Turn That Frown Upside Down

(Updated – slides added)

Stephanie Kelton’s keynote address to the students, faculty, and visitors at Augustana College’s (Sioux Falls, SD) Undergraduate Research Symposium on Saturday, April 12, 2014 at 10am. Stephanie begins at 2:40. The topic of the keynote is Debt and Deficits in the Modern Economy. The slides are available below the video.

11 Responses to Turn That Frown Upside Down

  1. This is a good vaccination against ‘negameganumaphobia’ 🙂
    It’s so effective, you only need it once in your life.

  2. Will you upload these slides to SlideShare? Thx.

  3. That’s a decent-sized crowd for a small-city college on a Saturday morning. There definitely does seem to be a hunger for a different way of thinking about politics and economics rather than the standard two-party MSM message, at least the young.

  4. John Turner, Australia

    The subject and the quality of the content were excellent. Like the presentation at the Field Institution five months ago, this article needs to be widely distributed in the USA and Europe.
    I would like to draw the attention of many friends and Australian politicians to the whole article but the sound accompanying the video was terrible.
    It sounded as though Dr Kelton was speaking in an echo chamber, or the smallest room in the house, and someone near a microphone had a hacking cough.
    Would it be possible to have the sound faults corrected?

  5. Is the Q&A available anywhere?

  6. Erick Borling

    Hooray! Although the audio made it difficult to hear this lecture, it’s great to see Dr. Kelton at work promulgating the truth (and with a ‘happy’ spin). All hands (or most) are on deck! Can we get some some more Hudson and Mosler on NEP? Mosler’s blog is mildly boggling to this progressive non-economist and Hudson is rambly (because he’s a genius and struggles to pack his incredible insights into this short life just like Chomsky) and his in-person output is now associated with RT which is an accessibility obstacle for the ‘patriotic’ hoi polloi.

    Was the word negameganumaphobia pelled correctly by MK10? When folk describe the gubmint or the national federal budget as as “too big,” what really behind that reaction is exactly the same as a li’l ol lady small-business bookkeeper being set down to balance the books of any transnational corporation and having her mind blown by huge numbers and a large number of accounts. It’s just fear of numbers and whatever baggage someone has about numbers.

    As to the national debt, just because the sovereign currency can be (for pedagogical purposes) compared with Monopoly money doesn’t mean it’s “funny money.” The gold standard would still require a dollar-denominated value-framework. And exactly analogous to when your Monopoly Game banker issues currency, who cares to add negative numbers to the Monopoly banker’s ledger? The point, as far as how much the issuer of the currency can “afford” to issue; is moot as all MMTers know. While that is perhaps simplistic and too clear for the obfuscatory theoconomist racketeers, let’s hope the tea-baggers or the lefty-conspiracy theorists who subscribe to absurd notions of “economic collapse” get wind of the deficit hawk’s propaganda conspiracy and realize that even homemade IOU’s like “I did the dishes today, this scrap of paper is currency to pay you for doing the dishes tomorrow.” are not theoretically or practically more or less real than fiat currency!
    It will be an invigorating — and even scary — time when that idea seizes the national debate!
    -Erick

  7. Stephanie on speed. Great job.
    You have a real gift for this. Lucky students.

  8. In August 2001 the Australian Senate held hearings on the problems of superannuation .
    I made a short submission then that accords quite well with what Dr Kelton presented.
    I wrote, in part;
    “With an ageing population, it must be remembered that the real future problem is the distribution of goods and services between the various age groups existing over time periods in the future. The problem cannot be solved simply by creating cash savings now. Such savings to date have mainly led to the creation of massive financial institutions manipulating funds in the stocks and bond markets. Competition for assets in this scenario will, and has already, led to inflation of asset values and is one factor forcing the price of homes up out of the reach of ordinary single income families, particularly in major cities.
    The future working population will need to be exceedingly efficient in producing goods and services if the limited working population is to produce sufficient to satisfy their own needs and desires and the products required by the non-working aged and infirm.
    Savings now, in the form of superannuation contributions, only make sense if those savings are directed to making future production efficient. This is difficult as the future is mainly indeterminable and we do not know largely what physical products will be required although health, education, police and defense and similar services are probably predictable.
    Future working populations will resort to inflationary tactics if they are not satisfied that their share of then current production is a fair share and that the asset richer older groups are being exploitive.
    One recent comment I have noted expressed the view that, service industries can only shift wealth around, only productive industries can increase total real wealth.

    • That’s an excellent description of the pension situation. The asset price inflation, as Mosler pointed out, is also driven by tax policies that favour pension savings.

      I’d dispute the notion that service industries are not productive. Many service industries produce intellectual property for instance, such as music recordings, blogs, engineering plans, etc. The businesses that generate such IP are usually classified as service businesses. Or businesses like hospitals (healthy people) or restaurants (full people) or transportation which provide outcomes as products. Much of that product has value beyond financial value in the sense that it can improve people’s lives and much of that value can be traded, hence can be captured tangibly as wealth. Is Google valued as it is for its server farms or for its brand and patents?

  9. joe bongiovanni

    Ca anyone explain how the government being the ‘monopoly issuer of the currency’ comports with the endogenous money system where the private banks create all the nation’s exchange media by issuing debt contracts?
    Just wondering.
    Thanks.

    • Auburn Parks

      MMT has been over this with you 1000 times, and yet you continually fail to understand basic logic.

      Bank credits are NOT US dollars. They are bank dollars on a fixed exchange rate (backed by the Govt up to $250K) to the US dollar of 1 to 1.

      US Dollars are cash and all Central Bank balances, securities and reserves.

      No honest person can make the case that US Dollars come from banks as counterfeiting is clearly illegal.