The Radical Imagination: Imagining Economics in an Age of Stein, Clinton, Trump or Johnson

NEP’s Randy Wray appears on The Radical Imagination with host Jim Vrettos. Topic of discussion is the science of economics and what a U.S. economy will look like under the administration of Stein, Clinton, Trump or Johnson.

View directly on vimeo here.

13 Responses to The Radical Imagination: Imagining Economics in an Age of Stein, Clinton, Trump or Johnson

  1. Surprised by the question @ 27:40 “How are we going to pay for it?” Did the interviewer not do any research on MMT beforehand?

  2. J. Steven Livacich

    The basic question about Universal Health Care, and the question of “single payer healthcare” versus private healthcare companies on a statewide series of exchanges, “Affordable Health Care” plan (“Obama Care”) is how much actual capital can be afforded to health insurance as opposed to the investment in other forms of funded insurance. Consider that the insurance industry as a whole as having more than half or about 55% of the investments in the US–including stocks (common and preferred), bonds, and mutual funds. Of that percentage, of the insurance industry , the Life Insurance industry (defined as “death and disability”, under the law) has about 70% of the assets and the remaining type of coverage, “property and casualty”, liability and “life – health” which is what health coverage is termed. Considering that the life insurance was a three trillion dollar industry about the time the GNP was turning one trillion dollars it is fair to question how private investment could possibly provide coverage. Where will their money come from? JSL

  3. J Christensen

    You are a true hero of our times! Very few people could bring such clarity to such murky waters.
    The idea behind capitalism is sound. The misuse of the name and the attempts to rewrite the purpose are not.

    • I think not — the idea behind capitalism is for the owners of the means of production to gain profits by exploiting the workers without having to produce aything of value themselves. Capitalism is not the same as doing business or entrepreneurship, etc., all of which can be done by worker owned and run businesses, which can even be very large companies (such as Mondragon).

      • Howard Switzer

        I think defining Capitalism as “private ownership of the means of production in order to exploit the workers” is a rather anemic and much too narrow a definition. Capitalists can hire people to “own the means of production and exploit the workers” for them while they create money for speculation and manipulate governments into profitable wars etc. I think owning the means by which money is created is a much more powerful position and Marxist/socialists have a history of being used by Capitalists in derailing monetary reform largely because they imagine they know what they are talking about and they don’t. Marx didn’t know how money was created, he imagined it was all based on precious metals. He was a great philosopher but a poor economist, which I guess qualified him to be the London economic correspondent for the New York Tribune.

        • That’s pretty much the usual definition:
          https://en.wikipedia.org/wiki/Capitalism
          “Capitalism is an economic system based on private ownership of the means of production and their operation for profit.
          […]”
          And that’s pretty much how it works.

          It isn’t actual money that it created bu banks, etc., but endogenous (debt-based) money — although we can say that the workers produce wealth, and money/cedit of some sort can be based on that. Marxist and socialists don’t determine the reality through theory, of course but just work with models, and many of those are obsolete, mistaken, or flawed.

          My point is that capitalism depends on making money by just by owning it, not producing real wealth, which is either found in nature or produced by work, and capital tends to accumulate in the hands of a few, or of one, like big fish eating littler fish in a pond until only one huge fish remains — which then starves. But while the big ‘fish’ gets bigger, he takes control of people, media, government, and resources, in a positive feedback loop, and can get richer even while destroying wealth overall. It’s not a sustainable system, and attempts to regulate or control it will always break down over time because the capitalist can game the system while the workers are preoccupied with production. In that sense, capitalism IS a bubble.

  4. J, Steven Livacich

    In regards to the comment by Mr. J. Davis about MMT in regards to fiscal policy, as seemingly viewed by the guest Mr. L. Randall Wray, it would seem that the counter cyclical policy as an anti deflationary tool would provide sufficient growth to pay a guaranteed annual wage or income, and provide impetus in the wage sectors that need the most stimulus. Thus by relieving the entire lower working class of insecure finances may be the sounder of economic policy and fiscally the most economically responsible rather than risky. Steve

  5. Howard Switzer

    “The idea behind capitalism is sound.” What would you say the idea behind capitalism is? What would a genuine capitalist say to that question? I would say it is to control the issuance of money to control governments, business and as much of the economy as possible for personal gain. I would say that is not sound economics at all, that is usury, the abuse of monetary authority for personal gain. The conventional definition of capitalism serves the interests of the oligarchy because it posits that anyone who owns a business is a capitalist thus diffusing the idea that there are Capitalists who control the issuance of money…right, now everyone is a capitalist so you cannot criticize it. The purpose of government is stated in the first sentence of the Constitution and Art.1 Sect.8 [5] gives government the power to create the money in order to do that. You want to money to come into the economy at the bottom where it is guaranteed to be spent into the economy not issued to the top where it goes to speculation.

  6. Howard Switzer

    I agree with Randall that we need a government that is dedicated to the public interest. I believe the Greens are the only ones actually dedicated to the public interest and their platform includes the Chicago Plan/Need Act reforms that would put money on a sound track and would create the economics of care replacing the economics of greed that we have. Marxism too, works 1.) to keep people ignorant about money and 2.) to steer them off into activities that don’t really challenge the issue. The idea that we can ever expect capitalism to be moral is a fantasy brought on by one’s need to protect their position in academia so we get a lot of talk carefully obfuscating the issue. Actually exposing monetary policy is the third rail for an economist precisely becasue that is where the power is! Were James Madison, Thomas Jefferson and John Adams all conspiracy theorists? I don’t think so. Those who wonder what Capitalism should be replaced with need to learn what Democracy really is. Those who imagine it has nothing to do with economics, again, don’t know anything about Democracy or its origins.

  7. madcapMongoose

    I appreciate that Randall Wray acknowledges here that Job Guarantee and Basic Income policies are not mutually exclusive. However, the amount that he suggests as a Basic Income ($25-40k/yr) is far greater than most Basic Income advocates are proposing (closer to $12k/yr). I have heard Pavlina Tcherneva cite a similar excessive figure for Basic Income (around $30k/yr). It would be good to hear Wray and Tcherneva clarify where they stand on the amount most Basic Income proposals are currently offering up.

    Questions for Wray, Tcherneva and other MMT economists:

    i.) Do you support $12k/yr or do you think even that will be unacceptably inflationary? Do you support $12k/yr if we fund it entirely by fiat money or does the way it is funded matter to the level you support?

    ii.) What level of Basic Income do you support independent of the Job Guarantee?

  8. BIG proponents advocate sufficient basic income that one can “choose” to not work–to pursue creative, artistic, innovative, public-spirited or whatever pursuits. $12k per year does not come close. That is a “choice” of life at a barely subsistence level (well below subsistence if one lives in a major city). That is “bait and switch”. Why $12k? Why not $1k? Why not $500? If you want it low enough to ensure no inflation, and you do not care about offering enough to live, then probably the upper single digits is the best. Many proponents do a bait and switch–pointing to Alaska’s permanent fund as a shining example of a BIG. Last I looked, it paid $800 a year–barely an Xmas gift in Alaska. (How’s that working out now, with oil prices down? I suppose it is even less.) I took them at their word. If you were to have a real choice of never working for pay, you would need closer to $40k a year–since by choosing that path, it would be very difficult to reverse course later (lack of job history, etc). On the other hand, if BIG proponents were to embrace revolution, overthrow the capitalist system, eliminate wage labor altogether, and then create the “new man” and “new woman” motivated by higher ideals to selflessly pursue the greater good, then they’d at least have a coherent story line.

    • madcapMongoose

      Thanks for your reply, LRWray.

      UBI/BIG supporters are a diverse group with some on the Progressive end of the political spectrum and others tending more Libertarian or Conservative. Thus their reasons for supporting UBI/BIG are not all the same but overall my sense is that few primarily support it as a way to allow people to forgo any need for waged work during their adult life.

      The $12k/year is chosen by many UBI/BIG supporters because that is the Federal Poverty Line for a single person (https://aspe.hhs.gov/poverty-guidelines). Again, few UBI supporters would argue that $12k/year is enough to live on by itself but many would argue that it can allow for greater bargaining power of labor and greater choice about the kind of work one would like to pursue. UBI is also promoted as a policy that can potentially help support much of the vital unwaged work that currently goes uncompensated (e.g. at home carework, volunteer work, open-source programming, involvement in local government, unpaid/low-paid internships) and allow for more people of modest means to have a go at entrepreneurship.

      The Alaska Permanent Fund is used as an example of people receiving an unconditional dividend from the State. Being tied to oil prices and fossil fuels it is hardly the ideal implementation of a UBI but it is an example of a generally popular program of cash payments that has been politically sustainable and not perceived as Socialism by the mostly Conservative citizens of Alaska.

      A priori, I see no conflict between the modest UBI proposals (~$12k/year) and a Job Guarantee/Public Works programs set at a higher level (~$25k/year with benefits). They are not mutually exclusive. Of course, political will to do either of these things at this point is lacking but I don’t see any reason for people to have to choose between these policies and in many ways I think they could complement each other.

  9. I think there should be a UBI to provide a modest living. It would do several good things.

    It severs the artificial link between needing money to live and needing to work as fulfillment. It gives the ability to move into an area one wants to pursue: going to school, learning a business and developing developing know-how, gaining skills and tools in some art or craft, working as a beginner or apprentice while being able to survive. It also makes it more possible for people to organize their own worker owned and run businesses.

    An important thing would be to give workers leverage to negotiate with prospective employers so they don’t have to take a job with rotten and tyrannical working conditions and low pay as often happens now, where people are wage slaves, with no way out, sometimes working two or three jobs like that.

    There is no reason for other benefits, such as medical or child care to be eliminated except under pressure from the right wing, greedy wealthy, and others of the ruling class (or those under their sway). We can have minimum income, guaranteed work and apprenticeship programs, free education of different types, and various social support programs.

    It’s time to stop thinking about work, or learning, as terrible things people have to be forced into doing because they exist in original sin and laziness. Laziness is a word used to denigrate people who wants to do things other than what the people in power want them to do, and a form of resistance which develops in reaction to tyranny and coercion to conform and do things which are meaningless, unproductive, unethical, unsuitable, or dehumanizing. Laziness is a reaction against slavery and abuse.