Do the Democrats Really Want to Bear the Blame for a Crash that Wall Street Will Cause?

By Joe Firestone

This post by Lynn Parramore makes the point that the next crash is coming and probably will be blamed on the Democrats. It’s a great point, but it needs to be pursued further.

What if we have another Republican sweep in 2014, like 2010, but worse? Then we’re going to have more policies that increase inequality. Even less regulation, causing even more domination of our politics by corporations and the financial sector.

We’ll have more military spending and more wars, along with more shredding and privatization of the social safety net. We’ll have even less environmental regulation, and even more global warming; more drill baby drill, and less and less of public education. At the State level, we’ll have more of the war on women, blacks, seniors, and hispanics; more corruption from corporations and the rich giving “gifts” to officeholders; more voter suppression, even more police brutality and denial of first amendment rights, more religion in our schools accompanied by more guns everywhere, and more Scalias, Alitos, Thomases, and Robertses subjugating everyone to corporations.

And what’s frightening about all this is that the people who want to see this kind of America, also are the people with the power to gamble irresponsibly in the international financial innovation products gambling casino, and to bring about the very crash that will be laid at the door of the Democrats. Of course, the Democrats deserve this because when they had the power in early 2009, all through 2010, they cared more about the filibuster in the Senate, and their campaign contributions, and their possibilities of lucrative work after Congress, then they did about economic recovery with full employment, taking the big banks and Wall Street down, and getting truly universal health care through passing an enhanced Medicare for All program.

But whether they deserve it, or not, doesn’t change the likely result of a Republican sweep. It will be a disaster for most of us, even worse than the sweep of 2010, because now the Republicans are starting from a stronger position in the State and Federal Governments, and afterward they are likely to be even more unobstructed in working their will than in the past.

The only way to avoid another crash that would be blamed on the Democrats, is to act decisively to get the financial sector under very tight regulatory control, as soon as possible. But, in turn, to do that, we must hope that there is no crash before the election of 2014 and also, if we can get there without a crash happening first, to then manage a sound Republican defeat in that election, so that the Democrats can get back the House and keep the Senate. But how can that be done?

In only one way. The Democrats must bring about a radical change in the American political climate that places the burden of the Federal Government’s continued failure to ease the declining economic state, and anxiety about the future, of most of us, squarely on the shoulders of the Republicans, while leaving no rationalizations, or excuses the Republicans can use to place blame for those failures on the Democrats. The way to change that climate lies with the President and the Democrats in Congress.

The President must put an end to the normative standard of mandating fiscal neutrality for domestic programs and non-emergency domestic legislation having fiscal implications. When every fiscal policy initiative is evaluated first for its fiscal neutrality, rather than for the balance between its anticipated real costs and benefits relative to public purpose, then green eye shade private sector accounting norms replace the public purpose as the goal of government policy. The President can and should make fiscal neutrality an obsolete standard, by ordering the Secretary of the Treasury to have the US Mint produce a $60 Trillion platinum coin, and then deposit it in its Public Enterprise Fund (PEF) account at the New York Fed, where the Treasury can fill the Treasury General Account (TGA), the public purse, by sweeping the seigniorage from the PEF.

The President should then announce his action and explain its implications including:

— The seigniorage from the $60 T coin (nearly all of the $60 T) would be used to pay off all Federal debt subject to the limit as it falls due, so that eventually all such “national debt” will be paid down to zero.

— The seigniorage can also be used for 15 – 25 years to remove the need to issue any new debt instruments when the Executive wants to spend Congressional deficit appropriations.

— The US Treasury now has plenty of money to repay all previous Treasury debt and to perform all deficit spending Congress is likely to appropriate for a very long time to come.

— The President’s action in minting the coin will not cause inflation because first, the $60 Trillion in Net Financial Assets (NFA) now in the public purse will only enter the economy in the form of reserves as the national debt is gradually repaid, and as deficits appropriated by Congress are spent. In itself this gradual injection of reserves into the economy can only cause inflation if Congress appropriates too much deficit spending. So, as long as Congress doesn’t deficit spend beyond full employment there will be no demand-pull inflation.

Once the President has the coin minted and deposited, the key factor in the present political climate, the fight over debts, deficits, and “fiscal responsibility,” the rationalization for not deficit spending what’s needed to end “the long depression,” won’t be relevant anymore. The key fiscal policy issues then will be the need for full employment vs. the possibility of inflation, strengthening the social safety net, reinventing energy foundations to get rid of fossil fuels and stop global warming, fixing our declining system of public education, and reinventing our infrastructure. So, political fights will be over these things, not over debt ceilings and deficit reduction to slow the growth of the national debt or begin to pay it down.

The Democrats’ role in Congress at this point should be to try to pass a legislative agenda that is clearly about “justice for all” beginning with tighter and tougher laws regulating banks, Wall Street, and the financial sector, and continuing with legislation providing for economic and social justice, including a Federal job guarantee program that will, create full employment at a living wage averaging with good fringe benefits, a Medicare for All program that will stop all the fighting over the Affordable Care Act, and also provide truly universal and accessible health care, a substantial increase in Social Security payments of at least 50%, an infrastructure program spending $400 Billion per year over five years, and a Manhattan project to replace fossil fuels over 10 years using solar, wind, geothermal, and hydroelectric power, and electric cars at $400 Billion per year.

Of course, none of this will pass; but the purpose of trying to produce this legislation is not to pass it immediately, but to make it clear that the Democratic Party is going back to its roots of legislating for the “have-nots,” and achieving a greater measure of economic and social justice and equality, and that it has a program that will do things for most people rather than for Wall Street, and that it is promising to enact that program, come what may, if it gets majorities in both Houses of Congress.

The Democrats did not produce legislation enacting such a bottom-up legislative program when they last had full control of Congress in the period 2007 – 2010. So, to be credible to the public this time around, they will have to offer some pretty strong guarantees, including a guarantee to end the filibuster and restore majority rule to the Senate. But that is as it should be, since in buying off on neoliberal ideology during the Carter Administration, they have done little but practice the trickle-down theory of public well-being since then.

If they do these things, however, then the Democrats will have a good chance to regain political power in 2015, and will have the opportunity to both avert the coming crash by bringing the financial sector under control and also bring an end to the long depression. So, there is a way out for them and for us. They need not get blamed for the crimes of Wall Street and the next crash and the hardships thereafter. If the President will cooperate they can avert their fate, save themselves from another “wave” defeat, and win a victory large enough to pass the program they promised.

Or, alternatively, as I expect them to do, they can just hang on, playing small ball until the next crash. But the odds are that if they do that, and either this President or his likely Democratic successor still have the presidency, then the Democrats will take the blame for that crash, and that the rest of us, in a paroxysm of frustration and resentment, will deliver ourselves into the hands of those who will whip us with scorpions.

41 responses to “Do the Democrats Really Want to Bear the Blame for a Crash that Wall Street Will Cause?

  1. The GFC was effectively the consequence of a “Libertarian bubble” signed off on by both the Democratic and Republican parties. There is little evidence the Democratic Party has recognized this.

    • Schofield, not sure what you mean by “a liberatarian bubble.” How do you define “libertarian”? And, why a “bubble.”

      • I’m using using the word “Libertarian” in this instance as a pejorative in the sense that the “bubble” was a consequence of “dissassociative” economic thinking. In particular there was a failure to understand that relaxing financial regulation would allow such a huge build-up of real estate debt it would negatively impact the Real Economy, the non-financial sector or sectors of the economy by reducing demand. In other words the bursting of the bubble would create a balance sheet recession because like a Neutron bomb which kills the people but leaves the buildings standing debt would be left to be paid down to make balance sheets whole again particularly business ones which have to reflect market value reality by law.

        You can use “Libertarian” in a non-pejorative or positive sense when you consider the case of Galileo and the Roman Catholic Church. In the Dark and Middle Ages the Roman Catholic Church was a safety net, a sort of welfare state and to achieve this like all religions it stressed the importance of human cooperation. To this end, however, it foolishly attempted to reinforce its argument by preaching that God had made the Earth the center of the Universe with the Sun revolving round the Earth. Galileo held out for as long as he possibly could, tried hard to hold out against a Leviathan that was intent on pursuing “dissassociative” thinking in the name of a good cause not dissimilar to the Libertarian argument that government regulation stopped the finance market working as well as it could. As MMT consistently argues this ideological assertion is “dissassociative” because it fails to understands that the creation of money is a partnership or “cooperative” arrangement between the government and non-government sectors that has to be regulated and indeed macro-managing by the government sector. In reality in human societies you therefore have negative and positive “dissassociative” and “cooperative” thinking or ideologies which human beings struggle to balance.

  2. It’s difficult to understand why the Democrats don’t see what’s coming and take the actions you have described. My guess is that they don’t have any leaders, or even potential leaders, who see how PCS can be implemented and the ramifications of taking fiscal neutrality off the table and depositing it in the trash bin of history. If just a couple of influential Senators or Representatives were to step forward and lay out the logic, I think many Democrats would follow along even if they were not totally convinced because no other viable alternative is available, and the alternative of doing the same thing leads to such a hell hole. If no Democrats can be found to lead, perhaps a few Greens can be elected from safe seats in 2014, assuming that’s not too late.

    • charles fasola

      Hey, I had dinner with Santa and the Easter Bunny last night; while cows were jumping over the moon and this guy with piercing eyes was laying hands upon and curing all these people with terminal illness. It was really, really amazing! Sort of like the belief that this criminal, corporate enterprise you call representative democracy, our government, will all of a sudden begin serving public purpose. Wake the f&^K up! Are you actually delusional enough to believe the Dumb-o-crats or the Tea-Repuglicans give a rats ass? As for believing a third party like the infantile Greens, will be capable of working within the current Stasi State and create necessary change, those pixies and fairies you surely also believe in will serve you much better. The reality is your entire government has been captured by and serves only the interests of those who can offer bribes consisting of campaign contributions, lucrative speaking engagements, and employment upon their leaving (laugh) public service. Take your heads out of your rectums and face reality. If you desire government which serves public purpose, the rule of law, which cares about your constitutionally guaranteed rights, then forget about working within this system and support groups that wish to change it, completely. Forget your belief in capitalism, the free market, and mass consumerism. Stop trying to convince yourself that amerikans are anything special. Accept that the amerikan government and the intellectually lazy amerikan public are the problem; not the answer. There are alternatives. The democrats will never be a part of them. Work towards the absolute destruction of financial sector dominance and financial capitalism and the mass inequality it creates. Work for the complete destruction of the corporate capitalist state; fascism.

      • Again, in this post I’m not saying what will happen, just what ought to happen.

        “Forget your belief in capitalism, the free market, and mass consumerism. Stop trying to convince yourself that amerikans are anything special.”

        I don’t believe in any of things, not am I trying to convince myself of anything. I’m laying out what I think people ought to do.

      • I agree the first step could and should come from the White House, but given Obama’s track record on PCS, I don’t see much chance of that happening, unless the tea party Republicans are able to shut down the government and/or cause a Treasury default. In that case Obama might finds PCS is his best alternative. I was trying to find a way around the White House resistance.

        • Sun, I think the Rs plan is to pass a CR, and then use the debt ceiling to threaten a default and force postponement of Obamacare. At that point Obama can give in, let the default proceed until Wall Street screams loudly enough to get the Rs to back off, cite the 14th while violating the debt ceiling, use the coin, or debt instruments that don’t require repayment of principal and so don’t violate the debt limit. So, what do you think is the relatively likelihood (not probability, that’s different) of each of these choices?

          • I agree that you have described the Republican plan, at least the plan John Boehner has in mind. I think the tea party Republicans would just as soon shut down the government by withholding all funding in order to try to derail Obamacare. Assuming that cooler heads prevail and a CR is passed, we then get to the debt ceiling. If the tea party R’s have to give in on the CR, they will be adamant about the debt ceiling. I think its extremely unlikely that Obama will abandon his signature piece of legislation and really his legacy so I don’t see him giving in. That leaves the three options. I would say Obama is most likely to let the gov. shut down (a la Clinton) and hope Wall Street will force the R’s to raise the debt ceiling. If that fails, I think he would cite the 14th Amendment and exceed the debt limit before he would choose consoles or mint the coin, with consoles having a slight edge over minting the coin, mainly because he has already rejected the coin but consoles have not been much discussed. That’s not the choice I would make, but then I’m not the Pres.

      • Charles, I assumed you are armed to the teeth and are ready to take on the fascist state and its army. Good luck!

    • I think the first step here must come from the White House. If that $60 T coin is minted, then some in the Senate and House will push a much more aggressive fiscal policy because there will be no good reason not to do so. Without the change in climate caused a finally having a full public purpose, it will be years before politicians overcome their fear of “the debt.”

      • Hope springs eternal, I guess. But, sadly, an ice cube has more chance of forming in Hell than a high-value platinum coin has of being minted.

        For the foreseeable future, the mix of highly concentrated wealth, 1% dominance of the media, private financing of public elections, the government/corporate revolving door (need I continue?) makes government of, by, and for the 99% a pipe dream. The choice between Democrats and Republicans is and will remain one of marginal difference, at best.

        Reviving American democracy will take vision, patience, hard work, and courage. And a readiness to accept that success is not guaranteed.

        Progress will be “1% inspiration and 99% perspiration.”

        • See my reply to Sun above. It’s not about the probability of his using the coin, but the relative likelihood of his making one choice out of a limited set that will be facing him. I think the likelihood is that he will choose the coin. Whether he will go with an HVPCS alternative like the $60 T coin is a lower likelihood.

  3. It might be convenient to lay the blame at the footsteps of the GOP, but the democrats in office are just as beholden to the interests of the business elites. The major difference is how the parties spin it to their base; speaking as a registered Republican (particularly pissed about the continued lies about “ending illegal immigration” while passing amnesty during ever Republican president and the complete glossing over the fact NAFTA ended Mexican Farm subsidies), I think some of your proposals are abit soft. First, if Richard Koo is correct about overall asset/debt levels preventing expansion, then inflation during a stimulus process is perfectly acceptable not only to improve employment but to reduce the value of debt and raise asset price. Second, the proposals you suggest are actually quite tame; I’m a bit of a Pop Sci geek as well, and our technological infrastructure is outdated. How about a five/ten year program to build high-speed (preferably MagLev) rail, net-positive housing standards, a geo-engineering corps, and creating a GSE for aeroponic factories for cheap, pesticide/hormone free foods that could feed those on or needing food stamps, as well as vouchers for 3D printers and internet? There’s no reason we can’t have free-ish food, energy, healthcare, internet/phones, as well as cheaper transportation costs and healthier planet; I’d even suggest far more for NASA, since a 9-month trip to Mars is about the same as my ancestors getting to this continent and private industry certainly has proven it’s incapacity at getting into space (forty-four years after the moon landing, they still haven’t figured out how to get past LEO? So much for being more effecient & effective!), and it’s not like the US couldn’t eat the cost of these big, international projects such as ITER on it’s own.

    • I’m not solely blaming the Republicans. Clearly the Post blames the Democrats too in it’s very plain about their no longer serving the people. On the rest, I’m down with advanced rail projects. I see that as part of infrastructure re-invention,and I’m also down with more investment in Space. But I think we need to prioritize to reduce inequality, which is dangerous to our democracy. That means an immediate Job Guarantee program, Medicare for All, augmenting the safety net, and some of the other things I’ve named above. I’m saying first things, first, and especially proving to people that the Government never can run out of money.

      • I’m aware you blamed Democrats, somewhat; but blamed them for compromise. As Mr. “Santa and the Easter Bunny” above noted, they’re part and parcel of the corporate government, the other side of the coin- the GOP rails against regulation and taxes, the Dems argue for “spending” and “stimulus”- but just enough to prop up ineffective geo-engineering companies and to protect financier’s interests against excessive deflation. Prioritizing against inequality is a good idea, but I don’t believe spending policy itself can correct the inherent inequality in our system; further opening up credit unions and co-ops is a regulatory approach. However, I do agree that an aggressive spending policy is important, but would focus more on capital than entitlements- expanding healthcare coverage aside (and, as noted in another article, increased coverage will drive down costs and most likely be cost-neutral), it’d be better to expand HUD grants in collaboration w/ homesteading programs as a means to rebuild neighborhoods, and net-positive housing would dramatically change the energy landscape. Similar technology exists that could provide people w/ cheap, healthy food as well if we provided the start-up capital (a GSE would work fine), allowing food stamp recipients to eat better than corn flakes and microwaved burritos. Part of the issue is to be forward-thinking; the TVA had a far greater and more lasting impact than the CCC, and a job’s training program would do more to enhance our human capital than simply shuffling the unemployed from UI to a job’s guarantee. If we’re saying first thing’s first, we need a program with a lasting impact, that drives home a cognitive shift; the New Deal couldn’t do that, and a smaller stimulus program won’t, either.

        • I certainly didn’t propose a stimulus program; but a full employment program and it included enough deficit spending to compensate for aggregate demand leakages from savings and a negative current account balance. On the lasting impact of New Deal projects, I think you need to read some history. We are still living on many of the New Deal projects from FDR’s Administrations.

          But in any case, an MMT job guarantee program would not merely be a rerun of New Deal projects. The projects would be locally defined according to local perceptions of what was valuable and needed to be done. In addition, the input of the JG employees would be taken into account as well. The role of the Federal Government would be paymaster. There would be many green jobs involved and also much urban reclamation is local people see the need for that. Above I linked to Pavlina Tcherneva’s video on this subject. I recommend you watch it, if you really want to know what the JG is about. Don’t make assumptions about the proposal based on other tings you know about that are not the same. There are echos of the New Deal in this; but it’s not just a warmed over New Deal proposal.

        • Oh, and one more thing. I’m not blaming the Democrats because they compromise all the time. I’m blaming them because they’ve bought into neoliberalism lock, stock, and barrel, and all they do employ a bit softer version of it than the Republicans do.

          • I’m aware a number of New Deal projects still exist, but others do not (CCC, for instance). My point was not that they were abandoned completely, but that they didn’t cause a cognitive shift in how we view economics, or else we’d not be having this discussion right now. I’m arguing we need a project both large and foresighted enough to fundementally shatter the preconceived notions of how the economy and monetary system operates; to do that, I favor physical capital investments that would directly change our entire material economy, from net-positive housing that would change our energy paradigm to improved transportation and aeroponic investments. The purpose of vouchers for 3D printers and other cutting edge technology, such as iWatch or Google Glass that feed into ubiquitous computing, is precisely because these technologies having a reverberating social effect as well.

            I certainly agree with the notion of a Job Guarantee, but I do firmly believe that we ought to focus on physical capital above entitlement programs. Make-work projects serve no greater purpose than UI if they’re not foresighted in what they attempt to accomplish; I’d much prefer geo-engineering and science projects as a means of increasing employment, even indirectly. If you mean we should offer the unemployed, underemployed, and drop-outs work-training on a net-positive homesteading/revitalization project, I’m completely in agreement, or if you mean for building high-speed rail. However, what we need to accomplish isn’t just “look, we fixed a few things”, but to make people fundamentally change the way they see sovereign currency. In order to do that we need a five-ten year plan that dramatically changes the way society operates.

            • See: on CCC accomplishments, many of lasting value.

              On changing our view of the economy, I think New Deal projects did that. The view of those living through the New Deal and the early years of the post-war economy was changed, and that changed view was pretty stable until the 1970s.. Then there was a strong conservative counter-attack, which changed attitudes back toward market fundamentalism.

    • What is it with this train obsession? Passenger rail transport requires dense human habitation patterns. In areas where those conditions are met, it is successful. Where those are not met, it is not. Humans seem to prefer to live on ranges rather than in hives. Even in dense areas, the preference for the freedom of self-directed travel modes and directions leads to, and sustains, high road traffic before it leads to high public transport traffic. There are some technologies being developed, like networked automated driving and low emission vehicles, which achieve some of the positives of public transport while recognizing that human preferences.

      • Last time I looked, the Eastern Seaboard from Washington DC north to Maine was pretty densely populated as was the West Coast. The North Central States down through Ohio, Indiana, and Illinois were also pretty densely populated. Seems to me there’s more scope for rail in these places, as well as in urban/suburban metro areas. I also think there’s a need for cross-country long distance rail using very high speed trains. A lot of people would ride high speed trains rather than fly if we had our own version of the bullet trains.

      • On top of what Firestone said, of metropolitan systems and long-distance travel, there’s also the issue of transporting goods and materials. I’m a country boy, so you don’t need to tell me twice that I still need a truck; on the other hand, people drive into the the city or grab a taxi to the airport for long distance travel. What you’re completely forgetting, though, is about 70% of our fuel consumption comes from truckers transporting goods. CSX, on the other hand, has made a campaign of pointing out they can take 100 tons 100 miles on a gallon of gas; an even more effecient high speed rail system would make that more effecient, and simultaneously eradicate nearly 70% of demand on fuel. I just left a warehouse/assembly job a few buildings down from CSX, where we had trucks pull in all the time to either give us material or ship out poles. We could easily have had a rail line to the train depot instead, and back home we have a bunch of empty factories next to an unused rail line. With the extent of Industrial Parks down here, rail lines through them could easily cut down transportation costs, and that could easily drive down gas prices as well.

  4. The enlightened few grasp at straws. “Perhaps” this, “perhaps” that. Mostly, it ain’t gonna happen, as far as I can see. The fundamental flaw we recognize is that there is little-to-no functional difference between Democrats and Republicans; from Obama on down, they’re all on the same wrong path, working for themselves and Big Money rather than for the good of the nation and its people. Starting in mid-2009 I started calling Obama a Republican; it’s simplistic but it helps me understand why he keeps doing all the harmful things he does. Can he be convinced to reverse course on almost every issue? Not likely. Since 1980 we have been in effect a Republican nation, with Democratic politicians and voters playing along. It takes many miles to turn a ship. We must keep working at it, but it’s tough to be optimistic that we can fix all that needs to be fixed before we hit disaster again.

    • Look, I know the narrative you’re giving very well, a lot of the time I feel exactly the same way myself. But, I think you’re over-generalizing about the Democrats. certainly the leaders of the Party in Congress and the President too are Republicans in disguise. But they are not today’s extremist Republicans. A good comparison is Bloomberg; they are his kind of Republican. They are close to where Ronald Reagan stood. On the other hand, many of the rank and file Democrats think differently and are much less pro-business. Given half a chance they will vote differently.

      Further, I didn’t say I was optimistic about the future. I specified what people ought to do in this post. I didn’t try to say what they will do, except that I predicted that the Republicans would not pass progressive legislation even under pressure from a full public purpose, and because they would not that gave the Democrats a chance to win in 2014.

    • As a registered Republican, you need to stop pretending the Dems are supposed to be any better. So they bitch about the rich while deregulating business; it’s no difference from the GOP bitching about the rich intervening while support too-big-too-fail or effectively barring Tesla from selling in NC. It’s just two sides of the same coin, and more and more we’re getting sick of this TEA party libertarians who bitch about “RINOs” when they stand for nothing conservative whatsoever. Where’s the family values in letting the parent who raised you go broke in a nursing home before medicaid will cover it? Where’s the conservationism in “fuck state parks, drill baby drill”? What we need is for the Eisenhower-Nixon Republicans to take the party back from these Reagan worshiping hacks.

  5. I hate to admit it, but I cannot find any evidence to disprove your analysis. It fits the long-term pattern of America’s neoliberal self-destruction: Carter paved the way for Reagan, Clinton paved the way for Bush 2, and Obama’s too-big-to-failism will pave the way for a level of reaction which is going to make Bush 2 look sane. Good things are happening all around the rest of the world, but for the heart of the Empire, the Ice Age is coming, and we need to be prepared.

  6. Pingback: Do the Democrats Really Want to Bear the Blame for a Crash that Wall Street Will Cause? « naked capitalism

  7. I agree about the ice age. But each of us should make an honorable fight in our own way to avoid it.

  8. Modern Money Theory (MMT) is a logical interpretation of how taxation and finance works in an economy with its own fiat currency. Although the movement has been around for some time now, it has not gained much traction with the economic community, let alone the electorate. The main reason is that it has been an academic and intellectual movement, when in reality, it is more than that. Faced with competition from the outdated economics of the gold standard and the austerity movement which accompanies it, it must expand into a political movement. It’s competition is highly political with organizations like the Peter Peterson foundation and neoliberal think tanks funding propaganda and the Tea Party movement to hang on to old thinking, while MMT embraces a more realistic approach appropriate to our fiat money centered economy.

    MMT is more than finance and taxation. It embraces a jobs buffer to keep people employed to maintain their skills and esteem, making a transition to private employment and upward mobility more possible. It emphasizes productive activity rather than speculative activity to promote real growth. It recognizes demand as the main driving force in the economy, not accumulation of capital that sits on the sidelines. To implement these principles requires political action. This requires funding for grassroots education and recruitment of political candidates who understand and will promote it at the precinct level and for advertising to counter the political actions of the neoliberal austerity advocates.

    It’s time to find substantial donors who will fund a political action committee to this end and to start a program of individual contributions from the rank and file if MMT and its economic and political aspirations are to become mainstream. Warren Mosler’s political campaigns have demonstrated that a wider political approach is necessary.

    • We certainly can use this.

    • Stephanie Kelton for president?

    • Part of the problem is fighting for MMT on a grassroots level when it requires a sovereign currency. I just moved down to Kentucky and am meeting up with some people who are fighting to revitalize the town; there’s a lot that needs to be done, but the major challenge is trying to expand liquidity w/ out control of the currency. The best I could think is offering bonds.

      • They should be supporting State revenue sharing in recessions and during recoveries.

        • joe bongiovanni

          Joe, so true.
          And, lest we forget, a cornerstone of the Kucinich Bill, HR 2990, is the SHARING of the money-creation power with the states so that twenty-five percent of all new money creation would go directly to state-determined programs.
          Last 10 years averaged about $540 Billion of new money, so that after a transition to public money creation, Kentucky, population 4.3 million, would receive about $1.75 Billion……..Annually.
          The new solution on access to public-good money is Thinking Locally, Acting Nationally.

  9. Plans requiring sensible action from the President are forgetting this Presidents history as one of the greatest Republican Presidents ever. His policy is written by Wall Street and will only turn around to regulate them is someone else came along with a bigger cheque book to line his pockets with. Unlikely I think.
    If the Democrats want to save themselves they need to dump their Wall Street contributers and lobbyists, stop supporting Obama just because he wears their T-shirt and either somehow take control and change things or make very clear their policy and their opposition to todays government so that when the crash comes they don’t get blamed.

  10. joe bongiovanni

    To a degree, everyone agrees that the two parties to the political process play no role in the determinations of outcomes that are rather determined by the corporate finance world.
    If Wall Street doesn’t buy your election, they will buy someone else’s.
    In closing the Preface to his book “The Role of Money”, Dr. Frederick Soddy had this to say about what has become our present system.
    “It (the book) is concerned less with the details of particular schemes of monetary reform that have been advocated, than with the general principles to which, in the author’s opinion, every monetary system must at long last conform if it is to fulfill its proper role as the distributive mechanism of society.
    To allow it to become a source of revenue to private issuers is to create, first, a secret and illicit arm of the government and, last, a rival power strong enough ultimately to overthrow all other forms of government.”

    The tragedy remains MMT’s inability to understand that they are defending a money system that is working against their objectives.
    We need a new role for the money system.