren't just re-presenting a critique you heard, I don't really know what to say.
I do agree that a full discussion is a bit pointless and frustrating. In general I'm perfectly content with how economists, central bankers, policymakers, all the way on down to average internet commenters, have shifted a decent amount in the last 15 years toward the MMT explanations. From what I see there's a lot less of the really goofy misconceptions (we're borrowing from china, we're broke, central bankers are wizards, interest rates control the price level, banks are lending out reserves, QE is printing money, etc). So to the extent that the dismissal of MMT is "we already knew that" or "I don't agree with their progressive policy prescriptions", it works for me.
More options
Context Copy link