Category Archives: J. D. Alt

Solving the Political Problem

By J.D. ALT

There was recently a breakthrough of sorts in media coverage for MMT. The Huffington Post published a piece covering the “People’s Convergence Conference” in Washington, D.C. on September 8-9. The conference brought together leaders and activists from all corners of the progressive political spectrum—including the “Draft Bernie for a People’s Party” movement. The conference apparently succeeded in creating the roots of a coordinated alliance between the leading progressive parties—including the Green Party, the Progressive Independent Party, and the Justice Party—which agreed, among other things, to the possibility of holding progressive primaries that would then field a single progressive candidate in the general elections. Most notable, however, the Huffington piece concluded with the header:  Progressive Economics: “How do we pay for it?”

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The Great Italian Experiment (part 2)

By J.D. ALT

As I said, Italy, is now experimenting with paying for public services with tax credits. Presumably, this is happening because Italy doesn’t possess enough Euros to pay its citizens to provide all the goods and services needed to maintain and run the public sector of its social economy. And Italy can’t “create” the additional Euros it needs because that prerogative is the exclusive right of the EU Central Bank which Italy, even as a sovereign member of the EU, has no control over. But, as the news article explains, Italy still needs to have the grass mowed and the weeds pulled in its public gardens. So it has decided (out of desperation, the article implies) to pay the gardeners with tax-credits. The gardeners are willing to do the work in exchange for the government’s tax-credits, because it means the Euros they earn (in other ways) can then be used to purchase goods and services rather than for paying their taxes. So, in practical terms, it is “just like” getting paid in Euros.

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Italy’s Great Experiment

By J.D. ALT

Italy is experimenting with giving tax-cuts to its citizens in exchange for public services―such as pulling weeds and cutting grass. Wow. What an amazing idea! The government issues a tax credit, and uses it to pay a citizen in exchange for the citizen’s services to the government. The government could even make this arrangement more formal by printing the tax credits on pieces of paper called “LIRIES” (or something like that) and paying for the weed-whacking services with this “cash.” That way the citizen who’s earned the “LIRIES” has the option of using them as payment to another citizen (who’d also like a tax-cut) for, say, a bag of potatoes. So, the first citizen pulls some weeds, gets paid in “cash” and then uses the “cash” to buy her dinner. If you thought about it, you could possibly run an entire economy in this fashion. The only thing you’d have to worry about, of course, is that the government might run out of the tax-credits it needs to pay the citizens to do the work! If that happened, where could the government possibly get more tax-credits? Could it collect tax-credits as “taxes”? Could it borrow them from all the street-sweepers and weed-whackers who’ve earned them? (In which case it would have to pay “tax-credit interest”―which just seems to exacerbate the problem!)  Hmmm. I’m going to have to think about that one. But in the meantime, doesn’t this mean that any Eurozone country has the option to stay IN the Eurozone while at the same time operating its own local economy using its own local “sovereign” currency?

 

LOW EARTH ORBIT—A Preview

By J.D. ALT

I have not written any essays for NEP these last several months because I’ve been working on a longer piece. It’s now finished and available as an ebook on Amazon and ibooks. The title is “LOW EARTH ORBIT—A Novella about the Near Future.” The story imagines the circumstances under which MMT breaks through into political awareness and acceptance. The heroine is an economics professor named Stephanie Eccles. There are, of course, a few comments about what modern fiat money makes possible in terms of architecture. I hope everyone will read it.

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Who will play the Harlequin?

By J.D. ALT

In a recent essay (“A Strategic Thought”) I suggested that right now is an opportune moment for some brave progressive leader to step out and explain what modern fiat money is, why we’ve been using, in fact, it for the past half century, and how it changes the way we imagine our federal government pays for public goods. Whoever takes on this challenge, I suggested, would be treated as a harlequin by mainstream media and economic pundits—and would be marginalized and shunned by other political leaders on both sides of the aisle. No main-stream politician is ready to hear—let alone agree—that the federal government can issue and spend as many dollars as needed to accomplish whatever the nation has the real resources to undertake. No main-stream economic pundit is ready to hear that our federal “deficit” is a necessary aspect of a healthy fiat monetary system. No main-stream Republican or Democrat is ready to acquiesce to the reality that our national “debt” is not something we have to “repay” to anyone but is, in fact, the savings account of our private sector economy. No main-stream anybody who, by definition, depends on their position in the main-stream idea-flow for their livelihood and personal status, is ready or willing to hear, or even seriously listen to, any of those realities. Yet at some point all of it has to be formally presented and argued on the national stage—otherwise, modern fiat money, and the enormous possibilities it creates for human society, will continue to languish forever as a suppressed and poorly understood reality.

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VOTE AMERICA CARD

By J.D. ALT

Happy New Year. Now let’s get to work. There is much to be accomplished. The first order of business, from my perspective, is the issue of reinvigorating our democracy—specifically:

What are zealously proactive progressives thinking about? Instead of hauling the Republicans into court over their voter I.D. statutes, we should be exuberantly embracing the very idea of a voter I.D. Yes! Let’s take conservatives at their word: The purpose is not to make it more difficult to vote, or to discourage certain classes of citizens from actually casting ballots—the goal is to make certain that only qualified, living and breathing voters vote, and that they only vote once. We agree wholeheartedly! And to ensure this is what happens, we propose that every qualified U.S. citizen be issued a VOTE AMERICA I.D. card—and that a concerted, organized, federally funded, national effort should immediately be commenced to implement this goal.

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A Strategic Thought

By J.D. ALT

I’d like to propose that it is important, right now, for existing progressive political leaders to stake out positions in support of direct sovereign spending for the creation of collective goods. If they must, they can call it “deficit spending.” What is important is that they very aggressively get on the record as proposing and supporting federal spending programs to to address specific issues that Americans are struggling with.

If this does not happen, there is a real risk that the newly empowered right-wing government of the Trump administration will propose to increase “deficit spending” first. If that were to happen, the progressive cause will have a serious dilemma: Do they push back against Trump―decrying the dangers of increasing the national debt!―or do they get aboard his spending train as more-or-less unnecessary baggage, and watch as it puffs and whistles its way into the hearts of the American heartland?

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A Walk in the Forest after the Election

By J.D. ALT

On November 8, I happened to be complacently immersed in one of the important books now available to the human species—The Hidden Life of Trees, by Peter Wohlleben.  On the morning of November 9, I realized that what I was reading not only offered a perfectly analogous explanation of what “happened” in the U.S. Presidential election, but also laid out instructive insights about what’s to come next.

To provide a highly simplified overview (please bear with me for a moment), forests of trees are highly integrated communities composed basically of three parts: the canopy, the ground, and the root-and-fungi structures below ground. The community grows and evolves very slowly, and once it is established certain inherent dynamics provide a long-term stability that is measured in centuries. One of the most crucial dynamics is the fact that the mature canopy, during the growing season, absorbs something like 97% of the sunlight falling on it. This means at the ground level, new trees—growing from the seeds dropped from above—receive essentially no sunlight for photosynthesis (which they need in order to produce sugars for growth). These baby trees are, in fact, “nursed” by the root systems of the parent trees around them. The nursing trees grow very slowly, biding their time until one of the parent trees dies and collapses. This leaves a gap in the canopy where sunlight suddenly streams through, and those baby trees fortuitously located below the gap begin to produce their own sugar like mad—and grow very rapidly upward toward adolescence. At the same time, in a healthy forest, the mature trees adjacent to the gap extend their own branches and leaves to fill the open space. Before this process is complete, the adolescent trees have several years of rapid growth, but when the canopy is re-closed, they have to stop and bide their time again. Once more, they are fed by the root systems of the parental forest. It isn’t until another parent collapses to the forest floor, that the late adolescent tree finally has the opportunity to rapidly grow into the gap of the canopy and become a mature member of the community.

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JD Alt Interviewed on “The Millennials’ Money”

Monday, 17 October, on the weekly progressive radio program Hopping Mad with Will McLeod and Arliss Bunny, JD Alt was interviewed about his book The Millennials’ Money. The broadcast version of the interview, which aired on Netroots Radio at 8AM Eastern on Monday, 17 October, was twenty-two minutes long. The podcast version of the interview is about twice that. The podcast is available on iTunes, Stitcher, Google Play and on the Hopping Mad website.

JD’s book was previewed here, on NEP, in sections as he was going through the writing process and many NEP contributors participated in comment threads which influenced aspects of the book. If you have not read it in its entirety, The Millennials’ Money is quite worthwhile in that it not only brings JD’s excellent diagrams, from his best-selling ebook Diagrams & Dollars, to a hardcopy format covering the basics of MMT but then goes beyond that with some genuinely interesting thinking on how the millennial (fourth turning) generation can best use MMT to solve some of the immense challenges they face.

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Two Loaves

By J.D. ALT

Recently, I’ve been trying to zero in on a peculiar set of ingredients that seem to be baked into our economic pie―and which are depriving that pie of a sustenance we, as a collective society, need it to provide. The peculiar ingredients have to do with our monetary system. Specifically, the fact that we―whether intentionally or by happenstance―have put in place and operate a money system that seamlessly creates dollars, as necessary, for profit-making enterprise, but specifically does NOT create dollars for not-for-profit ventures.

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