Daily Archives: January 25, 2013

Downsides to the Platinum Coin; or Just Defense of the Status Quo?

Posted on January 25, 2013 by Devin Smith | 34 comments

As part of a wonderful discussion thread on the legal basis for using Platinum Coin Seigniorage (PCS), following a post by beowulf (Carlos Mucha), the first to propose the Trillion Dollar Coin (TDC). Michael Sankowski, one of the founders of the Monetary Realism approach to economics offered a very long reply directed at High Value Platinum Coin Seignorage (HVPCS), and the TDC itself. Mike’s reply is a good example of the many misgivings people have about using PCS with face values in the trillions. Since Mike is a supporter, rather than opponent of PCS and believes that PCS is legal, I thought it would be worthwhile to deconstruct his long comment and show that his downsides are pretty speculative and don’t provide good grounds for supporting incrementalism is using PCS.

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34 Comments

Posted in Joe Firestone

Tagged $60 T coin, austerity, Fiscal Policy, HVPCS, incrementalism, Mike Sankowski, MMT, Modern Monetary Theory, Monetary Realism, platinum coin seigniorage, Trillion Dollar Coin

Beowulf and Diehl Embrace Trillion Dollar Coin Incrementalism!

Posted on January 25, 2013 by Devin Smith | 30 comments

By Joe Firestone

A wonderful discussion thread has been going on at Monetary Realism (MR) after a very good new post by beowulf (Carlos Mucha), who first brought forward the proposal for the Executive Branch to use the authority provided in the 1996 Platinum Coin Seigniorage (PCS) legislation to fill the public purse, on whether the Fed had a legal basis for turning down PCS in the form of the Trillion Dollar Coin (TDC). I’ll leave the legal discussion for another blog post, since I agree with beo on these, and also need to review some legal arguments against the TDC by some George Washington University Professors. Here I want to write about some of the MR discussion relating to PCS options.

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30 Comments

Posted in Joe Firestone

Tagged $60 T coin, austerity, beowulf, Carlos Mucha, Fiscal Policy, HVCS, HVPCS, incrementalism, MMT, Modern Monetary Theory, Philip Diehl, platinum coin seigniorage, Trillion Dollar Coin

From Central Bank Independence to Democratic Public Finance

Posted on January 25, 2013 by Dan Kervick | 121 comments

By Dan Kervick

Effective governance in any country requires a well-designed system of public finance through which that government can achieve its various purposes and pursue the public interest. If the system of public finance is poorly structured, the public interest will be poorly served. So, badly designed systems of public finance must be altered or abolished. [1]

We have reached that point in the United States. The present system of public finance in the US is inefficient and antiquated: its fusty architecture hampers the capacity of the national government to respond to economic fluctuations and crises in a timely and effective manner; its byzantine operational complexity thwarts democratic governance and generates pervasive public confusion about the full range of public policy options; and its over-reliance on government bonds means that wasteful and unearned profits flow to some of the most affluent members of US society, as they are paid service fees for intermediating what ought to be routine operations of the government.

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