Monthly Archives: December 2012

Full Employment as the New Progressive Paradigm

By Dan Kervick

Part One of a four-part essay

Progressives might have been permitted a short respite from anxiety after the election of November 7th, 2012.  They could find a measure of solace from the result: at least the country hadn’t fallen into the hands of an expert practitioner of one of the more barbarous styles of American capitalism, a man who had expressed open contempt for the 47% of Americans who receive assistance from the government he was seeking to head.   Of course, Mitt Romney’s disdain for government assistance extends only so far, since he has no objection to the sturdy fortress of legislative, judicial and police protections erected to both institute and protect private property.   He knows as well as anybody that without these government-funded protections many members of the propertied classes would not remain propertied.  But let us not dwell on the past.   We can move on knowing that at least there will be no Mitt Romney era.   Romney can now go back to his former occupation of buying, selling, dismantling, dismembering, repackaging and reselling the enterprises built by other people, throwing many of the people who work in those enterprises out on the street, and stashing the proceeds in island banks, far away from the greedy hands of the democratic rabble whose votes he recently begged.

Alas, the desired respite has been all but non-existent, because Washington has moved on immediately to renew the flagellation of the American people.   Continue reading

Obama and Boehner’s Grand Bargain: Gullible Democrats are Falling for the Ol’ “Good Cop, Bad Cop” Routine

By Michael Hoexter

Generally political analyses of the last four years suffer from two main faults:  they either describe an almost undifferentiated environment of complete political corruption or they pinpoint a single main source of our political downfall and attribute most “evil” to that source.  Both of these approaches can at times illuminate but ultimately they leave activists and citizens with prescriptions for a campaign of either unimaginative partisanship or ultimately exhausting efforts to joust at every powerful actor and institution on the political scene.  In other words, we are often left with either on the one hand “they’re all evil” and on the other “evil emanates mostly from this person/institution/party”. Continue reading

An Alternative Meme for Money, Part 5: A Spending Meme

By L. Randall Wray

We take care of our own
We take care of our own
Wherever this flag’s flown
We take care of our own

Let me repeat and clarify my purpose in this series. I am attempting to initiate a discussion among progressives on how to frame discussions about money and related issues. My perspective is MMT. To be sure, on one level MMT is a description. It provides a correct description of the operation of a sovereign currency system. Some commentators have objected to my progressive framing; they assert that one can accept MMT without the progressive bias. Sure they can. One can understand how money “works” but prefer NOT to use money in the public interest. Continue reading

Why is the failed Monti a “technocrat” and the successful Correa a “left-leaning economist”?

By William K. Black
(Cross posted at Benzinga.com)

The New York Times produces profiles of national leaders like Italy’s Mario Monti and Ecuador’s Rafael Correa.  I invite readers to contrast the worshipful treatment accorded Monti with the Correa profile.  The next time someone tells you the NYT is a “leftist” paper you can show them how far right it is on financial issues.

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The Trillion Dollar Coin Is A Conservative Meme

By Joe Firestone

The Trillion Dollar Coin (TDC) is, first, an oversimplified meme, because there’s not one TDC solution, but lots of Platinum Coin Seigniorage (PCS) variations on that idea with differing implications for politics. Some just kick the can down the road, until the next debt ceiling crisis, or set up another trade between the Administration of something relatively valuable for something less valuable. Others would really change the political game. Continue reading

What Does The Trillion Dollar Coin Do?

By Joe Firestone

The Trillion Dollar Coin proposal for solving the debt ceiling problem is again experiencing a blogosphere explosion this past week. The precipitating factor may be that people are starting to believe that the Republicans will come to a “fiscal cliff” settlement with the Democrats including very little in entitlement spending; but will then come back, in 2013 with a very tough position on the price they want to agree to raise the debt ceiling to give the Executive operating room for any length of time. Bruce Bartlett had this to say on the issue: Continue reading

Origin and Early History of Platinum Coin Seigniorage In the Blogosphere

By Joe Firestone

[Revised 1/6/2013]

This post records the history of platinum coin seigniorage in the blogosphere through the debt ceiling agreement on August 2, 2011. Its purpose is to correct errors in the record about the history of this idea appearing on mainstream blog posts by Joe Wiesenthal, John Carney, and Brad Plumer, during the past week. The idea of using coin seigniorage, the profits made from minting proof platinum coins,  depositing them at the Fed, and receiving electronic credits in return, to remove the need for issuing debt, and so to always stay under the debt ceiling is due to a  commenter (and occasional blogger) on economics and politics blogs whose screen name is beowulf (Carlos Mucha). Beowulf’s first comment on Platinum Coin Seigniorage (PCS) was on Brad Delong’s site on July 6, 2010 (h/t Cullen Roche, 01/05/13). But, the first comment of his I noticed on PCS was at New Deal 2.0. Unfortunately, when The Roosevelt Institute redid its New Deal 2.0 site, it wiped out the record of beo’s comment. However, I quoted his ND 2.0 proposal in a post on November 12, 2010 discussing a possible Government shutdown due to the debt ceiling. I cross-posted this at Correntewire too where beowulf commented further on the platinum coin option.

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Virtually Speaking and Bill Black

NEP’s William Black appears on Virtually Speaking with host Jay Ackroyd (12/6). (Bill’s interview begins around the 12 minute mark)

Paying for Lunch – MMT Style

By Dan Kervick

A common criticism of Modern Monetary Theory is that it is a naïve doctrine of free lunches.  The critics grant that a country like the United States, which issues its own freely floating fiat currency, can always make the policy choice to issue whatever quantity of that currency it deems appropriate.  The US government can spend as many dollars into the private sector economy as it chooses, without obtaining those dollars from some other source first, and it can always pay any debts that have been incurred by borrowing dollars.  But the critics will go on to charge that MMT mistakenly concludes from these few institutional and operational facts that there are no economic limits to the wealth-generating capacities of the government.  They caricature MMT as a doctrine of manna from heaven, in which the power of issuing a generally accepted medium of exchange confers the power of conjuring real wealth into existence by prestidigitation.   In short, they see MMT as a disordered syndrome characterizing people who are experiencing massive money illusion.

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NEP Stands with Correntewire

By Stephanie Kelton

Our friend Lambert Strether is having a fundraiser and we at NEP want to support him the way he supported us more than three years ago.  We hadn’t met before, but Lambert wrote to ask if we would come to Washington, DC as an antidote to the “fiscal sustainability teach-in” that Peter G. Peterson was hosting. We agreed, and Lambert set about raising money and interest in the event.  Warren Mosler, Bill Mitchell, Randy Wray, Pavlina Tcherneva and I all participated.

Correntwire was also one of the very few places where the Proof Platinum Coin concept took root and sprouted.  He’s a tireless advocate who deserves our thanks.

If you support MMT, then please consider helping out someone who has done so much to help us over the years.  Click here to help.